<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 [ ]
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
PMC Capital, 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)(l) 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> 2
PMC CAPITAL, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
THURSDAY, MAY 14, 1998
To the Shareholders of PMC CAPITAL, INC.:
The Annual Meeting of Shareholders of PMC Capital, Inc. (the "Company")
will be held at its corporate headquarters, 17290 Preston Road, 3rd Floor,
Dallas, Texas, on Thursday, May 14, 1998, at 9:30 a.m., local time, for the
following purposes:
(1) To elect three directors, each to hold office for a term of three
years and until their respective successors shall have been elected
and qualified;
(2) To ratify the appointment of Coopers & Lybrand L.L.P. as the
independent public accountants of the Company; and
(3) To transact such other business as may properly come before such
meeting.
March 31, 1998 has been fixed as the date of record for determining
shareholders entitled to receive notice of and to vote at the Annual Meeting.
By Order of the Board of Directors,
/s/ LANCE B. ROSEMORE
Lance B. Rosemore,
Secretary
April 14, 1998
YOUR VOTE IS IMPORTANT. PLEASE DATE, VOTE, SIGN AND MAIL BACK THE ENCLOSED
PROXY AT YOUR EARLIEST CONVENIENCE. THE ENCLOSED RETURN ENVELOPE MAY BE USED FOR
THAT PURPOSE.
<PAGE> 3
PMC CAPITAL, INC.
PMC CAPITAL BUILDING
17290 PRESTON ROAD
THIRD FLOOR
DALLAS, TEXAS 75252
PROXY STATEMENT
The persons named in the accompanying form of proxy have been authorized to
solicit proxies from shareholders of PMC Capital, Inc. (the "Company") on behalf
of the Board of Directors of the Company for use at the Annual Meeting of
Shareholders to be held on May 14, 1998 (the "Annual Meeting") and at any
adjournments thereof. The notice of the Annual Meeting, the proxy statement and
the form of proxy are mailed to shareholders of the Company on or about April
14, 1998. Any shareholder giving a proxy in the accompanying form will retain
the power to revoke it prior to its exercise by later proxy received by the
Company or by giving notice of revocation to the Company in writing or at the
Annual Meeting.
RECORD DATE; VOTING SECURITIES
The record date for shareholders entitled to vote at the Annual Meeting is
the close of business on March 31, 1998 (the "Record Date") at which time the
Company had issued and outstanding 11,795,035 shares of its common stock, par
value $.01 per share (the "Common Stock"). The Common Stock is the only class of
capital stock of the Company issued and outstanding. In deciding all questions,
a holder of Common Stock shall be entitled to one vote for each share.
PURPOSE OF THE ANNUAL MEETING
At the Annual Meeting, the Company's shareholders will be asked to consider
and vote on the following proposals:
(i) To elect three directors for terms to expire at the 2001 annual
meeting of shareholders and until their respective successors have
been elected and qualified;
(ii) To ratify the appointment of Coopers & Lybrand L.L.P. as the
independent public accountants of the Company for the fiscal year
ending December 31, 1998; and
(iii) To transact such other business as may properly come before the
Annual Meeting.
The Board of Directors does not know of any other matter that is to come before
the Annual Meeting. If any other matters are properly presented for
consideration, however, the persons authorized by the enclosed proxy will have
directions to vote on such matters in accordance with their best judgment.
QUORUM AND VOTING REQUIREMENTS
The holders of record of a majority of the outstanding shares of Common
Stock at the Record Date will constitute a quorum for the transaction of
business at the Annual Meeting. If a quorum should not be present or represented
at the Annual Meeting, the shareholders present or represented at the Annual
Meeting may adjourn the Annual Meeting from time to time without notice other
than announcement at the Annual Meeting until a quorum is obtained.
Each share of Common Stock may be voted for up to three (3) individuals
(the number of directors to be elected) as directors of the Company. The three
(3) nominees for director receiving the highest number of votes cast by holders
of shares of Common Stock present or represented by proxy at the Annual Meeting,
if a quorum is present thereat, will be elected as directors by the Company. It
is intended that, unless authorization to vote for one or more
<PAGE> 4
nominees for director is withheld, proxies will be voted FOR the election of all
of the nominees set forth in this Proxy Statement.
