<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<TABLE>
<S> <C>
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-12
DEVRY INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction
applies:
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(2) Aggregate number of securities to which transaction
applies:
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(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how
it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount Previously Paid:
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(3) Filing Party:
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(4) Date Filed:
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</TABLE>
<PAGE>
[LOGO]
September 23, 2000
Dear Stockholder:
On behalf of the Board of Directors of DeVry Inc., it is my pleasure to
invite you to attend your Company's Annual Meeting of Stockholders at 10:30
a.m., Tuesday, November 14, 2000, at The Northern Trust Company, 50 South
LaSalle Street, Chicago, Illinois.
We will begin with a discussion of the items listed in the enclosed proxy
statement, followed by a report on the growth of DeVry during the last fiscal
year. DeVry's performance is also discussed in the enclosed 2000 Annual Report
to stockholders, which we think you will find to be interesting reading.
We strongly encourage you to attend the meeting to represent your shares.
Whether or not you plan to attend in person, please mark, sign, date and return
your proxy card promptly. Proxy cards may be retrieved immediately prior to the
meeting if you would like to vote in person.
We look forward to greeting you at the meeting.
Thank you.
Sincerely,
/s/ Dennis J. Keller
Dennis J. Keller
CHAIRMAN OF THE BOARD
<PAGE>
DEVRY INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 14, 2000
You are cordially invited to attend the Annual Meeting of Stockholders of
DeVry Inc. at The Northern Trust Company, 50 South LaSalle Street, Chicago,
Illinois on Tuesday, November 14, 2000, at 10:30 a.m. Central Standard Time, for
the following purposes:
(1) To elect four Directors to serve as Class III Directors to serve
until the 2003 Annual Meeting of Stockholders;
(2) To ratify the appointment of PricewaterhouseCoopers LLP as
independent public accountants for the Company for the current fiscal year;
and
(3) To consider such other business as may properly come before the
meeting or any adjournment thereof.
You will find enclosed with this Notice a proxy card and a Proxy Statement
for the meeting and a copy of the DeVry Inc. Annual Report for 2000.
The Board of Directors has fixed a record date of September 15, 2000. Only
stockholders of record on that date are entitled to notice of, and to vote at,
the meeting. The principal office of the Company is situated at One Tower Lane,
Suite 1000, Oakbrook Terrace, Illinois 60181.
All stockholders are cordially invited to attend the meeting in person.
However, to assure representation at the meeting, you are encouraged to mark,
sign, date and return the enclosed proxy card as promptly as possible in the
postage-prepaid envelope provided for that proxy. Postage is not required for
mailing in the United States. Upon request, the Company will reimburse
stockholders for the cost of mailing proxy cards from outside the United States.
You may attend the meeting and vote in person even if you have returned a proxy.
<TABLE>
<S> <C>
MARILYNN J. CASON
SECRETARY
Oakbrook Terrace, Illinois
September 25, 2000
</TABLE>
<PAGE>
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS, NOVEMBER 14, 2000
The Board of Directors of DeVry Inc. (the "Company") is sending you this
Proxy Statement and the accompanying proxy card in connection with its
solicitation of proxies to be voted at the Company's Annual Meeting of
Stockholders to be held on November 14, 2000, and any adjournment thereof. This
Proxy Statement and accompanying proxy are first being sent to stockholders on
or about September 27, 2000. The solicitation of proxies gives all stockholders
an opportunity to vote. Your shares can be voted only if you are present or
represented by proxy at the meeting.
When you have marked, signed, dated and returned your proxy card, the Proxy
Committee (and each of them, with full powers of substitution) will vote your
shares as you direct. Please indicate your choices by marking the boxes on the
enclosed card. If you sign, date and return your proxy card to us without
choices for each proposal, the Proxy Committee will vote your shares on the
unmarked proposals as recommended by the Board of Directors. Abstentions,
directions to withhold authority and broker non-votes (where a named entity
holding shares for a beneficial owner has not received voting instructions from
the beneficial owner regarding a particular matter and such named entity does
not possess or choose to exercise discretionary authority with respect thereto)
will be considered present at the meeting for purposes of a quorum but will not
be counted in determining the total number of votes cast. Anyone giving a proxy
may revoke it at any time before the proxy is voted at the meeting by: (1)
notifying the Company in writing that the proxy has been revoked; (2) executing
a later-dated proxy; or (3) voting in person at the meeting. The election of
Directors and the ratification of the appointment of the independent public
accountants will each require the affirmative vote of a majority of the shares
of Common Stock of the Company present or represented at the meeting.
If you are a Company employee who is a participant in the DeVry Inc.
Employee Stock Purchase Plan and/or the Profit Sharing Retirement Plan's DeVry
Stock Fund, the accompanying proxy card, when returned properly signed, will
serve as direction to the Custodian of the Stock Purchase Plan or the Trustee of
the Stock Fund to vote the shares held in the Stock Purchase Plan and/or the
Stock Fund, respectively, for your account in accordance with your direction. If
you return a proxy card without indicating your voting preference, the shares
represented by your proxy card will be voted in the same proportion as shares
timely voted by proxies returned.
The Company will bear the expense of soliciting proxies. The solicitation
initially will be made by mail but also may be made by Company employees by
telephone, electronic means or personal contact.
The Company will reimburse all stockholders for the expense of sending
proxies and proxy material to beneficial owners, including expenditures for
foreign mailings.
