<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] DEFINITIVE PROXY STATEMENT
[_] DEFINITIVE ADDITIONAL MATERIALS
[_] SOLICITING MATERIAL PURSUANT TO SECTION 240.14a-11(c) OR SECTION 240.14a-12
SYNTELLECT INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
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):
<PAGE> 2
(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:
NOTES:
<PAGE> 3
[LOGO OF SYNTELLECT APPEARS HERE]
20401 North 29th Avenue
Phoenix, Arizona 85027
NOTICE AND PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 1, 2000
To the Stockholders:
The 2000 Annual Meeting of Stockholders (the "Annual Meeting") of
Syntellect Inc., a Delaware corporation (the "Company"), will be held on
Thursday, June 1, 2000, at 10:30 a.m., Phoenix, Arizona time, at Syntellect
Corporate Headquarters, 20401 North 29th Avenue, Phoenix, Arizona 85027, for the
following purposes:
1. To elect two directors to the Board of Directors to serve for a
three-year term; and
2. To approve an amendment to the Company's 1995 Long-term Incentive Plan
to increase the number of shares of Syntellect common stock authorized
for issuance thereunder from 1,500,000 to 2,100,000; and
3. To Approve an amendment to the Company's Non-employee Director Stock
Plan; and
4. To ratify the appointment of KPMG LLP as independent auditors of the
Company for the fiscal year ending December 31, 2000; and
5. To transact such other business as may properly come before the Annual
Meeting.
Each outstanding share of the Company's common stock entitles the
holder of record at the close of business on April 3, 2000 to vote at the Annual
Meeting or any adjournment thereof. Shares can be voted at the Annual Meeting
only if the holder is present or represented by proxy. A copy of the Company's
1999 Annual Report to Stockholders, which includes certified financial
statements, is enclosed. Management cordially invites you to attend the Annual
Meeting.
By Order of the Board of Directors
/s/ Timothy P. Vatuone
Timothy P. Vatuone
Secretary
Phoenix, Arizona
April 24, 2000
IMPORTANT
STOCKHOLDERS ARE EARNESTLY REQUESTED TO SIGN, DATE, AND MAIL THE ENCLOSED PROXY.
A POSTAGE-PAID ENVELOPE IS PROVIDED FOR MAILING IN THE UNITED STATES.
<PAGE> 4
[LOGO OF SYNTELLECT APPEARS HERE]
20401 North 29th Avenue
Phoenix, Arizona 85027
PROXY STATEMENT
This Proxy Statement is furnished to the stockholders of Syntellect Inc.,
a Delaware corporation ("Syntellect" or the "Company"), in connection with the
solicitation of proxies on behalf of the Board of Directors of the Company for
use in voting at the Annual Meeting of Stockholders to be held on Thursday, June
1, 2000, at 10:30 a.m., Phoenix, Arizona time, at Syntellect Corporate
Headquarters, 20401 North 29th Avenue, Phoenix, Arizona 85027 (the "Annual
Meeting"), and at any adjournment or adjournments thereof. The proxy materials
were mailed on or about April 24, 2000, to stockholders of record at the close
of business on April 3, 2000 (the "Record Date"). The Company had 11,782,242
shares of common stock outstanding, par value $.01 per share ("Common Stock"),
as of the close of business on the Record Date. Only stockholders of record on
the Record Date will be entitled to vote at the Annual Meeting. The holders of a
majority of the voting power of the issued and outstanding Common Stock entitled
to vote, present in person or represented by proxy, shall constitute a quorum at
the Annual Meeting.
Each stockholder is entitled to one vote per share for the election of
directors as well as on all other matters that may be properly considered at the
Annual Meeting. If the accompanying proxy is signed and returned, the shares
represented thereby will be voted in accordance with any directions on the
proxy. A person giving the enclosed proxy has the power to revoke it at any time
before it is exercised by: (i) attending the Annual Meeting and voting in
person; (ii) duly executing and delivering a proxy bearing a later date; or
(iii) sending written notice of revocation to the Secretary of the Company at
its principal executive offices located 20401 North 29th Avenue, Phoenix,
Arizona 85027.
Votes cast by proxy or in person at the Annual Meeting will be tabulated
by the inspectors of election appointed for the Meeting and will determine
whether or not a quorum is present. The affirmative vote of a plurality of the
shares present in person or by proxy and entitled to vote is required to elect
directors. With respect to other matters submitted at the Annual Meeting, the
approval of any such matter would require a greater number of votes cast
favoring the matter than the number of votes cast opposing such matter. Shares
held by nominees for beneficial owners will be counted for purposes of
determining whether a quorum is present if the nominee has the discretion to
vote on at least one of the matters presented, even if the nominee may not
exercise discretionary voting power with respect to other matters and voting
instructions have not been received from the beneficial owner (a "broker non-
vote"). Abstentions with respect to a proposal are counted for purposes of
establishing a quorum. Abstentions will not be counted as votes for or against
the election of directors, but will have the effect of a vote against any other
matter. Broker non-votes will not be counted as votes for or against any matter
submitted to a vote of shareholders.
The Company will bear the cost of the solicitation of proxies, including
the charges and expenses of brokerage firms and others for forwarding
solicitation material to beneficial owners of the outstanding Common Stock of
the Company. In addition to the use of the mails, proxies may be solicited by
personal interview, telephone, or facsimile. The Company has retained Corporate
Investor Communications, Inc., at an estimated cost of $3,000, plus
reimbursement of expenses, to assist in soliciting proxies from brokers,
nominees, institutions and individuals. Arrangements will also be made with
custodians, nominees, and fiduciaries to solicit proxies, and the Company will
reimburse such custodians, nominees and fiduciaries for reasonable expenses
incurred in connection herewith.
As of the date of this Proxy Statement, the Company knows of no matter to
be brought before the Annual Meeting other than those referred to in the
accompanying Notice of Annual Meeting. If, however, any other matters properly
come before the Annual Meeting, it is intended that proxies in the accompanying
form will be voted thereon in accordance with the judgment of the persons voting
such proxies.
1
<PAGE> 5
PROPOSAL 1
ELECTION OF DIRECTORS
The number of directors of the Company is four divided into three classes.
