SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (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(c) (2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11 (c) or Rule 14a - 12
FIND/SVP, 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) (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:
- --------------------------------------------------------------------------------
(5) Total fee paid:
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|_| Fee paid previously with preliminary materials:
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|_| Check box if any part of the fee us 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.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
FIND/SVP, INC.
625 Avenue of the Americas
New York, N.Y. 10011
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS - JUNE 30, 1998
--------------------
TO THE SHAREHOLDERS OF FIND/SVP, INC.:
Notice is hereby given that the Annual Meeting of Shareholders of
FIND/SVP, Inc. will be held at the Hotel Inter-Continental, 111 E. 48th Street,
New York City, New York, on June 30, 1998, at 9:15 a.m., New York City time, for
the following purposes:
1. To elect the Board of Directors to serve until the next Annual
Meeting of Shareholders and until their successors are duly elected
and qualified.
2. To ratify a proposed amendment to the Company's Certificate of
Incorporation to increase the number of authorized shares of common
stock, par value $.0001 per share, from 10,000,000 to 20,000,000.
3. To ratify the proposed amendment to the Company's 1996 Stock Option
Plan to increase the number of shares of Common Stock issuable
thereunder from 650,000 to 1,150,000.
4. To ratify the selection by the Board of Directors of KPMG Peat
Marwick LLP to serve as independent auditors for the year ending
December 31, 1998.
5. To transact such other business as may properly be presented for
action at the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on May 22, 1998 as
the record date for the determination of shareholders entitled to notice of, and
to vote at, this meeting or any adjournment thereof.
Holders of a majority of the outstanding shares must be present in person
or by proxy in order for the meeting to be held. WHETHER OR NOT YOU EXPECT TO
ATTEND THE ANNUAL MEETING, YOUR PROXY VOTE IS IMPORTANT. ACCORDINGLY, YOU ARE
REQUESTED TO MARK, SIGN AND DATE THE ENCLOSED PROXY FORM AND RETURN IT IN THE
ACCOMPANYING STAMPED ENVELOPE. The giving of such proxy will not affect your
right to revoke such proxy before it is exercised or to vote in person should
you later decide to attend the meeting.
All shareholders are cordially invited to attend the meeting.
By Order of the Board of Directors
/s/ Peter J. Fiorillo
Peter J. Fiorillo, Secretary
Dated: May 27, 1998
IT IS IMPORTANT THAT THE ENCLOSED PROXY FORM BE
COMPLETED AND RETURNED PROMPTLY.
<PAGE>
FIND/SVP, INC.
625 Avenue of the Americas
New York, N.Y. 10011
------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 30, 1998
SOLICITATION AND REVOCATION OF PROXIES
-------------------
This proxy statement is furnished in connection with the solicitation by
the Board of Directors of FIND/SVP, Inc., a New York corporation (the
"Company"), of proxies to be voted at the Annual Meeting of Shareholders of the
Company to be held at the Hotel Inter-Continental, 111 E. 48th St., New York
City, New York, on June 30, 1998, at 9:15 a.m., New York City time, and any
adjournment thereof.
A form of proxy is enclosed for use at the meeting. The proxy may be
revoked by a shareholder at any time before it is voted by execution of a proxy
bearing a later date or by written notice to the Secretary before the meeting,
and any shareholder present at the meeting may revoke his or her proxy thereat
and vote in person if he or she so desires. When such proxy is properly executed
and returned, the shares it represents will be voted at the meeting in
accordance with any instructions noted thereon. If no direction is indicated,
all shares represented by valid proxies received pursuant to this solicitation
(and not revoked prior to exercise) will be voted FOR the election of the
nominees for directors herein, FOR the proposed amendment to the Company's
Certificate of Incorporation to increase the number of authorized shares, FOR
the ratification and approval of the proposed amendment to the Company's Stock
Option Plan and FOR the ratification of the appointment of KPMG Peat Marwick LLP
as independent auditors.
The cost of soliciting proxies on behalf of the Board of Directors will be
borne by the Company. In addition to solicitation by mail, proxies may be
solicited by directors, officers or regular employees of the Company (who will
receive no extra compensation for these services) in person or by telephone or
telegraph. The Company will also request brokerage houses, custodians, nominees
and fiduciaries to forward these proxy materials to the beneficial owners of the
Common Stock, par value $.0001 per share, of the Company ("Common Stock") and
will reimburse such holders for their reasonable expenses in connection
therewith. The approximate date of mailing of this Proxy Statement and
accompanying proxy is May 27, 1998. All votes will be tabulated by the inspector
of election appointed for the meeting, who will separately tabulate affirmative
and negative votes, abstentions and broker non-votes. Abstentions will be
counted towards the tabulation of votes cast on proposals presented to the
shareholders and will have the same effect as negative votes. Broker non-votes
are counted towards a quorum, but are not counted for any purpose in determining
whether a matter has been approved.
Only shareholders of record on the close of business on May 22, 1998 will
be entitled to notice of, and to vote at, the Annual Meeting. At the close of
business on such record date, the Company had issued and outstanding 7,107,519
shares of Common Stock. Each share entitles the holder thereof to one vote and a
vote of a majority of the shares present, or represented, and entitled to vote
at the meeting is required to approve each proposal to be acted upon at the
meeting.
<PAGE>
NOMINATION AND ELECTION OF DIRECTORS
Eight directors, six of whom are members of the present Board of
Directors, are nominees for election to hold office until the next annual
meeting and until their respective successors are elected and qualified. Unless
authority to vote for the election of directors shall have been withheld, it is
intended that proxies in the accompanying form will be voted at the meeting for
the election of the eight nominees named below. If any nominee, for any reason
presently unknown to the Company, should refuse or be unable to serve, the
shares represented by proxy will be voted for such person as shall be designated
by the Board of Directors to replace any such nominee.