As of September 15, 2000, the Company had 69,676,601 shares of Common Stock
($0.01 par value) outstanding. Stockholders are entitled to one vote per share
owned on the record date.
ELECTION OF DIRECTORS
The Company's Certificate of Incorporation provides for a Board of Directors
of not less than three nor more than twelve Directors, as determined from time
to time by resolution of the Board, that is divided into three classes of
Directors serving staggered three-year terms. The Board has set the number of
Directors at eleven. The members of Class III, whose terms of office expire in
2000, are Charles A. Bowsher, Robert C. McCormack, Julie A. McGee and Ronald L.
Taylor, all of whom have been nominated to stand for election as Directors at
the 2000 meeting to hold office until 2003 or until their respective successors
are elected and qualified. All of the nominees have served as Directors since
the last annual meeting.
It is intended that all shares represented by a proxy in the accompanying
form will be voted for the election of the persons listed below as Class III
Directors for a three-year term unless otherwise specified
1
<PAGE>
in such proxy. A proxy cannot be voted for more than four persons. In the event
any one or more of such nominees shall be unable to serve as Director, votes
will be cast pursuant to the authority granted in the enclosed proxy for such
person or persons as may be designated by the Board of Directors. The Board has
no reason to believe that any nominee will become unavailable for election.
The nominees for election as Directors are listed below, along with brief
statements setting forth their current principal occupations, business
experience and other information, including directorships in other public
companies.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES LISTED BELOW.
NOMINEES
CLASS III - TERM EXPIRES 2003
CHARLES A. BOWSHER, age 69
Mr. Bowsher has been a Director of the Company since February 1997. In 1996
Mr. Bowsher completed a 15-year term as Comptroller General of the United States
and head of the General Accounting Office. Prior to that he was affiliated with
Arthur Andersen and Co. for 25 years, except for a four-year period when he
served as Assistant Secretary of the Navy for Financial Management. Mr. Bowsher
is also a director of American Express Bank, National Steel Corporation and
Newport News Shipbuilding.
ROBERT C. MCCORMACK, age 61
Mr. McCormack has been a Director of the Company since 1995. He is a
founding partner of Trident Capital, Inc., a private equity firm established in
1993 to invest in information and business service companies. From 1990 to 1993
Mr. McCormack was the Assistant Secretary and Comptroller of the Navy, prior to
which time he served for 2 1/2 years in various positions on the staff of the
Secretary of Defense. Mr. McCormack spent 20 years in investment banking with
Dillon, Read & Co. Inc. and Morgan Stanley & Co. Incorporated before his
government service. He is also a director of Illinois Tool Works, Inc.,
MapQuest.com, Inc. and Northern Trust Corp.
JULIE A. MCGEE, age 58
Ms. McGee has been a Director of the Company since 1994. From 1991 to 1994
she was President of McDougal, Littell & Co. Upon its acquisition by Houghton
Mifflin in 1994, she also became Executive Vice President, Houghton Mifflin.
Houghton Mifflin publishes print and electronic materials for elementary and
secondary schools and colleges and references for the office automation and
microcomputer markets, as well as fiction and nonfiction literature. Ms. McGee
began her career at McDougal Littell in 1988 as an editorial director. From 1986
to 1988 she held management positions at Ligature, Inc., prior to which she was
for three years Director of Marketing and Software Development for a division of
Tandy Corporation.
RONALD L. TAYLOR, age 57
Mr. Taylor has been a Director, President and Chief Operating Officer of the
Company since 1987. In 1973 Mr. Taylor co-founded Keller Graduate School of
Management, Inc. ("KGSM") and was from 1973 to 1981 its Chief Operating Officer
and from 1981 to 1987 its President and Chief Operating Officer.
2
<PAGE>
INCUMBENT DIRECTORS
CLASS I - TERM EXPIRES 2001
EWEN M. AKIN, age 70
Dr. Akin has been a Director of the Company since February 1997. He was
President of Kennedy-King College in Chicago from 1976 to 1986 and President of
Malcolm X College in Chicago from 1973 to 1976. From 1970 to 1973 he was Vice
President for Academic Affairs at Kennedy-King College, prior to which time he
was a member of the physics faculty there.
THURSTON E. MANNING, age 74
Dr. Manning has been a Director of the Company since 1990. He was President
of the Council on Post-secondary Accreditation from 1987 until July 1991, prior
to which time he was for 12 years Executive Director of the Commission on
Institutions of Higher Education of the North Central Association of Colleges
and Schools. Since 1991, Dr. Manning has been a self-employed consultant.
HUGO J. MELVOIN, age 71
Mr. Melvoin has been a Director of the Company since 1987. He was a founding
stockholder and director of KGSM. A practicing attorney since 1953, Mr. Melvoin
was a partner in the Chicago law firm of Mayer, Brown & Platt from 1960 to 1981.
He retired in 1999 from the law firm of Hugo Melvoin, P.C.
CLASS II - TERM EXPIRES 2002
DAVID S. BROWN, age 59
Mr. Brown has been a Director of the Company since 1987 and was a founding
stockholder and director of KGSM. Mr. Brown, a practicing attorney, was a
partner in the Chicago law firm of McBride and Baker from 1972 to 1979 and
served as General Counsel of the U.S. Office of Minority Business Enterprise
from 1971 to 1972. From 1980 to 1996, Mr. Brown was employed by United
Laboratories, Inc., a manufacturer and seller of specialty chemicals, most
recently as Executive Vice President, Chief Financial Officer and General
Counsel.
