SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] 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 Rule 14a-11(c) or Rule 14a-12
THE TRACKER CORPORATION OF AMERICA
----------------------------------
(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)(1) and
0-11.
1) Title of each class of securities to which transaction applies:
_________________________________________________________________
2) Aggregate number of securities to which transaction applies:
_________________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
_________________________________________________________________
4) Proposed maximum aggregate value of transaction:
_________________________________________________________________
<PAGE>
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:____________________________________________________
2
<PAGE>
THE TRACKER CORPORATION OF AMERICA
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS
OCTOBER 20, 2000
TO THE STOCKHOLDERS OF THE TRACKER CORPORATION OF AMERICA:
Notice is hereby given that the Annual Meeting of Stockholders of The
Tracker Corporation of America will be held at 2:00 p.m. (EDT) on Friday,
October 20, 2000, at the Comfort Inn at 2361 Austin Parkway, Flint, Michigan
48507 (telephone number: 810-232-4222), for the following purposes:
1. To elect one director to serve on the Board of Directors of the
Company for a term of three years.
2. To ratify the election of J. L. Stephen Co., P.C. as the independent
auditors of the Company for the fiscal year ending March 31, 2001.
3. To transact such other business as may properly come before the
meeting.
The Board of Directors has fixed the close of business on September 5, 2000
as the record date for the determination of stockholders entitled to receive
notice of and vote at the meeting.
We encourage you to take part in the affairs of your Company either in
person or by executing and returning the enclosed proxy.
By Order of the Board of Directors,
Bruce I. Lewis
Chief Executive Officer
Dated: September 20, 2000
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASE MARK, DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. IF YOU
LATER DESIRE TO REVOKE YOUR PROXY, YOU MAY DO SO AT ANY TIME BEFORE IT IS
EXERCISED.
<PAGE>
THE TRACKER CORPORATION OF AMERICA
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 20, 2000
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of The Tracker Corporation of America for use
at the Annual Meeting of Stockholders of the Company to be held at 2:00 p.m.,
local time, on Friday, October 20, 2000, at the Comfort Inn at 2361 Austin
Parkway, Flint, Michigan 48507 (telephone number: 810-232-4222), and at any
adjournment thereof. A stockholder giving the enclosed proxy may revoke it at
any time before the vote is cast at the annual meeting by delivering to a
Tracker officer either a written notice terminating the proxy's authority or a
proxy bearing a later date, or by appearing in person and voting at the meeting.
Shares of our common stock, $.001 par value, represented by a proxy will be
voted in the manner directed by a stockholder. If no direction is made, the
proxy will be voted for the election of the nominees for director named in this
Proxy Statement and for the other proposals set forth in this Proxy Statement.
This Proxy Statement and the accompanying form of proxy are being sent or given
to stockholders beginning on or about September 20, 2000, along with our Annual
Report to Stockholders for the year ended March 31, 2000.
Only stockholders of record at the close of business on September 15, 2000
are entitled to receive notice of and vote at the meeting or at any adjournment
thereof. As of September 15, 2000, there were 56,653,451 shares of our Common
Stock outstanding. Each share is entitled to one vote. Cumulative voting is
not permitted. Shares voted as abstentions on any matter (or a "withhold vote
for" as to a director) will be counted as shares that are present and entitled
to vote for purposes of determining the presence of a quorum at the meeting and
as unvoted, although present and entitled to vote, for purposes of determining
the approval of each matter as to which the stockholder has abstained. If a
broker submits a proxy that indicates the broker does not have discretionary
authority as to certain shares to vote on one or more matters, those shares will
be counted as shares that are present and entitled to vote for purposes of
determining the presence of a quorum at the meeting, but will not be considered
as present and entitled to vote with respect to such matters.
The Board of Directors knows of no matters other than those that are
described in this Proxy Statement that may be brought before the meeting.
However, if any other matters are properly brought before the meeting, persons
named in the enclosed proxy or their substitutes will vote in accordance with
their best judgment on such matters.
Tracker will pay all expenses in connection with the solicitation of
proxies. In addition to solicitation by mail, officers, directors and regular
employees of Tracker, who will receive no extra compensation for their services,
may solicit proxies by telephone, facsimile or personal calls. Our principal
executive offices are located at 1120 Finch Avenue West, Suite 303, North York,
Ontario M3J 3H8 Canada.
