SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of Commission Only
(as permitted by Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
Analytical Surveys, Inc.
------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of filing fee (Check the appropriate box):
[ X ] No filing fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
Analytical Surveys, Inc.
941 North Meridian Street
Indianapolis, Indiana 46204
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
February 16, 2000
Notice is hereby given that an Annual Meeting of Shareholders of
Analytical Surveys, Inc. ("Company" or "ASI"), a Colorado corporation, will be
held on February 16, 2000 at 3:30 p.m. MST at the Antlers Adam's Mark Hotel, 4
South Cascade Avenue, Colorado Springs, Colorado. The purpose of the Annual
Meeting is to:
Elect six Directors to serve until the next Annual Meeting of
the Shareholders and until the election and qualification of
their respective successors;
2. Ratify the selection of KPMG LLP as the independent auditors
for the Company for the fiscal year ending September 30, 2000;
and
3. Act upon such other business as may properly come before the
Annual Meeting or any adjournment or postponement thereof.
The Company's Board of Directors has fixed the close of business on
January 6, 2000, as the record date for determining those shareholders who will
be entitled to notice of and to vote at the Annual Meeting.
Representation of at least a majority of all outstanding shares of
common stock of the Company is required to constitute a quorum. Accordingly, it
is important that your stock be represented at the meeting.
A Proxy Statement explaining the matters to be acted upon at the
meeting is enclosed. Also enclosed is a copy of our Annual Report for the fiscal
year ended September 30, 1999.
Whether or not you plan to attend the meeting, please complete, date
and sign the enclosed proxy card and return it in the enclosed envelope. Your
proxy may be revoked at any time prior to the time it is voted.
By Order of the Board of Directors
/s/ Vincent J. Otto
--------------------
Vincent J. Otto
Secretary/Treasurer
January 14, 2000
<PAGE>
Analytical Surveys, Inc.
941 North Meridian Street
Indianapolis, Indiana 46204
PROXY STATEMENT
Annual Meeting of Shareholders
to be held on February 16, 2000
This Proxy Statement is submitted with the Notice of the Annual Meeting of
Shareholders of Analytical Surveys, Inc. ("Company" or "ASI") to be held on
February 16, 2000 at 3:30 p.m. MST at Antlers Adam's Mark Hotel, 4 South Cascade
Avenue, Colorado Springs, Colorado.
The purpose of the Annual Meeting is to:
1. Elect six Directors to serve until the next Annual Meeting of the
Shareholders and until the election and qualification of their
respective successors;
2. Ratify the selection of KPMG LLP as the independent auditors for
the Company for the fiscal year ending September 30, 2000; and
3. Act upon such other business as may properly come before the
meeting or any adjournment or postponement thereof.
Each of the foregoing proposals is described in more detail in this Proxy
Statement.
Proxies and Voting At the Annual Meeting
This solicitation of proxies is made on behalf of the Board of
Directors of the Company (the "Board of Directors" or the "Board").
The Proxy Statement and the proxies solicited hereby are being first
sent or delivered to shareholders of the Company beginning on or about January
14, 1999.
The expenses of the solicitation of proxies for the meeting will be
paid by the Company. Employees of the Company may communicate with shareholders
to solicit their proxies. Brokers, banks and others holding stock in their
names, or in names of nominees, may request and forward copies of the proxy
solicitation material to beneficial owners and seek authority for execution of
proxies, and the Company will reimburse them for their expenses in so doing at
the rates approved by the New York Stock Exchange.
The holders of record of the Company's common stock at the close of
business on January 6, 2000, will be entitled to notice of, and to vote at, the
meeting. Each share of common stock represented at the Annual Meeting is
entitled to one vote on each matter properly brought before the meeting. There
are no cumulative voting rights. Please specify your choices by marking the
appropriate boxes on the enclosed proxy card and signing it.
In the election of directors, the six nominees who receive the highest
number of votes cast are elected to the Board of Directors. All other matters
submitted at the meeting will be determined by a majority of the votes cast.
Shares represented by proxies that are marked "withhold authority" with respect
to the election of one or more nominees for election as directors, proxies which
are marked "abstain" on other proposals and proxies that are marked to deny
discretionary authority on other matters will not be counted in determining the
number of votes cast
<PAGE>
for such matters. If no directions are given and the signed proxy card is
returned, the shares will be voted in favor of the election of all listed
nominees, in favor of the ratification of the selection of KPMG LLP as the
independent auditors of the Company, and at the proxies' discretion on any other
matter that may properly come before the meeting. In instances where brokers are
prohibited from exercising discretionary authority for beneficial owners who
have not returned proxies to the brokers (so-called "broker non-votes"), those
shares will be counted for the purpose of determining if a quorum is present but
will not be included as votes cast and, therefore, will have no effect on the
vote. Shareholders voting by proxy may revoke that proxy at any time before it
is voted at the meeting by delivering to the Company a proxy bearing a later
date or by attending in person and casting a ballot.
