<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
Korn/Ferry International
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
<PAGE>
[LOGO OF KORN/FERRY INTERNATIONAL]
1800 Century Park East, Suite 900
Los Angeles, California 90067
August 21, 2000
Dear Stockholders:
We are pleased to invite you to attend the 2000 annual meeting of
stockholders of Korn/Ferry International to be held on Tuesday, September 26,
2000 at 10:00 a.m. at the Park Hyatt Los Angeles at Century City located at
2151 Avenue of the Stars, Los Angeles, California 90067.
The agenda for our 2000 annual meeting includes three proposals, each of
which is identified and described in the enclosed proxy statement.
We are delighted that you have chosen to invest in Korn/Ferry International
and hope that, whether or not you attend the meeting, you will vote as soon as
possible by completing, signing, dating and returning the enclosed proxy card
in the envelope provided. Your vote is important, and voting by written proxy
will ensure your representation at the 2000 annual meeting. You may revoke
your proxy in accordance with the procedures described in the proxy statement
at any time prior to the time it is voted. If you attend the meeting, you may
vote in person even if you previously mailed your proxy card.
Sincerely,
/s/ Richard M. Ferry /s/ Windle B. Priem
Richard M. Ferry Windle B. Priem
Chairman of the Board Chief Executive Officer
and President
<PAGE>
[LOGO OF KERN/FERRY INTERNATIONAL]
1800 Century Park East, Suite 900
Los Angeles, California 90067
NOTICE OF ANNUAL MEETING
TO BE HELD ON SEPTEMBER 26, 2000
Dear Stockholder:
On Tuesday, September 26, 2000, Korn/Ferry International will hold its 2000
Annual Meeting of Stockholders at the Park Hyatt Los Angeles at Century City
located at 2151 Avenue of the Stars, Los Angeles, California 90067. The
meeting will begin at 10:00 a.m.
Only stockholders who owned our common stock at the close of business on
the record date of August 2, 2000 can vote at this meeting or any adjournments
that may take place. At the meeting we will:
1. Elect three directors to serve for a three-year term;
2. Approve the amendment of our Performance Award Plan to increase the
number of shares which may be issued under the Plan and approve the
limits on the maximum number of awards that may be granted to
individuals as currently provided for in the Plan;
3. Ratify the appointment of Arthur Andersen LLP as independent auditors
for fiscal 2001; and
4. Attend to other business properly presented at the meeting.
OUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE IN FAVOR OF EACH OF THE
THREE PROPOSALS OUTLINED IN THE PROXY STATEMENT ACCOMPANYING THIS NOTICE.
The approximate date of mailing for this proxy statement and proxy cards to
all stockholders is August 21, 2000.
A quorum comprised of the holders of a majority of the outstanding shares
of our common stock on the record date must be present or represented for the
transaction of business at the meeting. Accordingly, it is important that your
shares be represented at the meeting. WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING, PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT
IN THE ENVELOPE PROVIDED.
You may revoke your proxy at any time prior to the time it is voted by (1)
notifying the Corporate Secretary in writing; (2) returning a later-dated
proxy card; or (3) attending the meeting and voting in person.
At the meeting we will also report on our fiscal 2000 business results and
other matters of interest to stockholders.
Please read the proxy materials carefully. Your vote is important and we
appreciate your cooperation in considering and acting on the matters
presented.
By Order of the Board of Directors,
/s/ Peter L. Dunn
Peter L. Dunn
Vice Chairman, General Counsel and
Corporate Secretary
August 21, 2000
Los Angeles, California
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING.... 1
PROPOSAL NO. 1--ELECTION OF DIRECTORS..................................... 4
PROPOSAL NO. 2--AMENDMENT OF THE PERFORMANCE AWARD PLAN................... 5
PROPOSAL NO. 3--RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS
INDEPENDENT AUDITORS..................................................... 8
THE BOARD OF DIRECTORS.................................................... 9
Nominees for Director--Class 2003....................................... 11
Statement on Corporate Governance....................................... 12
Directors' Compensation................................................. 12
Employment Agreements................................................... 13
Security Ownership of Certain Beneficial Owners and Management.......... 17
Certain Relationships and Transactions With Related Parties............. 18
EXECUTIVE COMPENSATION.................................................... 19
Report of the Compensation & Personnel Committee........................ 19
Summary Compensation Table.............................................. 21
Aggregated Option Exercises and Year-End Option Values.................. 22
Option Grants in Last Fiscal Year....................................... 22
Performance Graph....................................................... 23
OTHER MATTERS............................................................. 24
Section 16(a) Beneficial Ownership Reporting Compliance................. 24
Annual Report to Stockholders........................................... 24
Submission of Stockholder Proposals for Consideration and Nominations of
Persons for Election as Directors at the Annual Meeting................ 24
Stockholder Proposals for Next Year's Annual Meeting.................... 25
</TABLE>
<PAGE>
QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING
1. Q: WHY AM I RECEIVING THIS PROXY STATEMENT AND THE OTHER ENCLOSED
MATERIALS?
A: Our board is providing these materials to you in connection with, and
soliciting proxies for use at, our 2000 Annual Meeting of Stockholders,
which will take place on September 26, 2000. You are requested to vote
on each of the proposals described in this proxy statement.
2. Q: WHAT INFORMATION IS INCLUDED IN THIS MAILING?
A: The information included in this proxy statement relates to, among
other things, the proposals to be voted on at the annual meeting, the
voting process and our compensation of directors and executive
officers.
3. Q: WHAT PROPOSALS WILL BE VOTED ON AT THE ANNUAL MEETING?
A: (1) The election of three directors to serve on the board;
(2) The approval of the amendment of our Performance Award Plan to
increase the number of shares which may be issued under the Plan
and the approval of the limits on the maximum number of awards that
may be granted to individuals as currently provided for in the
Plan; and
(3) The ratification of the appointment of Arthur Andersen LLP as our
independent auditors for fiscal 2001.
4. Q: HOW DOES THE BOARD RECOMMEND I VOTE ON EACH OF THE PROPOSALS?
A: The board recommends that you vote your shares "FOR" all of its
nominees to the board, "FOR" the approval of the amendment of our
Performance Award Plan and "FOR" the proposal on independent auditors.
5. Q: WHO IS ENTITLED TO VOTE AT THE ANNUAL MEETING?
A: Holders of our common stock as of the record date, which is the close
of business on August 2, 2000, are entitled to vote at the annual
meeting.
6. Q: HOW MANY VOTES ARE PROVIDED TO EACH SHARE OF COMMON STOCK?
A: Each share of our Common Stock outstanding as of the Record Date is
entitled to one vote. As of the Record Date, 37,689,982 shares of our
common stock were issued and outstanding.
7. Q: HOW DO I VOTE?
A: You can vote either by completing, signing and dating each proxy card
you received and returning it in the envelope provided or by attending
the annual meeting and voting in person. Once you have submitted your
proxy, you have the right to revoke your proxy at any time before it is
voted by:
(1) Notifying the Corporate Secretary in writing;
(2) Returning a later-dated proxy card; OR
(3) Attending the annual meeting and voting in person.
8. Q: WHO WILL COUNT THE VOTES?
A: Representatives of ChaseMellon Shareholder Services L.L.C. will count
the votes and act as the inspector of election at the annual meeting.
9. Q: WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE PROXY CARD?
A: If your shares are registered differently and are in more than one
account, you will receive more than one proxy card. Sign and return all
proxy cards to ensure that all your shares are voted.
1
<PAGE>
10. Q: WHAT SHARES ARE INCLUDED ON THE ENCLOSED PROXY CARD(S)?
A: The shares on the enclosed proxy card(s) represent all shares owned by
you as of the Record Date (except for any shares that are held in our
401(k) plan, which shares will be voted by the trustees of the 401(k)
plan). These shares include shares (1) held directly in your name as
the "stockholder of record" and (2) held for you as the "beneficial
owner" through a stockbroker, bank or other nominee (except, as
indicated above, those shares held by the trustees on your behalf
pursuant to our 401(k) plan). If you do not return your proxy card(s),
your shares will not be voted.
11. Q: WHAT IS THE DIFFERENCE BETWEEN HOLDING SHARES AS A "STOCKHOLDER OF
RECORD" AND AS A "BENEFICIAL OWNER"?
A: "Stockholder of record": If your shares are registered directly in your
name with our transfer agent, ChaseMellon Shareholder Services L.L.C.,
you are considered, with respect to those shares, to be the stockholder
of record, and these proxy materials have been sent directly to you by
us. As the stockholder of record, you have the right to grant your
voting proxy to us or to vote in person at the annual meeting. We have
enclosed a proxy card for you to use.
"Beneficial owner": If your shares are held in a stock brokerage
account, including an Individual Retirement Account, or by a bank or
other nominee, you are considered to be the beneficial owner of shares
held in street name, and these proxy materials are being forwarded to
you by your broker or nominee, who is considered, with respect to those
shares, to be the stockholder of record. As the beneficial owner, you
have the right to direct your broker or nominee on how to vote (your
broker or nominee has enclosed a voting instruction card for you to
use) and you are invited to attend the annual meeting. However, because
you are not the stockholder of record, you may not vote your shares in
person at the annual meeting.
12. Q: WHAT IF A BENEFICIAL OWNER DOES NOT PROVIDE THE STOCKHOLDER OF RECORD
WITH VOTING INSTRUCTIONS FOR A PARTICULAR PROPOSAL?
A: If you are a beneficial owner and you do not provide the stockholder of
record with voting instructions for a particular proposal, your shares
may constitute "broker non-votes," as described below, with respect to
that proposal.
