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PRELIMINARY COPY
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
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[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
................................OGDEN CORPORATION...............................
(Name of Registrant as Specified In Its Charter)
............................PROVIDENCE CAPITAL, INC.............................
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PRELIMINARY COPY
PROXY STATEMENT OF
PROVIDENCE CAPITAL, INC.
IN OPPOSITION TO THE BOARD OF DIRECTORS
OF OGDEN CORPORATION
------------------------------------------
OGDEN CORPORATION
Annual Meeting of Shareholders
scheduled for May 20, 1998
------------------------------------------
To our fellow shareholders of OGDEN CORPORATION:
This proxy statement is being furnished to holders
("shareholders") of Common Stock, par value $.50 per share ("Common
Stock") and $1.875 Cumulative Convertible Preferred Stock, Partially
Participating ("Series A Preferred Stock") of Ogden Corporation, a
Delaware corporation ("Ogden" or the "Company"), in connection with the
solicitation of proxies by Providence Capital, Inc. ("Providence") and
certain of its affiliates and associates (collectively, the "Soliciting
Group") for use in connection with the Company's 1998 annual meeting or
at any adjournments or postponements thereof (the "1998 Annual Meeting").
The Company's Board of Directors ("Board") has announced that the 1998
Annual Meeting will be held on May 20, 1998 at the Villas of Grand
Cypress, One North Jacaranda, Orlando, Florida at 9:00 AM, local time.
The Soliciting Group is seeking your support to elect the three
candidates Providence intends to nominate (the "Nominees" or the "Slate")
at the 1998 Annual Meeting, namely Michael G. Conroy, Larry G. Schafran
and Robert J. Slater, to Ogden's Board of Directors.
Ogden's address is Ogden Corporation, Two Pennsylvania Plaza,
New York, NY 10121.
THIS SOLICITATION IS BEING MADE BY PROVIDENCE IN OPPOSITION TO
THE INCUMBENT BOARD AND MANAGEMENT OF THE COMPANY.
Providence's definitive Proxy Statement and accompanying Gold
Proxy Card are intended to be first sent to shareholders on or about May
5, 1998.
Any questions regarding this proxy statement should be addressed
to Providence by mail at 730 Fifth Avenue, New York, NY 10019 or by
telephone (212) 888-3200 or to MacKenzie Partners Inc., 156 Fifth Avenue,
New York, NY 10016, telephone number: (212) 929-5500 or toll free: (800)
322-2885.
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IF A GOLD PROXY CARD IS PROPERLY EXECUTED AND RETURNED, THE SHARES
REPRESENTED BY THE GOLD PROXY CARD WILL BE VOTED AS THE SHAREHOLDER
SPECIFIES. IF NO DIRECTIONS ARE GIVEN AND A SIGNED GOLD PROXY CARD IS
RETURNED, THE PROXY HOLDERS APPOINTED BY PROVIDENCE IN THE PROXY WILL
VOTE THE SHARES OF COMPANY STOCK REPRESENTED BY THAT PROXY CARD (I) "FOR"
THE ELECTION OF PROVIDENCE'S NOMINEES, AND "FOR" THE ELECTION OF THE
COMPANY'S NOMINEE WHO IS NOT NAMED IN 1.B. OF THE GOLD PROXY CARD, (II)
"FOR" THE RATIFICATION OF DELOITTE & TOUCHE AS AUDITORS OF THE COMPANY,
(III) "FOR" THE SHAREHOLDER PROPOSAL IN FAVOR OF ELIMINATING THE
CLASSIFIED BOARD STRUCTURE, (IV) "AGAINST" THE SHAREHOLDER RESOLUTION
CALLING FOR THE SALE OF THE COMPANY (V) "AGAINST" THE ADOPTION OF THE
CERES PRINCIPLES AND (VI) IN THE DISCRETION OF THE PROXY HOLDER WITH
RESPECT TO ANY OTHER MATTER THAT MAY PROPERLY BE BROUGHT BEFORE THE 1998
ANNUAL MEETING.
A shareholder may revoke a proxy at any time before it is
exercised by delivering a subsequent proxy, giving written notice of the
revocation to the Secretary of Ogden, or by voting in person at the 1998
Annual Meeting. Management has stated in its proxy statement for the 1998
Annual Meeting that "such action [e.g., delivery of subsequent proxy
etc.] must be taken in sufficient time to permit the necessary
examination and tabulation of the revocation or the subsequent proxy
before the vote is taken."
Carefully review this Proxy Statement and the enclosed
materials. YOUR PROXY IS IMPORTANT. The Soliciting Group urges you to
vote FOR Providence's Nominees, FOR the ratification of Deloitte & Touche
as auditors, FOR the shareholder proposal in favor of eliminating the
Classified Board, AGAINST the shareholder proposal to sell the company
and AGAINST the shareholder proposal urging adoption of the CERES
principles. You CANNOT use the Company's Proxy Card to vote for
Providence's Nominees.
IF YOU HAVE ALREADY MAILED THE PROXY CARD SUPPLIED TO YOU BY THE
COMPANY'S BOARD OF DIRECTORS, YOU HAVE THE RIGHT TO CHANGE YOUR VOTE BY
SIGNING, DATING AND RETURNING THE ENCLOSED GOLD PROXY CARD IN THE
ENCLOSED ENVELOPE. The latest dated proxy determines your vote at the
1998 Annual Meeting.
If you own your shares in the name of a brokerage firm, bank
nominee or other institution, only they can vote your shares.
Accordingly, you should contact the person responsible for your account
and give instructions with respect to the granting of proxies. Your
broker cannot vote your shares unless he or she receives your specific
instructions.
IF YOU HAVE ANY QUESTIONS OR HAVE ANY DIFFICULTY GRANTING
PROXIES, YOU ARE INVITED TO CONTACT MACKENZIE PARTNERS AT (212) 929-
5500 OR CALL TOLL-FREE: (800) 322-2885.
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REASONS FOR THE SOLICITATION
As noted, Providence, a registered broker-dealer and stockholder of
record of Ogden intends to nominate three individuals for election to the
Board of Ogden at the 1998 Annual Meeting. Providence believes that
during the eight-year regime of the current Chief Executive Officer, R.
Richard Ablon, both the Board and senior management at Ogden have failed
to implement a consistent business strategy to deliver increased
shareholder value over the long-term. In fact, Providence believes that
the policies of the present Board and management have diminished
shareholder value over the long-term, considering the level of
profitability, earnings growth, and the absence of economic value added
to the Company relative to the capital employed.
The chart below compares Ogden's share price performance
relative to the S&P 500 Index during the past eight years under R.
Richard Ablon's leadership as Chief Executive Officer. The 11.7%
cumulative return to Ogden stockholders equates to just 1.4% compounded
annual growth for the past eight years.
[LINE GRAPH]
Ogden Stock Appreciation vs. S&P 500 Index
May 1990 - March 1998
Ogden S&P 500
----- -------
May-90 0.00% 0.00%
Jun-90 5.83% -0.89%
Sep-90 -33.01% -15.28%
Dec-90 -27.18% -8.58%
Mar-91 -22.33% 3.87%
Jun-91 -26.70% 2.75%
Sep-91 -24.76% 7.37%
Dec-91 -21.36% 15.46%
Mar-92 -13.11% 11.75%
Jun-92 -23.79% 12.99%
Sep-92 -27.18% 15.66%
Dec-92 -11.65% 20.62%
Mar-93 -5.34% 25.04%
Jun-93 1.94% 24.72%
Sep-93 -2.43% 27.05%
Dec-93 -11.65% 29.13%
Mar-94 -13.59% 23.40%
Jun-94 -14.56% 22.99%
Sep-94 -18.45% 28.09%
Dec-94 -27.18% 27.14%
Mar-95 -21.84% 38.61%
Jun-95 -15.05% 50.80%
Sep-95 -8.74% 61.78%
Dec-95 -16.99% 70.51%
Mar-96 -24.27% 78.70%
Jun-96 -29.61% 85.65%
Sep-96 -21.84% 90.27%
Dec-96 -26.21% 105.06%
Mar-97 -17.96% 109.59%
Jun-97 -15.53% 145.04%
Sep-97 -8.25% 162.24%
Dec-97 9.47% 168.65%
Mar-98 11.65% 205.00%
Source: Bloomberg.