Approval of a majority of the shares of Common Stock represented and voting
at the Annual Meeting will be necessary for ratification of the selection of
Coopers & Lybrand L.L.P. as independent public accountants for the Company for
the year ending December 31, 1998.
Votes cast by proxy or in person will be counted by two persons appointed
by the Company to act as inspectors for the Annual Meeting. The election
inspectors will treat shares represented by proxies that reflect abstentions as
shares that are present and entitled to vote for the purpose of determining the
presence of a quorum and of determining the outcome of any matter submitted to
the shareholders for a vote; however, abstentions will not be deemed outstanding
and, therefore, will not be counted in the tabulation of votes on the proposals
presented to the shareholders.
The election inspectors will treat shares referred to as "broker non-votes"
(i.e., shares held by brokers or nominees as to which instructions have not been
received from the beneficial owners and as to which the broker or nominee does
not have discretionary voting power on a particular matter) as shares that are
present and entitled to vote for the purpose of determining the presence of a
quorum. However, for the purpose of determining the outcome of any matter as to
which the broker or nominee has indicated on the proxy that it does not have
discretionary authority to vote, those shares will be treated as not present and
not entitled to vote with respect to that matter (even though those shares are
considered entitled to vote for quorum purposes and may be entitled to vote on
other matters).
RIGHT TO REVOKE PROXY
Any shareholder giving the proxy enclosed with the Proxy Statement has the
power to revoke such proxy at any time prior to the exercise thereof by giving
notice of such revocation, or by delivering a later-dated proxy, to the
Secretary of the Company prior to the Annual Meeting. Shareholders will also
have an opportunity to revoke their proxies by attending the Annual Meeting and
voting in person (although attendance at the Annual Meeting will not in and of
itself constitute a revocation of a proxy).
I. ELECTION OF DIRECTORS
GENERAL
The Company's Articles of Incorporation currently provide for a Board of
Directors of not less than five (5) and no more than twenty (20) directors, as
fixed, from time to time, by the Board of Directors. Pursuant to the Articles of
Incorporation, the directors are divided into three classes, with each class
serving a three-year term and one class being elected by the shareholders
annually. The Board of Directors currently consists of nine (9) members divided
among the three classes of directors.
NOMINEES
Set forth below is the principal occupation of, and certain other
information with respect to, each of the nominees for election as a director of
the Company, to hold office until the 2001 annual meeting of shareholders and
until their respective successors shall have been elected and qualified. THE
BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE TO ELECT THE THREE NOMINEES FOR
DIRECTORS.
DR. IRVIN M. BORISH - Dr. Borish, 85, served as Benedict (Distinguished)
Professor of Optometry at the University of Houston after retiring from Indiana
University, where he holds the status of Professor Emeritus. He operated a
private practice of optometry for over thirty years. He is the author of a major
text in his field and holds five patents in contact lenses. He has been a
director of the Company since 1989.
MR. THOMAS HAMILL - Mr. Hamill, 44, is vice president of Jardine Sayer &
Company, Inc., the United States reinsurance intermediary subsidiary of Jardine
Lloyd Thompson plc. From 1989 through 1996, Mr. Hamill was president of
2
<PAGE> 5
Caliban Holdings Ltd. ("Caliban") and its subsidiaries, including Belvedere
Insurance Company Ltd. ("Belvedere"). From September 1986 through December 1989,
Mr. Hamill was Vice President of Belvedere Corporation. Mr. Hamill is a
non-executive director and Chairman of the Board of Caliban, Belvedere and
Midlands Management Corporation. Mr. Hamill has been a director of the Company
since 1992, when he was elected pursuant to an agreement between the Company and
Belvedere in April 1991 whereby the directors of the Company agreed at that time
to support a representative of Caliban Holdings in his candidacy for director in
exchange for Belvedere's purchase of 185,000 shares of Common Stock. Mr. Hamill
has no voting control of these shares.