<PAGE>
ELECTION OF DIRECTORS
(PROPOSAL #1)
Our Bylaws provide that our directors shall be divided into three classes,
as nearly equal in number as reasonably possible. Vacancies and newly created
directorships resulting from an increase in the number of directors may be
filled by the vote of a majority of the directors then in office. The directors
so chosen will hold office until the next election of the class for which such
directors shall have been chosen.
Except for elections to fill vacancies created by the resignations of
directors not otherwise filled by the vote of a majority of the directors then
in office, directors elected at each annual meeting of stockholders will be of
the same class as the directors whose terms expire at such annual meeting of
stockholders, and shall be elected to hold office for a term expiring at the
third succeeding annual meeting of stockholders or until their successors are
elected and shall qualify.
Bruce I. Lewis, a current a director and Chairman of the Board of
Directors of Tracker, and Carl J. Corcoran, a current director, have been
nominated for reelection to the Board of Directors for a three-year term that
will expire at the annual meeting of stockholders in 2003. The person named as
proxy in the enclosed form of proxy intends to vote the proxies received by us
for the reelection of Mr. Lewis and Mr. Corcoran, unless otherwise directed.
Mr. Lewis and Mr. Corcoran have indicated a willingness to serve. If, however,
Mr. Lewis and Mr. Corcoran are not candidates at the meeting, which is not
presently anticipated, the proxy named in the enclosed form of proxy may vote
for a substitute nominee in his discretion.
THE AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE SHARES OF COMMON
STOCK REPRESENTED AT THE 2000 ANNUAL MEETING IS REQUIRED FOR THE REELECTION OF
MR. LEWIS AND MR. CORCORAN. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR MR.
LEWIS AND MR. CORCORAN.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The following table sets forth certain information regarding the beneficial
ownership of the common stock as of September 15, 2000 by:
- Each person known to us to own beneficially more than 5% of our total
voting stock;
- The CEO and the other executive officers named in the summary compensation
table;
- Each of our directors; and
- All of our directors and officers as a group.
Except as otherwise indicated below, to our knowledge all persons listed
below have sole voting and investment power with respect to their shares of
common stock, except to the extent that authority is shared by spouses under
applicable law. The common stock is our only outstanding class of equity
securities. As of September 15, 2000, there were approximately 365 record
holders of common stock. Percentage of ownership is based upon 56,653,451
issued and outstanding shares of common stock beneficially owned on September
2
<PAGE>
15, 2000, including currently exercisable warrants to purchase 1,250,000 shares
of common stock, currently exercisable options to purchase 40,000 shares of
common stock, currently exercisable options to purchase 2,488,578 shares of
common stock, currently exercisable options to purchase 200,000 shares reserved
under an option issued to Toda Corporation Limited for financial consulting
services, and 22,044,855 shares of common stock to be issued upon conversion of
the bridge financing notes and exercise of the repricing warrants issued in
August 1999 at $0.20 per share.
<TABLE>
<CAPTION>
Total Shares Owned
Beneficial Owner and Address As of September 15, 2000 Percentage
--------------------------------------------- ----------------------- -----------
<S> <C> <C>
Bruce I. Lewis, Chief Executive Officer 2,694,2891 3.26%
1120 Finch Avenue West, Suite 303
North York, Ontario, Canada M3J 3H7
Jay S. Stulberg, Chief Financial Officer 1,494,2892 1.81%
1120 Finch Avenue West, Suite 303
North York, Ontario, Canada M3J 3H7
H. Joseph Greenberg, M.D., Director 3,3333 <0.01%
1120 Finch Avenue West, Suite 303
North York, Ontario, Canada M3J 3H7
David G. R. Butler, Director 3,3333 <0.01%
1120 Finch Avenue West, Suite 303
North York, Ontario, Canada M3J 3H7
Carl J. Corcoran, Director 3,3333 <0.01%
1120 Finch Avenue West, Suite 303
North York, Ontario, Canada M3J 3H7
Executive Officers and Directors as a group, 4,198,5783 5.08%
Including those named above (five persons)
<FN>
(1) Number of shares includes the option to purchase 1,244,289 shares of common
stock. Furthermore, Mr. Lewis has pledged 600,000 shares of common stock
and the option to purchase an additional 1,244,289 shares of common stock
as security to the bridge financing notes.