On the record date, January 6, 2000, there were 6,953,190 shares of
common stock outstanding and entitled to vote. The presence in person or by
proxy of at least a majority of the outstanding shares will constitute a quorum.
YOUR VOTE IS IMPORTANT. PLEASE RETURN YOUR MARKED PROXY CARD PROMPTLY SO
YOUR SHARES CAN BE REPRESENTED, EVEN IF YOU PLAN TO ATTEND THE MEETING IN
PERSON.
2
<PAGE>
Election of Directors
(Item 1 on Proxy Card)
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL NOMINEES
The Board of Directors has determined that effective at the Annual
Meeting the number of Directors of the Company shall be six. Each Director will
serve until the next Annual Meeting of Shareholders or until a qualified
successor is elected. All of the nominees are presently Directors of the
Company. We will vote your shares as specified on the enclosed proxy card. If
you do not specify how you want your shares voted, we will vote them FOR the
election of all the nominees named below. If any such person should be unable to
serve or become unavailable for any reason, or if a vacancy should occur before
the election (which events are not anticipated), we will vote your shares FOR
such other person or persons as shall be determined by the persons named in the
Proxy in accordance with their judgment. The nominees have provided the
following information about themselves as of December 12, 1999.
Sidney V. Corder, 57, has been the President of the Company since
August 1990 and the Chief Executive Officer since 1993. He has served as a
director of the Company since November 1992 and has been the Chairman of the
Board of the Company since March 1997. From 1979 until joining the Company in
1990, Mr. Corder was employed by Cubic Corporation, a design/build manufacturer
of electronic systems and products, serving in various capacities including as
Vice President of Operations and as President of its Western Data division.
Willem H. J. Andersen, 58, has served as a director of the Company
since October 1995. Since November 1998 he has served as CEO of Intermezzo
Systems, Inc., a software development company in the hospitality industry. From
February 1995 to November 1998, he was a consultant with A&S Consulting Ltd.
From 1992 to February 1995, he served as President and Chief Executive Officer
of Comlinear Corporation, a subsidiary of National Semiconductor Corporation.
From 1970 until his retirement in 1992, Mr. Andersen held various positions with
a number of divisions of Phillips N.V. of the Netherlands, including President
and Chief Executive Officer of Laser Magnetic Storage International Company, a
North American Phillips company.
Dr. Robert H. Keeley, 58, has served as a director of the Company since
December 1992. Since September 1992, Dr. Keeley has been the El Pomar Professor
of Business Finance at the College of Business and Administration, University of
Colorado at Colorado Springs, where he also is associated with the Colorado
Institute for Technology Transfer and Implementation. Dr. Keeley also currently
serves on the boards of directors of Simtek Corporation, a developer of
high-performance nonvolatile semiconductor memories, and of several private
companies.
Richard P. MacLeod, 62, has served as a director of the Company since
December 1987. From May 1985 until his retirement in April 1997, Mr. MacLeod was
President of the United States Space Foundation, a private foundation. He served
24 years in the U.S. Air Force, most recently as Chief of Staff, North American
Aerospace Defense Command, and as the first Air Force Space Command Chief of
Staff.
Sol C. Miller, 62, has served as a director of the Company since August
1997. He was a co-founder of MSE Corporation and was Chairman of the Board from
1960 until its acquisition by the Company in July 1997. He is the president of
SCM Real Estate Development Corporation.
Dr. James T. Rothe, 56, has served as a director of the Company since
December 1987. Dr. Rothe has been a Professor of Business at the College of
Business and Administration, University of Colorado at Colorado Springs since
August 1986, where he served as Dean until June 1994. Since 1988, Dr. Rothe has
been a principal in Phillips- Smith Specialty Retail, Inc., a venture capital
firm. He is a director of Medlogic Global Corporation, which develops medical
devices for the wound-management market. He is a director of NeoCone, LLC, an
information technology company. He is also a trustee of the Janus Funds.
3
<PAGE>
John A. Thorpe, 65, the founder of ASI, has served as a director of the
Company since February 1981. Mr. Thorpe has decided to retire at the end of his
term which expires at the Annual Meeting.
Board of Directors
Director Compensation
Non-employee "outside" directors receive an annual retainer of $6,500,
plus a fee of $2,000 per meeting of the Board of Directors and $1,500 for each
meeting of a Committee of the Board that does not occur on the same day as a
Board meeting. Chairpersons of committees receive an additional annual fee of
$3,000 for serving as committee chair. Directors who are also employees of the
Company do not receive any additional compensation for their service as
directors.
