Notice of SunAmerica Inc.
1995 Special Meeting
of Shareholders
and Proxy Statement
[LOGO]
[Eli Broad Letterhead]
September 21, 1995
Dear Fellow Shareholders:
Your officers and directors join me in inviting you to attend a
Special Meeting of Shareholders of SunAmerica Inc. The formal notice of this
meeting and the Proxy Statement accompany this letter.
The Special Meeting is being held for the purpose of amending the
Company's Charter to increase the number of shares of authorized Common Stock
and Nontransferable Class B Stock. If the shareholders approve this Charter
amendment, the Company will effect a three-for-two stock split which was
approved by the Company's Board of Directors on September 11, 1995.
If it is not possible for you to attend, please return the enclosed
proxy immediately to insure that your shares will be voted. Since mail delays
occur frequently, it is important that the proxy be returned well in advance
of the meeting.
We look forward to seeing you at SunAmerica Inc., 38th Floor, 1
SunAmerica Center, Century City, Los Angeles, California at 1:30 p.m. on
Monday, October 30, 1995.
Sincerely,
Eli Broad
Chairman of the Board,
President and Chief Executive Officer
SUNAMERICA INC.
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To Be Held October 30, 1995
To the holders of the Common, Class B Common and Series C Preferred Stock of
SunAmerica Inc.:
A Special Meeting of Shareholders of SunAmerica Inc. will be held on
Monday, October 30, 1995, at 1:30 p.m. at SunAmerica Inc., 38th Floor, 1
SunAmerica Center, Los Angeles, Century City, California for the following
purposes:
(a) To consider and vote upon a proposal to amend the Charter to
increase the Company's authorized capital from (i) 50,000,000
to 175,000,000 shares of Common Stock (par value, $1.00 per
share) and (ii) 15,000,000 to 25,000,000 shares of
Nontransferable Class B Stock (par value, $1.00 per share); and
(b) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on September
21, 1995 as the record date for determination of shareholders entitled to
notice of and to vote at the special meeting or any adjournment thereof.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE,
DATE AND SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED STAMPED
ENVELOPE.
BY ORDER OF THE BOARD OF DIRECTORS
Susan L. Harris
Vice President and Secretary
Los Angeles, California
September 21, 1995
SUNAMERICA INC.
1 SunAmerica Center
Los Angeles, California 90067-6022
September 21, 1995
PROXY STATEMENT
for
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD
OCTOBER 30, 1995
To Our Shareholders:
Your Board of Directors is furnishing this Proxy Statement in
connection with its solicitation of your Proxy in the form enclosed to be used
at a Special Meeting of the Company's shareholders to be held on Monday,
October 30, 1995, at the time and place and for the purposes set forth in the
accompanying Notice of Special Meeting of Shareholders.
This Proxy Statement will be mailed to shareholders on or about
September 26, 1995.
We cordially invite you to attend the meeting. Whether or not you
plan to attend, we urge you to date, sign and return your Proxy promptly in
the envelope enclosed. You may revoke your Proxy at any time prior to its
exercise at the special meeting by notice to the Company's Secretary, and, if
you attend the meeting, you may vote your shares in person.
Only holders of record of the 29,449,510 shares of Common Stock, the
6,826,439 shares of Nontransferable Class B Stock (the "Class B Stock") and
the 486,800 shares of Adjustable Rate Cumulative Preferred Stock, Series C
(the "Series C Preferred Stock") outstanding at the close of business on
September 21, 1995, will be entitled to vote at the meeting.
The affirmative vote of two-thirds of all the votes entitled to be
cast by holders of the Common Stock, the Class B Stock and the Series C
Preferred Stock, voting together as a single class, is required to approve the
amendment. In addition, the affirmative vote of a majority of all votes
entitled to be cast by holders of the Common Stock, voting as a separate
class, and the affirmative vote of a majority of all votes entitled to be cast
by holders of the Class B Stock, voting as a separate class, are required to
approve the amendment. Each holder of Common Stock is entitled to one vote
for each share held. Each holder of Class B Stock is entitled to ten votes
for each share held. Each holder of Series C Preferred Stock is entitled to
1/10th of one vote for each share held. There is no right to cumulative
voting as to any matter.