The following information is submitted concerning the nominees named for
election as directors based upon information received by the Company from such
persons:
Director
Nominee Age Office Since
------- --- ------ -----
Andrew P. Garvin 52 Chairman of the Board, 1969
President, Chief Executive
Officer and Director
Brigitte de Gastines 54 Director 1982
Howard S. Breslow 58 Director 1986
Frederick H. Fruitman 47 Director 1989
Charles Baudoin 78 Director 1990
Jean-Louis Bodmer 56 Director 1993
Peter J. Fiorillo 39 Executive Vice President, Chief --
Financial Officer, Treasurer,
Corporate Secretary, and Chief
Information Officer
Eric Cachart 41 - --
Mr. Garvin is a founder of the Company and has served as its Chief
Executive Officer and Chairman of the Board since 1972 and as its President
since 1978. Mr. Garvin has been a director of the Company since its inception.
Mr. Garvin was the Treasurer of the Company from its inception until 1997. From
1979 to 1982, Mr. Garvin was a member of the Board of Directors of the
Information Industry Association and served as Chairman of the 1979 National
Information Conference and Exposition. Mr. Garvin is the author of The Art of
Being Well Informed, an information resource handbook for executives. Mr. Garvin
received a B.A. degree in political science from Yale University and a M.S.
degree in Journalism from the Columbia Graduate School of Journalism. Mr. Garvin
is a director of Esquire Communications, Inc., a publicly held company engaged
in court reporting services.
Ms. de Gastines has been a director of the Company since 1982. She has
served as the General Manager of SVP International since 1985 and SVP, S.A.
since 1976.
2
<PAGE>
Mr. Breslow has been a director of the Company since 1986. He has been a
practicing attorney in New York City for more than 30 years and has been a
member of the law firm of Breslow & Walker LLP, New York, New York for more than
25 years, which firm is currently the Company's general counsel. Mr. Breslow
currently serves as a director of Cryomedical Sciences, Inc., a publicly held
company engaged in the research, development and sale of products for use in
low-temperature medicine; Vikonics, Inc., a publicly held company engaged in the
design and sale of computer-based security systems; Lucille Farms, Inc., a
publicly held company engaged in the manufacturing and marketing of cheese
products; and Excel Technology, Inc., a publicly held company engaged in the
development and sale of laser products.
Mr. Fruitman has been a director of the Company since June 1989. Since
April 1990, Mr. Fruitman has been a Managing Director of Loeb Partners
Corporation, an investment banking firm. From January 1989 to April 1990, he was
an independent financial consultant. From 1986 to December 1988, Mr. Fruitman
was a Senior Vice President of The Stuart-James Company Incorporated, an
investment banking firm. From 1984 to 1986, he was an associate at E.M. Warburg,
Pincus & Co., Inc. From 1982 to 1984, Mr. Fruitman was a Vice President of
Investors in Industry Corporation, a venture capital firm. Mr. Fruitman is a
director of Micro Warehouse, Inc., a publicly held company which is a direct
marketer of microcomputer software and peripheral products.
Mr. Baudoin has been a director of the Company since November 1990 and
previously served as a director of the Company from 1981 to June 1989. Since
1951, Mr. Baudoin has served as the President of Bova Trading, Inc., a financial
management firm. From 1954 to 1963, he served as President of the Dutch America
Mercantile Corporation, a finance company. From 1963 to 1967, he was the
President of C.I.F. Inc., a finance company. From 1967 to 1983, Mr. Baudoin
served as the President of Merban Corporation, a finance company. From 1983 to
1987, he also served as Chairman and Chief Executive Officer of Contitrade
Services Corporation and Merban Americas Corporation, finance companies. Since
1987, Mr. Baudoin has served as the Chairman of ECOBAN Finance Ltd.
Mr. Bodmer has been a director of the company since 1993. He has served as
General Manager of SVP France since 1974. Other positions which he currently
holds are Chief Executive Director of SVP, S.A., President and Chief Executive
Officer of SVP Participation, President of SVP Belgium and President of SVP
United Kingdom.
Mr. Fiorillo has been the Company's Executive Vice President since
November 1994, Chief Financial Officer since 1991 and Treasurer, Corporate
Secretary and Chief Information Officer since 1997, and was Vice President
Finance and Administration from 1991 to November 1994 and Assistant Corporate
Secretary from 1994 to 1997. Since 1996, Mr. Fiorillo had served as President of
FIND/SVP Internet Services, Inc. which ceased operations on December 31, 1997.
From 1987 until 1991, Mr. Fiorillo was employed by Robert Half of New York,
Inc., a financial executive recruiting firm, including as President from 1989 to
1991. Prior thereto he was the Controller of Profit Freight Systems, Inc., a
large publicly held international freight forwarder; the Vice President of
Finance of Carl Byoir & Associates, the third largest international public
relations firm; and a Certified Public Accountant with Arthur Young & Company.
Mr. Fiorillo received a B.A. degree from Franklin & Marshall College and is a
Certified Public Accountant in New York State.
Mr. Cachart is the associate general manager of SVP, S.A. and has served
as President of SVP Multi-info since 1995. He was named President of SVP Network
in 1998. Prior to 1995, he was a journalist and news commentator for French
television networks.
3
<PAGE>
BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors held eight meetings during the year ended December
31, 1997. Each of the directors standing for re-election attended at least 75%
of the meetings in 1997, except that Mr. Bodmer attended four meetings and Ms.
de Gastines attended three meetings.
The Company has a Stock Option Committee of the Board of Directors,
currently consisting of Howard S. Breslow, Charles Baudoin and Frederick H.