(2) Number of shares includes the option to purchase 1,244,289 shares of common
stock. Furthermore, Mr. Stulberg has pledged 250,000 shares of common
stock and the option to purchase an additional 1,244,289 shares of common
stock as security to the bridge financing notes.
(3) Number of shares includes the currently exercisable option to purchase
3,333 shares of common stock.
</TABLE>
Upon registration of the common stock pursuant to the conversion of
the bridge financing notes and attached repricing warrants we issued in August
1999, SovCap Equity Partners, Ltd. will likely become a greater than 5%
shareholder in our company. SovCap Equity Partners, Ltd. address is Cumberland
House, #27 Cumberland Street, P.O. Box CB-13016, Nassau, New Providence, Bahamas
and is directed by Barry Herman, its President. Assuming we convert these notes
into common stock at a conversion price of $0.20 per share, after conversion of
the notes and exercise of the repricing warrants, SovCap Equity Partners, Ltd.
would own approximately 9,549,854 shares of our common stock. At that point,
SovCap Equity Partners, Ltd. would be an 11.55% shareholder. Under this
scenario, our current management would beneficially own less than 5.00% of the
issued and outstanding common stock. Should this occur, SovCap Equity Partners,
Ltd. may be in a position to effect a material change in our management.
Furthermore, if we decide to call the remaining warrants, SovCap Equity
Partners, Ltd. could be an even greater security owner if it decides to exercise
them.
3
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS
Information regarding our Board of Directors, including Bruce I. Lewis
and Carl J. Corcoran, is set forth below:
<TABLE>
<CAPTION>
NAME AGE POSITION
----------------------- --- ---------------------------------------------------------------
<S> <C> <C>
Bruce I. Lewis* 60 Chief Executive Officer and Chairman of the Board of Directors
Jay S. Stulberg 50 President, Chief Operating Officer, Chief Financial Officer and
Director
Dr. H. Joseph Greenberg 77 Director
Carl J. Corcoran* 73 Director
David G.R. Butler 64 Director
<FN>
_______________________
*Nominee.
</TABLE>
BRUCE I. LEWIS has been the Chairman of the Board of Directors (for a
term expiring at this 2000 annual meeting of Stockholders) and our Chief
Executive Officer since June 30, 1994, and President of the Company from August
12, 1995 to December 22, 1998. He is nominated to serve as a director for a
term expiring at the 2003 annual meeting of Stockholders. For the period from
1980 through May 1990, Mr. Lewis was President and a Director of Albert Berg
Limited and its subsidiaries. Albert Berg was petitioned into bankruptcy by its
creditors in May 1990. From June 1988 to August 1990, he served as the Chief
Executive Officer of Cape Breton Chemical Corporation, a start-up PVC flexible
stretch wrap manufacturer. From May 1990 through May 1993, Mr. Lewis was also a
consultant to various companies in the areas of management and acquisition
financing. From May 1993 until its dissolution in February 1998, Mr. Lewis
served as the Chief Executive Officer and Chairman of the Board of Directors of
Tracker Canada. From November 1997 to December 22, 1998, Mr. Lewis served as
interim Chief Financial Officer of The Company.
JAY S. STULBERG has been our President, Chief Operating Officer and
Chief Financial Officer and a Director since December 22, 1998 for the term
expiring at the 2001 annual meeting of stockholders. Since February 1998, Mr.
Stulberg has been the sole shareholder, director and officer of Global Tracker
Corp. Since approximately 1984, Mr. Stulberg has served on the Board of
Directors of two privately held family holding companies. From 1992 to 1994,
Mr. Stulberg served as the Controller (i.e., the Senior Financial Officer) of
Enershare Technology Corp. From 1994 to mid-1996, Mr. Stulberg served as the
Group Controller of Algorithmics, Inc.
H. JOSEPH GREENBERG has been a Director since December 22, 1998 for a
present term expiring at the 2002 annual meeting of Stockholders. Dr. Greenberg
has engaged in the practice of medicine since his graduation from medical school
in 1952. He has been a director of Genevest, Inc. since 1993.
