<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for the Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
</TABLE>
OLSTEN CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
OLSTEN CORPORATION
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[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:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
<PAGE> 2
LOGO
April 13, 1999
DEAR SHAREHOLDER:
You are cordially invited to attend the Annual Meeting of Shareholders of
Olsten Corporation to be held on May 4, 1999 at 9:00 a.m. at our world
headquarters located at 175 Broad Hollow Road, Melville, New York.
The accompanying Notice and Proxy Statement describe the matters to be
voted upon at the Annual Meeting. Holders of Common Stock and Class B Common
Stock will be entitled to one vote and ten votes, respectively, at the Annual
Meeting for each share held of record at the close of business on March 15,
1999, but will vote as separate classes in the election of Directors.
At the Annual Meeting, shareholders will have an opportunity to inquire
about the affairs of the Company that may be of interest to shareholders
generally. We shall also feature an exhibit and some demonstrations that you may
find interesting.
We would appreciate your signing, dating and returning the enclosed proxy
in the envelope provided for that purpose so that your shares may be represented
and voted at the Annual Meeting in the event you do not attend. If you attend
the Annual Meeting, you may withdraw your proxy and vote in person.
Thank you and we look forward to greeting you personally if you are able to
be present.
<TABLE>
<S> <C>
Sincerely, Sincerely,
EDWARD A. BLECHSCHMIDT STUART OLSTEN
President and Chief Executive Officer Chairman of the Board
</TABLE>
<PAGE> 3
[OLSTEN CORPORATION LOGO]
175 BROAD HOLLOW ROAD
MELVILLE, NEW YORK 11747-8905
------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 4, 1999
------------------------------
TO THE SHAREHOLDERS OF OLSTEN CORPORATION:
You are cordially invited to attend the Annual Meeting of Shareholders of
Olsten Corporation, a Delaware corporation (the "Company"), which will be held
at the executive offices of the Company, 175 Broad Hollow Road, Melville, New
York 11747-8905, on May 4, 1999, at 9:00 a.m., New York time, for the following
purposes:
1. To elect nine Directors of the Company, three by the holders of
Common Stock voting separately as a class and six by the holders of Class B
Common Stock voting separately as a class, to serve until the next Annual
Meeting of Shareholders and until their successors are elected and qualify;
2. To consider and vote upon a proposal to approve the Company's
Executive Officers Bonus Plan;
3. To consider and vote upon a proposal to ratify and approve the
appointment by the Board of Directors of PricewaterhouseCoopers LLP as
independent accountants for the Company for its 1999 fiscal year;
4. If presented, to consider and vote upon a proposal to eliminate
stock options, bonuses and restricted shares for top senior management,
expected to be made by one shareholder;
5. If presented, to consider and vote upon a proposal to require
shareholder approval of change of control agreements, expected to be made
by one shareholder;
6. If presented, to consider and vote upon a proposal requesting the
prompt sale of the Company to the highest bidder, expected to be made by
one shareholder; and
7. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The stock transfer books of the Company will not be closed but only
shareholders of record at the close of business on March 15, 1999 are entitled
to notice of and to vote at such meeting or any adjournments thereof.
BY ORDER OF THE BOARD OF DIRECTORS
Laurin L. Laderoute, Jr.
Secretary
Dated: April 13, 1999
Melville, New York
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. WE DO HOPE
YOU WILL ATTEND, BUT IF YOU DO NOT INTEND TO BE PRESENT IN PERSON, PLEASE MARK,
SIGN, DATE AND RETURN THE ACCOMPANYING PROXY PROMPTLY. A STAMPED REPLY ENVELOPE
IS ENCLOSED FOR THAT PURPOSE.
<PAGE> 4
[OLSTEN CORPORATION LOGO]
175 BROAD HOLLOW ROAD
MELVILLE, NEW YORK 11747-8905
------------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 4, 1999
------------------------------
This Proxy Statement is furnished to shareholders of Olsten Corporation, a
Delaware corporation (the "Company"), in connection with the solicitation of
proxies by the Board of Directors of the Company for use at the Annual Meeting
of Shareholders to be held at the executive offices of the Company, 175 Broad
Hollow Road, Melville, New York 11747-8905, on May 4, 1999, at 9:00 a.m., New
York time, including any adjournments thereof, for the purposes set forth in the
accompanying Notice of Meeting. Only shareholders of record at the close of
business on March 15, 1999 are entitled to vote at such meeting. This Proxy
Statement and the accompanying proxy are first being sent or given to
shareholders on or about April 13, 1999.
A shareholder who returns the accompanying proxy may revoke it at any time
before it is voted by giving notice in writing to the Company, by granting a
subsequent proxy or by appearing in person and voting at the meeting. Any
shareholder attending the meeting and entitled to vote may vote in person
whether or not said shareholder has previously submitted a proxy. Where no
instructions are indicated, proxies will be voted for the nominees for Directors
set forth herein (Proposal 1), in favor of Proposals 2 and 3 described herein
and, if they are presented to the meeting, against Proposals 4, 5 and 6
described herein.
Proxies marked as abstentions will have the effect of a negative vote.
Broker non-votes (where a nominee holding shares for a beneficial owner has not
received voting instructions from the beneficial owner with respect to a
particular matter and such nominee does not possess or choose to exercise its
discretionary authority with respect thereto) will be considered as present at
the meeting but not entitled to vote with respect to the particular matter and
will have no effect on the vote. Votes are counted by employees of ChaseMellon
Shareholder Services, L.L.C., the Company's independent transfer agent and
registrar.
At the close of business on March 15, 1999, the record date for the
determination of shareholders entitled to vote at the Annual Meeting, the
Company had outstanding 68,209,893 shares of its Common Stock, par value $.10
per share ("Common Stock"), and 13,068,927 shares of its Class B Common Stock,
par value $.10 per share ("Class B Common Stock"). The holders of such Common
Stock and Class B Common Stock are entitled to one vote and ten votes,
respectively, for each share held on such record date, but with respect to the
election of Directors, holders of Common Stock voting separately as a class are
entitled to elect three Directors and holders of Class B Common Stock voting
separately as a class are entitled to elect six Directors.
No person has been authorized to give any information or to make any
representation other than those contained in this Proxy Statement and, if given
or made, such information or representation must not be relied upon as having
been authorized by the Company.
A copy of the 1998 Annual Report to Shareholders, containing the financial
statements of the Company and a report with respect thereto by
PricewaterhouseCoopers LLP, independent accountants, and a special Company
brochure are also being mailed to you herewith. The Annual Report and special
Company brochure are not deemed a part of the soliciting material for the proxy.
<PAGE> 5
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 15, 1999, the amount and nature
of beneficial ownership of the Company's Common Stock and Class B Common Stock
by each Director and nominee for Director; each beneficial owner of more than
five percent of the Common Stock or Class B Common Stock known by management;
named executive officers of the Company; and all executive officers and
Directors as a group.
Since each share of Class B Common Stock may be converted into one share of
Common Stock, the beneficial ownership rules under the Securities Exchange Act
of 1934 require that all shares of Common Stock issuable upon the conversion of
Class B Common Stock by any shareholder be included in determining the number of
shares and percentage of Common Stock held by such shareholder. The effect of
the assumption that such shareholder has converted into Common Stock the shares
of Class B Common Stock of which such shareholder is the beneficial owner is
also reflected in the following table. For a more complete description of the
method used to determine such beneficial ownership, see footnote (2) to the
following table.
<TABLE>
<CAPTION>
AMOUNT OF SHARES AND NATURE PERCENT OF CLASS IF
OF BENEFICIAL OWNERSHIP(1)(2) MORE THAN 1.0%(2)
---------------------------------------- -------------------------------
COMMON STOCK COMMON STOCK
(IF CLASS B (IF CLASS B
CLASS B COMMON STOCK CLASS B COMMON STOCK
NAME AND ADDRESS COMMON COMMON DEEMED COMMON COMMON DEEMED
OF BENEFICIAL OWNER STOCK STOCK CONVERTED) STOCK STOCK CONVERTED)
------------------- ------ ------- ------------ ------ ------- ------------
<S> <C> <C> <C> <C> <C> <C>
Miriam Olsten 21,700 4,075,714(3) 4,097,414(3) -- 31.2% 5.7%
175 Broad Hollow Road
Melville, NY
Stuart Olsten 126,725(4) 6,236,199(4) 6,362,924(4) -- 47.7% 8.5%
175 Broad Hollow Road
Melville, NY
Cheryl Olsten 5,243,412(5) 5,243,412(5) 40.1% 7.1%
175 Broad Hollow Road
Melville, NY
Andrew N. Heine 2,454(6) 3,127,610(6) 3,130,064(6) -- 23.9% 4.4%
114 West 47th Street
New York, NY
Robert L. Riedinger 225,000 5,734,052(7) 5,959,052(7) -- 43.9% 8.1%
4444 Blackland Drive
Marietta, GA
Edward A. Blechschmidt 112,000(8) --
Victor F. Ganzi 5,203(9) --
Stuart R. Levine 18,853 --
John M. May 38,200(10) --
Richard J. Sharoff 23,621 --
Raymond S. Troubh 96,299(11) 64,559 160,858(11) -- -- --
Josh S. Weston 20,550 --
Frank N. Liguori 1,417,734 9 1,417,743 2.1% -- 2.1%
Robert A. Fusco 170,250 --
Anthony J. Puglisi 71,125 --
Gerald J. Kapalko 87,225(12) --
Pacific Financial Research 6,133,400(13) 9.0%
9601 Wilshire Boulevard
Beverly Hills, CA
First Manhattan Co. 4,981,822(14) 7.3%
437 Madison Avenue
New York, NY
Morgan Stanley Dean Witter & Co. and Miller
Anderson & Sherrerd, LLP 4,063,269(15) 6.0%
1585 Broadway
New York, NY
All executive officers and 905,986(16) 10,379,475(17) 11,285,461(16)(17) 1.3% 79.0% 14.3%
Directors as a group
(17 persons)
</TABLE>
- ---------------
(1) Unless otherwise indicated, the shareholders identified in this table have
sole voting and investment power with respect to the shares beneficially
owned by them.