Fruitman. The Stock Option Committee held five meetings in 1997. The Company
formed an Audit Committee on February 18, 1998 consisting of Charles Baudoin,
Jean-Louis Bodmer and Frederick Fruitman. The purpose of the Audit Committee is
to review the adequacy of the Company's internal controls and to meet
periodically with management and the independent auditors. The Company has no
other compensation committee or any nominating or other committees performing
similar functions.
No family relationship exists between any director or executive officer
and any other director or executive officer, except that Ms. de Gastines, a
director, and Mr. Cachart, a director nominee, are married.
4
<PAGE>
BENEFICIAL OWNERSHIP OF THE COMPANY'S SECURITIES
The following table sets forth, as of March 31, 1998, certain information
with respect to the beneficial ownership of the Common Stock by each person
known by the Company to be the beneficial owner of 5% or more of its outstanding
Common Stock, by each director and director nominee of the Company and by all
officers and directors as a group.
Name and Address Amount of Percent
Beneficial Owner Shares Owned(1) of Class
---------------- --------------- --------
Andrew P. Garvin(2) 1,254,754 16.5%
625 Avenue of the Americas
New York, N.Y. 10011
Amalia S.A. 3,075,085 40.8%
70, rue des Rosiers
F-93585 Saint-Ouen, Cedex
FRANCE(3)
Brigitte de Gastines(4) 23,000 Less than 1%
Howard S. Breslow(4)(5) 31,820 Less than 1%
Frederick H. Fruitman(6) 58,679 Less than 1%
Charles Baudoin(4)(7) 62,225 Less than 1%
Jean-Louis Bodmer(4) 13,000 Less than 1%
Peter J. Fiorillo(8) 212,000 2.9%
Eric Cachart -- --
Furman Selz SBIC, L.P.
230 Park Avenue
New York, NY 10169(9) 900,000 11.2%
All Officers and Directors
as a group (8 persons)(10) 1,716,478 21.8%
----------------------------------------------
5
<PAGE>
(1) Unless otherwise indicated below, all shares are shares of Common Stock
owned beneficially and of record.
(2) Includes 483,500 shares issuable under outstanding options.
(3) Includes the 422,222 shares issuable under outstanding warrants held by
SVP, S.A., the 2,158,100 shares of Common Stock owned by SVP, S.A. and the
494,763 shares of Common Stock owned by SVP International, which are
subsidiaries of Amalia S.A. Brigitte de Gastines owns in excess of 99% of
the stock of Amalia S.A. In addition, Ms. de Gastines is President,
General Manager and a director of SVP, S.A., and General Manager of SVP
International. The shares owned by Amalia S.A. are not shown in the table
as being owned by Ms. de Gastines.
(4) Includes 13,000 shares issuable under outstanding options.
(5) Includes the 13,820 shares of Common Stock held on behalf of Breslow &
Walker LLP, a law firm in which Mr. Breslow is a partner.
(6) Includes 10,500 shares issuable under outstanding options.
(7) Includes 39,225 shares of Common Stock owned of record by Bova Trading, of
which Charles Baudoin has beneficial ownership.
(8) Includes 158,000 shares issuable under outstanding options.
(9) Includes the 900,000 shares issuable under outstanding warrants.
(10) Includes 761,000 shares issuable under outstanding options and 4,000
shares issuable under outstanding warrants.
The following persons have failed to file on a timely basis certain
reports required by Section 16(a) of the Exchange Act of 1934 (the "Exchange
Act"): During the year ended December 31, 1997, SVP and its affiliates did not
file Forms 4 with respect to the following transactions (as described in this
and prior reports filed by the Company): the purchases by SVP in November 1996
and August 1997 of Notes and warrants from the Company. The Company understands
that the Forms 4 are currently being prepared.
6
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding compensation
paid by the Company during each of the Company's last three years to the
Company's Chief Executive Officer and to each of the Company's executive
officers who received salary and bonus payments in excess of $100,000 during the
year ended December 31, 1997.
<TABLE>
<CAPTION>
Long Term Compensation
---------------------------------
Annual Compensation Awards Payouts
--------------------------- ------ -------
Securities
Name and Other Restricted Underlying LTIP All
Principal Salary Bonus Annual Stock Options Payout Other
Positions Year ($) ($) Comp. Awards($) (#)(1) ($) Comp.
--------- ---- ------- ------ ------ ------ ------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Andrew P. Garvin 1997 253,867 50,000 -- -- -- -- --
Chairman of the Board,
President, Chief 1996 249,976 12,500 -- -- 350,000 -- --
Executive Officer and
Director 1995 235,937 25,000 -- -- 69,000 -- --
Peter J. Fiorillo 1997 185,671 11,500 -- -- -- -- --
Executive Vice
President, Chief 1996 154,476 12,000 -- -- 125,000 -- --
Financial Officer, Chief
Information Officer, 1995 154,476 10,000 -- -- 6,000 -- --
Treasurer and
Corporate Secretary
John D. Kuranz 1997 150,200 -- -- -- -- -- --
Vice President,
Managing Director, 1996 149,976 -- -- -- -- -- --
Published Research
Division 1995 149,976 12,850 -- -- -- -- --
</TABLE>
- ----------
(1) Options to acquire Common Stock.
7
<PAGE>
OPTION GRANTS DURING 1997
During 1997 there were no options granted to the named executive officers.
