SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
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 240.14a-11(c) or 240.14a-12
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PAGES, INC.
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14-a(6(i)(2) or
Item 22(a)(2) of Schedule 14A.
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:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price of 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):
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4) proposed maximum aggregate value of transaction.
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5) Total fee paid:
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[ ] 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
June 7, 1996
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Pages, Inc. on Tuesday, July 23, 1996. The meeting will begin at 2:00 P.M. at
801 94th Avenue North, St. Petersburg, Florida.
Information regarding the matters to be voted upon at the Annual Meeting
is contained in the attached Proxy Statement. We urge you to read the Proxy
Statement carefully.
Because it is important that your shares be voted at the Annual Meeting,
whether or not you plan to attend in person, we urge you to complete, date and
sign the enclosed proxy card and return it as promptly as possible in the
accompanying envelope. If you do attend the meeting and wish to vote your
shares in person, even after returning your proxy, you still may do so.
We look forward to seeing you in St. Petersburg, Florida on July 23,
1996.
Very truly yours,
/s/ S. Robert Davis
-------------------------
S. Robert Davis, Chairman
<PAGE>
PAGES, INC.
801 94th Avenue North
St. Petersburg, Florida 33702
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
to be Held on July 23, 1996
To the Stockholders of PAGES, INC.:
Notice is hereby given that the Annual Meeting of Stockholders of
Pages, Inc. (the "Company") will be held at 801 94th Avenue North, St.
Petersburg, Florida on July 23, 1996 at 2:00 P.M., Eastern Standard Time, to
consider and take action on the following matters:
1. To elect four Directors to serve on the Board of Directors of the
Company for one year and until their successors are duly elected and
shall qualify.
2. To consider and act upon a proposal to increase the aggregate
number of shares for which options may be granted under the
Company's 1993 Incentive Stock Option Plan from 187,500 to
537,500 shares.
3. To transact such other business as may properly come before the
meeting or any adjournment or adjournments thereof.
Stockholders of record at the close of business on June 6, 1996 are
entitled to notice of and to vote at the meeting or any adjournment
thereof. A list of stockholders entitled to notice of and to vote at the
meeting may be examined at the executive offices of Pages, Inc. at 801 94th
Avenue North, St. Petersburg, Florida 33702.
So that we may be sure your vote will be included, please date, sign and
return the enclosed proxy promptly. For your convenience, a postage
paid return envelope is enclosed for your use in returning your proxy. If you
attend the meeting, you may revoke your proxy and vote in person.
By Order of the Board of Directors
/s/Charles R. Davis
---------------------------
Charles R. Davis, Secretary
June 7, 1996
<PAGE>
PAGES, INC.
PROXY STATEMENT
For Annual Meeting of Stockholders
To be Held on July 23, 1996
SUMMARY
This Proxy Statement is furnished to Stockholders in connection with the
solicitation of proxies by the Board of Directors of Pages, Inc. (the
"Company") for use at its Annual Meeting of Stockholders to be held on July 23,
1996 at 2:00 P.M. at the Company's principal executive offices at 801 94th
Avenue North, St. Petersburg, Florida 33702, as set forth in the
accompanying Notice of Annual Meeting of Stockholders and at any
adjournments thereof. This Proxy Statement and the accompanying form of
proxy are first being mailed to Stockholders on or about June 7, 1996.
The Annual Meeting has been called to consider and take action on the
election of four Directors to serve on the Board of Directors of the
Company for one year and until their successors have been duly elected and
shall qualify and to consider and act upon a proposal to increase from
187,500 to 537,500 the aggregate number of shares for which options may be
granted under the Company's 1993 Incentive Stock Option Plan.
The close of business on June 6, 1996, has been fixed as the record
date for the determination of Stockholders entitled to notice of, and to
vote at, the Annual Meeting and any adjournments thereof (the "Record
Date"). The stock transfer books will not be closed.
SOLICITATION AND REVOCATION OF PROXIES
This Proxy Statement is being furnished to Stockholders in connection
with the solicitation of proxies by the Board of Directors of the Company for
use at the Annual Meeting of Stockholders to be held at the time, place,
and for the purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders and at any adjournments thereof.
As of the Record Date, there were 5,462,153 shares of the Company's
Common Stock, $.01 par value ("Common Stock") issued and outstanding,
(exclusive of 298,713 shares held in treasury). As of the Record Date, all of
the present directors and executive officers of the Company, a group of
seven persons, owned beneficially 1,380,094 shares of Common Stock. The
Company believes that such officers and directors intend to vote their
shares of Common Stock for each of the nominees to be elected as Directors
named in this Proxy Statement.
To be elected, the nominees to be selected as Directors named in this
Proxy Statement must receive a plurality of the votes cast by the Common
Stock entitled to vote. The proposal to increase the aggregate number of
shares for which options may be granted under the 1993 Incentive Stock
Option Plan is approved if the holders of a majority of the shares of
Common Stock present at the meeting in person or by proxy vote in favor of the
proposal. With respect to voting on the election of directors and to the
proposal to increase the aggregate number of shares for which options may be
granted under the 1993 Incentive Stock Option Plan, the presence in person or
by proxy, of a majority of the issued and outstanding shares of Common Stock
constitutes a quorum at the meeting.
Proxies given by Stockholders for use at the meeting may be revoked at any
time prior to the exercise of the powers conferred by giving notice of
revocation to the Company in writing or at the meeting or by delivering to
the Company a later appointment which supersedes the earlier one.
Abstentions and broker non-votes will be counted only for the purpose of
determining the existence of a quorum.
ALL PROXIES RECEIVED WILL BE VOTED IN ACCORDANCE WITH THE CHOICES
SPECIFIED IN SUCH PROXIES. ALL VALID PROXIES OBTAINED WILL BE VOTED AT THE
DISCRETION OF THE BOARD OF DIRECTORS WITH RESPECT TO ANY OTHER BUSINESS
THAT MAY COME BEFORE THE MEETING.
The cost of soliciting proxies in the accompanying form will be borne by
the Company. The Company may reimburse brokerage firms and others for their
expenses in forwarding proxy materials to the beneficial owners and soliciting
them to execute proxies.
VOTING RIGHTS
Stockholders of record at the close of business on the Record Date are
entitled to notice of and to vote at the Annual Meeting of Stockholders or any
adjournments thereof. On the Record Date, the Company had 5,462,153 shares
of Common Stock outstanding and entitled to vote on all matters properly
brought before the meeting. Each Common Share of record as of the Record Date
is entitled to one vote in all matters properly brought before the meeting.
STOCK OWNERSHIP
The shares of Common Stock constitute the only voting securities of the
Company. The table below sets forth information, to the best of the
Company's knowledge, with respect to the total number of shares of the
Company's Common Stock beneficially owned by each named Executive Officer,
Director, nominee for Director, beneficial owner of more than five percent of
the Common Stock, and all Directors, and executive officers as a group, as
reported by such person, as of the Record Date. The table below also sets
forth as to each holder the percent of the class represented by such Common
Stock. The Company believes that each individual or entity named has sole
investment and voting power with respect to the Common Stock indicated as
beneficially owned by them, except as otherwise noted.