2
<PAGE> 6
(2) Each named person and all executive officers and Directors as a group are
deemed to be the beneficial owners of securities that may be acquired
within 60 days through the exercise of options or exchange or conversion
rights. Accordingly, the number of shares and percentage set forth opposite
each shareholder's name in the above table under the columns captioned
"Common Stock" and "Class B Common Stock" include shares of Common Stock
and Class B Common Stock (in the case of Mr. Troubh), respectively,
issuable upon exercise of presently exercisable stock options under the
Company's stock option plans as follows: 19,500, 122,925, 15,000, 19,500,
19,500, 19,500, 15,000, 55,000, 118,125, 58,875 and 69,375 shares of Common
Stock as to, respectively, M. Olsten, S. Olsten, S. Levine, J. May, R.
Sharoff, R. Troubh, J. Weston, F. Liguori, R. Fusco, A. Puglisi and G.
Kapalko; and 64,559 shares of Class B Common Stock as to R. Troubh. The
columns captioned "Common Stock (if Class B Common Stock Deemed Converted)"
relating to such shareholders reflect the effect of the right to convert
beneficially owned shares of Class B Common Stock into Common Stock, both
with respect to the number of shares of Common Stock deemed to be
beneficially owned and the adjusted percentage of outstanding Common Stock
resulting from such right of conversion. However, the shares of Common
Stock so issuable upon such exercise, exchange or conversion by any such
shareholder are not included in calculating the number of shares or
percentage of Common Stock beneficially owned by any other shareholder.
(3) Mrs. Olsten owns of record 3,138,904 shares of Class B Common Stock. She
has sole voting and investment power with respect to 936,810 shares of
Class B Common Stock held under a trust for the benefit of one of her
children, of which she is trustee, and as to which shares she disclaims
beneficial ownership.
(4) Mr. Olsten's holding includes 3,600 shares of Common Stock owned of record
and 200 shares of Common Stock owned of record by his wife, as to which
shares he disclaims beneficial ownership. Mr. Olsten owns of record
1,928,629 shares of Class B Common Stock and has shared voting and
investment power as a trustee with respect to 2,522,837 shares of Class B
Common Stock owned by a trust for his and his sister's benefit and
1,563,805 shares of Class B Common Stock owned by a trust for his benefit.
He has shared voting and investment power as a trustee with respect to
45,000 shares of Class B Common Stock owned by a trust for the benefit of
his son, 90,000 shares of Class B Common Stock owned by two trusts for the
benefit of his niece and nephew and 83,605 shares of Class B Common Stock
owned by a trust for the benefit of his descendants, as to which shares he
disclaims beneficial ownership. His holding further includes 1,000 shares
of Class B Common Stock owned of record by his wife and 1,323 shares of
Class B Common Stock held in a custodial account for his daughter, as to
which shares he disclaims beneficial ownership.
(5) Ms. Olsten owns of record 938,165 shares of Class B Common Stock and has
shared voting and investment power as a trustee with respect to 2,522,837
shares of Class B Common Stock owned by a trust for her and her brother's
benefit and 1,563,805 shares of Class B Common Stock owned by a trust for
her benefit. Ms. Olsten has shared voting and investment power as a trustee
with respect to 90,000 shares of Class B Common Stock owned by two trusts
for the benefit of her two children, 45,000 shares of Class B Common Stock
held by a trust for the benefit of her nephew and 83,605 shares of Class B
Common Stock owned by a trust for the benefit of her descendants, as to
which shares she disclaims beneficial ownership.
(6) Includes 575 shares of Common Stock as to which Mr. Heine has an indirect
beneficial interest and 1,200 shares owned by Mr. Heine's wife, as to which
shares he disclaims beneficial ownership. Mr. Heine has shared voting and
investment power as a trustee with respect to 1,563,805 shares of Class B
Common Stock owned by a trust for the benefit of Stuart Olsten and as a
trustee with respect to
(footnotes continued on next page)
3
<PAGE> 7
1,563,805 shares of Class B Common Stock owned by a trust for the benefit
of Cheryl Olsten, as to which shares Mr. Heine disclaims beneficial
ownership.
(7) Mr. Riedinger has shared voting and investment power as a trustee with
respect to 2,522,837 shares of Class B Common Stock owned by a trust for
the benefit of Stuart Olsten and Cheryl Olsten, 1,563,805 shares of Class B
Common Stock owned by a trust for the benefit of Stuart Olsten, 1,563,805
shares of Class B Common Stock owned by a trust for the benefit of Cheryl
Olsten and 83,605 shares of Class B Common Stock owned by a trust for the
benefit of descendants of Ms. Olsten, as to which shares Mr. Riedinger
disclaims beneficial ownership.
(8) Includes 14,000 shares owned by his wife, as to which shares he disclaims
beneficial ownership.
(9) Includes 2,200 shares representing the equivalent of units deferred under
the Company's Stock & Deferred Compensation Plan for Non-Employee
Directors.
(10) Includes 2,200 shares representing the equivalent of units deferred under
the Company's Stock & Deferred Compensation Plan for Non-Employee
Directors.
(11) Includes 2,200 shares representing the equivalent of units deferred under
the Company's Stock & Deferred Compensation Plan for Non-Employee
Directors.
(12) Includes 8,550 shares owned by his wife and 300 shares owned by his
daughter, as to which shares he disclaims beneficial ownership.
(13) Based on a Schedule 13G dated February 11, 1999 and filed with the
Securities and Exchange Commission. Pacific Financial Research held sole
voting power and sole dispositive power as to all of such shares.
(14) Based on a Schedule 13G dated February 11, 1999 and filed with the
Securities and Exchange Commission. First Manhattan Co. held sole voting
power and sole dispositive power as to 140,000 of such shares, shared
voting power as to 4,582,789 of such shares and shared dispositive power as
to 4,841,822 of such shares.
(15) Based on a Schedule 13G dated February 15, 1999 and jointly filed with the
Securities and Exchange Commission. Morgan Stanley Dean Witter & Co. held
shared voting power as to 3,476,699 of such shares and shared dispositive
power as to 4,063,269 of such shares, and Miller Anderson & Sherrerd, LLP
held shared voting power as to 3,133,900 of such shares and shared
dispositive power as to 3,636,870 of such shares.
(16) Includes 325,772 shares of Common Stock owned by executive officers and
Directors, 573,614 shares of Common Stock that may be purchased pursuant to
presently exercisable stock options and 6,600 shares representing shares
deferred as share units.
(17) Includes 10,311,913 shares of Class B Common Stock owned by executive
officers and Directors and 67,562 shares of Class B Common Stock that may
be purchased pursuant to presently exercisable stock options.
4
<PAGE> 8
PROPOSAL 1
ELECTION OF DIRECTORS
The nine persons named below, all of whom are presently Directors of the
Company, have been nominated for election as Directors of the Company. Three
Directors are to be elected by the holders of Common Stock voting separately as
a class, and six Directors are to be elected by the holders of Class B Common
Stock voting separately as a class, with the Directors, in each separate class
vote, to be elected by a plurality of the votes cast. All Directors will serve
until the next Annual Meeting of Shareholders and until their successors are
elected and qualify. If no contrary instructions are indicated, it is intended
that the accompanying proxy will be voted for the election of the respective
Directors hereinafter shown as nominees for each respective class of stock. The
Company does not expect that any of the nominees will be unavailable for
election, but if that should occur before the meeting, the proxies may be voted
for a substitute nominee or nominees.
NOMINEES FOR ELECTION BY HOLDERS OF COMMON STOCK
EDWARD A. BLECHSCHMIDT
Mr. Blechschmidt, age 46 and a Director of the Company since February 1999,
has been Chief Executive Officer of the Company since February 1999, its
President since October 1998 and its Chief Operating Officer from October 1998
to February 1999. From August 1996 to October 1998 he was President and Chief
Executive Officer of Siemens Nixdorf Americas, an information technology
company. From January 1996 to July 1996 he was Senior Vice President and Chief
Financial Officer of Unisys Corporation, a provider of information technology
and consulting services; from January 1995 to December 1995 he was Senior Vice
President and President, United States and Canada Division, of Unisys
Corporation; and from 1990 to December 1994 he was Senior Vice President and
President, Pacific Asia Americas Division, of Unisys Corporation. He is a
director of EA Industries, Inc.