Outside directors also participate in the Analytical Surveys, Inc. 1993
Non-Qualified Stock Option Plan. Under this plan, each year for the life of the
plan each outside director is granted options to purchase 9,000 shares of
Company common stock at an exercise price equal to the fair market value at the
date of grant.
Mr. Miller also received an annual consulting fee as a consultant to
the Company. In the initial agreement, such fee was $150,000 per year beginning
July 1997 for one year, plus medical benefits. In July 1998, the agreement was
extended to July 1999 and the fee was reduced to $100,000, plus medical
benefits. In addition, the Company paid premiums on a life insurance policy
payable to his designated beneficiaries. The amounts paid by the Company
pursuant to these arrangements in fiscal 1999 were $84,165. Mr. Miller's
consulting services were concluded with the July 1999 expiration of the
agreement.
Directors' Meetings and Committees
The Board of Directors met six times during the fiscal year. Each
Director attended at least 75 percent of the aggregate number of meetings of the
Board of Directors and each committee of which he is a member.
The Compensation Committee is chaired by Richard P. MacLeod with
Messrs. Andersen, Keeley and Rothe as members. The Compensation Committee
reviews and recommends to the Board salary and incentive compensation, including
bonus, stock options and restricted stock for the Chief Executive Officer;
reviews and approves the salaries and incentive compensation for all corporate
officers and senior executives; and advises the Board with respect to the
incentive compensation to be allocated to employees. The Compensation Committee
does not include any employees or former or current officers of the Company. The
Compensation Committee met three times during fiscal 1999.
The Audit Committee is chaired by Robert H. Keeley, with Messrs.
Andersen, MacLeod and Rothe as members. The Audit Committee recommends the
appointment of the Company's independent accountants; reviews the scope and
results of the audit plans of the independent accountants and the internal
auditors; oversees the scope and adequacy of the Company's internal accounting
control and record-keeping systems; reviews non-audit services to be performed
by the independent accountants; and determines the appropriateness of fees for
audit and non-audit services performed by the independent accountants. The Audit
Committee met once during fiscal 1999.
There is no nominating committee of the Board.
The Executive Committee of the Board of Directors is chaired by James
T. Rothe, with Messrs. Corder and Miller as members.
4
<PAGE>
Executive Officers
The following is certain information concerning the executive officers
of the Company, as of December 12, 1999, based on information furnished by them.
Sidney V. Corder
Chairman of the Board, President and Chief Executive Officer
Biographical information concerning Mr. Corder is set forth under
the heading "Election of Directors."
John J. Dillon, 40
Chief Administrative Officer
Mr. Dillon has been the Chief Administrative Officer of the
Company since July 1997. From January 1997 until its acquisition by the Company
in July 1997, Mr. Dillon was Senior Vice President of MSE Corporation. From July
1993 until January 1997, Mr. Dillon served as the Director of the Indiana State
Lottery. From January 1993 until July 1993 he served as a legislative liaison to
the Governor of Indiana.
Timothy A. Gregory, 41
Chief Marketing Officer
Mr. Gregory has been Chief Marketing Officer since November 1998.
From 1989 until joining the Company in November 1998 Mr. Gregory served in
various marketing positions of increasing responsibility with Ernst & Young LLP,
most recently as Director, National Marketing. Prior to that he held various
positions with IBM Corporation between 1983 and 1989.
David O. Hicks, 39
Chief Technical Officer
Mr. Hicks has been Chief Technical Officer since August 1998. From
1993 until joining the Company in August 1998 Mr. Hicks served in various
positions of increasing responsibility at GeoGraphix Incorporated, a developer
of Unix-based software applications for the oil and gas industry, most recently
as Senior Vice President, Product Development. Prior to that he held various
positions with Sierra Geophysics Incorporated between 1990 and 1993 and with
Exxon Company USA between 1985 and 1990.
Vincent J. Otto, 40
Chief Financial Officer and Secretary/Treasurer
Mr. Otto has been Chief Financial Officer and Secretary/Treasurer
of the Company since October 1999. From May 1996 to April 1999, Mr. Otto served
as Executive Vice President and Chief Financial Officer of The USA Group, Inc.,
an Indiana based originator and servicer of government guaranteed student loans.
Prior to that, Mr. Otto served in various financial and strategic capacities
with several public companies and start-up operations including American Equity
Investment Life Insurance Company and Younkers, Inc., a regional department
store chain. Mr. Otto began his career with Ernst & Young LLP. Mr. Otto is a
Certified Public Accountant.