MR. BARRY A. IMBER - Mr. Imber, 51, has been a principal of Imber and
Company, Certified Public Accountants, or its predecessor, since 1982. Imber and
Company was the independent certified public accountant for the Company and its
subsidiaries for the years ended December 31, 1988 through December 31, 1991.
Mr. Imber was trust manager of PMC Commercial Trust, a Texas real estate
investment trust and affiliate of the Company ("PMC Commercial") from September
1993 to March 1995 and a director of the Company since March 1995.
DIRECTORS CONTINUING IN OFFICE
Set forth below is the principal occupation, and certain other information
with respect to, each director of the Company who is continuing in office
following the Annual Meeting.
MR. ROBERT DIAMOND - Mr. Diamond, 66, has been an attorney for 41 years. He
is currently of counsel to the law firm of Diamond & Diamond, P.A., Millburn,
New Jersey. He served as a director of the Company from 1982 to 1992 and
rejoined the Board of Directors in January 1994. He served as a member of the
Board of Directors of Allstate Financial Corporation from 1991 to 1993. He has
managed personal investments since 1991. His term as director expires in 1999.
DR. MARTHA R. GREENBERG* - Dr. Greenberg, 46, has practiced optometry for
24 years in Russellville, Alabama and currently serves on the Board of Trustees
of Southern College of Optometry. Dr. Greenberg has been a trust manager of PMC
Commercial since May 1996 and a director of the Company since 1984. Her term as
director expires in 1999.
DR. FREDRIC M. ROSEMORE* - Dr. Rosemore, 74, has been the Chairman of the
Board and Treasurer of the Company since 1983. From 1990 to 1992, Dr. Rosemore
was a Vice President of the Company and from 1979 to 1990, Dr. Rosemore was the
President of the Company. For many years he was engaged in diverse businesses,
including the construction of apartment complexes, factory buildings, and
numerous commercial retail establishments. From 1948 to 1980, Dr. Rosemore
practiced optometry. He has been a director of the Company since 1983. His term
as director expires in 2000.
MR. LANCE B. ROSEMORE**- Mr. Rosemore, 49, has been Chief Executive Officer
of the Company since May 1992, President of the Company since 1990 and Secretary
since 1983. From 1990 to May 1992, Mr. Rosemore was Chief Operating Officer of
the Company. Previously, Mr. Rosemore has owned a consumer finance company and
has been employed by C.I.T. Financial and United Carolina Bank Shares. Mr.
Rosemore has been a trust manager of PMC Commercial since June 1993 and a
director of the Company since 1983. His term as director expires in 2000.
DR. ANDREW S. ROSEMORE** - Dr. Rosemore, 51, has been Chief Operating
Officer of the Company since May 1992 and Executive Vice President of the
Company since 1990. From 1988 to May 1990, Dr. Rosemore was Vice President of
the Company. From 1973 to 1988, Dr. Rosemore owned and managed commercial rental
properties, apartment complexes and factory buildings. Since 1972, Dr. Rosemore
has been a licensed physician in Alabama. Dr. Rosemore has been a trust manager
of PMC Commercial since June 1993 and a director of the Company since 1988. His
term as director expires in 2000.
MR. LEE RUWITCH - Mr. Ruwitch, 84, is currently the owner of a ministorage
facility, Regency Storage, Inc. which is located in West Palm Beach, Florida.
Mr. Ruwitch has been involved with the daily management of personal investments
since he sold a major legal newspaper business in 1986. He is the President of
LFR Corporation. He sold
3
<PAGE> 6
his interests in TCA Joint Venture in Miami in 1997. He is involved with the
management of the Francien and Lee Ruwitch Charitable Foundation in Miami,
Florida. Mr. Ruwitch was a director of the Company from 1984 to December 1993
and rejoined the board in September 1994. His term as director expires in 1999.
- -----------------------------
* Dr. Martha R. Greenberg is the daughter of Dr. Fredric M. Rosemore.
Consequently, she may be deemed to be an "interested person" as defined
under the Investment Company Act.
** Mr. Lance B. Rosemore and Dr. Andrew S. Rosemore are the sons of Dr.
Fredric M. Rosemore. Dr. Andrew S. Rosemore owns in excess of 5% of the
outstanding shares of Common Stock. Consequently, all such persons may be
deemed to be "interested persons" as defined under the Investment Company
Act of 1940, as amended (the "Investment Company Act").