13. Q: WHAT ARE "BROKER NON-VOTES"?
A: "Broker non-votes" are shares held by a broker or nominee with respect
to which the broker or nominee does not have discretionary power to
vote on a particular proposal or with respect to which instructions
were never received from the beneficial owner. Shares which constitute
broker non-votes with respect to a particular proposal will not be
considered present and entitled to vote on that proposal at the annual
meeting, even though the same shares will be considered present for
quorum purposes and may be entitled to vote on other proposals.
14. Q: HOW ARE VOTES COUNTED?
A: In the election of directors, you may vote "FOR" all of the nominees or
your vote may be "WITHHELD" with respect to one or more of the
nominees. For the other proposals, you may vote "FOR," "AGAINST" or
"ABSTAIN." If you sign your proxy card or broker voting instruction
card without voting "FOR," "AGAINST" or "ABSTAIN" for any of the
proposals, your shares will be voted in accordance with the
recommendations of the board. With respect to Proposal Nos. 2 and 3,
abstentions will be equivalent to "AGAINST" votes, while broker non-
votes will be disregarded and will have no effect on the approval or
rejection of the proposals.
15. Q: WHAT IS THE VOTING REQUIREMENT TO APPROVE EACH PROPOSAL?
A: In order to conduct business at the annual meeting, a "quorum," as
described below, must be established. In the election of directors, the
board's three nominees will become directors so long as
2
<PAGE>
they receive a plurality of "FOR" votes; however, if any additional
nominees for director are properly brought before the stockholders for
consideration, only the three nominees who receive the highest number
of "FOR" votes will become directors. Approval of Proposal No. 2
(relating to the amendment of the Performance Award Plan) and Proposal
No. 3 (relating to ratification of the auditors appointed by the
board), will require affirmative "FOR" votes from a majority of those
shares present (either in person or by proxy) and entitled to vote at
the annual meeting.
16. Q: WHAT IS A "QUORUM"?
A: A "quorum" is a majority of the holders of the outstanding shares
entitled to vote. A quorum must be present or represented by proxy at
the annual meeting for business to be conducted. Abstentions and broker
non-votes will be counted as present for quorum purposes.
17. Q: WHAT HAPPENS IF ADDITIONAL MATTERS (OTHER THAN THE PROPOSALS DESCRIBED
IN THIS PROXY STATEMENT) ARE PRESENTED AT THE ANNUAL MEETING?
A: The board is not aware of any additional matters to be presented for a
vote at the annual meeting; however, if any additional matters are
properly presented at the annual meeting, your signed proxy card gives
authority to Peter L. Dunn and Elizabeth S.C.S. Murray to vote on those
matters in their discretion.
18. Q: HOW MUCH DID THIS PROXY SOLICITATION COST?
A: We hired ChaseMellon Shareholder Services L.L.C. to assist in the
distribution of proxy materials and solicitation of votes for
approximately $7,000, including out-of-pocket expenses. We also
reimburse brokerage houses and other custodians, nominees and
fiduciaries for their reasonable out-of-pocket expenses for forwarding
proxy and solicitation materials to beneficial owners.
19. Q: CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD?
A: Yes. You may change your vote at any time before the proxy is exercised
by:
(1) notifying the Corporate Secretary of Korn/Ferry in writing;
(2) returning a later-dated proxy card; or
(3) attending the annual meeting and voting in person.
3
<PAGE>
PROPOSAL NO. 1--ELECTION OF DIRECTORS
There is a total of three nominees for election as directors, each to serve
for a term of three years. The nominees for election at the annual meeting to
serve as Class 2003 Directors are Patti S. Hart, Windle B. Priem and Mark C.
Thompson. Detailed information regarding each of these three nominees is
provided on page 11 of this proxy statement. We do not expect any of the three
nominees to become unavailable to stand for election, but, should this happen,
the board will designate a substitute for each unavailable nominee. Proxies
voting for any unavailable nominee will be cast for that nominee's substitute.
REQUIRED VOTE
The board's three nominees will become directors so long as they receive a
plurality of "FOR" votes; however, if any additional nominees for director are
properly brought before the stockholders for consideration, only the three
nominees who receive the highest number of "FOR" votes will become directors.
RECOMMENDATION OF THE BOARD
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" ALL OF ITS THREE NOMINEES FOR
DIRECTOR.
4
<PAGE>
PROPOSAL NO. 2--AMENDMENT OF THE PERFORMANCE AWARD PLAN
Our Performance Award Plan, or the Plan, was adopted by our board and
approved by our shareholders in August 1998. Our board has adopted and
recommends that you approve an amendment to the Plan that would increase the
maximum number of shares of common stock that may be delivered pursuant to
awards granted under the Plan from 7,000,000 to 13,000,000, representing an
amount equal to approximately 35% of our outstanding shares of common stock on
the date hereof. Our board also recommends that you approve the limits, as
described below, on the maximum number of awards that may be granted to
individuals as currently set forth in the Plan. The approval of these limits
will enable us to continue to be entitled to federal tax deductions with
respect to awards of stock options and performance based compensation under
the Plan. A summary of the Plan, as amended, is set forth below.
The purpose of the Plan is to promote our success and the interests of our
stockholders by attracting, motivating, retaining and rewarding directors,
officers, employees and other eligible persons with awards and incentives for
high levels of individual performance and improved company financial
performance; to attract, motivate and retain experienced and knowledgeable
independent directors through the benefits provided under the Plan; and to
further align their respective interests with those of our stockholders
through awards of stock-based incentives. The granting of performance awards
pursuant to the Plan has been and will continue to be an important part of the
compensation of our employees.
Awards under the Plan may be in the form of nonqualified stock options,
incentive stock options, stock appreciation rights, or SARs, restricted stock,
performance shares, stock bonuses, or cash bonuses based on performance.
Awards may be granted individually or in combination with other awards. Any
cash bonuses and other performance awards under the Plan will depend upon the
extent to which performance goals set by our board or the Compensation
Committee are met during the performance period. Awards under the Plan
generally will be nontransferable by the holder of the award (other than by
will or the laws of descent and distribution). During the holder's lifetime,
rights under the Plan generally will be exercisable only by the holder,
subject to such exceptions as may be authorized by the Compensation Committee
in accordance with the Plan. No incentive stock option may be granted at a
price that is less than the fair market value of the common stock (110% of
fair market value of the common stock for certain participants) on the date of
grant. Nonqualified stock options and other awards may be granted at prices
below the fair market value of the common stock on the date of grant.
Restricted stock awards can be issued for nominal or the minimum lawful
consideration. Typically, the participant may vote restricted stock, but any
dividend on restricted shares will be held in escrow subject to forfeiture
until the shares have vested. No more than 350,000 shares will be available
for restricted stock awards, subject to exceptions for restricted stock awards
based on past service, deferred compensation and performance awards.
The maximum number of shares subject to those options and SARs that are
granted during any one calendar year to any one individual is limited to
700,000 shares while the maximum number of shares subject to all awards
(either performance or otherwise) that may be granted to an individual in the
aggregate in any one calendar year is 1,050,000. A non-employee director may
not receive awards in respect of more than 50,000 shares in the aggregate in
any one calendar year. With respect to cash-based performance awards, no more
than $2.5 million per year, per performance cycle may be awarded to any one
individual. No more than one performance cycle may begin in any one year with
respect to cash-based performance awards.
Section 162(m) Performance-Based Awards. In addition to options and SARs
granted under other provisions of the Plan, performance-based awards payable
in cash or shares within the meaning of Section 162(m) of the Internal Revenue
Code of 1986, as amended, which depend on the achievement of pre-established
financial performance goals, may be granted under the Plan. The specific
performance goals will be set by a qualified committee of our board created
for these purposes and the specific targets will be set by the Compensation
Committee when their attainment is substantially uncertain. The permitted
performance goals under the Plan may include any one or more of the following:
revenue growth, net earnings (before or after taxes or before or after
interest, taxes, depreciation and amortization), cash flow, return on equity,
return on assets or
5
<PAGE>
return on net investment, or cost containment or reduction. The applicable
performance cycle may not be less than one nor more than ten years, or five
years in respect of such awards payable only in cash.
Administration. The Plan will be administered by our board or the
Compensation Committee. The Compensation Committee will have broad authority
to:
. designate recipients of discretionary awards,
. determine or modify (subject to any required consent) the terms and
provisions of awards, including the price, vesting provisions, terms of
exercise and expiration dates,
. approve the form of award agreements,
. determine specific objectives and performance criteria with respect to
performance awards, and
. construe and interpret the Plan.
The Compensation Committee will have the discretion to accelerate and
extend the exercisability or term and establish the events of termination or
reversion of outstanding awards.
Change in Control. Upon a Change in Control Event, each option and SAR will
become immediately exercisable; restricted stock will immediately vest free of
restrictions; and the number of shares, cash or other property covered by each
performance share award will be issued to the holder, unless the Compensation
Committee determines to the contrary. A "Change in Control Event" is defined
generally to include
. certain changes in a majority of the membership of our board over a
period of two years or less,
. the acquisition of more than 30% of our outstanding voting securities by
any person other than us, any of our benefit plans or one of their
affiliates, successors, heirs, relatives or certain donees or certain
other affiliates, or
. shareholder approval of a transfer of substantially all of our assets,
the dissolution or liquidation of us, or a merger, consolidation or
reorganization (other than with an affiliate) whereby stockholders hold
or receive less than 70% of the outstanding voting securities of the
resulting entity after such event.