5
<PAGE>
Executive Compensation
Summary Compensation Table
This table sets forth a summary of certain information regarding the
compensation of Sidney V. Corder, the Chief Executive Officer of the Company and
the three other executive officers and two former executive officers whose
salary and bonus exceeded $100,000 during fiscal 1999 (the "named executive
officers") for the fiscal years ended September 30, 1999, 1998, and 1997.
<TABLE>
<CAPTION>
Long
Term
Compensa-
tion
Annual Compensation Awards
------------------------------------------ ------
Name and Other Annual Stock All Other
Principal Salary Bonus Compensation(1) Options(2) Compensation
Position Year $ $ $ (#) $
---------- --- ------- --------- ------------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Sidney V. Corder ........................ 1999 298,461 -- -- -- 10,917(4)
Chairman of the Board, ............... 1998 239,393 656,040 -- 200,000 9,470
President and ........................ 1997 203,769 398,750 50,000(3) 50,000 8,643
Chief Executive Officer
John J. Dillon .......................... 1999 174,647 -- -- -- 2,087(5)
Chief Administrative ................. 1998 149,950 171,820 -- 60,000 2,695
Officer .............................. 1997 N/A N/A -- N/A N/A
Timothy A. Gregory ...................... 1999 150,384(6) 75,000 50,000(3) -- --
Chief Marketing ...................... 1998 N/A N/A -- 25,000 --
Officer .............................. 1997 N/A N/A --
David O. Hicks .......................... 1999 135,000 50,000 -- -- 2,582(7)
Chief Technical Officer .............. 1998 N/A N/A --
1997 N/A N/A --
Randal J. Sage(8) ....................... 1999 213,513 -- -- -- 3,910(9)
Executive Vice ....................... 1998 188,248 203,060 -- 60,000 2,527
President ............................ 1997 N/A N/A -- N/A N/A
Scott C. Benger(10) ..................... 1999 145,898 -- -- -- 2,364(11)
Senior Vice President- ............... 1998 162,527 249,920 50,000(3) 90,000 3,886
Finance .............................. 1997 123,154 203,000 -- 41,000 2,608
<FN>
(1) Certain perquisites and other personal benefits did not exceed the lesser of
$50,000 or 10% of the total amounts reported in the Salary and Bonus columns
in any of the fiscal years reported, except as indicated.
(2) Long term compensation consists only of stock options. There were no grants
of restricted stock or payments from other long term incentive plans,
therefore columns for "Restricted Stock Awards" and "LTIP Payouts" are
omitted.
(3) Paid as reimbursement for expenses incurred in connection with moving to
Indianapolis, Indiana.
(4) Other compensation for fiscal 1999 includes $6,016 in life insurance
premiums and employer's matching contributions to the 401(k) Incentive
Savings Plan of $4,901.
(5) Other compensation for fiscal 1999 includes employer's matching
contributions to the 401(k) Incentive Savings Plan of $2,087.
(6) Mr. Gregory began employment with the Company on November 2, 1998.
Accordingly, salary information included in the table represents only salary
from that date through September 30, 1999.
(7) Other compensation for fiscal 1999 includes employer's matching
contributions to the 401(k) Incentive Savings Plan of $2,582.
(8) Mr. Sage served as an executive officer during a portion of fiscal 1999.
(9) Other compensation for fiscal 1999 includes employer's matching
contributions to the 401(k) Incentive Savings Plan of $3,910.
(10)Mr. Benger served as an executive officer during a portion of fiscal 1999.
(11)Other compensation for fiscal 1999 includes employer's matching
contributions to the 401(k) Incentive Savings Plan of $2,364.
</FN>
</TABLE>
6
<PAGE>
Option Grants in Last Fiscal Year
This table sets forth certain information with respect to grants made
by the Company of stock options to the named executive officers during fiscal
1999. No stock appreciation rights ("SARs") were granted to the named executive
officers during fiscal 1999.
<TABLE>
<CAPTION>
Potential Realizable
Value(2) At Assumed Annual
% of Total Rates of Stock Appreciation
Options to Exercise for Option Term
Options Employees Price Expiration -------------------------------
Name Granted(1) in Fiscal Year ($/sh) Date 5% ($) 10% ($)
---- ---------- -------------- ------ ---- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Sidney V. Corder --
John J. Dillon --
Timothy A. Gregory 25,000 9.7 25.13 11/2/08 395,024 1,001,069
David O. Hicks --
Randal J. Sage --
Scott C. Benger --
<FN>
(1) All options vest as follows: 25% at six months; 25% at one year; 25% at two
years; and 25% at three years after date of grant.
