SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material pursuant to Rule 14a-11(c) or Rule 14a-12
PAYCHEX, INC.
- -----------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
PAYCHEX, INC.
- -----------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: _/
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
Set forth the amount of which the filing fee is calculated and state
how it was determined.
[ ] 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>
PAYCHEX
PAYCHEX, INC.
911 Panorama Trail South
Rochester, New York 14625
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS
To Be Held on October 3, 1996
To the Stockholders:
The Annual Meeting of Stockholders of Paychex, Inc. will be held at
the Geva Theatre, 75 Woodbury Blvd, Rochester, New York on Thursday, October
3, 1996. A continental breakfast will be available from 9:00 a.m. to 10:00
a.m. The Annual Meeting will begin at 10:00 a.m. for the following purposes:
1. To elect eight directors; and
2. To transact such other business as may properly come before
the meeting or any adjournment thereof.
The Board of Directors of the Company has fixed the close of business
on August 5, 1996 as the record date for the determination of stockholders
entitled to notice of, and to vote at, the meeting.
It is important that all shares be represented at the meeting. The
Board of Directors extends a cordial invitation to all stockholders to attend
the meeting. However, if you are unable to attend the meeting, you are
requested to sign, date and return the enclosed Proxy in the return envelope.
You may revoke your Proxy and vote in person if you decide to attend the
meeting.
BY ORDER OF THE BOARD OF DIRECTORS
G. Thomas Clark, Secretary
Rochester, New York
August 9, 1996
<PAGE>
PROXY STATEMENT
The Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Paychex, Inc. (Company) to be used
at the Annual Meeting of Stockholders of the Company to be held on Thursday,
October 3, 1996, at 10:00 a.m. for the purposes set forth in the foregoing
Notice of Annual Meeting. The cost of this solicitation will be borne by the
Company. The Board of Directors has fixed the close of business on August 5,
1996 as the record date for determining the holders of common stock entitled
to notice of, and to vote at, the meeting. The Company had outstanding on
that date 68,719,536 shares of common stock, each of which is entitled to one
vote. A majority of the outstanding shares (34,359,769 shares) present in
person or by proxy will constitute a quorum.
If the enclosed Proxy is properly executed and returned, the shares
represented will be voted by the proxies in accordance with the stockholder,s
directions. If the Proxy is signed and returned without choices having been
specified, the shares will be voted FOR the eight nominees described below.
The Proxy may be revoked by the person giving it at any time prior to its use
by a written revocation, submission of a later dated Proxy, or in person at
the meeting.
The Proxy Statement and Proxy are being mailed to stockholders on or
about August 9, 1996.
With regard to the election of directors, votes may be cast for
nominees or withheld; votes that are withheld will be excluded entirely from
the vote and will have no effect. Abstention may not be specified on
proposals relating to the election of directors. Under applicable Delaware
law, a broker non-vote will have no effect on the outcome of the election of
directors.
All applicable information provided in this Proxy Statement has been
restated to reflect the May, 1996 three-for-two stock split.
PROPOSAL 1 - ELECTION OF DIRECTORS
Eight directors are to be elected to the Board of Directors. The
Board of Directors has nominated the persons listed below for election.
If elected, each nominee will hold office until the Annual Meeting to
be held in 1997 and until his successor is elected and shall qualify.
The Board of Directors recommends the election of the eight nominees
listed below and it is intended that the proxies named (unless otherwise
directed) will vote the Proxy FOR the election of these nominees. Although
the Board of Directors believes that all of the nominees will be available to
serve, the proxies may exercise discretionary authority to vote for
substitutes proposed by the Board of Directors of the Company. However, the
enclosed Proxy cannot be voted for more than eight nominees.
NOMINEES FOR ELECTION
The following table sets forth certain information as of June 30,
1996, with respect to the nominees for election as directors of the Company,
none of whom is related to any other nominee or executive officer. Under the
<PAGE>
rules of the Securities and Exchange Commission, beneficial ownership is
deemed to include shares for which the individual, directly or indirectly,
has or shares voting or investment power, whether or not they are held for
the individual's benefit.