JOHN M. MAY
Mr. May, age 71 and a Director of the Company since 1989, has been an
independent management consultant for more than five years.
JOSH S. WESTON
Mr. Weston, age 70 and a Director of the Company since 1995, has been
Honorary Chairman of Automatic Data Processing, Inc., a provider of computerized
transaction processing, data communication and information services, since May
1998. He was Chairman of Automatic Data Processing, Inc. from 1982 to April 1998
and was Chief Executive Officer of Automatic Data Processing, Inc. from 1982 to
August 1996. He is a director of Automatic Data Processing, Inc., J. Crew Inc.,
Public Service Enterprise Group Company, Shared Medical Systems, Inc. and
Vanstar Corporation.
NOMINEES FOR ELECTION BY HOLDERS OF CLASS B COMMON STOCK
VICTOR F. GANZI
Mr. Ganzi, age 52, has been Executive Vice President of The Hearst
Corporation, a diversified communications company with interests in magazine,
newspaper, book and business publishing and television and radio stations, since
March 1997 and its Chief Operating Officer since March 1998. From 1992 to 1997,
at various times Mr. Ganzi served as Hearst's Senior Vice President, Chief
Financial Officer and Chief Legal
5
<PAGE> 9
Officer. Since March 1995 he has also been Group Head of Hearst's Books/Business
Publishing Group. He is a director of Hearst-Argyle Television, Inc.
STUART R. LEVINE
Mr. Levine, age 51 and a Director of the Company since 1995, has been
Chairman and Chief Executive Officer of Stuart Levine & Associates LLC, an
international training company specializing in leadership, communication, team
building and strategic planning, since June 1996. From September 1992 to June
1996 he was Chief Executive Officer of Dale Carnegie & Associates, Inc., a
global provider of corporate training in leadership and personal development.
MIRIAM OLSTEN
Mrs. Olsten, age 74 and a Director of the Company since 1993, is a
significant shareholder of the Company. She is the mother of Stuart Olsten, a
Director and Chairman of the Board of the Company.
STUART OLSTEN
Mr. Olsten, age 46 and a Director of the Company since 1986, has been
Chairman of the Board of the Company since February 1999. He was Vice Chairman
of the Company from August 1994 to February 1999 and was President of the
Company from April 1990 to February 1999. He is the son of Miriam Olsten, a
Director of the Company.
RICHARD J. SHAROFF
Mr. Sharoff, age 52 and a Director of the Company since 1994, has been
President and Chief Executive Officer of MagCorp., Inc., a franchisor of
restaurants, since November 1996. From January 1996 to November 1996 he was
Chairman and Chief Executive Officer of Superior Pasta, L.L.C., a developmental
stage company in the food industry. From July 1995 to December 1995 he was a
consultant to the food industry. From January 1992 to June 1995, he was
President and Chief Executive Officer of Haifoods, Inc., a holding company in
the food and beverage industries.
RAYMOND S. TROUBH
Mr. Troubh, age 72 and a Director of the Company since 1993, has been a
financial consultant for more than five years. He is a director of ARIAD
Pharmaceuticals, Inc., Becton Dickinson and Company, Diamond Offshore Drilling,
Inc., Foundation Health Systems, Inc., General American Investors Company,
Starwood Hotel & Resorts, Triarc Companies, Inc. and WHX Corporation.
------------------------------------
The Board held eleven meetings during the past fiscal year. Pursuant to the
Company's Stock & Deferred Compensation Plan for Non-Employee Directors, which
was approved by shareholders in 1998, each outside member of the Board was paid
an annual retainer fee in 1998 in shares of the Company's Common Stock or
allowed to defer such payment into a share unit account. The amount of the
annual retainer fee is determined by dividing $30,000 by the average closing
price of the Company's Common Stock on the New York Stock Exchange for the ten
trading days immediately prior to the Company's annual shareholders meeting,
rounding the quotient to the nearest 100 shares. Each outside member of the
Board was also paid $1,500 for each meeting of the Board attended.
The Board has a standing compensation committee, comprised of Messrs.
Ganzi, Levine, May and Weston, a standing audit committee, comprised of Messrs.
Ganzi, Levine, May and Sharoff, and an executive committee, comprised of Messrs.
Ganzi, May, Olsten and Weston. The compensation committee, audit committee and
executive committee held four meetings, three meetings, and four meetings,
respectively, in
6
<PAGE> 10
1998. Each Director who was a committee member was paid $1,000 for each such
meeting attended. The compensation committee reviews and approves senior
executive compensation, determines compensation of the Chief Executive Officer
and administers certain of the Company's stock plans. The audit committee
reviews the Company's financial results, the scope and results of audits of the
Company by its independent accountants and the scope and results of internal
audits and oversees the Company's compliance program. The executive committee
acts in the stead of the entire Board between Board meetings. The Board has no
nominating committee.
In 1998, options to purchase 6,000 shares of Common Stock at a per share
exercise price of $7.1875 were automatically granted to each of Messrs. Ganzi,
Levine, May, Sharoff, Troubh and Weston and Mrs. Olsten, under the Company's
1990 Non-Qualified Stock Option Plan for Non-Employee Directors and Consultants,
as amended and restated. All such options will become vested and fully
exercisable in six months from the date of grant, which was December 7, 1998.
In July 1998, the Company commenced a series of monthly charitable
contributions of $25,000 to Thirteen/WNET in recognition of Mr. Weston's ongoing
contributions to the Board of Directors of the Company and his chairing of the
Board's Executive Committee. Such contributions aggregated $150,000 in 1998. Mr.
Weston is a member of the Board of Trustees of Thirteen/WNET.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires certain
persons, including the Company's Directors and executive officers, to file
reports with the Securities and Exchange Commission regarding beneficial
ownership of equity securities of the Company. The Company believes that all
such reports were filed on a timely basis in 1998.
------------------------------------
7
<PAGE> 11
EXECUTIVE COMPENSATION
The following table sets forth information concerning the annual and
long-term compensation of the Company's Chief Executive Officer serving during
1998 and the other four most highly compensated executive officers (the "Named
Officers") serving at fiscal year end for services as executive officers of the
Company for the last three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-----------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------------ ---------------------------- ----------
OTHER ANNUAL RESTRICTED SECURITIES ALL OTHER
NAME AND COMPENSATION STOCK UNDERLYING LTIP COMPENSATION
PRINCIPAL POSITION YEAR SALARY($) BONUS($) ($)(1) AWARDS($)(2) OPTIONS(#) PAYOUTS($) ($)(3)
------------------ ---- --------- -------- ------------ ------------ ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Frank N. Liguori(4) 1998 $1,000,000 $ $5,576 100,000 $1,134,375(5) $149,040
Chairman and Chief 1997 1,000,000 700,000 2,619 150,000 4,295,700(6) 164,790
Executive Officer 1996 1,007,692 875,000 192,483
Stuart Olsten 1998 650,000 2,162 50,000 54,540
Vice Chairman and 1997 650,000 325,000 2,162 150,000 83,790
President 1996 637,019 425,000 30,000 91,622
Robert A. Fusco 1998 600,000 2,490 75,000 50,040
Executive Vice President 1997 600,000 1,484 150,000 71,640
and President, Olsten 1996 587,019 240,000 25,000 75,881
Health Services
Anthony J. Puglisi 1998 344,231 150,000 1,913 50,000 40,521
Executive Vice President 1997 319,808 150,000 1,913 75,000 38,322
and Chief Financial 1996 294,231 150,000 30,000 36,021
Officer
</TABLE>
<TABLE>
Gerald J. Kapalko 1998 335,000 150,000 2,264 35,000 39,690
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Executive Vice President 1997 329,808 135,000 2,264 50,000 37,872
and President, Olsten 1996 312,019 85,000 20,000 31,772
Latin America
</TABLE>
- ---------------
(1) Gross up of taxable portion of fringe benefit.
(2) The number and value of the aggregate restricted (unvested) share holdings
at January 3, 1999 are as follows:
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
RESTRICTED RESTRICTED
NAME SHARES SHARES
---- ---------- ----------
<S> <C> <C>
F. N. Liguori............................................... 75,000 $553,125
</TABLE>
(3) Represents profit sharing and matching contributions contributed by the
Company for the Named Officers to the Company's Non-Qualified Retirement
Plan for Selected Management Employees.
(4) Mr. Liguori resigned from the Company on February 10, 1999. See "Employment
Contracts, Termination of Employment and Change-in-Control Arrangements."
(5) The long-term incentive payout reported for Mr. Liguori reflects the dollar
value on the date of issuance of shares of the Company's Common Stock
(75,000 shares) issued to Mr. Liguori further to an incentive award approved
by shareholders at the Company's 1994 Annual Meeting.