NOMINATIONS FOR ELECTION TO THE BOARD OF DIRECTORS
The Company does not have a nominating committee. The Board of Directors
considers persons who will be eligible or desirable for membership on the Board
of Directors. Names are solicited from all directors and an effort is made to
obtain information with respect to all such potential nominees for the position
of director. Shareholders wishing to recommend candidates for consideration by
the Board of Directors can do so by writing to the Secretary of the Company at
its offices in Dallas, Texas.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors had four regular (including video conferences)
meetings during 1997. Each person who was a director for the entire year
attended or participated in at least 75% of all regular meetings held by the
Board of Directors and all committees on which such director served during such
year. Non-employee directors were compensated $500 for each meeting they
attended. The Company reimburses the directors for the travel expenses incurred
by them in connection with such meetings.
The Audit Committee of the Board of Directors is currently comprised of Mr.
Hamill and Mr. Imber. The principal functions of the Audit Committee are to
oversee the financial reporting policies, the accounting issues, the portfolio
valuation and the entire audit function of the Company. The Audit Committee
reports its activities to the Board of Directors. The Audit Committee holds
meetings at such times as may be required for the performance of its functions
and, during the year ended December 31, 1997, held one meeting.
There is no compensation committee; however, the Board of Directors as a
whole performs the functions of such committee. The Company has appointed an
Independent Directors Committee currently consisting of Dr. Borish, Mr. Hamill,
Mr. Ruwitch, Mr. Diamond and Mr. Imber, each of whom is otherwise disinterested
with respect to the Company. The Independent Directors Committee, which held two
meetings during 1997, reviews all proposed affiliated transactions to ensure
that such transactions do not violate the appropriate provisions of the
Investment Company Act.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company has no Compensation Committee. Each of Mr. Lance Rosemore and
Dr. Andrew Rosemore participated in deliberations of the Company's Board of
Directors concerning executive compensation for the year ended December 31,
1997. Mr. Lance Rosemore and Dr. Andrew Rosemore serve as executive officers and
members of the Board of Trust Managers of PMC Commercial.
EXECUTIVE OFFICERS
The following table sets forth the names and ages of the executive officers
of the Company (each of whom serves at the pleasure of the Board of Directors),
all positions held with the Company by each individual, and a description of the
business experience of each individual for at least the past five years.
4
<PAGE> 7
<TABLE>
<CAPTION>
Name Age Title
---- --- -----
<S> <C> <C>
Dr. Fredric M. Rosemore 74 Chairman of the Board and Treasurer
Mr. Lance B. Rosemore 49 President, Chief Executive
Officer and Secretary
Dr. Andrew S. Rosemore 51 Executive Vice President and
Chief Operating Officer
Mr. Jan F. Salit 47 Executive Vice President,
Chief Investment Officer
and Assistant Secretary
Mr. Barry N. Berlin 37 Chief Financial Officer
Ms. Mary J. Brownmiller 43 Senior Vice President
Ms. Cheryl T. Murray 31 General Counsel
</TABLE>
For a description of the business experience of Drs. Fredric Rosemore and
Andrew Rosemore and Mr. Lance Rosemore, see "Directors Continuing in Office"
above.
MR. SALIT has been Executive Vice President of the Company since May 1993
and Chief Investment Officer since March 1994. Mr. Salit has also been Executive
Vice President of PMC Commercial since June 1993 and Chief Investment Officer
and Assistant Secretary since January 1994. From 1979 to 1992, Mr. Salit was
employed by Glenfed Financial Corporation and its predecessor company, Armco
Financial Corporation, a commercial finance company, holding various positions
including Executive Vice President and Chief Financial Officer.
MR. BERLIN has been Chief Financial Officer of the Company since November
1992. Mr. Berlin has also been Chief Financial Officer of PMC Commercial since
June 1993. From August 1986 to November 1992, he was an audit manager with Imber
& Company, Certified Public Accountants. Mr. Berlin is a certified public
accountant.