Amount and
Nature
of Percent
Name and Address Beneficial of
Ownership Total1
S. Robert Davis 1,336,259 2 23.1%
801 94th Avenue North
St. Petersburg, Florida 33702
Charles R. Davis 687,003 3 11.7%
801 94th Avenue North
St. Petersburg, Florida 33702
Juan F. Sotos, MD 57,812 4 1.1%
4400 Squirrel Bend
Columbus, Ohio 43220
Robert J. Tierney 2,760 *
1905 Olentangy Blvd.
Columbus, Ohio 43214
Randall J. Asmo 35,625 5 *
5720 Avery Road
Dublin, Ohio 43016
All executive officers and 2,119,895 33.6%
directors a group (7 persons)6
*Less than 1%
____________________
1 Based upon 5,462,153 shares of Common Stock outstanding as of the
Record Date (exclusive of 298,713 shares held in treasury), plus, as to
each person listed, that portion of the 1,831,709 unissued shares of
Common Stock subject to outstanding options which may be exercised by such
person within the next 60 days and, as to all executive officers and
directors as a group, unissued shares of Common Stock as to which the
members of the group have the right to acquire beneficial ownership upon the
exercise of stock options within the next 60 days.
2 Includes 16,000 shares owned by Mr. Davis' wife as to which Mr. Davis
disclaims beneficial ownership and includes 317,187 unissued shares of
Common Stock as to which Mr. Davis has the right to acquire beneficial
ownership upon the exercise of stock options within the next 60 days.
3 Includes 781 shares owned by Mr. Davis' wife and 4,474 shares owned by
Mr. Davis' children as to which Mr. Davis disclaims beneficial
ownership and includes 394,490 unissued shares of Common Stock as to which Mr.
Davis has the right to acquire beneficial ownership upon the exercise of stock
options within the next 60 days.
4 Consists of shares of Common Stock held jointly by Dr. Sotos and his
wife, as to which Dr. Sotos exercises shared voting and investment power.
5 Includes 28,125 unissued shares of Common Stock as to which Mr. Asmo has
the right to acquire beneficial ownership upon the exercise of stock options
within the next 60 days.
6 The number of shares of Common Stock beneficially owned by all
executive officers and directors as a group includes all shares of Common
Stock listed in the foregoing table, plus 436 shares of Common Stock owned by
Tamara L. Zeph, an officer of the Company. William L. Clarke, an officer
of the Company does not own stock of the Company.
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning the
directors and executive officers of the Company.
Name Age Position 1
S. Robert Davis 2,3 57 Chairman of the Board, President,
Assistant Secretary, and Director
Charles R. Davis 2 34 Executive Vice President,
Secretary, and Director;
President of Clyde A. Short
Company, Inc.
Randall J. Asmo 31 Vice President
William L. Clarke 59 Senior Vice President; President
and Chief Executive Officer,
School Book Fairs, Inc.
Tamara L. Zeph 32 Chief Financial Officer and Treasurer
Juan F. Sotos, M.D. 3,4 68 Director
Robert J. Tierney 3,4 48 Director
___________________
1 All positions are those held with Pages, except as otherwise indicated.
2 S. Robert Davis and Charles R. Davis are father and son.
3 Member of the Audit Committee.
4 Member of the Executive Compensation Committee.
Executive officers serve at the pleasure of the Board of Directors.
Directors are elected at the Annual Meeting of Stockholders to serve for one
year and until their respective successors are duly elected and
qualified.
Business Experience Of Directors And Executive Officers
S. Robert Davis was elected a director and Chairman of the Board in
March, 1990, and Assistant Secretary in May, 1992. Prior to his election to
the Board of Directors, he served as Assistant to the President from
January, 1988, to March, 1990, on a part-time basis. Additionally, during the
past five years, Mr. Davis has operated several personal business
enterprises.
Charles R. Davis became a director of the Company in December, 1983. He
was elected as Vice President of the Company in April, 1986 and served as
Secretary and Assistant Treasurer of the Company from January, 1984
until April, 1986. In September, 1989, Mr. Davis was again elected
Secretary of the Company and, in July, 1991, he was elected Executive Vice
President of the Company. In September, 1992, Mr. Davis was elected
President of Clyde A. Short Company, Inc., a subsidiary of the Company.
Additionally, during the past five years, Mr. Davis has operated several
personal business enterprises.
William L. Clarke was elected Senior Vice President in May, 1996.
Shortly before this election, he joined School Book Fairs, Inc. as
President and Chief Executive Officer. Prior to that time, he was
president of Clarke & Associates, a management consulting firm. Mr.
Clarke's background also includes twelve years as partner of Deloitte &
Touche LLP and Ernst & Young LLP in the national retail practice.
Tamara L. Zeph was elected Treasurer and Chief Financial Officer of the
Company in May, 1996. Prior to that time, she served as Vice President of
Finance of School Book Fairs, Inc., a wholly owned subsidiary of the
Company. She has held financial positions with increased responsibility at
School Book Fairs, Inc. since January, 1993. Except for an eleven month
leave of absence, Ms. Zeph was an auditor with Arthur Andersen & Co. from
June, 1986 until December, 1992.
Randall J. Asmo was elected Vice President in September, 1992. Prior to
that time, he served as Assistant to the President from February, 1990 to
September, 1992. Additionally, since October, 1987, Mr. Asmo has served as
Vice President of Mid-States Development Corp., a privately-held real estate
development and leasing company, as Vice President of American Home Building
Corp., a privately-held real estate development company, and an officer of
several other small business enterprises.
Juan F. Sotos, M.D. was elected as a director on December 22, 1992.
Dr. Sotos has been a Professor of Pediatrics at the Ohio State University
College of Medicine since 1962 and also serves as Chief of Endocrinology and
Metabolism at Children's Hospital in Columbus, Ohio.
Robert J. Tierney was elected as a director on October 21, 1992. Dr.
Tierney currently serves as the Chairperson of the Ohio State University
Department of Education Theory and Practice. Dr. Tierney is also active in
education research and has served as a Professor at Ohio State University
since 1984.
THE BOARD OF DIRECTORS
The Company's Bylaws provide that the number of Directors which shall
constitute the whole Board of Directors shall be as from time to time
determined by resolution of the Board of Directors, but the number shall not
be less than three. The Board of Directors currently consists of five members,
but a vacancy was created in April, 1996 upon the resignation of Richard A.
Stimmel. The Board of Directors has not had adequate time to consider a
replacement for Mr. Stimmel and has not nominated a person to fill that
vacancy. Proxies cannot be voted for a greater number of persons than the
nominees named. The Board of Directors held five meetings during the fiscal
year ended December 31, 1995.
There are no material proceedings to which any Director, officer or
affiliate of the Company, any owner of record or beneficially of more than
five percent of any class of voting securities of the Company, or any
associate of any such Director, officer, affiliate of the Company, or
security holder is a party adverse to the Company or any of its
subsidiaries or has a material interest adverse to the Company or any of its
subsidiaries.
Committees of the Board of Directors
Audit Committee. The Audit Committee is responsible for making
recommendations to the Board of Directors concerning the selection and
engagement of the Company's independent certified public accountants and
reviews the scope of the annual audit, audit fees, and results of the
audit. The Audit Committee also reviews and discusses with management and the
Board of Directors such matters as accounting policies and internal
accounting controls, and procedures for preparation of financial
statements. Dr. Sotos, and Messrs. Tierney and S. Robert Davis are members of
such Committee. The Committee met three times during the fiscal year ended
December 31, 1995.
Executive Compensation Committee. The Executive Compensation
Committee approves the compensation for executive employees of the Company.
Dr. Sotos, and Mr. Tierney are members of such Committee. The Committee met
two times during the fiscal year ended December 31, 1995.
The Company has no nominating committee or any committee performing a
similar function.
