Notice of Annual Meeting of Shareholders
To Be Held on February 26, 1997
To the Shareholders:
The Annual Meeting of Shareholders of Elk Associates Funding Corporation
(the "Company") will be held at the offices of Stursberg & Veith, 405 Lexington
Avenue, Suite 4949, New York, New York on February 26, 1997 at 10:30 a.m. to
consider and act upon the following matters:
1. To elect eleven directors to serve until the next Annual Meeting and
until their successors are chosen and qualified.
2. To amend the Company's certificate of incorporation to allow the Company
to invest in or make loans to non-disadvantaged firms.
3. To ratify the selection by the Board of Directors of Marcum & Kliegman
LLP as the Company's independent public accountants for the fiscal year ending
June 30, 1997.
4. To consider and act upon such other matters as may properly come before
the meeting or any adjournment thereof.
Shareholders of record at the close of business on January 15, 1997 will be
entitled to notice of and to vote at the meeting. The stock transfer books of
the Company will remain open.
All shareholders are cordially invited to attend the meeting.
By Order of the Board of Directors
MARGARET CHANCE, Secretary
January 27, 1997
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE IN ORDER
TO ASSURE REPRESENTATION OF YOUR SHARES.
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Elk Associates Funding Corporation
747 Third Avenue - 4th Floor
New York, New York 10017
Proxy Statement for
Annual Meeting of Shareholders
February 26, 1997
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Elk Associates Funding Corporation (the
"Company") for use at the Annual Meeting of Shareholders to be held on February
26, 1997 and at any adjournment of that meeting. In considering whether or not
to have an adjournment, management will consider what is in the best interest of
the shareholders. All proxies will be voted as marked. Proxies marked as
abstaining (including proxies containing broker non-votes) on any matters to be
acted upon by shareholders will be treated as present at the meeting for
purposes of determining a quorum but will not be counted as votes cast on such
matters. Any proxy may be revoked by a shareholder at any time before it is
exercised by written or oral request to Margaret Chance, Secretary of the
Company. The date of mailing of this Proxy Statement is expected to be on or
about January 27, 1997.
The Board of Directors has fixed January 15, 1997 as the record date for
the determination of shareholders entitled to vote at the Annual Meeting. At the
close of business on January 15, 1997 there were outstanding and entitled to
vote 1,283,600 shares of common stock (the "Common Stock") of the Company. Each
share is entitled to one vote.
The following table sets forth information concerning ownership of the
Company's Common Stock as of January 15, 1997 by each person known by the
Company to be the beneficial owner of more than five (5%) percent of the Common
Stock.
Percent of
Common Stock Common Stock
Name and Address Beneficially Owned Outstanding
- ---------------- ------------------ -----------
Gary C. Granoff (1)(2) 237,446 (3)(4) 18.5%
c/o Elk Associates
Funding Corporation
747 Third Ave.
4th Floor
New York, New York
Paul D. Granoff, M.D. (1) 89,630 (5) 6.98%
132 North Buckingham Drive
Aurora, Illinois
N. Henry Granoff (1) 80,649 (3)(6) 6.28%
2000 South Ocean Blvd
Palm Beach, Florida
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Marvin Sabesan 72,145 (9) 5.62%
188 Gannet Court
Manhasset, New York
Dan M. Granoff, M.D. (1) 95,130 (3)(8) 7.41%
1085 Creston Road
Berkeley, California
Alexander Nash, M.D. 72,600 (7) 5.66%
12 Ridgeway
Kings Point, New York
- ------------------------
(1) N. Henry Granoff is the father of Gary C., Dan M. and Paul D. Granoff.
(2) Gary Granoff may be deemed a "control person" of the Company within the
meaning of the 1940 Act.
(3) Excludes 10,900 shares owned by a charitable foundation of which N. Henry
Granoff, his wife Jeannette Granoff, Gary C. Granoff and Dan M. Granoff are
the trustees.