MS. BROWNMILLER has been Senior Vice President of the Company since 1992
and Vice President of the Company since November 1989. Ms. Brownmiller has also
been Senior Vice President of PMC Commercial since June 1993. From 1987 to 1989,
she was Vice President for Independence Mortgage, Inc., a Small Business
Association ("SBA") lender. From 1976 to 1987, Ms. Brownmiller was employed by
the SBA, holding various positions including senior loan officer. Ms.
Brownmiller is a certified public account.
MS. MURRAY has been General Counsel of the Company since March 1994. Ms.
Murray has also been General Counsel of PMC Commercial since March 1994. From
1992 to 1994 she was associated with the law firm of Johnson & Gibbs, P.C. and
practiced in the financial services department. Ms. Murray earned her law degree
from Northwestern University School of Law.
MANAGEMENT COMPENSATION
The following table sets forth the aggregate amount of compensation paid by
the Company during 1997 to each of the three highest paid executive officers and
to all directors of the Company during fiscal year 1997.
5
<PAGE> 8
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Total
Profit Sharing Total Profit Compensation
Capacities in Which Contribution Sharing Benefits Paid
Remuneration Aggregate Accrued During Accrued by Company
Name of Person Received Compensation (1) Last Fiscal Year (2) to Date to Directors(3)
-------------- -------- ---------------- -------------------- ------- ---------------
<S> <C> <C> <C> <C> <C>
Dr. Fredric M. Rosemore Chairman of $156,771 $18,811 $196,345
the Board
Mr. Lance B. Rosemore President, Chief 405,793 18,811 203,183
Executive Officer
Dr. Andrew S. Rosemore Executive Vice 409,909 18,811 167,924
President, Chief
Operating Officer
Mr. Jan F. Salit Executive Vice 205,089 18,811 53,407
President, Chief
Investment Officer
Dr. Irvin M. Borish Director $ 2,000
Mr. Thomas HamillDirector 2,500
Mr. Barry A. Imber Director 2,500
Dr. Martha R. Greenberg Director 2,000
Mr. Robert Diamond Director 2,000
Mr. Lee Ruwitch Director 1,500
</TABLE>
- -------------------
(1) The Company has determined that the amount of perquisites and other
personal benefits paid to each of the executive officers listed in the
compensation table does not exceed the lesser of $50,000 or 10% of each
such person's annual salary and bonus reported in such table and that the
aggregate amount of perquisites and other personal benefits paid to all
executive officers and directors as a group does not exceed the lesser of
10% of all such person's annual salary and bonus or $650,000 ($50,000
multiplied by 13, the number of executive officers and directors).
Accordingly, none of such perquisites and other personal benefits is
included in the above table.
(2) The participants in the Company's profit sharing plan (the "Plan") consist
of all employees who are at least 20-1/2 years old, have been employed by
the Company for six months and are employed at the end of each fiscal year
or have died, become totally disabled or retired after age 65 during such
fiscal year. The Plan is intended to qualify under Section 401(a) of the
Internal Revenue Code of 1986, as amended. A required distribution of
$24,138.43 was paid to Dr. Fredric M. Rosemore. No monies were withdrawn
from the Plan during 1997 for the benefit of Mr. Lance B. Rosemore or Dr.
Andrew S. Rosemore. Mr. Lance B. Rosemore and Dr. Fredric M. Rosemore are
co-administrators of the Plan.
(3) The Company's 1997 Director Stock Option Plan (the "Director Plan")
automatically grants options to purchase 2,000 shares to each non-employee
director on the first June 1st following the effective date of the Director
Plan and to each newly elected non-employee director on the first June 1st
following his or her election to the Board of Directors of the Company.
Additional options to purchase 1,000 shares each June 1st thereafter shall
be granted to each non-employee director so long as such non-employee
director is a director of the Company on such date. The options granted
under the Director Plan become exercisable one year after date of grant and
expire if not exercised on the earlier of (i) thirty (30) days after the
option holder no longer holds office as a director for any reason and (ii)
within five (5) years after the date of grant. In 1997, each non-employee
director was granted an option to acquire 2,000 shares on June 3, 1997 at
an exercise price of $13.5625 per share.