Each director is elected for three years and the terms are staggered so that
only one class is elected by the stockholders annually. The present terms of
Messrs. Anthony V. Carollo and Michael D. Kaufman will expire at the Annual
Meeting. Messrs. Carollo and Kaufman have been nominated for re-election as
directors of the Company and, unless otherwise noted thereon, the shares
represented by the enclosed proxy will be voted for the election of Messrs.
Carollo and Kaufman as directors of the Company. If either Mr. Carollo or Mr.
Kaufman becomes unavailable for any reason, or if a vacancy should occur before
election (which events are not anticipated), the shares represented by the
enclosed proxy may be voted for such other person or persons as may be
determined by the holders of such proxy. The nominees receiving the highest
number of votes cast at the Annual Meeting will be elected and will serve as
directors for three years or until their successors are duly elected and
qualified.
INFORMATION CONCERNING DIRECTORS AND NOMINEES
Information concerning the names, ages, terms, positions with the
Company, and business experience of the Company's current directors is set forth
below:
<TABLE>
<CAPTION>
Name Age
- ---- ---
<S> <C>
Anthony V. Carollo, Jr.......................... 58
Michael R. Bruce (1) (2)........................ 52
William P. Conlin (1) (2)....................... 66
Michael D. Kaufman (1).......................... 59
</TABLE>
<TABLE>
<CAPTION>
Term
Position Expires
- -------- -------
<S> <C>
Director, Chairman of the Board of Directors, 2000
and Chief Executive Officer
Director 2001
Director 2002
Director 2000
</TABLE>
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
Anthony V. Carollo, Jr. became Syntellect's Chairman and Chief
Executive Officer (CEO) on November 4, 1999 after serving as Chairman and
interim CEO since May 14, 1999. He has served as a director since August 1998.
Prior to February 15, 2000, Mr. Carollo was a member of the Audit Committee. Mr.
Carollo was the President of Xantel Corporation from April 1998 to November
1999. Previously, Mr. Carollo was the President and Chief Operating Officer of
Fujitsu Business Communication Systems and a former Vice President and General
Manager of ROLM Corporation. He has also held numerous financial positions, at
ROLM, Arcata Communications and Arthur Andersen & Company. Mr. Carollo currently
serves as a director of Marshall & Ilsley Trust Company of Arizona and
Spectralink Corporation. Mr. Carollo holds a Bachelor's of Science degree from
the University of Santa Clara and a Master of Business Administration degree
from UCLA.
Michael R. Bruce has served as a director of the Company since December
1997. Mr. Bruce serves as Managing Director and Chief Investment Officer of
American Asset Management in New York, and has been a General Partner of
Catalyst Associates since 1995. Prior to joining American Asset Management in
1993, Mr. Bruce assisted in the formation of Johnston Bruce Asset Management
where he served as Managing Director and Portfolio Manager for four years. He
was also a general partner of Adler & Shaykin, an investment banking firm, from
1983 to 1989. Mr. Bruce holds a Bachelor's Degree from Hamilton College. In
addition, he earned a CFA designation in 1976 and is a member of the New York
Society of Security Analysts and the Financial Analysts Federation.
William P. Conlin has served as a director of the Company since
February 1995. Mr. Conlin serves as a private consultant to several high-tech
companies in the Southern California area, including Odetics, Inc., Airborne
Systems, Inc., and Facilities Management, Inc. Mr. Conlin served as President
and Chief Executive Officer of CalComp, Inc., an Anaheim, California computer
graphics and distribution company, from 1983 to 1993. From 1960 to 1983, Mr.
Conlin served in a variety of management positions at Burroughs Corp. (now
Unisys). Mr. Conlin currently serves as director and is on the Compensation
Committee for SDRC, a leading supplier of mechanical
2
<PAGE> 6
design automation software. Mr. Conlin is on the advisory boards of the Graduate
School of Management and the School of Engineering at the University of
California, Irvine.
Michael D. Kaufman has served as a director of the Company since
November 1998. Mr. Kaufman has served as a managing general partner of MK Global
Ventures in California since 1987. Prior to that Mr. Kaufman was a general
partner of Oak Investment Partners where he was involved in the formation of
numerous technology companies. He is currently a director of and serves on the
Compensation Committee of Davox Corporation. He also serves on the Board of
Asante Technologies, Inc., Disc Inc., Human Pheromone Sciences, Inc., and
HyperMedia Communications, Inc. Mr. Kaufman holds a Bachelor's of Science degree
in mechanical engineering and a Master of Science degree in industrial
management and finance from the Polytechnic University New York.
3
<PAGE> 7
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the number and percentage of outstanding
shares of Common Stock beneficially owned by (a) each director of the Company,
(b) the Chief Executive Officer and each of the four other most highly
compensated officers of the Company (collectively, the "Named Executive
Officers"), (c) each person known by the Company to beneficially own more than
5% of such stock; and (d) all directors and Named Executive Officers of the
Company as a group.
<TABLE>
<CAPTION>
Shares Beneficially Percent
Name and Address of Beneficial Owner Owned (1) Owned
- ------------------------------------ --------- -----
<S> <C> <C>
Michael D. Kaufman (2) ................... 1,263,600 10.5%
Dimensional Fund Advisors Inc. (3) ....... 952,100 7.9%
J. Lawrence Bradner (4) .................. 799,654 6.6%
T. Rowe Price Associates, Inc (5) ........ 700,000 5.8%
Nixon Group (6) .......................... 698,220 5.8%
Noro-Moseley Partners II., L. P. (7) ..... 625,000 5.2%
W. Scott Coleman (8) ..................... 255,814 2.1%
Anthony V. Carollo (9) ................... 98,200 *
Michael R. Bruce(10) ..................... 45,720 *
Michael L. Talley (11) ................... 34,700 *
William P. Conlin (12) ................... 21,120 *
Keith A. Pekkala (13) .................... 15,200 *
Steven M. Pizzagoni ...................... 10,000 *
All Directors and Named Executive Officers
as a group (9 persons) (14) ............. 1,744,354 14.5%
</TABLE>
* Represents less than 1% of the outstanding Common Stock.
(1) This information regarding security ownership of the Common Stock is as
of March 20, 2000 except for the security ownership information regarding
Dimensional Fund Advisors Inc., which is derived from a Schedule 13G filed
by Dimensional Fund Advisors Inc. with the Commission on February 11, 2000;
T. Rowe Price Associates, Inc., which is derived from a Schedule 13G filed
by T. Rowe Price Associates, Inc. with the Commission on February 14, 2000;
and the Nixon Group, which is derived from a Schedule 13G filed by the
Nixon Group with the Commission on March 6, 2000. The percent owned
calculations are based on the number of shares of Common Stock outstanding
on March 20, 2000, or within sixty days thereafter.