(4) Includes 25,218 shares held in various trusts of which Mr. Granoff is a
trustee and 6,000 shares held for the benefit of one of Mr. Granoff's sons,
with respect to which he is custodian. With respect to these 31,218 shares,
Mr. Granoff disclaims beneficial ownership for purposes other than Rule
13d-3 of the Securities Exchange Act of 1934, as amended. Excludes 7,537
shares owned directly by Mr. Granoff's wife as to which shares he disclaims
beneficial ownership. Also excludes 19,466 shares owned directly by Mr.
Granoff's children as to which shares he does not exercise any control and
disclaims beneficial ownership. Includes 72,875 shares held by a
corporation controlled by Mr. Granoff and 261 shares held by a corporation,
wholly-owned by Mr. Granoff. Excludes 22,800 shares held by various trusts
for the benefit of Mr. Granoff's children, of which shares Mr. Granoff
disclaims beneficial ownership until such time as 21,000 of such shares
revert to him.
(5) Includes 2,000 shares held by Dr. Paul Granoff directly, 77,630 held by
Granoff Family Partners Ltd. of which Dr. Granoff is a general partner, and
10,000 shares held by the Granoff Pediatric Associates Profit Sharing Plan.
Excludes 10,127 shares held by Dr. Paul Granoff's wife as to which shares
he disclaims beneficial ownership. Excludes 9,654 shares owned directly by
Dr. Granoff's children as to which shares he does not exercise any control
and disclaims beneficial ownership.
(6) Excludes 33,499 shares owned by Mr. Granoff's wife, as to which shares Mr.
Granoff disclaims beneficial ownership. Mr. Granoff's shares are registered
in the N. Henry Granoff Revocable Trust dated May 19, 1987.
(7) Includes 1,500 shares held by Alexander Nash, M.D. as custodian for his
daughter. Also includes 42,900 shares held by his wife, as to which shares
Alexander Nash, M.D. disclaims beneficial ownership.
(8) Excludes 12,000 shares owned directly by Dr. Granoff's children as to which
shares he does not exercise any control and disclaims beneficial ownership.
(9) Includes 21,387 shares held with his wife as joint tenants, 2,207 shares
held with one of his children as joint tenants, and 28,551 shares held by
his wife. Mr. Sabesan disclaims beneficial ownership as to the 28,551
shares held by his wife.
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Except as otherwise indicated above, the persons listed in the above table
have voting and investment power with respect to their respective shares.
All of the persons listed above, for as long as they continue to hold five
(5%) percent or more of the Company's outstanding Common Stock, will be deemed
"affiliated persons" of the Company, as such term is defined in the 1940 Act.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The affirmative vote of the holders of a majority of the Common Stock
present or represented at the meeting is required for the election of directors.
The persons named in the proxy will vote, as permitted by the By-Laws of the
Company, to elect as directors the eleven nominees named below, unless authority
to vote for the election of directors is withheld by marking the proxy to that
effect or the proxy is marked with the names of directors as to whom authority
to vote is withheld. The proxy may not be voted for more than eleven directors.
Each director will be elected to hold office until the next annual meeting
of shareholders and until his or her successor is elected and qualified. If a
nominee becomes unavailable, the person acting under the proxy may vote the
proxy for the election of a substitute. It is not presently contemplated that
any of the nominees will be unavailable.
Two of the nominees for director will be completing and submitting
applicable documents to the U. S. Small Business Administration (the "SBA") for
approval of their becoming directors of the Company. Such approval would occur
within ninety days of submission of the documents. If the nominees are not
approved, the Board of Directors reserves the right to fill any vacancy
occurring therefrom.