4
<PAGE>
CARL J. CORCORAN has been a Director since December 22, 1998 for a
term expiring at this 2000 annual meeting of stockholders. He is nominated to
serve as a director for a term expiring at the 2003 annual meeting of
Stockholders. Mr. Corcoran was employed by IBM Corporation in various
capacities from 1951 to 1988, including General Manager of Operations of IBM
Japan and President of IBM Canada. Mr. Corcoran is currently an officer and
director of several family-held businesses, including Corcair Farms, Ltd.,
CorProperties, Inc., Cor Source Water Corporation, Corcorvest Corporation and
CJC Bottling, Ltd. He is also a director of the Accessible Software
Corporation, a publicly traded corporation, and A.A.B. Building Systems, Inc., a
private company.
DAVID G. R. BUTLER has been a Director since December 22, 1998 for a
term expiring at the 2001 annual meeting of stockholders. Mr. Butler is the
chief executive officer and sole shareholder of Holiday Breaks International,
Inc., which offers stay-free hotel accommodations to companies as sales and
marketing incentives; MF Incentives, Inc., which offers travel coupons as sales
incentives for manufacturers' products; and Newfound Communications, Inc., which
offers premium incentive promotions. From 1978 until its sale in 1994, Mr.
Butler was the sole shareholder and chief executive officer of Marshall Fenn
Limited, a public relations and advertising agency. At Marshall Fenn, Mr.
Butler established several affiliated enterprises referred to as the Marshall
Fenn Group of Companies, including Holiday Breaks International, Inc., MF
Incentives, Inc., and Newfound Communications, Inc.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
TRANSACTIONS WITH MANAGEMENT
We have entered into employment agreements containing severance
arrangements with certain executive officers. These agreements provide for
compensation payments under certain circumstances to each officer through the
remainder of the term of the agreements. Our certificate of incorporation and
bylaws provide for indemnification of all directors and officers. In addition,
each director nominee, when elected, will enter into separate indemnification
agreements with us.
We have agreed with certain state regulatory authorities that so long as
our securities are registered in such states, we will not make loans to our
officers, directors, employees, or principal stockholders. This does not
include loans made in the ordinary course of business, such as travel advances,
expense account advances, relocation advances, or reasonable salary advances.
Furthermore, all future transactions with our executive officers,
directors, employees, 5% stockholders and affiliates will be subject to the
approval of a majority of the independent, disinterested members of the board of
directors. Such future transactions must be for bona fide business purposes on
terms that are no less favorable to us than those that could be negotiated with
unaffiliated parties.
GLOBAL TRACKER
In February 1998, Global Tracker acquired substantially all of the
assets of Tracker Canada in a bankruptcy proceeding. Jay S. Stulberg, our Chief
Financial Officer and Director, is the sole shareholder, officer and Director of
Global Tracker. Following the bankruptcy proceeding, Global Tracker made the
assets formerly owned by Tracker Canada available to us in order to permit us to
carry on Tracker Canada's business. Since February 1998, Global Tracker has
expended approximately $13,000 to support our business operations. Furthermore,
Mr. Stulberg has personally loaned Global Tracker approximately $120,000 (USD)
in operating capital. Under a license agreement with Global Tracker, we will
pay Global Tracker a 12% gross royalty on our sales.
5
<PAGE>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
We do not have a class of equity securities registered pursuant to
Section 12 of the Exchange Act. Accordingly, our directors, officers and 10%
beneficial owners are not required to file reports pursuant to Section 16(a) of
the Exchange Act.
COMMITTEES OF THE BOARD OF DIRECTORS
The board of directors currently has four committees. The entire
Board is responsible for the size and composition of the Board and for
recommending nominees to serve on the Board.
The Executive Committee comprises of Messrs. Lewis and Stulberg and is
responsible for:
- supervising our day-to-day operations
- strategic planning
- recruiting outside directors.