(2) "Potential Realizable Value" is calculated based on the assumption that the
price of the common stock will appreciate at the rates shown. The 5% and
10% assumed rates are mandated by the rules of the Securities Exchange
Commission and do not reflect the Company's estimate or projection of
future stock prices. Actual gains, if any, realized upon future exercise of
these options will depend on the actual performance of the common stock and
the continued employment of the named executive officer through the vesting
period of the option.
</FN>
</TABLE>
Aggregated Option Exercises in Last Fiscal Year
and FY-End Option Values
This table provides certain information regarding the exercise of stock
options by the named executive officers during fiscal 1999, and the number and
value of unexercised stock options at September 30, 1999. The "value of
unexercised stock options" is based on the difference between the option
exercise price and $15.75, the closing price per share of common stock on
September 30, 1999 multiplied by the number of shares underlying the option. As
of that date, no SARs were outstanding.
<TABLE>
<CAPTION>
Name Number of Unexercised Value of Unexercised In-the
- ---- Securities Underlying Money Options
Shares Value Options at FY-End (#) at FY-End ($)
Acquired on Realized --------------------------- --------------------------
Exercise (#) ($) Exercisable Unexercisable Exercisable Unexercisable
------------ --------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Sidney V. Corder 69,500 1,492,926 160,000 112,500 208,133 34,375
John J. Dillon 5,875 71,969 35,437 35,438 10,874 10,876
Timothy A. -- -- 6,250 18,750 -- --
Gregory
David O. Hicks -- -- 12,500 12,500 -- --
Randal J. Sage -- -- 96,982 52,328 133,964 44,656
Scott C. Benger 4,500 124,469 120,250 55,250 471,611 27,063
</TABLE>
7
<PAGE>
Option Repricing
The table below sets forth certain information concerning the repricing
of stock options held by any executive officer of the Company which occurred
December 11, 1998. Further explanation concerning these repricings is included
in the Report of the Compensation Committee below.
<TABLE>
<CAPTION>
Length of
Original
Option
Securities Market Price Term
Underlying of Stock at Exercise Price New Remaining
Options Time of at Time of Exercise at Date of
Name Date Repriced (#) Repricing ($) Repricing ($) Price ($) Repricing
---- ---- ------------ ------------- ------------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Sidney V. Corder 12/11/98 200,000 25.00 48.88 33.00 9 yrs, 2 mos
Scott C. Benger 12/11/98 90,000 25.00 48.88 33.00 9 yrs, 2 mos
John J. Dillon 12/11/98 60,000 25.00 48.88 33.00 9 yrs, 2 mos
Randal J. Sage 12/11/98 60,000 25.00 48.88 33.00 9 yrs, 2 mos
</TABLE>
Employment Contracts
On June 27, 1994 the Company entered into an employment agreement with
Mr. Corder, providing for a base salary, which salary is reviewed in October of
each year. The term of the employment agreement extends until June 26, 2000 and
is automatically extended for successive two-year periods thereafter. Mr.
Corder's current salary is $300,000. While he is employed by the Company
pursuant to his employment agreement Mr. Corder is entitled to participate in
the Company's Incentive Bonus Plan and Stock Option Plan and any and all other
plans, to the extent he meets eligibility requirements, maintained by the
Company for the benefit of the Company's executives or employees generally.
Upon termination of Mr. Corder's employment without cause, Mr. Corder
will continue to receive salary and benefits for 24 months, and receive a bonus
during such period equal to the amount of bonuses received by him during the 24
months prior to termination. During such period any stock options held by Mr.
Corder will continue to vest and he will have the right to exercise such options
that are or become exercisable during such period. If Mr. Corder resigns his
employment for "cause" (as defined in the employment agreement), he will
continue to receive salary and benefits for 36 months. During such period any
stock options held by Mr. Corder will continue to vest and he will have the
right to exercise such options that are or become exercisable during such
period. If Mr. Corder is terminated by the Company for "cause" (as defined in
the employment agreement) he will not be entitled to receive any termination pay
or benefits beyond the effective date of termination. If Mr. Corder terminates
his employment without "cause" the Company may accept his resignation or require
him to continue his employment at the same salary and benefits for a period not
to exceed six months. In the event of termination upon a change of control (as
defined in the employment agreement) the aggregate amount of severance paid
under the employment agreement or otherwise (but exclusive of any amount payable
under any incentive benefit plan upon a change of control) will not include any
amount that the Company is prohibited from deducting under Section 2806 of the
Internal Revenue Code or any successor provision. If Mr. Corder dies or becomes
disabled (as defined in the employment agreement) his salary will continue to be
paid to his designee for 12 months after his death or termination by reason of
disability. The Company agreed to provide Mr. Corder with a $250,000 life
insurance policy (plus $250,000 accidental death coverage) payable to his
designated beneficiaries.
