M CORP
110 Second Street South
Great Falls, Montana 59405
(406) 727-2600
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 9, 1997
To the Shareholders of M Corp:
The annual meeting of Shareholders of M Corp will be held at the
offices of the Company, 110 Second Street South, Great Falls,
Montana, on Tuesday, December 9, 1997, at 8:00 a.m., for the
following purposes:
1. To elect three directors to hold office until the next
annual meeting of shareholders or until their successors are
duly elected and qualified.
2. To consider and vote upon a proposal to authorize the Board
of Directors of the Company to select an Independent
Certified Public Accounting firm to audit the Company's
financial statements for 1997.
3. To consider and vote upon a proposal to authorize the Board
of Directors to grant to each shareholder of record of the
Company, and only each shareholder of record of the Company,
the nontransferable right to purchase one additional share
of the Company's common stock for each two shares of the
Company's common stock held by the shareholder of record at
the purchase price of Two Dollars ($2.00) per share cash,
all as more fully set forth in the accompanying proxy
statement under the caption "Proposal To Authorize The Board
of Directors to Grant Stock Purchase Rights To
Shareholders".
4. To transact such other business as may properly come before
the meeting or any adjournment of the meeting.
The Company has fixed the close of business on October 31, 1997,
as the record date for the determination of shareholders entitled
to notice of and to vote at the meeting or adjournments thereof,
and only shareholders of record at such time will be entitled to
voting rights.
M CORP
Kathleen King,
Assistant Secretary-Treasurer
Great Falls, Montana
November 26, 1997
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M CORP
110 Second Street South
Great Falls, Montana 59405
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
DECEMBER 9, 1997
Approximate date proxy material sent to shareholders: November 26, 1997.
SOLICITATION AND REVOCATION OF PROXY
This proxy statement is furnished in connection with the
solicitation of proxies by and on behalf of the Board of Directors of M
Corp (the "Company") for its use at the annual meeting of shareholders to
be held on Tuesday, December 9, 1997, at 8:00 a.m., at 110 Second Street
South, Great Falls, Montana.
Any shareholder signing and returning a proxy in the form enclosed
with this statement may revoke such proxy at any time before it is voted
at the meeting by giving written notice of such revocation to the
Secretary of the Company (which notice shall be given by the filing of a
duly executed proxy bearing a later date) or by attending the meeting and
voting in person.
Shareholders will be entitled to cast one vote for each share of
common stock held by them of record at the close of business on the
record date on any matter that may be presented at the meeting for
consideration and action by the shareholders, except that shareholders
will have cumulative voting rights with respect to the election of
directors. Cumulative voting entitles each shareholder to cast for one
nominee a total number of votes equal to the number of shares the
shareholder held of record at the close of business on the record date
multiplied by the number of directors to be elected, or to distribute
that total number of votes among as many nominees as the shareholder
chooses. Directors are elected by a plurality of the votes cast at a
meeting at which a majority of the shares entitled to vote are present in
person or by proxy. Where proxies are marked "withhold authority", these
shares are included in the determination of the number of shares present
and voting. Broker non-votes are not counted in the determination of the
number of shares present and voting. You may withhold your vote from any
nominee(s) for Director by striking a line through the nominee's name(s)
on the proxy form. If you return a signed proxy form that does not
indicate your voting preferences, your shares will be voted for the
election of the nominated Directors and for the proposal giving the Board
of Directors the authority, in its sole discretion, to grant to each
shareholder of record the right to purchase one additional share of the
Company's $1.00 par value Common Stock for each two shares of the
Company's $1.00 par value Common Stock held by the shareholder of record
at the purchase price of Two Dollars ($2.00) per share cash (as explained
further beginning on page 5 of this proxy statement).
The record date for the determination of shareholders entitled to
voting rights at the meeting is the close of business on October 1, 1997.
The annual report to shareholders for the year ended December 31, 1996
has previously been mailed to shareholders.
Expenses in connection with this proxy statement including postage,
printing and handling, will be paid by the Company. Solicitation may be
made of some stockholders by certain directors, officers and employees of
the Company in person or by telephone or telegraph. Employees, directors
and officers of the Company who may participate in the solicitation of
proxies will be reimbursed for out-of-pocket expenses and may receive
remuneration for time spent. The Company expects that the amount of
remuneration, if any, to be paid to those who solicit proxies will not
exceed the total sum of $2,000.00.
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VOTING SECURITIES, OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of the close of business on October 31, 1997, 867,358 shares of
Common Stock, $1.00 par value, were outstanding and are entitled to vote
at this meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Set forth below is certain information concerning persons who are
known by the Company to own beneficially more than 5% of the Company's
voting shares on October 31, 1997:
Amount and
Nature of
Name and Address of Beneficial Percent
Title of Class Beneficial Owner Ownership of Class
$1 Par Value GNI, Inc. 700,341 64.9%
Common Stock 110 Second Street South
Great Falls, Montana
$1 Par Value FDC, Inc. 56,712 5.3%
Common Stock 110 Second Street South
Great Falls, Montana
$1 Par Value Anne Marie and Paul J. 969,573 (1) 89.9%
Common Stock McCann Family Members
110 Second Street South
Great Falls, Montana
(1) Includes the 700,341 shares owned by GNI, Inc., of which firm members
of the Anne Marie and Paul J. McCann family own directly or indirectly
over 50% of the outstanding stock, 56,712 shares owned by FDC, Inc., of
which firm members of the Anne Marie and Paul J. McCann family own
directly or indirectly over 50% of the outstanding stock, 1,520 shares
directly owned by members of the Anne Marie and Paul J. McCann family and
options to acquire 211,000 shares of the Company's unissued shares. Anne
Marie and Paul J. McCann each disclaim beneficial interest in any shares
of stock not owned of record directly by either of them. Neither Anne
Marie nor Paul J. McCann personally own any shares of stock in the
Company.
SECURITY OWNERSHIP OF MANAGEMENT
The table on the following page sets forth as of October 31, 1997,
information concerning the beneficial ownership of the Company's common
stock by each director, nominee for director and each executive officer
named in the Company's Summary Compensation Table and by all directors
and executive officers of the Company as a group. Except as otherwise
noted, each beneficial owner listed has sole investment and voting power
with respect to the common stock indicated.
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Name of Individual or Amount and Nature Percent
Number of Persons In Group of Beneficial Ownership of Class
R. Bruce Robson 10 --
G. Robert Crotty, Jr. -- --
S. M. McCann 36,400(1) 3.4%
All Directors and Executive
Officers as a Group (3 Persons) 36,410(1) 3.4%
(1) S. M. McCann is the record owner of 400 shares of the Company's
common stock and holds an option to acquire 36,000 shares of the
Company's unissued shares. S. M. McCann is a daughter of Anne Marie and
Paul J. McCann. See note (1) under Security Ownership of Certain
Beneficial Owners on page 2.
Based solely on its review of reports of persons subject to Section
16(a) of the Securities and Exchange Act, the Company believes that
required reports were filed in a timely manner disclosing transactions
involving the Company's common stock.
CHANGES IN CONTROL
The Company knows of no contractual arrangements which may at a
subsequent date result in a change in control of the Company.
INFORMATION WITH RESPECT TO NOMINEES FOR DIRECTORS
Three present directors of the Company are management's nominees
for election as directors of the Company to constitute the entire Board
of Directors to hold office until the next annual meeting of
shareholders or until their successors are duly elected and qualified.
It is the intention of the persons named in the accompanying proxy
to vote for the election of the nominees named below unless directed
otherwise. It is expected that if these nominees should decline or be
unable to serve, the proxy will be voted to fill any vacancies so
arising in accordance with the discretionary authority of the persons
named in the proxy.
Unless otherwise indicated all of the nominees for directors have
occupied their present position for more than five years. The following
sets forth certain information concerning the nominees.
R. Bruce Robson, 56, is the Data Processing Manager of Sletten
Construction, Co., Great Falls, Montana. Mr. Robson is also the
secretary-treasurer and a director of Medical Information
Processing Systems, Inc. and a director of TSI, Inc., a subsidiary
of the Company.
G. Robert Crotty, Jr., 70, is an attorney at law and a partner in
the law firm of Graybill, Ostrem & Crotty in Great Falls, Montana.
Mr. Crotty is a director of TSI, Inc.
S. M. McCann, 34, President and Director of M Corp, is an attorney
at law and an investor. S. M. McCann is a director of GNI, Inc.,
UAC, Inc. and Diversified Realty, Inc. S. M. McCann is a daughter
of Anne Marie and Paul J. McCann.
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The Company has only one committee, the executive committee. The
Board of Directors has not appointed an audit committee, compensation
committee or a nominating committee.
The executive committee consists of R. Bruce Robson and G. Robert
Crotty, Jr., each of whom are directors. The executive committee meets
on call and has authority to act on most matters during the intervals
between Board meetings.
The Board of Directors has the responsibility for establishing
broad corporate policies and for the overall performance of the Company.
Members of the Board are kept informed of the Company's business by
reports and documents sent to them as well as by operating and financial
reports submitted to them at Board meetings.
Meetings of the Board of Directors are held as needed, and there is
also an organizational meeting following the conclusion of the
shareholders meeting. The Board held two meetings in 1996 at which all
directors participated.
REMUNERATION OF DIRECTORS AND OFFICERS
The Company has not adopted a formal plan for the compensation of
directors. During 1996 the Company and its consolidated subsidiaries
paid a total of $200 to directors of the Company and the Company's
consolidated subsidiaries.
EXECUTIVE COMPENSATION
Summary Compensation Table. The following table lists the cash
compensation paid by the Company and the Company's consolidated
subsidiaries to the Company's President for 1996, 1995 and 1994. No
officer or director of the Company or the Company's consolidated
subsidiaries received total cash compensation in excess of $100,000 for
1996, 1995 or 1994.
Name of Individual Calendar Total Cash
and Position Year Compensation
S. M. McCann 1996 $ 0
President, Director 1995 0
1994 250
The Company does not have any compensatory stock appreciation
rights plans or compensatory stock option plans. During 1996, the
Company's Board of Directors granted S. M. McCann the option to purchase
36,000 shares of the Company's unissued common stock at the exercise
price of five dollars per share. Also during 1996, the Company's Board
of Directors granted Paul J. McCann the option to purchase 175,000
shares of the Company's unissued common stock at the exercise price of
five dollars per share. The options are classified as non-statutory
stock options. The options expire on September 1, 2003.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
An independent certified public accounting firm has not yet been
selected to audit the Company's financial statements for 1997. To allow
the Board of Directors flexibility, the Board of Directors requests
shareholder approval authorizing the Board of Directors to select an
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independent certified public accounting firm to audit the Company's
financial statements for 1997.
The Board of Directors can select an independent accounting firm
without shareholder approval, however, the Board has requested
shareholder approval as a matter of courtesy to shareholders. In the
event of a negative vote by the shareholders on the matter, the Board
will select an independent accounting firm to audit the Company's
financial statements for 1997 and may subsequently request ratification
of the selection by the shareholders.
Dwyer & Keith, CPAs, P.C., served as the Company's independent
auditors for 1996. A representative of Dwyer & Keith, CPAs, P.C. is not
expected to attend the shareholders meeting. If a representative of Dwyer
& Keith, CPAs, P.C. is at the meeting, he will be welcome to make
whatever statement he desires on behalf of his firm and he will be
available to respond to appropriate questions addressed to him. No
substantial services other than auditing have been provided by Dwyer &
Keith, CPAs, P.C., or any other public accountant.
The firm of Dwyer & Keith, CPAs, P.C. has not resigned or declined
to stand for re-election nor has that firm been dismissed by the Board of
Directors as the Company's independent certified public accountants.
There have been no material disagreements between the Company and Dwyer &
Keith, CPAs, P.C. on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure. The
reports of Dwyer & Keith, CPAs, P.C. on the Company's financial
statements for the past two years have been unqualified.
PROPOSAL TO AUTHORIZE THE BOARD OF DIRECTORS TO GRANT STOCK PURCHASE
RIGHTS TO SHAREHOLDERS
The Board of Directors is submitting to the shareholders for the
shareholders to vote on authorizing the Board of Directors to grant to
each shareholder of record of the Company the right to purchase one
additional share of the Company's $1.00 Par Value Common Stock for each
two shares of the Company's $1.00 par value Common Stock owned of record
by the shareholder at the purchase price of $2.00 per share cash.
If the proposal is approved and if the Board of Directors thereafter
decides to grant to each shareholder of record the right to purchase one
additional share for each two shares held of record by the shareholder,
the Board of Directors intends to allow each shareholder of record the
right to exercise all or a portion of his or her right to purchase
subject to a minimum of ten dollars ($10.00) per order. The Company will
not accept any orders for more shares than the shareholder's right to
purchase nor will the Company accept orders for, or issue, any fractional
shares.
If the proposal is approved by the Company's shareholders and if the
Board of Directors authorizes the grant of such rights to the Company's
shareholders and additional shares of the Company's common stock are
subsequently issued, the Company intends to use the net proceeds from the
sale of the Common Stock to fund the Company's operations.
The Company currently does not have any revenue generating
activities other than management and accounting services that the Company
may provide to its subsidiaries from time to time. The Company currently
depends substantially upon cash dividends from its subsidiaries for the
funding of its cash requirements. Dividends paid by First Montana Title
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Insurance Company ("FMTIC"), the Company's lower tier subsidiary, are
restricted by statutes of the State of Montana. FMTIC is required to
obtain regulatory approval before making any dividend distributions. At
December 31, 1996, substantially all of the Company's consolidated
retained earnings were subject to such restrictions. At December 31,
1996, on an unconsolidated basis, M Corp had an accumulated deficit of
$8,016,088.
Following are condensed, unaudited and unconsolidated balance sheets
of M Corp, as of September 30, 1997 and December 31, 1996. The condensed,
unaudited and unconsolidated balance sheets of M Corp should be read in
conjunction with the audited consolidated financial statements and notes
thereto of M Corp contained in the Company's Annual Report to
shareholders for the year ended December 31, 1996, which has previously
been mailed to shareholders.
September 30, December 31,
1997 1996
Assets
Cash $ 22,268 $ 143,473
Investments in Subsidiaries, at Cost 2,759,597 2,122,892
Other 127,380 387,418
Total Assets $ 2,909,245 $ 2,653,783
Liabilities and Stockholders' Equity
Accounts Payable and
Accrued Liabilities $ 256,137 $ 50,649
Common Stock and Paid-In-Capital 12,985,566 12,985,566
Accumulated Deficit (7,966,114) (8,016,088)
Treasury Stock (2,366,344) (2,366,344)
Total Liabilities and
Stockholders' Equity $ 2,909,245 $ 2,653,783
The Company is authorized to issue 5,000,000 shares of $1.00 par
value common stock. As of October 31, 1997, there were 3,051,004 shares
issued of which 867,358 shares are outstanding. As of October 31, 1997,
the Company had issued outstanding options to purchase 211,000 shares of
the Company's previously unissued common stock at the exercise price of
$5.00 per share exercisable at any time on or before September 1, 2003.
The Company has no other securities issued or outstanding.
Each share of common stock is entitled to one vote on each matter
submitted to the shareholders with cumulative voting rights in the
election of directors. The shares of common stock are fully paid and non-
assessable and do not have preemptive rights. In the event of
liquidation, dissolution or winding up of the Company, the holders of
common stock are entitled to share ratably in all assets remaining after
payment of liabilities. The holders of common stock are entitled to
receive ratably such dividends, if any, as may be declared from time to
time by the Board of Directors out of funds legally available therefor. A
limited amount of dividends have been declared and paid by the Company in
the past and there are no assurances that the Company will declare and
pay any dividends in the future.
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The Company's common stock is not traded on any securities exchange.
To the Company's knowledge, neither bid nor asked quotations for the
Company's common stock have appeared in any established quotation system
during the past several years, nor are such quotations reported in any
newspapers, nor are records kept of any quotations by the National
Quotation Bureau, Inc. No public market exists for the Company's common
stock and the Company believes that neither the approval of the proposal
nor the issuance of shares offered pursuant thereto will, in and of
themselves, result in a public market for the Company's common stock.
The Board of Directors could have granted the right to purchase the
Company's common stock to each existing shareholder without the specific
authority of the Company's shareholders. However, the Board of Directors
has requested shareholder approval as a matter of courtesy to the
Company's shareholders. Approval of the proposal will require a favorable
vote of a majority of the outstanding shares.
Members of the Anne Marie and Paul J. McCann family have advised the
Board of Directors that all outstanding shares owned or controlled by
them directly or indirectly will be voted in the same manner as a
majority of the shares of unaffiliated shareholders (shareholders other
than GNI, Inc., FDC, Inc. and members of the Anne Marie and Paul J.
McCann family) are voted with respect to the proposal. Therefore,
shareholders other than the Anne Marie and Paul J. McCann family will
determine if the proposal is approved or not. It is important that
shareholders other than members of the Anne Marie and Paul J. McCann
family vote on the proposal as their vote will determine whether the
proposal is adopted or not.
STOCKHOLDER PROPOSALS FOR THE 1998 ANNUAL MEETING
It is anticipated that the 1998 Annual Meeting of shareholders will
be held in July, 1998. Stockholder proposals intended for presentation at
the meeting must be received by the Company for inclusion in its proxy
statement and form of proxy relating to the meeting no later than April
15, 1998.
OTHER INFORMATION
Each share of Common Stock is entitled to one vote on each matter
submitted to the shareholders with cumulative voting rights in the
election of directors. The shares of Common Stock are fully paid and non-
assessable and do not have preemptive rights. In the event of
liquidation, dissolution or winding up of the Company, the holders of
Common Stock are entitled to share ratably in all assets remaining after
payment of liabilities. The Company does not have any plans to liquidate
the Company or to sell a material amount of assets of the Company or to
make any changes in management of the Company or in the Board of
Directors. Management of the Company is presently considering whether to
implement a corporate reorganization whereby the Company would be merged
with and into a future parent company. Montana Business Corporation Law
provides for appraisal rights for shareholders to obtain fair value for
their shares in the event of such a likely reorganization. The holders of
Common Stock are entitled to receive ratably such dividends, if any, as
may be declared from time to time by the Board of Directors out of funds
legally available therefor. A limited amount of dividends have been
declared and paid by the Company in the past and there is no assurance as
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to what the Board of Directors may do pertaining to the declaration of
dividends in the future.
Additional information concerning the Company is set forth in the
Company's Annual Report on Form 10-KSB for the year ended December 31,
1996. The Company's Annual Report on Form 10-KSB will be mailed to
shareholders, without charge, upon the written request of the shareholder.
Requests should be mailed to Secretary, M Corp, P. O. Box 2249, Great
Falls, Montana 59403.
MANNER IN WHICH PROXIES WILL BE VOTED
All properly executed proxies received by management will be voted.
In the absence of contrary direction, management proposes to vote the
proxies for the election of each of the above nominees to the Board, each
to hold office until the next annual meeting of shareholders or until his
successor is duly elected and qualified, to vote the proxies for the
proposal authorizing the Board of Directors to select an independent
certified public accounting firm to audit the Company's financial
statements for 1997 and to vote the proxies for the proposal authorizing
the Board of Directors to grant to each shareholder of record, and only
each shareholder of record, the nontransferable right to purchase one
additional share of the Company's common stock for each two shares of the
Company's common stock held by the shareholder of record at the purchase
price of Two Dollars ($2.00) per share cash.
Management knows of no other business to be presented for action at
the meeting other than the matters stated above. If any other matter
should properly come before the meeting, it is intended that the proxy
agents named in the proxy will vote thereon in accordance with their best
judgment.
Whether or not you expect to be present at the meeting, you are urged
to execute and return the enclosed form of proxy. You can always vote in
person if you attend the meeting.
M Corp
Kathleen King,
Assistant Secretary-Treasurer
November 26, 1997
Great Falls, Montana
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PROXY
THIS PROXY SOLICITED BY THE BOARD OF DIRECTORS
M CORP
The undersigned hereby appoints K. King, G. Robert Crotty, Jr. and
R. Bruce Robson and each of them, with full power of substitution, to
represent the undersigned and to vote all stock registered in the name of
the undersigned at the annual meeting of shareholders of M Corp to be
held at 110 Second Street South, Great Falls, Montana, on Tuesday,
December 9, 1997, at 8:00 a.m., and at any adjournments thereof, on the
proposals listed below and as more particularly described in the
Company's proxy statement and in their discretion upon such other matters
as may properly come before the meeting. The Board of Directors
recommends a vote for the following proposals:
1. Election of the three directors listed below as proposed in the
accompanying proxy statement.
FOR all nominees listed below WITHHOLD AUTHORITY to
(except as marked_to the vote for all_nominees listed
contrary below) |_| below |_|
Instruction: To withhold authority to vote for any individual nominee
strike a line through the nominee's name in the list below.
G. Robert Crotty, Jr., Sheila M. McCann, R. Bruce Robson
2. Authorize the Board of Directors to select an Independent Certified
Public Accounting firm to audit the Company's financial statements for
1997.
_ _ _
FOR |_| AGAINST |_| ABSTAIN |_|
3. Authorize the Board of Directors to grant to each shareholder of
record of the Company, and only each shareholder of record of the
Company, the nontransferable right to purchase one additional share of
the Company's common stock for each two shares of the Company's common
stock held by the shareholder of record at the purchase price of Two
Dollars ($2.00) per share cash, all as more fully set forth in the
accompanying proxy statement under the caption "Proposal To Authorize The
Board of Directors to Grant Stock Purchase Rights To Shareholders".
_ _ _
FOR |_| AGAINST |_| ABSTAIN |_|
4. To transact such other business as may properly come before the
meeting or any adjournment of the meeting.
The shares represented hereby shall be voted in accordance with any
specification made above. UNLESS OTHERWISE INDICATED, THIS PROXY WILL BE
VOTED FOR ITEMS 1, 2 AND 3 LISTED ABOVE.
__________________, 1997
__________________________________
Signature of Shareholder