If approved by the shareholders, the proposed amendment will become
effective upon the filing of Articles of Amendment with the State Department
of Assessments and Taxation of Maryland amending the Company's Restated
Articles of Incorporation. The filing will occur as soon as reasonably
practicable after the Special Meeting.
The election inspectors appointed for the meeting will tabulate all
votes cast by proxy or in person at the Special Meeting and will determine
whether or not a quorum is present. Abstentions will be counted for the
purpose of determining the existence of a quorum at the Special Meeting.
However, because the proposal to amend the Charter requires the affirmative
vote of the outstanding shares of the respective classes of capital stock of
the Company as set forth above, abstentions and broker non-votes will have the
same effect as a vote against the proposed Charter amendment.
Mr. Broad, Chairman of the Board, Chief Executive Officer and
President of the Company, holds or exercises voting power over shares which
represent approximately 61.7% of the votes entitled to be cast for the
amendment of the Company's Charter. He intends to cast an affirmative vote
for the amendment.
The persons named as proxies in the enclosed forms are Messrs. Eli
Broad, Chairman of the Board, President and Chief Executive Officer, Jay S.
Wintrob, Vice Chairman, and Joseph M. Tumbler, Vice Chairman.
BENEFICIAL OWNERSHIP OF SHARES
The following information is furnished as of August 31, 1995, to
indicate beneficial ownership by each director and certain executive officers,
individually, and all executive officers and directors of the Company, as a
group, of shares of the Company's Common Stock or its Class B Stock. None of
the Directors or Executive Officers owned any shares of the Series C Preferred
Stock. The Class B Stock is convertible at any time by the holder thereof
into Common Stock. Each share of Class B Stock has 10 times the voting rights
of each share of Common Stock and receives a dividend equal to 90% of any cash
dividend paid on the Common Stock.
<TABLE>
<CAPTION>
Amount Beneficially Percent of
Name of Beneficial Owner Owned(1) Vote
------------------------ ---------------------- ----------
<S> <C> <C>
Ronald J. Arnault 4,000 *
James R. Belardi 91,727(2) *
Eli Broad 7,076,253(3) 61.7%
Michael L. Fowler 15,027(4) *
Gary W. Krat 125,327(5) *
David O. Maxwell 10,371 *
Barry Munitz 5,000 --
Lester Pollack 2,250 *
Carl E. Reichardt -- --
Richard D. Rohr 14,108(6) *
Sanford C. Sigoloff 10,500 *
Harold M. Williams 500 *
Karen Hastie-Williams -- --
Jay S. Wintrob 317,427(7) *
All directors and officers as a group (23 persons) 8,056,030(8) 62.7%
========= =====
<FN>
_______________
* Less than 1%.
(1) Unless otherwise indicated, (i) beneficial ownership is direct, (ii) the
person indicated has sole voting and investment power and (iii) the shares
are Common Stock.
(2) Of these shares, 33,500 shares represent restricted shares granted
under the Company's employee stock plans as to which Mr. Belardi has
no investment power, 41,700 represent stock options held by Mr.
Belardi which are or will become exercisable on or before October 30,
1995 and as to which he has no voting or investment power.