(2) The total number of shares of common stock shown for Mr. Kaufman includes
1,070,000 shares held by MK GVD Fund. Mr. Kaufman is a general partner of
MK GVD Management, the general partner of MK GVD Fund. Mr. Kaufman
disclaims beneficial ownership of these shares; however, Mr. Kaufman shares
the power to vote and control the disposition of such shares and,
therefore, may be deemed to be a beneficial owner thereof. The total
includes 10,000 shares held by Mr. Kaufman's spouse and 3,600 shares
subject to unexercised options which were exercisable on March 20, 2000 or
within 60 days thereafter. Mr. Kaufman's address is c/o MK GVD Fund, 2471
E. Bayshore Road, Suite 520, Palo Alto, California 94303.
(3) Dimensional Fund Advisors Inc. ("Dimensional") is a California-based
registered investment advisor. Dimensional is deemed to have beneficial
ownership of 952,100 shares of Common Stock, all of which are held in
portfolios for which Dimensional serves as investment manager. Dimensional
disclaims beneficial ownership of all such shares of Common Stock. The
address of Dimensional Fund Advisors Inc. is 1299 Ocean Avenue, 11th Floor,
Santa Monica, California 90401.
(4) The total number of shares of common stock shown for Mr. Bradner includes
282,852 shares subject to unexercised options which were exercisable on
March 20, 2000, or within 60 days thereafter. Mr. Bradner's address is 210
Hepplewhite Drive, Alpharetta, Georgia 30022.
4
<PAGE> 8
(5) T. Rowe Price Associates, Inc. is a Maryland-based registered investment
advisor. The shares of Common Stock shown for T. Rowe Price Associates,
Inc. are owned by various individuals and institutional investors, for
which T. Rowe Price Associates, Inc. serves as investment adviser with
power to direct investments and/or sole power to vote the securities. For
purposes of the reporting requirements of the Securities Exchange Act of
1934, T. Rowe Price Associates, Inc. is deemed to be a beneficial owner of
such securities; however, T. Rowe Price Associates, Inc. expressly
disclaims the beneficial ownership of such securities. The address of T.
Rowe Price Associates, Inc. is 100 E. Pratt Street, Baltimore, Maryland
21202.
(6) The total number of shares of Common Stock shown for the Nixon Group is
distributed among the following individuals and entities, who collectively
comprise the Nixon Group: 1,020 shares owned by Geoffrey Nixon, whose
address is 11 West 42nd Street, 19th Floor, New York, NY 10036; 258,200
shares owned by Mission Partners, L.P., a Delaware limited partnership
("Mission"), whose address is 11 West 42nd Street, 19th Floor, New York, NY
10036; 83,500 shares owned by Liberty Nominees Limited, a New Zealand
company ("Liberty"), whose address is P. O. Box 10-246, Wellington, New
Zealand; 57,300 shares owned by Horizon Offshore, Ltd., a Cayman Islands
investments corporation, whose address is c/o International Management
Services, Limited, Harbour Centre, North Church Street, P. O. Box 616,
George Town, Grand Caymen, Caymen Islands, B.W.I.; 38,000 shares owned by
U.S. Equity Investment L.P., a Delaware limited partnership ("Equity"),
whose address is 1001 North Highway 1, Suite 800, Jupiter, Florida 33477;
250,200 shares owned by Mayfair Capital Fund, L.P., a Delaware limited
partnership ("Mayfair"), whose address is 11 West 42nd Street, 19th Floor,
New York, NY 10036; 0 shares owned by MCM Associates, Ltd., a Delaware
corporation ("MCM"), whose address is 11 West 42nd Street, 19th Floor, New
York, NY 10036; 10,000 shares owned by MCM Profit Sharing Plan
-DLJSC-Custodian FBO Geoffrey Nixon, Trustee, a New York entity ("PSP"),
whose address is 11 West 42nd Street, 19th Floor, New York, NY 10036.
Each member of the Nixon Group has sole voting and dispositive power over
the shares attributed to such entity, except as noted hereafter. MCM is
the sole general partner of Mission, and as such has voting and
dispositive power over the shares owned by Mission. Geoffrey Nixon is the
sole officer, director and shareholder of Mission. MCM has sole voting
power and investment discretion over investment accounts established by
Liberty and Equity. MCM is the sole investment adviser of Horizon and
exercises voting control and dispositive power over the shares owned by
Horizon. The voting and disposition of the shares owned by Mayfair is
controlled by MCM Capital Management, LLC, a Delaware limited liability
company, and the sole general partner of Mayfair. Geoffrey Nixon is the
sole management and principal member of MCM Capital Management, LLC are
subject to the voting control PSP is a New York profit sharing plan for
the benefit of Geoffrey Nixon, who is the sole Trustee and Beneficiary of
PSP; accordingly, Geoffrey Nixon has sole voting and dispositive power
over the shares owned by PSP. This information was obtained from the
Schedule 13G filed by the Nixon Group with the Securities and Exchange
Commission on March 13, 2000.
(7) Noro-Moseley Partners II, L.P. is an Atlanta-based venture capital firm.
The address of Noro-Moseley Partners II, L.P. is c/o Noro-Moseley Partners,
4200 Northside Parkway N.W., Building 9, Atlanta, Georgia 30327.
(8) The total number of shares of common stock shown for Mr. Coleman includes
196,000 shares subject to unexercised options which were exercisable on
March 20, 2000, or within 60 days thereafter.
(9) The total number of shares of common stock shown for Mr. Carollo includes
28,200 shares subject to unexercised options which were exercisable on
March 20, 2000, or within 60 days thereafter.
(10) The total number of shares of common stock shown for Mr. Bruce includes
6,720 shares subject to unexercised options which were exercisable on March
20, 2000, or within 60 days thereafter.
(11) The total number of shares of common stock shown for Mr. Talley includes
22,800 shares subject to unexercised options which were exercisable on
March 20,2000, or within 60 days thereafter
(12) The total number of shares of common stock shown for Mr. Conlin includes
21,120 shares subject to unexercised options which were exercisable on
March 20, 2000, or within 60 days thereafter.