In addition, if any participant's employment is terminated by us for any
reason other than for cause either in express anticipation of, or within one
year after a Change in Control Event, then all awards held by that participant
will vest in full immediately before his or her termination date
The Compensation Committee may also provide for alternative settlements
(including cash payments), the assumption or substitution of awards or other
adjustments in the Change in Control context of any other reorganization of
us.
Plan Amendment, Termination and Term. Our board has the authority to amend,
suspend or discontinue the Plan at any time, but no such action will affect
any outstanding award in any manner materially adverse to a participant
without the consent of the participant. The Plan may be amended by our board
without stockholder approval unless such approval is required by applicable
law.
The Plan will remain in existence as to all outstanding awards until such
awards are exercised or terminated. The maximum term of options, SARs and
other rights to acquire common stock under the Plan is ten years after the
initial date of award, subject to provisions for further deferred payment in
certain circumstances. No award can be made after August 4, 2008. Awards may
remain exercisable for a period of time determined by the Compensation
Committee after termination of employment for certain reasons, after which, to
the extent not exercised, such awards terminate.
Automatic Grants to Non-Employee Directors. Under the Plan, each director
who is not an officer or employee and who is or thereafter becomes a director
will be automatically granted a nonqualified stock option
6
<PAGE>
to purchase 2,000 shares of common stock when the person takes office, at an
exercise price equal to the market price of the common stock at the close of
trading on that date. In addition, on the day of the annual shareholders
meeting in each calendar year beginning in 1999 and continuing for each
subsequent year during the term of the Plan, each then-continuing non-employee
director will be granted a nonqualified stock option to purchase 2,000 shares
of common stock at an exercise price equal to the market price of the common
stock at the close of trading on that date. Non-employee directors may also be
granted discretionary awards. All automatically granted non-employee director
stock options will have a ten-year term and will be immediately exercisable.
If a non-employee director's services are terminated for any reason, any
automatically granted stock options held by such non-employee director that
are exercisable will remain exercisable for twelve months after such
termination of service or until the expiration of the option term, whichever
occurs first. Automatically-granted options are subject to the same
adjustment, change in control, and acceleration provisions that apply to
awards generally, except that any changes or board or Compensation Committee
actions (1) will be effected through a stockholder approved reorganization
agreement or will be consistent with the effect on Options held by other than
executive officers and (2) will be consistent in respect of the underlying
shares with the effect on stockholders generally. Any outstanding automatic
option grant that is not exercised prior to a Change in Control Event in which
we are not to survive will terminate, unless such option is assumed or
replaced by the surviving corporation.
Payment for Shares. The exercise price of options and other awards may be
paid in cash, promissory note or (subject to certain restrictions) shares of
common stock. We may finance the exercise or purchase and (subject to any
applicable legal limits) offset shares to cover the exercise or purchase price
and withholding taxes.
Federal Tax Consequences. The current federal income tax consequences of
awards authorized under the Plan follow certain basic patterns. Generally,
awards under the Plan that are includable in income of the recipient at the
time of award or exercise (such as nonqualified stock options, SARs,
restricted stock and performance awards) are deductible by us, and awards that
are not required to be included in income of the recipient at such times (such
as incentive stock options) are not deductible by us.
Non-Exclusive Plan. The Plan is not exclusive. Our board may grant stock
and performance incentives or other compensation, in stock or cash, under
other plans or authority.
Our board believes it would be in the best interests of us and our
stockholders to amend the Plan to increase the number of shares available for
grant thereunder as described herein and to approve the limits on the maximum
number of awards that may be granted to individuals as currently set forth in
the Plan. There are several years remaining in the life of the Plan as awards
can be made under the Plan until August 4, 2008. Increasing the number of
shares we are authorized to issue will help ensure that we will be able to
continue to grant awards during the life of the Plan. This will enable us to
further fulfill the purpose of the Plan and provide us with greater
flexibility in making awards which we continue to believe is an important
component of compensation and is necessary to attract and retain outstanding
employees. Except as so amended by this Proposal No. 2, the Plan will continue
unchanged and in full force and effect.
REQUIRED VOTE
Approval of the amendment to the Plan and the approval of the limits on the
maximum number of awards that may be granted to individuals will require
affirmative "FOR" votes from a majority of those shares present, either in
person or by proxy, and entitled to vote at the annual meeting.
RECOMMENDATION OF THE BOARD
OUR BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE APPROVAL OF THIS PROPOSAL
NO. 2 RELATING TO THE PLAN.
7
<PAGE>
PROPOSAL NO. 3--RATIFICATION OF THE APPOINTMENT
OF ARTHUR ANDERSEN LLP AS INDEPENDENT AUDITORS
The audit committee has recommended, and the board has approved, the
appointment of Arthur Andersen LLP as our independent auditors for fiscal
2001. Arthur Andersen has served as our independent auditors since 1971,
including assisting us with accounting matters relating to the initial public
offering of our common stock. They have unrestricted access to the audit
committee to discuss audit findings and other financial matters.
Representatives of Arthur Andersen will attend the annual meeting to answer
appropriate questions and may also make a statement if they so desire.
Audit services provided by Arthur Andersen during fiscal 2000 included an
audit of our consolidated financial statements and consultation on various tax
and accounting matters.
REQUIRED VOTE
Ratification of the auditors appointed by the board will require
affirmative "FOR" votes from a majority of those shares present, either in
person or by proxy, and entitled to vote at the annual meeting.
RECOMMENDATION OF THE BOARD
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE RATIFICATION OF ARTHUR
ANDERSEN'S APPOINTMENT AS INDEPENDENT AUDITORS FOR FISCAL 2001.
8
<PAGE>
THE BOARD OF DIRECTORS
The twelve members of our board of directors are grouped into three
classes: Class 2001 Directors will serve until the 2001 Annual Meeting of
Stockholders, Class 2002 Directors will serve until the 2002 Annual Meeting of
Stockholders and the Directors elected to serve as Class 2003 will serve until
the 2003 Annual Meeting of Stockholders.
CLASS 2001 DIRECTORS
The following table sets forth information regarding the Class 2001
Directors, who will serve on the board until the 2001 annual meeting of
stockholders:
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE LAST FIVE YEARS SINCE
---- --- --------------- --------
<C> <C> <S> <C>
James E. Barlett 56 Mr. Barlett is Chairman, President and Chief 1999
Executive Officer of Galileo International.
From 1994 to 1997, Mr. Barlett was President
and Chief Executive Officer of Galileo
International. Mr. Barlett is also a director
of TeleTech Holdings, Inc.
Richard M. Ferry 62 Mr. Ferry is a founder of Korn/Ferry 1969
International, has been Chairman of the board
since 1991 and is also a member of the Office
of the Chief Executive. Mr. Ferry served as
Chief Executive Officer from May 1991 to April
1997. He also serves on the Board of Directors
of Avery Dennison Corp., Dole Food Company,
Mrs. Fields' Original Cookies, Inc., and
Pacific Life Insurance Company.
Timothy K. Friar 42 Mr. Friar has been a Vice President since 1998
1995. He is currently responsible for managing
our New York, Princeton and Philadelphia
offices. He also serves on our Professional
Development Committee. Mr. Friar joined us in
1993 and has eight years of executive search
experience.
Sakie Fukushima 50 Ms. Fukushima has been a Vice President since 1995
1993. She is currently responsible for our
Consumer/Entertainment Practice in Japan.
Ms. Fukushima joined us in 1991 and has nine
years of executive search experience.
Scott E. Kingdom 41 Mr. Kingdom has been a Vice President since 1998
1993. He is currently responsible for managing
our Austin, Chicago, Dallas, Denver, Houston,
and Minneapolis offices and for executing
senior level search engagements. Mr. Kingdom
joined us in 1988 and has 13 years of
executive search experience.
</TABLE>
9
<PAGE>
CLASS 2002 DIRECTORS
The following table sets forth certain information regarding the Class 2002
Directors, who will serve on the board until the 2002 annual meeting of
stockholders:
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE LAST FIVE YEARS SINCE
---- --- --------------- --------
<C> <C> <S> <C>
Frank V. Cahouet 68 Mr. Cahouet retired as Chairman, President 1999
and Chief Executive Officer of Mellon
Financial Corporation in 1998, positions
which he had held since 1987. Mr. Cahouet is
a director of Avery Dennison Corporation,
Allegheny Technologies Inc., Teledyne
Technologies Inc., and Saint-Gobain
Corporation.
Peter L. Dunn 55 Mr. Dunn serves as Vice Chair and General 1992
Counsel and is also a member of the Office
of the Chief Executive. Mr. Dunn also serves
as Corporate Secretary. Mr. Dunn joined us
in 1980. Mr. Dunn is currently also the
acting Chief Executive Officer of
Futurestep, a subsidiary of ours.
Charles D. Miller 72 Mr. Miller retired as Chairman of 1999
Avery Dennison Corporation in April 2000.
From April 1983 through April 1998,
Mr. Miller was Chairman and Chief Executive
Officer of Avery Dennison Corporation. Mr.
Miller is also Chairman of Nationwide Health
Properties, Inc. and a director of The Air
Group, Avery Dennison Corporation, Edison
International, and Pacific Life Insurance
Company.
Gerhard Schulmeyer 61 Mr. Schulmeyer is President and Chief 1999
Executive Officer of Siemens Corporation.
From 1994 through 1998, Mr. Schulmeyer was
President and Chief Executive Officer of
Siemens Nixdorf, Munich/Paderborn.