(3) Of these holdings, 1,162,041 shares are Common Stock, and 5,914,212
shares are Class B Stock. Of the Common Stock, 93,084 shares represent
restricted shares granted under the Company's employee stock plans as
to which Mr. Broad has no investment power; 337,500 shares are held by
a trust formed by Mr. Broad of which he is a beneficiary; and 692,900
shares represent employee stock options held by Mr. Broad which are or
will become exercisable on or before October 30, 1995 and as to which
he has no voting or investment power. Of the Class B Stock, 562,500
shares are held by a trust formed by Mr. Broad of which he is a
beneficiary; 21,712 shares are held by a foundation of which Mr. Broad
is a director and as to which he has shared voting and investment
power; and 1,935,000 shares are registered in the name of a corporation
as to which Mr. Broad exercises voting and investment power. Mr.
Broad has beneficial ownership of approximately 3.9% of the Common
Stock outstanding and 86.7% of the Class B Stock outstanding.
(4) Of these holdings, 10,000 shares represent restricted shares granted
under the Company's employee stock plans as to which Mr. Fowler has no
investment power; and 5,000 shares represent employee stock options
held by Mr. Fowler which are or will become exerciseable on or before
October 30, 1995, and as to which he has no voting or investment power.
(5) Of these holdings, 71,500 shares represent restricted shares granted
under the Company's employee stock plans as to which Mr. Krat has no
investment power; and 47,300 shares represent employee stock options
held by Mr. Krat which are or will become exercisable on or before
October 30, 1995.
(6) Of these shares, 12,383 shares are held by Mr. Rohr and his wife as
co-owners, and Mr. Rohr has shared investment and voting power with
respect thereto.
(7) Of these holdings, 129,454 shares represent restricted shares granted
under the Company's employee stock plans as to which Mr. Wintrob has no
investment power; and 161,500 shares represent employee stock options
held by Mr. Wintrob which are or will become exercisable on or before
October 30, 1995, and as to which he has no voting or investment power.
(8) Of these aggregate holdings, 1,109,500 shares represent employee stock
options held by such persons which are or will become exercisable on or
before October 30, 1995, and as to which no voting or investment power
is held; and 778,038 shares represent restricted shares granted under
the Company's employee stock plans as to which no investment power is
held. All directors and officers as a group have beneficial ownership
of approximately 7.2% of the Common Stock outstanding, and 86.7% of the
Class B Stock outstanding.
</TABLE>
Based on certain public reports, the Company believes that as of
August 31, 1995, the only person known to be a beneficial owner of more than
5% of the Company's Common Stock was Fidelity Management & Research
Corporation, 82 Devonshire Street, Boston, Massachusetts 02109-3614, which
owned 2,271,500 shares, or approximately 8.6% of the Common Stock outstanding.
As of August 31, 1995 the only person known to be a beneficial owner of more
than 5% of the Company's Series C Preferred Stock was Midland National Life
Insurance Company, One Midland Plaza, Sioux Falls, South Dakota 57193, which
owned 126,625 shares, or approximately 26.0% of the Series C Preferred Stock
outstanding. Except for Mr. Broad, whose business address is 1 SunAmerica
Center, Los Angeles, California 90067-6022, and certain trusts for the benefit
of the family of Donald Kaufman, the co-founder of the Company, whose business
address is c/o Edward Landry of Musick, Peeler & Garrett, One Wilshire
Boulevard, Suite 2000, Los Angeles, California 90017, the Company knows of no
person who owned in excess of 5% of the outstanding Class B Stock. The trusts
referred to above for the benefit of the family of Donald Kaufman beneficially
own in the aggregate 907,327 shares of Class B Stock, or approximately 13.3%
of the Class B Stock outstanding.
PROPOSED AMENDMENT TO THE COMPANY'S Charter
TO INCREASE THE NUMBER OF AUTHORIZED SHARES
OF COMMON STOCK AND CLASS B STOCK
The Board of Directors has declared advisable and recommended an
amendment to the Company's Charter to increase the number of authorized shares
of Common Stock in order to, among other things, permit a three-for-two stock
split, to be effected in the form of a stock dividend, as described below. In
addition, the proposed amendment would increase the number of authorized
shares of Class B Stock. The Board of Directors believes that the
availability of additional Common Stock will provide flexibility and allow the
Company to issue Common Stock if, as and when the need arises. It is
therefore proposed to amend the Company's Charter to increase (i) the number
of authorized shares of Common Stock from 50,000,000 to 175,000,000 shares and
(ii) the number of authorized shares of Class B Stock from 15,000,000 to
25,000,000 shares. The proposed amendment does not affect any terms or rights
of the outstanding shares of either Common Stock or Class B Stock. Neither the
holders of Common Stock nor the holders of Class B Stock have preemptive
rights.