<PAGE>
<TABLE>
<CAPTION> Amount &
Nature of
Principal Served as Beneficial Percentage
Occupation Director Ownership Common
Name of Nominee Age Since Common Stock Stock
(1) (2)
<S> <C> <C> <C> <C> <C>
B. Thomas Golisano 54 Chairman, President & 1979 8,455,669 12.2
Chief Executive Officer
G. Thomas Clark 58 Sr. Vice President of 1980 284,282 (4)
Finance, Secretary &
Treasurer (3)
Donald W. Brinckman 65 Chairman and Founder 1990 37,500 (4)
of Safety-Kleen Corp. (5)
Steven D. Brooks 45 Private Investor 1995 -0- (4)
Phillip Horsley 57 President of Horsley 1982 96,245 (4)
Bridges Partners, Inc.,
private equity investors
Grant M. Inman 54 Partner of Inman & Bowman, 1983 137,888 (4)
venture capital investment
partnership (7)
Harry P. Messina, Jr. 63 Partner of Woods, Oviatt 1985 120,786 (4)
Gilman, Sturman & Clarke
LLP, Attorneys
J. Robert Sebo 60 Director (8) 1979 1,325,309 1.9
</TABLE>
<PAGE>
(1) Included in this column are the following shares with respect
to which nominees have or share voting or investment power
(including shares directly owned by certain relatives with
whom they are presumed to share voting and/or investment
power), and as to which the nominees disclaim beneficial
ownership: Mr. Golisano-55,068 shares owned by a foundation
of which he and Mr. Clark are trustees; Mr. Clark-111,448
shares, including the same foundation shares; Mr.
Horsley-2,598 shares; Mr. Inman-2,025 shares; Mr.
Messina-48,360 shares and Mr. Sebo-3,349 shares.
(2) This column also includes the following shares which may be
acquired within 60 days by exercise of options: Mr.
Clark-117,190 shares; Mr. Horsley-23,625 shares; Mr.
Inman-48,938 shares; Mr. Messina-23,625 shares.
(3) Mr. Clark is also a director of Magnetic Technologies
Corporation.
(4) Percentage is less than 1%.
(5) Mr. Brinckman is also a director of Johnson Worldwide
Associates, Inc. and Snap-on Tools Corporation.
(6) Mr. Brooks is also a director of Quick Response Service, Inc.
and Veritas Software Corp.
(7) Mr. Inman is also a director of Lam Research Corporation and
Insite Vision, Inc.
(8) Mr. Sebo retired as Vice President, Director of Eastern
Operations in December, 1994.
<PAGE>
COMPLIANCE WITH SECTION 16 (a) OF SECURITIES EXCHANGE ACT OF 1934
Section 16 (a) of the Securities Exchange Act of 1934 (the Exchange
Act) requires directors, officers and beneficial owners of more than 10% of
the Company's common stock to file with the Securities and Exchange
Commission reports of transactions in the stock. Because of the complexity
of the rules, the Company agreed to assume the responsibility for timely
filing such reports for those reporting persons who so requested and who
agreed to advise the Company promptly of changes in the ownership of the
Company's equity securities.
The Company believes that during the fiscal year ended May 31, 1996,
Section 16 (a) filing requirements applicable to its executive officers,
directors and greater than ten percent beneficial owners were complied with,
except through oversight, the initial report on Form 3 for Steven D. Brooks
and one Form 4 transaction by G. Thomas Clark and Eugene Polisseni were filed
late by the Company. As was reported on Eugene Polisseni's Form 4, a sale of
shares inadvertently occurred within six months of purchase. The small
profit realized was promptly returned to the Company.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company met four times during the
fiscal year ended May 31, 1996 (fiscal 1996).
The Executive Committee is comprised of Messrs. Golisano, Clark and
Horsley and may exercise all the powers and authority of the Board of
Directors in the management of the business and affairs of the Company except
as limited by law. There were four meetings of the Executive Committee
during fiscal 1996.
The Audit Committee is comprised of Messrs. Brinckman, Brooks, Inman
and Messina. It is responsible for evaluating and approving the services
performed by the Company's independent accountants as well as reviewing and
evaluating the Company's accounting practices and internal controls. The
Audit Committee met twice during fiscal 1996.