(13) The total number of shares of common stock shown for Mr. Pekkala includes
1,200 shares subject to unexercised options which were exercisable on March
20, 2000, or within 60 days thereafter.
5
<PAGE> 9
(14) The total number of shares of common stock shown for all directors and
Named Executive Officers as a group includes an aggregate of 279,640 shares
subject to unexercised options which were exercisable on March 20, 2000, or
within sixty days thereafter.
BOARD OF DIRECTORS' MEETINGS, COMPENSATION, AND COMMITTEES
During the fiscal year ended December 31, 1999, the Board of Directors of
the Company met on four occasions. Each of the Company's directors attended all
of the meetings of the Board of Directors and of the meetings held by committees
of the Board of Directors on which he served.
Directors who are not officers or employees of the Company are compensated
$1,500 for attendance at regular Board of Directors meetings, $200 for
participation in telephonic Board of Directors meetings, and $200 for attendance
at, or participation by telephone in, meetings of committees of the Board of
Directors of which they are members. In addition, non-employee directors also
receive an annual retainer of $5,000 for their service with the Company.
Non-employee directors are reimbursed for reasonable out-of-pocket expenses
incurred in connection with their attendance at each meeting of the Board of
Directors and committee meetings of the Board of Directors. Pursuant to the
Company's Non-employee Director Stock Plan, non-employee directors are eligible
to receive (i) a one-time grant of options to purchase 10,000 shares of Common
Stock on the third business day after the non-employee director is first elected
or appointed to the Board of Directors and (ii) an annual grant of options to
purchase 5,000 shares of Common Stock on each June 1 thereafter. A non-employee
director must be a member of the Board of Directors on the relevant June 1 in
order to receive the annual grant of options for that year.
The Board of Directors maintains a standing Compensation Committee and a
standing Audit Committee. The Compensation Committee, which met once during
1999, reviews all aspects of compensation of executive officers of the Company
and approves or makes recommendations on such matters to the full Board of
Directors. The Audit Committee, which met once during 1999, is primarily
concerned with the effectiveness of the audits of the Company by its internal
audit staff and by the Company's independent auditors. Its responsibilities
include recommending the selection of independent auditors, reviewing the
organization and scope of the Company's internal system of audit and controls,
and evaluating the Company's financial reporting activities and the accounting
standards and principles followed. The Company does not maintain a standing
nominating committee or other committee performing similar functions.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's officers, directors and persons who own
more than 10% of the Company's Common Stock, to file reports of beneficial
ownership and changes in such ownership with the Securities and Exchange
Commission ("SEC"). Based solely upon a review of the copies of such forms
furnished to the Company, or written representations from certain reporting
persons that no Form 5 was required for such person, the Company believes that,
during 1999, all officers, directors, and persons who own more than 10% of the
Company's Common Stock complied with the applicable Section 16(a) filing
requirements; however, the reports required to be filed by Messrs. Talley and
Pizzagoni were filed late. With respect to Mr. Talley, 5 reports were filed
late, covering a total of 6 transactions. With respect to Mr. Pizzagoni, 2
reports were filed late, covering a total of 3 transactions.
6
<PAGE> 10
EXECUTIVE COMPENSATION
The table below sets forth information concerning the annual and long-term
compensation for services rendered in all capacities to the Company during the
fiscal years ended December 31, 1999, 1998, and 1997, by the Named Executive
Officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation
------------------- ------------
Other Securities
Annual Underlying All Other
Salary Bonus Compensation Options Compensation
Name and Principal Position Year ($) ($) ($) (1) (#) (2) ($) (3)
--------------------------- ---- --- --- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Anthony V. Carollo Jr. (4) 1999 26,461 0 0 350,000 46
Chairman of the Board and Chief 1998 0 0 0 10,000 0
Executive Officer 1997 0 0 0 0 0
W. Scott Coleman (5) 1999 210,000 0 0 0 3,618
President, Call Center Software 1998 185,000 37,000(6) 0 120,000 3,821
and Services 1997 178,192 0 0 25,000 3,714
Michael L. Talley (7) 1999 157,500 32,000 0 30,000 2,226
Executive Vice President 1998 81,827 30,000 0 30,000 1,822
Professional Services 1997 0 0 0 0 0
Keith A. Pekkala (8) 1999 64,730 0 0 10,000 1,476
Vice President and Controller 1998 0 0 0 0 0
1997 0 0 0 0 0
Steven M. Pizzagoni (9) 1999 34,134 0 0 50,000 41
Executive Vice President of Sales 1998 0 0 0 0 0
1997 0 0 0 0 0
J. Lawrence Bradner (10) 1999 309,943(11) 0 0 0 5,728
Former Chairman of the Board, Chief 1998 252,090 60,500(6) 0 0 9,655
Executive Officer, President and 1997 252,000 0 0 27,500 6,437
Chief Operating Officer
Neal L. Miller (12) 1999 180,000 0 0 0 3,594
Former President, Syntellect 1998 170,000 72,500(13) 0 100,000 3,766
Interactive Services 1997 145,000 0 0 10,000 3,237
Steve G. Nussrallah (14) 1999 52,500(15) 0 0 0 0
Former President and Chief 1998 234,750(16) 0 0 0 0
Operating Officer 1997 210,000 0 0 25,000 4,756
Peter W. Pamplin (17) 1999 130,000 0 0 30,000 66
Former Vice President, Chief 1998 113,301 14,000(6) 0 5,000 331
Financial Officer, Secretary and 1997 55,417 0 0 12,500 165
Treasurer
</TABLE>
7
<PAGE> 11
(1) Other annual compensation for the periods presented was less than 10% of
the respective executive officer's total annual salary and bonus.
(2) The amounts shown in this column represent outstanding stock options
granted pursuant to Syntellect's Long-term Incentive Plan and Restated
Stock Option Plan.
(3) The amounts shown in this column for 1999 include the following:
<TABLE>
<CAPTION>
Long-term Disability Company Contribution to
and or Life Insurance 401(k) Profit Sharing
Name Premiums ($) Plan ($) Total ($)
---- ------------ -------- ---------
<S> <C> <C> <C>
Mr. Carollo................ 46 0 46
Mr. Coleman................ 306 3,312 3,618
Mr. Talley................. 255 1,971 2,226
Mr. Pekkala................ 50 1,426 1,476
Mr. Pizzagoni.............. 41 0 41
Mr. Bradner................ 3,501 2,227 5,728
Mr. Miller................. 282 3,312 3,594
Mr. Pamplin................ 66 0 66
</TABLE>
(4) Mr. Carollo was elected interim Chief Executive Officer and Chairman of the
Board on May 12, 1999 and became Chief Executive Officer and Chairman of
the Board on November 4, 1999.
(5) Mr. Coleman joined the Company and became its Vice President of Product
Development in February 1993. He served as Chief Executive Officer from
October 1995 to March 1996, and served as Senior Vice President and General
Manager, Call Center Systems, from March 1996 to April 1997. He was
promoted to President, Call Center Systems, in May 1997.
(6) The 1998 bonus amounts shown for Messrs. Bradner, Coleman, and Pamplin
represent bonuses earned in 1998 that were not paid until 1999.
(7) Mr. Talley joined the Company as Executive Vice President Professional
Services on June 15, 1998.
(8) Mr. Pekkala joined the Compay as Vice President and Controller on March 29,
1999.
(9) Mr. Pizzagoni joined the Company as Executive Vice President of Sales on
October 29, 1999.
(10) Mr. Bradner joined the Company and became its Chairman and Chief Executive
Officer effective March 14, 1996. Effective May 14, 1999, Mr. Bradner
resigned as an officer and director of the Company. See "Employment
Agreements."
(11) Mr. Bradner's compensation in 1999 included $136,818 in regular earnings
and $173,125 in severance pay. See "Employment Agreements."
(12) Mr. Miller joined the Company and became its Vice President, Chief
Financial Officer, Secretary and Treasurer in December 1995. As of March
31, 1998, Mr. Miller assumed the additional role of President of Syntellect
Interactive Services, Inc. Effective March 31, 2000, Mr. Miller resigned as
an officer of the Company.
(13) The amount shown for Mr. Miller's bonus includes a bonus for $42,500 which
was earned in 1998 and not paid until 1999.
(14) Mr. Nussrallah joined the Company and became its President and Chief
Operating Officer effective March 14, 1996. Effective March 31, 1998, Mr.
Nussrallah resigned as an officer of the Company. See "Employment
Agreements."
(15) Mr. Nussrallah's compensation in 1999 was all severance pay.
(16) Mr. Nussrallah's compensation in 1998 included $86,000 in regular earnings
and $148,750 in severance pay.
(17) Mr. Pamplin joined the Company and became its Vice President and Controller
on June 2, 1997. Mr. Pamplin was promoted to Vice President, Chief
Financial Officer, Secretary and Treasurer on August 13, 1998. Effective
December 31, 1999, Mr. Pamplin resigned as an officer of the Company. See
"Employment Agreements."
8
<PAGE> 12
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning the grants of stock
options to the Named Executive Officers pursuant to the Company's Long-term
Incentive Plan during the fiscal year ended December 31, 1999. No Stock
Appreciation Rights ("SARs") were granted during 1999.
<TABLE>
<CAPTION>
Individual Grants (1)
-------------------------------------------------------------
Potential Realizable
Number of Percent of Value at Assumed Annual
Securities Total Options Exercise Rates of Stock Price
Underlying Granted to Price Per Appreciation for Option
Options Employees in Share Expiration Term (2)
Name Granted (#)(3) Fiscal Year ($/Share) Date 5% ($) 10% ($)
- ---- -------------- ----------- --------- ---- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Anthony V. Carollo Jr. 100,000 13.5% 1.44 5/14/09 90,404 229,100
250,000 33.8% 1.81 11/4/09 284,968 722,165
------- ----- ------- -------
350,000 47.3% 375,372 951,265
W. Scott Coleman 0 0 0
Michael L. Talley 30,000 4.1% 2.50 2/18/09 47,167 119,531
Keith A. Pekkala 5,000 0.7% 1.44 5/14/09 4,520 11,455
5,000 0.7% 1.47 7/28/09 4,618 11,704
----- ---- ----- ------
10,000 1.4% 9,138 23,159
Steven M. Pizzagoni 50,000 6.8% 1.81 11/4/09 56,994 144,432
J. Lawrence Bradner 0
Neal L. Miller 0 0 0
Steve G. Nussrallah 0 0 0
Peter W. Pamplin 30,000 4.1% 2.50 2/18/09 47,167 119,531
</TABLE>
(1) All options were granted at the fair market value (the closing price of the
Common Stock on The Nasdaq Stock Market, as reported in The Wall Street
Journal) on the date of grant. The exercise price and tax withholding
obligations related to exercise may be paid by delivery of already owned
shares or by offset of the underlying shares, subject to certain
conditions.
(2) Gains are reported net of the option exercise price, but before taxes
associated with exercise. These amounts represent certain assumed rates of
appreciation. Actual gains, if any, on stock option exercises are dependent
on the future performance of the Common Stock and overall stock market
conditions, as well as the option holder's continued employment with the
Company throughout the vesting period. The amounts reflected in this table
will not necessarily be achieved.
(3) All options granted in 1999 are exercisable commencing one year from the
date of grant, with 24% of the shares of Common Stock subject to the
options vesting at that time and an additional 2% vesting monthly
thereafter until the options are fully vested.
9
<PAGE> 13
FISCAL YEAR END OPTION VALUES
The following table sets forth information concerning the fiscal year end
value of unexercised options held by the Named Executive Officers. No Named
Executive Officer exercised options in 1999.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised Options at In-the-Money Options
Fiscal Year End (#) at Fiscal Year End ($) (1)
------------------------------------ ------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Anthony V. Carollo Jr................ 3,200 356,800 4,000 461,625
W. Scott Coleman..................... 172,500 87,500 61,250 95,000
Michael L. Talley.................... 10,800 49,200 11,475 35,400
Keith A. Pekkala..................... 0 10,000 0 15,469
Steven M. Pizzagoni.................. 0 50,000 0 59,375
J. Lawrence Bradner.................. 282,852 0 602,475 0
Neal L. Miller....................... 65,200 69,800 43,750 81,250
Steve G. Nussrallah.................. 282,852 0 602,475 0
Peter W. Pamplin..................... 9,700 0 2,750 0
</TABLE>
(1) Options are considered to be "in-the-money" if the fair market value of the
underlying securities exceeds the exercise price of the options on the
specified date. The amounts shown in these columns represent the difference
between the closing price of the Common Stock on December 31, 1999 ($3.00),
and the exercise price of the options. In those instances where the
exercise price of the options exceeds the fair market value, no value has
been reported.
BOARD OF DIRECTORS COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Company's executive compensation program was administered in 1999 by a
two-member Compensation Committee of the Board of Directors (the "Committee").
The members of the Committee, who are not employees of the Company, have
furnished the following report on executive compensation:
Executive Compensation Policies
Overview. The Company compensates its executives through a combination of
short-term and long-term compensation programs. The principal components of
executive compensation are base salary, an annual bonus program, or, in the case
of marketing and sales personnel, sales commissions, and stock-based
compensation incentives. The Committee believes that this balanced approach to
compensation helps the Company attract and retain senior executives and rewards
executives for their collective and individual contribution to the leadership
and the short-term and long-term growth and profitability of the Company.
Base Salary. The foundation of the Company's executive compensation
package is base salary. Each executive receives a base salary which, when
aggregated with their maximum bonus amount or potential sales commissions, is
intended to be commensurate with his or her responsibilities and level of
performance and competitive with similarly situated executives in the
telecommunications industry. Among the elements that the Committee considers in
setting an executive's base salary for the year are: (i) the executive's
position relative to other executives in the Company, (ii) any promotions
achieved or changes in responsibility, (iii) the achievement of performance
objectives set by the Committee, and (iv) compensation information provided by
independent surveys and outside consultants relating to the compensation of
similarly situated executives in the telecommunications industry.
Annual Bonus Program. The second aspect of the Company's executive
compensation package is the annual bonus. Over the past several years, the
Company has established an annual bonus program for its executive officers at
the beginning of each fiscal year. Under this program, the Committee sets a
target bonus amount for each executive, which is tied to achievement of certain
financial performance objectives that relate directly to the Company's operating
plan for the year. This program is also approved by the Board of Directors. The
amount of the annual bonus varies with the position and the role of the
executive within the Company. In addition, special bonuses may be awarded to an
executive for any reason that the Board of Directors or the Committee deems
appropriate.
10
<PAGE> 14
At the end of 1999, the Committee reviewed the performance of the Company's
executives in relation to the bonus program. The Company did not achieve the
financial performance targets established at the beginning of the year. As a
result, only two bonuses were paid.
Stock-Based Compensation Incentives. The third aspect of the Company's
executive compensation package is stock-based compensation incentives or stock
options. The Committee believes that executives with an equity stake in the
Company will have interests that are more closely aligned with the interests of
the Company's stockholders and that this will encourage them to remain with the
Company. Toward this end, the Committee grants options to Company executives
from time to time. Historically, all options granted have had exercise prices
set at the fair market value of the Company's Common Stock on the date of grant,
as determined by the closing price of the Common Stock on The Nasdaq Stock
Market.
In selecting recipients and the number of options granted in 1999, the
Committee looked to several criteria, including (i) options granted to
executives at other technology companies, (ii) options granted to other
executives within the Company, (iii) the individual executive's specific role
and performance with the Company, and (iv) the Company's overall performance.
Compensation Committee Interlocks and Insider Participation
The Committee is comprised of outside directors, none of whom have any
interlocking relationships with the Company.
Compliance with Section 162(m) of the Internal Revenue Code
Section 162(m) of the Internal Revenue Code, as amended, generally limits
to $1 million the deduction that can be claimed by any publicly-held corporation
for compensation paid to any "covered employee" in any taxable year beginning
after December 31, 1993. The term "covered employee" for this purpose is defined
generally as the Chief Executive Officer and the four highest-paid employees of
the corporation.
Performance-based compensation is outside the scope of the $1 million
limitation and, hence, generally can be deducted by a publicly-held corporation
without regard to amount; provided that, among other requirements, such
compensation is approved by stockholders. The Committee currently does not
anticipate that any executive will exceed the $1 million limit. It is the policy
of the Company to comply with Section 162(m), and it will continue to do so to
the extent such compliance is consistent with the best interests of the
Company's stockholders. The Committee will continue to review the impact of this
tax code section and make appropriate recommendations to stockholders in the
future.
Employment Agreements
On November 1, 1998, the Company entered into an employment agreement with
Mr. Bradner, whereby he would serve as the Chairman and Chief Executive Officer
of the Company. The employment agreement provided Mr. Bradner with an annual
salary of $252,000 beginning on November 1, 1998 and ending on December 31,
1998. The employment agreement also provided that Mr. Bradner receive an annual
salary of $277,000 beginning on January 1, 1999 and ending December 31, 1999. In
the event of termination without cause, Mr. Bradner is to receive twelve (12)
months salary plus health benefits. Effective May 14, 1999, Mr. Bradner resigned
as an officer and director of the Company. His resignation was deemed to be a
termination without cause, accordingly, Mr. Bradner's salary of $277,000 per
year and health benefits will continue through May 14, 2000. In addition, the
agreement provides that Mr. Bradner's option to purchase 282,852 shares of
Common Stock at a purchase price of $0.87 per share not be affected by his
resignation as an officer of the Company.
On August 24, 1998, the Company entered into an employment agreement with
Mr. Miller, whereby he would serve as the President of Syntellect Interactive
Services. The employment agreement provided Mr. Miller with an annual salary of
$170,000 beginning on August 24, 1998 and ending on December 31, 1998. The
employment agreement also provided that Mr. Miller would receive an annual
salary of $180,000 beginning on January 1, 1999 and ending December 31, 1999. In
the event of termination without cause, Mr. Miller would have received six (6)
11
<PAGE> 15
months salary plus health benefits. The agreement terminated on December 31,
1999. Mr. Miller resigned as an officer of the Company on March 31, 2000.
On September 19, 1998, the Company entered into an employment agreement
with Mr. Coleman, whereby he would serve as the President of Call Center
Systems. The employment agreement provided Mr. Coleman with an annual salary of
$185,000 beginning on September 19, 1998 and ending December 31, 1998. The
employment agreement also provided that Mr. Coleman would receive an annual
salary of $210,000 beginning on January 1, 1999 and ending on December 31, 1999.
The agreement terminated December 31, 1999, and Mr. Coleman continues as an
at-will employee.