The text of the proposed amendment is set forth in Annex A attached
to this Proxy Statement.
As of August 31, 1995, of the 50,000,000 authorized shares of Common
Stock and the 15,000,000 authorized shares of Class B Stock, 29,443,710 shares
and 6,826,439 shares, respectively, were outstanding. There were also
15,786,632 shares of Common Stock (the "Reserved Shares") reserved for
issuance under employee benefit plans, upon exercise of employee stock options
existing or to be granted, upon conversion of the Class B Stock and upon
conversion of the Company's Series D Mandatory Conversion Premium Dividend
Preferred Stock (the "Series D Preferred Stock"). Taking into account the
Reserved Shares and the 29,443,710 shares of outstanding Common Stock, as of
August 31, 1995, the total number of issued and reserved shares of Common
Stock was 45,230,342. As of August 31, 1995, the Company also had outstanding
3,514,765 shares of 9-1/4% Preferred Stock, Series B, 486,800 shares of Series
C Preferred Stock and 100,050 shares of Series D Preferred Stock.
The Board of Directors believes it is in the Company's best interest
to increase the number of authorized but unissued shares of Common Stock in
order to have additional authorized but unissued shares available for issuance
to meet business needs as they arise. In addition to allowing the Company to
effectuate the three-for-two stock split described below, the Board of
Directors believes that the availability of additional shares of Common Stock
will provide the Company with the flexibility to issue Common Stock for other
proper corporate purposes which may be identified by the Board of Directors in
the future, such as the declaration of additional stock dividends or
distributions, the sale of stock to obtain additional capital funds and the
issuance of such stock in connection with acquisitions of or mergers with
other companies. The Company recently filed with the Securities and Exchange
Commission a shelf registration statement (the "Registration Statement")
providing for the issuance, from time to time, of various securities which may
include Common Stock or securities convertible into Common Stock.
The authorized shares of Common Stock and Class B Stock in excess of
those issued will be available for issuance at such time and for such
corporate purposes as the Board of Directors may deem advisable without
further action by the Company's shareholders, except as may be required by
applicable laws or the rules of the New York Stock Exchange. Upon issuance
such shares will have the same rights as the outstanding shares of Common
Stock and Class B Stock, respectively.
The increase in the authorized shares of Class B Stock is being made
solely to facilitate any future stock splits and dividends that are deemed
advisable by the Board of Directors. Pursuant to Article Fifth, Section 7(d)
of the Company's Charter, the Company may not issue additional shares of Class
B Stock except in connection with stock splits and stock dividends unless such
issuance is approved by the affirmative vote of a majority of all votes
entitled to be cast by the holders of Common Stock, voting as a separate
class, and the affirmative vote of a majority of all votes entitled to be cast
by the holders of Class B Stock, voting as a separate class.
The Board of Directors does not intend to issue any Common Stock or
securities convertible into Common Stock except on terms that the Board deems
to be in the best interests of the Company and its shareholders. Any future
issuance of Common Stock or securities convertible into Common Stock will be
subject to the rights of holders of outstanding shares of any Preferred Stock
which the Company may issue in the future. Other than the three-for-two stock
split described below and the possible issuance of Common Stock as
contemplated by the Registration Statement, the Company's management has no
arrangements, agreements, understandings or plans at the present time for the
issuance or use of the additional shares of Common Stock to be authorized by
the proposed Charter amendment.