The following sets forth the name of each nominee and the positions and
offices held by him or her, his or her age, the date on which he or she became a
director of the Company, his or her principal occupation and business experience
for the last five years, the names of other publicly-held companies in which he
or she serves as a director:
Gary C. Granoff, age 48, has been President and a director of the Company
since its formation in July 1979 and Chairman of the Board of Directors since
December 1995. Mr. Granoff has been a practicing attorney for the past
twenty-three years and is presently an officer in the law firm of Granoff,
Walker & Forlenza, P.C. Mr. Granoff is a member of the bar of the State of New
York and the State of Florida and is admitted to the United States District
Court of the Southern District of New York. Mr. Granoff is also President and
the sole stockholder of GCG Associates, Inc. ("GCG"), the Company's former
investment adviser. He has served as President and the sole stockholder of
Seacrest Associates, Inc., a hotel operator, since August 1994. Mr. Granoff has
also been President and a director since June 1996 of
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Gemini Capital Corporation ("Gemini"), a company primarily engaged in the
business of making consumer loans.
Ellen M. Walker, age 41, has been a Vice President and General Counsel of
the Company since July 1983 and a director of the Company from July 1983 to
August 1994. She again became a director of the Company in 1995. Ms. Walker has
been a practicing attorney for more than ten years and she is presently an
officer and shareholder in the law firm of Granoff, Walker & Forlenza, P.C. Ms.
Walker is a member of the Bar of the State of New York and she is admitted to
the United States District Court of the Southern District of New York. Since
August 1983 Ms. Walker has been Vice President of GCG. Ms. Walker has been a
director, Vice President and General Counsel of Gemini since June 1996.
Lee A. Forlenza, age 39, has been a Vice President of the Company since
March 1992. Mr. Forlenza has been a practicing attorney since February 1983 and
is presently an officer and shareholder in the law firm of Granoff, Walker &
Forlenza, P.C. Since March 1992 Mr. Forlenza has been an investment analyst for
GCG. Mr. Forlenza has also been Vice President, Secretary and a director of
Gemini since June 1996. Mr. Forlenza was Vice President of True Type Printing
Co., Inc. from 1976-1995 and President since May 1995. From 1983 through 1986
Mr. Forlenza was an attorney with the SBA.
Marvin Sabesan, age 69, has been a director of the Company since July 1982.
Mr. Sabesan has been employed by Pearl River Textiles, Inc. as an executive
since 1990. He was an Executive Vice President of N.O.L. Inc., a lingerie
company, from 1988 to 1990. Mr. Sabesan was an Executive Vice President of A.J.
Schneierson & Son, a clothing manufacturer from 1971 to 1987.
Herbert G. Kanarick, age 65, has been a director of the Company since
October 1994. Mr. Kanarick has been a partner of S. P. Cooper & Company, an
accounting firm since 1970. Mr. Kanarick serves as a peer reviewer for the
American Institute of Certified Public Accountants reviewing the quality of work
of other accounting firms. He is a trustee of the investment program for Long
Island Lutheran High School in Brookville, New York.
Steven Etra, age 48, has been Sales Manager since 1975 of Manufacturer's
Corrugated Box Company, a company owned by Mr. Etra's family for more than
seventy-five years. Mr. Etra has also been a director of Gemini since June 1996.
Steven R. Busch, age 51, has been a director of the Company since October
1994. Mr. Busch has been Chairman and Founder of B-H Investment Group, Inc.
since November 1996 and a Managing Partner of Van Eck Associates Inc. since May
1996. Previously, from 1989 to 1994, Mr. Busch was Executive Vice President of
Lehman Brothers, Inc. and the Senior Credit Officer of The Boston Safe Deposit
and Trust Company, a subsidiary of Lehman Brothers, Inc. From 1986 to 1989 Mr.
Busch was Vice President, Manager and head of the Mortgage Backed Securities
finance department of Security Pacific Merchant Bank. From 1963 to 1986, Mr.
Busch was a Vice President of JP Morgan and Co. In addition, Mr. Busch has
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been an independent director of Plaza Consulting Corp. since December 1996. From
January 1995 to April 1996, Mr. Busch was a director of Taj Mahal Holding
Corporation and TM/GP Corporation which corporations merged with Trump Hotels &
Casino Resorts, Inc. Mr. Busch has also been an advisor to the Permanent Mission
of Bosnia and Herzegovina to the United Nations since 1994.
Paul Creditor, age 61, has been a practicing attorney since 1961, engaging
in general practice law and specializing in corporate law. From 1974 through
1979 he served as an elected Judge in Suffolk County, New York.
Allen Kaplan, age 46, is Vice President and Chief Operating Officer of Team
Systems, Inc., a company which manages and operates more than 200 New York City
Medallion taxicabs. Mr. Kaplan is currently Vice President of the Metropolitan
Taxicab Board of Trade, a trade association consisting of 22 member fleets
representing 1,200 New York City medallions.
Dan M. Granoff, M.D., age 52, has been Vice President of Scientific Affairs
of Chiron Vaccines at Chiron Corporation since September 1993. From 1980 to
1993, Dr. Granoff was a professor of pediatrics and Head of the Infectious
Disease Division of Washington University Medical School in St. Louis, Missouri.
Prior to joining Chiron Corporation, Dr. Granoff was also a consultant to the
pharmaceutical industry and served on the scientific advisory board of Connaught
Laboratories, Inc., one of the largest suppliers of vaccines in the U.S. Dr.
Granoff received both his A.B. and M.D. degrees from Johns Hopkins University.
Alexander Nash, M.D., age 47, has been a practicing physician since 1979
and for the past 15 years an attending anesthesiologist at Franklin Hospital
Medical Center. He has acted as the sole proprietor of the Pain Management
Office since 1986, the first outpatient facility for the treatment of acute and
chronic pain in Western Nassau County, and President and Chief Executive Officer
of ABP IC, Inc., a medical supplies and equipment exporting company. In 1973 Dr.
Nash graduated from Moscow Medical School, and immigrated with his family to the
United States.
During the fiscal year ended June 30, 1996, the Company's Board of
Directors held four (4) meetings. Each director attended at least 75% of such
meetings.
The Company does not have standing audit or nominating committees. The
Company has an Audit and Compliance Committee consisting of Marvin Sabesan, Lee
A. Forlenza and Margaret Chance. The Company recently formed a compensation
committee.
The following is information regarding additional officers of the Company:
Margaret Chance, age 41, has been Secretary of the Company since November
1980. Ms. Chance is the office manager of Granoff, Walker & Forlenza, P.C. and
has served as the Secretary of GCG Associates Inc., since January 1982.
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Silvia Maria DiGirolamo, age 45, has been the Loan Administrator of the
Company since February 1994. She was elected a Vice President of the Company,
subject to SBA approval, at the meeting of the board of directors held on
December 11, 1996. Prior to joining the Company, she was the Legal Coordinator
for Castle Oil Corporation from September 1991 through June 1993 and from June
1993 through January 1994, a legal assistant specializing in foreclosures in the
law firm of Greenberg & Posner. Ms. DiGirolamo received a B.A. from Fordham
University and an M.B.A. from The Leonard Stern School of Business
Administration.
The following table sets forth information concerning ownership of the
Company's Common Stock as of January 15, 1997 by each existing director, nominee
to become a director and officer of the Company and by all directors and
officers of the Company as a group.
Percent of
Common Stock Common Stock
Name Beneficially Owned Outstanding
- ---- ------------------ -----------
*Gary C. Granoff(1) 237,44 (1) 18.5%
*Ellen M. Walker 31,374(2) 2.44%
*Lee A. Forlenza 18,505 1.44%
*Margaret Chance 2,900(3) (5)
*Silvia DiGirolamo None
Marvin Sabesan 72,145(4) 5.62%
Herbert G. Kanarick 44,205(6) 3.44%
Steven Etra 52,516(7) 4.09%
Steven R. Busch 2,000(8) (5)
Paul Creditor None
Allen Kaplan 5,000 (5)
Dan M. Granoff 95,130(9) 7.4%
Alexander Nash 72,600(10) 5.7%
------- -------
Officers and Directors 633,821 49.4%
of the Company as a
group (11 persons)
- ----------
* Messrs. Gary C. Granoff, Ms. Ellen Walker, Mr. Lee A. Forlenza, Ms.