(6) The long-term incentive payout reported for Mr. Liguori reflects the dollar
value on the date of issuance of (i) shares of the Company's Common Stock
(150,000 shares) issued to Mr. Liguori further to an incentive award
approved by shareholders at the Company's 1994 Annual Meeting and (ii)
shares of the Company's Common Stock (136,380 shares) issued to Mr. Liguori
further to a performance award approved by shareholders at the Company's
1996 Annual Meeting.
8
<PAGE> 12
STOCK OPTIONS
The following table contains information concerning the grant of stock
options to the Named Officers during the Company's last fiscal year.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
---------------------------------------------------------- ANNUAL RATES
NUMBER OF OF STOCK
SECURITIES PERCENT OF TOTAL PRICE APPRECIATION
UNDERLYING OPTIONS GRANTED EXERCISE FOR OPTION TERM(1)
OPTIONS TO EMPLOYEES IN PRICE EXPIRATION ---------------------
NAME GRANTED(#)(2) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
---- ------------- ---------------- -------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Frank N. Liguori.......... 100,000 5.1% $14.6875 1/13/08 $923,680 $2,340,810
Stuart Olsten............. 50,000 2.5 14.6875 1/13/08 461,840 1,170,405
Robert A. Fusco........... 40,000 2.0 14.6875 1/13/08 369,472 936,324
35,000 1.8 9.125 7/30/08 200,851 509,002
Anthony J. Puglisi........ 50,000 2.5 9.125 7/30/08 286,930 727,145
Gerald J. Kapalko......... 10,000 0.5 14.6875 1/13/08 92,368 234,081
25,000 1.3 9.125 7/30/08 143,465 363,573
</TABLE>
- ---------------
(1) The dollar amounts under these columns are the result of calculations at the
5% and 10% rates set by the Securities and Exchange Commission and are not
intended to forecast possible future appreciation of the Company's stock
price.
(2) The options were granted at an exercise price equal to the fair market value
of the Company's Common Stock on the date of grant. The options have a
ten-year term and become exercisable over a four-year period in increments
of 25% per year beginning with the first anniversary of the date of grant.
The following table sets forth information with respect to the Named
Officers concerning the exercise of options during the last fiscal year and
unexercised options held as of the end of that year.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS
SHARES YEAR END(#) AT FISCAL YEAR END($)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Frank N. Liguori.......... 0 -- 30,000 220,000 $ 0 $ 0
Stuart Olsten............. 0 -- 110,425 194,375 0 0
Robert A. Fusco........... 0 -- 108,125 216,875 0 0
Anthony J. Puglisi........ 0 -- 58,875 130,625 0 0
Gerald J. Kapalko......... 0 -- 66,875 90,625 0 0
</TABLE>
9
<PAGE> 13
RETIREMENT PLAN
The following table shows the estimated annual retirement benefit payable
on a straight life annuity basis at normal retirement date to participants in
the Company's Supplemental Executive Retirement Plan for key employees
designated by the Company ("SERP"), which is a non-contributory, non-qualified
defined benefit plan. Amounts shown include Social Security benefits and the
annuitized value of accumulations of profit sharing contributions made by the
Company on behalf of a participant.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
ANNUAL BENEFITS FOR YEARS OF SERVICE
REMUNERATION -------------------------------------
------------ 10 YEARS 15 YEARS 20 YEARS
<S> <C> <C> <C>
$ 250,000................................................. $ 75,000 $112,500 $ 150,000
450,000................................................ 135,000 202,500 270,000
650,000................................................ 195,000 292,500 390,000
850,000................................................ 255,000 382,500 510,000
1,050,000................................................ 315,000 472,500 630,000
1,250,000................................................ 375,000 562,500 750,000
1,450,000................................................ 435,000 652,500 870,000
1,650,000................................................ 495,000 742,500 990,000
1,850,000................................................ 555,000 832,500 1,110,000
2,050,000................................................ 615,000 922,500 1,230,000
</TABLE>
The SERP benefit objective is to provide a participant who has spent a
20-year career with the Company with retirement income at age 62 equal to 60% of
the average of his or her covered compensation (salary, bonuses and incentive
compensation) over the highest five of six consecutive years out of last ten
years prior to retirement. Proportionately decreased benefits may be payable at
early retirement. The SERP benefit is reduced both by the value of Social
Security benefits and by the annuitized value of accumulations of profit sharing
contributions made on behalf of a participant by the Company. The current
credited years of service for Messrs. Liguori, Olsten, Fusco, Puglisi and
Kapalko are 27, 23, 13, 5 and 20, respectively.
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
Frank N. Liguori served as Chairman of the Board and Chief Executive
Officer pursuant to an employment agreement which provided that if Mr. Liguori's
employment was terminated by the Company for any reason other than for
disability or for cause, or if Mr. Liguori voluntarily terminated his employment
within one year after a Change of Control (as defined), a substantial change in
his responsibilities or a determination not to renew the employment agreement,
he would be entitled to receive a cash lump sum equal to (i) his then current
base salary, plus the highest bonus paid or payable to him during the term of
the employment agreement plus the annualized value of benefits provided under
the Company's benefit programs multiplied by (ii) the number of full and partial
years in the period from the date of termination to the twenty-fourth month
following the date on which his employment would otherwise have terminated. On
February 10, 1999, Mr. Liguori and the Company entered into a separation
agreement pursuant to which he resigned his positions with the Company and the
employment agreement was cancelled. In consideration of Mr. Liguori's
relinquishing his rights under the employment agreement, his agreeing not to
compete with the Company for one year and not to solicit customers or employees
for two years, and his release of all claims relating to his employment with the
Company, Mr. Liguori received a lump sum payment of $9,887,500. Mr. Liguori will
also provide consulting services to the Company for one year and receive
$225,000 for such services. Stock options previously granted to Mr. Liguori will
vest in accordance with their normal vesting schedule and will
10
<PAGE> 14
be exercisable through March 31, 2004. Mr. Liguori will also continue to receive
benefits under the Company's medical and dental plans through March 31, 2002,
and he will be entitled to his retirement benefits and payment of his legal
costs incurred in connection with the separation agreement.
The Company has entered into change in control agreements with each of
Messrs. Robert Fusco, Anthony Puglisi and Gerald Kapalko. The agreements were
for a term in effect through August 9, 1997 and are automatically extended for
successive one-year terms thereafter unless the Company provides one-year's
prior notice that it does not wish to extend the term. In addition, if a Change
in Control (defined substantially as occurring on the date any of the following
occurs: (a) any person or persons acting together which would constitute a
"group" for the purposes of Section 13(d) of the Securities Exchange Act of 1934
(other than the Company, any subsidiary of the Company, members of the Olsten
family and their "permitted transferees") shall beneficially own, directly or
indirectly, at least 25% of the total voting power of all classes of capital
stock of the Company; (b) either (i) certain directors (or, under certain
circumstances, their successors) cease for any reason to constitute at least a
majority of the members of the Company's Board of Directors or (ii) at a meeting
of the Company's shareholders called for the purpose of electing directors, a
majority of the persons nominated by the Board for election as directors fail to
be elected; (c) the Company's shareholders approve an agreement providing for
the merger or consolidation of the Company in which the Company is not the
continuing or surviving corporation or pursuant to which the Company's Common
Stock and Class B Common Stock are converted into cash, securities or other
property, except in certain circumstances; or (d) the Company's shareholders
approve an agreement (or agreements) providing for the sale or other disposition
(in one transaction or a series) of all or substantially all of the assets of
the Company) occurs during the term of the agreement, the agreement continues in
effect for a period of 36 months beyond the month in which the Change in Control
occurs.
If a Change in Control occurs and the executive's employment is terminated
during the term of the agreement for any reason except termination by the
Company for "cause," termination by the executive other than for "good reason"
or termination because of death, retirement or disability, the executive will
generally be entitled to receive a cash lump sum equal to 2.99 times the average
of the annual compensation payable to the executive by the Company for the five
calendar years preceding the calendar year in which a Change in Control occurs.
In addition, all outstanding stock options granted to the executive will become
fully exercisable and vested, and for the 36-month period after the date of the
executive's termination of employment, the Company will, upon request from the
executive, arrange to provide the executive with health, life, disability and/or
accident benefits substantially similar to those the executive received
immediately prior to the termination unless and until the executive receives
such benefits from a subsequent employer.
CERTAIN TRANSACTIONS
Ronald A. Malone, an Executive Vice President of the Company and President,
Olsten Staffing Services, United States and Canada, has a bridge loan from the
Company to assist in his relocation to New York. The largest amount of the loan
outstanding and the current amount outstanding is $98,200. Interest on the loan
is at prime.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Company has, with the direction and supervision of the Compensation
Committee of the Board of Directors, established and put into practice
compensation policies, plans and programs, whose goals are twofold: to attract
and retain qualified executives and to seek to enhance the Company's
profitability by uniting senior management's interests with those of the
Company's shareholders.
11
<PAGE> 15
BASE SALARY
Compensation for each of the Named Officers, as well as other senior
executives, consists of a base salary and annual and longer-term incentive
compensation. In the setting of base salaries, consideration is given to salary
surveys and review of salaries paid to senior executives with comparable
qualifications, experience and responsibilities at other companies. Annual and
longer-term incentive compensation is tied to the Company's and the executive's
success in achieving significant financial and non-financial goals.