8
<PAGE>
Under the employment agreement Mr. Corder has agreed that during the
term of the employment agreement he will not, directly or indirectly, engage in
any activities in conflict with the best interests of the Company. He has
further agreed not to be employed by or otherwise engage or be interested in any
other business, whether or not in competition with the Company, except he is
permitted to have an investment in certain non- competing businesses and to
provide consulting services to non-competing businesses, if expressly approved
by the Company. In addition, Mr. Corder has agreed that he will not at any time
disclose any confidential information of the Company that he obtains as a result
of his employment with the Company.
The Company is in the process of negotiating a renewal of Mr. Corder's
employment agreement and employment agreements with the other executive
officers.
Report of the Compensation Committee
The Compensation Committee follows established rationale and policies
for compensating the Company's executive officers. The following Report of the
Compensation Committee describes these policies and rationales with respect to
the compensation paid to such executive officers for the fiscal year ended
September 30, 1999.
Policy. The Compensation Committee's fundamental policy is to provide a
compensation program for executive officers that will (i) enable the Company to
attract and retain the services of highly-qualified individuals and (ii) offer
the Company's executive officers competitive compensation opportunities based
upon overall Company performance and their individual contribution to the
financial success of the Company. It is the Committee's objective to have a
substantial portion of each officer's compensation contingent upon the Company's
performance, as well as upon such officer's own level of performance.
Accordingly, each executive officer's compensation package is comprised of three
elements: (i) base salary, which is designed to be competitive with salary
levels of similar companies that compete with the Company for executive talent
and reflects individual performance; (ii) annual variable performance awards
payable in cash and tied to the Company's achievement of financial performance
goals and the executive's contribution; and (iii) long-term stock option awards,
which create common interests for the executive officers and the shareholders.
Base Salary. Individual salaries are determined based on individual
experience, performance and breadth of responsibility within the Company. The
Compensation Committee reviews these factors for each executive officer each
year. In addition, the Compensation Committee considers executive officers'
salaries for relative competitiveness within the Company's industry.
Bonuses. On September 26, 1991, the Compensation Committee adopted an
Incentive Bonus Plan for its executive officers. The Incentive Bonus Plan is
based on the year-to-year growth in net profit and on the return on equity. In
fiscal 1999, two executive officers were paid bonuses in an aggregate of
$100,000 under the plan.
Stock Option Plans. The Company has the Analytical Surveys, Inc. 1993
Non-Qualified Stock Option Plan and the Analytical Surveys, Inc. 1997 Incentive
Stock Option Plan, as amended and supplemented (the "Option Plans"). The Option
Plans are long-term incentive plans for employees and are intended to align
shareholder and employee interests by establishing a direct link between
long-term rewards and the value of the Company's stock. The Compensation
Committee believes that long-term stock incentives for executive officers and
employees are an important factor in retaining valued employees and in achieving
growth in share value. The options utilize vesting periods that encourage
employees to continue in the employ of the Company. Because the value of an
option bears a direct relationship to the Company's stock price, the
Compensation Committee believes that options motivate officers and employees to
manage the Company in a manner that will benefit all shareholders.
9
<PAGE>
The size of stock option grants is determined by a number of factors,
including comparable grants to executive officers and employees by other similar
companies, as well as the relative position and responsibilities of executive
officers and other employees with the Company, the individual performance of the
executive officer or employee over the previous fiscal year and the anticipated
contribution of the executive officer or employee to the attainment of the
Company's long-term strategic performance goals. The exercise price per share of
each stock option is equal to the closing market price of a share of the
Company's common stock on the date such option is granted. The Committee views
stock option grants as an important component of its long-term,
performance-based compensation philosophy.
CEO Compensation. The compensation of Sidney Corder, Chairman of the
Board, President and Chief Executive Officer consists of base salary, typically
an annual bonus and occasionally stock options. The Board of Directors
periodically reviews Mr. Corder's base salary and bonus and revises his
compensation based on the Board's overall evaluation of his performance toward
the achievement of the Company's financial, strategic and other goals, with
consideration given to chief executive officer compensation information at
similar companies. The Compensation Committee believes that the Company's
success is dependent in part upon the efforts of its Chief Executive Officer. In
fiscal 1999, Mr. Corder earned a base salary of $300,000 as recommended by the
Compensation Committee and approved by the Board of Directors. Application of
the Incentive Bonus Plan was deferred. No stock options were granted to Mr.
Corder in fiscal 1999.