OPTION EXERCISES DURING 1997
AND YEAR END OPTION VALUES
The following table provides information related to options exercised by the
named executive officers during the year ended December 31, 1997 and the number
and value of options held at year end. The Company does not have any outstanding
stock appreciation rights
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money
Options at Options at
Year End(#) Year End($)(1)
----------- --------------
Shares Acquired Value
Name On Exercise(#) Realized($) Exercisable Unexercisable Exercisable Unexercisable
---- -------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Andrew P. Garvin 5,000 2,475 143,500 340,000 -- --
Peter J. Fiorillo -- -- 95,500 66,500 -- --
John D. Kuranz -- -- 49,800 11,200 -- --
</TABLE>
--------------------------------
(1) The closing trading price of the Company's Common Stock as reported by
NASDAQ on December 31, 1997 was $0.75. Value is calculated on the
difference between the option exercise price of in-the-money options and
$0.75 multiplied by the number of shares of Common Stock underlying the
option.
EMPLOYMENT AND RELATED AGREEMENTS
On January 1, 1996, the Company entered into an Employment Agreement with
Andrew P. Garvin commencing on January 1, 1996 and terminating on December 31,
2001 (the "Employment Agreement"). Such Employment Agreement was amended and
restated on December 12, 1996. The Employment Agreement provides for a base
salary of $250,000 which will be adjusted each January 1 for a cost of living
increase based on the Consumer Price Index for New York City for the twelve
month period immediately preceding such January 1 date. Mr. Garvin will also be
entitled to additional increases in base salary as may be determined from time
to time by the Board of Directors or any compensation committee appointed by the
Board of Directors. Mr. Garvin received a $12,500 signing bonus upon execution
of the Employment Agreement. In addition, Mr. Garvin will be entitled to receive
performance bonuses equal to 10% per annum of the pre-tax profits of the Company
in excess of $1,000,000 for each of the years ended December 31, 1996, 1997,
1998, 1999, 2000, and 2001. The Employment Agreement limits the bonus to
$250,000 in any year, and states that Mr. Garvin is entitled to receive a cash
bonus of $50,000 in each of January 1997 and January 1998. During August 1997,
Mr. Garvin voluntarily took a 5% salary cut for the balance of 1997.
8
<PAGE>
The Employment Agreement provides that (i) if Mr. Garvin voluntarily
leaves the employ of the Company on account of the Company being acquired and
its principal office being moved to a location which is greater than 50 miles
from New York City; and (ii) if Mr. Garvin voluntarily leaves the employ of the
Company on account of a Change in Control, then, in each such case, he shall be
entitled to receive the compensation described in the immediately preceding
paragraph for the balance of the term; provided, however, that if such
termination occurs at a time when there is less than one year left in the term,
the compensation shall continue for a period of two years from the date of
termination on the same basis that the employee received compensation during the
last year of the term. Change of Control is defined in the Employment Agreement
to include the acquisition by a party of 30% or more of the outstanding shares
of Common Stock of the Company or a change in the majority of the Incumbent
Board of Directors (as defined in the Employment Agreement). In the event that
the Company terminates Mr. Garvin's employment for cause, and a court of law or
other tribunal ultimately determines that such termination was without cause,
then he shall be entitled to receive double the amount of compensation described
above until the end of the term. Mr. Garvin has agreed to a non-competition
covenant for a period of two years after the term of the Employment Agreement.
The Company has entered into a deferred compensation agreement with Mr.
Garvin, which provides for a schedule of payments to him or his designated
beneficiary(ies). The agreement entered into in 1984 provides that in the event
during the course of employment Mr. Garvin (i) dies, (ii) becomes totally
disabled or (iii) elects to retire after June 30, 1994 and prior to age 65, he
or, in the event of death, his designated beneficiaries, shall receive monthly
payments ranging from $1,250 to $1,800 for a period of ten years from the date
of death, disability or retirement. In the event Mr. Garvin retires at age 65 or
over, Mr. Garvin shall receive $4,750 per month for ten years from the date of
his retirement.
The Company entered into an additional Deferred Compensation Agreement
with Mr. Garvin in 1990. Pursuant thereto, in the event during the course of
employment Mr. Garvin (i) dies, (ii) becomes totally disabled or (iii) elects to
retire after July 25, 1992 and prior to age 65, he or, in the event of death,
his designated beneficiary(ies), shall receive monthly payments ranging from
$618.81 to $2,351. These payments are to continue for a period of ten years from
the date of death, disability or retirement. In the event he retires at age 65
or over, Mr. Garvin shall receive $2,475.24 per month for ten years from the
date of his retirement. The benefits under the two agreements are cumulative.
On January 11, 1995, the Company entered into severance agreements with
Peter J. Fiorillo and John D. Kuranz. The severance agreements provide for the
payment of the current base salary (with set minimum limits for purposes of the
payment) to the respective individual for a period of one year from the date of
termination for (i) termination without cause; and (ii) if the individual
voluntarily leaves the employ of the Company because of a change of control or
because Andrew P. Garvin is no longer Chief Executive Officer. Additionally, if
the above occurs, all options granted to the respective individual by the
Company shall become immediately vested and exercisable. Change of control is
defined in the severance agreements to include the acquisition by a party of 30%
or more of the outstanding shares of Common Stock of the Company or a change in
the majority of the incumbent Board of Directors. In the event that the Company
terminates Mr. Fiorillo or Mr. Kuranz for cause, and a court of law or other
tribunal ultimately determines that such termination was without cause, then the
respective individual shall be entitled to receive double the amount of
compensation described above.
9
<PAGE>
During February 1998, SVP, S.A. acquired additional shares in the Company
which brought their total holdings, including its affiliates, in the Company
above 30% of the then outstanding shares. As such, Mr. Garvin, Mr. Fiorillo and
Mr. Kuranz would be entitled to receive their respective severance packages
should they choose to resign due to this previously defined change in control,
and their unvested options would immediately vest. In consideration of SVP, S.A.
providing a $2,000,000 letter of credit, in March 1998, to secure the Company's
debt agreements with a commercial bank, on March 29, 1998, Mr. Garvin waived his
rights related to the change of control provision in his agreement, only as it
relates to the holdings of SVP, S.A. and its affiliates, in the Company. To
date, Mr. Fiorillo and Mr. Kuranz have not expressed their intent to resign. If
such two executive officers were to tender their resignation based on this
occurrence, the liability would be approximately $340,000, payable over a one
year period, plus the vesting of 78,833 currently non-exercisable options.