OPTION GRANTS
The following table sets forth information regarding stock options granted
to each of the Executive Officers under the Company's 1997 Employee Share Option
Plan in the fiscal year ended December 31, 1997.
6
<PAGE> 9
<TABLE>
<CAPTION>
Potential
Realizable Value at
Assumed Annual
Number of % of Total Options Rates of Share
Securities Granted to Exercise Final Price Appreciation
Underlying Options Employees Price Exercise for Option Term
Name Granted (#) in Fiscal Year ($/Share) Date (5%) (10%)
---- ----------- -------------- --------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Andrew S. Rosemore 6,985 8.1% $14.3125 6/14/02 $27,620 $61,034
Lance B. Rosemore 6,985 8.1% 14.3125 6/14/02 27,620 61,034
Jan F. Salit 6,500 7.5% 14.3125 6/14/02 25,703 56,796
Barry N. Berlin 6,500 7.5% 14.3125 6/14/02 25,703 56,796
Mary J. Brownmiller 4,000 4.6% 14.3125 6/14/02 15,817 34,952
Cheryl T. Murray 4,000 4.6% 14.3125 6/14/02 15,817 34,952
</TABLE>
EMPLOYMENT AGREEMENTS
The Company entered into employment agreements with the following key
employees: Fredric M. Rosemore, Lance B. Rosemore, Andrew S. Rosemore, Jan F.
Salit, Barry N. Berlin, Mary J. Brownmiller and Cheryl T. Murray. Each of these
employment agreements provides for at least annual reviews by the Board of
Directors of the salaries contained therein, with a mandatory minimum increase
based on percentage increases to the cost of living index. In addition, the
Board of Directors may determine, in its discretion, to award bonuses to each of
the foregoing persons based on the Company's performance. Each of the employment
agreements also provides that if a new board of directors of the Company is put
in place, as a result of the acquisition of the Common Stock by an outside party
or otherwise, and such new board requests the covered executive to resign or
substantially modifies the duties or working conditions of the executive, the
executive could resign and be entitled to be paid by the Company an amount equal
to 2.99 times the average compensation paid to the executive over the last five
years.
II. RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
At a meeting held on December 13, 1997, the Board of Directors, including a
majority of the directors who are not "interested persons" (as defined in the
Investment Company Act) of the Company, selected Coopers & Lybrand L.L.P. as the
independent public accountants of the Company for the year ending December 31,
1998, and such selection is submitted to the shareholders of the Company for
ratification. Coopers & Lybrand L.L.P. will perform the audit of the Company's
financial statements and prepare the Company's tax returns. Representatives of
Coopers & Lybrand L.L.P. will be in attendance at the Annual Meeting, will have
the opportunity to make a statement if they desire to do so and will be
available to respond to appropriate shareholder questions.
THE BOARD OF DIRECTORS RECOMMENDS THE RATIFICATION OF COOPERS & LYBRAND
L.L.P. AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS.
INFORMATION AS TO SHARE OWNERSHIP
On March 31, 1998, the Company had outstanding 11,795,035 shares of Common
Stock. The table below lists, as of the same date, certain information regarding
the beneficial ownership of the Common Stock by all persons who are known by the
Company to be the beneficial owners of more than 5% of the Common Stock, the
directors, the executive officers and by all executive officers and directors as
a group.
7
<PAGE> 10
<TABLE>
<CAPTION>
Names and Addresses Amount and Nature of Percent of
of Beneficial Owners Beneficial Ownership Ownership
-------------------- -------------------- ---------
<S> <C> <C>
Dr. Irvin M. Borish (1) 135,000 1.1%
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Mr. Robert Diamond (2) 353,935 3.0%
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Dr. Martha R. Greenberg *(3) 527,248 4.5%
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Mr. Thomas Hamill (4) 6,000 **
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Mr. Barry A. Imber -- **
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Dr. Andrew S. Rosemore *(5) 774,017 6.6%
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Dr. Fredric Rosemore *(6) 572,187 4.9%
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Mr. Lance B. Rosemore *(7) 224,502 1.9%
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Mr. Lee Ruwitch (8) 398,216 3.4%
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Mr. Jan F. Salit (9) 719 **
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Mr. Barry N. Berlin 315 **
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Ms. Mary J. Brownmiller 2,110 **
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
</TABLE>
8
<PAGE> 11
<TABLE>
<S> <C> <C>
Ms. Cheryl T. Murray 200 **
17290 Preston Road, 3rd Floor
Dallas, Texas 75252
Directors and executive officers 2,994,449 25.4%
as a group (13 persons)
</TABLE>
- ----------------------
(1) Includes 115,000 shares held by a partnership of which Dr. Borish is the
general partner and 20,000 shares held in two charitable lead trusts of
which Dr. Borish is the trustee.