The Committee fixed the base salary of the Chief Executive Officer and the
Vice Chairman and President. Beginning in 1994, the Chief Executive Officer's
base salary could not be set lower than the minimum base salary provided for in
his employment agreement with the Company. The Chief Executive Officer
recommended the base salaries of the other Named Officers and the other senior
executives for review and approval by the Committee.
INCENTIVE COMPENSATION
No bonus incentive compensation was paid to the Chief Executive Officer and
the Vice Chairman and President in 1998 because previously established net
income goals for the Company were not met. No bonus incentive compensation was
paid to the President of Olsten Health Services, because his profit targets were
not met. Except for the Executive Vice President and President, Olsten Latin
America, whose bonus incentive was based on the achievement of certain profit
targets, the Chief Executive Officer recommended the incentive compensation of
the Company's other senior executives, including the other Named Officer, and
the Committee reviewed and approved the final compensation for these executives.
STOCK OPTIONS AND GRANTS
During each fiscal year, the Committee considers the desirability of
granting senior executives, including the Named Officers, awards under the
Company's stock plans. In determining the amount and nature of awards under such
plans to be granted to the senior management group, including the Named Officers
other than the Chief Executive Officer and the Vice Chairman and President, the
Committee reviewed with the Chief Executive Officer awards recommended by him,
taking into account the respective scope of accountability, strategic and
operational goals, and anticipated performance requirements and contributions of
each member of the senior management group. Awards to the Chief Executive
Officer and the Vice Chairman and President were established separately and were
based, among other things, on the Committee's analysis of their respective past
and expected future contributions to the Company's achievement of its long-term
performance goals.
CEO COMPENSATION
The Committee maintained the Chief Executive Officer's base salary in 1998,
as it had in 1997 and 1996, at $1,000,000. No bonus compensation was awarded to
the Chief Executive Officer in 1998 because previously established Company
performance goals were not met. In 1998, the Committee awarded the Chief
Executive Officer 100,000 stock options, vesting over four years, which was the
second award of options to the Chief Executive Officer since 1990.
12
<PAGE> 16
DEDUCTIBILITY OF COMPENSATION
Section 162(m) of the Internal Revenue Code of 1986 generally limits to $1
million per person the Company's federal income tax deduction for compensation
paid in any year to its Chief Executive Officer and each of its four other
highest paid executive officers to the extent such compensation is not
"performance based" within the meaning of Section 162(m). The Committee will in
general seek to qualify compensation paid to such executive officers for
deductibility under Section 162(m) in order to decrease the after-tax cost of
such compensation to the Company, although there may be circumstances in which
it is not possible, or not in the Company's best interests, to do so.
The foregoing report has been furnished by:
<TABLE>
<S> <C>
Josh S. Weston, Chairman
Victor F. Ganzi
Stuart R. Levine
John M. May
</TABLE>
13
<PAGE> 17
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph for the period of five years commencing
January 1, 1994 and ending December 31, 1998 comparing the cumulative total
return on the Company's Common Stock against the cumulative total return of the
S&P MidCap 400 Index, a new Peer Group Index -- Staffing Services, a new Peer
Group Index -- Health Services and the Peer Group Index ("Old Peer Group Index")
comprised of the companies used in the shareholder return performance graph in
last year's Proxy Statement. The Company believes that utilization of the new
peer group indexes provides to shareholders a more complete picture of the
Company's relative stock performance.
The Peer Group Index -- Staffing Services is comprised of the following
publicly traded companies: Interim Services Inc.; Kelly Services, Inc.; Manpower
Inc.; and Norrell Corp. The Peer Group Index -- Health Services is comprised of
the following publicly traded companies: Apria Healthcare Group Inc.; Coram
Healthcare Corp.; In Home Health Inc.; and Pediatric Services of America Inc.
The Old Peer Group Index is comprised of the following publicly traded
companies: Apria Healthcare Group Inc.; Kelly Services, Inc.; Manpower Inc.;
Robert Half International Inc.; Staff Builders, Inc.; and Volt Information
Sciences, Inc.
The line graph assumes that $100 was invested on January 1, 1994 in each of
the Company's Common Stock, the S&P MidCap 400 Index, the Peer Group
Index -- Staffing Services, the Peer Group Index -- Health Services and the Old
Peer Group Index and that all dividends were reinvested. Media General Financial
Services furnished the data for the graph.
OLSTEN GRAPH
------------------------
14
<PAGE> 18
PROPOSAL 2
APPROVAL OF OLSTEN CORPORATION
EXECUTIVE OFFICERS BONUS PLAN
GENERAL
In 1994 the Company established, and the shareholders approved, the
Executive Officers Bonus Plan (the "Executive Bonus Plan") pursuant to which the
executive officers of the Company (each an "Executive", and collectively the
"Executives") may be entitled to receive annual bonus compensation, contingent
upon the attainment of certain performance goals. The Executive Bonus Plan has
been amended, subject to shareholder approval, to expand the performance
criteria, as described below, that may be utilized under the plan.
In order to qualify under the performance-based compensation exception
under Section 162(m) of the Code, and thereby avoid potential nondeductibility
of bonus compensation paid to certain executive officers, the material terms of
the Executive Bonus Plan (including the class of eligible participants, the
performance criteria contemplated by the plan and the maximum amount payable
under the plan) must be approved by shareholders periodically. Accordingly, the
Executive Bonus Plan is being submitted for additional shareholder approval.
A copy of the Executive Bonus Plan is attached as Exhibit A to this Proxy
Statement. The material features of the Executive Bonus Plan are described
below, but this description is only a summary and is qualified in its entirety
by reference to the actual text of the Executive Bonus Plan.
PURPOSE
The purpose of the Executive Bonus Plan is to provide Executives with an
opportunity to earn annual bonus compensation (an "Award") as an incentive and
reward for their leadership, ability and exceptional services.
ADMINISTRATION
The Executive Bonus Plan is administered by a committee of the Board (the
"Board Committee") consisting of not less than two persons who, to the extent
required to satisfy the exception for performance based compensation under
Section 162(m) of the Code, will be "outside directors" within the meaning of
such section.
Subject to the express provisions of the Executive Bonus Plan, the Board
Committee has the authority to (i) establish performance goals for the granting
of Awards for each fiscal year of the Company (a "Plan Year"), (ii) determine
the Executives to whom Awards are to be made for each Plan Year, (iii) determine
whether the performance goals for any Plan Year have been achieved, (iv)
authorize payment of Awards under the Executive Bonus Plan, (v) adopt, alter and
repeal such administrative rules, guidelines and practices governing the
Executive Bonus Plan as it deems advisable, and (vi) interpret the terms and
provisions of the Executive Bonus Plan. There are approximately seven Executives
who will be eligible to participate in the Executive Bonus Plan.
DETERMINATION OF AWARDS
The amount of any Award granted to an Executive for a Plan Year will be an
amount not greater than the lesser of 200% of such Executive's annual base
salary or $2.5 million, which amount will be determined based
15
<PAGE> 19
on the achievement of one or more performance goals established by the Board
Committee with respect to such Executive. Performance goals may vary from
Executive to Executive and shall be based upon such one or more of the following
performance criteria as the Board Committee may deem appropriate: appreciation
in share value, total shareholder return, earnings per share, operating income,
net income, pro forma net income, return on equity, return on designated assets,
return on capital, economic value added, earnings, revenues, expenses, operating
profit margin, operating cash flow, gross profit margin, net profit margin,
employee turnover, employee headcount, labor costs, customer service and
accounts receivable. The performance goals may be determined by reference to the
performance of the Company, or of a subsidiary or affiliate, or of a division or
unit of any of the foregoing. Not later than the day immediately preceding the
first day of such Plan Year (or such later date as may be permitted pursuant to
Section 162(m) of the Code) (the "Determination Date"), the Board Committee will
establish (i) the Executives who will be eligible for an Award for such Plan
Year, (ii) the Executive's annual base salary for purposes of determining the
amount of such Executives's Award for such Plan Year, (iii) the performance
goals for such Plan Year, and (iv) the corresponding Award amounts payable under
the Executive Bonus Plan upon achievement of such performance goals.
PAYMENT OF AWARD
An Award (if any) to any Executive for a Plan Year will be paid in a single
lump sum in cash as soon as practicable after the end of the Plan Year,
provided, however, that the Board Committee shall have first certified in
writing, (i) that a performance goal with respect to such Executive for such
Plan Year was satisfied and the level of such goal attained, and (ii) the amount
of each such Executive's Award. If an Executive dies after the end of a Plan
Year but before receiving payment of any Award, the amount will be paid to a
designated beneficiary or, if no beneficiary has been designated, to the
Executive's estate. Notwithstanding the foregoing, the Board Committee may
determine by separate employment agreement with any Executive or otherwise, that
all or a portion of an Executive's Award for a Plan Year will be payable to such
Executive upon his death, disability, or termination of employment with the
Company, or upon a change of control of the Company, during the Plan Year.
NON-TRANSFERABILITY
No Awards or rights under the Executive Bonus Plan may be transferred or
assigned other than by will or by the laws of descent and distribution.