Directors are not compensated for their services as such, except that the
1996 Stock Option Plan of the Company provides for the automatic grant to
outside directors of five-year non-incentive options to purchase 2,500 shares of
Common Stock on the first business day of each new year, the exercise price
being the fair market value on the date of the grant.
10
<PAGE>
REPORT OF THE BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
The Company operates in the research, business intelligence and knowledge
service industry and must attain high levels of quality in the servicing of its
clients. In order to succeed, the Board believes that it must be able to attract
and retain qualified experienced executives. To achieve this goal, the Company
has offered competitive executive compensation to attract and retain key
executives with relevant experience in the industry or in growth companies in
related industries. Executive compensation has also been structured to align
management's interests with the success of the Company by making a portion of
compensation dependant on long term success of the Company.
During 1997, the entire Board of Directors held primary responsibility for
determining executive compensation levels. The Board as a whole has maintained a
philosophy that compensation of executive officers, specifically including that
of the President and Chief Executive Officer, should be directly linked to
operating achievements and, to a lesser extent, stock performance.
Over the past five years the revenues of the Company have increased over
76% and the retainer client base has grown each quarter since the Company's
inception. These achievements have been reflected in executive compensation and,
specifically, in the compensation of the Company's President and Chief Executive
Officer, with whom the Company entered into a six year employment agreement on
January 1, 1996. In addition, the Company has utilized stock options to link
executive compensation to stock price performance. All executive officers,
including the President and Chief Executive Officer, have been granted stock
options so that they will benefit financially from long term success of the
Company and increases in the price of the Company's Common Stock.
The Board of Directors
Andrew P. Garvin
Brigitte de Gastines
Howard S. Breslow
Frederick H. Fruitman
Charles Baudoin
Jean-Louis Bodmer
11
<PAGE>
STOCK OPTION PLAN
On January 29, 1996, the Company adopted its 1996 Stock Option Plan (the
"Plan") for employees, including officers, and directors of the Company
(aggregating 234 persons at December 31, 1997). The Plan covers 650,000 shares
of Common Stock (subject to adjustment to cover stock splits, stock dividends,
recapitalizations and other capital adjustments). In addition, the Plan allows
options to be granted thereunder to consultants and advisors to the Company,
provided they render bona fide services to the Company and such services are not
in connection with the offer or sale of securities in a capital raising
transaction. The options to be granted under the Plan will be designated as
incentive stock options or non-incentive stock options by the Board of Directors
or a committee thereof, which also will have discretion as to the persons to be
granted options, the number of shares subject to the options and the terms of
the option agreements. Only employees, including officers of the Company, may be
granted incentive stock options. The options to be granted under the Plan and
designated as incentive stock options are intended to receive incentive stock
option tax treatment pursuant to Section 422 of the Internal Revenue Code, as
amended (the "Code").
The Plan provides that all options thereunder shall be exercisable during
a period of no more than ten years from the date of grant (five years for
options granted to holders of 10% or more of the outstanding shares of Common
Stock), depending upon the specific stock option agreement, and that the option
exercise price shall be at least equal to 100% of the fair market value of the
Common Stock at the time of grant (110% for options granted to holders of 10% or
more of the outstanding shares of Common Stock). Pursuant to the provisions of
the Plan with respect to incentive stock options, the aggregate fair market
value (determined on the date of grant) of the Common Stock with respect to
which incentive stock options are exercisable for the first time by an employee
during any calendar year shall not exceed $100,000.
The Plan also permits optionees whose employment is terminated without
cause and other than by reason of death, disability or retirement at age 65,
three months from the date of termination to exercise their options. If the
employment of an optionee is terminated for cause and other than by reason of
death, disability or retirement at age 65, any options granted to the optionee
will terminate automatically. If employment is terminated by reason of
disability or retirement at age 65, the optionee may, within one year from the
date of termination, in the event of termination by reason of disability, or
three months from the date of termination, in the event of termination by reason
of retirement at age 65 (but not after the expiration of the option), exercise
the option. If employment is terminated by death, the person or persons to whom
the optionee's rights under the option are transferred by will or the laws of
descent and distribution have similar rights of exercise within three months
after such death (but not after the expiration of the option). Options are not
transferable otherwise by will or the laws of descent and distribution, and
during the optionee's lifetime are exercisable only by the optionee. Shares
subject to options which expire or terminate may be the subject of future
options. The Plan terminates January 28, 2006.
If shares are issued to the holder of a non-incentive option under the
Plan (1) no income will be recognized by the holder at the time of grant of the
option; (2) except as stated below, upon exercise of the option the holder will
recognize taxable ordinary income in an amount equal to the excess of the fair
market value of the shares over the option price; (3) if the holder exercising
the option is restricted from selling the shares so acquired because the holder
is an officer or director of the Company and would be subject to liability under
Section 16(b) of the Exchange Act, then, unless the holder makes an
12
<PAGE>
election to be taxed under the rule of clause (2) above, the holder will
recognize taxable ordinary income, at the time such Section 16(b) restriction
terminates, equal to the excess of the fair market value of the shares at that
time over the option price, and any dividends he or she receives on the shares
before that time will be taxable to him or her as compensation income; (4) the
Company will be entitled to a deduction at the same time and in the same amount
as the holder has income under clause (2) or (3); and (5) upon a sale of shares
so acquired, the holder may have additional short-term or long-term capital gain
or loss.