SECTION 16(a) REPORTING DELINQUENCIES
Based solely upon a review of Forms 3 and 4 and amendments thereto
furnished to the Company during the fiscal year ended December 31, 1995,
Form 5 and amendments thereto furnished to the Company with respect to the
fiscal year ended December 31, 1995 and written representations received by the
Company, no person who, at any time during the fiscal year ended December
31, 1995 was a director, officer or beneficial owner of more than ten percent
of the common stock failed to file on a timely basis reports required by
section 16(a) of the Exchange Act during the most recent fiscal year or prior
fiscal years except to the extent reported in Proxy Statements for prior
fiscal years.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
Director Compensation
Each director who is not an officer of the Company receives a fee of
$1,100 for attendance at each Board meeting, a fee of $550 for attendance at
each telephonic Board meeting, and a fee of $500 for attendance at each meeting
of a Board committee of which he is a member. Directors who are also
officers of the Company receive no additional compensation for their services
as directors. Mr. Davis' compensation as Chairman of the Board is set forth
under "Executive Compensation" below.
Executive Compensation
The following table shows, for the fiscal years ended December 31,
1995 and 1994 and 1993, the cash compensation paid by the Company and its
subsidiaries, as well as certain other compensation paid or accrued for
those years, to the Company's Chairman and each of its executive officers
other than the Chairman (the Company had a total of only four executive
officers during fiscal year ended December 31, 1995, including the
Chairman) who served as such at the end of the last fiscal year (the "Named
Executive Officers") in the principal capacity in which they served.
<TABLE>
Summary Compensation Table
<CAPTION>
Long-term
Annual Compensation Compensation
----------------------------------------- ----------------
Number of Shares
Name and Other Annual Underlying All Other
Principal Position Year Salary Bonus Compensation Options Awarded Compensation
- ------------------------- -------- -------- ----- ------------ ----------------- ------------
<S> <C> <C> <C> <C> <C> <C>
S. Robert Davis, 12/31/95 $183,500 $0 $209,368 0 $0
Chairman 12/31/94 185,000 0 0 0 0
12/31/93 185,000 0 0 0 0
Richard A. Stimmel, 12/31/95 158,180 0 349,719 0 0
President 2 12/31/94 160,000 0 0 0 0
12/31/93 160,000 0 0 0 0
Charles R. Davis, 12/31/95 147,896 0 103,389 0 0
Executive Vice President 12/31/94 153,024 0 0 0 0
12/31/93 140,000 0 0 0 0
Randall J. Asmo, 12/31/95 60,000 0 0 10,500 3 0
Vice President 12/31/94 27,185 0 0 0 0
12/31/93 12,346 0 0 10,000 0
</TABLE>
______________
1 Represents solely stock options. No stock appreciation rights (SARs)
have been granted. Stock options granted to the Named Executive Officers, by
their terms, automatically adjust to reflect certain changes in the
outstanding shares of Common Stock, including stock dividends. Stock
options previously granted to Named Executive Officers, by their terms,
automatically adjust to reflect changes in the outstanding shares of
Common Stock of the Company, including stock dividends.
2 Mr. Stimmel resigned as an officer and director in April, 1996.
3 3,000 options granted to Mr. Asmo were in conjunction with a repricing of
options granted under the 1993 Incentive Stock Option Plan. See "Stock
Options and Stock Option Plans," below.
Option Grants in Last Fiscal Year
The following table sets forth information with respect to grants of
stock options to the Named Executive Officers during the fiscal year ended
December 31, 1995. All such options were granted under the 1993 Incentive
Stock Option Plan:
<TABLE>
Individual Grants
-----------------
<CAPTION>
% of Total Potential Realizable Value
Number of Options at Assumed Annual Rates
Securities Granted to of Stock Price
Underlying Employees Appreciation for Option
Options in Fiscal Excersise Expiration Term
--------------------------
Name Granted Year Price Date 5% 10%
- ----------------- ---------- ---------- ------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Randall J. Asmo 1 3,000 2% $2.69 09/29/01 $2,745 $ 6,226
Randall J. Asmo 7,500 5% $2.57 11/13/01 6,555 14,862
</TABLE>
1 The options granted to Mr. Asmo were in conjunction with the repricing and
cancellation of options to purchase 10,000 shares at an exercise price of
$10.88 per share.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Value
The following table sets forth the aggregate option exercises during the
fiscal year ended December 31, 1995 and the value of unexercised options
held by the named Executive Officers as of the end of the year.
<TABLE>
<CAPTION>
Number of Number of Shares Underlying Value of Unexercised
Shares Unexcercised Options In-the Money Options
Acquired on at Fiscal Year End at Fiscal Year End 1
--------------------------- ---------------------------
Name Exercise 2 Exercisable Unexercisable Excercisable Unexercisable
- ------------------- ------------ ----------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
Richard A. Stimmel 153,685 579,622 -- $369,005 0
S. Robert Davis 114,185 462,872 -- $271,192 0
Charles R. Davis 46,053 535,115 -- $355,876 0
Randall J. Asmo 0 28,125 10,500 $ 9,844 0
</TABLE>
___________________
1 The value of unexercised in-the-money options at year end represents the
difference between the fair market value of the shares of Common Stock of the
Company underlying the options on December 31, 1995, and the exercise price of
the options.
2 Mr. Stimmel resigned as an officer and director in April, 1996.
Employment Agreements
None of the Named Executive Officers have employment agreements with the
Company.
Stock Option Plans
In November, 1993, the Company adopted the 1993 Incentive Stock Option
Plan, which provides for the issuance by the Company, at the discretion of a
committee of the Company's Board of Directors currently consisting of
Messrs. Sotos, and Tierney, of up to 187,500 Common Stock to key employees of
the Company. It is intended that options issued under the 1993 Stock Option
Plan qualify as incentive stock options under Section 422 of the Internal
Revenue Code of 1986, as amended. As of June 6, 1996, options to purchase a
total of 422,625 shares of Common Stock issued under the 1993 Stock Option
Plan were outstanding. See also, "Proposal to Increase the Aggregate Number
of Shares for Which Options may be Granted Under the Company's 1993
Incentive Stock Option Plan."
During 1995, pursuant to a repricing of options issued under the 1993
Incentive Stock Option Plan by employees, the Company canceled options held by
Randall J. Asmo to purchase 10,000 shares at an exercise price of $10.88 per
share and granted to Mr. Asmo options to purchase 3,000 shares at an exercise
price of $2.69 per share, the then current market price of the
shares. Such options were repriced to reflect the lower trading price of the
Company's Common Stock and in each case reflected a decrease in the number
of shares subject to the options.
The following table sets forth information with respect to the
repricings of options held by any executive officer during the last ten
completed fiscal years:
<TABLE>
<CAPTION>
Number of Market Length of
Securities Price of Exercise Original Option
Underlying Stock at Price at New Term Remaining
Options Time of Time of Exercise at Date of
Name Date Repriced Repricing Repricing Price Repricing
- --------------- ------- ---------- --------- --------- -------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Randall J. Asmo 9/29/95 10,000 1 $2.69 $10.88 $2.69 approx. 4 yrs
Tamara L. Zeph 9/29/95 1,000 2 $2.69 $10.88 $2.69 approx. 4 yrs
</TABLE>
___________________
1 As part of the repricing, the number of shares of Common Stock underlying
the option was reduced from 10,000 to 3,000.
2 As part of the repricing, the number of shares of Common Stock underlying
the option was reduced from 1,000 to 300.
The foregoing was approved by the members of the Executive Compensation
Committee (the "Committee") of the Board of Directors: Juan F. Sotos,
M.D., and Robert J. Tierney.
From time to time for more than 10 years, the Company has issued to
employees, including officers, options to purchase Common Stock under an
informal, non-qualified plan. In some cases, such options were issued in
lieu of cash compensation. As of June 6, 1996, options of this type held by
employees to purchase 1,159,084 shares of Common Stock are outstanding at
exercise prices ranging from $0.80 to $11.75 per share which were
(adjusted for previous stock dividends) equal to the mean between the bid and
ask price of the Common Stock on the date the options were granted.
Compensation Committee Interlocks and Insider Participation
Mr. Stimmel, Dr. Sotos and Mr. Tierney, directors of the Company,
served as the Executive Compensation Committee during the fiscal year ended
December 31, 1995. Mr. Stimmel was an officer and employee of the Company
during the fiscal year ended December 31, 1995. Neither Dr. Tierney nor Dr.
Sotos serve or have served as an employee of the Company or any of its
subsidiaries. None of such persons serve on the board of directors of any
other public company.
Executive Compensation Committee's Report on Executive Compensation
The Committee has designed its executive compensation policies to
provide incentives to its executives to focus on both current and long-term
Company goals, with an overriding emphasis on the ultimate objective of
enhancing Stockholder value. The Committee has followed an executive
compensation program, comprised of cash and equity-based incentives, which
recognizes individual achievement and encourages executive loyalty and
initiative. The Committee considers equity ownership to be an important
factor in providing executives with a closer orientation to the Company and its
stockholders. Accordingly, the Committee encourages equity ownership by its
executives through the grant of options to purchase Common Stock. Similarly,
the Committee believes the Company's 1993 Incentive Stock Purchase Plan
encourages employees to build a meaningful stake in the Company, further
aligning their interests with those of the stockholders.
The Committee believes that providing attractive compensation
opportunities is necessary to assist the Company in attracting and
retaining competent and experienced executives. Base salaries for the
Company's executives, and the executives employed by the Company's
subsidiaries, have historically been established on a case-by-case basis by the
Board of Directors, based upon current market practices and the
executive's level of responsibility, prior experience, breadth of
knowledge, and salary requirements. Since its appointment in March, 1993, the
Committee has carried forward those policies. The base salaries of
executive officers have historically been reviewed annually by the Board of
Directors and are now reviewed annually by the Committee. Adjustments to
such base salaries have been made considering: (a) historical compensation
levels; (b) the overall competitive environment for executives; and (c) the
level of compensation necessary to attract and retain executive talent.
Stock options have historically been awarded upon hiring, promotion, or
based upon merit considerations. As the value of a stock option is
directly related to the market price of the Company's Common Stock, the
Board of Directors believes the grant of stock options to executives
encourages executives to take a view toward the long-term performance of the
Company. Other benefits offered to executives are generally the same as those
offered to the Company's other employees.
The Committee utilized the same policies and considerations enumerated
above with respect to compensation decisions regarding the Company's
President (its chief executive officer), Richard A. Stimmel. Mr. Stimmel's
1995 base salary was determined primarily by reference to his historical
compensation, his level of responsibility, his historical performance, and
the Company's desire to retain his continued service. The Committee
believes its compensation policies with respect to its President promote
the interests of the Company and its Stockholders through current
motivation of the President coupled with an emphasis on the Company's long-term
success.
The foregoing was approved by the members of the Committee: Juan F.
Sotos, M.D., and Robert J. Tierney.
Performance Graph
The following line graph compares the yearly change in the Company's
total return to its Stockholders as compared to total return of the Center for
Research in Securities Prices Total Return Index for the NASDAQ Stock Market
(U.S.) and the Standard & Poors Publishing Group, assuming a common starting
point of 100 for the five-year period from December 31, 1990, to December 31,
1995. Total Stockholder return for the Company, as well as for the
Indexes, was determined by adding (a) the cumulative amount of dividends
for a given year (assuming dividend reinvestment), and (b) the difference
between the share price at the beginning and at the end of the year, the sum
of which is then divided by the share price at the beginning of such year.
<TABLE>
COMPARISON OF FIVE YEAR CUMULATIVE RETURN AMONG PAGES, INC, NASDAQ NMS COMP,
AND S&P PUBLISHING
<CAPTION>
Fiscal Year Covered Pages, Inc. NASDAQ Comp S&P Publishing
<S> <C> <C> <C>
Measurement Point 12/31/90 100.00 100.00 100.00
12/31/91 147.37 157.26 123.14
12/31/92 326.32 181.97 143.80
12/31/93 565.79 208.03 182.57
12/31/94 236.84 202.97 175.89
12/31/95 85.53 285.26 226.67
</TABLE>
Adjusted to give effect to five-for-four stock dividends in each of April, 1990
and October, 1993
<PAGE>
ELECTION OF FOUR DIRECTORS TO SERVE FOR ONE YEAR AND UNTIL
THEIR SUCCESSORS HAVE BEEN DULY ELECTED AND SHALL QUALIFY
The Board of Directors has concluded that the re-election of S. Robert
Davis, Charles R. Davis, Juan F. Sotos, M.D. and Robert J. Tierney as
Directors is in the best interests of the Company and recommends their
election. The Board of Directors has a conflict of interest with respect to
such nomination. The Board of Directors has not nominated a person to replace
the director seat vacated by Mr. Stimmel's resignation in April, 1996.
Biographical information concerning Messrs. S. Robert Davis, Charles R. Davis,
Tierney and Dr. Sotos can be found under "Directors and Executive Officers."
Unless otherwise instructed or unless authority to vote is withheld, the
enclosed proxy will be voted for the election of the nominees listed
herein. Although the Board of Directors of the Company does not
contemplate that any of such nominees will be unable to serve, if such a
situation exists prior to the Annual Meeting, the persons named in the
enclosed proxy will vote for the election of such other persons as may be
nominated by the Board of Directors.
The Board of Directors unanimously recommends a vote FOR the election of
the nominees listed above. Unless indicated to the contrary, the
enclosed Proxy will be noted "FOR" such nominees.
PROPOSAL TO INCREASE THE
AGGREGATE NUMBER OF SHARES FOR
WHICH OPTIONS MAY BE GRANTED UNDER THE
COMPANY'S 1993 INCENTIVE STOCK OPTION PLAN
The Board of Directors unanimously recommends that the Company's
Stockholders consider and approve a proposal to increase the aggregate
number of shares of Common Stock for which options may be granted under the
Company's 1993 Incentive Stock Option Plan (the "Plan") from 187,500 to
537,500.
The Plan initially provided for the issuance of options to purchase up to
an aggregate of 150,000 shares of Common Stock to employees of the
Company. Pursuant to a subsequent five for four stock dividend occurring in
October, 1993, the number of options to purchase shares under the Plan
increased from 150,000 to 187,500. As of June 6, 1996, there were
outstanding options under the Plan to purchase an aggregate of 422,625
shares of Common Stock with a market value of $1,003,734, options to
purchase 364,500 of which are subject to the approval of the Company's
stockholders of the proposal described herein. Of the number of options
granted under the Plan, Mrs. Zeph, Treasurer and Chief Financial Officer of the
Company holds options to purchase 31,300 shares, Mr. Clarke, President and
Chief Executive Officer of School Book Fairs, Inc., holds options to purchase
75,000 shares, Mr. Asmo, Vice President of the Company, holds options to
purchase 25,500 shares, all current executive officers as a group hold
options to purchase 131,800 shares and all employees who are not
executive officers hold options to purchaes 290,825 shares. The current
directors of the Company hold no options under the Plan.
The purpose of the Plan is to strengthen the ability of the Company and
its subsidiaries to attract and retain well-qualified employees, to furnish
additional incentive to those persons responsible for the success of the
Company, and thereby to enhance Stockholder value. As of June 6, 1996,
approximately 262 employees of the Company and its subsidiaries, including
all directors other than Dr. Sotos and Mr. Tierney, were eligible to
participate in the Plan.
The Board of Directors believes that the number of shares of Common
Stock for which options may be granted under the Plan is insufficient to
meet the Company's needs to attract and retain qualified personnel and to
continue to provide incentives to employees. In addition, the granting of
options fosters the interests of both the recipients and the Company's
stockholders, in that the recipients have an incentive to maximize the
value of the Company to its stockholders. Therefore, the stockholders of the
Company are being asked to consider and vote for a proposal to increase the
aggregate number of shares for which options may be granted under the Plan
from 187,500 to 537,500.
Shares issued under the Plan may be either authorized and unissued
shares or treasury shares. Shares covered by options which cease to be
exercisable in whole or in part will again be available for the granting of
options. The Plan provides that the number of shares subject to the Plan and
the number of shares covered by and the exercise price of outstanding option
agreements are subject to appropriate adjustment in the case of any stock
dividends, recapitalization, reorganization, split-up, combination, or
exchange of shares, or other forms of reorganization or transactions.
The Plan is to be administered under the general direction and control of
the Board of Directors of the Company. The Board of Directors is to appoint
a committee of at least two directors (a "Committee"), each of which must
be a "disinterested person" as that term is defined in Rule 16b-3 under the
Securities Exchange Act of 1934, or any successor rule or regulation, to
administer the Plan.
There is no limit on the number of options that can be granted to any one
employee under the Plan. However, to the extent the aggregate fair market
value (determined as of the time the option is granted) of the
Common Stock for which any employee is granted options which are
exercisable for the first time by such employee during any calendar year
under the Plan and any other "Incentive Stock Option Plan" (as such term is
defined in Section 422 of the Internal Revenue Code) of the Company exceeds
$100,000, the excess options shall be treated as options which are not
incentive stock options.
Under the terms of the Plan, options may be granted to employees,
including officers of the Company or any subsidiary of the Company.
Directors of the Company who are also employees of the Company or one of its
subsidiaries are eligible to receive options, and in that respect, have a
conflict of interest with this proposal.
Options may be granted for terms not to exceed 10 years from the date of
grant, except that options granted to an employee who, at the time of such
grant, owns stock possessing more than ten percent of the total combined
voting power of all classes of stock of the company or of any subsidiary
of the Company (a "ten percent Stockholder") may not be exercisable
after the expiration of five years after the date the option is granted. The
option price must be not less than one hundred percent of the fair market value
of the Company's common Stock at the time of the granting of the option,
except in the case of a ten percent Stockholder, in which case the option
price must be at least one hundred ten percent of the fair market value of the
stock at the time of grant. The fair market value of the Company's Common
Stock is to be determined by the Committee.
The Plan provides that the purchase price for shares acquired pursuant to
exercise of options under the Plan must be paid in full in cash at the time of
exercise, but the Board of Directors of the Company, at its option, may permit
payment with Common Stock of the Company held by the optionee for more than
six months and having a fair market value equal to the purchase price.
Optionees may not exercise any part of any option granted under the
Plan unless the optionee has been in the continuous employment of the
Company or of a subsidiary of the Company at all times from the date of the
grant of the option until the date three months prior to the date of
exercise, except as described below. Such employment must be at least one
year before an option can be exercised. The Committee may prescribe a
longer time period before an option may be exercised by an optionee and the
Option Agreement may provide for exercise in installments of the option.
If an optionee dies (i) while an employee of the Company or a
subsidiary of the Company, or (ii) within three months after termination of his
employment with the Company or a subsidiary of the Company because of his
disability, all options which are exercisable at the time of his death and
during the three month period after his death may be exercised by the person
or persons to whom the optionee's right under the option pass by will or
applicable law, or if no such person has such right, by his executors or
administrators, at any time, or from time to time, but not later than 10
years after the date of grant of the option (five years in the case of a ten
percent Stockholder) or three months after the optionee's death, whichever date
is earlier.
If an optionee's employment by the company or a subsidiary of the
Company terminates because of his disability and such optionee remains
living for at least three months following such termination, he may
exercise all options which are exercisable on the date of termination and
during the three month period after his termination at any time or from
time to time, but not later than 10 years after the date of the grant of the
option (five years in the case of a ten percent Stockholder) or three months
after termination of employment, whichever date is earlier.
If an optionee's employment terminates by reason of his retirement in
accordance with the terms of the Company's tax qualified retirement plans, if
any, or with the consent of the Committee or involuntarily other than "for
cause," he may exercise all options which are exercisable on the date of such
termination and during the three month period after his termination at any
time or from time to time, but not later than 10 years after the date of
grant of the option (five years in the case of a ten percent stockholder)
or three months after termination of employment, whichever
date is earlier. For this purpose, termination "for cause" means
termination of employment by reason of the optionee's commission of a
felony, fraud, or willful misconduct which had resulted, or likely to
result, in substantial and material damage to the Company or a subsidiary of
the Company, all as the Committee in its sole discretion may determine.
If an optionee's employment terminates voluntarily or involuntarily
"for cause," all right to exercise his options terminate at the date of
such termination of employment.
Under certain circumstances, optionees may exercise their options
prior to the stated exercise date. These circumstances include a period in
which a tender offer which would result in a change of control of the
Company is pending, a 30-day period following a change of control of the
Company, and a 30-day period following a vote by Stockholders of the
Company approving a dissolution or liquidation of the Company, a sale or
other disposition of substantially all of its assets, or a merger or
reorganization in which the Company would not survive as an independent
publicly-held company.
A change in control is defined in the Plan to mean the acquisition by any
person, entity, or group (as such term is defined in the Securities Exchange
Act of 1934, as amended, and the rules and regulations of the Securities
and Exchange Commission adopted thereunder) of Common Stock of the Company in
a transaction or series of transactions that results in such person, entity, or
group owning beneficially 50% or more of the outstanding Common Stock of the
Company. A merger or consolidation of the Company with another corporation
is not a "change of control,' however, if the Stockholders of the
Company receive in such merger or consolidation shares of voting common stock
in the resulting or surviving corporation that is registered under the
Securities Exchange Act of 1934, as amended, and that is either listed for
trading on a national securities exchange or is the subject of bid and asked
quotations in an automated quotation system (such as NASDAQ) operated by a
national securities association.
All options under the Plan must be granted within 10 years after the
date the Plan is adopted, or the date the Plan is approved by the Company's
Stockholders, whichever is earlier. Prior to that date, the Board of
Directors of the Company may suspend or discontinue the Plan and (except as
described in the next sentence) the Board of Directors may, without
obtaining Stockholder approval, amend the Plan including, without
limitation, amend the Plan in order for options granted under the Plan to
qualify as "incentive stock options" under Section 433 of the Internal
Revenue Code or to conform with changes in any applicable laws or
regulations. Stockholder approval is required for any proposed amendment
which would increase the number of shares reserved for options pursuant to the
Plan, permit the grant of any option at an option price less than the price
determined in accordance with the Plan, shorten the period provided for in
the Plan which must elapse between the date of the grant of an option and
the date on which any part of an option may be exercised by an optionee, or
permit the granting of options which expire beyond the period provided for in
the Plan. Without the written consent of an optionee, no amendment or
suspension of the Plan may alter or impair any option previously granted
to him under the Plan.
It is intended that options granted under the Plan qualify as
"incentive stock options" under the Internal Revenue Code. Section 422 of the
Internal Revenue Code provides that recipients of incentive stock options
do not realize any taxable income upon exercise of such options, provided no
disposition of the stock so acquired is made within two years from the date
of the granting of the option or within one year from the date of exercise
of the option. Assuming compliance with these and other applicable Internal
Revenue Code provisions, an optionee will realize a
capital gain or loss when he or she disposes of the shares. If the
optionee disposes of the shares before the expiration of the one-year and
two-year waiting periods, any amount realized from such a disqualifying
disposition will be taxable as ordinary income in the year of disposition to
the extent of the difference between the option price and either the fair
market value on the date the option is exercised or the disposition price,
whichever is less. At the time of a disqualifying disposition, the Company
would be entitled to an income tax deduction for the amount taxable to the
optionee as ordinary income, such deduction being the only income tax
deduction the Company will receive with respect to the operation of the Plan.