DENNIS J. KELLER, age 59
Mr. Keller has been Chairman of the Board and Chief Executive Officer of the
Company since 1987. Mr. Keller co-founded KGSM and was from 1973 to August 1987
its Chairman of the Board and Chief Executive Officer. He is also a director of
NICOR, Inc.
ROBERT E. KING, age 65
Mr. King has been a Director of the Company since 1987. He is Chairman of
Salt Creek Ventures, a private equity firm. From 1983 through 1994, Mr. King was
Chairman and Chief Executive Officer of the Newtrend Group, a software and
computer services company. He was President and Chief Executive Officer of
DELTAK, Inc., a video publisher, from 1971 to 1982.
FREDERICK A. KREHBIEL, age 59
Mr. Krehbiel has been a Director of the Company since 1996. Employed since
1965 by Molex Incorporated, an electronic component manufacturer, he served as
CEO from 1988 to 1999 and as Chairman from 1993 to 1999. Since July 1999,
Mr. Krehbiel has served as Co-Chairman and Co-CEO. Mr. Krehbiel is also a
director of Tellabs, Inc., and Northern Trust Corp.
3
<PAGE>
BOARD OF DIRECTORS AND COMMITTEE MEETINGS
There were four regular meetings of the Board of Directors during fiscal
2000. During that year all incumbent Directors attended 75 percent or more of
the aggregate of the total number of meetings of the Board of Directors and of
the committees of the Board of Directors on which they served. The Board has
standing nominating, audit, finance and compensation committees.
Messrs. Keller (Chair), Taylor, King, McCormack and Brown serve as members
of the Company's NOMINATING COMMITTEE, which met once during fiscal 2000. The
Committee is responsible for proposing a slate of directors for election by the
stockholders at each annual meeting and for proposing candidates to fill any
vacancies on the Board. The Nominating Committee will accept and consider
nominations of Directors from stockholders. Such nominations should be sent to
the Corporate Secretary, specifying the name of the nominee and the
qualifications of such nominee for membership on the Board of Directors. All
such recommendations will be brought to the attention of the Nominating
Committee.
Messrs. Bowsher (Chair), Akin and Brown, and Ms. McGee serve as members of
the AUDIT COMMITTEE of the Board of Directors of the Company. The principal
duties of the Audit Committee, which met four times during fiscal 2000, include
recommending the appointment of the Company's independent public accountants,
subject to ratification by the stockholders; review of the scope, approach and
results of the annual audits; review of annual and quarterly financial
statements; review of the representations of management and the findings and
suggestions of the independent public accountants regarding internal control,
financial policies and procedures and management's response thereto; monitoring
the effectiveness of the Company's internal controls; and review of unusual or
significant financial transactions or findings.
Messrs. McCormack (Chair), Keller, Taylor, King and Brown serve as members
of the Company's FINANCE COMMITTEE, which met once during fiscal 2000. The
Committee's principal duties include review and recommendation with respect to
the Company's financing policies, including cash flow, capital structure and
dividend policy.
Dr. Manning (Chair) and Messrs. King, Krehbiel and Melvoin serve as members
of the COMPENSATION COMMITTEE, which held two meetings in fiscal 2000. The role
of the Compensation Committee is to establish and oversee the policies that
govern Company compensation and benefit practices and includes review of the
salaries of the senior officers of the Company each year and approval of
management incentive awards and stock option grants. The report of the
Compensation Committee on Executive Compensation appears on pages 10 to 12 of
this Proxy Statement.
Directors are each paid a retainer of $20,000 per annum plus $1,250 for each
Board of Directors meeting attended. Additionally, non-employee committee
members are paid $500 per committee meeting attended. Also, Directors are
eligible to receive options under the Company's 1994 and 1999 Stock Incentive
Plans and are currently granted options for 5,250 shares upon election or
re-election to the Board. These options vest in 3 annual installments beginning
1 year from the date of election. Directors are reimbursed for any expenditures
attendant to Board membership.
Under the DeVry Inc. Board of Directors' Deferred Compensation Plan each
Director may elect to defer all or a portion of such compensation. Any amount so
deferred is, at the Director's election, valued as if invested in the Company's
Common Stock and/or the average yield on corporate bonds as determined by
Mergent Bond Record, and is payable in cash in installments or as a lump-sum on
or after termination of services as a Director.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, (the
"Exchange Act"), requires that the Company's Directors, executive officers and
holders of more than 10% of the Company's Common Stock file reports of ownership
and changes in ownership of Common Stock with the Securities and Exchange
Commission. During the fiscal year ended June 30, 2000, all such persons filed
on a timely basis all reports required by Section 10(a) of the Exchange Act,
with the following exceptions. James A. Dugan and Raul Valdez-Pages, corporate
officers, were late in filing their initial report on Form 3 due to the
Company's failure to timely provide them with the necessary forms.
4
<PAGE>
STOCK OWNERSHIP
The table below sets forth the number and percentage of outstanding shares
of Common Stock beneficially owned by (1) each person known by the Company to
own beneficially more that 5% of the Common Stock, (2) each Director of the
Company, (3) each nominee for election as Director, (4) each executive officer
named in the Summary Compensation Table on page 7 and (5) all Directors and
officers of the Company as a group, in each case as of June 30, 2000, except as
otherwise noted. The Company believes that each individual or entity named has
sole investment and voting power with respect to the shares of Common Stock
indicated as beneficially owned by them, except as otherwise noted. All share
amounts referred to in this Proxy Statement have been adjusted to reflect the
two-for-one stock splits on June 21, 1995, December 18, 1996 and June 19, 1998.