Deductibility of Executive Compensation. The Compensation Committee is
responsible for addressing the issues raised by Internal Revenue Code Section
162(m) ("Section 162(m)"). This Section limits to $1 million the Company's
deduction for compensation paid to certain executive officers of the Company
which does not qualify as "performance-based." To qualify as performance based
under Section 162(m), compensation payments must be made pursuant to a plan that
is administered by a committee of outside directors and must be based on
achieving objective performance goals. In addition, the material terms of the
plan must be disclosed to and approved by shareholders, and the Compensation
Committee must certify that the performance goals were achieved before payments
can be awarded. The Company believes that all compensation paid to its executive
officers listed in the Summary Compensation Table in fiscal 1998 is fully
deductible and that compensation paid under the plans will continue to be
deductible. The Committee's present intention is to comply with the requirements
of Section 162(m) unless and until the Committee determines that compliance
would not be in the best interest of the Company and its shareholders.
Option Repricing. On December 11, 1998, upon the recommendation of the
Compensation Committee, the Board met to consider repricing of options granted
in fiscal 1998. The Board concluded that the price at which the options were
originally priced was exceptionally high due to unusually high market conditions
in February 1998, the time when the options were granted. The Board also
concluded that the grant had largely lost the incentive the outstanding options
were intended to create. The Board considered the market prices of the common
stock for the year and determined to re-price those grants to $33. The new
option price was approximately the average of ASI's stock price for the year and
was above the market price ($25) at the date of re-pricing.
By the Compensation Committee
Richard P. MacLeod, Chair
Willem H.J. Andersen
Robert H. Keeley
James T. Rothe
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<PAGE>
Performance Graph
This graph shows a five-year comparison of the cumulative total returns
for the Company's common stock, the index of the cumulative total return for the
Nasdaq Stock Market (U.S.) ("Total U.S.") and the index of the Nasdaq Computer
and Data Processing Services Stocks ("DP&S"). The graph assumes that $100 was
invested on October 1, 1993, and that all dividends, if any, were reinvested.
[Performance graph appears here]
The following data points were used in constructing the Performance
Graph:
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
The Company 100 207 455 947 962 652
Nasdaq DP&S 100 160 199 269 349 586
Nasdaq Total U.S. 100 138 164 225 229 372
Voting Securities and Principal Shareholders
The following table sets forth as of December 31, 1999, certain
information with respect to the ownership of the common stock of the Company by
(i) each person (or group of affiliated persons) known by the Company to be the
beneficial owner of more than 5% of the Company's outstanding common stock
(based on filings with the Securities and Exchange Commission), (ii) each
director of the Company, (iii) each of the Company's named
11
<PAGE>
executive officers and (iv) all executive officers and directors of the Company
as a group. Except as otherwise noted in the table, each person or group
identified possesses sole voting and investment power with respect to such
shares, subject to community property laws, where applicable, and the address of
such shareholder is c/o Analytical Surveys, Inc., 941 North Meridian Street,
Indianapolis, Indiana 46204.
<TABLE>
<CAPTION>
Name of Beneficial Owner Shares Percent
- ------------------------ ------ -------
Beneficially of Class
------------ --------
Owned
-----
<S> <C> <C>
Sol C. Miller 848,750(1) 12.2%
John A. Thorpe 383,489(2) 5.5%
Sidney V. Corder 218,400(3) 3.0%
Willem H. J. Andersen 41,550(4) *
Robert H. Keeley 29,250(5) *
Richard P. MacLeod 67,352(6) *
James T. Rothe 52,654(7) *
Scott C. Benger 145,450(8) 2.0%
John J. Dillon 50,437(9) *
Timothy A. Gregory 12,500(10) *
David O. Hicks 12,900(11) *
Randal J. Sage 111,982(12) 1.6%
All directors and executive officers as a 1,975,714 (13) 25.6%
group (13 persons)
- -----------
* Less than 1%
<FN>
(1) Includes 6,750 shares of common stock underlying options that are
exercisable within 60 days of December 31, 1999. Includes 37,000 shares
held by the SCM Family Limited Partnership of which Mr. Miller and his wife
are the sole general partners.
(2) Includes 43,125 shares of common stock underlying options that are
exercisable within 60 days of December 31, 1999. Includes 122,249 shares of
common stock held by the Thorpe Family Limited Partnership of which Mr.
Thorpe and his wife are the sole general partners and 52,000 shares of
common stock held by a charitable remainder trust of which Mr. Thorpe is a
trustee.
(3) Includes 210,000 shares of common stock underlying options that are
exercisable within 60 days of December 31, 1999.
(4) Includes 38,250 shares of common stock underlying options that are
exercisable within 60 days of December 31, 1999.
(5) Includes 24,750 shares of common stock underlying options that are
exercisable within 60 days of December 31, 1999 and 4,500 shares held by
Mr. Keeley's wife.
