<PAGE>
================================================================================
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
DICK CLARK PRODUCTIONS
- --------------------------------------------------------------------------------
(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:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(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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Notes:
<PAGE>
DICK CLARK PRODUCTIONS, INC.
------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD NOVEMBER 4, 1997
------------------------------------------------------
The Annual Meeting of Stockholders of dick clark productions, inc., a
Delaware corporation, will be held at The Penn Club, 30 West 44th Street, 10th
Floor, Banquet Room, New York, New York, on Tuesday, November 4, 1997, at
11:30 a.m., local time, for the following purposes:
1. To elect seven members of the Board of Directors to serve until the
next annual meeting and until their successors have been elected and
qualified.
2. To approve and adopt a shareholder's resolution with respect to the
bonus award provisions (the "Bonus Awards") contained in Employment
Agreements for Mr. Clark, the Chairman and Chief Executive Officer of the
Company, and Mr. La Maina, the President and Chief Operating Officer of the
Company, in order for the payments of such Bonus Awards, if any, to qualify
as "performance-based" compensation within the meaning of Section 162(m) of
the Internal Revenue Code of 1986, as amended.
3. To ratify the appointment of Arthur Andersen LLP as dick clark
productions, inc.'s independent accountants for the fiscal year ending June
30, 1998.
4. To transact such other business as may properly come before the Annual
Meeting or any and all postponements or adjournments thereof.
Only stockholders of record at the close of business on September 19, 1997,
shall be entitled to notice of and to vote at the Annual Meeting or any and
all postponements or adjournments thereof. A complete list of holders of
common stock entitled to vote at the Annual Meeting, arranged in alphabetical
order and showing the address of each stockholder and the number of shares
registered in the name of each stockholder, will be available at the Annual
Meeting and will be available for examination by any stockholder for any
purpose germane to the Annual Meeting during ordinary business hours for a
period of ten days prior to the Annual Meeting at the offices of dick clark
productions, inc., 3003 West Olive Avenue, Burbank, California 91510-7811.
By order of the Board of Directors
/s/ Martin Eric Weisberg
Martin Eric Weisberg
Secretary
September 30, 1997
Burbank, California
IMPORTANT
TO ASSURE PROPER REPRESENTATION AT THE ANNUAL MEETING, ALL STOCKHOLDERS ARE
REQUESTED TO FILL IN AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY
IN THE ACCOMPANYING ENVELOPE.
<PAGE>
DICK CLARK PRODUCTIONS, INC.
3003 WEST OLIVE AVENUE
BURBANK, CALIFORNIA 91510-7811
---------------------
PROXY STATEMENT
---------------------
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 4, 1997
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of dick clark productions, inc., a Delaware corporation
(the "Company"), of proxies for use at the Annual Meeting of Stockholders (the
"Annual Meeting") to be held at The Penn Club, 30 West 44th Street, 10th
Floor, Banquet Room, New York, New York, on Tuesday, November 4, 1997, at
11:30 a.m., local time, or any and all postponements or adjournments thereof,
for the purposes set forth in the accompanying Notice of Annual Meeting.
This Proxy Statement, Notice of Annual Meeting and accompanying proxy card
are first being mailed to stockholders on or about October 6, 1997.
A copy of the Company's Annual Report for the fiscal year ended June 30,
1997 ("fiscal 1997"), is being sent to each stockholder of record as of
September 19, 1997, together with this Proxy Statement.
GENERAL INFORMATION
Stockholders of record at the close of business on September 19, 1997, will
be entitled to notice of, and to vote the shares of Common Stock of the
Company, $.01 par value ("Common Stock"), and the shares of Class A Common
Stock of the Company, $.01 par value ("Class A Common Stock"), held by them on
such date, at the Annual Meeting or any and all postponements or adjournments
thereof. The Common Stock and the Class A Common Stock are the Company's only
classes of outstanding voting securities. Each share of Common Stock entitles
the holder thereof to one vote and each share of Class A Common Stock entitles
the holder thereof to ten votes. On September 19, 1997, there were 7,631,500
shares of Common Stock and 750,000 shares of Class A Common Stock outstanding
and entitled to vote at the Annual Meeting.
If the accompanying proxy card is properly signed and returned to the
Company and not revoked, it will be voted in accordance with the instructions
contained therein. Unless contrary instructions are given, the persons
designated as proxy holders in the accompanying proxy card will vote for the
Board of Directors' nominees for director, for the ratification of the
employment agreements for Mr. Clark and Mr. La Maina for purposes of Section
162(m) of the Internal Revenue Code of 1986, as amended, for ratification of
the appointment of Arthur Andersen LLP as the Company's independent
accountants for the fiscal year ending June 30, 1998 ("fiscal 1998"), and in
their own discretion as to all other matters as may properly come before the
Annual Meeting. Each such proxy granted may be revoked by the stockholder
giving such proxy at any time before it is exercised by filing with the
Secretary of the Company, at the address set forth above, a revoking
instrument or a duly executed proxy bearing a later date. The powers of the
proxy holders will be suspended if the person who executed a proxy attends the
Annual Meeting in person and so requests. Attendance at the Annual Meeting
will not in itself constitute revocation of a proxy.
The presence at the Annual Meeting, in person or by proxy, of the holders of
one-third of the aggregate shares of Common Stock and Class A Common Stock
outstanding at the close of business on September 19, 1997, will constitute a
quorum.
<PAGE>
PROPOSAL 1.
ELECTION OF DIRECTORS
A Board of seven directors is to be elected at the Annual Meeting. The Board
of Directors proposes the election of the following seven nominees to serve
until the next Annual Meeting and until their successors are duly elected and
qualified:
Richard W. Clark
Karen W. Clark
Francis C. La Maina
Enrique F. Senior
Lewis Klein
Jeffrey B. Logsdon
Robert A. Chuck
All of the nominees are present members of the Board of Directors. The Board
has no reason to believe that any of the foregoing nominees will not serve if
elected, but if any of them should become unavailable to serve as a director
or be withdrawn from nomination, and if the Board of Directors shall designate
a substitute nominee, the persons named as proxy holders will vote for the
substitute.
If elected, all nominees are expected to serve until the 1998 Annual Meeting
of Stockholders and until their successors are duly elected and qualified.
BUSINESS EXPERIENCE OF NOMINEES FOR ELECTION AS DIRECTORS
Richard W. Clark
Director since: 1957
Age: 67
Richard ("Dick") W. Clark has been Chairman and Chief Executive Officer and
a director of the Company since its inception. He acts as executive producer
on almost all of the television programs produced by the Company. Mr. Clark is
also Chairman of United Stations Radio Networks Inc., a privately held radio
network. