<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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 sec. 240.14a-11(c) or sec. 240.14a-12
TCA CABLE TV, INC.
- --------------------------------------------------------------------------------
(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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
TCA CABLE TV, INC.
February 24, 1997
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of
TCA Cable TV, Inc. scheduled to be held on March 21, 1997, at the Sheraton Tyler
Hotel, 5701 S. Broadway, Tyler, Texas, commencing at 3:30 p.m. Your Board of
Directors and management look forward to personally greeting those shareholders
able to attend.
At the meeting, shareholders are being asked to elect nine directors and to
consider and vote on a proposal to approve the 1996 Non-Employee Directors'
Stock Option Plan. In addition, management will report to the shareholders on
the operations and affairs of the Company.
It is important that your shares are represented at the meeting.
Accordingly please sign, date and return the enclosed proxy card in the envelope
provided for your convenience.
On behalf of the Board of Directors, thank you for your continued support.
Sincerely,
/s/ ROBERT M. ROGERS
ROBERT M. ROGERS
Chairman of the Board
And Chief Executive Officer
<PAGE> 3
TCA CABLE TV, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 21, 1997
Notice is hereby given that the Annual Meeting of Shareholders of TCA Cable
TV, Inc., a Texas corporation (the "Company"), will be held on Friday, March 21,
1997, at 3:30 p.m. at the Sheraton Tyler Hotel, 5701 S. Broadway, Tyler, Texas,
for the following purposes:
(1) To elect nine directors (constituting the entire Board of Directors)
to serve until the next Annual Meeting of Shareholders or until
their respective successors shall be elected and qualified;
(2) To consider and vote upon a proposal to approve the 1996
Non-Employee Directors' Stock Option Plan; and
(3) To transact such other business as may properly come before the
Annual Meeting of Shareholders or any meetings to which such Annual
Meeting may be adjourned.
The accompanying Proxy Statement contains information regarding, and a more
complete description of, the items of business to be considered at the meeting.
The close of business on February 12, 1997, has been fixed as the record
date for determination of shareholders entitled to notice of, and to vote at,
such Annual Meeting of Shareholders and any adjournments thereof, and only
shareholders of record at February 12, 1997, are so entitled.
Please complete, date and sign the enclosed Proxy and return it promptly.
If you attend the meeting, you may vote in person. A reply envelope is provided
for this purpose and needs no additional postage if mailed in the United States.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ KAREN L. GARRETT
KAREN L. GARRETT,
Corporate Secretary
Tyler, Texas
February 24, 1997
<PAGE> 4
TCA CABLE TV, INC.
3015 SSE LOOP 323
TYLER, TEXAS 75701
------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 21, 1997
------------------
This Proxy Statement is being sent to shareholders of TCA Cable TV, Inc.
("TCA" or the "Company") in connection with the solicitation by the Board of
Directors of the Company of proxies for use at the Annual Meeting of
Shareholders of the Company to be held on March 21, 1997, or any meeting(s) to
which such annual meeting may be adjourned (the "Annual Meeting"). The Annual
Meeting will be held for the purposes set forth in the accompanying Notice of
Annual Meeting of Shareholders. Solicitation of proxies may be made in person or
by mail, telephone, or telegraph by directors, officers, and regular employees
of the Company. The Company may also request banking institutions, brokerage
firms, custodians, nominees, and fiduciaries to forward solicitation material to
the beneficial owners of the Company's Common Stock, par value $.10 per share
(the "Common Stock"), held of record by such persons, and the Company will
reimburse their forwarding expenses. The cost of solicitation of proxies will be
paid by the Company. This Proxy Statement was first mailed to shareholders on or
about February 24, 1997.
Any shareholder returning the form of proxy enclosed with this Proxy
Statement has the power to revoke such proxy at any time prior to its use by
written notice of such revocation received by the Company prior to its use. If
notice of revocation is not received prior to such time, a shareholder may
nevertheless revoke a proxy if he attends the Annual Meeting and desires to vote
in person.
All shares represented by valid proxies, unless the shareholder specifies
otherwise, will be voted (i) FOR the election of the nine directors named under
"Election of Directors" as nominees for election as directors of the Company for
terms expiring in 1998; (ii) FOR the approval of the 1996 Non-Employee
Directors' Stock Option Plan; and (iii) at the discretion of the proxy holders
in accordance with their best judgment with regard to any other matter that may
properly come before the Annual Meeting or any adjournment thereof.
VOTING SECURITIES
The voting securities of the Company are shares of its Common Stock, each
share of which entitles the holder thereof to one vote. Only shareholders of
record of the Company at the close of business on February 12, 1997, are
entitled to notice of, and to vote at, the Annual Meeting. At February 12, 1997,
there were approximately 24,816,909 shares of Common Stock outstanding.
QUORUM AND VOTING
The presence at the Annual Meeting, in person or by proxy, of the holders
of a majority of the outstanding shares of Common Stock is necessary to
constitute a quorum. Each share represented at the Annual Meeting in person or
by proxy will be counted toward a quorum. In deciding all questions, a holder of
Common Stock on the Record Date shall be entitled to one vote for each share.
<PAGE> 5
In order to be elected as a director, a nominee must receive the
affirmative vote of the holders of a plurality of the shares of Common Stock
present, in person or by proxy, at the Annual Meeting, provided a quorum is
present. With regard to the election of directors, votes may be cast in favor or
withheld; votes that are withheld will be excluded entirely from the vote and
will have no effect.
The approval of the 1996 Non-Employee Directors' Stock Option Plan requires
the affirmative vote of the holders of a majority of the shares of Common Stock
present, in person or by proxy, at the Annual Meeting, provided a quorum is
present.
BENEFICIAL OWNERSHIP
The following table sets forth as of December 31, 1996, information
regarding the beneficial ownership of the Company's Common Stock by each person
known by the Company to own five percent (5%) or more of the outstanding shares
of Common Stock, each director of the Company, the Company's Named Executive
Officers (as herein defined), and the executive officers and directors of the
Company as a group.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF PERCENT
BENEFICIAL OF
BENEFICIAL OWNER TITLE OF CLASS OWNERSHIP(1) CLASS(2)
---------------- -------------- ------------ --------
<S> <C> <C> <C>
Robert M. Rogers Common Stock 4,945,194(3)(4) 19.9%
3015 SSE Loop 323
Tyler, TX 75701
Louise H. Rogers Common Stock 3,149,501(5) 12.7%
2512 Alta Mira
Tyler, TX 75701
Chieftain Capital Common Stock 2,153,625(6) 8.7%
Management, Inc.
12 East 49th Street
New York, NY 10017
Richard C. Blum & Common Stock 1,469,000(7) 5.9%
Associates, L.P.
909 Montgomery Street,
Suite 400
San Francisco, CA 94133
A. W. Riter, Jr. Common Stock 679,940(8) 2.7%
Ben R. Fisch, M.D. Common Stock 666,180 2.7%
Fred R. Nichols Common Stock 66,518(3)(9) *
Wayne J. McKinney Common Stock 182,080(10) *
James F. Ackerman Common Stock 10,000 *
Kenneth S. Gunter Common Stock 5,500(11) *
Randall K. Rogers Common Stock 129,120(3)(12) *
Fred W. Smith Common Stock 10,000(13) *
Directors and executive
officers as a group
(twelve persons) Common Stock 6,750,397(14) 27.2%
</TABLE>
- ---------------
* Less than 1.0%
(1) "Beneficially" owned shares, as defined by the Securities and Exchange
Commission, are those shares as to which a person has voting or dispositive
power, or both. "Beneficial" ownership does not necessarily
2
<PAGE> 6
mean that the named person is entitled to receive the dividends on, or the
proceeds from the sale of, the shares.
(2) This calculation is the quotient of (a) the number of shares currently
beneficially owned by the named individual or group, plus the number of
shares, if any, for which options held by such person or group are
exercisable within 60 days, divided by (b) the total number of shares
outstanding at December 31, 1996, plus the number of shares, if any, for
which options held by such person or group are exercisable within 60 days.
(3) For each person, includes shares beneficially owned pursuant to currently
exercisable stock options: Robert M. Rogers -- 5,000; Fred R.
Nichols -- 38,750; and Randall K. Rogers -- 500.
(4) Includes 120,000 shares owned by The Rogers Foundation, Inc., a private
charitable foundation of which Mr. Robert M. Rogers is President. Also
includes 50,000 shares owned by Mr. Rogers' spouse and 800,000 shares owned
by Rogers Venture Enterprises, Inc., a corporation wholly owned by Mr.
Robert M. Rogers and Louise H. Rogers.
(5) Does not include 800,000 shares owned by Rogers Venture Enterprises, Inc.,
a corporation owned 50% by Louise H. Rogers and 50% by Robert M. Rogers.
Ms. Rogers disclaims beneficial ownership of such shares. Includes 19,000
shares owned by Ms. Rogers' spouse.
(6) This information is based on a Schedule 13G filed with the Securities and
Exchange Commission reporting that, as of December 31, 1996, Chieftain
Capital Management, Inc., a registered investment adviser ("Chieftain"),
had shared voting and dispositive power with respect to all 2,153,625
shares. Chieftain's clients are the direct owners of the shares shown. No
such client has an interest that relates to more than 5% of the class.
(7) Richard C. Blum & Associates, L.P. serves as the general partner or
investment adviser for entities that own an aggregate of 1,469,000 shares
of the Company's Common Stock.
(8) Includes 42,280 shares owned by various trusts of which Mr. Riter is a
Co-trustee, and 80,000 shares owned by a family partnership of which a
trust controlled by Mr. Riter is the sole general partner.
(9) Includes 350 shares owned by Mr. Nichols' daughter who resides with him.
(10) Includes 60,937 shares owned by various trusts of which Mr. McKinney's
spouse is Trustee.
(11) Shares are owned by a trust for which Mr. Gunter is Trustee.
(12) Includes 59,200 shares owned by The Rogers Family Trust of which Mr.
Randall K. Rogers is Trustee and 500 shares owned by Rogers Children Trust
of which Mr. Randall K. Rogers is Trustee. Mr. Randall K. Rogers is Trustee
for two Texas Uniform Gift Minor Accounts which have 1,000 shares each for
an aggregate of 2,000 shares.
(13) Shares are owned by a trust for which Mr. Smith is a Co-trustee.
(14) Includes 64,500 shares covered by currently exercisable options granted
under the Company's Amended and Restated Incentive Stock Option Plan. See
also note 3.
3
<PAGE> 7
PROPOSAL 1 -- ELECTION OF DIRECTORS
NOMINEES FOR DIRECTORS
Nine directors are to be elected at the Annual Meeting, each director to
hold office for a term of one year or until his successor shall have been
elected and qualified. The shares represented by the proxy will be voted for the
nominees whose names appear therein, but the persons designated as proxies
reserve full discretion to cast votes for other persons in the event that any
such nominees are unable to serve. All of the nominees have indicated that they
are willing to stand for election and are willing to serve if elected.
<TABLE>
<CAPTION>
DIRECTOR
NOMINEE POSITION HELD AGE SINCE
------- ------------- --- --------
<S> <C> <C> <C>
Robert M. Rogers........................... Chairman of the Board of Directors 70 1981
and Chief Executive Officer
Fred R. Nichols............................ President, Chief Operating Officer 50 1981
and Director
Wayne J. McKinney(1)....................... Director 65 1981
Ben R. Fisch, M.D.(2)...................... Director 71 1981
A.W. Riter, Jr.(2)......................... Director 72 1981
James F. Ackerman(2)....................... Director 72 1981
Kenneth S. Gunter(1)....................... Director 63 1984
Randall K. Rogers.......................... Director 37 1989
Fred W. Smith(1)........................... Director 63 1995
</TABLE>
- ---------------
(1) Member of Audit Committee.
(2) Member of Compensation and Stock Option Committee.
Each of the foregoing persons has served in the above capacities since the
inception of the Company in 1981 unless otherwise indicated.
Robert M. Rogers founded the Company and each of its subsidiaries and has
served as Chairman of the Board of Directors and CEO of the Company and each of
the Company's subsidiaries, excluding VPI Communications, Inc., since their
inception. Mr. Rogers was President of the Company from its inception in 1981
until September 1990. Mr. Rogers has been actively involved in the ownership and
operation of cable television systems since 1954. Mr. Rogers is an officer,
director and shareholder of the two systems for which corporations affiliated
with the Company provide general management services. He is a member of the
cable television Pioneers' Club.
Fred R. Nichols is President, Chief Operating Officer and a Director of the
Company. Prior to being named President in September 1990, Mr. Nichols served as
Executive Vice President and a Director of the Company since its inception,
Chief Operating Officer of the Company since December 1983 and Secretary of the
Company from September 1984 to December 1990. He had been Treasurer of the
Company's subsidiaries from 1980 until 1985 when he was named President of TCA
Management Company and all other wholly-owned subsidiaries of the Company,
excluding VPI Communications, Inc. Mr. Nichols is currently on the Executive
Committee of the Board of Directors of the Cable Telecommunications Association
(CATA), a trade association of the cable industry, and of C-SPAN, a cable
television network.
Wayne J. McKinney has been actively engaged in the cable television
business since 1958 and was employed by the Company or its subsidiaries from
1958 until his retirement in January 1986, serving as a Director and Senior Vice
President -- Engineering of the Company from its inception and as Senior Vice
President or Vice President, Chief Engineer and/or Director of Engineering of
the Company's subsidiaries. Mr. McKinney has been a member of the cable
television Pioneers' Club since 1979, and is a Charter and Senior Member of the
Society of Cable Telecommunications Engineers.
4
<PAGE> 8
Ben R. Fisch, M.D., has been a Director of the Company or its subsidiaries
since 1967. Dr. Fisch has been retired from medical practice in Tyler, Texas
since July 1986.
A. W. Riter, Jr. retired as Senior Chairman of the Board of Directors of
NCNB Texas -- Tyler, Texas (successor to First RepublicBank Tyler), on September
30, 1988. He had served as Chairman and Chief Executive Officer until June 30,
1988 and held the same positions with First RepublicBank Tyler and its
predecessor, InterFirst Bank Tyler, from August 1979 to June 1988 and served as
President of Peoples National Bank (predecessor of InterFirst Bank Tyler) from
1964 until 1979. Mr. Riter has served as a Director or officer of the Company or
its subsidiaries since 1965.
James F. Ackerman has been President of Cardinal Ventures, LLC in
Indianapolis, Indiana since July 1993. Cardinal Ventures, LLC is an equity
investor in small businesses. He has been a Director of the Company since 1981.
Mr. Ackerman was President of Jim Ackerman and Associates, Inc., a financial
consulting firm to the cable television industry from October 1984 to December
31, 1994. From 1973 to December 1, 1984, he was Senior Vice President of A.G.
Becker Paribas, Inc. Mr. Ackerman has been engaged in investment banking
activities with respect to the cable television industry since 1959 and served
as a partner of Becker Communications Associates, a cable television investment
partnership, from 1973 to 1989. He was also Chairman and Chief Executive Officer
of Cardinal Communications, Inc., an Indiana cable television operator, a
position he had held from 1971 until the company was sold in 1993. Mr. Ackerman
is a former President and Director of the Indiana Cable Television Association,
a past Director of the National Cable Television Association and a member of the
cable television Pioneers' Club.
Kenneth S. Gunter has been Chairman and CEO of MT Associates, Inc., San
Angelo, Texas, a broadband communications design and construction contractor
since October 1993. He has been a Director of the Company since 1984. He has
served as a senior officer and director of several publicly-held cable
television multiple system operators since 1958, including International
Cablevision Corporation, Columbia Cable Systems, Inc., UA-Columbia Cablevision,
Inc., Rogers-UA Cablesystems, Inc. and United Artists Communications, Inc. He is
a past director of the National Cable Television Association, a Senior Member
and past officer and director of the Society of Cable Telecommunications
Engineers and a member of the cable television Pioneers' Club.
Randall K. Rogers has been with TCA since 1983, previously serving as
general manager in Big Spring and Huntsville, Texas. He was elected to the Board
of Directors in 1989. Since 1989, Mr. Rogers has also served as general manager
of the Company's operations in Bryan/College Station, Texas. In 1996, Mr. Rogers
was named Vice President -- System Operations, overseeing operations in east and
south Texas. Mr. Rogers is the son of Robert M. Rogers.
Fred W. Smith is Chairman of the Donald W. Reynolds Foundation, one of the
thirty largest private charitable foundations in the United States having served
in such capacity since 1990. Mr. Smith's entire business career has been with
the Donrey Media Group, which he joined in 1951. He served in various capacities
until 1993 when he retired as the company's President and Chief Executive
Officer. He has been a TCA Director since 1995.
The Board of Directors held four meetings during fiscal 1996. The Board of
Directors has two standing committees -- the Audit Committee and the
Compensation and Stock Option Committee.
The functions performed by the Audit Committee include: recommending to the
Board of Directors selection of the Company's independent accountants for the
ensuing year; reviewing with the independent accountants and management the
scope and result of the audit; reviewing the independence of the independent
accountants; reviewing actions by management and independent accountants'
recommendations; and meeting with management and the independent auditors to
review the effectiveness of the Company's system of internal control. The Audit
Committee met two times during fiscal 1996.
The Compensation and Stock Option Committee met twice during 1996. The
functions performed by this committee include: reviewing and recommending the
Company's executive salary structure; reviewing the Company's Amended and
Restated Incentive Stock Option Plan (and granting options thereunder);
recommending directors' fees; and approving salary and bonus awards to certain
key employees.
5
<PAGE> 9
The Board of Directors does not have a nominating committee. Functions
customarily attributed to a nominating committee are performed by the Board of
Directors as a whole.
During 1996, each director attended all meetings of the Board of Directors
and respective committees on which he served.
PROPOSAL 2 -- APPROVAL OF
1996 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
GENERAL
Upon review of the Company's existing stock option plan, the Board of
Directors noted that non-employee directors of the Company were not eligible to
receive options. In order to advance the interests of the Company and its
shareholders by providing a means to attract and retain highly qualified persons
to serve as non-employee directors of the Company and to enable such persons to
acquire or increase a proprietary interest in the Company, thereby promoting a
closer identity of interests between such persons and the Company's
shareholders, the Board of Directors unanimously approved the 1996 Non-Employee
Directors' Stock Option Plan (the "Plan").
A copy of the Plan is attached to this Proxy Statement as Appendix A. The
following is a brief summary of certain provisions of the Plan and is qualified
in its entirety by reference to the full text of the Plan.
SUMMARY OF PLAN PROVISIONS
The Plan will be administered by a committee of not fewer than two members
of the Board of Directors who are not non-employee directors (the "Committee").
In addition to the general administration of the Plan, the Committee has the
power, among other things, to determine and interpret each option agreement and
to modify any option agreement or waive any conditions or restrictions
applicable to any option. Each non-employee director will be eligible to
participate in the Plan. The Plan provides that each participant shall
automatically receive an option to purchase 5,000 shares of Common Stock on the
day the Plan becomes effective or at the effective date of the participant's
initial election to the Board of Directors. Additionally, each year an option to
purchase 2,500 shares of Common Stock will be automatically granted to each
participant then serving as a non-employee director at the close of business on
the day of the Company's Annual Meeting of Shareholders. The price per share at
which the Common Stock may be purchased upon exercise of an option will be equal
to 100% of the fair market value of the Common Stock on the date the option is
granted. Each option granted under the Plan becomes immediately exercisable on
the date of its grant and expires on the earlier of ten years after the date the
option was granted or one year after the date the participant to whom the grant
was made ceases to serve as a non-employee director of the Company for any
reason.
The aggregate number of shares of Common Stock for which options under the
Plan may be granted is 250,000, subject to certain capital adjustments. As of
February 7, 1997 six non-employee directors of the Company were eligible to
participate in the Plan. As a group the non-employee directors of the Company
will receive options to purchase an aggregate of 30,000 shares of Common Stock
when the Plan becomes effective. As a group the non-employee directors of the
Company will also receive options to purchase an aggregate of 15,000 shares of
Common Stock if each continues to serve as a non-employee director at the close
of business on the day of the Company's 1998 Annual Meeting of Shareholders. The
last reported sales price of the Common Stock on the Nasdaq on February 7, 1997
was $30.13.
SUMMARY OF CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE PLAN
Options granted under the Plan will be "nonstatutory options," i.e., they
will not qualify as "incentive stock options" under Section 422 of the Internal
Revenue Code of 1986. A Plan participant who receives an option under the Plan
generally will not recognize any taxable income at the time the option is
granted, and the Company will not be entitled to an income tax deduction with
respect to the option at that time. Upon exercise of the option, the excess of
the fair market value of the shares received upon exercise over the exercise
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<PAGE> 10
price paid will be taxable to the participant as ordinary income, and the
Company will be entitled to a deduction of the same amount. The participant will
receive a tax basis in the shares equal to the fair market value of the shares
on the date of exercise. (The participant may experience different tax
consequences upon exercise of the option, however, if he uses shares of Company
stock he already owns to pay all or part of the exercise price, as permitted by
the Plan, and the amount of the deduction available to the Company may be
different in such a case.) When a participant disposes of shares acquired upon
exercise of an option granted under the Plan, the difference between any amount
realized on the disposition and the participant's tax basis in the shares
generally will be capital gain or loss. The gain or loss will be long-term gain
or loss if the participant has held the shares for more than one year, and it
will be short-term gain or loss if the participant has held the shares for one
year or less. The Company will experience no income tax consequences as a result
of the participant's disposition of the shares.
EXECUTIVE OFFICERS
The executive officers of the Company are:
<TABLE>
<CAPTION>
NAME PRESENT OFFICE OR POSITION AGE
---- -------------------------- ---
<S> <C> <C>
Robert M. Rogers............................ Chairman of the Board and Chief 70
Executive Officer
Fred R. Nichols............................. President and Chief Operating Officer 50
Melvin R. Jenschke.......................... Vice President -- Engineering 55
Jimmie F. Taylor............................ Vice President, Chief Financial 43
Officer and Treasurer
Jerry P. Yandell............................ Vice President -- Operations 58
</TABLE>
Robert M. Rogers founded the Company and each of its subsidiaries and has
served as Chairman of the Board of Directors and CEO of the Company and each of
the Company's subsidiaries, excluding VPI Communications, Inc., since their
inception. Mr. Rogers was President of the Company from its inception in 1981
until September 1990. Mr. Rogers has been actively involved in the ownership and
operation of cable television systems since 1954. Mr. Rogers is an officer,
director and shareholder of the two systems for which corporations affiliated
with the Company provide general management services. He is a member of the
cable television Pioneers' Club.
Fred R. Nichols is President, Chief Operating Officer and a Director of the
Company. Prior to being named President in September 1990, Mr. Nichols served as
Executive Vice President and a Director of the Company since its inception,
Chief Operating Officer of the Company since December 1983 and Secretary of the
Company from September 1984 to December 1990. He had been Treasurer of the
Company's subsidiaries from 1980 until 1985 when he was named President of TCA
Management Company and all other wholly-owned subsidiaries of the Company,
excluding VPI Communications, Inc. Mr. Nichols is currently on the Executive
Committee of the Board of Directors of the Cable Telecommunications Association
(CATA), a trade association of the cable industry, and of C-SPAN, a cable
television network.
Melvin R. Jenschke has served as a Vice President of the Company since
March 25, 1987. He has been with the Company since 1969 serving in several
capacities prior to becoming Senior Vice President -- Engineering for TCA
Management Company in 1983.
Jimmie F. Taylor is Vice President, Chief Financial Officer and Treasurer
of the Company. Prior to being named Vice President in December, 1990, Mr.
Taylor served as Chief Financial Officer and Treasurer of the Company since
November 1, 1986. He had been Controller of the Company's wholly-owned
subsidiary, TCA Management Company, since joining the Company in May, 1984.
Immediately prior to joining the Company, he was employed for nine years in
public accounting. Mr. Taylor is a Certified Public Accountant.
Jerry P. Yandell is Vice President -- Operations of the Company. Prior to
being named Vice President -- Operations in 1990, he had served as Vice
President since 1987. He has been Senior Vice President --
7
<PAGE> 11
Operations of TCA Management Company since 1990, serving as Senior Vice
President -- Personnel from 1979 until 1990. Immediately prior to joining the
Company, he was employed as Personnel Director for General Electric in Tyler,
Texas, where he had been for eighteen years. Mr.Yandell has served on the Board
of Directors of the Texas Cable and Telecommunications Association since 1982.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding compensation
paid during the Company's last three fiscal years to the Company's Chief
Executive Officer and the Company's four other most highly compensated executive
officers (collectively, the "Named Executive Officers").
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL ------------
COMPENSATION NUMBER OF
---------------- SECURITIES ALL OTHER
NAME AND FISCAL SALARY UNDERLYING COMPENSATION
PRINCIPAL POSITION YEAR ($) OPTIONS/SARS ($)
------------------ ------ ------- ------------ ------------
<S> <C> <C> <C> <C>
Robert M. Rogers, 1996 211,280(1) 20,000 6,293(2)
Chairman of the Board and 1995 192,422(1) -- 5,723
Chief Executive Officer 1994 191,250(1) -- 5,582(3)
Fred R. Nichols 1996 230,394(1) 40,000 10,498(4)
President, Chief Operating 1995 203,958(1) -- 10,172
Officer and Director 1994 186,566(1) 25,000 9,522(5)
Melvin R. Jenschke 1996 110,301 2,500 3,331(6)
Vice President -- 1995 105,209 2,500 3,442
Engineering 1994 97,744 4,000 3,194
Jimmie F. Taylor 1996 109,697 2,500 3,313(7)
Vice President, Chief 1995 100,698 2,500 3,135
Financial Officer and Treasurer 1994 96,217 4,000 2,991
Jerry P. Yandell 1996 110,306 2,500 3,331(8)
Vice President -- Operations 1995 101,697 2,500 3,485
1994 96,854 4,000 3,683
</TABLE>
- ---------------
(1) Includes director's fees paid.
(2) Consists of Company contributions under the Company's Deferred Savings and
Retirement Plan of $6,278 and premiums paid on term life insurance policies
for the executive's benefit of $15.
(3) Additionally, effective September 1, 1994, Mr. Rogers was granted incentive
options to purchase 10,000 shares of Class A Common Stock of TCA
Communications, Inc. ("TCA Communications") at an exercise price of $7.93
per share, which was the per share fair market value of such shares at the
date of grant as determined by the Board of Directors of TCA Communications.
A wholly-owned subsidiary of the Company owns a 50% equity interest in TCA
Communications. Effective January 1, 1997, TCA Communications distributed
certain assets primarily related to its long distance operations and
internet operations in East Texas to Lufkin-Conroe Telecommunications
Corporation ("LCT") in exchange for LCT's 50% ownership interest in TCA
Communications.
(4) Consists of Company contributions under the Company's Deferred Savings and
Retirement Plan of $6,852, premiums paid on term life insurance policies for
the executive's benefit of $46 and a $300/month car allowance.
(5) Additionally, effective September 1, 1994, Mr. Nichols was granted incentive
options to purchase 15,000 shares of Class A Common Stock of TCA
Communications at an exercise price of $7.93 per share.
8
<PAGE> 12
(6) Consists of Company contributions under the Company's Deferred Savings and
Retirement Plan of $3,309 and premiums paid on term life insurance policies
for the executive's benefit of $22.
(7) Consists of Company contributions under the Company's Deferred Savings and
Retirement Plan of $3,291 and premiums paid on term life insurance policies
for the executive's benefit of $22.
(8) Consists of Company contributions under the Company's Deferred Savings and
Retirement Plan of $3,309 and premiums paid on term life insurance policies
for the executive's benefit of $22.
OPTION GRANTS DURING 1996 FISCAL YEAR
The following table provides information related to options granted to the
Named Executive Officers during fiscal 1996.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
OF STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(1)
-------------------------------------------------------- ---------------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO EXERCISE OR
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED(#)(2) FISCAL YEAR ($/SH)(3) DATE(4) 5% 10%
---- ------------- ------------ ------------ ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Robert M. Rogers....... 14,540 21.5% $30.25 12/13/02 $179,057 $ 417,279
Robert M. Rogers....... 5,460 8.1 27.50 12/13/02 61,126 142,450
Fred R. Nichols........ 40,000 59.3 27.50 12/13/02 447,810 1,043,589
Melvin R. Jenschke..... 2,500 3.7 27.50 12/13/02 27,988 65,224
Jimmie F. Taylor....... 2,500 3.7 27.50 12/13/02 27,988 65,224
Jerry P. Yandell....... 2,500 3.7 27.50 12/13/02 27,988 65,224
</TABLE>
- ---------------
(1) The potential realizable value portion of the foregoing table illustrates
value that might be realized upon exercise of the options immediately prior
to the expiration of their term, assuming the specified compounded rates of
appreciation on the Company's Common Stock over the term of the options.
These numbers do not take into account provisions of certain options
providing for termination of the option following termination of employment,
nontransferability or vesting over periods of up to four years.
(2) Options to acquire shares of Common Stock.
(3) The option exercise price may be paid in shares of Common Stock owned by the
executive officer, in cash, or in any other form of valid consideration or a
combination of any of the foregoing, as determined by the Compensation and
Stock Option Committee in its discretion.
(4) Options become exercisable with respect to 25% of the shares covered thereby
on each of December 13, 1996, 1997, 1998 and 1999. The exercise price was
equal to the fair market value of the Common Stock on the date of grant.
9
<PAGE> 13
OPTION/SAR EXERCISES DURING 1996 FISCAL YEAR AND FISCAL YEAR END OPTION/SAR
VALUES
The following table provides information related to options exercised by
the Named Executive Officers during the 1996 fiscal year and the number and
value of options held at fiscal year end. The Company does not have any
outstanding stock appreciation rights.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS/SARS
ACQUIRED VALUE OPTIONS/SARS AT FY-END(#) AT FY-END($)(1)
ON EXERCISE REALIZED --------------------------- ---------------------------
NAME (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Robert M. Rogers......... -- -- -- 20,000 -- (54,985)
Fred R. Nichols.......... 10,000 117,500 20,000 55,000 65,313 5,313
Melvin R. Jenschke....... -- -- 3,375 7,125 8,844 9,156
Jimmie F. Taylor......... -- -- 4,875 7,125 17,844 9,156
Jerry P. Yandell......... -- -- 4,875 7,125 17,844 9,156
</TABLE>
- ---------------
(1) The closing price for the Company's Common Stock as reported by Nasdaq on
October 31, 1996 was $26.75. Value is calculated on the basis of the
difference between the option exercise price and $26.75 multiplied by the
number of shares of Common Stock underlying the option.
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements with each of Messrs.
Nichols, Jenschke, Taylor and Yandell (the "Employment Agreements") that, among
other things, provide for salary and benefits under both the Employment
Agreement and upon termination. Under the Employment Agreements, the Company may
terminate the employment of each employee with or without cause or upon the
death or disability of the employee. The employee may terminate his employment
upon ninety (90) days notice without cause or in the event the Company demotes
the employee or decreases the employee's salary or benefits and perquisites
below the level provided in the Employment Agreement (a "Constructive
Termination"). Absent a change of control, (i) in the event that an employee's
employment is terminated by the Company for cause or by the employee other than
pursuant to a Constructive Termination, the employee is compensated through the
date of termination, (ii) in the event that the employee's employment is
terminated by the Company without cause or by the employee following a
Constructive Termination, the employee is entitled to receive base salary for 90
days following termination and (iii) in the event of the termination of an
employee's employment because of disability, the employee is entitled to receive
his base salary for a period of 180 days following termination. The Employment
Agreements provide that in the event the employee is terminated by the Company
for any reason following a change of control or the employee terminates his
employment due to a Constructive Termination following a change of control, the
employee shall be entitled to receive an amount of cash equal to 2.99 times the
employee's average annual compensation during the previous five full taxable
years and insurance benefits substantially similar to those received immediately
prior to termination for the employee and his immediate family. The Company is
also obligated to pay legal fees and expenses incurred by the employee to
enforce the change of control provision. Additionally, the Employment Agreements
contain a covenant not to divulge confidential information about the Company and
a covenant not to compete with the Company for a period of one year following
termination.
COMPENSATION OF DIRECTORS
Each of the Company's directors receives $500 per quarter for service as a
director. Additionally, Messrs. Fisch, McKinney and Riter receive $500 per
meeting attended and Messrs. Ackerman, Gunter and Smith receive $1,000 per
meeting attended. Additionally, if approved by the shareholders at this Annual
Meeting, the non-employee directors will be eligible to participate in the 1996
Non-Employee Directors' Stock Option Plan, which is described under Proposal 2
in this Proxy Statement.
10
<PAGE> 14
REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEE OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION
The members of the Compensation and Stock Option Committee (the
"Committee") are James F. Ackerman, Chairman, Ben R. Fisch, M.D. and A.W. Riter,
Jr. In determining the compensation to be paid to the Company's executive
officers in fiscal 1996, the Committee employed compensation policies designed
to align the compensation with the Company's overall business strategy. These
policies are intended to (i) reward executives for long-term strategic
management and the enhancement of shareholder value, (ii) support a
performance-oriented environment that rewards achievement of initial Company
goals and recognizes Company performance compared to performance levels of
comparable companies in the cable industry, and (iii) attract and retain
executives whose abilities are critical to the long-term success and
competitiveness of the Company.
The key components of executive officer compensation, salary and stock
option awards, are determined annually in the discretion of the Committee. The
Committee considers each executive officer's level of responsibility in setting
executive compensation, meaning that the Company pays higher levels of
compensation to persons having higher levels of responsibility. The Committee
also considers compensation levels among other public companies in the cable
television industry in setting executive officer compensation. These businesses
include, but are not limited to, the companies reflected in the peer group index
in the Stock Performance Chart. The Committee makes these comparisons in an
effort to determine whether the Company's executive compensation is reasonable
and remains competitive enough to allow the Company to retain skilled
executives. The Committee believes that the compensation paid to its executive
officers, including its Chief Executive Officer ("CEO"), are on the low end of
the compensation of executive officers of companies to which these comparisons
are made. Finally, in setting executive officer compensation the Committee
considers the Company's performance in terms of stock price, earnings and cash
flow. Earnings and cash flow increased during fiscal 1994, 1995 and 1996. The
stock price decreased in 1994, increased in 1995 and decreased in 1996. However,
no part of executive compensation is strictly tied to performance criteria.
Therefore, even in a year in which stock price, earnings and cash flow were flat
or down, the Committee could, in its discretion, grant increases in executive
compensation. The Committee traditionally has not granted bonuses to executive
officers but may, in its discretion, grant bonuses from time to time as it deems
appropriate. In determining executive compensation levels, the Company believes
that it affords approximately equal weight to each of the factors described
herein. In December 1995, all executive officers were granted stock options.
Exercise prices for all stock option grants are made at the fair market value of
the Company's Common Stock on the dates granted. When making stock option awards
to executive officers, the Committee bases the size of the awards on the
foregoing factors. In determining the amount of options granted, the Committee
considers the amount and terms of options already held.
The Committee increased the CEO's salary approximately $20,000 to
approximately $210,000 in fiscal 1996. The Committee set the fiscal 1996
compensation of the Company's CEO on the basis of the CEO's level of
responsibility, comparisons to salaries of chief executive officers of
businesses the Committee deemed comparable (as described above) and the
Company's performance in terms of stock price, earnings and cash flow. Earnings
and cash flow increased in fiscal 1994, 1995 and 1996. The stock price decreased
in 1994, increased in 1995 and decreased in 1996. As stated previously, the
Committee believes that the CEO's compensation is on the low end of compensation
of chief executive officers of companies to which comparisons were made, but the
Committee believes that the CEO's compensation remains competitive enough to
allow the Company to retain a skilled chief executive officer. The CEO's fiscal
1996 compensation was based in part on the Company's stock price, earnings and
cash flow, but was in no way specifically tied to any of those factors pursuant
to a formula or other objective criteria. The CEO was not paid a bonus during
fiscal 1996.
This report is submitted by the members of the Compensation and Stock
Option Committee:
James F. Ackerman, Chairman
Ben R. Fisch, M.D.
A.W. Riter, Jr.
11
<PAGE> 15
COMPENSATION AND STOCK OPTION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation and Stock Option Committee are James F.
Ackerman, Ben R. Fisch, M.D. and A.W. Riter, Jr. None of these individuals was
an officer or employee of the Company during fiscal 1996.
STOCK PERFORMANCE CHART
The following chart compares the yearly percentage change in the cumulative
total stockholder return on the Company's Common Stock during the five fiscal
years ended October 31, 1996 with the cumulative total return on (i) the S&P 500
Index and (ii) peer group consisting of businesses engaged in the cable
television industry selected by the Company for use in this proxy statement
("Peer Group"). The comparison assumes $100 was invested on October 31, 1991 in
the Company's Common Stock and in each of the foregoing indices and assumes
reinvestment of dividends.
TOTAL SHAREHOLDER RETURNS
(DIVIDENDS REINVESTED)
<TABLE>
<S> <C> <C> <C> <C>
S&P 500 COMPOS-
COMPANY/INDEX TCA CABLE TV INC ITE PEER GROUP
OCT-91 100 100 100
OCT-92 107.46 109.95 101.27
OCT-93 170.68 126.39 189.55
OCT-94 139.77 131.27 145.95
OCT-95 179.54 165.98 151.66
OCT-96 165.49 205.97 142.73
</TABLE>
The businesses included in the Peer Group are: Adelphia Communications
Corporation (Class A Stock); Cablevision Systems Corporation (Class A Stock);
Century Communications Corp. (Class A Stock); Comcast
Cablevision -- Philadelphia; Comcast Corporation (Class A Stock); Falcon Cable
Systems Company, a California Limited Partnership; Galaxy Cablevision, L.P.;
Jones Intercable Investors, L.P. (Class A Stock); Jones Intercable, Inc.; Jones
Spacelink, Ltd. (Class A Stock); the Company; Tele-Communications, Inc. (Class A
Stock); Time Warner Inc.; and The Times Mirror Company (Series A Stock). The
returns of each component issuer in the foregoing group have been weighted
according to the respective issuer's stock market capitalization.
CERTAIN TRANSACTIONS
Rogers Venture Enterprises, Inc., a corporation owned 50% by Robert M.
Rogers, Chairman of the Board and Chief Executive Officer of the Company, owns
the building in which the Company's principal executive
12
<PAGE> 16
offices are located. The Company currently pays $26,542.92 per month for its
lease, with the Company paying for utilities and janitorial services. The
Company believes that the terms of such lease are at least as favorable as would
be obtainable from a third-party lessor. Total amounts paid by the Company under
this lease during fiscal 1996 were $318,515.
During fiscal 1996, the Company paid $7,572,130 to Media Technologies, Ltd.
for distribution system construction services. Media Technologies, Ltd. is a
limited partnership in which Kenneth S. Gunter beneficially owns a 60% equity
interest and the Company beneficially owns a 40% equity interest.
SECTION 16(A) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's directors and
officers, and persons who own more than 10% of a registered class of the
Company's equity securities, to file initial reports of ownership and reports of
changes in ownership with the Securities and Exchange Commission (the "SEC") and
Nasdaq. Such persons are required by SEC regulation to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it with
respect to fiscal 1996, or written representations from certain reporting
persons, the Company believes that all filing requirements applicable to its
directors, officers and persons who own more than 10% of a registered class of
the Company's equity securities have been complied with, except that Louise H.
Rogers filed late one Form 5 reporting three transactions, Wayne J. McKinney
filed late one Form 5 reporting one transaction and Kenneth S. Gunter filed late
one Form 5 reporting one transaction and one Form 3 reporting one transaction.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The Company's principal auditors are Coopers & Lybrand, LLP. A
representative of Coopers & Lybrand will be present at the Annual Meeting and
will have the opportunity to make any desired statement and will be available to
respond to appropriate questions.
SHAREHOLDER PROPOSALS
Shareholders may submit proposals on matters appropriate for shareholder
action at subsequent annual meetings of the Company consistent with Rule 14a-8
of the Exchange Act. For such proposals to be considered for inclusion in the
Proxy Statement and Proxy relating to the 1998 Annual Meeting of Shareholders
such proposals must be received by the Company not later than October 27, 1997.
Such proposals should be directed to TCA Cable TV, Inc., Corporate Secretary,
P.O. Box 130489, Tyler, Texas 75713-0489.
OTHER MATTERS
Management does not know of any matters to be brought before the meeting
other than those referred to herein. If any matters properly come before the
meeting, the persons designated as proxies will vote thereon in accordance with
their best judgment in the interest of the Company.
13
<PAGE> 17
MISCELLANEOUS
The Annual Report to Shareholders of the Company, including financial
statements for the fiscal year ended October 31, 1996, accompanies this Proxy
Statement. The Annual Report is not to be deemed part of this Proxy Statement.
PLEASE DATE, SIGN AND RETURN THE ENCLOSED PROXY AT YOUR EARLIEST
CONVENIENCE IN THE ENVELOPE PROVIDED FOR THAT PURPOSE. NO POSTAGE IS REQUIRED
FOR MAILING IN THE UNITED STATES.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ KAREN L. GARRETT
KAREN L. GARRETT
Corporate Secretary
Tyler, Texas
February 24, 1997
14
<PAGE> 18
APPENDIX A
TCA CABLE TV, INC.
1996 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN
1. PURPOSE. The purpose of this 1996 Non-Employee Directors' Stock Option
Plan (the "Plan") of TCA Cable TV, Inc., a Texas corporation (the "Company"), is
to advance the interests of the Company and its shareholders by providing a
means to attract and retain highly qualified persons to serve as non-employee
directors of the Company and to enable such persons to acquire or increase a
proprietary interest in the Company, thereby promoting a closer identity of
interests between such persons and the Company's shareholders.
2. DEFINITIONS. In addition to terms defined elsewhere in the Plan, the
following are defined terms under the Plan:
(a) "Code" means the Internal Revenue Code of 1986, as amended from
time to time. References to any provision of the Code shall be deemed to
include regulations thereunder and successor provisions and regulations
thereunder.
(b) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time. References to any provision of the Exchange Act
shall be deemed to include rules thereunder and successor provisions and
rules thereunder.
(c) "Fair Market Value" of a Share on a given date means the last
sales price or, if last sales information is generally unavailable, the
average of the closing bid and asked prices per Share on such date (or, if
there was no trading or quotation in the stock on such date, on the next
preceding date on which there was trading or quotation) as reported in the
Wall Street Journal.
(d) "Non-Employee Director" means any member of the Board of Directors
who is not currently employed by the Company or any of its "subsidiary
corporations" as that term is defined in Section 424(f) of the Code.
(e) "Option" means the right, granted to a Non-Employee Director under
Section 7, to purchase a specified number of Shares at the specified
exercise price for a specified period of time under the Plan. Options
granted under the Plan will not be incentive stock options within the
meaning of Section 422 of the Code.
(f) "Participant" means a person who, as a Non-Employee Director of
the Company, has been granted an Option which remains outstanding.
(g) "Share" means a share of common stock, $.10 par value, of the
Company and such other securities as may be substituted for such Share or
such other securities pursuant to Section 8.
3. SHARES AVAILABLE UNDER THE PLAN. Subject to adjustment as provided in
Section 8, the total number of Shares reserved and available for issuance under
the Plan is 250,000. Such Shares may be authorized but unissued shares, treasury
shares, or shares acquired in the market for the account of the Participant. For
purposes of the Plan, Shares that may be purchased upon exercise of an Option
will not be considered to be available after such Option has been granted;
provided, however, that, if an Option expires for any reason without having been
exercised in full, the Shares subject to the unexercised portion of such Option
will again be available for issuance under the Plan.
4. ADMINISTRATION OF THE PLAN. The Plan will be administered by a committee
of not fewer than two members of the Board of Directors who are not Non-Employee
Directors ("the Committee," with each member of the Committee being a "Committee
Member"). Subject to the provisions of the Plan, the Committee shall have the
sole discretion and authority to prescribe, amend and rescind any rules and
regulations necessary or appropriate for the administration of the Plan, to
determine and interpret the details and provisions of each option agreement, to
modify or amend any option agreement or waive any conditions or restrictions
applicable to any Options (or the exercise thereof) and to make all other
determinations necessary
A-1
<PAGE> 19
or advisable for the administration of the Plan. The Board of Directors may from
time to time remove members from or add members to the Committee. Vacancies on
the Committee, however caused, shall be filled by the Board of Directors. The
Committee shall select one of its members as Chairman, and shall hold meetings
at such times and places as it may determine. Actions by a majority of the
Committee at which a quorum is present, or actions reduced to or approved in
writing by a majority of the Committee Members, shall be the valid actions of
the Committee. No Committee Member shall be liable for any action or
determination made in good faith with respect to the Plan or any Option granted
under it.
5. INDEMNIFICATION OF COMMITTEE. In addition to such other rights of
indemnification as they may have as directors or Committee Members, the
Committee Members shall be indemnified by the Company against the reasonable
expenses, including attorney's fees actually and necessarily incurred in
connection with the defense of any action, suit or proceeding, or in connection
with any appeal therein, to which they or any of them may be a party by reason
of any action taken or failure to act under or in connection with the Plan or
any Option thereunder, and against all amounts paid by them in settlement
thereof (provided such settlement is approved by independent legal counsel
selected by the Company) or paid by them in satisfaction of a judgment in any
such action, suit or proceeding, except in relation to matters as to which it
shall be adjudged in such action, suit or proceeding that such Committee Member
is liable for negligence or misconduct in the performance of his duties,
provided that within 60 days after institution of any such action, suit or
proceeding that Committee Member shall in writing offer the Company the
opportunity, at its own expense, to handle and defend the same.
6. ELIGIBILITY. Each Non-Employee Director of the Company will be eligible
to be granted Options under Section 7.
7. OPTIONS. Each Non-Employee Director shall automatically receive an
Option to purchase 5,000 Shares on the Effective Date of the Plan or at the
effective date of initial election to the Board of Directors. In addition, an
Option to purchase 2,500 Shares will be automatically granted to each
Non-Employee Director then serving at the close of business on the day of the
Company's Annual Meeting of Shareholders.
(a) Exercise Price. The per share price at which Shares may be
purchased upon exercise of an Option will be equal to 100% of the Fair
Market Value of a Share on the date the Option is granted.
(b) Option Expiration. A Participant's Option will expire at the
earlier of (i) 10 years after the Option is granted or (ii) one year after
the date the Participant ceases to serve as a director of the Company for
any reason.
(c) Exercisability. Each Option may be exercised immediately upon its
grant.
(d) Method of Exercise. A Participant may exercise an Option, in whole
or in part, by (i) giving written notice of exercise to the Secretary of
the Company, specifying (A) the Option to be exercised and (B) the number
of Shares to be purchased and (ii) paying in full the exercise price (A) in
cash (including by check), (B) by surrender of Shares already owned by the
Participant having a Fair Market Value at the time of exercise equal to the
exercise price or (C) by a combination of cash and Shares.
8. ADJUSTMENT PROVISIONS.
(a) Capital Adjustments Affecting Stock. In the event of a capital
adjustment resulting from a stock dividend, stock split, reorganization,
merger, consolidation or a combination or exchange of shares, the number of
Shares subject to this Plan and the number of Shares subject to each Option
shall be adjusted consistent with such capital adjustment. The granting of
an Option pursuant to this Plan shall not affect in any way the right or
power of the Company to make adjustments, reorganization, reclassifications
or changes of its capital or business structure or to merge, consolidate,
dissolve, liquidate or sell or transfer all or any part of its business
assets.
(b) Insufficient Number of Shares. If at any date an insufficient
number of Shares is available under the Plan, Options shall be
automatically granted proportionately to each Non-Employee Director.
A-2
<PAGE> 20
9. CHANGES TO THE PLAN. The Board of Directors may amend, alter, suspend,
discontinue or terminate the Plan or authority to grant Options without the
consent of shareholders or Participants, except that any amendment or alteration
will be subject to the approval of the Company's shareholders at or before the
next Annual Meeting of Shareholders if such shareholder approval is required by
any federal or state law or regulation or the rules of any stock exchange or
automated quotation system as then in effect; provided, however, that, without
the consent of an affected Participant, no such action may materially impair the
rights of such Participant with respect to any previously granted Option.
10. GENERAL PROVISIONS.
(a) Agreements. Options and any other right or obligation under the
Plan may be evidenced by agreements or other documents executed by the
Company, or by the Company and the Participant, incorporating the terms and
conditions set forth in the Plan, together with such other terms and
conditions not inconsistent with the Plan, as the Committee may from time
to time approve. A Participant's acceptance of an Option shall constitute
his agreement to all of the terms of the Option and this Plan.
(b) Compliance with Laws and Obligations. The Company will not be
obligated to issue or deliver Shares in connection with any Option in a
transaction subject to the registration requirements of the Securities Act
of 1933, as amended, or any other federal or state securities law, any
requirement under any listing agreement between the Company and any stock
exchange or automated quotation system, or any other law, regulation or
contractual obligation of the Company, until the Company is satisfied that
such laws, regulations and other obligations of the Company have been
complied with in full. Certificates representing Shares issued under the
Plan will be subject to such stop-transfer orders and other restrictions as
may be applicable under such laws, regulations and other obligations of the
Company, including any requirement that a legend or legends be placed
thereon.
(c) No Right To Continue as a Director. Nothing contained in the Plan
or any agreement hereunder will confer upon any Participant any right to
continue to serve as a director of the Company.
(d) No Shareholder Rights Conferred. Nothing contained in the Plan or
any agreement hereunder will confer upon any Participant (or any person or
entity claiming rights by or through a Participant) any rights of a
shareholder of the Company unless and until Shares are in fact issued to
such Participant (or person) or, in the case of an Option, such Option is
validly exercised in accordance with Section 7.
(e) Nonexclusivity of the Plan. The adoption of the Plan by the Board
of Directors shall not be construed as creating any limitations on the
power of the Board to adopt such other compensatory arrangements for
Non-Employee Directors as it may deem desirable.
(f) Governing Law. The validity, construction and effect of the Plan
and any agreement hereunder will be determined in accordance with the laws
of the State of Texas.
11. SHAREHOLDER APPROVAL, EFFECTIVE DATE AND PLAN TERMINATION. The Plan
will be effective as of the date of its adoption by the Board of Directors,
subject to shareholder approval, (or, if later, on August 15, 1996) and, unless
earlier terminated by action of the Board, shall terminate at such time as no
Shares remain available for issuance under the Plan and the Company and
Participants have no further rights or obligations under the Plan.
A-3
<PAGE> 21
TCA CABLE TV, INC.
PROXY - ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints Robert M. Rogers and Fred R. Nichols,
or either of them, with full power of substitution, as Proxies to vote, as
designated on the reverse, all stock of TCA Cable TV, Inc., owned by the
undersigned at the Annual Meeting of Shareholders to be held at Sheraton Tyler
Hotel, 5701 S. Broadway, Tyler, Texas on Friday, March 21, 1997, at 3:30 p.m.,
local time, upon such business as may properly come before the meeting, or any
adjournment thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO SPECIFIC DIRECTION IS
GIVEN, THIS PROXY WILL BE VOTED (1) FOR THE ELECTION OF THE NINE NOMINEES FOR
DIRECTOR, (2) FOR THE PROPOSED 1996 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN,
AND (3) AT THE DISCRETION OF THE PROXY HOLDERS WITH REGARD TO ANY OTHER MATTER
THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE> 22
Please mark [x]
your votes as
indicated in
this example
(1) Election of Directors:
FOR all nominees WITHHOLD
listed to the right AUTHORITY
(except as marked to vote for all
to the contrary) nominees listed
to the right
[] []
(2) Approval of the 1996 Non-Employee
Directors' Stock Option Plan as
described in the proxy statement
FOR AGAINST ABSTAIN
[] [] []
James F. Ackerman, Ben R. Fisch, M.D., Kenneth S. Gunter, Wayne J. McKinney,
Fred R. Nichols, A.W. Riter, Jr., Randall K. Rogers, Robert M. Rogers and
Fred W. Smith
(Instruction: to withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below.)
- ---------------------------------------------------------------------------
(3) In their discretion on any other matter
that may properly come before the
meeting or any adjournment thereof.
Dated: , 1997
-----------------
No. Of Shares:
-------------
-------------------------------
(Signature)
-------------------------------
(Signature if held jointly)
Please date, sign and mail promptly
this proxy in the enclosed envelope.
Where there is more than one owner,
each should sign. When signing as an
attorney, administrator, executor,
guardian or trustee, please add your
title as such. If executed by a
corporation, the proxy should be signed
by a duly authorized officer. If
executed by a partnership, please sign
in the partnership name by an authorized
person.
This proxy may be revoked prior to the exercise of the powers
conferred by the proxy. THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS.
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FOLD AND DETACH HERE