The Compensation Committee is comprised of Messrs. Brinckman,
Horsley, Inman and Sebo. It met once during fiscal 1996. The Committee
makes recommendations with respect to amount of officers salaries and grants
stock options to key employees.
The Directors' Option Committee was established for the sole purpose
of considering the grant of stock options to non-employee directors under
the Company's 1995 Stock Incentive Plan. Messrs. Golisano and Clark comprise
this Committee. The Directors' Option Committee held one meeting during
fiscal 1996.
No director attended fewer than 75% of all meetings of the Board of
Directors held during fiscal 1996 or of all meetings of any committee upon
which such director served during fiscal 1996.
Non-employee directors are paid $6,000 annually plus $1,000 for each
Board meeting and $500 for each committee meeting attended. On January 11,
1996, Mr. Brooks was awarded a non-qualified stock option under the Paychex,
Inc. 1995 Stock Incentive Plan to purchase 15,000 shares at $33.92 per share,
the market price on the day of grant. The options extend for 10 years and
are exercisable to the extent of 1/3 each year, commencing after the end of
two years.
<PAGE>
OTHER EXECUTIVE OFFICERS
John Carlen, 49, joined the Company in August, 1993 and was elected
Executive Vice President in October, 1993. Prior thereto (1981-1993), Mr.
Carlen served in various executive positions with the May Department Store
Company.
Walter Turek, 44, has served as Vice President, Sales since April
1989. Mr. Turek has been with the Company since 1979 and has served in
various sales management capacities.
Edmund Russo, 59, was elected Vice President, Director of Western
Operations in April 1989 and Vice President, Director of Operations in
October, 1994. Mr. Russo joined the Company in January, 1987 and prior to
being elected Vice President, served as a Regional Manager.
Eugene Polisseni, 56, has served as Vice President, Marketing since
April, 1989. Mr. Polisseni has been with the Company since its formation in
1979 and during that period served in various capacities.
Daniel Canzano, 42, was elected Vice President, Information Technology
in April, 1993. Mr. Canzano has been with the Company since 1989 and has
served as a Zone Sales Manager and Director of Information Technology.
Diane Rambo, 45, was elected Vice President, Electronic Network
Services in October, 1994. Ms. Rambo has been with the Company since August,
1980 and has served as Director of Electronic Network Services and as a Branch
Manager.
William Kuchta, 49, joined the Company in February, 1995 and was
elected Vice President, Organizational Development in April, 1996. Prior to
joining the Company (1993 to 1995), Mr. Kuchta was principal of his own
consulting firm and served as Vice President of Human Resources of Fisons
Corporation from 1989 to 1993.
REPORT OF THE COMPENSATION COMMITTEE
Compensation of Chief Executive Officer
The Compensation Committee recommends to the Board of Directors the
compensation to be paid to the Chief Executive Officer (CEO). In
performing that function, the Committee reviews the range and components of
compensation paid to CEO's of other public companies. In particular, the
Committee looks to those public companies whose size and performance with
respect to revenue, earnings per share and stock price are similar to those
of Paychex.
Mr. Golisano's substantial stock position in the Company assures the
Committee of his close identification with the interests of its stockholders.
His compensation has been limited to his salary and participation in the
Officer Incentive Program discussion below. Each recommended adjustment is
reflective in part of the Committee's evaluation of the Company's performance
in the three areas discussed above as well as other areas. Adjustments also
reflect the Committee's opinion of the impact, both short-and long-term, which
Mr. Golisano's creativity, strategic focus and leadership had on these and
other factors.
<PAGE>
Mr. Golisano's 1996 compensation (including base salary and bonus
under the Officer Incentive Program) was 7.3% over that in 1995. Base
compensation was based in part on the Company's performance during fiscal
1996 during which the Company's revenue increased 22%, dividends paid
increased 47%, earnings per share increased 33%, and its stock price
increased 124%, over the prior year's figures.
COMPENSATION OF OTHER EXECUTIVE OFFICERS
Recommended compensation for senior executives other than the CEO is
determined by the Compensation Committee after the CEO provides the Committee
with his evaluation of the performance of each senior officer and his
recommendation with respect to salary, bonus and stock options. Committee
members discuss his recommendations in light of their own experiences and
familiarity with levels and components of compensation for persons with
similar responsibilities in other public companies. The goal of the
Committee is to compensate fairly for the job done, to reward extraordinary
performance or promise and to encourage long-term identification with
stockholder interest through award of stock options under the Company's Stock
Incentive Plan. Company performance is also considered.