(2) Includes 179,691 shares held in an individual retirement rollover account
and 5,300 shares held in grandchildren's trusts of which he is trustee.
(3) Includes 15,795 shares in which her children have a beneficial interest,
31,400 shares held in an individual retirement account, 127,500 shares held
jointly with her husband, 141,894 shares held in a pension trust, 2,500
shares held by a foundation and 25,300 shares held in trust for the benefit
of Dr. Greenberg and her children. Does not include 225,660 shares owned by
her husband, as to which shares she disclaims any beneficial interest.
(4) Includes 1,000 shares owned by his minor son. Does not include 321,000
shares held by two companies of which Mr. Hamill is a director, as to which
shares he disclaims any beneficial interest.
(5) Includes 368,332 shares held by a partnership of which Dr. Rosemore and his
wife are general partners, 17,550 shares held as custodian for his
children, 354,150 shares held in individual retirement accounts, 24,785
shares held in trust for the benefit of Dr. Rosemore and his children and
9,200 shares held by a partnership for the benefit of Dr. Rosemore and his
children.
(6) Represents shares held by a partnership of which Dr. Fredric M. Rosemore is
a general partner.
(7) Includes 2,892 shares in which his minor children have beneficial interest,
142,989 shares held jointly with his wife, 11,486 shares held in an
individual retirement account, 26,095 shares held in trust for the benefit
of Mr. Rosemore and his children, 6,600 shares held by a partnership for
the benefit of Mr. Rosemore and his children and 4,020 shares owned
individually by Mr. Lance B. Rosemore's wife.
(8) Includes 5,775 shares held in the name of his wife, 387,441 shares held in
various trust of which Mr. Ruwitch is the trustee and 5,000 shares held by
a corporation controlled by Mr. Ruwitch. Does not include shares owned
individually by other members of his family, as to which shares he
disclaims any beneficial interest.
(9) Consists of 719 shares held in an individual retirement account.
* Mr. Lance B. Rosemore and Dr. Andrew S. Rosemore are the sons, and Dr.
Martha R. Greenberg is the daughter, of Dr. Fredric M. Rosemore. Dr. Andrew
S. Rosemore owns in excess of 5% of the shares of the Company.
Consequently, all such persons may be deemed to be "interested persons" as
defined under the Investment Company Act.
** Less than 1.0%
CERTAIN AFFILIATED TRANSACTIONS
A corporation controlled by certain of the executive officers and directors
of the Company owns the office building at 17290 Preston Road, Dallas, Texas, in
which the Company leases approximately 13,426 square feet of space. A
substantial portion of the Company's space under the lease (10,693 square feet)
was leased on November 23, 1991 and is currently rented at $187,226.20 per year.
The lease expires in 2006. Management believes that these terms are no less
favorable to the Company than those which the Company could obtain in an
unaffiliated transaction. On August 4, 1992, such lease was amended to allow the
Company to terminate such lease without the penalty upon 60 days written notice
to the landlord. The decision whether or not the Company will continue the lease
will be made by the Independent Directors Committee on an annual basis.
9
<PAGE> 12
PROPOSALS OF SHAREHOLDERS
Proposals of shareholders that are intended by such persons to be presented
at the 1999 Annual Meeting of Shareholders of the Company and to be included in
the Company's proxy statement and form of proxy relating to such meeting must be
received by the Company not later than December 18, 1998. Shareholder proposals
will be presented at the 1998 Annual Meeting of Shareholders only to the extent
that such proposals meet certain guidelines established under federal securities
laws. Proposals should be sent to Mr. Lance B. Rosemore, Secretary, 17290
Preston Road, 3rd Floor, Dallas, Texas 75252.