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The compound annual growth to Ogden's share price over the last
three and five years has been 12.6% and 3.4%, respectively compared to
the S&P 500 Index which returned 30.4% and 19.5%, respectively over the
same periods. During 1997, an investment house that follows Ogden noted
that the Company has a poor track record when it comes to growing
earnings or increasing shareholder value. The chart below shows Ogden's
fully diluted earnings per share for 1990 to 1997.
[LINE GRAPH]
Ogden Fully Diluted EPS
Fiscal 1990 - Fiscal 1997
Fiscal Fully Diluted
Year Earnings Per Share
---- ------------------
1990 $1.31
1991 $1.01
1992 $1.29
1993 $1.28
1994 $1.48
1995 $0.15
1996 $1.28
1997 $1.49
Source: Ogden Annual Reports.
The compound annual growth rate of Ogden's earnings per share was
1.5% from 1990 to 1997 compared to 9.3% for the S&P 500 Index. In
Providence's view, Ogden's paltry level of growth is particularly
troublesome considering the Company's net cash used in investment activities
amounted to $18.26 per share during this period.
Providence believes that these results reflect poorly on the present
Board and management considering that growth has been a major theme of
Ogden's management since the appointment of R. Richard Ablon as CEO eight
years ago.
We are not alone in our assessment of Ogden. The Company's results
and the apparent inability of Ogden's present Board to create value for
shareholders have not escaped the press's attention. In December 1996, an
article in Crain's New York Business noted that the Company's stock price
had been stuck in a rut for half a decade. In a December 1997 Business
Week feature story on the best and worst corporate boards, Ogden's present
Board was voted by 103 of the nation's largest pension funds, money
managers and experts on corporate governance to be among the ten worst
corporate boards in America. Most recently, in March 1998, Ogden was
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cited by a Fortune Magazine article as one of six major U.S. companies who have
simply failed their shareholders.
Providence believes that Ogden's poor long-term stock price
performance and poor earnings performance demonstrate that the Company's
long-standing strategy of maintaining a disparate array of businesses
operating all over the globe has not worked. And, in our opinion, unless
certain critical changes are made with respect to management, corporate
structure, and business focus, there is little reason to believe that a
sustainable level of earnings growth may be attained.
Providence believes that within Ogden's overly broad portfolio
of predominantly unrelated businesses, there exist certain core Aviation
and Entertainment assets which have significant value and growth
potential, but whose business values are presently not being fully
realized as a result of the following factors:
1. Unfocused Operations
Ogden operates a myriad of unrelated businesses ranging
literally from "A" to "Z", for example: artist management, baggage
handling, betting parlors, waste-to-energy management, and zoological
parks. Providence believes that the range of businesses in which Ogden
operates results in a lack of focus and is beyond the capacity of the
Company to manage all at once.
While the company claims to operate in three business segments,
a closer inspection of Ogden reveals that the Entertainment division is
involved in eleven different lines of business in seven countries; the
Aviation division provides a wide variety of services and construction to
airports and has investments in four continents; and the Energy division
operates four different lines of business involving numerous types of
power generation plants on three continents.
Based on the Company's 1997 10-K report, the following is a list
of the businesses in which Ogden is currently involved:
I. Entertainment
a) Facilities management and concession services to convention
centers, arenas, and public facilities in Alaska, mainland
U.S., U.K., Australia, Mexico, Canada, Germany.
b) Food & Beverage services to stadiums, arenas, zoos, and
amphitheaters in the U.S., Australia, New Zealand, and Canada.
c) Casino operator of the Americana Beach Resort in Aruba,
Venezuela.
d) Operator of a thoroughbred racetrack and four OTB parlors in
Illinois.
e) Co-developer and operator of a 15-theater IMAX(TM) chain
(not yet developed).
f) Co-producer of large-format IMAX(TM) feature films with Sony
Corporation.
g) Recorded music and video development.
h) Concert promotion.
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i) Broadway and television production.
j) Owner/operator of the Darien Lake Performing Arts Center.
k) Owner and/or Operator of the following theme attractions:
i) American Wilderness, Zoo and Aquarium(TM).
ii) Silver Springs and Wild Waters theme parks in
Orlando, Florida.
iii) Grizzly Park entertainment center in Yellowstone
National Park.
iv) 107th Floor Observation Deck at The World Trade
Center in New York City.
v) La Rural de Palermo fair and exhibition center
in Buenos Aires, Argentina.
vi) Parques Tecnocultiroles, S.A., a manager/operator of
Isla Magic, a theme park in Seville, Spain.
vii) Tinseltown Studios(TM): 700-seat audience
participation theater on part of the Anaheim
Stadium parking lot.
viii) Jazzland: a theme park to be located in New Orleans.
ix) Enchanted Castle Family Entertainment Center in
Chicago.
II. Aviation:
a) Airport services including ground handling, aircraft
cleaning and maintenance, ramp, passenger, cargo and
warehouse, fueling and in-flight catering services
(including operations in Chile, the United Kingdom, the
Netherlands, New Zealand, Peru, Brazil, Canada,
Venezuela, Mexico, St. Maarten, Laos (in process),
Puerto Rico, Panama, and the Dominican Republic).
b) Investments in airport privatization projects in Macau,
Colombia, Argentina, and the Czech Republic.
III. Energy:
a) Waste-to-Energy ("WTE"): Lessee/Operator/Part Owner/Owner of
28 waste-to-energy projects in the U.S.
b) Independent Power: Lessee/Operator/Part Owner/Owner of
various projects using a variety of energy sources
including geothermal, coal, hydro, diesel, natural gas,
wood waste, and landfill gas in China, the Philippines,
and the U.S.
c) Water and Wastewater
i) Operates three small wastewater treatment facilities
in New York and one under development in Alabama.
ii) Recent award of a 32-year concession in the
City of Muscat, Sultanate of Oman.
d) Environmental Consulting and Engineering (Ogden is seeking
to dispose of this business).
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IV. Combat maneuver instrumentation systems: through Applied Data
Technology, Inc.
V. Contract manufacturing: through Atlantic Design Company, Inc.
2. Rapidly Changing Business Strategy
Providence also believes that the present Board and management
is constantly altering the business strategy of the Company in a manner
that hinders earnings growth. Since 1990, Ogden has exited business lines
in the fields of drug development and biomedical research, building
maintenance, asbestos abatement, telecommunications, defense and space
technology, hazardous waste, and others. Meanwhile, Ogden has entered
other businesses including independent power production, theme park
management, airport construction, wastewater treatment, air combat
maneuvering instrumentation systems, concerts, recorded music and video
development, motion picture film making, and others.
Ogden's operations now extend to such distant and diverse
countries as Laos, Romania, Bolivia, Poland, China, and the Sultanate of
Oman.
During the late 1980's and early 1990's, the Company invested
heavily in its WTE operations, which the Company now states has low-growth
potential and faces uncertainties. Currently, it appears that Ogden is pursuing
a growth strategy in two completely new lines of business: Independent Power
Construction in emerging markets, and Themed Entertainment.
Providence doubts that investors can be comfortable with Ogden's
current business strategy given the company's willingness to exit and
enter different lines of business. From Providence's perspective, the
problem is most succinctly captured by the recent Fortune Magazine
article mentioned above which said:
"The stock goes no where while the strategy goes everywhere."
(Colvin, G., Fortune Magazine, "The 1998 Don't-Get-It-All-Stars", March
30, 1998 at page 170. Providence has neither sought nor obtained the
permission of either Mr. Colvin or Fortune Magazine for the use of this
quotation.)
3. Confusing Conglomerate Structure
Providence believes that as long as Ogden maintains a
conglomerate structure of many different businesses with widely different
growth profiles, capital needs, and operating cycles, investors will have
difficulty ascertaining the true growth potential of the overall company
due to confusion in valuing multiple business segments.