Margaret Chance and Ms. Silvia DiGirolamo are each "interested persons"
with respect to the Company, as such term is defined in the 1940 Act.
(1) Gary C. Granoff, see Notes (3) and (4) on page 2.
(2) Includes 200 shares held by Ms. Walker as custodian for her son. Includes
22,800 shares held by various trusts of which Ms. Walker is a trustee and
as to which she disclaims beneficial ownership.
(3) Includes 200 shares held by Ms. Chance as custodian for her daughter.
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(4) Includes 21,387 shares held by Mr. Sabesan and his wife as joint tenants,
2,207 shares held with one of his children as joint tenants, and 28,551
shares held by his wife. Mr. Sabesan disclaims beneficial ownership as to
the 28,551 shares held by his wife.
(5) Less than one (1%) percent.
(6) Includes 200 shares held by Mr. Kanarick's wife, as to which shares he
disclaims beneficial ownership. Includes 44,005 shares owned by J. R.
Realty Corporation, a subsidiary of Murres Corporation, a majority of the
shares of which are owned by a trust of which Mr. Kanarick is the sole
trustee.
(7) Includes 29,022 shares held with his wife as joint tenants and 20,000
shares held by his wife.
(8) Includes 1,000 shares held by Mr. Busch's wife.
(9) Dan M. Granoff, M.D., see Notes (1), (3) and (8) on page 2.
(10) Alexander Nash, M.D., see Note (7) on page 2.
Effective May 1, 1991, the Securities and Exchange Commission promulgated
new rules under Section 16 of the Securities Exchange Act of 1934. The Company
believes that during the preceding year its executive officers and directors
have complied with all Section 16 filings.
Executive Compensation
The following table sets forth all remuneration for services rendered to
the Company during the year ended June 30, 1996 paid to or accrued for the
account of (i) each of the executive officers and (ii) all executive officers as
a group.
For the period July 1, 1995 through December 31, 1995 the Company paid GCG
an aggregate of $210,000 for management services rendered to the Company. The
Company also paid to Granoff, Walker & Forlenza, P.C. ("GWF") a monthly legal
retainer for performing New York City taxi loan closings which retainer was paid
at the rate of $9,000 per month and constituted $54,000 for the first six months
of the fiscal year. This retainer ended on December 31, 1995. GWF was paid an
additional $48,902 for collection services, litigation of collection of
defaulted loans and certain non-taxi related closings. Finally, $12,047 was paid
to GWF for disbursements or reimbursements of shared costs for office equipment.
Commencing January 1, 1996 and thereafter, the Company has agreed to pay
GWF a monthly reimbursement of $7,250 for shared costs consisting of $3,333.33
for shared rent per month and $3,916.67 for shared employee costs for GWF
employee secretarial, photocopy, banking and receptionist services.
From January 1, 1996 through June 30, 1996 the Company changed from
utilizing the services of GCG to a direct salary basis for the investment
advisor services of its officers and
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employees. The following individuals were paid the cash compensation set forth
opposite their names for the period January 1, 1996 through June 30, 1996:
Name of Individual
or Number of Persons Capacities in
in Group Which Served Cash Compensation(1)
-------------- ------------ --------------------
Gary C. Granoff President $90,797 plus simplified employee
pension plan ("SEP")
contributions of
$13,127 and $7,500 of
reimbursable expenses.
Ellen M. Walker Vice President $39,787 plus $5,625 in SEP
Counsel contributions.
Lee A. Forlenza Vice President $12,019 plus $1,803 in SEP
contributions.
Silvia DiGirolamo Vice President $24,038 plus $3,608 in SEP
contributions.