At the close of business on June 6, 1996, the last sale price of the
Company's Common Stock in the over-the-counter market, as quoted in the
NASDAQ, as reported in The Wall Street Journal, was $2.38.
The Board of Directors believes that the Plan will continue to be a
valuable means of recruiting and retaining highly qualified employees and
therefore unanimously recommends a vote FOR approval of the proposal to
increase the aggregate number of shares for which options may be granted
under the Plan. Unless indicated to the contrary, the enclosed proxy will be
voted "FOR" this proposal.
INDEPENDENT PUBLIC ACCOUNTANTS
The accounting firm of Deloitte & Touche LLP, Tampa, Florida is the
Company's current principal auditor and accountant and was the Company's
principal auditor and accountant for the year ended December 31, 1995. On
October 28, 1994, the Company dismissed both Hausser + Taylor as its
principal independent accountants and Arthur Andersen as its independent
auditor of School Book Fairs Limited, the Company's U.K. subsidiary. The
Registrant's Audit Committee participated in and approved the decision to
change independent accountants.
The reports dated March 29, 1995 and March 27, 1996 of Deloitte &
Touche LLP on the financial statements for the fiscal year ended December 31,
1994 and December 31, 1995, respectively, contained no adverse opinion or
disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope or accounting principles; yet, the report dated
March 25, 1995 included an explanatory paragraph referring to a potential
income tax assessment by the IRS.
In connection with its audit through October 28, 1994, there were no
disagreements with Hausser + Taylor on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements if not resolved to the satisfaction of
Hausser + Taylor would have caused them to make reference thereto in their
report on the financial statements for such year.
In connection with its audit through October 28, 1994, there were no
disagreements with Arthur Andersen on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements if not resolved to the satisfaction of
Arthur Andersen would have caused them to make reference thereto in their
report on the financial statements for such years.
Management expects that a representative of Deloitte & Touche LLP will be
present at the Annual Meeting of Stockholders. The Deloitte & Touche LLP
representative will be afforded an opportunity to make a statement at the
meeting if desired and is expected to be available to respond to
appropriate questions.
ANNUAL REPORT
The 1995 Annual Report, which includes financial statements was mailed to
each Stockholder receiving this Proxy Statement.
The Company will provide, without charge, to any person receiving a
copy of this Proxy Statement, upon written or oral request of such person, by
first class a copy of the Company's Annual Report on Form 10-K for the year
1995, including the financial statements and the financial statement schedules
thereto. Such requests should be addressed to S. Robert Davis, Chairman,
Pages, Inc., 801 94th Avenue North, St. Petersburg, Florida 33702.
OTHER PROPOSED ACTION
The Board of Directors does not intend to bring any other matters
before the meeting nor does the Board of Directors know of any matters
which other persons intend to bring before the meeting. If, however, other
matters not mentioned in this Proxy Statement properly come before the
meeting, the persons named in the accompanying form of proxy will vote
thereon in accordance with the recommendation of the Board of Directors.
STOCKHOLDER PROPOSALS AND SUBMISSION
If any Stockholder wishes to present a proposal for inclusion in the
proxy materials to be solicited by the Company's Board of Directors with
respect to the next Annual Meeting of Stockholders, such proposal shall be
presented to the Company's management prior to February 7, 1997.
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE FILL IN,
DATE, SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY IN THE ENCLOSED ENVELOPE
TO WHICH NO POSTAGE NEED BE AFFIXED IF MAILED IN THE UNITED STATES.
YOUR VOTE IS IMPORTANT. IF YOU ARE A STOCKHOLDER OF RECORD AND ATTEND THE
MEETING AND WISH TO VOTE IN PERSON, YOU MAY WITHDRAW YOUR PROXY AT ANY TIME
PRIOR TO THE VOTE.
By Order of the Board of Directors
/s/ Charles R. Davis, Secretary
-------------------------------
Charles R. Davis, Secretary
Dated: June 7, 1996
<PAGE>
PAGES, INC. * 801 94th Avenue North * St. Petersburg, Florida 33702
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 23, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints S. Robert Davis and Charles R. Davis, and
each of them, proxies, with full power of substitution in each of them, in the
name, place, and stead of the undersigned, to vote at the Annual Meeting of
Stockholders of PAGES, INC. on July 23, 1996, at 2:00 P.M., Eastern
Standard Time, or at any adjournment thereof, according to the number of
votes that the undersigned would be entitled to vote if personally
present, upon the following matters:
1. Election of Directors:
[ ] For all nominees listed below (except as marked to the contrary below)
[ ] Withhold Authority to vote for all nominees listed below
S. Robert Davis, Charles R. Davis,
Juan F. Sotos, M.D., and Robert J. Tierney
(Instruction: To withhold authority to vote for any nominee,
write that nominee's name in the space below.
Do not mark "Withhold Authority" above
unless you intend to withhold authority to vote for all nominees.)
2. Approval to increase the aggregate number of shares for which options may
be granted under the Company's 1993 Incentive Stock Option Plan from 187,500
to 537,500 shares.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting or any adjournment
thereof.
This proxy will be voted in accordance with the instructions given above. If
no instructions are given, this proxy will be voted FOR the election of
directors as set forth in the Proxy Statement and FOR Item 2 above.
[ ] Dated: __________________, 1996
_______________________________
Signature
[ ] _______________________________
Signature if held jointly
<PAGE>
FIRST AMENDMENT TO
PAGES, INC.
1993 INCENTIVE STOCK OPTION PLAN
Pursuant to the authority granted to the Board of Directors under
Section 7 of the Pages, Inc. 1993 Incentive Stock Option Plan (the "Plan")
the Plan is hereby amended by direction of the Board of Directors of the
Company as follows:
1. Paragraph 5(b)(ii)(A) is amended to read in its entirety as
follows:
"If an optionee shall die (i) while an employee of the
Corporation or a Subsidiary Corporation, or (ii) within three
months after termination of his employment with the
Corporation or a Subsidiary Corporation because of his
disability, all options which are exercisable at the time of
his death and during the three month period after his death,
may be exercised by the person or persons to whom the
optionee's right under the option pass by will or applicable
law, or if no such person has such right, by his executors or
administrators, at any time, or from time to time, but not
later than the expiration date specified in Section 5(a) or
three months after the optionee's death, whichever date is
earlier. All other options shall terminate."
2. Paragraph 5(b)(ii)(B) is amended to read in its entirety as
follows:
"If an optionee's employment by the Corporation or a
Subsidiary Corporation shall terminate because of his
disability and such optionee remains living for at least
three months following termination, he may exercise all
options which are exercisable on the date of termination and
during the three month period after his termination at any
time or from time to time, but not later than the expiration
date specified in Section 5(a) or three months after
termination of employment, whichever date is earlier. All
other options shall terminate."
3. Paragraph 5(b)(ii)(C) is amended to read in its entirety as
follows:
"If an optionee's employment shall terminate by reason of his
retirement in accordance with the terms of the Corporation's
tax-qualified retirement plans, if any, or with the consent
of the committee or involuntarily other than "for cause," he
may exercise all options which are exercisable on the date of
such termination and during the three month period after this
termination at any time or from time to time, but not later
than the expiration date specified in Section 5(a) or three
months after termination of employment, whichever date is
earlier. For this purpose, termination "for cause" shall
mean termination of employment by reason of the optionee's
commission of a felony, fraud, or willful misconduct which
had resulted, or is likely to result, in substantial and
material damage to the Corporation or a Subsidiary
Corporation, all as the Committee, in its sole discretion,
may determine."
<PAGE>
PAGES, INC.