12
<PAGE>
(6) Includes 61,500 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
(7) Includes 50,404 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
(8) Includes 142,750 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
(9) Includes 50,437 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
(10) Includes 12,500 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
(11) Includes 12,500 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
(12) Includes 111,982 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
(13) Includes 764,948 shares of common stock underlying options which are
exercisable within 60 days of December 31, 1999.
</FN>
</TABLE>
Ratification of Selection of Independent Auditors
(Item 2 on Proxy Card)
Pursuant to the Bylaws of the Company, shareholders will be asked to
ratify the selection of KPMG LLP as independent auditors of the Company for the
year ending September 30, 2000. KPMG LLP has no relationship with the Company
except in its capacity as the Company's auditors.
A representative of KPMG LLP is expected to be present at the Annual
Meeting and will be available to respond to appropriate inquiries.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR
RATIFICATION OF THE APPOINTMENT OF KPMG LLP.
Compliance with Section 16(a) of the 1934 Securities Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and any persons who own more than 10
percent of the Company's common stock, to file with the Securities and Exchange
Commission ("SEC") reports of ownership and changes of ownership of the
Company's common stock.
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<PAGE>
To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company during fiscal 1999, all such filing
requirements were met.
Shareholder Proposals
ASI's 2001 Annual Meeting is expected to be held in February 2001. Any
shareholder who intends to submit a proposal for inclusion in the Company's
proxy materials for the 2001 Annual Meeting of Shareholders must submit a
proposal by September 16, 2000. Such proposals may be included in next year's
Proxy Statement if they comply with certain rules and regulations promulgated by
the SEC.
Shareholders who intend to present a proposal to be considered at the 2000
Annual Meeting of Shareholders without inclusion of such proposal in the
Company's proxy materials are required to provide notice of such proposal to the
Company not later than November 30, 2000.
All notices should be sent to the Secretary at the address on the cover of
this Proxy Statement.
Annual Report
THE ANNUAL REPORT FOR ANALYTICAL SURVEYS, INC., FOR THE YEAR ENDED
SEPTEMBER 30, 1999, IS MAILED WITH THIS PROXY STATEMENT. COPIES OF THE ANNUAL
REPORT AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FORM 10-K,
INCLUDING FINANCIAL STATEMENTS AND SCHEDULES THERETO MAY BE OBTAINED BY REQUEST
FROM VINCENT J. OTTO, SECRETARY, 941 NORTH MERIDIAN STREET, INDIANAPOLIS,
INDIANA 46204.
Other Matters
Management is not aware of any matters to come before the meeting which
will require the vote of shareholders other than those matters indicated in the
Notice of Shareholder Meeting and this Proxy Statement. However, if any other
matter calling for shareholder action should properly come before the meeting or
any adjournments thereof, those persons named as proxies in the enclosed Proxy
Form will vote thereon according to their best judgment.
By Order of the Board of Directors
January 14, 2000 /s/ Vincent J. Otto
--------------------------
Vincent J. Otto
Secretary/Treasurer
14
<PAGE>
FORM OF PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
Analytical Surveys, Inc.
941 North Meridian Street
Indianapolis, Indiana 46204
The undersigned appoints Sidney V. Corder and Vincent J. Otto and each of
them, with full power of substitution, the proxies of the undersigned to
vote all shares of common stock of Analytical Surveys, Inc., which the
undersigned is entitled to vote at the Annual Meeting of Shareholders of
the Corporation to be held at Antlers Adam's Mark Hotel, 4 South Cascade
Avenue, Colorado Springs, Colorado, on February 16, 2000, at 3:30 p.m.
Annual Meeting February 16, 2000
1 ELECTION OF DIRECTORS
|_| FOR all nominees listed below |_|WITHHOLD AUTHORITY to vote
(except as marked to the contrary below) for all nominees listed below
Willem H.J. Andersen Sidney V. Corder Robert H. Keeley
Richard P. MacLeod Sol C. Miller James T. Rothe
INSTRUCTION: To withhold authority for any individual nominee, strike a line
through or otherwise strike the nominee's name in the list above.
Please continue on reverse side
<PAGE>
2
PROPOSAL TO RATIFY THE SELECTION OF KPMG LLP AS THE COMPANY'S INDEPENDENT
AUDITORS FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 2000:
|_| FOR |_| AGAINST |_| ABSTAIN
3 IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1 and 2.
Dated ______________________, 2000
Signed ___________________________
Signed ___________________________
NOTE: Signature should agree with name on Stock Certificate as printed thereon.
Executors, administrators, trustees and other fiduciaries should so indicate
when signing.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