Mr. Schulmeyer is also a director of
Alcan Aluminium Ltd., Allied Zurich p.l.c.,
FirePond, Inc., and Ingram Micro Inc.
</TABLE>
10
<PAGE>
NOMINEES FOR CLASS 2003 DIRECTORS
The following table sets forth certain information regarding the Class 2003
Directors, who, if elected at the 2000 annual meeting, will serve the board
until the 2003 annual meeting of stockholders:
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE LAST FIVE YEARS SINCE
---- --- --------------- ---------
<C> <C> <S> <C>
Patti S. Hart 44 Ms. Hart is President and Chief Executive (Director
Officer of Telocity, Inc. From 1994 through Nominee)
1999, Ms. Hart was President and Chief
Operating Officer of Sprint's Long Distance
Division. Ms. Hart is also a director of
Telocity, Inc., Brigade Solutions, Mariner
Networks and Plantronics.
Windle B. Priem 62 Mr. Priem has been Chief Executive Officer 1993
and President since December 1998 and is a
member of the Office of the Chief Executive.
From May 1997 to December 1998, he served as
Vice Chairman and Chief Operating Officer.
From May 1995 to May 1997, he was the
President of the North America region. Mr.
Priem joined us in 1976 and has 24 years of
executive search experience.
Mark C. Thompson 42 Mr. Thompson is Chairman of Integration (Director
Technology, Inc. From 1988 to 2000, he was an Nominee)
officer of The Charles Schwab Corporation,
where he was most recently Executive Producer
and Senior Vice President. Mr. Thompson is
also a director of Integration Associates,
Inc., Best Buy Co., Inc., Eloquent, Inc.,
Esurance, Inc., Interwoven, Inc.,
Investorplus.com, and Rioport, Inc.
</TABLE>
11
<PAGE>
STATEMENT ON CORPORATE GOVERNANCE
The board held nine meetings during fiscal 2000, and all of the directors
attended at least 75% of the board meetings and committee meetings of which
they were members.
Although the full board considers all major decisions, the Bylaws permit
the board to have the following standing committees to more fully address
certain areas of importance: an audit committee, a compensation and personnel
committee, and a nominating committee. The members of the current standing
committees are:
<TABLE>
<CAPTION>
COMPENSATION AND
NAME AUDIT PERSONNEL NOMINATING
<S> <C> <C> <C>
James E. Barlett X X(Chair)
Frank V. Cahouet X(Chair) X
Charles D. Miller X X(Chair)
Gerhard Schulmeyer X X
</TABLE>
Audit Committee. The audit committee makes recommendations concerning the
engagement of independent auditors, reviews the plans and results of the audit
engagement with the independent auditors, approves professional services
provided by the independent auditors, reviews the independence of the
auditors, considers the range of audit and non-audit fees, reviews the
adequacy of our internal accounting controls and ensures the integrity of
financial information supplied to stockholders. The audit committee is also
available to receive reports, suggestions, questions and recommendations from
the independent auditors, the Chief Financial Officer and the General Counsel.
It also confers with those parties in order to assure the sufficiency and
effectiveness of the programs being followed by corporate officers in the area
of compliance with the law and conflicts of interest. The audit committee is
composed entirely of outside directors. The audit committee met twice in
fiscal 2000.
Compensation and Personnel Committee. The compensation and personnel
committee determines the compensation of our executive officers and
administers the Performance Award Plan. In addition, the compensation and
personnel committee reviews and makes recommendations to the board with
respect to our overall compensation program for managing directors, vice
presidents and other employees, including salaries, employee benefit plans,
stock option grants, and payment of bonuses. The compensation and personnel
committee is composed entirely of outside directors. The compensation and
personnel committee met three times during fiscal 2000.
Nominating Committee. The nominating committee recommends criteria to the
board for the selection of nominees to the board, evaluates all proposed
nominees, recommends nominees to the board to fill vacancies on the board,
and, prior to each annual meeting of stockholders, recommends to the board a
slate of nominees for election to the board by the stockholders at the annual
meeting. The nominating committee also seeks possible nominees for the board
and otherwise serves to aid in attracting qualified nominees to be elected to
the board. The nominating committee is composed of two outside directors, with
four inside directors as ex-officio members. The nominating committee met once
in fiscal 2000.
DIRECTORS' COMPENSATION
Directors who are also employees or officers do not receive any additional
compensation for their service on the board. Non-employee directors receive a
$25,000 annual retainer in cash, $4,000 for each committee chair and up to
$1,000 in cash for each regular or special meeting attended. In addition, all
directors are reimbursed for their out-of-pocket expenses incurred in
connection with their duties as directors.
Directors who are not officers or employees are eligible to receive annual
stock option grants under our Performance Award Plan. Under the Performance
Award Plan, a non-employee director is automatically granted a nonqualified
stock option to purchase 2,000 shares of common stock when the person takes
office, at an
12
<PAGE>
exercise price equal to the market price of the Common Stock at the close of
trading on that date. In addition, on the day of the annual stockholders
meeting in each calendar year, beginning with the Annual Meeting and
continuing for each subsequent year during the term of the Performance Award
Plan, each continuing non-employee director will be granted a nonqualified
stock option to purchase 2,000 shares of common stock at an exercise price
equal to the market price of the common stock at the close of trading on that
date. Non-employee directors may also be granted discretionary awards. All
automatically granted non-employee director stock options will have a ten-year
term and will be immediately exercisable. If a non-employee director's
services are terminated for any reason, any automatically granted stock
options held by the non-employee director that are exercisable will remain
exercisable for twelve months after such termination of service or until the
expiration of the option term, whichever occurs first. Automatically-granted
options are subject to the same adjustment, change in control, and
acceleration provisions that apply to awards generally, except that any
changes or board or committee actions (1) will be effected through a
stockholder approved reorganization agreement or will be consistent with the
effect on options held by other than executive officers and (2) will be
consistent in respect of the underlying shares with the effect on stockholders
generally. Any outstanding automatic option grant that is not exercised prior
to a change in control event in which Korn/Ferry is not to survive will
terminate, unless the option is assumed or replaced by the surviving
corporation.
EMPLOYMENT AGREEMENTS
Windle B. Priem, Chief Executive Officer and President. In June 1999, we
entered into an employment agreement with Windle B. Priem as Chief Executive
Officer and President, effective May 1, 1999. The term of the agreement is for
three years, with one renewal term for a two-year period. The agreement
provides for a minimum base salary of $600,000 annually, with an annual target
bonus equal to 100% of base salary and an annual maximum bonus of up to 200%
of base salary.
If Mr. Priem's employment terminates due to death or disability, then we
will pay Mr. Priem, or his legal representatives, all accrued compensation as
of the date of termination and all of Mr. Priem's outstanding stock options as
of the effective date of the employment agreement will vest and remain
exercisable until their originally scheduled expiration dates. If Mr. Priem's
employment is terminated by us for cause, terminated by Mr. Priem prior to its
expiration or Mr. Priem fails to renew the agreement after its initial term,
then we will pay Mr. Priem all accrued compensation as of the date of
termination.
Prior to a change in control, if Mr. Priem's employment is terminated by us
without cause, terminated by Mr. Priem for good reason or we fail to renew the
agreement, then we will pay Mr. Priem all accrued compensation as of the date
of termination, a lump sum equal to 200% of the then base salary and target
bonus and all of Mr. Priem's outstanding stock options as of the effective
date of the employment agreement will vest and remain exercisable for their
originally scheduled expiration dates. Following a change in control, if
Mr. Priem's employment is terminated by us without cause or by Mr. Priem for
good reason, then we will pay Mr. Priem all accrued compensation as of the
date of termination, a lump sum equal to 200% of then base salary and maximum
bonus in effect immediately prior to the date of termination or the then base
salary and maximum bonus applicable to Mr. Priem just prior to the change in
control event, whichever is higher, all of Mr. Priem's outstanding stock
options as of the effective date of the employment agreement will vest and
remain exercisable for their originally scheduled expiration dates.
In connection with the execution of the employment agreement in June 1999,
the board of directors also granted Mr. Priem an option to purchase 100,000
shares of the Company's Common Stock at an exercise price of $13.6875 per
share. The option will expire on September 2, 2004, unless earlier terminated
as provided below. The option agreement provided for vesting upon the earlier
to occur of:
(1) the stock price of the Company remaining at or above $18 per share
for 10 consecutive trading days during the period between the grant date
and the second anniversary of the grant date;
(2) the stock price remaining at or above $20 per share for 10
consecutive trading days during the period between the second anniversary
of the grant date and the third anniversary of the grant date;
13
<PAGE>
(3) the expiration of the initial term of Mr. Priem's employment
agreement and the Company elects not to renew for an additional term;
(4) death or disability of Mr. Priem;
(5) termination of Mr. Priem's employment by us without cause or by Mr.
Priem for good reason; or
(6) expiration of the additional two-year renewal period of the
employment agreement. The option did vest on October 6, 1999 under
alternative (1) set forth above.
The option has been exercisable since October 6, 1999 and at any time prior
to the expiration; provided that the option will terminate, and not be
exercisable, prior to the expiration date under the following circumstances:
upon death, disability or retirement, the option will expire 12 months
following the date of termination unless the option has expired earlier and
upon termination of Mr. Priem's employment for any reason (other than for
death, disability or retirement), the option will expire 3 months following the
date of termination.