Margaret Chance Secretary $2,600 plus $390 in SEP
contributions.
All executive officers as
a group (5) persons $201,294
- ----------
(1) Officers' salaries constitute a major portion of the Company's total
"management fee compensation" which must be approved by the SBA. The SBA has
approved total officer and employee compensation of $648,000 for the Company.
This amount includes officers' salaries, other salaries and employee benefits.
For the period July 1, 1996 through June 30, 1997, the Company anticipates
paying cash compensation, excluding future bonuses that may be granted by the
Company's Board of Directors, as follows:
Gary C. Granoff $205,000 plus $15,000 reimbursable expense and
$22,500 in SEP contributions.
Ellen M. Walker $94,000 plus $14,100 in SEP contributions.
Lee A. Forlenza $35,000 plus $5,250 in SEP contributions.
Silvia DiGirolamo $55,500 plus $8,350 in SEP contributions.
Margaret Chance $49,000 plus $7,350 in SEP contributions.
All executive offices as
a group (5) persons $511,050
The Company has a policy of paying its directors who are not employees fees
of $750 for each meeting attended. Commencing July 1, 1996 the Company will in
addition, pay each non-affiliated director a minimum fee of $2,000 per year in
addition to the fees paid for each meeting attended. For the year ended June 30,
1996, fees and expenses paid to non-affiliated directors were approximately
$23,400 in the aggregate.
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PROPOSAL NO. 2
AMENDMENT TO COMPANY'S CERTIFICATE OF INCORPORATION
On September 30, 1996, the Small Business Programs Improvement Act (the
"Improvement Act") was enacted. The Improvement Act repealed Section 301(d) of
the Small Business Investment Company Act of 1958 (the "1958 Act") which was the
section of the 1958 Act under which the Company was originally licensed as an
SSBIC. The effect of the Improvement Act is that an SSBIC licensee like the
Company may, subject to SBA approval of an amendment to the licensee's articles
of incorporation, make investments in or loans to firms other than
"disadvantaged businesses" as defined by Sec. 107.50 of applicable SBA
Regulation. The proposed amendment is attached hereto as Exhibit A. Because
Congress did not prescribe how Sec. 301(d) licensees like the Company might
operate in the future if they amended their articles of incorporation, the SBA
is in the process of developing regulations as to the guidelines a licensee like
the Company must follow if it desires to make investments in and loans to
non-disadvantaged firms. In this regard, the SBA has advised the Company that
the Company must enter into an agreement with the SBA prior to obtaining SBA
approval to the amendment to the articles of incorporation which will provide
among other things that prior to the Company making any non-301(d) investments
that the Company have in its portfolio 301(d) investments with an aggregate cost
at least equal to the sum of the Company's outstanding subsidized leverage,
liquidating interest held by the SBA as a result of the preferred stock buy back
and unamortized dividends,if any. As of November 30, 1996, the Company had
$1,500,000 of outstanding subsidized leverage and $2,094,833 liquidating
interest. The Company had no unamortized dividends. If the amendment to the
Company's certificate of incorporation in the form attached hereto as Exhibit A,
is approved by shareholders and by the SBA, the Company would be able to make a
significant amount of new investments in non-disadvantaged firms, assuming
$3,594,833 in the aggregate of outstanding subsidized leverage and liquidating
interest, is retained in qualifying loans. This amount will diminish at the rate
of $59,287 per month assuming that the SBA's liquidating interest continues to
amortize. The $1,500,000 debenture will be considered unsubsidized in October
1998.
Because the Company's management believes that it would be in the best
interests of the Company to amend its articles of incorporation to provide that
the Company may invest in other than disadvantaged firms, the Company proposes
to amend its articles of incorporation, subject to shareholder approval and to
SBA approval.
The Company's Board of Directors recommends a vote FOR Proposal No. 2.