On November 1, 1998, the Company entered into an employment agreement with
Mr. Pamplin, whereby he would serve as the Chief Financial Officer. The
employment agreement provided Mr. Pamplin with an annual salary of $120,000
beginning on November 1, 1998 and ending December 31, 1998. The employment
agreement also provided that Mr. Pamplin would receive an annual salary of
$130,000 beginning on January 1, 1999 and ending on December 31, 1999. Mr.
Pamplin resigned as an officer of the Company on December 31, 1999. In
accordance with the agreement, Mr. Pamplin will receive health benefits and a
continuation of his annual salary of $130,000 through June 30, 2000.
Effective March 31, 1998, Mr. Nussrallah resigned as an officer of the
Company and elected not to stand for re-election as a director of the Company.
The Company and Mr. Nussrallah entered into a Separation Agreement dated
February 20, 1998 which provided for the continuation of Mr. Nussrallah's annual
salary of $210,000 and medical insurance coverage through March 31, 1999. In
addition, the Separation Agreement provides that Mr. Nussrallah's option to
purchase 282,852 shares of Common Stock at a purchase price of $0.87 per share
not be affected by his resignation as an officer of the Company.
The Company has no employment agreements or change-in-control arrangements
with any other executive officers.
This report is made by William P. Conlin, and Michael R. Bruce, the members
of the Company's Compensation Committee during fiscal 1999.
COMPENSATION COMMITTEE
William P. Conlin
Michael R. Bruce
BOARD OF DIRECTORS AUDIT COMMITTEE REPORT
The Audit Committee has reviewed and discussed the audited financial
statements with the Company's management, and has discussed with the independent
auditors the matters required to be discussed by SAS 61, as in effect on the
date the audit was completed.
The Audit Committee has received the written disclosures and the letter
from the independent accountants required by Independence Standards Board
Standard No. 1 as in effect on the date the audit was completed, and has
discussed with the independent accountant the independent accountant's
independence.
Based on the review and discussions referenced above, the Audit Committee
recommended to the Company's Board of Directors that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the last
fiscal year for filing with the Securities Exchange Commission. The audited
financial statements have been included in the Company's Annual Report on Form
10-K.
As of March 20, 2000, the members of the Audit Committee are Michael R.
Bruce, William P. Conlin and Michael D. Kaufman. Each member of the Audit
Committee is an independent director within the meaning of Rule 4200(a)(15) of
the National Association of Securities Dealers' listing standards.
12
<PAGE> 16
The Company has not adopted a written charter for the Audit Committee. The
Company has requested that its counsel prepare and submit to the Board of
Directors for review and approval, a written charter for the Audit Committee.
AUDIT COMMITTEE
Michael R. Bruce
William P. Conlin
Michael D. Kaufman
13
<PAGE> 17
STOCK PRICE PERFORMANCE GRAPH
The graph below compares the cumulative total return on the Company's
Common Stock with The Nasdaq Stock Market index (U.S. companies) and an index
consisting of Nasdaq Telecommunications Stocks (U.S. and foreign) for the period
from December 31, 1994 to December 31, 1999. The comparison assumes that $100
was invested on December 31, 1994, in the Company's Common Stock and in each of
the comparison indices, and assumes reinvestment of dividends.
<TABLE>
<CAPTION>
12/31/94 12/30/95 12/29/96 12/31/97 12/31/98 12/31/99
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Syntellect Inc $100 $49 $ 60 $26 $ 36 $ 43
NASDAQ Stock Market (U.S. Companies) $100 $141 $174 $213 $300 $556
NASDAQ Telecommunications Stocks $100 $131 $134 $195 $324 $572
</TABLE>
14
<PAGE> 18
PROPOSAL 2
APPROVAL OF AN AMENDMENT TO THE COMPANY'S 1995 LONG TERM INCENTIVE PLAN TO
INCREASE THE NUMBER OF SHARES OF THE COMPANY'S COMMON STOCK AUTHORIZED FOR
ISSUANCE THEREUNDER FROM 1,500,000 TO 2,100,000 SHARES
The Shareholders are being asked to approve an amendment to the Syntellect
Inc. Long Term Incentive Plan (the "Plan"), which increases the number of shares
of Common Stock authorized for issuance thereunder from 1,500,000 to 2,100,000
shares. As of March 20, 2000, 21,344 shares remained available for issuance
under the Plan. The full text of the Plan is incorporated by reference from
Exhibit 10.4 to the Company's 1996 Annual Report on Form 10-K.
The Plan permits the issuance of incentive stock options, non-qualified
stock options, stock appreciation rights, performance shares, restricted stock,
dividend equivalents and other stock-based awards. Incentive and non-qualified
stock options may be granted at a price not less than the fair market value of
the Common Stock at the date of grant, generally become exercisable over a 50
month period commencing on the date of grant, and expire in ten years. The Plan
terminates in February 2005.
The Board of Directors believes that the Plan is a key component of the
Company's compensation package, and that the grant of options strengthens the
personal link between the Company's interests and those of its employees. The
Board of Directors believes the availability of stock options affords the
Company the ability to attract, retain and motivate its employees, whose
judgment and special effort are required for the Company to achieve success.
The affirmative vote of the holders of a majority of the outstanding
shares of Common Stock present at the Annual Meeting in person or by proxy is
required for approval of the Plan amendment.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE AMENDMENT TO THE LONG
TERM INCENTIVE PLAN AND RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR APPROVAL OF
THE AMENDMENT.
PROPOSAL 3
APPROVAL OF AN AMENDMENT TO THE COMPANY'S NONEMPLOYEE DIRECTOR STOCK PLAN
The Shareholders are being asked to approve an amendment to the Syntellect
Inc. Non-employee Director Stock Plan (the "Director Plan"), which increases
from 2,000 to 5,000, the number of shares of Common Stock to be issued to
granted annually to the Company's directors. The full text of the Director Plan
is incorporated herein by reference to Exhibit B to the Company's Proxy
Statement for the 1995 Annual Meeting of Stockholders.
The Director Plan provides for each non-employee director to receive two
types of options grants to purchase the Company's Common Stock: a one-time grant
to purchase 10,000 shares of the Company's Common Stock on the third business
day after the non-employee director is first elected or appointed to the Board
of Directors, and an annual grant to purchase 2,000 shares of the Company's
Common Stock on each June 1 during such directors term. A non-employee director
must be a member of the Board of Directors on the relevant June 1 to receive the
annual option to purchase. The amendment would increase the annual option grant
from 2,000 shares of Common Stock to 5,000 shares of Common Stock. The exercise
price of options granted under the Director Plan must be the fair market value
of the Company's Common Stock on the date of grant, and such options generally
expire ten years from the date of grant.