Peter L. Dunn, Vice Chair and General Counsel. In June 1999, we entered into
an employment agreement with Peter L. Dunn as Vice Chair and General Counsel,
effective April 29, 1999. The term of the agreement is for three years, and
will automatically renew for successive two-year periods thereafter until the
first April 30th following the date on which Mr. Dunn reaches age 65; provided,
however, that either we or Mr. Dunn may terminate this agreement at the end of
the initial term or renewal term by delivering to the other party at least 120
days' prior written notice. The agreement provides for a minimum base salary of
$465,000 annually, with an annual target bonus equal to 100% of base salary and
an annual maximum bonus of up to 200% of base salary.
If Mr. Dunn's employment terminates due to death or disability, then we will
pay Mr. Dunn, or his legal representatives, all accrued compensation as of the
date of termination and all of Mr. Dunn's outstanding stock options as of the
effective date of the employment agreement will vest and remain exercisable
until their originally scheduled expiration dates. If Mr. Dunn's employment is
terminated by the Company for cause, terminated by Mr. Dunn prior to its
expiration without good reason or Mr. Dunn fails to renew the agreement after
its initial term, then we will pay Mr. Dunn all accrued compensation as of the
date of termination.
Prior to a change in control, if Mr. Dunn's employment is terminated by us
without cause, terminated by Mr. Dunn for good reason or we fail to renew the
agreement, then we will pay Mr. Dunn all accrued compensation as of the date of
termination, a lump sum equal to 200% of the then base salary and target bonus;
provided however that if Mr. Dunn's employment is terminated because the
Company elects not to renew the agreement, then Mr. Dunn shall be entitled only
to a lump sum equal to one times the then base salary and target bonus and all
of Mr. Dunn's outstanding stock options as of the effective date of the
employment agreement will vest and will remain exercisable until their
originally scheduled expiration dates. Prior to a change in control, if Mr.
Dunn's employment is terminated by us for performance reasons, then we will pay
Mr. Dunn all accrued compensation as of the date of termination, a lump sum
equal to one and one-half times the then base salary and target bonus and all
of Mr. Dunn's outstanding stock options as of the effective date of the
employment agreement will vest.
Following a change in control and if within 12 months after the date on
which the change in control occurs Mr. Dunn's employment is terminated by us
without cause, by us because we elect not to renew the agreement, by us for a
performance reason, or by Mr. Dunn for good reason, then we will pay Mr. Dunn
all accrued compensation as of the date of termination, a lump sum equal to (1)
200% of the then base salary or 200% of the annual base salary in effect just
prior to the change in control, whichever amount is higher, plus (2) the higher
of 200% of the maximum bonus for the incentive year in which such termination
occurs or 200% of the maximum bonus for the preceding fiscal year and all of
Mr. Dunn's outstanding stock options as of the effective date of the employment
agreement will vest and will remain exercisable until their originally
scheduled expiration dates.
14
<PAGE>
Elizabeth S.C.S. Murray, Chief Financial Officer and Executive Vice
President. In June 1999, we entered into an employment agreement with
Elizabeth S.C.S. Murray as Chief Financial Officer and Executive Vice
President, effective April 29, 1999. The term of the agreement is for three
years, and will automatically renew for successive two-year periods thereafter
until the first April 30th following the date on which Ms. Murray reaches age
65; provided, however, that either we or Ms. Murray may terminate this
agreement at the end of the initial term or renewal term by delivering to the
other party at least 120 days' prior written notice. The agreement provides
for a minimum base salary of $350,000 annually, with an annual target bonus
equal to 100% of base salary and an annual maximum bonus of up to 200% of base
salary.
If Ms. Murray's employment terminates due to death or disability, then we
will pay Ms. Murray, or her legal representatives, all accrued compensation as
of the date of termination and all of Ms. Murray's outstanding stock options
as of the effective date of the employment agreement will vest and will remain
exercisable until their originally scheduled expiration dates. If Ms. Murray's
employment is terminated by us for cause, terminated by Ms. Murray prior to
its expiration without good reason or Ms. Murray fails to renew the agreement
after its initial term, then we will pay Ms. Murray all accrued compensation
as of the date of termination.
Prior to a change in control of the Company, if Ms. Murray's employment is
terminated by us without cause, terminated by Ms. Murray for good reason or we
fail to renew the agreement, then we will pay Ms. Murray all accrued
compensation as of the date of termination, a lump sum equal to 200% of the
then base salary and target bonus; provided however that if Ms. Murray's
employment is terminated because the Company elects not to renew the
agreement, then Ms. Murray shall be entitled only to a lump sum equal to one
times the then base salary and target bonus and all of Ms. Murray's
outstanding stock options as of the effective date of the employment agreement
will vest and will remain exercisable until their originally scheduled
expiration dates. Prior to a change in control of the Company, if Ms. Murray's
employment is terminated by us for performance reasons, then we will pay Ms.
Murray all accrued compensation as of the date of termination, a lump sum
equal to the then base salary and target bonus and all of Ms. Murray's
outstanding stock options as of the effective date of the employment agreement
will vest and will remain exercisable until their originally scheduled
expiration dates.
Following a change in control and if within 12 months after the date on
which the change in control occurs Ms. Murray's employment is terminated by
the Company without cause, by us because we elect not to renew the agreement,
by us for a performance reason, or by Ms. Murray for good reason, then we will
pay Ms. Murray all accrued compensation as of the date of termination, a lump
sum equal to (1) 200% of then base salary or 200% of the annual base salary in
effect just prior to the Change in Control, whichever amount is higher, and
(2) the higher of 200% of the maximum bonus for the incentive year in which
such termination occurs or 200% of the maximum bonus for the preceding fiscal
year and all of Ms. Murray's outstanding stock options as of the effective
date of the employment agreement will vest and will remain exercisable until
their originally scheduled expiration dates.
Gary C. Hourihan, Executive Vice President, Organizational Development. In
March 2000, we entered into an employment agreement with Gary C. Hourihan as
Executive Vice President, Organizational Development, effective March 6, 2000.
The initial term of the agreement is through April 30, 2002 and the term will
automatically renew for successive two-year periods thereafter until the first
April 30th following the date on which Mr. Hourihan reaches age 65; provided,
however, that either we or Mr. Hourihan may terminate this agreement at the
end of the initial term or renewal term by delivering to the other party at
least 120 days' prior written notice. The agreement provides for a minimum
base salary of $340,000 annually, with an annual target bonus equal to 100% of
base salary and an annual maximum bonus of up to 200% of base salary.
If Mr. Hourihan's employment terminates due to death or disability, then we
will pay Mr. Hourihan, or his legal representatives, all accrued compensation
as of the date of termination and all of Mr. Hourihan's outstanding stock
options as of the effective date of the employment agreement will vest and
will remain exercisable until their originally scheduled expiration dates. If
Mr. Hourihan's employment is terminated by us for cause, terminated by Mr.
Hourihan prior to its expiration without good reason or Mr. Hourihan fails to
renew
15
<PAGE>
the agreement after its initial term, then we will pay Mr. Hourihan all
accrued compensation as of the date of termination.
Prior to a change in control, if Mr. Hourihan's employment is terminated by
us without cause, terminated by Mr. Hourihan for good reason or we fail to
renew the agreement, then we will pay Mr. Hourihan all accrued compensation as
of the date of termination, a lump sum equal to 150% of the then base salary
and target bonus; provided however that if Mr. Hourihan's employment is
terminated because we elect not to renew the agreement, then Mr. Hourihan
shall be entitled only to a lump sum equal to one times the then base salary
and target bonus and all of Mr. Hourihan's outstanding stock options as of the
effective date of the employment agreement will vest and will remain
exercisable until their originally scheduled expiration dates. Prior to a
change in control, if Mr. Hourihan's employment is terminated by us for
performance reasons, then we will pay Mr. Hourihan all accrued compensation as
of the date of termination, a lump sum equal to the then base salary and
target bonus and all of Mr. Hourihan's outstanding stock options as of the
effective date of the employment agreement will vest and will remain
exercisable until their originally scheduled expiration dates.
Following a change in control and if within 12 months after the date on
which the change in control occurs Mr. Hourihan's employment is terminated by
us without cause, by us because we elect not to renew the agreement, by us for
a performance reason, or by Mr. Hourihan for good reason, then we will pay Mr.
Hourihan all accrued compensation as of the date of termination, a lump sum
equal to (1) 200% of then base salary or 200% of the annual base salary in
effect just prior to the change in control, whichever amount is higher, and
(2) the higher of 200% of the maximum bonus for the incentive year in which
such termination occurs or 200% of the maximum bonus for the preceding fiscal
year and all of Mr. Hourihan's outstanding stock options as of the effective
date of the employment agreement will vest and will remain exercisable until
their originally scheduled expiration dates.
Michael D. Bekins, Chief Operating Officer. We entered into an employment
agreement with Michael D. Bekins as Chief Operating Officer of the Company,
effective May 1, 2000. The term of the agreement is for three years, and will
automatically renew for successive two-year periods thereafter until the first
April 30th following the date on which Mr. Bekins reaches age 65; provided,
however, that either we or Mr. Bekins may terminate this agreement at the end
of the initial term or renewal term by delivering to the other party at least
120 days' prior written notice. The agreement provides for a minimum base
salary of $450,000 annually, with an annual target bonus equal to 100% of base
salary and an annual maximum bonus of up to 200% of base salary.
If Mr. Bekins' employment terminates due to death or disability, then we
will pay Mr. Bekins, or his legal representatives, all accrued compensation as
of the date of termination and all of Mr. Bekins' outstanding stock options as
of the effective date of the employment agreement will vest and will remain
exercisable until their originally scheduled expiration dates. If Mr. Bekins'
employment is terminated by us for cause, terminated by Mr. Bekins prior to
its expiration without good reason or Mr. Bekins fails to renew the agreement
after its initial term, then we will pay Mr. Bekins all accrued compensation
as of the date of termination.