AMENDMENTS AND TERMINATION
The Board may terminate the Executive Bonus Plan and may amend it from time
to time; provided, however, that no termination or amendment of the Executive
Bonus Plan will adversely affect the rights of an Executive or a beneficiary to
a previously certified Award. Amendments to the Executive Bonus Plan may be made
without shareholder approval except as required to satisfy Section 162(m) of the
Code.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of certain Federal income tax aspects with
respect to the Executive Bonus Plan based upon the laws in effect on the date
hereof.
Upon payment of an Award to an Executive for any Plan Year pursuant to the
Executive Bonus Plan, such Executive will recognize ordinary income in the
amount of such Award on the date such compensation is paid.
The Company will generally be entitled to a deduction in the amount taxable
as ordinary income to an Executive, subject to the limitation imposed by Section
162(m) of the Code. The Company intends that
16
<PAGE> 20
compensation paid to an Executive pursuant to the Executive Bonus Plan will
generally qualify as "performance-based compensation" under Section 162(m) of
the Code and, consequently, should generally not be subject to the $1 million
deduction limit thereunder.
The foregoing is based upon Federal tax laws and regulations as presently
in effect and does not purport to be a complete description of the Federal
income tax aspects of the Executive Bonus Plan. Also, the specified state and
local tax consequences to an Executive and the Company may vary, depending upon
the laws of the various states and localities and the individual circumstances
of the Executive.
NEW PLAN BENEFITS
The amount of benefits payable in the future under the Executive Bonus Plan
is not currently determinable. However, for 1998 the Company paid a bonus of
$150,000 under the Executive Bonus Plan to Gerald J. Kapalko, Executive Vice
President and President, Olsten Latin America.
REQUIRED VOTE
In voting on approval of the Executive Bonus Plan, the shares of Common
Stock and Class B Common Stock shall vote together as one class with each share
of Common Stock entitled to one vote and each share of Class B Common Stock
entitled to ten votes. Approval of the Executive Bonus Plan requires the
affirmative vote by the holders of a majority of the votes represented by the
shares of Common Stock and Class B Common Stock, voting as a single class,
present in person or by proxy at the meeting. Unless marked to the contrary,
proxies received will be voted for the approval of the Executive Bonus Plan.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE APPROVAL
OF THE EXECUTIVE BONUS PLAN.
PROPOSAL 3
APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed PricewaterhouseCoopers LLP as
independent accountants of the Company for the 1999 fiscal year, subject to
ratification and approval by the shareholders. In voting on such ratification
and approval, the shares of Common Stock and Class B Common Stock shall vote
together as one class with each share of Common Stock entitled to one vote and
each share of Class B Common Stock entitled to ten votes.
PricewaterhouseCoopers LLP, by virtue of its predecessor firm, Coopers &
Lybrand LLP, has audited the accounts of the Company since 1967. The Company has
been advised that a representative of PricewaterhouseCoopers LLP will be present
at the meeting and will have an opportunity to make a statement and to answer
appropriate questions posed by shareholders.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR RATIFICATION
AND APPROVAL OF PRICEWATERHOUSECOOPERS LLP.
17
<PAGE> 21
PROPOSAL 4
SHAREHOLDER PROPOSAL TO ELIMINATE STOCK OPTIONS, BONUSES AND
RESTRICTED SHARES FOR TOP SENIOR MANAGEMENT
The Company is informed that Ruthellen Miller, 23 Park Circle, Great Neck,
New York 11024, owner of 500 shares of the Company's Common Stock, intends to
introduce the following proposal at the Annual Meeting:
Resolved "that as soon as practicable, and in conformity with contractual
obligations, that the board of directors will take under consideration that all
members of top corporate management listed in the proxy statement as the
companies chief executive officer and the other four most highly compensated
executive officers no longer be remunerated with stock options, bonuses, or
restricted shares.
Supporting Statement
The major rationale for offering stock options and bonuses to management is
that they provide a major incentive for management to insure corporate
profitability. These forms of management compensation are designed as rewards
for achievement in corporate profitability and long term growth. I believe that
in many instances bonuses, options, and restricted shares are given for
corporate performances which range from poor, to mediocre, to adequate
profitability.
However, the essential thrust of this resolution is that those members of
management that hold a significant share of company assets should not require
additional monetary incentives as motivators to insure corporate profitability.
Any reasonable individual would understand that growth and corporate
profitability would directly accrue to the shareholders including the executives
indicated in the resolution above. How many more motivators do they require?
In my opinion these unnecessary incentives become a raid on corporate
assets and hardly meet the standards of reasonableness and fairness. I believe
that compensation of this type are hardly a rationale for inducing higher levels
of performance of management.
I believe those members of management who are supremely confident in their
abilities to expand corporate profitability and desire a greater share in its
success are always free to buy stock on the open market, taking the same risks
as the common shareholder.
------------------------
BOARD OF DIRECTORS' RECOMMENDATION
Your Board of Directors believes this proposal to be against the best
interests of our shareholders and recommends that you vote against the proposal.
The proposal is contrary to common and competitive compensation practices
throughout corporate America.
The proposal requests the Board of Directors to stop remunerating the
Company's chief executive officer and top four most highly compensated executive
officers with stock options, bonuses or restricted shares as soon as possible.
The Compensation Committee of the Board of Directors reviews the compensation of
the Company's executive officers in light of market conditions, the Company's
performance and other factors and has developed an executive compensation
program that we believe motivates and rewards the Company's executives to
enhance Company performance in order to maximize shareholder value. The program
provides these incentives by linking a portion of each executive's compensation
to the Company's financial performance. This is done by granting equity-based
awards such as stock options and making bonus payments that depend on the extent
to which the Company is successful in achieving significant financial and
non-financial
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<PAGE> 22
goals. With these types of awards, the interests of the Company's executives are
united with the interests of the Company's shareholders.
We believe that the Company's executive compensation program is
competitive, allowing the Company to attract and, especially, to retain
talented, experienced management. If our compensation program does not remain
competitive, we believe the Company will be less successful in attracting and
retaining the executive talent we need.
Inflexible requirements regarding compensation, as contemplated by this
proposal, are not in the best interests of the shareholders. We, therefore, urge
you to vote against it.
REQUIRED VOTE
In voting on Proposal 4, the shares of Common Stock and Class B Common
Stock shall vote together as one class with each share of Common Stock entitled
to one vote and each share of Class B Common Stock entitled to ten votes.
Approval of the proposal requires the affirmative vote by the holders of a
majority of the votes represented by the shares of Common Stock and Class B
Common Stock, voting as a single class, present in person or by proxy at the
meeting. Unless marked to the contrary, proxies received will be voted against
the proposal.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS OF THE COMPANY VOTE
AGAINST PROPOSAL 4.
PROPOSAL 5
SHAREHOLDER PROPOSAL TO REQUIRE SHAREHOLDER APPROVAL
OF CHANGE OF CONTROL AGREEMENTS
The Company is informed that Glenn Freedman, 10 Kenilworth Road, Rye, New
York 10580, owner of 300 shares of the Company's Common Stock, intends to
introduce the following proposal at the Annual Meeting:
"RESOLVED, that the shareholders recommend that the board of directors
adopt a policy against entering into future agreements with officers and
directors of this corporation which provide compensation contingent on a
change of control of the corporation, unless such compensation agreements
are submitted to a vote of the shareholders and approved by a majority of
shares present and voting on the issue."
SUPPORTING STATEMENT
Lucrative severance contracts awarded to senior corporate executives which
provide compensation contingent on a change of control, usually through a merger
or acquisition of the corporation, are known as "golden parachutes". These
contracts are awarded without shareholder approval.
The practice of providing these large cash awards to a small group of
senior corporate managers without shareholder approval has been a subject of
public outcry. In 1988, the U.S. Senate in emphasizing the potential conflict of
interest between management and shareholders created by these agreements voted
ninety eight to one to require shareholder approval of golden parachutes which
exceed three times annual compensation.
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<PAGE> 23
Although final action was not taken, it is clear to me that the
overwhelming vote in favor of the measure reflects public sentiment against
golden parachutes. A shareholder vote would allow the corporation's owners to
decide for themselves whether golden parachutes are in their best interests.
It is clear to me that requiring a shareholder vote is necessary to address
the conflicts of interest between management and shareholders that arise in the
awarding of golden parachutes.
I URGE YOUR SUPPORT, VOTE FOR THIS RESOLUTION
------------------------
BOARD OF DIRECTORS' RECOMMENDATION
Your Board of Directors believes that this proposal is detrimental to
shareholders' interests and would weaken the ability of our Company to be
effectively managed at critical times. The proposal is contrary to a common
corporate business practice throughout corporate America.
The proposal requests the Board of Directors to refrain from entering into
change of control severance agreements with officers and directors of the
Company unless those agreements are approved in advance by shareholders. Change
of control agreements, when used judiciously under the appropriate
circumstances, benefit shareholders because they provide security to key
employees if a change of control presents itself. These employees would then be
able to focus, without personal concern, on negotiating the best possible deal
for shareholders and also secure a smooth transition if a new management team
were desired. Rather than creating a conflict of interest, these agreements
align the interests of management and shareholders.