Providence notes that in September 1997, a Wall Street
investment firm released a report stating that Ogden was worth $50.00 per
share. Yet the stock's average closing price over the last twelve months
has been only $24.52 per share.
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4. Reliance on Waste-to-Energy Business: No-Growth, Leveraged, and the
Dominant Operating Business.
Over the past decade, Ogden has built a large energy business
(predominantly WTE) which accounts for a major portion of the company's
assets, debt, revenues, and income.
$'s millions % Change
12/97 12/96 1996 - 1997
----- ----- -----------
Revenues
Entertainment 425.9 391.9 8.7%
Aviation 363.3 426.7 -14.9%
- ------------------------------------------------------------------------------
Energy 712.3 724.3 -1.4%
- ------------------------------------------------------------------------------
Other 248.3 488.1 -49.1%
------- -------
Total 1,749.8 2,031.0 -13.8%
Income (loss) from
Entertainment 30.5 20.3 50.2%
Aviation 34.0 14.9 128.2%
- ------------------------------------------------------------------------------
Energy 94.4 90.5 4.3%
- ------------------------------------------------------------------------------
Other 0.5 16.8 -97.0%
Corporate G&A (22.2) (22.9) -3.1%
------- -------
Total 137.2 119.6 14.7%
Source: Ogden 1997 Annual Report.
Providence believes that due to Ogden's relatively large
financial commitment to WTE, many investors focus primarily on this
segment while ignoring the growth prospects of Ogden's other businesses.
Ogden's consolidated income from operations grew 14.7% in 1997, although
net of the Energy segment, the percentage increase was 47.4%.
Providence believes that given the large contribution of the
Energy segment to the Company's consolidated results (a segment that the
Company itself believes is not likely to grow significantly), it will be
difficult for Ogden's overall consolidated results to grow substantially.
In addition, the $1.5 billion of project debt associated with
the WTE business makes Ogden's balance sheet appear highly leveraged,
even though a majority of the project debt is non-recourse to the
Company.
The WTE business, according to management, accounted for 94% of
total income from the Energy segment in 1997. Management anticipates that
WTE will show little to no growth in the near future due to a largely
matured domestic market and scarce opportunities for new projects. This
is a monumental shift in the Company's outlook, considering that in the
1993 Annual Report, management defended its investment in WTE by citing
EPA statistics which predicted that by 1999, America
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would be combusting 21% of its waste in WTE facilities. Providence
believes that this estimate will prove to be grossly optimistic.
In Providence's view, Ogden's Board has built a conglomerate
structure with its primary business segment consisting of a leveraged,
low growth, cyclical operation which is potentially vulnerable to rapid
industry changes. From Providence's perspective, Ogden's earlier
strategic plan to become the largest operator of WTE facilities in the
world has hurt shareholder value because now, as Ogden's management
itself admits, this dominant division has a weak outlook.
5. Capital Misallocation
In Providence's view, Ogden's management has an abysmal track
record of allocating capital wisely. From 1990 to 1997, the Company
spent a net $926 million, or $18.26 per share, on investing activities.
What does the Company have to show for this investment? Earnings per
share in 1997 were 10% below 1989; book value per common share has risen
only 2.6% in the last eight years; and Ogden's stock price declined 11.6%
from December 31, 1989 to December 31, 1997! By these three measures, it
appears to Providence that no value has been added from the $18.26 per
share of investments made by the Board and management over the past eight
years. Providence believes that this track record is a signal that
Ogden's capital allocation policies must change.
In addition to investment activities, a major use of capital has
been the dividend. Ogden has expressed a firm commitment to the
continuation of a significant dividend pay-out. Over the past eight
years, dividends to common shareholders have totaled $10.00 per share,
which exceeds the cumulative fully diluted earnings of $9.29 per share
over this period. In 1997, the pay-out ratio was equal to 84%. Providence
finds the dividend pay-out ratio unsustainable and fundamentally
inconsistent with Ogden's plans to produce significant year-on-year
earnings growth.
Recent changes in the U.S. tax code favoring long term capital
gains reinforce our view that dividends are a less effective way of
returning value to individual shareholders than allocating capital to
share repurchases. Ogden's average dividend yield over the past eight
years has been a generous 5.7% compared to an average of 2.5% for the
companies in the S&P 500.
Providence believes that Ogden's use of its own common stock to
finance acquisitions also deserves criticism. In December 1994 Ogden
issued 5.1 million common shares at $18.375 per share to purchase a
minority interest in Ogden Projects, Inc. This acquisition for stock was
made when Ogden's stock was trading just 3.5% above its four-year low.
In contrast, the management has not implemented the repurchase
of any Ogden stock, even though in 1990 a two million share repurchase
program was authorized by the Board. A token member of 50,000 shares was
purchased in February 1998 pursuant
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to a $100 million share repurchase plan authorized in January 1998
primarily to offset the exercise of stock options.
Providence questions the Board's capital allocation decision
process when it authorizes a large dividend pay-out while promising
growth in operations, and uses its stock, trading at historic lows, to
finance acquisitions while refusing to follow through on a share
repurchase program.
6. Faltering Management
Mr. Ralph Ablon, father of Ogden's present CEO, was CEO from 1962 to
1990. Between the father and son, the two Ablons have run Ogden for the past 36
years.
During Mr. Ralph Ablon's 28-year term, Ogden shares appreciated
1,862% compared with 460% for the S&P 500 Index. In May 1990, R. Richard
Ablon replaced his father. Since R. Richard Ablon's appointment as CEO,
Ogden's shares have risen 11.7% compared to 205.0% for the S&P 500 Index.
In our judgment, since taking over the CEO position, R. Richard Ablon has
not significantly improved Ogden's bottom line or share price.
Given these results, R. Richard Ablon's leadership of Ogden has
not inspired confidence on Wall Street. A recent investment report issued
by New York-based investment firm expressed the view that Ogden lacked
credibility on Wall Street, in part because of the performance of the
Company's stock price and in part because a son (R. Richard Ablon) succeeded his
father in office.
In Providence's opinion, the selection of R. Richard Ablon as
CEO has proven to be the wrong decision over the long term.
7. Management By Committee
In Providence's view, the Board of Ogden has created an excessively
complicated and expensive committee structure.
Consider that 6 out of the 14 present Directors serve on Ogden's
"Management Committee" of the Board. The Management Committee's principal
functions are to:
"review and evaluate Ogden's strategies, plans, policies and management
needed to meet long-range goals and objectives, . . . evaluating and
reviewing business transactions under consideration by management,
Ogden's financial status, current financial arrangements, current and
anticipated financial requirements and issuance and sale of Ogden
securities and advising and recommending to the Board of Directors with
respect thereto."
Providence asks: Isn't all of this what the Board is supposed to be doing?
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In Providence's opinion this "Management Committee"
unnecessarily duplicates the whole Board, resulting in unnecessary
additional Directors' fees and expenses. The Board also has Compensation,
Audit, Technology, and Governance Committees on which there are
collectively another 14 Director seats. In sum, Ogden has 20 committee
seats plus 14 board seats for a total of 34 Director/committee seats.
Each non-employee director of Ogden receives an annual fee of
$9,000 for serving on the Board, and, another $12,000 annually for
serving on each committee, $1,500 for each of committee meeting attended,
$1,500 for each Board meeting attended, and $500 for each day spent away
from the director's city of residence on special director activities.
Assuming the Governance Committee meets three times in 1998 (the lowest
number of meetings for any Ogden committee in 1997) and the other
committees and the Board meet as many times as they did in 1997, Ogden's
fees in 1998 to non-employee directors (all but R. Richard Ablon) could
total $682,500. This figure is an average of $52,500 per non-employee
director, not including travel expenses.
In Providence's view, Ogden has too many director seats and too
many committees that are costing the Company too much money, particularly
in light of what, in our opinion, is an unsatisfactory performance over
the past eight years.
8. Directors' Lack of Public Company Management
Ogden's present Board members include six university professors,
one education specialist, one president of a policy think-tank and one
lawyer.
The following chart shows the Ogden directors whose terms
continue after the 1998 Annual Meeting and the four nominees proposed for
election by management. Providence believes that a more successful Board
would include a larger number of directors who have held senior
managerial leadership positions, particularly at publicly-held companies.
We believe that the members of our slate -- Robert Slater (formerly President
and Vice Chairman of Crane Company); Larry G. Schafran (Chairman of the Board of
Delta-Omega Technologies and former Chairman of the Executive Committee of Dart
Group); and Michael G. Conroy (former President of the International Herald
Tribune) -- would enhance the Board's ability to develop and implement
strategies to increase shareholder value.
OGDEN Director Age Professional Occupation
- -------------- --- -----------------------
R. Richard Ablon 48 Chairman and CEO
David M. Abshire 71 President, Center for Strategic and
Int'l Studies
Anthony J. Bolland 45 Venture Capitalist
Norman G. Einspruch 65 Professor, University of Miami
Jeffrey F. Friedman 51 Investment Manager
Attallah Kappas 71 Professor, Rockefeller University
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Terry Allen Kramer 64 Venture Capitalist
Judith Moyers 62 Education Specialist
Homer A. Neal 55 Professor, University of Michigan
Robert E. Smith 62 Lawyer
Helmut Volcker 64 Professor, University of Essen
Source: Ogden 1998 Proxy Statement.
9. Shareholder-Hostile Corporate Governance
Providence also believes that certain elements of the Company's
governance structure that have been adopted by the Board are contrary to
the best interests of shareholders.
For example, Ogden's Board is classified. This prevents
shareholders from electing all directors annually. Dr. Charles Miller, an
Ogden shareholder, proposed at Ogden's 1997 Annual Meeting that the Board
take the necessary steps to declassify its structure so that all
directors would be elected annually. Providence agrees with Dr. Miller's
assertion that "the election of directors is the primary avenue for
stockholders to influence corporate governance policies and to hold
management accountable for its implementation of those policies." Ogden
shareholders agreed with Dr. Miller by passing this resolution with 22.8
million shares "For" and only 14.4 million shares "Against". Despite this
61.3% plurality, Ogden's Board rejected the shareholder resolution. This
year, another Ogden shareholder, Mr. William Steiner, has proposed that
the classified Board be eliminated. Providence supports this proposal
and, unless otherwise instructed to the contrary, will vote all proxies
it receives in favor of Mr.
Steiner's proposal.
In addition to the classified Board, Ogden has also put in place
other measures which may serve to entrench management. These include a
Shareholders Rights Plan, established in September 1990, which provides
that "rights" are exercisable after a party acquires or makes a tender
offer to acquire, 15% or more of the Corporation's common stock.
Under a stock option plan adopted in 1990, Ogden began granting
limited stock appreciation rights ("LSARs") to management and the Board.
These rights are exercisable only in the event of the acquisition of 20%
of the stock by any person, or the approval of shareholders to sell or
merge the Company, or certain changes in the membership of the Board. As
of December 1997, there were 4,549,500 LSARs outstanding, representing
9.0% of the current common shares outstanding.
In Providence's view, each of these measures, the Classified
Board, the Rights Plan, and the LSARs, have the effect of making an
acquisition of Ogden more difficult and more expensive and, as a result,
have a tendency to shield the current management and Board. The
shareholders of Ogden would be better served, in Providence's opinion,
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<PAGE>
by the elimination of these devices. In our view, the only "defense" that
should be available to Ogden's Board and management team is excellent
performance in managing and operating the Company.
Lastly, Providence also believes that the way in which executive
compensation decisions are made, particularly with regard to the
Company's chief executive officer, have not been "shareholder-friendly".
According to the Company's proxy statements, R. Richard Ablon's bonus is
determined strictly on the basis of "Pre-tax Return on Equity" - earnings
growth and shareholder returns are not considered. Consequently, under
this bonus formula, if Ogden's 1998 pre-tax income is unchanged from 1997, R.
Richard Ablon would still receive a bonus equal to 125% of his base salary.
Moreover, he will still receive a bonus of 75% of his base salary even if
pre-tax income declines by as much as 44%.
In 1996, R. Richard Ablon's compensation was in the 75th
percentile of total direct compensation for companies with revenues under
$3.0 billion, the same year in which Ogden's stock price fell by 11.1%.
Although the performance of the Company's stock price was significantly
better in 1997, in Providence's view Ogden's overall financial
performance (including its stock price) has not been strong enough over
the past eight years to justify annual compensation to Mr. Ablon (and the
four other most highly compensated officers of Ogden) that is presently
in the 75th percentile of total direct compensation by companies with
comparable revenues.
10. Expenses/General Administration
Ogden's corporate general and administrative expenses which
totaled $12.6 million (net of charges) in 1990 ballooned to $22.2 million
in 1997, an increase of 76.2%. Over the same period, however, the
Company's revenues only increased 12.4%. Why there should be such a
disparity between the percentage increase in revenue and the percentage
increase in corporate general and administrative expenses is not
immediately clear. Providence suggests that an audit of Ogden's corporate
general and administrative expenses as well as the general and
administrative expenses of each business unit is in order to determine,
for example, whether (and to what extent) overhead costs have been
duplicated as a result of the Company's conglomerate structure and
multiple lines of business.
* * * * *
Over the past several weeks, representatives of Providence have
been in contact with the Board and management of the Company, including
R. Richard Ablon, about Providence's concerns. At the Company's request
and for the purpose of reaching an understanding with the Company on how
Providence's issues could be addressed without a contested election,
Providence submitted a proposal regarding (i) corporate structure, (ii)
business strategies, (iii) capital allocation policies, (iv) corporate
governance issues, (v) the composition of the Board and Board committees
and (vi)
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<PAGE>
Providence's role as an advisor to Ogden. In response to Providence's
proposal, the Company could only commit to (i) reimbursing Providence for
Providence's legal and other expenses incurred in connection with its
efforts with respect to Ogden, and (ii) issuing a press release stating
Ogden's intention to intensify its efforts to grow the Company's
earnings. In Providence's view, Ogden's offer was unresponsive and failed
to address the critical issues contained in Providence's proposal.
Providence's Accelerated Plan for Earnings Growth
Providence's three director Nominees have had substantial
business and public board experience. If elected, our Nominees will seek
to foster changes to improve Ogden's growth and business values. More
specifically, Providence's director Nominees will ask that the Board seek
to:
1. Focus Ogden's Business Operations
Our Nominees will suggest that the management of Ogden analyze each
line of business and rank it according to potential for
profitability and earnings growth. Once this analysis is complete,
our nominees may recommend that the operations which represent the
least opportunity for profit and growth should be sold.
2. Simplify Ogden's Corporate Structure
Our Nominees will suggest that the Company explore ways to simplify
its corporate structure, including the sale or spin-off of one or
more of its three main business segments. Providence believes that
each of the three segments has sufficient revenues and profits to
operate as an independently traded company.
In particular, Providence believes that the sale or spin-off of the
WTE business would address Ogden's balance sheet issues and allow
shareholders to participate in a company more focused upon its
growing Entertainment and Aviation units.
3. Improve Capital Allocation
Providence believes the Company needs to review the dividend pay-out
ratio with a view to implementing a strategy for funding
growth and a significant share repurchase program. Providence
believes, for example, that Ogden could finance a share repurchase
of 20% of Ogden's outstanding common shares while still retaining
sufficient cash flow to finance the growth of its Entertainment and
Aviation businesses.
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<PAGE>
4. Recruit New Chairman and Chief Executive Officer
Providence believes a new Chairman and Chief Executive Officer are
required to execute this revised business plan. In Providence's
opinion, the current Chief Executive Officer has had eight years
without achieving satisfactory results.
5. Reconstitute the Board
In Providence's opinion, the Board needs vigorous directors with
substantial business and public board experience. Providence is
confident that its Nominees have these attributes.
6. Corporate Governance
Our Nominees will propose that the Ogden Board be declassified and
the Shareholders Rights Plan be eliminated. Our Nominees are also
committed to proposing changes to director and officer compensation
that more directly align the economic interests of directors and
officers in the Company with those of the shareholders.
7. Expenses
The individuals nominated by Providence will, if elected, propose
that the Audit Committee of the Board immediately review the
corporate general and administrative expenses of the Company as a
whole and each of its business units in order to report to the whole
Board as to why the growth in these expenditures has far outstripped
the growth in revenues and to recommend tangible measures to address
this growth in expense.
* * * * *
Providence is confident that the implementation of these seven steps would
help stimulate Ogden's earnings per share growth and provide Ogden shareholders
with a better chance of improving return on their investment than the Company's
present strategy.
Providence is asking you to elect its three Nominees:
Michael G. Conroy, age 59, was formerly President of The International
Herald Tribune, U.S., a large international newspaper publishing
organization. Mr. Conroy has 26 years of business experience in sales,
marketing, manufacturing, and distribution and has worked extensively in
Europe, the Middle East, and Africa. He is a director of Great Bear Paper
Company, L.L.C.
-15-
<PAGE>
Larry G. Schafran, age 59, is a managing general partner of a real estate
investment and development firm. He is Chairman of the Board of
Delta-Omega Technologies, Inc., a specialty chemicals and industrial
cleaners and degreasers. He is the former Chairman of the Executive
Committee of Dart Group Corporation, a company with interests in various
retail and distribution businesses.
Robert J. Slater, age 60, is a management consultant and was formerly President
and Vice Chairman of Crane Company, a $1.5 billion multinational manufacturing
and distribution company. Mr. Slater was also CEO of Medusa Cement Company. Mr.
Slater has been a director of seven public companies and currently serves on the
boards of Southdown, Inc. (NYSE: SDW), a domestic cement manufacturer and First
Industrial Realty Trust (NYSE: FR), a real estate investment trust with 226
properties.
* * * * *
If elected, Providence's Nominees would be a minority on Ogden's
Board, and there is no assurance that the continuing Board members would support
all or any portion of Providence's plan for earnings growth. Providence
believes, however, that its Nominees would be able to effectively articulate the
need for change to the other members of the Board. Providence also believes that
in the event its Nominees are elected, the continuing members of the Board may
perceive the election of the Nominees as indicative of shareholder support for
Providence's views and may then favorably consider Providence's plan for
earnings growth.
Summary
In our judgment, Ogden's current leadership has not provided
shareholders with adequate returns over the past eight years. The share
price has grown at a compound annual rate of 1.4% from the point at which
R. Richard Ablon was appointed Chief Executive Officer. The Company
continues to maintain a conglomerate structure with ever-changing
business strategies which Providence believes confuses shareholders and
prevents the values of its stronger growth businesses from being realized
in the stock market. Over the past decade, the Company, under R. Richard
Ablon's direction, created a WTE business the Company now admits is a "no
growth" business and that may be at risk in a deregulated domestic
utility industry.
In our opinion, Ogden has had a Board that has been
well-compensated for unsatisfactory results - a Board that refused to act
in accordance with the wishes of its shareholders when, by an
overwhelming margin, the shareholders requested the directors to
eliminate the classified Board structure and reinstate the annual
election of directors.
In deciding how to vote, Providence asks the shareholders of
Ogden to consider whether the present Board of the Company has worked
hard enough for them and whether the present Board has been responsive
to its shareholders.
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<PAGE>
The three independent nominees which Providence has submitted
for election to the Board are committed to taking responsible actions
that would allow Ogden to accomplish its mission of increasing long term
shareholder value. For this reason, Providence respectfully requests the
support of Ogden shareholders in electing Robert J. Slater, Lawrence G.
Schafran and Michael G. Conroy to the Board of Ogden.
-17-
<PAGE>
BACKGROUND OF PROVIDENCE'S NOMINEES
The Soliciting Group is soliciting proxies in favor of the
election of the three nominees listed below to Ogden's Board of
Directors. Each of the Soliciting Group's Nominees has consented to serve
as director of the Company if elected, and each intends to discharge his
duties as a director of Ogden in compliance with all applicable legal
requirements, including the general fiduciary obligations imposed upon
directors of a Delaware corporation. There are no arrangements or
understandings between any Nominee and any other person pursuant to which
he was selected to serve as a Nominee. Additional information regarding
each Nominee is provided in Appendix A.
Present Principal Occupation
Name and Address Age Employment History; Directorships
- ---------------- --- ---------------------------------
Michael G. Conroy 59 Retired executive (1997 - present),
International Herald Tribune former President, International
850 3rd Avenue, 10th Floor Herald Tribune, U.S., Inc., a
New York, NY 10022 newspaper publishing company
(1985- 1997).
Directorships:
Bear Island Paper Company, L.L.C.
Larry G. Schafran 59 Managing General Partner, OG Schafran
OG Schafran & Associates & Associates, a real estate investment
54 Riverside Drive and development firm. (1984 - Present).
Apt. 14B Chairman of the Executive Committee,
New York, NY 10024 Dart Group Corporation, a company with
interests in the discount automotive
parts and accessories business, discount
bookstores and supermarket and wine and
beer businesses (1994-1997).
Directorships:
COMSAT Corporation
Delta-Omega Technologies, Inc.
(Chairman)Discovery Zone, Inc.
Kasper A.S.L., Ltd. (Compensation
Committee and Audit Committee member),
National Income Realty Trust (trustee)
Publicker Industries, Inc.
(Compensation Committee and Audit
Committee Chairman member)
-18-
<PAGE>
Robert J. Slater 60 President, Jackson Consulting, a private
Jackson Consulting consulting company specializing in
27 Wahackme Rd. advising basic industries (1988-
New Canaan, CT 06840 present); formerly President and
Vice-Chairman of Crane Company
Directorships:
Southdown, Inc. (Member of the
Compensation, Audit, and Finance
Committees).
First Industrial Realty Trust, Inc.
QUORUM REQUIREMENTS AND VOTING RIGHTS
According to management's proxy statement, shareholders of
record of the Company's Common Stock and Series A Preferred Stock at the
close of business on April 7, 1998, the record date established by the
Company for its 1998 Annual Meeting are entitled to vote at the 1998
Annual Meeting in person or by proxy. Each share of Common Stock is
entitled to one vote and each share of Series A Preferred Stock is
entitled to one-half vote on matters to come before the 1998 Annual
Meeting, including the election of directors. The presence in person or
by proxy of the holders of a majority of the stock having voting power
constitutes a quorum for the 1998 Annual Meeting.
In order to be elected as a director, a nominee for election to
Ogden's Board must receive a plurality of the votes cast. With respect to
the election of directors, only shares that are voted in favor of a
particular nominee will be counted towards the necessary plurality; where
a shareholder properly withholds authority to vote for a particular
nominee such shares will not be counted towards such nominee's (or any
other nominee's) vote total.
With the four nominees of the Company and the three Providence
Nominees, there will be seven nominees for four seats on the Company's
Board, and the four nominees who receive the greatest number of votes
will be elected. Shareholders who use the Gold Proxy Card furnished by
Providence will be able to vote for the three Providence Nominees and one
of the Company's nominees. The three Company nominees with respect to
whom Providence is not seeking authority to vote are R. Richard Ablon,
Judith D. Moyers, and Robert E. Smith. Shareholders cannot vote for any
of Providence's Nominees and also vote for one or more of the Company's
nominees using the Company's proxy card. Any shareholder who wishes to
vote for one or more of Providence's nominees and for any or all of R.
Richard Ablon, Judith D. Moyers, and Robert E. Smith will be required to
vote by ballot at the 1998 Annual Meeting. Shareholders should refer to
the Company's proxy statement for information concerning the Company's
nominees. There is no assurance that any of the Company's nominees will
serve as directors if any of Providence's nominees are elected to the
Company's Board.
Each other proposal submitted to the shareholders requires the
affirmative vote of the holders of a majority of the votes present at the
1998 Annual Meeting, in person or by proxy, and entitled to vote. With
respect to these other proposals: (i) if a shareholder abstains from
voting on
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<PAGE>
a proposal, such shares are considered present at the meeting for such
proposal but, since they are not affirmative votes for the proposal, they
will have the same effect as votes cast against the proposal; and (ii)
shares registered in the names of brokers or other "street name" nominees
for which proxies are voted on some but not all matters will be
considered to be voted only as to those matters actually voted and will
not have the effect of either an affirmative or negative vote on matters
as to which the broker does not have authority to vote and a beneficial
holder has not provided voting instructions (i.e., "broker non-votes").