The Audit Committee is comprised of Messrs. Butler and Stulberg and is
responsible for:
- reviewing and recommending the engagement of our independent
auditors
- consulting with the independent auditors on the adequacy of
internal controls
- reviewing the auditors' reports on our financial statements
The Board of Directors has not adopted a written charter for the audit committee
The Ethics Committee is comprised of Mr. Corcoran and Dr. Greenberg and
is responsible for:
- reviewing corporate policies and procedures
- insuring the dissemination of material information to all key
managers
The Compensation Committee is comprised of Messrs. Butler and Corcoran and
is responsible for:
- determining the compensation of our senior officers
- reviewing recommendations by management as to the compensation
of other officers and key personnel
- reviewing management's succession program
- administer the stock incentive plan
During the fiscal year ended March 31, 2000, the Board of Directors met one
time. Messrs. Lewis, Stulberg, Corcoran and Greenberg attended this meeting of
the Board of Directors. During the fiscal year ended March 31, 2000, each of
the aforementioned committees also met one time.
6
<PAGE>
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
COMPENSATION OF NAMED EXECUTIVE OFFICERS
The following table provides certain information concerning the
compensation earned by our Chief Executive Officer and other then-executive
officers who received compensation in excess of $100,000 for services rendered
in all capacities to us for the most recent three fiscal years.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long-Term Compensation
-----------------------------------
Annual Compensation Awards Payouts
------------------------------- -----------------------------------
Restricted Securities
Stock Under-Lying LTIP All Other
Name and then- Fiscal Salary Bonus Other Award(s) Options/SARs Payouts Compensation
Principal Position Year ($) ($) ($)(1) ($) (#) ($) ($)
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
BRUCE I. LEWIS, CEO 2000 30,000 10,000 145,000 500,000
1999 0 10,000 175,000 2,488,578
1998 45,750 10,000 131,250 0
JAY S. STULBERG,
President, COO & CFO 2000 36,250 10,000 88,750 600,000
1999 40,000 10,000 85,000 2,488,578
<FN>
(1) Automobile Allowance
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
(INDIVIDUAL GRANTS)
Percent Of
Number of Total
Securities Options/SARs
Underlying Granted To
Option/SARs Employees In Exercise Price of Base Price
Name Granted (#) Fiscal Year ($$/Sh) Expiration Date
(a) (b) (c) (d) (e)
---------------- ------------ ------------- ----------------------------- ----------------
<S> <C> <C> <C> <C>
Bruce I. Lewis 600,000(1) 27.3% .118 2009
Jay S. Stulberg 600,000(1) 27.3% .118 2009
<FN>
(1) Non-qualified stock option granted for a ten-year term exercisable sequentially in
three annual installments beginning January 2001, and fully vesting beginning January
2003.
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FY-END OPTION/SAR VALUES
Number of Securities Underlying Value of Unexercised In-The-
Unexercised Options/SARs At Money Options/SARs At FY-
Shares Acquired FY-End (#) Exercisable/ End ($) Exercisable/
Name On Exercise (#) Value Realized Unexercisable Unexercisable
(a) (b) (c) (d) (e)
---------------- ---------------- --------------- -------------------------------- ------------------------------
<S> <C> <C> <C> <C>
Bruce I. Lewis 0 N/A 1,244,289/3,044,289 $ 437,368/$622,468
Jay S. Stulberg 0 N/A 1,244,289/1,844,289 $ 437,368/$622,468
</TABLE>
7
<PAGE>
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL
BRUCE LEWIS
On December 18, 1998, we entered into an employment agreement with Mr.
Lewis, pursuant to which Mr. Lewis serves as our Chief Executive Officer. The
agreement provides for an annual base salary of $175,000, with increases of
$37,500 each year based upon certain performance criteria beginning April 1,
2000, a maximum automobile allowance of $10,000 and eligibility for
discretionary bonuses.
The initial term for Mr. Lewis' agreement is three years with one-year
renewal terms thereafter, and provides for the payment of a relocation allowance
equal to the lesser of the actual relocation expenses or $25,000 per each
occurrence. The agreement provides that Mr. Lewis is entitled to participate in
any stock option, stock purchase, annual bonus, pension, profit sharing, life
insurance and medical benefit plans and such other fringe benefits that may be
applicable to our senior executive employees.
If Mr. Lewis' employment is terminated for cause or if he terminates for
any reason, he will be entitled to compensation through the date of termination.