Prior to a change in control, if Mr. Bekins' employment is terminated by us
without cause, terminated by Mr. Bekins for good reason or we fail to renew
the agreement, then we will pay Mr. Bekins all accrued compensation as of the
date of termination, a lump sum equal to 200% of the then base salary and
target bonus; provided however that if Mr. Bekins' employment is terminated
because the Company elects not to renew the agreement, then Mr. Bekins shall
be entitled only to a lump sum equal to one times the then base salary and
target bonus and all of Mr. Bekins' outstanding stock options as of the
effective date of the employment agreement will vest and will remain
exercisable until their originally scheduled expiration dates. Prior to a
change in control, if Mr. Bekins' employment is terminated by us for
performance reasons, then we will pay Mr. Bekins all accrued compensation as
of the date of termination, a lump sum equal to the then base salary and
target bonus and all of Mr. Bekins' outstanding stock options as of the
effective date of the employment agreement will vest and will remain
exercisable until their originally scheduled expiration dates.
16
<PAGE>
Following a change in control and if within 12 months after the date on
which the change in control occurs Mr. Bekins' employment is terminated by us
without cause, by us because we elect not to renew the agreement, by us for a
performance reason, or by Mr. Bekins for good reason, then we will pay Mr.
Bekins all accrued compensation as of the date of termination, a lump sum
equal to (1) 200% of then base salary or 200% of the annual base salary in
effect just prior to the change in control, whichever amount is higher, and
(2) the higher of 200% of the maximum bonus for the incentive year in which
such termination occurs or 200% of the maximum bonus for the preceding fiscal
year and all of Mr. Bekins' outstanding stock options as of the effective date
of the employment agreement will vest and will remain exercisable until their
originally scheduled expiration dates.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of August 2, 2000 the names and holdings
of each director and each nominee for director, the names and holdings of each
executive officer named in the Summary Compensation Table (the "NAMED
EXECUTIVE OFFICERS"), and the holdings of all executive officers and directors
as a group. There are no persons known to us to be beneficial owners of more
than 5% of our common stock.
<TABLE>
<CAPTION>
NAME OF AMOUNT BENEFICIALLY OWNED AND
BENEFICIAL OWNER NATURE OF BENEFICIAL OWNERSHIP (12) PERCENT OF CLASS
<S> <C> <C>
Richard M. Ferry 1,031,456(1) 2.72%
Windle B. Priem 736,084(2) 1.94%
Peter L. Dunn 343,543(3) 0.91%
James E. Barlett 2,000(4) 0.01%
Frank V. Cahouet 19,200(4) 0.05%
Timothy K. Friar 128,458(5) 0.34%
Sakie Fukushima 115,076(6) 0.30%
Patti S. Hart 0 0.00%
Scott E. Kingdom 107,924(7) 0.28%
Charles D. Miller 32,000(8) 0.08%
Gerhard Schulmeyer 2,000(4) 0.01%
Mark C. Thompson 0 0.00%
Elizabeth S.C.S. Murray 109,124 0.29%
Gary C. Hourihan 56,113(9) 0.15%
Michael D. Bekins 213,778(10) 0.56%
All directors and
executive officers as a
group (15 persons) 2,840,643(11) 7.65%
</TABLE>
NOTES TO STOCK OWNERSHIP TABLE:
(1) Holding includes 658,184 shares of common stock held by the trustees of
the Korn/Ferry Employee Tax Deferred Savings Plan (401(k) Plan) for the
benefit of the listed individual.
(2) Holding includes 215,015 shares of common stock held by the trustees of
the 401(k) Plan for the benefit of the listed individual and right to
acquire beneficial ownership of 109,717 shares of common stock within 60
days through the exercise of option granted under the Performance Award
Plan.
(3) Holding includes 19,985 shares of common stock held by the trustees of
the 401(k) Plan for the benefit of the listed individual and right to
acquire beneficial ownership of 6,834 shares of common stock within
60 days through the exercise of option granted under the Performance
Award Plan.
(4) Holding includes right to acquire beneficial ownership of 2,000 shares of
common stock within 60 days through the exercise of option granted under
the Performance Award Plan.
17
<PAGE>
(5) Holding includes right to acquire beneficial ownership of 16,334 shares
of common stock within 60 days through the exercise of option granted
under the Performance Award Plan.
(6) Holding includes right to acquire beneficial ownership of 15,084 shares
of common stock within 60 days through the exercise of option granted
under the Performance Award Plan.
(7) Holding includes right to acquire beneficial ownership of 15,000 shares
of common stock within 60 days through the exercise of option granted
under the Performance Award Plan.
(8) Holding includes 30,000 shares of common stock held by the Miller Family
Trust dated September 8, 1988 and right to acquire beneficial ownership
of 2,000 shares of common stock within 60 days through the exercise of
option granted under the Performance Award Plan.
(9) Holding includes right to acquire beneficial ownership of 4,501 shares of
common stock within 60 days through the exercise of option granted under
the Performance Award Plan.
(10) Holding includes 3,763 shares of common stock held by the trustees of the
401(k) Plan for the benefit of the listed individual and right to acquire
beneficial ownership of 10,167 shares of common stock within 60 days
through the exercise of option granted under the Performance Award Plan.
(11) Total holding as a group includes 896,947 shares of common stock held by
the trustees of the 401(k), 30,000 shares of common stock held by the
Miller Family Trust dated September 8, 1988, and right to acquire
beneficial ownership of a total of 185,637 shares of common stock within
60 days through the exercise of options granted under the Performance
Award Plan.
(12) Other than with respect to the shares held under the 401(k) plan and the
options under the Performance Award Plan, each person has sole voting and
dispositive power with respect to the shares shown unless otherwise
indicated.
CERTAIN RELATIONSHIPS AND TRANSACTIONS WITH RELATED PARTIES
In November 1999, our Chairman, Richard Ferry, exercised his option to
purchase from us five insurance policies we were carrying to insure his life.
The total purchase price paid to us by Mr. Ferry to purchase the policies was
$1,415,436. This purchase price equaled the total cumulative premiums we had
previously paid. The option was granted to Mr. Ferry pursuant to a Stock
Purchase Agreement, as amended, dated June 2, 1995, by and among Mr. Ferry, us
and various third parties. Under the original terms of the Stock Purchase
Agreement, we agreed to purchase all the shares of our stock then owned by Mr.
Ferry in the event of his death. The purchase of the stock would have been
funded by the proceeds we received from the life insurance policies. Our
recent public offering obviated the need for the stock repurchase and an
amendment, dated April 25, 1999, to the Stock Purchase Agreement was entered
into to eliminate our obligation to purchase Mr. Ferry's stock and removed
certain conditions under which the option could be exercised.
18
<PAGE>
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION & PERSONNEL COMMITTEE
COMMITTEE COMPOSITION AND ROLE
The Compensation Committee is comprised entirely of directors who have
never served as our officers. The Committee (a) approves and oversees our
compensation programs, including incentive and stock option programs, provided
to members of our senior management group, including all named executive
officers, and (b) approves or recommends to our board, as required, specific
compensation actions, including salary adjustments, annual cash bonuses, stock
option grants, and employment contracts for our Chief Executive Officer and
other members of our senior officer group. The Committee met three times
during fiscal 2000.
EXECUTIVE COMPENSATION PHILOSOPHY
In establishing and assessing the compensation programs and compensation
policies for the executive officers and other senior executives, the Committee
is guided by the following principles:
. The total compensation of our executive officers and other key employees
must be competitive with those of other major executive recruiting firms,
recognizing our size and complexity relative to our peers;
. Individual cash bonuses and stock option awards should be closely tied to
the performance of the company as a whole, as well as the performance of
the senior management team both as a group and as individual
contributors; and
. The interests of senior management and our stockholders should be closely
aligned through direct management ownership of our common stock, and by
providing a meaningful portion of each key employee's total compensation
in the form of stock options.
Because a number of our peer organizations are privately-held, precise
information regarding the senior executive compensation practices among our
competitor group is difficult to obtain. In addition, even when such data are
available, meaningful differences in size, complexity, and organizational
structure among our competitor group make direct comparisons of compensation
practices problematic. In assessing the competitiveness of our senior
executive compensation, the Committee relies on information obtained from the
proxies of publicly-traded competitors, information derived from data obtained
from executives and senior search consultants we recruited from competitor
organizations, and the Committee's general knowledge of the market for senior
management positions. From time to time, the Committee also retains
compensation consultants to assess the competitiveness of our officer
compensation and to make suggestions regarding compensation program design.
SENIOR EXECUTIVE COMPENSATION
The compensation provided to our senior officers, including the named
executive officers, consists of an annual base salary, an annual cash bonus,
and stock options granted at the market price of our common stock as of the
date of grant.
(1) BASE SALARIES
Base salaries for our executive officers, including the Chief Executive
Officer, and selected other key employees, are established annually by the
Committee based on the Committee's understanding of competitive practices
among our major competitors, internal equity considerations, and individual
performance. Effective July 1, 2000, the salaries of our executive officers
were increased as follows: Windle Priem, Chief Executive Officer, from
$600,000 to $640,000 (6.7%), Peter Dunn, from $465,000 to $495,000 (6.5%),
Elizabeth Murray, from $350,000 to $370,000 (5.7%), and Gary Hourihan, from
$340,000 to $360,000 (5.9%). The annual base salary of Richard Ferry,
Chairman, was reduced effective May 1, 2000 to $400,000, while the base salary
of Michael Bekins, Chief Operating Officer, was set at $450,000 upon his
assumption of the role on May 1, 2000.