If shares are issued to the holder of an incentive stock option under the
Plan (1) no income will be recognized by such holder at the time of the grant of
the option or the transfer of shares to the holder pursuant to his or her
exercise of the option; (2) the difference between the option price and the fair
market value of the shares at the time of exercise will be treated as an item of
tax preference to the holder; (3) no deduction will be allowed to the Company
for Federal income tax purposes in connection with the grant or exercise of the
option; and (4) upon a sale or exchange of the shares after the later of (a) one
year from the date of transfer of the shares to the original holder, or (b) two
years from the date of grant of the option, any amount realized by the holder in
excess of the option price will be taxed to the holder as a long-term capital
gain, and any loss sustained by the holder will be a long-term capital loss. If
the shares are disposed of before the holding period requirements described in
the preceding sentence are satisfied, then (1) the holder will recognize taxable
ordinary income in the year of disposition in an amount determined under the
rules of the Code; (2) the Company will be entitled to a deduction for such year
in the amount of the ordinary income so recognized; (3) the holder may have
additional long-term or short-term capital gain or loss; and (4) the tax
preference provision might not be applicable.
The Plan also provides for the cashless payment of the exercise price of
options granted under the Plan by (A) delivery to the Company of shares of
Common Stock having a fair market value equal to such purchase price, (B)
irrevocable instructions to a broker to sell shares of Common Stock to be issued
upon exercise of the option, provided such shares are registered and
transferable, followed by delivery to the Company of the amount of sale proceeds
necessary to pay such purchase price, and delivery of the remaining cash
proceeds less commissions and brokerage fees to the optionee or delivery of the
remaining shares of Common Stock to the optionee, or (C) by any combination of
the methods of payment described in (A) and (B) above.
The Plan also provides that there will be granted to each outside director
on the first business day of each year a non-incentive stock option to purchase
2,500 shares of Common Stock at an exercise price equal to the fair market value
on the date of grant. For purposes of such grants, fair market value shall mean
the last closing bid price per share of the Common Stock, as quoted on the
NASDAQ System on the date of grant, or, in the event that the Common Stock is
also traded on an exchange, the higher of the NASDAQ price and the closing price
per share of the Common Stock on such exchange on the date of grant, or in the
event the Common Stock is only traded on an exchange, the closing price of the
Common Stock on the date of grant. Such options shall be immediately exercisable
and shall have a term of five years.
During the year ended December 31, 1997, options to purchase an aggregate
of 140,000 shares of Common Stock at prices ranging from $0.781 to $1.8125 per
share were granted under the Plan, including 15,000 options to directors of the
Company.
13
<PAGE>
PROPOSAL TO RATIFY AN AMENDMENT TO THE 1996 STOCK PLAN
Submitted for ratification by shareholders is an amendment to the Plan
which was approved by the Board of Directors on April 21, 1998, to increase the
number of shares of Common Stock issuable thereunder from 650,000 to 1,150,000.
The proposed amendment would allow for the maximum number of shares
issuable under the Plan to be increased by 500,000 shares, so that the total
shares issuable upon the exercise of all options will be increased to 1,150,000.
As of March 31, 1998, a total of 650,000 shares of Common Stock is authorized
for the purposes of the Plan and options to purchase 478,250 shares have been
issued and are outstanding. Accordingly, 8,450 have been exercised and only
163,300 shares remain available for issuance upon exercise of options granted
under the Plan. The Board believes that the additional shares are necessary to
encourage and enable key employees, directors and consultants to obtain a
proprietary interest in the Company through the ownership of stock, thereby
providing such persons with an added incentive to continue in the employ or
service of the Company and to stimulate their efforts in promoting the growth,
efficiency and profitablity of the Company, and affording the Company a means of
attracting to its services persons of outstanding quality.
The Board of Directors recommends the stockholders vote FOR approval of
the proposed amendment to the 1996 Stock Option Plan.
PROPOSAL TO AMEND THE COMPANY'S CERTIFICATE OF INCORPORATION
TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
On April 21, 1998, the Board of Directors of the Company approved an
amendment to the Company's Certificate of Incorporation to increase the number
of authorized shares of Common Stock from 10,000,000 to 20,000,000, and directed
that such amendment (a copy of which is attached hereto as Exhibit A) be
submitted for ratification and approval by the stockholders of the Company at
the Meeting.
Reasons for Increasing the Number of Authorized Shares of Common Stock
The proposed increase in authorized shares of Common Stock will enhance
the Company's flexibility in connection with possible future actions, such as
acquisitions, financing transactions, employee benefit plan issuances, stock
splits, stock dividends, and such other corporate purposes that may arise.
Having such authorized Common Stock available for issuance in the future would
give the Company greater flexibility and would allow additional shares of Common
Stock to be issued without the expense and delay of a special stockholders'
meeting. Such a delay might deny the Company the flexibility the Board views as
important in facilitating the effective use of the Common Stock. The Company is
not presently engaged in any negotiations with respect to the use of any shares
of the additional authorized Capital Stock, nor are there currently any
commitments, arrangements, or understandings with respect to the issuance of
such shares, except as it relates to increasing the number of shares issuable
under the 1996 Stock Option Plan as proposed above. As of May 22, 1998, the
number of issued and outstanding shares were 7,107,519, with an additional
2,731,185 shares of common stock underlying outstanding options and warrants and
options available for grant.
14
<PAGE>
Effect of the Increase
The increase of authorized shares of Common Stock will not alter the par
value of the Common Stock or the rights of the stockholders.