If, prior to a change of control, employment is terminated due to his death or
disability, by us other than for cause or by him for good reason, he is entitled
to receive all compensation through the date of termination. He also receives
the continuation of base salary for the greater of one year or the remainder of
the term of the agreement. In addition, we will maintain for 12 months, or
through the date he obtains alternative employment, whichever is earlier, his
participation in our employee benefit plans in which he was eligible to
participate immediately before termination to the extent permissible under such
plans. He will also have the right to exercise all vested stock options
outstanding at the termination date in accordance with the plans governing those
options. We will use our best efforts to remove the restrictions from any
restricted stock held by him at termination. If his employment is terminated
after a change of control, either by the executive for good reason or by us
without cause, he will receive all the benefits he would have received for such
a termination prior to a change of control. All unvested stock options held by
him shall become immediately fully vested. Payments made in conjunction with a
change of control are limited to an amount that will not result in either a loss
of our income tax deduction under Internal Revenue Code.
JAY STULBERG
On December 18, 1998, we entered into an employment agreement with Mr.
Stulberg, pursuant to which Mr. Stulberg serves as our President, Chief
Operating Officer and Chief Financial Officer and Secretary. The agreement
provides for an annual base salary of $125,000, with increases of $37,500 each
year based upon certain performance criteria beginning April 1, 2000, a maximum
automobile allowance of $10,000 and eligibility for discretionary bonuses.
The initial term of Mr. Stulberg's agreement is three years with one-year
renewal terms thereafter, and provides for the payment of a relocation allowance
equal to the lesser of the actual relocation expenses or $25,000 per each
occurrence. The agreement provides that Mr. Stulberg is entitled to participate
in any stock option, stock purchase, annual bonus, pension, profit sharing, life
insurance and medical benefit plans and such other fringe benefits that may be
applicable to our senior executive employees.
8
<PAGE>
If Mr. Stulberg's employment is terminated for cause or if he terminates
for any reason, he will be entitled to compensation through the date of
termination. If, prior to a change of control, employment is terminated due to
his death or disability, by us other than for cause or by him for good reason,
he is entitled to receive all compensation through the date of termination. He
also receives the continuation of base salary for the greater of one year or the
remainder of the term of the agreement. In addition, we will maintain for 12
months, or through the date he obtains alternative employment, whichever is
earlier, his participation in our employee benefit plans in which he was
eligible to participate immediately before termination to the extent permissible
under such plans. He will also have the right to exercise all vested stock
options outstanding at the termination date in accordance with the plans
governing those options. We will use our best efforts to remove the
restrictions from any restricted stock held by him at termination. If his
employment is terminated after a change of control, either by the executive for
good reason or by us without cause, he will receive all the benefits he would
have received for such a termination prior to a change of control. All unvested
stock options held by him shall become immediately fully vested. Payments made
in conjunction with a change of control are limited to an amount that will not
result in either a loss of our income tax deduction under Internal Revenue Code.
COMPENSATION OF DIRECTORS
Non-employee directors are paid $500 for attendance at each meeting of the
board of directors or a committee meeting. Non-employee directors also receive
an annual retainer of $10,000. In addition, non-employee directors are eligible
to receive options to purchase shares of our common stock.
Under our 1999 Director Option Plan, each non-employee director is
automatically granted an option to purchase 5,000 shares of common stock upon
election. If the non-employee director is elected Chairman of the Board, the
director is granted an option to purchase 10,000 shares of common stock. On
every anniversary of initial election or appointment, each eligible director is
automatically granted a nonqualified option to purchase an additional 5,000
shares of common stock (10,000 shares if Chairman of the Board). The plan
provides that options granted to non-employee directors have a maximum term of
ten years and are exercisable ratably in annual installments over three years.
All options granted to non-employee directors vest immediately upon a change of
control. The exercise price of options granted pursuant to such automatic
grants is reduced to a price 25% below the average trading price of our common
stock for the 30 days immediately prior to the grant date. On December 22, 1999,
we granted options to purchase 5,000 shares of our common stock at an exercise
price of $0.098 per share to each Joseph Greenberg, David Butler and Carl
Corcoran.