Although an increase in the authorized shares of Common Stock and
Class B Stock could, under certain circumstances, have an anti-takeover effect
(for example, by diluting the stock of a person seeking to effect a change in
the composition of the Board of Directors or contemplating a tender offer or
other transaction for a combination of the Company with another company), this
proposal to amend the Charter is not in response to any effort of which the
Company is aware to accumulate the Company's stock or obtain control of the
Company, nor is it part of a plan by management to recommend a series of
similar amendments to the Board of Directors and shareholders.
STOCK SPLIT
Subject to shareholder approval of the Charter amendment, the Board
of Directors of the Company has declared a three-for-two stock split to be
effected in the form of a stock dividend (the "Stock Split"). The Stock Split
is expected to be paid on November 10, 1995 to shareholders of record on
November 1, 1995. If the proposed amendment is approved, each holder of
record of Common Stock or Class B Stock on the record date will receive one
additional share of Common Stock or Class B Stock, as the case may be, for
every two shares of Common Stock or Class B Stock owned on that date. The
Stock Split can be completed only if the authorized shares of Common Stock are
increased.
Following shareholder approval of the amendment and the effectuation
of the Stock Split, there will be 250,000,000 authorized shares of Common
Stock and 25,000,000 authorized shares of Class B Stock, of which (based upon
shares outstanding or reserved as of August 31, 1995 adjusted for the Stock
Split) approximately 44,165,565 shares of Common Stock and 10,239,658 shares
of Class B Stock will be outstanding and approximately 23,679,948 shares of
Common Stock will be reserved for issuance under employee benefit plans, upon
exercise of employee stock options existing or to be granted, upon conversion
of the Class B Stock and upon conversion of the Series D Preferred Stock. In
accordance with the terms of the Company's employee benefit plans, appropriate
adjustments will be made upon effectiveness of the Stock Split to the number
of shares of Common Stock reserved for issuance under such plans and the
exercise price for the number of shares covered by outstanding options. In
accordance with the terms of the Series D Preferred Stock, appropriate
adjustments will be made upon effectiveness of the Stock Split to the number
of shares of Common Stock reserved for issuance upon conversion of such
Preferred Stock.
Based upon current tax law, the Stock Split will not be taxable for
Federal income tax purposes. The tax basis of every share held before the
Stock Split will be allocated among the three shares held as a result of the
distribution, and the holding period of new shares will include the holding
period of the shares with respect to which they were issued. The laws of
jurisdictions other than the United States may impose income taxes on the
issuance of the additional shares and shareholders subject to such laws are
urged to consult their tax advisors.
No change in total shareholders' equity will result from the Stock
Split. The aggregate amount of stated capital represented by outstanding
shares of Common Stock and Class B Stock will be increased by $1.00 for each
share issued to effect the Stock Split, and the Company's "capital surplus"
will be reduced by the same amount.
The Board of Directors believes that the Stock Split is in the best
interests of the shareholders. The Board of Directors believes that the
reduction in stock price in connection with the Stock Split will make the
Common Stock more attractive to certain investors which may result in an
increased number of shareholders and greater investment interest in the
Company.
After the Stock Split, purchases and sales of Common Stock by an
individual shareholder may be subject to somewhat higher brokerage charges and
applicable stock transfer taxes than on a pre-split transaction of equivalent
market value, due to the greater number of shares of Common Stock outstanding
after the Stock Split. In addition, the Company will incur certain expenses
in connection with the Stock Split, such as listing fees and the cost of
preparing and delivering to shareholders the new certificates representing the
additional shares.
OTHER MATTERS
The Board of Directors knows of no business other than that described
herein that will be presented for consideration at the Special Meeting. If,
however, other business shall properly come before the meeting, the persons
named in the enclosed form of Proxy intend to vote the shares represented by
said Proxies on such matters in accordance with their judgment in the best
interests of the Company.