In addition, attracting and retaining talented management in the wake of a
change of control is a priority interest of our shareholders. In order to
accomplish this goal, competitive severance agreements must be offered to top
management. Otherwise, retaining high quality, key employees, of which this
Company has several, could become difficult at a critical time and an exodus of
talent might occur. Requiring shareholder approval of these agreements would
prevent the Board from being able to act quickly and decisively in time
pressured situations and, in certain cases, would necessitate the significant
added cost of holding a special meeting of shareholders. We believe that we
should retain the flexibility to use severance agreements so that we may best
serve our shareholders.
REQUIRED VOTE
In voting on Proposal 5, the shares of Common Stock and Class B Common
Stock shall vote together as one class with each share of Common Stock entitled
to one vote and each share of Class B Common Stock entitled to ten votes.
Approval of the proposal requires the affirmative vote by the holders of a
majority of the votes represented by the shares of Common Stock and Class B
Common Stock, voting as a single class, present in person or by proxy at the
meeting. Unless marked to the contrary, proxies received will be voted against
the proposal.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS OF THE COMPANY VOTE
AGAINST PROPOSAL 5.
20
<PAGE> 24
PROPOSAL 6
SHAREHOLDER PROPOSAL REQUESTING PROMPT SALE
OF THE COMPANY TO THE HIGHEST BIDDER
The Company is informed that William Steiner, 4 Radcliff Drive, Great Neck,
New York 11024, owner of 2,300 shares of the Company's Common Stock, intends to
introduce the following proposal at the Annual Meeting:
Resolved that the shareholders of Olsten Corporation urge the Olsten
Corporation Board of Directors to arrange for the prompt sale of Olsten
Corporation to the highest bidder.
The purpose of the Maximize Value Resolution is to give all Olsten
Corporation shareholders the opportunity to send a message to the Olsten
Corporation Board that they support the prompt sale of Olsten Corporation to the
highest bidder. A strong and or majority vote by the shareholders would indicate
to the board the displeasure felt by the shareholders of the shareholder returns
over many years and the drastic action that should be taken. Even if it is
approved by the majority of the Olsten Corporation shares represented and
entitled to vote at the annual meeting, the Maximize Value Resolution will not
be binding on the Olsten Corporation Board. The proponent however believes that
if this resolution receives substantial support from the shareholders, the board
may choose to carry out the request set forth in the resolution:
The prompt auction of Olsten Corporation should be accomplished by any
appropriate process the board chooses to adopt including a sale to the highest
bidder whether in cash, stock, or a combination of both. It is expected that the
board will uphold its fiduciary duties to the utmost during the process.
The proponent further believes that if the resolution is adopted, the
management and the board will interpret such adoption as a message from the
company's stockholders that it is no longer acceptable for the board to continue
with its current management plan and strategies.
I URGE YOUR SUPPORT, VOTE FOR THIS RESOLUTION
------------------------
BOARD OF DIRECTORS' RECOMMENDATION
Your Board of Directors believes that this proposal is against the
financial interests of our shareholders and recommends that you vote against the
proposal.
The proposal urges the Board of Directors to seek the prompt sale of the
Company to the highest bidder. A prompt sale of the Company to the highest
bidder would not necessarily enable shareholders to realize the true value of
the Company. At times, a company's market value can be significantly different
from its intrinsic value. We believe that the long term potential of the Company
is greater than the current market price.
Furthermore, an announcement that the proposal is adopted could harm the
Company's relationships with key constituents by creating uncertainty about our
ability and intention to meet customers' service requirements and retain
employees. The Company would be at a competitive disadvantage in pursuing longer
term customer contracts. In this event, sales and profits could decline and,
consequently, so might shareholder value.
The Board is elected by the shareholders and is composed of individuals
familiar with the Company's business and its industry. We continually review and
monitor the Company's business and progress consistent with our fiduciary
duties. Because we are in the best position to make decisions about the Company,
we should retain full discretion to consider all possible strategic alternatives
and be able to select the best time for their implementation. A mandate for the
prompt sale of the Company could seriously prejudice shareholders' financial
interests.
21
<PAGE> 25
We have always acted and will continue to act in what we consider to be the
best interests of our shareholders. We do not believe that this shareholder
proposal will maximize shareholder value and, therefore, we oppose it.
REQUIRED VOTE
In voting on Proposal 6, the shares of Common Stock and Class B Common
Stock shall vote together as one class with each share of Common Stock entitled
to one vote and each share of Class B Common Stock entitled to ten votes.
Approval of the proposal requires the affirmative vote by the holders of a
majority of the votes represented by the shares of Common Stock and Class B
Common Stock, voting as a single class, present in person or by proxy at the
meeting. Unless marked to the contrary, proxies received will be voted against
the proposal.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS OF THE COMPANY VOTE
AGAINST PROPOSAL 6.
PROPOSALS OF SHAREHOLDERS
Proposals of shareholders intended for inclusion in the Company's proxy
statement and form of proxy for the 2000 Annual Meeting must be received by the
Company by December 15, 1999.
In addition, notice of any proposal that a shareholder desires to propose
for consideration at the 2000 Annual Meeting, but does not seek to include in
the Company's 2000 Proxy Statement, must be received by the Company no later
than February 28, 2000, if the shareholder desires that the Company describe the
nature of the proposal in the 2000 Proxy Statement as a condition to exercising
its discretionary authority to vote proxies on that proposal.
GENERAL
A COPY OF THE ANNUAL REPORT ON FORM 10-K FILED BY THE COMPANY WITH THE
SECURITIES AND EXCHANGE COMMISSION FOR ITS LAST FISCAL YEAR IS AVAILABLE WITHOUT
CHARGE TO SHAREHOLDERS UPON WRITTEN REQUEST TO LAURIN L. LADEROUTE, JR.,
SECRETARY, OLSTEN CORPORATION, 175 BROAD HOLLOW ROAD, MELVILLE, NEW YORK
11747-8905.
The cost of solicitation of proxies will be borne by the Company. The Board
of Directors may use the services of individual Directors, as well as officers
and others, to solicit personally or by telephone. Arrangements may also be made
with brokerage houses and other custodians, nominees and fiduciaries to forward
solicitation material to the beneficial owners of the stock held of record by
such persons and the Company may reimburse them for reasonable out-of-pocket
expenses incurred by them in doing so.
The Board of Directors knows of no other matters that may come before the
meeting. If any other matters should be brought before the meeting for action,
it is the intention of the persons named in the proxy to vote in accordance with
their discretion pursuant to authority conferred by the proxy.
By Order of the Board of Directors
LAURIN L. LADEROUTE, JR.
Secretary
Dated: April 13, 1999
Melville, New York
22
<PAGE> 26
EXHIBIT A
OLSTEN CORPORATION
EXECUTIVE OFFICERS BONUS PLAN
SECTION 1. Purpose.
Olsten Corporation (the "Company") hereby establishes, subject to
shareholder approval, this Executive Officers Bonus Plan (the "Plan") in order
to provide the Company's executive officers with an opportunity to earn annual
bonus compensation, contingent on the achievement of certain performance goals,
as an incentive and reward for their leadership, ability and exceptional
services.
SECTION 2. Definitions.
2.1 "Award" means the amount of bonus compensation to which an Eligible
Employee is entitled for each Plan Year as determined by the Committee pursuant
to Section 4 of the Plan.
2.2 "Code" means the Internal Revenue Code of 1986, as amended, including
applicable regulations thereunder.
2.3 "Committee" means a committee of the Company's Board of Directors (the
"Board") consisting of not less than two persons who, to the extent required to
satisfy the exception for performance-based compensation under Section 162(m) of
the Code are "outside directors" within the meaning of such section. The members
of the Committee shall serve at the pleasure of the Board.
2.4 "Determination Date" means the day immediately preceding the first day
of a Plan Year or such later date by which the Committee may establish
performance goals for a Plan Year without causing an Award to be treated as
other than performance-based compensation within the meaning of Section 162(m)
of the Code.
2.5 "Eligible Employee" means any executive officer of the Company.
2.6 "Plan Year" means a fiscal year of the Company.
SECTION 3. Administration.
The Plan shall be administered by the Committee. The Committee shall have
the authority to establish performance goals for the awarding of Awards for each
Plan Year; to determine the Eligible Employees to whom Awards are to be made for
each Plan Year; to determine whether performance goals for each Plan Year have
been achieved; to authorize payment of Awards under the Plan; to adopt, alter
and repeal such administrative rules, guidelines and practices governing the
Plan as it shall deem advisable; and to interpret the terms and provisions of
the Plan. All determinations made by the Committee with respect to the Plan and
Awards thereunder shall be final and binding on all persons, including the
Company and all Eligible Employees.
SECTION 4. Determination of Awards.