As noted above, shares represented by signed Gold Proxy Cards
will be voted for Providence's three named Nominees unless the proxy is
otherwise marked. If any of these Nominees becomes unavailable for
election, which is not currently anticipated, shares represented by the
Gold Proxy Cards in the form to be distributed with the Soliciting
Group's definitive Proxy Statement will be voted at the discretion of the
proxy holders.
CHANGE OF CONTROL AND TERMINATION
OF EMPLOYMENT ARRANGEMENTS
According to management's proxy statement for the 1998 Annual
Meeting the Company's Stock Option Plans, as amended, permit the grant of
limited stock appreciation rights ("LSARs") in tandem with the grant of
stock option awards. The LSARs granted under the Company's plans are only
exercisable during a 90 day period following the occurrence of a "Change
of Control" (as defined in each stock option agreement). Providence does
not believe, based upon its review of the Company's 1990 Stock Option
Plan, that the election of its three Nominees to the Board would
constitute a change of control that would result in the LSARs becoming
exercisable.
R. Richard Ablon has an employment agreement with Ogden pursuant
to which he is employed by Ogden as its President and Chief Executive
Officer. If Mr. Ablon's employment is terminated by Ogden or if Mr. Ablon
terminates his employment for good reason (as described in his
agreement), then Mr. Ablon would be entitled to a cash payment equal to
five times the average of his salary and bonus paid during the term of
this agreement. Under this agreement any change in Mr. Ablon's status,
title or position as an officer of the Company that, in the reasonable
judgment of Mr. Ablon, represents a diminution of his status, title or
position would constitute good reason for which he may terminate his
employment and collect this cash payment from the Company.
Providence's Nominees have committed, if elected, to seek a new chief
executive officer for Ogden in place of Mr. Ablon. As noted, if elected
Providence's Nominees will constitute a minority of the members of the Board
and would not, without the concurrence of other Board members, be able to
remove Mr. Ablon.
Reference is made to Management's proxy statement for the 1998
Annual Meeting for further information concerning the LSARs and Mr.
Ablon's employment arrangements.
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<PAGE>
OTHER MATTERS
In addition to the proposal for the election of directors, four
other proposals have been submitted for the consideration of shareholders
at the 1998 Annual Meeting, according to management's proxy statement.
The Soliciting Group recommends that the shareholders of the Company vote
in the following manner with respect to each of these additional
proposals:
Proposal 2 - Ratification of Auditors
Providence has no objection to the appointment of Deloitte &
Touche LLP ("Deloitte") as auditors of the Company and its subsidiaries
for the Fiscal Year 1998. Therefore, the Soliciting Group suggests that
you vote FOR Proposal 2 and the ratification of Deloitte as the Company's
auditors.
Proposal 3 - Elimination of Classified Board Structure
Last year the shareholders of Ogden overwhelmingly cast their
votes in favor of a shareholder resolution urging the elimination of the
classified structure of the Company's Board. Because the Company has
failed to act in accordance with the wishes of its shareholders, the
issue has been re-proposed for consideration at the 1998 Annual Meeting.
Providence favors the annual election of all directors so that
shareholders may, each year, express their full satisfaction with or
disapproval of each of the members of the Board.
As noted above, Providence's Nominees have committed to ask the
Board to abolish the classified board structure.
The Soliciting Group strongly urges you to vote FOR Proposal 3
to recommend declassifying the Board.
Proposal 4 - Sale of Ogden
Providence believes that this shareholder-proposed resolution to
urge the Board to sell the Company promptly to the highest bidder
reflects shareholder frustration with the Company's performance.
Providence sympathizes with these frustrations but disagrees with the
specific proposal. As discussed above, Providence is of the view that
more focus is needed on the Company's Aviation and Entertainment
businesses and that the Waste to Energy business should be sold or spun
off. The Soliciting Group recommends that you vote AGAINST Proposal 4.
Proposal 5 - Adoption of CERES Principles Resolution
Because Providence has not independently examined the costs
associated with the adoption of the CERES Principles, we are assuming
management's judgement (as expressed in its proxy statement) that
adoption would result in "costly, additional reporting requirements on
Ogden which are not imposed by law" is correct and that, therefore, the
adoption of the CERES Principles would not be in the best interests of
shareholders.
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<PAGE>
The Soliciting Group recommends that you vote AGAINST Proposal 5.
CERTAIN INFORMATION CONCERNING PROVIDENCE AND OTHER PARTICIPANTS
IN THE SOLICITATION; EXPENSES OF SOLICITATION
Providence is a New York City based registered broker-dealer
with special expertise in corporate governance and shareholder matters.
Providence was founded in 1990 by Herbert A. Denton, its President, Chief
Executive Officer and sole director. Two other employees of Providence,
William Tapert and Adam Weiss, are participants in this solicitation.
Gregory M. Morey a managing member of Providence Investors, LLC
("Providence Investors"), a private investment fund of which Mr. Denton
is also a managing member, will also participate in the solicitation.
Pacific Equity Limited ("Pacific Equity"), a Hong Kong company
of which Mr. Denton is the sole managing director has orally agreed to
contribute to payment of the expenses of the solicitation.
Additional information with respect to Providence, Pacific
Equity and Messrs. Denton, Tapert, Weiss and Morey is provided in
Appendix A.
Executed proxies will be solicited by mail, telephone, facsimile/
telecopier and in person. Solicitations will be made by Mr. Denton, Mr. Tapert,
Mr. Weiss and Mr. Morey. None of the foregoing individuals will receive
additional compensation for making solicitations. Proxies will be solicited
from individuals, brokers, banks, bank nominees and other institutional
holders. The Soliciting Group has requested banks, brokerage houses and other
custodians, nominees and fiduciaries to forward all solicitation materials to
the beneficial owners of the shares they hold of record. Providence will
reimburse these record holders for their reasonable out-of-pocket expenses.
The Soliciting Group has also retained Mackenzie Partners as
information agent and to solicit proxies in connection with the 1998
Annual Meeting, for which services MacKenzie Partners will be paid a fee
to be agreed, in an amount not to exceed $50,000 and will be reimbursed
for its reasonable expenses. MacKenzie Partners will employ approximately
15 people in its efforts on behalf of the Soliciting Group. The costs of
this solicitation include printing, postage, legal and related expenses
are expected to be approximately $300,000. The total costs incurred to
date in connection with this solicitation are not in excess of
approximately $80,000. Providence and Pacific Equity will bear the costs
of the solicitation. Providence intends to ask the Board to have the
Company reimburse Providence and Pacific Equity for the costs and
expenses incurred in connection with this solicitation. Providence does
not intend to request that its reimbursement request be submitted to a
vote of shareholders.
Reference is made to management's proxy statement for the 1998
Annual Meeting, for information concerning the following: (i) the
Company's Common Stock and Series A Preferred Stock, (ii) beneficial
ownership of Common Stock and Series A Preferred Stock by management
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<PAGE>
and holders of more than 5% of a class of voting equity securities, (iii)
the Company's management, present directors and board-endorsed nominees,
(iv) Board committees, (v) independent public accountants, (vi) the
number of shares of voting securities of the Company presently
outstanding, and (vii) procedures for submitting proposals for
consideration at the Company's 1999 Annual Meeting.
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<PAGE>
APPENDIX A
ADDITIONAL INFORMATION REGARDING THE NOMINEES
Current ownership interests in securities of the Company of the Nominees and
their Associates
Below are the shareholdings and purchases and sales of shares in Ogden during
the past two years of each of the Nominees (unless otherwise indicated, each
Nominee has sole voting and investment power in respect of the indicated
shares):
<TABLE>
<CAPTION>
Purchases and Sales
Name of Nominee Number and Class of Shares Owned in the past two years
- --------------- -------------------------------- ---------------------
<S> <C> <C>
Michael G. Conroy None N/A
Larry G. Schafran None N/A
Robert J. Slater 1,000 shares of Common Stock 3/19/98 Purchase 1,000
shares
</TABLE>
None of the associates of any of the Nominees owns any securities of the
Company, other than the indirect interest of Lynn Hecht Schafran, the
wife of Larry G. Schafran, in the 30,000 shares of Common Stock of the
Company owned directly by Providence Investors. Ms. Schafran, whose
address is 54 Riverside Drive, New York, N.Y. 10024, has a less than 2%
interest in Providence Investors.