9
<PAGE>
RATIFICATION OF INDEPENDENT AUDITORS
(PROPOSAL #2)
On August 27, 1999, our Board of Directors decided to retain the
certified public accounting firm of J. L. Stephan Co., P.C. to replace Hirsch
Silberstein & Subelsky, P.C. as our independent accountants. Hirsch Silberstein
& Subelsky, P.C. has discontinued its audit practice concerning compliance with
the regulations of the SEC. We had no disagreements with Hirsch
Silberstein & Subelsky, P.C. on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure. J.
L. Stephan Co., P.C. has agreed to stand for re-election as the Company's
independent auditors for the fiscal year ending March 31, 2001, and the Board
recommends that this appointment be ratified. J. L. Stephan Co., P.C. has no
relationship with us other than that arising from its employment as independent
auditors. Representatives of J. L. Stephan Co., P.C. will be present at the
2000 Annual Meeting. They will have an opportunity to make a statement if they
desire to do so and will be available to respond to appropriate questions from
stockholders.
THE AFFIRMATIVE VOTE OF A MAJORITY OF THE OUTSTANDING SHARES OF THE
COMMON STOCK REPRESENTED AT THE 2000 ANNUAL MEETING IS REQUIRED TO RATIFY THE
APPOINTMENT OF J. L. STEPHEN CO., P.C. AS THE COMPANY'S INDEPENDENT AUDITORS FOR
THE YEAR ENDING MARCH 31, 2001. THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE
FOR THIS PROPOSAL.
STOCKHOLDER PROPOSALS FOR THE NEXT ANNUAL MEETING
Any proposal by a stockholder to be presented at the next annual meeting
must be received at the Company's principal executive offices, 1120 Finch Avenue
West, Suite 303, North York, Ontario M3J 3H8 Canada, not later than March 31,
2001.
By Order of the Board of Directors,
Bruce I. Lewis, Chief Executive Officer
Dated: September 20, 2000
10
<PAGE>
THE TRACKER CORPORATION OF AMERICA, INC.
1120 FINCH AVENUE WEST, SUITE 303
NORTH YORK, ONTARIO M3J 3H8
CANADA
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
KNOW ALL MEN BY THESE PRESENTS that I, the undersigned stockholder of
The Tracker Corporation of America, a Delaware corporation, do hereby nominate,
constitute and appoint Bruce I. Lewis, my true and lawful attorney with full
power of substitution for me and in my name, place and stead, to vote all of the
capital stock of Tracker standing in my name on its books on September 15, 2000,
at the Annual Meeting of its Stockholders to be held in the Comfort Inn at 2361
Austin Parkway, Flint, Michigan 48507 on Friday, October 20, 2000 at 2:00 p.m.
local time, or at any adjournment thereof.
1. THE REELECTION OF MR. BRUCE I. LEWIS AS A DIRECTOR.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. THE REELECTION OF MR. CARL J. CORCORAN AS A DIRECTOR.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. RATIFICATION OF INDEPENDENT AUDITORS.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
IF NO BOX IS MARKED WITH RESPECT TO ANY OF THE PROPOSALS ABOVE, THE
UNDERSIGNED WILL BE DEEMED TO HAVE VOTED "FOR" THE PROPOSALS.
This Proxy, when properly executed, will be voted in the manner
directed herein by the undersigned stockholder. Please sign exactly as your
name appears hereon. When shares are held by joint tenants, both should sign.
When signing as attorney, executor, administrator, trustee, or guardian, please
give full title as such. If a corporation, please sign in full corporate name
by president or other authorized officer. If a partnership, please sign in
partnership name by authorized person. Make sure that the name on your stock
certificate(s) is exactly as you indicate below.
<PAGE>
Number of Shares owned:
----------------------------- ---------------------------------------
Signature
Print Name:
--------------------------------
(As registered on Stock Certificate)
-------------------------------------------
Signature if jointly held
Print Name:
--------------------------------
(As registered on Stock Certificate)
Date: September ___, 2000
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY ON OR BEFORE OCTOBER 18, 2000
BY USING THE ENCLOSED SELF-ADDRESSED ENVELOPE OR VIA FACSIMILE TO (416)
663-9699, ATTENTION: BRUCE I. LEWIS
[ ] Please check if you plan on attending the Annual Meeting.
2
<PAGE>