COSTS OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. The Company
may request banks, brokerage house and other custodians, nominees and
fiduciaries to forward copies of the proxy materials to beneficial holders of
the shares, or to request authority for the execution of the proxies, and the
Company may reimburse such banks, brokerage house and other custodians, nominees
and fiduciaries for their out-of-pocket expenses incurred in connection
therewith. In addition to solicitations by mail, officers of the Company may,
without extra remuneration, make supplementary solicitations of proxies
personally or by telephone, telegram or cable.
OTHER MATTERS
Management of the Company is not aware of any other matters to be presented
for action at the Annual Meeting; however, if any such matters are properly
presented for action, it is the intention of the persons named in the enclosed
form of proxy to act in accordance with their best judgment on such matters. It
is important that proxies be returned promptly to avoid unnecessary expense.
Shareholders are urged, regardless of their number of shares of Common Stock, to
date, sign and return the enclosed proxy. The Company's Annual Report to
Shareholders is being distributed along with this Proxy Statement. If you do not
receive a copy of the Annual Report, please contact the Company's Investor
Relations Department at (972) 349-3200 and one will be provided to you.
By Order of the Board of Directors
/s/ LANCE B. ROSEMORE
April 14, 1998 LANCE B. ROSEMORE
Secretary
10
<PAGE> 13
REVOCABLE PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
OF PMC CAPITAL, INC.
The undersigned hereby appoint(s) Barry N. Berlin and Jan F. Salit, or
either of them, with full power of substitution and resubstitution, proxies of
the undersigned, with all the powers that the undersigned would possess if
personally present, to cast all votes which the undersigned would be entitled
to cast at the Annual Meeting of Shareholders (the "Annual Meeting") of PMC
Capital, Inc. (the "Company") to be held on Thursday, May 14, 1998, at the
offices of the Company, 17290 Preston Road, 3rd Floor, Dallas, Texas,
commencing at 9:30 a.m., local time and any and all adjournments thereof,
including (without limiting the generality of the foregoing) to vote and act as
follows:
(CONTINUED, AND TO BE SIGNED, ON REVERSE SIDE)
<PAGE> 14
* Please Detach and Mail in the Envelope Provided *
- --------------------------------------------------------------------------------
Please mark your
[X] votes as
in this example.
1. ELECTION OF FOR the nominees WITHHOLD
DIRECTORS. listed at right AUTHORITY
(except as indicated to to vote for the
to contrary nominees listed at right
[ ] [ ]
NOMINEES: Dr. Irvin M. Borish
Mr. Thomas Hamill
Mr. Barry A. Imber
Instruction: To withhold authority to vote for any
individual nominee(s), write the name(s) here:
--------------------------------------------------
--------------------------------------------------
2. Proposal to ratify the appointment of Coopers & Lybrand L.L.P. as independent
public accountants for the Company for the fiscal year ending December 31, 1998.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
In their discretion, the proxies are authorized to vote upon such other business
as may properly come before the Annual Meeting.
THIS PROXY WILL BE VOTED AT THE ANNUAL MEETING OR ANY ADJOURNMENT THEREOF IN
ACCORDANCE WITH THE INSTRUCTIONS SET FORTH ABOVE OR, IN THE EVENT NO
INSTRUCTIONS ARE SET FORTH, THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES
FOR DIRECTOR AND FOR PROPOSAL 2. This proxy hereby revokes all prior proxies
given with respect to the shares of the undersigned.
Your Board of Directors unanimously recommends that you vote FOR each of
the nominees for director and FOR Proposal 2. Accordingly, please complete,
sign, date, and return this proxy in the envelope provided for such purposes. No
postage is required for mailing in the United States.
SIGNATURE(S) DATE , 1998
-------------------------------------------- -----------
IMPORTANT: Please date this proxy and sign exactly as your name appears above.
If shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give title as such. If a
corporation, please sign full corporate name by president or other authorized
officer. If a partnership, please sign in partnership name by authorized person.