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PROPOSAL NO. 3
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors, including a majority of Directors who are not
interested persons of the Company, subject to shareholder approval, has selected
Marcum & Kliegman LLP as independent public accountants to be employed by the
Company for the fiscal year ended June 30, 1997 to sign or certify such
financial statements, or any portions thereof, as may be filed by the Company
with the Securities and Exchange Commission or any other authorities at any
time. The employment of such independent public accountants for such purpose is
subject to ratification by the shareholders at this meeting. No member of Marcum
& Kliegman LLP or any associate thereof has a direct or indirect material
financial interest in the Company or any of its affiliates.
The Board of Directors has chosen to utilize the firm of Marcum & Kliegman
LLP and to discontinue utilizing Deloitte & Touche LLP due to considerable
savings that the Company will obtain. These savings result from the Company
having taken recent steps to generate all of its own accounting data and thereby
allowing it to be able to conduct this aspect of its business operation without
the use of the CPA firm of Tanton and Company LLP which previously acted as the
Company's controller and which rendered bookkeeping services. In addition,
Tanton and Company LLP recently merged into Marcum & Kliegman LLP, and the
combined firm has eight partners and a total professional staff of 90, making it
one of the top 100 accounting firms in the United States. The Company expects to
save approximately $30,000 per year in its total accounting fees as a result of
generating its own accounting data, and by changing audit firms from Deloitte &
Touche LLP to Marcum & Kliegman LLP.
The affirmative vote of a majority of the Common Stock present or
represented at the meeting is required to ratify the selection of Marcum &
Kliegman LLP as independent public accountants for the Company.
A representative of Marcum & Kliegman LLP will not be present at the Annual
Meeting of Shareholders.
The Board of Directors of the Company recommends a vote FOR Proposal No. 3.
OTHER MATTERS
The Board of Directors does not know of any other matters which may come
before the meeting. However, if any other matters are properly presented to the
meeting, it is the intention of the persons named in the accompanying proxy to
vote, or otherwise to act, in accordance with their judgment on such matters.
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All costs of solicitation of proxies will be borne by the Company. In
addition to solicitations by mail, the Company's directors, officers and regular
employees, without additional remuneration, may solicit proxies by telephone and
personal interview.
Deadline for Submission of Shareholder Proposals
Proposals of shareholders intended to be presented at the 1997 Annual
Meeting of Shareholders must be received by the Company at its principal
executive offices not later than September 22, 1997 for consideration for
inclusion in the proxy statement for that meeting. Further, all shareholder
proposals must meet certain federal securities law requirements before they will
be included in the Company's 1997 proxy statement.
Requests for Financial Statements
The Company will furnish, without charge, a copy of its financial
statements for the fiscal year ended June 30, 1996 to shareholders who make
written request to the Company at 747 Third Avenue, 4th Floor, New York, NY
10017 or call the Company collect at (212) 355- 2449.
The Board of Directors invites shareholders to attend the Annual Meeting.
Whether or not you plan to attend, you are urged to complete, date, sign and
return the enclosed proxy in the accompanying envelope. Prompt response will
greatly facilitate arrangements for the meeting, and your cooperation will be
appreciated. Shareholders who attend the meeting may vote their stock personally
even though they have sent in their proxies.
By Order of the Board of Directors
MARGARET CHANCE, Secretary
January 27, 1997
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PROXY FOR HOLDERS OF COMMON STOCK
Elk Associates Funding Corporation
The undersigned Common Shareholder of Elk Associates Funding Corporation
(the "Company") hereby constitutes and appoints Gary C. Granoff, Ellen M. Walker
and Margaret Chance, and each of them, singly, proxies and attorneys of the
undersigned, with full power of substitution to each, for and in the name of the
undersigned to vote and act upon all matters (unless and except as expressly
limited below) at the Annual Meeting of Shareholders of the Company to be held
on February 26, 1997 at the offices of Stursberg & Veith, 405 Lexington Avenue -
Suite 4949, New York, New York, at 10:30 a.m., and at any and all adjournments
thereof, in respect of all Common Stock of the Company held by the undersigned
or in respect of which the undersigned would be entitled to vote or act, with
all the powers the undersigned would possess if personally present. All proxies
heretofore given by the undersigned in respect of said meeting are hereby
revoked.