No Right of Appraisal
Under the New York General Corporation Law, the State in which the Company
is incorporated, dissenting stockholders are not entitled to appraisal rights
with respect to the Company's proposed amendment to its Certificate of
Incorporation to increase the number of authorized shares of Common Stock, and
the Company will not provide stockholders with any such right.
Voting Requirement
Approval of the proposal to increase the number of authorized shares of
Common Stock requires the affirmative vote of the holders of stock representing
a majority of the votes entitled to be cast at the Meeting.
The Board of Directors recommends that the stockholders vote FOR the
proposed amendment to the Company's Certificate of Incorporation to increase the
number of authorized shares of Common Stock.
15
<PAGE>
STOCK PERFORMANCE CHART
The following chart compares the yearly percentage change in the
cumulative total stockholder return on the Company's Common Stock for a period
of five years ended December 31, 1997, with the cumulative total return of the
NASDAQ Stock Market Index (U.S. companies), a broad market index, prepared for
NASDAQ by the Center for Research in Securities Prices ("CRSP") at the
University of Chicago, and the Peer Group Index, an index prepared by CRSP made
up of the selected NASDAQ traded companies. The comparison for each of the
periods assumes that $100 was invested on December 31, 1992, in each of the
Common Stock of the Company, the stocks included in the NASDAQ Stock Market
Index (U.S. Companies) and the stocks included in the Peer Group Index. These
indices which reflect the assumption of reinvestment of dividends, do not
necessarily reflect returns that could be achieved by individual investors.
[The following table was depicted as a line chart in the printed material.]
STOCK PERFORMANCE
CRSP NASDAQ
Date Find/SVP, Inc.(2) Peer Group Index(1)(2) Stock Market Index(2)(3)
================================================================================
12/31/92 100.000 100.000 100.000
12/31/93 92.857 114.791 95.758
12/31/94 117.857 112.207 112.906
12/31/95 114.286 158.689 159.634
12/31/96 103.571 195.182 213.242
12/31/97 42.857 239.576 234.520
(1) The Peer Group Index consists of NASDAQ Stocks in SIC#8740-8749(U.S.
companies).
(2) Annualized returns for FIND/SVP, Inc., the CRSP Index for NASDAQ Stock
Market (U.S. and foreign) and the Peer Group Index are comprised of total
market return for all stocks in the index.
(3) The CRSP Index for the NASDAQ Stock Market (U.S. companies) includes total
returns on all domestic common shares and ADR's traded on the NASDAQ
National Market and NASDAQ Small-Cap Market and is comprised of their
annualized total market return.
------------------------------
16
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Since 1971, the Company has been a licensee of SVP International. Pursuant
to this license agreement, the Company pays royalties to SVP International for
the use of the SVP name and participation in the SVP International network. The
royalties for 1997 to SVP International were approximately $131,000. SVP
International is a subsidiary of Amalia S.A., a principal shareholder of the
Company.
Howard S. Breslow, a director of the Company, is a member of Breslow &
Walker LLP general counsel to the Company. During 1997, Breslow & Walker LLP
received legal fees of $75,653.
Andrew P. Garvin, Chairman of the Board, President and Chief Executive
Officer of the Company, entered into an Agreement (the "First Refusal
Agreement"), dated as of November 6, 1992, with Amalia S.A. and its
subsidiaries, SVP International and SVP, S.A. (Collectively "Amalia"). Amalia
beneficially owns 3,075,085 shares of Common Stock, or 40.8% of outstanding
shares, and Brigitte de Gastines, a director of the Company, owns in excess of
99% of the stock of Amalia S.A. The First Refusal Agreement provides for mutual
rights of first refusal in the event that either Mr. Garvin or Amalia desires to
dispose, in a public or private transaction, any of the shares of Common Stock
owned by them. In the event that a party declines to exercise its right of first
refusal, the proposed selling party may consummate such sale within the time
period permitted under the First Refusal Agreement. The First Refusal Agreement
terminated in October, 1997.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has selected the accounting firm of KPMG Peat
Marwick LLP to serve as independent auditors of the Company to perform the
annual audit for year ending December 31, 1998 and proposes the ratification of
such decision. A representative of KPMG Peat Marwick LLP is expected to be
present at the annual meeting. He or she will have the opportunity to make a
statement if he or she so desires to do so and will be available to respond to
appropriate shareholder questions.
The Board of Directors recommends a vote FOR ratification of the selection
of KPMG Peat Marwick LLP as independent auditors for the Company for the year
ending December 31, 1998.
SHAREHOLDERS PROPOSAL
Shareholders who wish to present proposals for action at the 1999 Annual
Meeting of Shareholders should submit their proposals in writing to the
Secretary of the Company at the address of the Company set forth on the first
page of this Proxy statement. Proposals must be received by the Secretary no
later than January 28, 1999 for inclusion in next year's proxy materials.
ANNUAL REPORT TO SHAREHOLDERS
The Annual Report to Shareholders of the Company for the year ended
December 31, 1997, including audited financial statements, has been mailed to
the shareholders concurrently herewith, but such report is not incorporated in
this Proxy Statement and is not deemed to be a part of the proxy solicitation
material.
17
<PAGE>
OTHER MATTERS
The Board of Directors of the Company does not know of any other matters
that are to be presented for action at the Annual Meeting of Shareholders. If
any other matters are properly brought before the meeting or any adjournment
thereof, the persons named in the enclosed proxy will have the discretionary
authority to vote all proxies received with respect to such matters in
accordance with their best judgments.
By Order of the Board of Directors
/s/ Peter J. Fiorillo
Peter J. Fiorillo, Secretary
New York, New York
May 27, 1998
SHAREHOLDERS ARE URGED TO SPECIFY THEIR CHOICES, DATE, SIGN AND RETURN THE
ENCLOSED PROXY IN THE ENCLOSED ENVELOPE. PROMPT RESPONSE IS HELPFUL AND YOUR
COOPERATION WILL BE APPRECIATED.