1993 INCENTIVE STOCK OPTION PLAN
as amended May 6, 1996
1. Purpose. The purpose of the Pages, Inc. Incentive Stock Option
Plan (the "Plan") is to provide a means by which Pages, Inc. (the
"Corporation"), through the grant of stock options to eligible employees, may
attract and retain able employees and motivate such employees to exert their
best efforts on behalf of the Corporation and any subsidiary corporation of
the Corporation. For the purposes of the Plan, the term "Subsidiary
Corporation" means a subsidiary corporation as defined by Section 425(f) of the
Internal Revenue Code of 1986, as amended (the "Code"). It is intended that
the options issued under the Plan will qualify as incentive stock options under
Section 422 of the Code.
2. Shares Subject to the Plan. Subject to the provisions of Section
5(g) of the Plan, 150,000 shares of the common stock of the Corporation shall
be reserved and may be optioned under the Plan. The reserved shares may be
authorized and unissued shares or treasury shares of the Corporation or any
combination of both as determined by the Board of Directors of the Corporation.
If an option granted under the Plan ceases to be exercisable in whole or in
part, the shares representing such option shall be available under the Plan
for the grant of options in the future.
3. Administration of the Plan. The Plan shall be
administered by a Committee of the Board of Directors of the
Corporation (the "Committee"), which Committee shall consist of
not less than two directors of the Corporation. Members of the
Committee shall be appointed by and shall serve at the pleasure
of the Board of Directors of the Corporation. Any vacancies in the
membership of the Committee shall be filled by an appointment
by the Board of Directors of the Corporation. Each member of the
Committee shall be a disinterested person as that term is defined
in Rule 16b-3 under the Securities Exchange Act of 1934 or any
successor rule or regulation.
The Committee shall keep minutes of its meetings. All
actions of the Committee shall be taken by a majority of its
members. Any act approved in writing by a majority of the
Committee members shall be fully effective as if it had been
taken by a vote of a majority of the members at a meeting duly
called and held.
Subject to and not inconsistent with the provisions of the
Plan, the Committee shall have complete authority in its
discretion to interpret all provisions of the Plan consistently
with the law, to prescribe the form of the instrument evidencing
any option granted under the Plan, to adopt, amend, and rescind
general and special rules and regulations for the administration
of the Plan, and to make all other determinations necessary or
advisable for the administration of the Plan.
4. Eligibility and Grant of Options Under the Plan.
Options may be granted at such times, in such amounts, and, to
the extent not inconsistent with the Plan, on such terms as the
Committee shall determine subject to the following:
(a) Eligibility. Options may be granted to such
employees, including officers and directors who are also
employees, of the Corporation or of a Subsidiary Corporation that
the Committee deems to be key employees who, in the judgment of
the Committee, are considered important to the future of the
Corporation or a Subsidiary Corporation.
(b) Ten Percent Shareholders. No option may be
granted to any such eligible employee who at the time of such
grant owns stock possessing more than 10% of the total combined
voting power of aft classes of stock of the Corporation or of any
Subsidiary Corporation (a " 10 Percent Shareholder") unless at the
time such option is granted the option price is at least 110 % of
the fair market value of the stock and such option by its
terms is not exercisable after the expiation of five years after the
date such option is granted.
(c) Limitations. The aggregate fair market value of
the stock, determined at the time an option for the stock is
granted, for which options are exercisable for the first time by
an optionee during any calendar year, under all the incentive
stock option plans of the Corporation and of any Subsidiary
Corporation, may not exceed $100,000. All options under the Plan
shall be granted within 10 years after the date the Plan is
adopted, or the date the Plan is approved by the Corporation's
shareholders, whichever is earlier.
5. Terms and Conditions of Options Granted Under the Plan.
Each option granted under the Plan shall be evidenced by an
agreement, in a form determined by the Committee, which agreement
sham set forth, among other things, the number of shares of the
Corporation's common stock subject to the option and the price to
be paid upon exercise of the option. Such agreement shall be
subject to the following express terms and conditions, and such
other terms and conditions as the Committee may deem appropriate:
(a) Option Period. Each option agreement shall
specify the period for which the option thereunder is granted and
sham provide that the option shall expire at the end of such
period. The period during which an option may be exercised may not
exceed 10 years from the date of the grant of the option or five
years in the case of a 10 Percent Shareholder.
(b) Exercise of Option.
(i) By an Optionee During Continuous Employment. An
optionee may not exercise any part of an option granted under
the Plan unless the optionee has been in the continuous
employment of the Corporation or of a Subsidiary Corporation at all
times from the date of the grant of the option until the date
three months prior to the date of exercise, except as provided
below. Such employment must be at least one year before an
option can be exercised. The Committee may prescribe a longer
time period before an option may be exercised by an optionee.
The option agreement may provide for exercise in installments of the
option granted.
(ii) Exercise in the Event of Death or Termination of
Employment.
(A) If an optionee shall die (i) while an
employee of the Corporation or a Subsidiary Corporation, or (ii)
within three months after termination of his employment with the
Corporation or a Subsidiary Corporation because of his
disability, all options which are exercisable at the time of his
death and during the three month period after his death may be
exercised by the person or persons to whom the optionee's right
under the option pass by will or applicable law, or if no such
person has such right, by his executors or administrators, at any
time, or from time to time, but not later than the expiration
date specified in Section 5(a) or three months after the
optionee's death, whichever date is earlier. All other options
shall terminate.
(B) If an optionee's employment by the
Corporation or a Subsidiary Corporation shall terminate because
of his disability and such optionee remains living for at least
three months following such termination, he may exercise all
options which are exercisable on the date of termination and
during the three month period after his termination at any time
or from time to time, but not later than the expiration date
specified in Section 5(a) or three months after termination of
employment, whichever date is earlier. All other options shall
terminate.
(C) If an optionee's employment shall
terminate by reason of his retirement in accordance with the
terms of the Corporation's tax-qualified retirement plans, if
any, or with the consent of the committee or involuntarily other
than "for cause," he may exercise all options which are
exercisable on the date of such termination and during the three
month period after this termination at any time or from time to
time, but not later than the expiration date specified in Section
5(a) or three months after termination of employment, whichever
date is earlier. For this purpose, termination "for cause" shall
mean termination of employment by reason of the optionee's
commission of a felony, fraud, or willful misconduct which had
resulted, or is likely to result, in substantial and material
damage to the Corporation or a Subsidiary Corporation, all as the
Committee, in its sole discretion, may determine.
(D) If an optionee's employment shall
terminate voluntarily or involuntarily "for cause," all right to
exercise his options shall terminate at the date of such
termination of employment.
(iii) Exercise in the Event of a Change in
Control or Other Events. Optionees may exercise their options
prior to the stated exercise date (A) during a period in which a
tender offer is pending which would result in a Change of
Control, as defined below, of the Company, (B) during a 30-day
period following a Change of Control, and (C) during a 30-day
period following (i) a vote by shareholders of the Company
approving a dissolution or liquidation of the Company, (ii) a
sale or other disposition by the Company of all or substantially
all of its assets, or (iii) a merger or reorganization in which
the Company would not survive as an independent publicly-held
company.
For purposes of this Paragraph 5(b)(iii), the
term "Change of Control" shall mean the acquisition by any
person, entity, or group (a such term is defined in the
Securities Exchange Act of 1934, as amended, and the rules and
regulations of the securities and Exchange Commission adopted
thereunder) of common stock of the Corporation in a transaction
or series of transactions that result in such person, entity, or
group owning beneficially 50% or more of the outstanding common
stock of the Corporation. Provided, however, a merger or
consolidation of the Corporation with another corporation is not
a Change of Control if the shareholders of the Corporation
receive in such merger or consolidation shares of voting common
stock in the resulting or surviving corporation that is
registered under the Securities Exchange Act of 1934, as amended,
and that is either listed for trading on a national securities
exchange or is the subject of bid and asked quotations in an
automated quotation system (such as NASDAQ) operated by a
national securities association.