19
<PAGE>
(2) CASH BONUSES
The maximum aggregate annual cash bonuses paid to our executive officers is
limited by a formula that ties aggregate bonuses to a percentage of our net
income. The actual annual cash bonus of each executive officer, including the
Chief Executive Officer, is determined by the Committee based on its
assessment of the performance of the executive officers both as a group (team
performance) and as individuals during fiscal 2000. Subject to the maximum
aggregate cash bonuses dictated by the above mentioned formula, the maximum
cash bonus available to each executive officer is two times base salary.
For fiscal 2000, the Committee determined that cash bonuses for our
executive officers, including the Chief Executive Officer, should be team-
oriented to recognize the contributions of the executive officers as a group
in guiding the company during its first year of public trading. In determining
the level of cash bonuses for our executive officers, the Committee took into
consideration our record financial performance and strong stock price
performance, the numerous acquisitions closed during the year, and the
successful transition of our reward programs and culture to better reflect its
publicly-traded status. Based on these considerations, the Committee awarded
each executive officer, including the Chief Executive Officer, a cash bonus
equal to 1.8 times base salary. This decision resulted in the following cash
bonuses awarded to our executive officers for fiscal 2000: Windle Priem,
$1,080,000; Richard Ferry, $837,000; Peter Dunn, $837,000; Elizabeth Murray,
$630,000; Gary Hourihan, $612,000.
(3) STOCK OPTIONS
As part of their total compensation package, each of our executive
officers, including the Chief Executive Officer, is eligible to receive an
annual grant of stock options (performance options) with a Black-Scholes value
equal to a percentage of their cash bonus award. The specific percentage
awarded each executive officer is based on the Committee's assessment of
Company, team, and individual performance during fiscal 2000. In recognition
of our record financial performance, successful acquisition program, and
progress in other areas, including the successful cultural transition to a
publicly-traded firm, the Committee granted each executive officer the maximum
number of options for fiscal 2000 performance. This decision resulted in the
following option awards: Windle Priem, 57,325 shares; Peter Dunn, 44,425
shares; Elizabeth Murray, 33,450 shares; Gary Hourihan, 32,475 shares. Richard
Ferry, as in the past, declined the grant of options to preserve the shares
for other employees.
EMPLOYMENT CONTRACTS
Each of our executive officers, except Richard Ferry, is covered by an
employment agreement that provides for a minimum level of salary, cash bonus
potential, and option and benefit eligibility. The agreements also provide for
a defined severance benefit of up to two times base salary plus the average of
the most recent two-year cash bonus in the event of a termination of
employment without "cause" or for "good reason" as such terms are defined in
the agreements. The agreements also provide for the continuation of health and
welfare benefits upon a termination without cause or for good reason. It is
the Committee's belief that such agreements are necessary from a competitive
perspective and also contribute to the stability of the management team.
INTERNAL REVENUE CODE SECTION 162(m)
As one of the factors in the review of compensation matters, the
Compensation Committee considers the anticipated tax treatment to the company.
The deductibility of some types of compensation for executive officers depends
upon the timing of an executive's vesting or exercise of previously granted
rights or on whether such plans qualify as "performance-based" plans under the
provisions of the tax laws. It is the Committee's policy, to the extent that
such policy does not conflict with prudent management practices, to satisfy
the requirements necessary to allow the compensation of its executive officers
to be deductible under Section 162(m) of the Internal Revenue Code, as
amended.
Charles D. Miller (Chair)
Frank V. Cahouet
Gerhard Schulmeyer
20
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
---------------------------------- SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL FISCAL SALARY BONUS COMPENSATION OPTIONS COMPENSATION
POSITION YEAR ($) ($) ($) (#) ($)
<S> <C> <C> <C> <C> <C> <C>
Richard M. Ferry, 2000 465,000 837,000 0 0(13) 26,403(1)
Chair of the Board 1999 551,502 538,000 0 0(13) 13,433(2)
1998 550,000 1,375,000 0 0 11,876(3)
Windle B. Priem, 2000 600,000 1,080,000 0 157,325 20,809(1)
Chief Executive 1999 489,130 606,000 0 103,250 13,433(2)
Officer and President 1998 410,000 1,150,000 0 0 11,876(3)
Peter L. Dunn, 2000 465,000 837,000 0 44,425 17,739(4)
Vice Chair, General 1999 455,232 538,000 0 80,500 13,433(2)
Counsel and Corporate 1998 375,000 937,500 0 0 11,876(3)
Secretary
Elizabeth S.C.S. Murray, 2000 350,000 630,000 0 33,450 9,747(1)
Chief Financial 1999 293,748 347,000 0 65,250 905(1)
Officer, 1998 78,450(5) 125,000 0 0 125,076(6)
Treasurer and Executive
Vice President
Gary C. Hourihan 2000 333,333(12) 612,000 0 32,475 129,273(8)
Executive Vice 1999 82,725(7) 95,000 0 43,500 125,000(9)
President-- 1998 -- -- -- --
Organizational
Development
Michael D. Bekins 2000 300,000 556,475 0 23,325 11,227(1)
Chief Operating Officer 1999 260,000 215,000 0 30,500 23,132(10)
1998 200,000 350,000 0 0 12,542(11)
</TABLE>
NOTES TO SUMMARY COMPENSATION TABLE:
(1) Represents insurance premiums paid by the Company.
(2) Represents contributions of $12,528 to the executive's 401(k) plan and
$905 paid by the Company for insurance premiums.
(3) Represents contributions of $10,961 to the executive's 401(k) plan and
$915 paid by the Company for insurance premiums.
(4) Represents tuition contribution of $2,000 and $15,739 paid by the Company
for insurance premiums.
(5) Represents compensation paid to Ms. Murray from January 12, 1998, when
she joined the Company, through the end of fiscal 1998. Ms. Murray's base
salary for fiscal 1998 was paid at an annual rate of $250,000.
(6) Represents $125,000 paid to Ms. Murray as a signing bonus and $76 paid by
the Company for insurance premiums.
(7) Represents compensation paid to Mr. Hourihan from January 28, 1999, when
he joined the Company, through the end of fiscal 1999. Mr. Hourihan's
base salary for fiscal 1999 was paid at an annual rate of $300,000.
(8) Represents $125,000 paid to Mr. Hourihan as the balance of a signing
bonus and $4,273 paid by the Company for insurance premiums.
21
<PAGE>
(9) Represents $125,000 paid to Mr. Hourihan as the first installment of a
signing bonus.
(10) Represents contributions of $11,304 to Mr. Bekins' 401(k) plan and
$11,828 tax equalization amount paid to Mr. Bekins for relocation to
Asia.
(11) Represents contributions to the executive's 401(k) plan
(12) Represents Mr. Hourihan's base salary from May 1, 1999 to June 30, 1999
at an annual rate of $300,000 and from July 1, 1999 to April 30, 2000 at
an annual rate of $340,000.
(13) Mr. Ferry declined the grants of options to preserve the shares for other
employees.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES
The following table shows information for the named executive officers,
concerning:
(1) exercises of stock options during fiscal 2000; and
(2) the amount and values of unexercised stock options as of April 30,
2000.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED IN-
SHARES UNDERLYING OPTIONS THE-MONEY OPTIONS
ACQUIRED ON VALUE AT FY-END(#) AT FY-END($)(1)
EXERCISE REALIZED ---------------------------------------------------
NAME (#)(2) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C> <C> <C>
Richard M. Ferry 0 0 0 0 0 0
Windle B. Priem 24,700 $455,836 109,717 68,833 $1,399,780 $869,131
Peter L. Dunn 20,000 $307,500 6,834 53,666 $ 89,269 $678,512
Elizabeth S.C.S. Murray 17,334 $266,510 4,417 43,499 $ 57,697 $548,706
Gary C. Hourihan 10,000 $150,000 4,501 28,999 $ 56,919 $363,800
Michael D. Bekins 0 $ 0 10,167 20,333 $ 129,056 $258,100
</TABLE>
NOTES TO OPTION EXERCISE TABLE:
(1) This amount represents solely the difference between the closing price on
April 30, 2000 of $26.50 per share of our common stock and the respective
exercise prices of those unexercised options that had an exercise price
below such market price (i.e., "in-the-money" options). No assumptions or
representations regarding the "value" of such options are made or
intended.
(2) This amount represents the number of securities with respect to which the
options were exercised with no shares acquired.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE
VALUE AT
ASSUMED ANNUAL
RATES OF STOCK ALTERNATIVE
PRICE TO (f) AND
APPRECIATION (g): GRANT
INDIVIDUAL GRANTS FOR OPTION TERM DATE VALUE
-----------------------------------------------------------------------------------------------------
PERCENT OF
NUMBER OF TOTAL
SECURITIES OPTIONS/SARS EXERCISE
UNDERLYING GRANTED TO OF BASE
OPTION/SARS EMPLOYEES IN PRICE GRANT DATE
GRANTED(#) FISCAL YEAR ($/SH) EXPIRATION 5% ($) 10% ($) PRESENT
NAME(A) (b) (c) (d) DATE (e) (f) (g) VALUE $ (h)
<S> <C> <C> <C> <C> <C> <C> <C>
Richard M. Ferry 0
Windle B. Priem 100,000 9.06% 13.6875 09/02/04 284,158 626,766
Peter L. Dunn 0
Elizabeth S.C.S. Murray 0
Gary C. Hourihan 0
Michael D. Bekins 0
</TABLE>
22
<PAGE>
PERFORMANCE GRAPH
The Securities and Exchange Commission requires us to present a chart
comparing the cumulative total stockholder return on its shares with the
cumulative total stockholder return on (1) a broad equity market index and (2)
a published industry index or a company-established peer group. The following
graph compares the monthly percentage change in our cumulative total
stockholder return with the cumulative total return of the companies in the
Standard & Poor's 500 Stock Index and a peer group constructed by us.