<TABLE>
<CAPTION>
SHARES PERCENTAGE
NAME OWNED(1) OWNERSHIP
---- -------- ----------
<S> <C> <C> <C>
Dennis J. Keller.......................................... 9,284,126 (2) 12.9%
Ronald L. Taylor.......................................... 2,313,135 (3) 3.2
Ewen M. Akin.............................................. 7,164 (4) *
Charles A. Bowsher........................................ 8,236 (4)(16) *
David S. Brown............................................ 190,500 (5) *
Robert E. King............................................ 202,480 (5)(6) *
Frederick A. Krehbiel..................................... 30,350 (7) *
Thurston E. Manning....................................... 43,500 (5) *
Robert C. McCormack....................................... 848,051 (8)(16) 1.2
Julie A. McGee............................................ 31,500 (9) *
Hugo J. Melvoin........................................... 138,496 (5)(10)(16) *
Bruno R. LaCaria.......................................... 1,739 (11) *
Michael J. Laforte, Jr.................................... 10,332 (12) *
O. John Skubiak........................................... 139,857 (13) *
GeoCapital Corporation.................................... 3,634,150 (14) 5.2
Baron Capital, Inc........................................ 7,458,300 (15) 10.7
All Directors and Officers as a Group (29 Persons)........ 12,738,939 18.3
</TABLE>
------------------------
* Represents less than 1% of the outstanding Common Stock.
(1) Calculated pursuant to Rule 13-3(d) of the Exchange Act. Under
Rule 13-3(d), shares not outstanding that are subject to options, warrants,
rights or conversion privileges exercisable within 60 days are deemed
outstanding for the purpose of calculating the number and percentage owned
by such person, but not deemed outstanding for the purpose of calculating
the percentage owned by each other person.
(2) Includes 9,512 shares owned by Mr. Keller's wife and 251,250 shares subject
to purchase upon the exercise of stock options. Mr. Keller disclaims
beneficial ownership of the shares owned by his wife.
(3) Includes 2,800 shares owned by Mr. Taylor's children and 106,974 shares
subject to purchase upon the exercise of stock options. Mr. Taylor
disclaims beneficial ownership of the shares owned by his children.
(4) Includes 7,124 shares subject to purchase upon the exercise of stock
options.
(5) Includes 43,500 shares subject to purchase upon the exercise of stock
options.
(6) Includes 3,340 shares owned by Mr. King's wife and the following shares
held by trusts for which Robert E. King is trustee: 51,880 shares of Common
Stock held by LaSalle Trust No. 03-630780-9 for Robert E. King, Jr.; 51,880
shares of Common Stock held by LaSalle Trust No. 03-630780-1 for Heather
Oakes King; and 51,880 shares of Common Stock held by LaSalle Trust
No. 03-630770-0 for
5
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Margaret E. King. The trusts and their respective beneficiaries mentioned
in this footnote acquired the shares upon the dissolution of Keltin
Partnership. Mr. King disclaims beneficial ownership of the shares owned by
his wife and the shares held by trusts.
(7) Includes 14,250 shares subject to purchase upon the exercise of stock
options.
(8) Includes 24,896 shares held by Northern Trust Company and Robert C.
McCormack Trust UA DTD 10-6-67; 760,000 shares contributed to McCormack DV
Management Limited Partnership by Mr. McCormack and 762 shares contributed
by his wife; 39,238 shares held by his wife; and 15,000 shares subject to
purchase upon the exercise of stock options. Mr. McCormack disclaims
beneficial ownership of the shares owned or contributed by his wife.
(9) Includes 31,500 shares subject to purchase upon the exercise of stock
options.
(10) Includes 15,000 shares owned by the Melvoin Foundation.
(11) Includes 1,500 shares subject to purchase upon the exercise of stock
options and 239 shares held in the DeVry Inc. Profit Sharing Retirement
Plan.
(12) Includes 9,620 subject to purchase upon the exercise of stock options and
212 shares held in the DeVry Inc. Profit Sharing Retirement Plan.
(13) Includes 14,344 shares held in an IRA at Northern Trust Brokerage, 23,200
shares held in an IRA at Northern Trust Brokerage for his wife and 89,034
shares subject to purchase upon the exercise of stock options.
(14) GeoCapital Corporation, whose address is 767 Fifth Avenue, New York, New
York 10153, as of September 15, 2000 had shared voting power and sole
investment power as to 3,634,150 shares.
(15) Baron Capital, Inc. whose address is 450 Park Avenue, New York, New York
10022, as of September 15, 2000 had shared voting and investment power as
to 7,458,300 shares.
(16) Includes shares of phantom Common Stock held in the DeVry Inc. Board of
Directors' Deferred Compensation Plan as follows: Mr. Bowsher -- 1,112
shares, Mr. McCormack -- 507 shares and Mr. Melvoin -- 1,068 shares.
6
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EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-----------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
----------------------------------------- ------------------------ --------
SECURITIES
RESTRICTED UNDERLYING
NAME AND OTHER ANNUAL STOCK OPTIONS/ LTIP
PRINCIPAL POSITION YEAR SALARY(1) BONUS(1)(2) COMPENSATION(3) AWARD(S) SARS(#)(4) PAYOUTS
------------------ -------- --------- ----------- --------------- ---------- ----------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Dennis J. Keller, 2000 $397,083 $688,939 $ 6,121 35,500
Chairman and Chief 1999 381,811 687,260 16,630 31,125
Executive Officer 1998 372,895 652,422 7,524 51,000
Ronald L. Taylor, 2000 397,083 688,939 10,313 35,500
President and Chief 1999 381,811 687,260 9,942 31,125
Operating Officer 1998 372,895 652,422 1,042 51,000
O. John Skubiak, 2000 183,750 180,000 2,536 18,000
Senior Vice President 1999 175,000 140,000 1,725 15,585
1998 162,000 125,000 1,750 24,000
Michael J. LaForte, 2000 182,000 150,000 7,145 10,000
Senior Vice President 1999 165,000 100,000 5,550 5,050
1998 144,000 50,000 4,674 4,000
Bruno C. LaCaria, 2000 196,100 50,000 2,646 2,500
Vice President and 1999 165,111 30,000 814 2,500
Chief Information 1998
Officer
<CAPTION>
NAME AND ALL OTHER
PRINCIPAL POSITION COMPENSATION(5)
------------------ ---------------
<S> <C>
Dennis J. Keller, $28,117
Chairman and Chief 15,935
Executive Officer 15,110
Ronald L. Taylor, 21,945
President and Chief 21,618
Operating Officer 19,637
O. John Skubiak, 12,612
Senior Vice President 10,722
10,210
Michael J. LaForte, 6,748
Senior Vice President 7,605
6,010
Bruno C. LaCaria, 6,560
Vice President and 2,769
Chief Information
Officer
</TABLE>
------------------------------
(1) Mr. Keller elected to defer 2% of his salary during fiscal years 2000 and
2001 and 2% of his fiscal year 2000 bonus; Mr. Taylor elected to defer 2% of
his fiscal year 2001 salary; Mr. LaForte elected to defer 20% of his fiscal
year 2000 bonus; and Mr. LaCaria elected to defer 28% of his fiscal year
2000 salary and 100% of his fiscal year 2000 bonus. For a description of the
DeVry Inc. Deferred Compensation Plan, under which all of the above
deferrals were effected, see "Compensation Committee Report on Executive
Compensation" on page 10.
(2) Amount includes bonuses earned in fiscal year 2000 and paid in fiscal year
2001.
(3) During the covered fiscal years no executive officer named in the table
received any other annual compensation in an amount in excess of the lesser
of either $50,000 or 10% of the total of annual salary and bonus reported
for him in the two preceding columns.
(4) Options to acquire shares of Common Stock.
(5) These amounts represent the Company's contributions to its Profit Sharing
Retirement Plan and the dollar value of insurance premiums paid by the
Company with respect to term life insurance and supplemental health
insurance for the benefit of the named executive officers. Under its group
life insurance plan the Company provides life insurance to all employees in
the amount of their annual salary up to $500,000. The following premiums
were paid: Mr. Keller, $4,645; Mr. Taylor, $12,025; Mr. Skubiak, $2,692;
Mr. LaForte, $188; and Mr. LaCaria, none.
EMPLOYMENT AGREEMENTS. The Company has entered into employment agreements
having substantially identical terms with Dennis J. Keller and Ronald L. Taylor
(each an "Executive"). Each agreement provides for an initial base salary,
annual salary increases and annual bonuses for an initial term of employment
ending on June 30, 1993, which thereafter continues until either the Executive
or the Company provides the other with at least 150 days' notice. Each
employment agreement provides that it may be terminated by the Company upon (1)
the death of the Executive, (2) the physical or mental disability of the
Executive which prevents him from performing his duties for a continuous period
of 180 days or (3) for cause (as defined in the employment agreement). The
Executive may terminate the agreement if (1) he is not accorded the authority,
duties, obligations and prerogatives set forth in the agreement; (2) such
authority, duties, obligations or prerogatives are materially or substantially
reduced; (3) he is not paid or reimbursed amounts due him under the agreement or
(4) the Company fails to observe its obligations under the agreement. In the
event the Company terminates the agreement or fails
7
<PAGE>
to continue or renew the agreement or the Executive terminates the agreement for
any reason stated in the preceding sentence, the Executive is entitled to
severance payments.
The following table provides information about options granted to the named
executive officers during fiscal 2000 under the Company's 1991 Stock Incentive
Plan and the 1994 Stock Incentive Plan. Under these plans, the Board of
Directors (1991 Plan) or the Plan Committee (1994 Plan) determines the Directors
or key employees eligible to participate and the number of shares to be granted
(subject to Compensation Committee approval of employee grants of non-qualified
and/or incentive stock options) and the prices at which and periods during which
such options may be exercised (typically 5-year vesting for employees and 3-year
vesting for Directors, and a 10-year exercise period). In no case may the
exercise price be less than 100% of fair market value on the date of grant or
the period of exercise be longer than 10 years from the date of grant. The plans
do not limit the number of options that may be granted to any participant or the
number of individuals who may participate, and additional options may be granted
to previous recipients of options.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
----------------- VALUE AT ASSUMED
NUMBER OF % OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS/SARS PRICE APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OR OPTION TERM
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION -----------------------
NAME GRANTED (#) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
---- ------------ ----------------- ----------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Dennis J. Keller............ 35,000 15% $21.2188 8/17/09 $467,053 $1,183,605
Dennis J. Keller............ 500 .21% 24.0000 7/1/09 7,546 19,124
Ronald L. Taylor............ 35,000 15% 21.2188 8/17/09 467,053 1,183,605
Ronald L. Taylor............ 500 .21% 24.0000 7/1/09 7,546 19,124
O. John Skubiak............. 18,000 7.6% 21.2188 8/17/09 240,199 608,711
Michael J. LaForte, Jr...... 10,000 4.2% 21.2188 8/18/09 133,443 338,173
Bruno R. LaCaria............ 2,500 1.0% 21.2188 8/10/09 33,360 84,543
</TABLE>
The following table provides information about options exercised by the
named executive officers during fiscal 2000 and the number and value of options
held at the end of fiscal 2000, many of which are not yet exercisable. The
Company does not have any stock appreciation rights outstanding.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNEXERCISED
UNDERLYING IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
FY-END (#) FY-END ($)(1)
SHARES --------------- ---------------------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
---- ------------- ------------ --------------- ---------------------
<S> <C> <C> <C> <C>
Dennis J. Keller........................ -- -- 209,625/118,000 $4,174,157/1,109,184
Ronald L. Taylor........................ 97,876 $1,482,768 65,349/118,000 876,388/1,109,184
O. John Skubiak......................... -- -- 69,517/56,868 1,311,493/520,809
Michael J. LaForte, Jr.................. -- -- 5,010/18,040 58,967/121,431
Bruno R. LaCaria........................ -- -- 500/4,500 3,312/26,296
</TABLE>
--------------------------
(1) Represents the difference between the closing price of the Common Stock on
the New York Stock Exchange on June 30, 2000, and the exercise price of the
option.
8
<PAGE>
PROFIT SHARING RETIREMENT PLAN. Employees of the Company and its
subsidiaries who have 30 days or more of service with the Company participate in
the 401(k) component of the DeVry Inc. Profit Sharing Retirement Plan (the
"Profit Sharing Retirement Plan"), which as of June 30, 2000, covered 2,739 of
the Company's employees, including 323 former employees. Under the Profit
Sharing Retirement Plan, employees share in the success and profitability of the
Company through a combination of Company matching and discretionary
contributions to its eligible employees. Regular full-time employees and regular
part-time employees who complete 1,000 hours of service during a Profit Sharing
Retirement Plan Year (July 1 - June 30) are automatically enrolled in the Profit
Sharing Retirement Plan following their completion of one year of service to the
Company. Eligible employees may choose to open a 401(k) account and contribute
from 1% to 15% of their annual eligible compensation. To those employees
contributing 1% to a 401(k) account, the Company makes a matching contribution
of 1% of their total annual eligible compensation (including salary, overtime
pay and bonuses); to those employees contributing 2% or more, the Company makes
a matching contribution of 2% of their total annual eligible compensation.
Allocations of the Company's discretionary profit sharing contribution under a
formula based on salary and seniority are made to eligible employees who have
completed one year of service as of the last day of any Profit Sharing
Retirement Plan year.
9
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
To Our Stockholders:
The Company applies a consistent philosophy to compensation for all
employees, including senior management. This philosophy is based on the premise
that the achievements of the Company result from the combined efforts of all
employees working toward common objectives. The Company seeks to achieve these
objectives through teamwork that is focused on meeting the expectations of its
customers (students and their employers) and its stockholders.
The Compensation Committee has the responsibility, with respect to the
Company's executive officers, to implement that philosophy in a manner that will
align executive compensation with the business objectives and performance of the
Company and will also enable the Company to attract, retain and motivate
executive officers to ensure its long-term success. To that end, the Committee
evaluates the performance of the Chairman and Chief Executive Officer ("CEO")
and of the President and Chief Operating Officer ("COO"), reviews with senior
management the performance of executive officers generally and, respectively,
determines or reviews recommendations for their compensation levels in terms of
salaries, bonuses and related benefits.
Under the current program, there are three components to the compensation of
executive officers: salary, annual incentive compensation and long-term
incentive compensation. The Compensation Committee considers the total
compensation of each executive, including the CEO and the COO, in establishing
the elements of executive compensation. The current compensation of the CEO and
the COO (who are deemed jointly and equally responsible for the success of the
Company and are therefore compensated equally), as well as the compensation of
all other executives, reflects another year of superior Company results. (In
fiscal year 2000, DeVry's revenues increased by 20%, its net income by 23% and
its earnings per share by 24% over the previous year.)
SALARY
In its annual review of the salaries of each of the Company's executives,
the Compensation Committee considers, among other factors, the responsibilities
and individual performance (both in the current year and over time) of the
executive, the Company's performance and the performance of the executive's
business unit. Salaries at companies of comparable size, with whom the Company
must compete for talent, are also considered.
With respect to the CEO and the COO, the Committee's policy is to provide
total cash compensation that represents salary reasonable in amount and
additional compensation determined by stockholder returns. To that end, the
Compensation Committee's practice is to limit CEO and COO salary increases to
the percentage established by the Company as the pool amount for salary
increases for all employees (from 4% to 4 1/2% in recent years, and 4% for the
fiscal year 2000). As a result, the salary portion of their total compensation
is approximately 35%-45%, retaining annual incentive compensation, with its
focus on long-term growth in earnings per share, as the primary compensation
vehicle.
ANNUAL INCENTIVE COMPENSATION
Annual incentive compensation for executive officers other than the CEO and
the COO consists of discretionary cash bonuses awarded annually to executives
(and certain other management employees) based on the achievement of certain
Company targets and personal objectives. These bonuses are the primary vehicle
for recognizing and rewarding accomplishments in a given year. The specific
bonus an executive receives is dependent on individual performance and level of
responsibility.
The Compensation Committee has adopted the premise that long-term growth in
earnings is the single best proxy for stockholder interests. The annual
incentive compensation program for the CEO and the COO, which is based primarily
on a growth in earnings per share bonus program, has been designed to
10
<PAGE>
that end. Under the program, the Company's growth in earnings per share over the
most recent five years determines approximately two-thirds of the bonus amount,
and current year growth in earnings per share determines approximately
one-third. No annual incentive bonus will be paid under this program if both
five-year and annual earnings per share growth is 5% or less. Additionally, the
earnings per share growth bonus factor has been capped at 25% because the
Compensation Committee believes that, in the Company's industry, it is difficult
to sustain annual earnings per share growth at a rate greater than 25% while
meeting the needs of customers without some degradation in quality. The
Committee may, however, recognize or provide additional objectives for the
Company and tie other cash awards to the achievement of those objectives and
recommend approval of such to the Board of Directors. The Company's steady and
substantial growth in earnings per share under the leadership of the CEO and the
COO (approximately 25% per year from 1993 to 2000) has resulted in substantial
growth in their compensation, which the Committee believes is appropriate and in
keeping with the total compensation paid by comparable companies of similar
size.
LONG-TERM INCENTIVE COMPENSATION
Stock options are used as the primary long-term incentive vehicle. Options
provide executives and other key employees with the opportunity to buy and
maintain an equity interest in the Company and to share in the appreciation in
value of its Common Stock. To assure that the value of every stockholder's
interest must appreciate before the option holder receives any benefit from the
option, options have been granted at no less than the fair market value of the
Company's Common Stock on the date of grant. Additionally, options are generally
granted with a 5-year vesting period and a 10-year exercise period so as to
encourage executives and others to take a longer-term view of their individual
contributions to the Company. The Compensation Committee believes that stock
options are an important tool to align the interests of management and
stockholders. The CEO, the COO, the three other named executive officers and
certain other executive officers were among the 233 Company employees granted
stock options based on their superior performance during fiscal year 2000.
DEFERRED COMPENSATION PLAN. In August 1999, the Committee approved another
component of DeVry's executive compensation program, the DeVry Inc. Deferred
Compensation Plan (the "Deferred Plan"). The Deferred Plan is a voluntary,
non-tax qualified, deferred compensation plan available to executive officers
and certain other members of DeVry management, and enables such individuals to
save for retirement by deferring a portion of their current compensation. Under
the Deferred Plan, participants are entitled to defer compensation until
termination of service with DeVry or other specified dates. Participants may
elect to have their deferred amounts credited with earnings based on various
investment choices made available by the Committee for this purpose.
Participants' dependents are also eligible to receive a pre-retirement death
benefit. The purpose of this Deferred Plan is to encourage participants to
remain in the service of DeVry as benefits of the Deferred Plan increase over
time.
The salary, annual incentive compensation and long-term incentive
compensation paid by the Company to the CEO, the COO and the three other named
executive officers of the Company in fiscal 2000 is set forth on page 7. The
Compensation Committee believes that the executive officers of the Company
continue to be dedicated to increasing stockholder value and that the
Committee's compensation policies contribute to this focus.
The Compensation Committee does not believe that the provisions of Section
162(m) of the Internal Revenue Code relating to the deductibility of
compensation paid to the executive officers named in the Summary Compensation
Table will limit the deductibility of such compensation expected to be paid by
the Company. Although the Board of Directors currently intends for all
compensation to be tax deductible to the Company, the Compensation Committee
will continue to evaluate the impact of such provisions and take such actions as
it deems appropriate.
11
<PAGE>
This Compensation Committee report is not to be deemed incorporated by
reference by any general statement incorporating by reference this Proxy
Statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent that the Company
specifically incorporates this report by reference, and is not otherwise to be
deemed filed under such Acts.
COMPENSATION COMMITTEE
Thurston E. Manning, Chairman
Robert E. King
Frederick A. Krehbiel
Hugo J. Melvoin
CERTAIN TRANSACTIONS
For the fiscal year 2000 the Company paid The Revere Group, an information
systems consulting organization, $1,360,000 for consulting services. Robert C.
McCormack, one of the Company's Directors, is also a director of The Revere
Group, and Trident Capital, Inc., of which Mr. McCormack is a founding partner,
is an investor in The Revere Group.
During the same fiscal year, DeVry purchased $755,000 in college textbooks
from Houghton Mifflin Company. Julie A. McGee, a Company Director, is Executive
Vice President of Houghton Mifflin Company.
Management believes that these transactions and any relationships during
fiscal 2000 were on terms that were reasonable and competitive. Additional
transactions and relationships of this nature may be expected to take place in
the ordinary course of business in the future.
12
<PAGE>
PERFORMANCE GRAPH
The following graph and chart compare the total cumulative return (assuming
dividend reinvestment) on the Company's Common Stock during the period from
June 30, 1995 through June 30, 2000 with the cumulative return on the NYSE Stock
Market Index (U.S. Companies), and an industry group index. This graph
demonstrates the markets' support of the Company's strong financial performance,
as the return on the Company's Common Stock has significantly outperformed both
the general market as represented by the NYSE index, and the industry as
represented by the industry group.