SHAREHOLDERS' PROPOSALS FOR THE
1996 ANNUAL MEETING OF SHAREHOLDERS
Any proposal of a shareholder intended to be presented at the 1996
Annual Meeting of Shareholders must have been received by the Company for
inclusion in the proxy statement and form of proxy for that meeting by August
20, 1995.
METHOD OF PROXY SOLICITATION
The entire cost of preparing, assembling, printing and mailing the
Notice of Meeting, this Proxy Statement, the Proxy itself, and the cost of
soliciting Proxies relating to the meeting will be borne by the Company. In
addition to use of the mails, proxies may be solicited by officers, directors,
and other regular employees of the Company by telephone, telegraph or personal
solicitation, and no additional compensation will be paid to such individuals.
The Company will use the services of Morrow & Co., Inc., a professional
soliciting organization, to assist in obtaining in person or by proxy the
largest number of shareholders possible. The Company estimates its expenses
for such services will not exceed $25,000. The Company will, if requested,
reimburse banks, brokerage houses, and other custodians, nominees and certain
fiduciaries for their reasonable expenses incurred in mailing proxy material
to their principals.
ANNEX A
RESOLVED, that the first paragraph of Article Fifth of the Company's
Charter be amended to read in its entirety as follows:
ARTICLE FIFTH: The total number of shares of stock of all
classes which the Corporation has authority to issue is 235,000,000 shares,
which consists of 175,000,000 shares of Common Stock of the par value of
One Dollar ($1) each for an aggregate par value of One Hundred Seventy-Five
Million Dollars ($175,000,000), 25,000,000 shares of Nontransferable Class
B Stock of the par value of One Dollar ($1) each for an aggregate par value
of Twenty-Five Million Dollars ($25,000,000), 15,000,000 shares of
Transferable Class B Stock of the par value of One Dollar ($1) each for an
aggregate par value of Fifteen Million Dollars ($15,000,000), and
20,000,000 shares of Preferred Stock without par value.
SUNAMERICA INC.
[COMMON] [NONTRANSFERABLE CLASS B] [SERIES C PREFERRED] STOCK
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD OCTOBER 30, 1995
The undersigned hereby appoints Eli Broad, Chairman of the Board,
President and Chief Executive Officer, Jay S. Wintrob, Vice Chairman, and
Joseph M. Tumbler, Vice Chairman, and each of them, as proxies with full power
of substitution and revocation, to vote in the name, place and stead of the
undersigned, with all powers the undersigned would possess if personally
present, all of the shares of [Nontransferable Class B] [Common] [Series C
Preferred] Stock of SunAmerica Inc. the undersigned is entitled to vote at
said Company's special meeting of shareholders to be held on October 30, 1995
and at all adjournments thereof.
The undersigned hereby acknowledges receipt of the Notice of Special
Meeting of Shareholders and Proxy Statement for such meeting, dated September
21, 1995.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND MAY
BE REVOKED PRIOR TO ITS EXERCISE. This Proxy when properly executed will be
voted as directed herein by the undersigned shareholder. If no direction is
indicated, it will be voted for the Charter Amendment and on such other
matters as may properly come before the meeting.
The Board of Directors recommends a vote for the Proposal listed
below.
FOR AGAINST ABSTAIN
__ __ __
Charter amendment to increase the Company's authorized capital from (i)
50,000,000 to 175,000,000 shares of Common Stock (par value, $1.00 per
share) and (ii) 15,000,000 to 25,000,000 shares of Nontransferable Class B
Stock (par value, $1.00 per share).
Dated ________________, 1995
____________________________
____________________________
(Please sign EXACTLY as your name appears
hereon) When signing as attorney, executor,
administrator, trustee or guardian, please
give full title, if more than one trustee,
all should sign. All joint owners should
sign. If a corporation, sign in full
corporate name by President or other
authorized officer. If a partnership, sign
in partnership name by authorized person.
</TEXT/