Cumulative total return for each of the periods shown in the Performance Graph
is measured assuming an initial investment of $100 on February 11, 1999, the
date public trading of our common stock began in connection with our initial
public offering, and the reinvestment of any dividends paid by any company in
the Peer Group on the date the dividends were declared.
The peer group is comprised of publicly-traded companies which are engaged
principally or in significant part in professional staffing and consulting.
The returns of each company have been weighted according to their respective
stock market capitalization at the beginning of each measurement period for
purposes of arriving at a Peer Group average. The members of the peer group
are Careerbuilder, Inc. (CBDR), Heidrick & Struggles International, Inc.
(HSII), Headhunter.net (HHNT), Hotjobs.com (HOTJ), Topjobs.net, Plc (TJOB),
and TMP Worldwide, Inc./LAI Worldwide, Inc. (TMPW/LAIX).
The stock price performance depicted in this graph is not necessarily
indicative of future price performance. This graph will not be deemed to be
incorporated by reference by any general statement incorporating this proxy
statement into any filing by us under the Securities Act of 1933 or the
Securities Exchange Act of 1934, except to the extent we specifically
incorporate this information by reference, and shall not otherwise be deemed
soliciting material or deemed filed under those Acts.
PERFORMANCE GRAPH APPEARS HERE
<TABLE>
<CAPTION>
Measurement Period S&P *COMPARABLE
(Fiscal Year Covered) KFI 500 INDEX INDEX
--------------------- ------ --------- -----------
<S> <C> <C> <C>
Measurement Pt- 11-Feb-99 $100 $100 $100
30-Apr-99 $ 85.2 $106.5 $129.0
30-Jul-99 $108.8 $ 97.4 $106.0
29-Oct-99 $158.9 $108.7 $134.4
31-Jan-00 $247.9 $111.2 $269.0
28-Apr-00 $195.0 $115.8 $260.6
31-Jul-00 $ 52.2 $114.1 $319.9
</TABLE>
* COMPARABLE INDEX = CAREERBUILDER, INC. (CBDR), HEIDRICK & STRUGGLES
INTERNATIONAL, INC. (HSII), HEADHUNTER.NET (HHNT), HOTJOBS.COM (HOTJ),
TOPJOBS.NET, PLC (TJOB), & TMP WORLDWIDE, INC./LAI WORLDWIDE, INC.
(TMPW/LAIX)
23
<PAGE>
OTHER MATTERS
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
We believe that all SEC filings of our officers, directors and ten percent
stockholders complied with the requirements of Section 16 of the Exchange Act
during fiscal 2000, based on a review of forms filed.
ANNUAL REPORT TO STOCKHOLDERS
Enclosed with this proxy statement is our Annual Report for fiscal 2000,
which includes the Company's Annual Report on Form 10-K (excluding the
exhibits thereto). The Annual Report is enclosed for the convenience of
stockholders and should not be viewed as part of these proxy solicitation
materials. If any person who was a beneficial owner of our common stock on
August 2, 2000 for the annual meeting desires additional information, a
complete copy of our Annual Report on Form 10-K, including the exhibits
thereto, will be furnished upon written request. The request should identify
the requesting person as a stockholder as of August 2, 2000 and should be
directed to Peter L. Dunn, Esq., Vice Chair, General Counsel and Corporate
Secretary, Korn/Ferry International, 1800 Century Park East, Suite 900,
California 90067. Our Annual Report on Form 10-K, including the exhibits
thereto, is also available through the SEC's web site at http://www.sec.gov.
SUBMISSION OF STOCKHOLDER PROPOSALS FOR CONSIDERATION AND NOMINATIONS OF
PERSONS FOR ELECTION AS DIRECTORS AT THE ANNUAL MEETING
In order for business to be brought before the annual meeting by a
stockholder, the stockholder must give notice of such business in writing to
Peter L. Dunn, Esq., Vice Chair, General Counsel and Corporate Secretary,
Korn/Ferry International, 1800 Century Park East, Suite 900, California 90067
by the tenth day after such stockholder first received notice of the date of
the annual meeting.
With respect to stockholder proposals, such notice must set forth as to
each matter the stockholder proposes to bring before the meeting:
. a brief description of the business desired to be brought before the
annual meeting and the reasons for conducting such business at the annual
meeting,
. the name and address, as they appear on the corporation's books, of the
stockholder proposing such business,
. the number of shares of the corporation beneficially owned by the
stockholder,
. any material interest of the stockholder in such business, and
. any other information that is required to be provided by the stockholder,
in his or her capacity as a proponent of a stockholder proposal, pursuant
to Regulation 14A under the Exchange Act.
A stockholder's notice of nomination of a person for election as director
must set forth:
. the name and address of the stockholder who intends to make the
nomination and the address of the person or persons to be nominated,
. a representation that such stockholder is a holder of record of stock of
the corporation entitled to vote at such meeting and intends to appear in
person or by proxy at the meeting to nominate the person or persons
specified in the notice,
. a description of all arrangements or understandings between such
stockholder and each nominee and any other person or persons (naming such
person or persons) pursuant to which the nomination or nominations are to
be made by such stockholder,
. such other information regarding each nominee proposed by such
stockholder as would have been required to be included in a proxy
statement filed pursuant to the proxy rules of the SEC had each nominee
been nominated, or intended to be nominated by the board of directors,
and
. the consent of each nominee to serve as a director of the corporation if
so elected.
24
<PAGE>
STOCKHOLDER PROPOSALS FOR NEXT YEAR'S ANNUAL MEETING
Notice of any stockholder proposal or nomination of a person for election
as director that is intended by a stockholder to be included in our proxy
statement relating to our 2001 Annual Meeting of Stockholders must be received
by Peter L. Dunn, Esq., Vice Chair, General Counsel and Corporate Secretary,
Korn/Ferry International, 1800 Century Park East, Suite 900, California 90067
by April 23, 2001.
Each notice of any stockholder proposal must comply with the Securities
Exchange Act of 1934, the rules and regulations thereunder, and our Bylaws as
in effect at the time of such notice.
By Order of the Board of Directors,
/s/ Peter L. Dunn
Peter L. Dunn
Vice Chair, General Counsel and
Corporate Secretary
August 21, 2000
25
<PAGE>
YOUR VOTE IS IMPORTANT
PLEASE SIGN, DATE AND RETURN
YOUR PROXY CARD
IN THE ENVELOPE PROVIDED
AS SOON AS POSSIBLE
26
<PAGE>
[LOGO OF KORN/FERRY INTERNATIONAL]
PROXY
The undersigned hereby acknowledges receipt of the accompanying Notice of
Annual Meeting of Stockholders, dated August 21, 2000, and the related Proxy
Statement and hereby appoints Peter L. Dunn and Elizabeth S.C.S. Murray and
each of them the attorney(s), agent(s) and proxy of the undersigned, with full
power of substitution to vote all stock of Korn/Ferry International which the
undersigned is entitled to vote, for the following matter in the manner
designated below and to vote in their discretion with respect to such other
matters (including matters incident to the conduct of the meeting) as may
properly come before the meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE "FOR" THE PROPOSALS.
------------------------------------------------------
COMMENTS/ADDRESS CHANGE: PLEASE MARK COMMENT/ADDRESS |
BOX ON REVERSE SIDE | (Continued and to be
| signed on other side)
|
|
|
<PAGE>
<TABLE>
<S> <C> <C>
----------------------------------------------------------------------------------------------------------------------------------
Please mark
your votes as -----
indicated in | X |
this example -----
FOR all nominees WITHHOLD AUTHORITY
listed at left to vote for
(except as marked all nominees
1. To elect Patti S. Hart, Windle B. Priem and Mark C. Thompson as Directors for Class 2003. to the contrary) listed at left
----- -----
(To withhold authority to vote for any individual nominee, strike through his/her name listed | | | |
above and initial such strike through.) ----- -----
FOR AGAINST ABSTAIN
2. To amend the Korn/Ferry International Performance Award Plan to increase the number of shares ----- ----- -----
which may be issued thereunder and to approve the limits on the maximum number of awards that | | | | | |
may be granted to individuals as currently set forth in the Plan. ----- ----- -----
----- ----- -----
3. To ratify the retention of Arthur Andersen LLP as our independent auditors for Fiscal 2001. | | | | | |
----- ----- -----
MARK HERE FOR COMMENT/ADDRESS -----
CHANGE AND NOTE ON REVERSE SIDE | |
-----
IMPORTANT PLEASE SIGN, DATE AND RETURN
THIS PROXY PROMPTLY IN THE ENCLOSED
--------- ENVELOPE, WHICH REQUIRES NO POSTAGE IF
| MAILED IN THE UNITED STATES.
|
Signature ____________________________________________________________________ Date ________________________________
NOTE: [Please sign EXACTLY as name appears on this card. Joint Owners should each sign. Attorneys-in-fact, executors,
administrators, trustees, guardians or corporation officers should give FULL title. This proxy shall be valid and may be voted
regardless of the form of signature, however.)
------------------------------------------------------------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
</TABLE>