The Board of Directors believes that the Director Plan promotes the
success and enhances the value of the Company by creating the ability to attract
and retain the services of experienced and knowledgeable individuals as
directors of the Company. The Director Plan also provides directors with an
incentive to work in the best interests of the Company and its shareholders.
15
<PAGE> 19
The affirmative vote of the holders of a majority of the outstanding
shares of Common Stock present at the Annual Meeting in person or by proxy is
required for approval of the Director Plan amendment.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE AMENDMENT TO THE
DIRECTOR PLAN AND RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR APPROVAL OF THE
AMENDMENT.
PROPOSAL 4
RATIFICATION OF INDEPENDENT AUDITORS
The Company is asking the shareholders to ratify the selection of KPMG LLP
as the Company's independent accountants for the fiscal year ending December 31,
2000.
The affirmative vote of the holders of a majority of the outstanding
shares of Common Stock present at the Annual Meeting in person or by proxy is
required to ratify the selection of KPMG LLP.
In the event the shareholders fail to ratify the appointment, the Board of
Directors will reconsider its selection. Even if the selection is ratified, the
Board of Directors, in its discretion, may direct the appointment of a different
independent accounting firm at any time during the year if the Board of
Directors feels that such a change would be in the best interests of the Company
and its stockholders.
KPMG LLP has audited the Company's financial statements annually since
1990. Its representatives will be present at the Annual Meeting, will have the
opportunity to make a statement if they desire to do so, and will be available
to respond to appropriate questions.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE RETENTION OF KPMG LLP
AND RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR APPROVAL OF THE RATIFICATION.
STOCKHOLDER PROPOSALS
Stockholder proposals may be submitted for inclusion in the Company's 2001
proxy material after the 2000 Annual Meeting. Proposals must be in writing, and
sent via registered, certified, or express mail to: Secretary, Syntellect Inc.,
20401 North 29th Avenue, Phoenix, Arizona 85027. Facsimile, E-mail or other
forms of electronic submissions will not be accepted.
The Company's bylaws provide that a stockholder proposal may be acted upon
at an annual meeting of stockholders only if the stockholder gives notice to the
Company of such proposal in conformity with the requirements of the bylaws (not
less than 90 nor more than 120 days prior to the annual meeting). The person
presiding at the meeting, in addition to making any other determinations that
may be appropriate to the conduct of the meeting, shall determine whether such
notice has been duly given and shall direct that proposals not be considered if
such notice has not been given.
INCORPORATION BY REFERENCE
The Company hereby incorporates by reference into this Proxy Statement,
the following information contained in its Annual Report on Form 10-K, a copy of
which accompanies this Proxy Statement: Market for the Registrant's Common
Equity and Related Stockholder Matters, Selected Financial Data, Management's
Discussion and Analysis of Financial Condition and Results of Operations,
Quantitative and Qualitative Disclosures About Market Risk, Financial Statements
and Supplementary Data, and Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
16
<PAGE> 20
OTHER MATTERS
The Board of Directors does not intend to present at the Annual Meeting
any matters other than those described herein and does not presently know of any
matters that will be presented by other parties. As of the date of this Proxy
Statement, the Company knows of no matters to be brought before the Annual
Meeting other than those referred to in the accompanying notice of annual
meeting. If, however, any other matters properly come before the meeting, it is
intended that proxies in the accompanying form will be voted thereon in
accordance with the judgment of the persons voting such proxies.
SYNTELLECT INC.
/s/ Timothy P. Vatuone
Timothy P. Vatuone
Secretary
April 24, 2000
17
<PAGE> 21
PROXY
SYNTELLECT INC.
2000 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Anthony V. Carollo and Timothy P. Vatuone, or
any one of them acting in the absence of the other with full powers of
substitution, the true and lawful attorneys and proxies for the undersigned and
to vote, as designated below, all shares of Common Stock of SYNTELLECT, INC.,
which the undersigned is entitled to vote at the Annual Meeting of Stockholders
(the "Meeting") to be held on Thursday, June 1, 2000, at 10:30 a.m., Phoenix,
Arizona time at Syntellect Corporate Headquarters located at 20401 North 29th
Avenue, Phoenix, Arizona 85027 and at any and all adjournments thereof, and to
vote all shares of Common Stock which the undersigned would be entitled to vote,
if then and there personally present, upon the matter described in the
accompanying Notice and Proxy Statement for the Annual Meeting of Stockholders,
receipt of which is hereby acknowledged and upon any other business that may
properly come before the Annual Meeting or any adjournment thereof.
THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY DIRECTIONS ARE
INDICATED, WILL BE VOTED FOR PROPOSAL ONE AND AS SAID PROXIES DEEM ADVISABLE ON
SUCH OTHER MATTERS AS MAY COME BEFORE THE MEETING.
(TO BE SIGNED ON THE REVERSE SIDE)
- --------------------------------------------------------------------------------
[UP ARROW GRAPHIC] FOLD AND DETACH HERE [UP ARROW GRAPHIC]
<PAGE> 22
Please mark
your votes as [X]
indicated in
this example.
<TABLE>
<CAPTION>
VOTE FOR WITHHOLD
all nominees listed all nominees listed
<S> <C> <C>
[ ] [ ]
1. RE-ELECTION OF DIRECTORS:
Nominees: Anthony V. Carollo and Michael D. Kaufman
Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name in the space below.
- ------------------------------------------------------------------------------
<CAPTION>
FOR AGAINST ABSTAIN
RATIFICATION RATIFICATION
<S> <C> <C> <C>
2. Ratification of amendment to the Company's Long-term Incentive Plan [ ] [ ] [ ]
3. Ratification of amendment to the Company's Non-employee Director Stock Plan [ ] [ ] [ ]
4. Ratification of appointment of KPMG LLP as independent auditors of the [ ] [ ] [ ]
Company for the fiscal year ending December 31, 2000:
</TABLE>
Signature(s)__________________________________________ Date____________________
NOTE: Please sign as name appears hereon. Joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian, please give a
title as such.
- -------------------------------------------------------------------------------
[UP ARROW GRAPHIC] FOLD AND DETACH HERE [UP ARROW GRAPHIC]