The amount of an Award for any Plan Year shall be an amount not greater
than the lesser of 200% of such Eligible Employee's annual base salary or $2.5
million, which amount shall be determined based on the achievement of one or
more performance goals established by the Committee with respect to such
Eligible Employee. Performance goals may vary from Eligible Employee to Eligible
Employee and shall be based upon such one or more of the following performance
criteria as the Committee may deem appropriate: appreciation in share value,
total shareholder return, earnings per share, operating income, net income, pro
forma net
A-1
<PAGE> 27
income, return on equity, return on designated assets, return on capital,
economic value added, earnings, revenues, expenses, operating profit margin,
operating cash flow, gross profit margin, net profit margin, employee turnover,
employee headcount, labor costs, customer service and accounts receivable. The
performance goals may be determined by reference to the performance of the
Company, or of a subsidiary or affiliate, or of a division or unit of any of the
foregoing. No later than the Determination Date, the Committee shall establish
(i) the Eligible Employees who shall be eligible for an Award for such Plan
Year, (ii) the Eligible Employee's annual base salary for purposes of
determining the amount of such Eligible Employee's Award for such Plan Year,
(iii) the performance goals for such Plan Year, and (iv) the corresponding Award
amounts payable under the Plan upon achievement of such performance goals.
SECTION 5. Payment of Award.
An Award (if any) to any Eligible Employee for a Plan Year shall be paid in
a single lump sum in cash as soon as practicable after the end of the Plan Year,
provided, however, that the Committee shall have first certified in writing (i)
that a performance goal with respect to such Eligible Employee for such Plan
Year was satisfied and the level of such goal attained, and (ii) the amount of
each such Eligible Employee's Award. If an Eligible Employee dies after the end
of a Plan Year but before receiving payment of any Award, the amount of such
Award shall be paid to a designated beneficiary or, if no beneficiary has been
designated, to the Eligible Employee's estate, in the form of a lump sum payment
in cash as soon as practicable after the Award for the Plan Year has been
determined and certified in accordance with this Section 5. Notwithstanding the
foregoing, the Committee may determine, by separate employment agreement with
any Eligible Employee or otherwise, that all or a portion of an Award for a Plan
Year shall be payable to the Eligible Employee upon the Eligible Employee's
death, disability or termination of employment with the Company, or upon a
change of control of the Company, during the Plan Year.
SECTION 6. Non-transferability.
No Award or rights under this Plan may be transferred or assigned other
than by will or by the laws of descent and distribution.
SECTION 7. Amendments and Termination.
The Board may terminate the Plan at any time and may amend it from time to
time, provided, however, that no termination or amendment of the Plan shall
adversely affect the rights of an Eligible Employee or a beneficiary to a
previously certified Award. Amendments to the Plan may be made without
shareholder approval except as required to satisfy Section 162(m) of the Code.
SECTION 8. General Provisions.
8.1 Nothing set forth in this Plan shall prevent the Board from adopting
other or additional compensation arrangements. Neither the adoption of the Plan
nor any Award hereunder shall confer upon an Eligible Employee any right to
continued employment.
8.2 No member of the Board or the Committee, nor any officer or employee of
the Company acting on behalf of the Board or the Committee, shall be personally
liable for any action, determination or interpretation taken or made with
respect to the Plan, and all members of the Board or the Committee and all
officers or employees of the Company acting on their behalf shall, to the extent
permitted by law, be fully indemnified and protected by the Company in respect
of any such action, determination or interpretation.
SECTION 9. Effective Date of Plan.
The Plan shall become effective on January 3, 1994, subject to approval by
the shareholders of the Company at a meeting duly called and held within twelve
months following the effective date of the Plan.
A-2
<PAGE> 28
COMMON STOCK
[OLSTEN CORPORATION LOGO]
175 Broad Hollow Road
Melville, New York
PROXY
SOLICITED BY THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS
OF OLSTEN CORPORATION
The undersigned hereby appoints Edward A. Blechschmidt, Stuart Olsten and
Laurin L. Laderoute, Jr., jointly and severally, proxies, with full power of
substitution to represent the undersigned and vote all shares of Common Stock of
Olsten Corporation (the "Company") which the undersigned is entitled to vote at
the Annual Meeting of Shareholders of the Company to be held at 175 Broad Hollow
Road, Melville, New York on Tuesday, May 4, 1999 at 9:00 a.m., and at any
adjournments thereof, upon the following matters and upon such other matters as
may properly come before the meeting:
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE
SHAREHOLDER. IF NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR PROPOSALS
1, 2 AND 3 AND AGAINST PROPOSALS 4, 5 AND 6 AND IN ACCORDANCE WITH THE
DISCRETION OF THE PROXIES ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE
MEETING.
CONTINUED, AND TO BE VOTED, SIGNED AND DATED ON THE REVERSE SIDE.
-FOLD AND DETACH HERE-
<PAGE> 29
IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR Please mark
PROPOSALS 1, 2 AND 3 AND AGAINST PROPOSALS 4, 5 AND 6. your votes as
indicated in
this example [X]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1, 2 AND 3.
1. Election of Directors:
WITHHOLD
FOR all nominees AUTHORITY
(except as marked) for all nominees
[ ] [ ]
2. Approve Executive Officers Bonus Plan.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
Nominees to be elected by holders of Common Stock: Edward A. Blechschmidt, John
M. May and Josh S. Weston
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- -------------------------------------------------------------------------
3. Approve PricewaterhouseCoopers LLP as independent accountants for 1999.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSALS 4, 5 AND 6.
FOR AGAINST ABSTAIN
4. Shareholder proposal to eliminate
stock options, bonuses and restricted
shares for top senior management. [ ] [ ] [ ]
5. Shareholder proposal to require
shareholder approval of change of
control agreements. [ ] [ ] [ ]
6. Shareholder proposal requesting
prompt sale of company. [ ] [ ] [ ]
7. In their discretion, upon such other matters as may properly come before the
meeting.
Please mark, date and sign as your name appears hereon and return in the
enclosed envelope. If acting as executor, administrator, trustee, etc. please so
indicate when signing. If the signer is a corporation, please sign the full
corporate name by duly authorized officer. If shares are held jointly, each
shareholder should sign. If a partnership, please sign in partnership name by
authorized person.
Dated: , 1999
-----------------------------------------
- ------------------------------------------------
(Signature)
- ------------------------------------------------
(Signature, if held jointly)
-FOLD AND DETACH HERE-
<PAGE> 30
CLASS B COMMON STOCK
[OLSTEN CORPORATION
LOGO]
175 Broad Hollow Road
Melville, New York 11747-8905
PROXY
SOLICITED BY THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS
OF OLSTEN CORPORATION
The undersigned hereby appoints Edward A. Blechschmidt, Stuart Olsten and
Laurin L. Laderoute, Jr., jointly and severally, proxies, with full power of
substitution to represent the undersigned and vote all shares of Class B Common
Stock of Olsten Corporation (the "Company") which the undersigned is entitled to
vote at the Annual Meeting of Shareholders of the Company to be held at 175
Broad Hollow Road, Melville, New York on Tuesday, May 4, 1999 at 9:00 a.m., and
at any adjournments thereof, upon the following matters and upon such other
matters as may properly come before the meeting:
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE
SHAREHOLDER. IF NO DIRECTION IS GIVEN, SUCH SHARES WILL BE VOTED FOR PROPOSALS
1, 2 AND 3 AND AGAINST PROPOSALS 4, 5 AND 6 AND IN ACCORDANCE WITH THE
DISCRETION OF THE PROXIES ON ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE
MEETING.
CONTINUED, AND TO BE VOTED, SIGNED AND DATED ON THE REVERSE SIDE.
- FOLD AND DETACH HERE -
<PAGE> 31
IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR PLEASE MARK
PROPOSALS 1, 2 AND 3 AND AGAINST PROPOSALS 4, 5 AND 6. YOUR VOTES AS
INDICATED IN
THIS EXAMPLE [X]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1, 2 AND 3.
1. Election of Directors:
WITHHOLD
FOR all nominees AUTHORITY
(except as marked) for all nominees
[ ] [ ]
2. Approve Executive Officers Bonus Plan.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
Nominees to be elected by holders of Class B Common Stock: Victor F. Ganzi,
Stuart R. Levine, Miriam Olsten, Stuart Olsten, Richard J. Sharoff and
Raymond S. Troubh.
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- -------------------------------------------------------------------------
3. Approve PricewaterhouseCoopers LLP as independent accountants for 1999.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSALS 4, 5 AND 6.
FOR AGAINST ABSTAIN
4. Shareholder proposal to eliminate
stock options, bonuses and restricted
shares for top senior management. [ ] [ ] [ ]
5. Shareholder proposal to require
shareholder approval of change of
control agreements. [ ] [ ] [ ]
6. Shareholder proposal requesting
prompt sale of company. [ ] [ ] [ ]
7. In their discretion, upon such other matters as may properly come before the
meeting.
Please mark, date and sign as your name appears hereon and return in the
enclosed envelope. If acting as executor, administrator, trustee, etc. please so
indicate when signing. If the signer is a corporation, please sign the full
corporate name by duly authorized officer. If shares are held jointly, each
shareholder should sign. If a partnership, please sign in partnership name by
authorized person.
Dated: , 1999
-----------------------------------------
- ------------------------------------------------
(Signature)
- ------------------------------------------------
(Signature, if held jointly)
-FOLD AND DETACH HERE-