The Compensation Committee's recommendations are presented to the
Board for discussion and decision. An officer-director whose compensation is
being considered is excused from that portion of the meeting. In fiscal
1996, all recommendations of the Committee were approved by the Board. Base
salary changes are prospective and are made following the annual
stockholders' meeting in October. Thus, salary adjustments and stock option
grants are made four to five months after the Company's fiscal year end in
May.
The Compensation Committee and the Board have instituted an Officer
Incentive Program whereby a portion of the compensation of senior executive
officers (including the CEO) is incentive-based and dependent upon the
Company's performance. The performance factor (currently earnings per
share), minimum, target and maximum levels, and bonus percentage of base
compensation, are established for the new year within 45 days after the end
of the prior fiscal year.
Impact of Section 162(m) of the Internal Revenue Code
Section 162(m) of the Internal Revenue Code generally limits the tax
deductibility of annual compensation paid to certain executive officers to $1
million, unless specified requirements are met. The Compensation Committee
has carefully considered the impact of this provision in the Tax Law. At
this time, it is the Committee's intention to continue to compensate all
officers based on overall performance. The Committee expects that most, if
not all compensation paid to officers will qualify as a tax deductible
expense. However, it is possible that at some point in the future,
circumstances may cause the Committee to authorize compensation that is not
deductible.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee consists of Donald W. Brinckman, Phillip
Horsley, Grant M. Inman and J. Robert Sebo. All members of the Compensation
Committee are non-employees of the Company. None of the Company's executive
officers serves on the board of any other entity which employs a member of
the Compensation Committee.
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth all compensation received by the
Company's Chief Executive Officer and the Company's other most highly
compensated Executive Officers during the last three fiscal years.
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
Number of
Shares All
Underlying Other
Name & Principal Options Compen-
Position Year Salary (1) Bonus (1) Granted sation (2)
<S> <C> <C> <C> <C> <C>
B. Thomas Golisano 1996 $465,625 $71,250 0 $ 4,797
Chairman, President, 1995 $440,625 $59,850 0 $ 4,153
and Chief Executive 1994 $411,875 $26,000 0 $ 4,107
Officer
John T. Carlen 1996 $269,375 $41,250 22,500 $ 4,185
Executive Vice 1995 $246,875 $34,580 45,000 $ 3,686
President 1994 $175,000 $0 33,750 $ 35,994
G. Thomas Clark 1996 $249,375 $38,250 0 $ 5,199
Secretary, 1995 $234,375 $31,920 0 $ 5,177
Treasurer, and Senior 1994 $217,875 $0 22,500 $ 5,078
Vice President of
Finance
Edmund S. Russo 1996 $221,250 $33,750 10,500 $ 5,081
Vice President, 1995 $201,875 $28,595 22,500 $ 5,390
Director of Operations 1994 $174,750 $0 13,500 $ 4,948
Walter Turek 1996 $199,375 $59,500 10,500 $ 4,180
Vice President, 1995 $183,625 $63,452 13,500 $ 2,967
Sales 1994 $170,000 $54,000 13,500 $ 3,954
</TABLE>
(1) Represents compensation earned.
(2) Represents Company contributions to the Paychex 401(k) Incentive
Retirement Plan as well as premiums paid by the Company for group
term life insurance. Amounts in 1994 for Mr. Carlen include payments
for relocation allowances of $35,721 made by the Company in
connection with his relocation to the Corporate Office in Rochester,
New York.
<PAGE>
1996 OPTION GRANTS TABLE
The following table sets forth stock options granted to the Company's
Chief Executive Officer and the Company's other most highly
compensated Executive Officers during 1996. Under Securities and
Exchange Commission ("SEC") regulations, companies are required to
project an estimate of appreciation of the underlying shares of stock
during the option term. The Company has chosen the 5% - 10% formula
approved by the SEC. However, the ultimate value will depend on the
market value of the Company stock at a future date, which may or may
not correspond to the projections below.