18
<PAGE>
EXHIBIT A
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
FIND/SVP, INC.
UNDER SECTION 805 OF THE
BUSINESS CORPORATION LAW
------------------------------------
The undersigned, being the President and Secretary, respectively, of
FIND/SVP, Inc. (the "Corporation"), pursuant to Section 805 of the New York
Business Corporation Law, do hereby certify as follows:
FIRST: The name of the Corporation is FIND/SVP, INC. and the name under
which it was formed is Information Clearing House, Inc.
SECOND: The Certificate of Incorporation of the Corporation was originally
filed by the department of state on November 10, 1969.
THIRD: The Certificate of Incorporation of the Corporation, as now in full
force and effect, is hereby amended to effect the following amendment authorized
by Section 801 of the New York Business Corporation Law:
ARTICLE FOURTH of the Certificate of Incorporation is hereby amended to
increase the number of authorized shares of common stock, par value $.0001 per
share, of the Corporation from 10,000,000 to 20,000,000 and, in accordance
therewith, ARTICLE FOURTH, as herein amended, shall read as follows:
"FOURTH: The corporation is authorized to issue two classes of stock to be
designated respectively "Common Stock" and "Preferred Stock." The total
number of shares of stock which the Corporation shall have authority to
issue is Twenty-two Million (22,000,000). The total number of shares of
Common Stock which the Corporation shall have authority to issue is Twenty
Million (20,000,000), par value $.0001 per share. The total number of
shares of Preferred Stock which the corporation shall have authority to
issue is Two Million (2,000,000), par value $.0001 per share. The shares
of Preferred Stock may be issued from time to time in one or more series.
The Board of Directors of the corporation, by the unanimous approval of
its members, is authorized to determine or alter any or all of the
designations, powers, preferences and rights,
<PAGE>
and the qualifications, limitations or restrictions thereof, in respect of
the wholly unissued class of Preferred Stock or any wholly unissued series
of Preferred Stock, and to fix or alter the number of shares comprising
any series of Preferred Stock (but not below the number of shares of any
such series then outstanding.)"
FOURTH: This Certificate of Amendment to the Certificate of Incorporation
was authorized by vote of a majority of the Board of Directors of the
Corporation followed by vote of the holders of a majority of all outstanding
shares entitled to vote thereon at a meeting of shareholders.
IN WITNESS WHEREOF, we have executed this Certificate in the name and on
behalf of FIND/SVP, Inc., on the ____ day of _______, 1998, and do affirm, under
the penalties of perjury, that the statements contained herein have been
examined and are true, correct and complete.
FIND/SVP, INC.
By:
-----------------------
Andrew P. Garvin
President
By:
-----------------------
Peter J. Fiorillo
Secretary
<PAGE>
PROXY
FIND/SVP, INC.
625 Avenue of the Americas New York, New York 10011
This Proxy is solicited on behalf of the Board of Directors
The undersigned, acknowledging receipt of the proxy statement dated May 27, 1998
of FIND/SVP, Inc., hereby constitutes and appoints Andrew P. Garvin and Peter J.
Fiorillo, and each or any of them, attorney, agent and proxy of the undersigned,
with full power of substitution to each of them, for and in the name, place and
stead of the undersigned, to appear and vote all the shares of stock of
FIND/SVP, Inc., standing in the name of the undersigned on the books of said
corporation on May 22, 1998, at the Annual Meeting of Shareholders of FIND/SVP,
Inc., to be held at the Hotel Inter-Continental, 111 E. 48 St., New York City,
New York, on June 30, 1998 at 9:15 a.m., New York City time, and any and all
adjournments thereof. When properly executed, this proxy will be voted as
designated by the undersigned. If no choice is specified, the proxy will be
voted FOR the election of directors and FOR the following proposals, which are
set forth in the Proxy Statement.
1. ELECTION OF DIRECTORS
|_| FOR all nominees listed below (except as written in on the line below)
Andrew P. Garvin, Brigitte de Gastines, Howard S. Breslow, Frederick H.
Fruitman, Charles Baudoin, Jean-Louis Bodmer, Peter J. Fiorillo, Eric
Cachart
|_| WITHHOLD AUTHORITY
|_| For ALL Nominees
|_| For the individual(s) listed below (Instruction: To withhold
authority to vote for any individual nominee, please write in name
on line below)
--------------------------------------------------------------------------
|_| ABSTAIN
2. AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION TO INCREASE THE
NUMBER OF AUTHORIZED SHARES OF COMMON STOCK, PAR VALUE $.0001 PER SHARE, FROM
10,000,000 TO 20,000,000.
|_| FOR |_| AGAINST |_| ABSTAIN
<PAGE>
3. AMENDMENT TO THE 1996 STOCK OPTION PLAN TO INCREASE THE NUMBER OF SHARES OF
COMMON STOCK ISSUABLE THEREUNDER FROM 650,000 TO 1,150,000.
|_| FOR |_| AGAINST |_| ABSTAIN
4. PROPOSAL TO RATIFY THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS FOR THE YEAR ENDING DECEMBER 31, 1998.
|_| FOR |_| AGAINST |_| ABSTAIN
5. FOR SUCH OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING AND ANY
ADJOURNMENTS THEREOF.
,1998
---------------------------------
Date
--------------------------------------
Signature
--------------------------------------
Signature, if held jointly
Please sign exactly as your name appears hereon. When shares are held by joint
tenants, both should sign. When signing as attorney, 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.
PLEASE MARK, SIGN, DATE AND RETURN THE
PROXY CARD PROMPTLY IN THE ENCLOSED ENVELOPE.