COMPARISON OF CUMULATIVE TOTAL RETURN SINCE JUNE 30, 1995
AMONG DEVRY INC., NYSE MARKET INDEX,
AND INDUSTRY GROUP INDEX
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
JUNE 30
<S> <C> <C> <C> <C> <C> <C>
1995 1996 1997 1998 1999 2000
DeVry Inc. 100.0 225.0 270.0 438.8 447.5 528.8
NYSE Market Index-U.S. Companies 100.0 126.0 165.0 211.6 242.7 242.9
Industry Group Index 100.0 171.9 239.3 286.4 228.9 232.5
</TABLE>
<TABLE>
<CAPTION>
JUNE 30
---------------------------------------------------------------
1995 1996 1997 1998 1999 2000
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
DeVry Inc......................................... 100.0 225.0 270.0 438.8 447.5 528.8
NYSE Market Index -- U.S. Companies............... 100.0 126.0 165.0 211.6 242.7 242.9
Industry Group Index.............................. 100.0 171.9 239.3 286.4 228.9 232.5
</TABLE>
Data for this graph was prepared by The University of Chicago Graduate
School of Business -- Center for Research in Security Prices.
Assumes $100 was invested on June 30, 1995 in DeVry Inc. Common Stock, the
NYSE Stock Market Index (U.S. Companies) and the Industry Group(1), and that all
dividends were reinvested.
------------------------
(1) The Industry Group consists of the following companies selected on the basis
of the similarity in the nature of their business: Apollo Group, Inc.,
Argosy Education Group, Inc., Berlitz International, Inc., Career Education
Corp., Computer Learning Centers, Inc., Corinthian Colleges, Inc., Education
Management Corp., EduTrek International, Inc., Flightsafety
International, Inc., ITT Educational Services, Inc., Learning Tree
International, Inc., Quest Education Corp., Strayer Education, Inc., Sylvan
Learning Systems, Inc., TesseracT Group, Inc. and Whitman Education Group,
Inc. The Company believes that, including itself, these companies represent
the majority of the market value of publicly traded companies whose primary
business is education.
13
<PAGE>
APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Upon the recommendation of its Audit Committee, the Board of Directors has
appointed PricewaterhouseCoopers LLP, independent public accountants, as
independent public accountants for the Company and its subsidiaries for fiscal
year 2001. The Board of Directors recommends to the stockholders that the
appointment of PricewaterhouseCoopers LLP as independent public accountants for
the Company and its subsidiaries be ratified. If the stockholders do not ratify
the appointment of PricewaterhouseCoopers LLP, the selection of independent
public accountants will be reconsidered by the Audit Committee and the Board of
Directors. Representatives of PricewaterhouseCoopers LLP are expected to be
present at the Annual Meeting of Stockholders with the opportunity to make a
statement, if they desire to do so, and to be available to respond to
appropriate questions from stockholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THE SELECTION
OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE COMPANY.
STOCKHOLDER PROPOSALS -- 2001 ANNUAL MEETING
Stockholder proposals intended to be presented at the 2001 Annual Meeting
must be received by the Company no later than May 30, 2001, to be eligible for
inclusion in the Proxy Statement and form of proxy for the meeting.
OTHER BUSINESS
The Board of Directors is aware of no other matter that will be presented
for action at this meeting. If any other matter requiring a vote of the
stockholders properly comes before the meeting, the Proxy Committee will vote
and act according to their best judgment.
By Order of the Board of Directors
Marilynn J. Cason
SECRETARY
14
<PAGE>
DEVRY INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. /X/
[ ]
<TABLE>
<CAPTION>
1. ELECTION OF DIRECTORS: FOR WITHHOLD FOR (Except Nominee(s) written below)
ALL ALL ALL
<S> <C> <C> <C> <C>
NOMINEES: CLASS III (2003) --
01-Charles A. Bowsher, / / / / / /
02-Robert C. McCormack, ----------------------------
03-Julie A. McGee, and
04-Ronald L. Taylor
FOR AGAINST ABSTAIN
2. Ratification of selection of / / / / / /
PricewaterhouseCoopers LLP as
Independent Public Accountants.
</TABLE>
Dated:______________________, 2000
Signature(s) _____________________
__________________________________
Please date and sign above exactly
as your name(s) appears hereon.
Joint owners should all sign. When
signing in a representative capacity
(such as for an estate, trust,
corporation or partnership) please
indicate title or capacity.
--------------------------------------------------------------------------------
TRIANGLE FOLD AND DETACH HERE TRIANGLE
YOUR VOTE IS IMPORTANT!
PLEASE SIGN, DATE AND RETURN PROMPTLY
IN ENCLOSED PREPAID ENVELOPE.
<PAGE>
PROXY PROXY
DEVRY INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Marilynn J. Cason and Norman M. Levine as
proxies, each with the power to act alone and with full power of substitution
and revocation, to represent and vote, as specified on the other side of this
Proxy, all shares of Common Stock of DeVRY INC. that the undersigned is
entitled to vote at the Annual Meeting of Stockholders to be held on Tuesday,
November 14, 2000 at 10:30 a.m. Central Standard Time at The Northern Trust
Company, 50 South LaSalle Street, Chicago, Illinois 60675, and all
adjournments thereof.
The shares represented by this Proxy will be voted as specified. If no choice
is specified, this Proxy will be voted FOR Proposals 1 and 2.
The proxies are authorized, in their discretion, to vote such shares upon any
other business that may properly come before the Annual Meeting.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN ENCLOSED PREPAID ENVELOPE.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
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