(c) Option Price. The option price per share
shall be determined by the Committee at the time an option is
granted and shall be not less than 100% of the fair market value
(110 % in the case of a 10 Percent Shareholder) of a share of the
common stock of the Corporation on the date of the grant as
determined in good faith by the Committee. Fair market value at
the time of payment shall be determined without regard to any
restriction other than a restriction that, by its terms, will
never lapse.
(d) Payment of Purchase Price upon Exercise.
Each option shall provide that the purchase price of the shares
for which an option may be exercised shall be paid to the
Corporation at the time of exercise either in cash or with stock of
the Corporation held by the optionee for more than six months and
having a fair market value equal to the purchase price.
(e) Nontransferability. No option granted under
the Plan shall be transferable other than by a will of an
optionee or by the laws of descent and distribution. During his
lifetime, an option shall be exercisable only by an optionee or
by the optionee's attorney-in-fact or conservator, unless such
exercise by the attorney-in-fact or conservator of the optionee
would disqualify the option as an incentive stock option under
Section 422 of the Code.
(f) Investment Representation. The shares of stock to be issued
upon the exercise of all or any portion of any option granted
under the Plan shall be issued on the condition that the optionee
represents that the purchase of stock upon such exercise shall be
for investment purposes and not with a view to resale,
distribution, offering, transferring, mortgaging, pledging,
hypothecating, or otherwise disposing of any such stock under the
circumstances which would constitute a public offering or
distribution under the Securities Act of 1933 or the securities
laws of any state. No shares of stock shall be issued upon the
exercise of any option unless the Corporation shall have received
from the optionee a written statement satisfactory to legal
counsel for the Corporation containing the above representations,
granting a right of first refusal of the Corporation to purchase
such shares in the event of a proposed transfer or disposition of
such shares, stating that certificates representing such shares
may bear a legend restricting their transfer, and stating that
the Corporation's transfer agent or agents may be given
instructions to stop transfer of any certificate bearing such
legend. Such representation and restrictions provided for herein
shall not be required if (1) an effective registration statement
for such shares under the Securities Act of 1933 and any
applicable state laws has been filed with the Securities and
Exchange Commission and with the appropriate agency or commission
of any state whose laws apply to the transaction, or (2) an
opinion of counsel satisfactory to the Corporation has been
delivered to the Corporation to the effect that registration is
not required under the Securities Act of 1933 or under the
applicable securities laws of any state. In the event the
Corporation proposes to register any of its securities under the
Securities Act of 1933 or any applicable state laws, it shall
notify each optionee who shall have purchased shares of stock
upon the exercise of all or of any portion of any option granted
under the Plan, and if such optionee desires of registering any
of such shares of stock held by him, he shall notify the
Corporation within 30 days after receiving such notice and shall
thereafter be entitled to have the Corporation include such
shares in such registration upon payment by him to the
Corporation of his pro rata share of the cost of such
registration.
(g) Adjustments in Event of Change in Common
Stock. Notwithstanding any other provision of the Plan, in the
event after the Effective Date of any change in the outstanding
common stock of the Corporation by reason of any stock dividend,
recapitalization, reorganization, merger, consolidation, split-
up, combination, or exchange of shares, rights offering to
purchase the common stock at a price substantially below fair
market value, or of any similar change affecting the common
stock, the number and kind of shares which thereafter may be
optioned and sold under the Plan and the number and kind of
shares which thereafter may be optioned and sold under the Plan
and the number and kind of shares subject to option in
outstanding option agreements and the purchase price per share
thereof shall be appropriately adjusted consistent with such
change in such manner as the Committee may deem equitable to
prevent substantial dilution or enlargement of the rights granted to,
or available for, an optionee under the Plan.
(h) No Rights as a Shareholder. No optionee
shall have any rights as a shareholder with respect to any shares
subject to his option prior to the date of issuance to him of a
certificate or certificates for such shares.
(i) No Rights to Continued Employment. The Plan
and any option granted under the Plan shall neither confer upon
any optionee any right with respect to continuance of employment
by the Corporation or by any subsidiary of the Corporation, nor
shall it interfere in any way with the right of his employer to
terminate his employment at any time.
6. Compliance with Other Laws and Regulations. The Plan,
the grant and exercise of options under the Plan, and the
obligation of the Corporation to sell and deliver shares under
such options shall be subject to all applicable federal and state
laws, rules, and regulations and to such approvals by any
government or regulatory agency as may be required. The
Corporation shall not be required to issue or deliver any
certificates for shares of common stock prior to the completion
of any registration or qualification of such shares under any
federal or state law, or any ruling or regulation of any
government body which the Corporation shall, in its sole
discretion, determine to be necessary or advisable.
7. Amendment and Discontinuance. The Board of Directors of the
Corporation may amend (including, without limitation, amend the
Plan in order for options granted under the Plan to qualify as
"Incentive Stock Options" under Section 422 of the Code or to
conform with changes in any applicable laws or regulations),
suspend, or discontinue the Plan; provided, however, that,
subject to the provisions of Section 5(g), no action of the Board
of Directors of the Corporation or of the Committee may without
shareholder approval (a) increase the number of shares reserved
for options pursuant to Section 2, (b) permit the grant. of any
option at an option price less than the price determined in
accordance with Section 5(c), (c) shorten the period provided for
in Section 5(b)(i) which must elapse between the date of the
grant of an option and the date on which any part of an option
may be exercised by an optionee, or (d) permit the granting of
options which expire beyond the period provided for in Section
5(a). Without the written consent of an optionee, no amendment
or suspension of the Plan shall alter or impair any option
previously granted to him under the Plan.
8. Effective Date. The effective date of the Plan shall be
June 28, 1993, subject to the approval by shareholders of the
Corporation holding not less than a majority of the shares
present, or represented, and entitled to vote at the 1993 Annual
Meeting of Shareholders. Notwithstanding the foregoing, if the
Plan is approved by the Board of Directors prior to such meeting,
options may be granted by the Committee as provided by the terns of
the Plan subject to such subsequent shareholder approval.
9. Name of the Plan. The Plan shall be known as the
Pages, Inc. 1993 Incentive Stock Option Plan.
10. Effect of the Plan on Other Stock Plans. The adoption
of the Plan shall have no effect on awards made or to be made
pursuant to other stock plans covering employees of the
Corporation, a Subsidiary Corporation, a Parent corporation, or any
predecessors or successors thereto.
<PAGE>
SUMMARY OF OPTION GRANT
Name of Optionee:
-----------------------------------------
Date of Grant:
-----------------------------------------
Date of Expiration:
-----------------------------------------
Number of Shares Subject to Stock Options:
----------------
Option Price Per Share: $
----------------------
Additional Comments:
----------------------
Date:
----------------
<PAGE>
EXHIBIT 3(c)
Secretary
Pages, Inc.
Re: Notice of Exercise of Incentive Stock Option
--------------------------------------------
Dear Sir:
The undersigned elects to exercise an incentive stock option
to purchase ______ shares of Common Stock of Pages, Inc. under
and pursuant to the Pages, Inc. 1993 Incentive Stock Option Plan
and the Stock Option Grant and Agreement dated the ____ day of
19__. I have read, understood, and agreed to the terms,
conditions, and provisions of both the above-named Plan and the
Stock Option Grant and Agreement.
Enclosed is my check in the amount of $_______________ in
payment of the purchase price.
The name or names to be on the stock certificate or certificates and the
address and social security number of such person or persons are as follows:
Name:
------------------------------------------
Address:
---------------------------------------
Social Security Number:
------------------------
Sincerely,
Special Instructions:
<PAGE>