<TABLE>
<CAPTION>
Potential Realizable
Individual Grants Value at Assumed
Number of % of Total Annual Rates of
Shares Options Stock Price
Underlying Granted to Exercise Appreciation
Options Employees Price Per Expiration for Option Term (2)
Name Granted (1) In 1996 Share Date 5% 10%
<S> <C> <C> <C> <C> <C> <C>
B. Thomas Golisano -0- -0-% $ -0- $ 0 $ 0
John T. Carlen 22,500 4.67% $ 30.25 10/5/05 $428,041 $1,084,741
G. Thomas Clark -0- -0-% $ -0- $ 0 $ 0
Edmund S. Russo 10,500 2.18% $ 30.25 10/5/05 $199,753 $ 506,212
Walter Turek 10,500 2.18% $ 30.25 10/5/05 $199,753 $ 506,212
</TABLE>
(1) Options were granted from the Paychex, Inc. 1995 Stock Incentive
Plan established for Directors, Officers and key employees.
Options are granted at prices not less than 100% of the fair
market value of the common stock at the date of grant, unless the
grant is under Section 422A of the Internal Revenue Code, in which
case if the employee owns more than 10% of the outstanding common
stock, the option price must be not less than 110% of the fair
market value. The options granted are exercisable in cumulative
annual installments of 33 1/3% after two years and expire ten (10)
years from the date of grant.
(2) Represents realizable values net of the option exercise price but
before any income taxes that the executives may have to pay. The
dollar amounts under these columns are the result of calculations
at the 5% and 10% rates (determined from the price at the date of
grant, net the stock's current market value) set by the Securities
and Exchange Commission and therefore are not intended to forecast
possible future appreciation, if any, of the Company's stock
price.
<PAGE>
AGGREGATED OPTION EXERCISES IN THE LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION VALUES
The following table sets forth stock options exercised by the
Company's Chief Executive Officer and the Company's other most highly
compensated Executive Officers during 1996, and the number and value
of all unexercised options at year-end. The value of "in-the-money"
options refers to options having an exercise price which is less than
the market price of the Company's stock on May 31, 1996.
<TABLE>
<CAPTION>
Number
of Shares
Underlying Value of Unexercised
Number Unexercised In-The-Money
of Shares Net Options at Options at
Acquired Value May 31, 1996 May 31, 1996 (2)
On Real- Exer- Unexer- Exer- Unexer-
Name Exercise ized (1) cisable cisable cisable cisable
<S> <C> <C> <C> <C> <C> <C>
B. Thomas Golisano -0- $ -0- -0- -0- $ -0- $ -0-
John T. Carlen -0- $ -0- 11,250 90,000 $ 328,750 $2,231,874
G. Thomas Clark 101,250 $3,090,538 117,190 15,000 $4,436,452 $ 438,333
Edmund Russo 101,250 $3,954,689 50,063 55,500 $1,825,019 $1,518,875
Walter Turek -0- $ -0- 185,738 46,500 $7,279,270 $1,265,875
</TABLE>
(1) Represents market value of the Company's common stock at exercise date
less the exercise price.
(2) Represents market value of the Company's common stock at May 31,
1996, less the exercise price.
<PAGE>
PERFORMANCE GRAPH
The following graph shows a five-year comparison of the total
cumulative returns of investing $100 on May 31, 1991 in Paychex, Inc. Common
Stock, the S&P Midcap 400 Index and the S&P Computer Software and Service
Index. The S&P Midcap 400 Index represents a broad market group in which the
Company participates. The S&P Computer Software and Services Index (S&P C S
& S) was chosen as having a representative peer group of companies. The
Paychex, Inc. stock price performance shown assumes reinvestment of
dividends.
<TABLE>
<CAPTION>
Measure-
Ment
Point
5/31/91 5/31/92 5/31/93 5/31/94 5/31/95 5/31/96
________ _______ _______ _______ _______ _______
<S> <C> <C> <C> <C> <C> <C>
Paychex, Inc. $100 $165 $265 $318 $443 $998
S&P Midcap 400 $100 $116 $137 $143 $162 $208
S&P C S & S $100 $118 $158 $189 $266 $372
</TABLE>
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Except as set forth below, the Company is not aware of any persons
who held in excess of 5% of the Company's outstanding common stock at June
30, 1996.