PROPOSAL 1. To Elect Directors
FOR electing all nominees listed (as recommended in the
proxy statement) except as marked below _______
Gary C. Granoff, Ellen M. Walker, Lee A. Forlenza, Marvin
Sabesan, Herbert Kanarick, Steven Etra, Steven R. Busch,
Paul Creditor, Allen Kaplan, Dan M. Granoff and Alexander
Nash.
WITHHOLD AUTHORITY to vote for all nominees listed ______
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that person's name in the space provided.)
- -----------------------------------------------------------------
PROPOSAL 2. To approve an amendment to the Company's certificate of
incorporation.
____FOR ____AGAINST ____ABSTAIN
(continued and to be signed on reverse side)
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PROPOSAL 3. To ratify the appointment of Marcum & Kliegman LLP as
independent public accountants for the fiscal year ended
June 30, 1997.
____FOR ____AGAINST ____ABSTAIN
PROPOSAL 4. To consider such other matters as may properly come before
the meeting.
____FOR ____AGAINST ____ABSTAIN
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Specify desired action by checkmarks in the appropriate spaces. The Proxy will
be voted as specified. If no specification is made, the Proxy will be voted for
the nominees named in the Proxy Statement to represent the Common Shareholders
and in favor of Proposals 2, 3 and 4. The persons named proxies have
discretionary authority, which they intend to exercise in favor of the proposals
referred to and according to their best judgment as to other matters which
properly come before the meeting.
PLEASE COMPLETE, SIGN, DATE AND RETURN THIS PROXY IN THE ENCLOSED
ENVELOPE AS SOON AS POSSIBLE.
Dated:__________________________
--------------------------------
(Signature of Shareholder)
--------------------------------
(Signature of Shareholder)
The signature(s) on this Proxy
should correspond exactly with the
shareholder's name as stencilled
hereon. In the case of joint
tenants, co-executors or
co-trustees, both should sign.
Person(s) signing as Attorney,
Executor, Administrator, Trustee or
Guardian should provide full title.
-13-
<PAGE>
Exhibit A
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
ELK ASSOCIATES FUNDING CORPORATION
Under Section 805 of the Business Corporation Law
It is hereby certified that:
FIRST: The name of the Corporation is ELK ASSOCIATES FUNDING CORPORATION.
SECOND: The Certificate of Incorporation of the corporation was filed by
the Department of State on July 9, 1979, under the name of Elk Associates
Funding Corporation.
THIRD: The Certificate of Incorporation of Elk Associates Funding
Corporation is hereby amended deleting subparagraph (a) of Article "THIRD" of
the Certificate of Incorporation of the corporation in its entirety and
substituting a new subparagraph (a) to read as follows: "(a) To operate under
the name set forth in FIRST above and to operate solely as a small business
investment company qualified under the Act to engage in such business activities
as the Small Business Administration shall permit by applicable regulation or
approval."
FOURTH: The amendment to Article "THIRD" of the Certificate of
Incorporation of the corporation was authorized by the Board of Directors of the
corporation and, subsequently by the affirmative vote of the holders of a
majority of the outstanding shares of the corporation entitled to vote on the
said amendment to
<PAGE>
the Certificate of Incorporation and, pursuant to the provisions of Article
SIXTH of the Certificate of Incorporation, by the United States Small Business
Administration.
IN WITNESS WHEREOF, this Certificate of Amendment to the Certificate of
Incorporation has been subscribed to this ____ day of______________ , 1997 by
the undersigned who affirm that the statements made herein are true under the
penalties of perjury.
2
GARY C. GRANOFF, PRESIDENT
MARGARET CHANCE, SECRETARY