Nominee ownership of securities of parents or subsidiaries of the Company
None.
Securities of the Company owned by Nominees of record, but not beneficially
None.
Other Information
None of the Nominees has been involved in any legal proceeding
of the type required to be disclosed in response to instruction 4 to Item
103 of Regulation S-K, Item 401(f) of Regulation S-K or Item 5(b)(iii) of
Schedule 14A. None of the Nominees or any of their associates have been
engaged in any transactions or similar series of transactions that would
be required to be disclosed in response to Item 404(a) of Regulation S-K.
None of the Nominees has or has had any business relationships that would
be required to be disclosed in response to Item 404(b) of Regulation S-K.
None of the Nominees (or any related party of a Nominee of the type
specified in clauses (3), (4) or (5) of Item 404(c) of Regulation S-K)
has any indebtedness that would be required to be disclosed in response
to Item 404(c) of Regulation S-K. Item 405 of Regulation S-K is not
applicable to any of the Nominees.
<PAGE>
There are no arrangements or understandings between any
participant or any other person and any of the Nominees pursuant to which
the nominations are being made.
None of the Nominees and, to the knowledge of Providence, none
of the associates of any Nominee, has any arrangement or understanding
with any person with respect to any future employment by the Company or
its affiliates or with respect to any future transactions to which Ogden
or any of its affiliates will or may be a party.
None of the Nominees is, or was during the past year, a party to
any contract, arrangement or understanding with any person with respect
to any securities of the Company.
Each of the Nominees is a citizen of the United States.
ADDITIONAL INFORMATION REGARDING OTHER PARTICIPANTS*
Name, principal occupation or business, business address
Providence Capital, Inc.
Broker-Dealer Firm
730 Fifth Avenue, Suite 2102
New York, NY 10019
Herbert A. Denton
President, Chief Executive Officer
Providence Capital, Inc.
730 Fifth Avenue, Suite 2102
New York, NY 10019
William Tapert
Managing Director
Providence Capital Inc.
730 Fifth Avenue, Suite 2102
New York, NY 10019
- --------
* The information under the heading "Additional Information
Regarding Other Participants" in this Appendix A relates only to
participants in this solicitation other than the Nominees.
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<PAGE>
Adam Weiss
Vice President
Providence Capital Inc.
730 Fifth Avenue, Suite 2102
New York, NY 10019
Gregory Morey
Managing Member
Providence Investors, LLC
730 Fifth Avenue, Suite 2102
New York, NY 10019
Pacific Equity Limited
Investments in securities
12th Floor
Dina House
Duddell Street
Hong Kong
Current ownership interests in securities of the Company of the participants
and their associates
Below are the shareholdings and purchases and sales of shares in Ogden
during the past two years of each of the participants (unless otherwise
indicated, each participant has sole voting and investment power in
respect of the indicated shares):
<TABLE>
<CAPTION>
Purchases and Sales
Name of Participant Number and Class of Shares Owned in the past two years
- -------------------- -------------------------------- ---------------------
<S> <C> <C>
Providence Capital, Inc. 10,000 shares of Common Stock 3/23/98 Purchase 2,000 shares
3/27/98 Purchase 3,000 shares
4/8/98 Purchase 2,000 shares
4/13/98 Purchase 1,000 shares
4/22/98 Purchase 2,000 shares
</TABLE>
-iii-
<PAGE>
<TABLE>
<S> <C> <C>
Herbert A. Denton 40,000 shares of Common Stock Transactions by
(10,000 shares through Providence, Providence: (See above)
as to which Mr. Denton has sole
voting and investment power and Transactions by
30,000 shares through Providence Providence Investors:
Investors as to which Mr. Denton 3/9/98 Purchase 5,000 shares
shares voting and investment power 3/16/98 Purchase 8,000 shares
with Mr. Morey as a managing 3/18/98 Purchase 7,000 shares
member of Providence Investors) 4/3/98 Purchase 10,000 shares
Gregory M. Morey 30,000 shares of Common Stock Transactions by
(through Providence Investors as to Providence Investors:
which Mr. Morey shares voting and (See above)
investment power with Mr. Denton
as a managing member of
Providence Investors)
</TABLE>
Set forth below with respect to each associate of a participant who owns
any securities of the Company are such associate's name, address and the
form of ownership and number and class of shares of the Company owned
(directly or indirectly) by such associate.
Form of Ownership; Number
Name, Relationship and Address and Class of Shares Owned
Providence Investors, LLC (Private Direct; 30,000 shares of Common Stock
investment fund of which Messrs.
Denton and Morey are the sole
managing members)
730 Fifth Avenue
New York, N.Y. 10019
Participant ownership of securities of parents or subsidiaries of the Company
None.
Securities of the Company owned by participants of record, but not beneficially
None.
-iv-
<PAGE>
Other Information
None of the participants has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) during
the past ten years.
None of the participants is, or was within the past year, a party
to any contract, arrangements or understanding with any person with
respect to any securities of the registrant.
None of the participants or any of their associates has been
engaged in any transactions or similar series of transactions that would
be required to be disclosed in response to Item 404(a) of Regulation S-K.
None of the participants and, to the knowledge of Providence,
none of the associates of any participant, has any arrangement or
understanding with respect to any future employment by the Company or its
affiliates or with respect to any future transactions to which Ogden or
any of its affiliates will or may be a party.
As of April 20, 1998, Providence had margin indebtedness of
$119,264 attributable, in part, to the 10,000 shares of Common Stock of
the Company owned by Providence.
-v-
<PAGE>
PRELIMINARY COPY
COMMON
THIS PROXY IS SOLICITED IN OPPOSITION
TO THE INCUMBENT BOARD OF DIRECTORS
AND MANAGEMENT OF THE COMPANY IN CONNECTION WITH
THE 1998 ANNUAL MEETING OF STOCKHOLDERS OF:
OGDEN CORPORATION
The undersigned shareholder of OGDEN CORPORATION (the "Company")
hereby appoints each of Herbert A. Denton and William Tapert as lawful
attorney and proxy, each with full power of substitution, for and in the
name of the undersigned to represent and vote, as designated below, all
shares of the common stock, par value $.50 per share, of the Company
which the undersigned is entitled to vote at the 1998 annual meeting of
shareholders of the Company, to be held on May 20, 1998 at the Villas of
Grand Cypress, One North Jacaranda, Orlando, Florida commencing at 9:00
a.m., or at any adjournment, postponement or rescheduling thereof
(collectively, the "Annual Meeting"). The undersigned hereby revokes any
and all previous proxies with respect to the matters covered by this
proxy and the voting of such shares at the Annual Meeting.
1. ELECTION OF DIRECTORS ("Proposal 1"):
A. Nominees of Providence Capital, Inc. ("Providence").
MICHAEL G. CONROY, LARRY G. SCHAFRAN and ROBERT J. SLATER.
[ ] FOR the nominees listed above.
[ ] WITHHOLD AUTHORITY for the nominees listed above.
INSTRUCTION: To withhold authority for any individual nominee(s) check
the "FOR" box above and write that nominee(s) name on the space below provided:
------------------------------------------
B. Providence intends to use this proxy to vote for one of the
four individuals nominated by the Company to serve as a director. You may
withhold authority to vote for this additional Company nominee. Please
refer to management's Proxy Statement for the 1998 Annual Meeting for the
names, backgrounds, qualifications and other information concerning the
Company's nominees. There is no assurance that any of the Company's
nominees will serve as directors if any of Providence's nominees are
elected to the Board.