<TABLE>
<CAPTION>
Amount and Nature of Percent
Name and Address Beneficial Owner of Class
<S> <C> <C>
B. Thomas Golisano 8,455,669 12.2
911 Panorama Trail South (1)
Rochester, New York 14625
Putnam Investments 5,771,776 8.3
One Post Office Square (2)
Boston, Massachusetts 02109
All Directors and Officers of 12,334,695 17.8
the Company as a Group (3)
</TABLE>
(1) See Footnote (1) to the table under "Nominees for Election" with
respect to Mr. Golisano.
(2) These securities are owned by Putnam Investments, Inc. and through
two wholly owned registered investment advisors, Putnam Investment
Management, Inc. and The Putnam Advisory Company, Inc.
(3) See Footnote (1) and (2) to the table under "Nominees for Election."
The shares included therein as subject to shared voting power by
Messrs. Golisano and Clark are included only once in this total. In
addition, the total includes the following shares which may be
acquired within 60 days by exercise of options: Walter Turek-185,738
shares; Edmund Russo-50,063 shares; Daniel Canzano-43,952 shares;
John Carlen-11,250 shares and Diane Rambo-6,600 shares.
INDEPENDENT PUBLIC ACCOUNTANTS
The Company's independent public accountant since 1983 has been Ernst
& Young LLP. Management expects to reappoint this firm for fiscal 1997.
However, it will not seek stockholder approval or ratification.
Representatives of Ernst & Young LLP are expected to be present at the
stockholders' meeting and will have an opportunity to make a statement if
they desire to do so. They are also expected to be available to respond to
appropriate questions.
<PAGE>
OTHER MATTERS AND INFORMATION
As of the date of this Proxy Statement, Management does not intend to
present, and has not been informed that any other person intends to present,
any matter for action at the meeting other than those described above. If
any other matters properly come before the meeting, it is intended that the
persons named in the enclosed Proxy will vote the Proxy on such matters in
accordance with their best judgment.
The cost of solicitation of Proxies will be paid by the Company. In
addition to solicitation by use of mails, some of the officers and regular
employees of the Company, without extra remuneration, may solicit Proxies
personally or by telephone, telegraph or cable. The Company will reimburse
any banks, brokers and other custodians, nominees and fiduciaries for their
expenses in forwarding Proxies and Proxy solicitation material to the
beneficial owners of the shares held by them.
PROPOSALS FOR NEXT YEAR'S ANNUAL MEETING
Stockholder proposals for inclusion in the Proxy Statement for the
next Annual Meeting of Stockholders must be received by the Company at its
executive offices on or before April 11, 1997.
BY THE ORDER OF THE BOARD OF DIRECTORS
/s/ G. Thomas Clark
___________________________
G. Thomas Clark, Secretary
Rochester, New York
August 9, 1996
<PAGE>
PAYCHEX, INC. PROXY
The undersigned hereby appoints B. THOMAS GOLISANO and G. THOMAS
CLARK, or any one of them, with full power of substitution, attorneys and
proxies to represent the undersigned at the Annual Meeting of Stockholders of
the Company to be held on October 3, 1996, and at any adjournment thereof,
with all the powers which the undersigned would possess if personally present
to vote all shares of stock which the undersigned may be entitled to vote at
said meeting.
I. ELECTION OF DIRECTORS
[ ] FOR all Nominees [ ] WITHHOLD all Nominees
B. Thomas Golisano, G. Thomas Clark, Donald W. Brinckman, Steven D.
Brooks, Phillip Horsley, Grant M. Inman, Harry P. Messina, Jr. and
J. Robert Sebo.
(TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, CIRCLE SUCH
NOMINEE'S NAME. YOUR PROXY WILL BE VOTED FOR REMAINDER.)
THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS.
PLEASE DATE, SIGN AND RETURN IT IN THE ENCLOSED ENVELOPE. IF NOT OTHERWISE
MARKED, THE SHARES REPRESENTED BY THIS PROXY SHALL BE VOTED "FOR" THE EIGHT
NOMINEES.
Dated: ______________________________, 1996
Signed: ______________________________
(Name of Stockholder to be signed
exactly as it appears on this proxy)