The Company's nominees with respect to whom Providence is NOT
seeking authority to vote for and WILL NOT exercise any such authority
are:
R. RICHARD ABLON, JUDITH D. MOYERS, and ROBERT E. SMITH
INSTRUCTION: To withhold authority to vote for the election of
the Company nominee whose name is not listed above, write such Company
nominee's name on the line provided below.
------------------------------------------
(Continued and to be signed on the reverse side)
<PAGE>
[REVERSE]
2. RATIFICATION OF AUDITORS ("Proposal 2"): Ratification of Deloitte
& Touche LLP as auditors of the Company for the year 1998.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. PROPOSAL TO DECLASSIFY BOARD ("Proposal 3"): Shareholder proposal
requesting the Board to take steps necessary to provide that new
directors be elected annually and not by classes.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. PROPOSAL TO SELL OGDEN ("Proposal 4"): Shareholder proposal
requesting the Board of Directors arrange for the prompt sale of
the Company to the highest bidder.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. PROPOSAL TO ENDORSE CERES PRINCIPLES ("Proposal 5"): Shareholder
proposal requesting the Company to endorse the Coalition for
Environmental Responsible Economic Principles.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
6. DISCRETIONARY AUTHORITY: In his discretion, the proxy is authorized
to vote upon such other business as may
properly come before the Annual Meeting.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE.
This Proxy Card, when properly executed, will be voted as directed herein. IF
NO INSTRUCTIONS ARE GIVEN, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED
"FOR" THE ELECTION OF THE THREE NOMINEES LISTED IN 1.A. ABOVE AND "FOR" THE
ELECTION OF THE COMPANY NOMINEE WHOSE NAME IS NOT LISTED IN ITEM 1.B. ABOVE,
"FOR" THE RATIFICATION OF DELOITTE & TOUCHE LLP AS AUDITORS, "FOR" SHAREHOLDER
PROPOSAL 3, AND "AGAINST" SHAREHOLDER PROPOSALS 4 AND 5, "FOR" ANY ADJOURNMENT
OR POSTPONEMENT SUPPORTED BY THE SOLICITING SHAREHOLDER, AND IN THE DISCRETION
OF THE PROXY AS TO ALL OTHER MATTERS. PROVIDENCE RECOMMENDS THAT SHAREHOLDERS
VOTE FOR THE ELECTION OF ITS FOUR NOMINEES, FOR THE RATIFICATION OF DELOITTE &
TOUCHE LLP AS AUDITORS, FOR SHAREHOLDER PROPOSAL 3 AND AGAINST SHAREHOLDER
PROPOSALS 4 AND 5.
PLEASE DATE AND SIGN THIS PROXY EXACTLY AS YOUR NAME APPEARS HEREON.
Dated:
----------------------------
Signature:
------------------------
Signature:
------------------------
<PAGE>
Title:
-----------------------------
If stock is jointly held, each joint owner should sign. When signing as
attorney in fact, executor, administrator, trustee, guardian, corporate
officer or partner, please give full title.
PLEASE SIGN, DATE AND RETURN THIS PROXY
<PAGE>
PRELIMINARY COPY
PREFERRED
THIS PROXY IS SOLICITED IN OPPOSITION
TO THE INCUMBENT BOARD OF DIRECTORS
AND MANAGEMENT OF THE COMPANY IN CONNECTION WITH
THE 1998 ANNUAL MEETING OF STOCKHOLDERS OF:
OGDEN CORPORATION
The undersigned shareholder of OGDEN CORPORATION (the "Company")
hereby appoints each of Herbert A. Denton and William Tapert as lawful
attorney and proxy, each with full power of substitution, for and in the
name of the undersigned to represent and vote, as designated below, all
shares of the $1.875 Cumulative Convertible Preferred Stock, Partially
Participating, of the Company which the undersigned is entitled to vote
at the 1998 annual meeting of shareholders of the Company, to be held on
May 20, 1998 at the Villas of Grand Cypress, One North Jacaranda,
Orlando, Florida commencing at 9:00 a.m., or at any adjournment,
postponement or rescheduling thereof (collectively, the "Annual
Meeting"). The undersigned hereby revokes any and all previous proxies
with respect to the matters covered by this proxy and the voting of such
shares at the Annual Meeting.
1. ELECTION OF DIRECTORS ("Proposal 1"):
A. Nominees of Providence Capital, Inc. ("Providence").
MICHAEL G. CONROY, LARRY G. SCHAFRAN and ROBERT J. SLATER.
[ ] FOR the nominees listed above.
[ ] WITHHOLD AUTHORITY for the nominees listed above.
INSTRUCTION: To withhold authority for any individual nominee(s) check
the "FOR" box above and write that nominee(s) name on the space below provided:
-----------------------------------------
B. Providence intends to use this proxy to vote for one of the
four individuals nominated by the Company to serve as a director. You may
withhold authority to vote for this additional Company nominee. Please
refer to management's Proxy Statement for the 1998 Annual Meeting for the
names, backgrounds, qualifications and other information concerning the
Company's nominees. There is no assurance that any of the Company's
nominees will serve as directors if any of Providence's nominees are
elected to the Board.
The Company's nominees with respect to whom Providence is NOT
seeking authority to vote for and WILL NOT exercise any such authority
are:
R. RICHARD ABLON, JUDITH D. MOYERS, and ROBERT E. SMITH
INSTRUCTION: To withhold authority to vote for the election of
the Company nominee whose name is not listed above, write such Company
nominee's name on the line provided below.
-----------------------------------------------
(Continued and to be signed on the reverse side)
<PAGE>
[REVERSE]
2. RATIFICATION OF AUDITORS ("Proposal 2"): Ratification of
Deloitte & Touche LLP as auditors of the Company for the year
1998.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. PROPOSAL TO DECLASSIFY BOARD ("Proposal 3"): Shareholder
proposal requesting the Board to take steps necessary to provide
that new directors be elected annually and not by classes.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. PROPOSAL TO SELL OGDEN ("Proposal 4"): Shareholder proposal
requesting the Board of Directors arrange for the prompt sale of
the Company to the highest bidder.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. PROPOSAL TO ENDORSE CERES PRINCIPLES ("Proposal 5"): Shareholder
proposal requesting the Company to endorse the Coalition for
Environmental Responsible Economic Principles.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
6. DISCRETIONARY AUTHORITY: In his discretion, the proxy is authorized
to vote upon such other business as may
properly come before the Annual Meeting.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
This Proxy Card, when properly executed, will be voted as directed herein. IF
NO INSTRUCTIONS ARE GIVEN, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED
"FOR" THE ELECTION OF THE THREE NOMINEES LISTED IN 1.A. ABOVE AND "FOR" THE
ELECTION OF THE COMPANY NOMINEE WHOSE NAME IS NOT LISTED IN ITEM 1.B. ABOVE,
"FOR" THE RATIFICATION OF DELOITTE & TOUCHE LLP AS AUDITORS, "FOR" SHAREHOLDER
PROPOSAL 3, AND "AGAINST" SHAREHOLDER PROPOSALS 4 AND 5, "FOR" ANY ADJOURNMENT
OR POSTPONEMENT SUPPORTED BY THE SOLICITING SHAREHOLDER, AND IN THE DISCRETION
OF THE PROXY AS TO ALL OTHER MATTERS. PROVIDENCE RECOMMENDS THAT SHAREHOLDERS
VOTE FOR THE ELECTION OF ITS FOUR NOMINEES, FOR THE RATIFICATION OF DELOITTE &
TOUCHE LLP AS AUDITORS, FOR SHAREHOLDER PROPOSAL 3 AND AGAINST SHAREHOLDER
PROPOSALS 4 AND 5.
PLEASE DATE AND SIGN THIS PROXY EXACTLY AS YOUR NAME APPEARS HEREON.
Dated:
----------------------------
Signature:
------------------------
<PAGE>
Signature:
-----------------------
Title:
----------------------------
If stock is jointly held, each joint owner should sign. When signing as
attorney in fact, executor, administrator, trustee, guardian, corporate officer
or partner, please give full title.
PLEASE SIGN, DATE AND RETURN THIS PROXY
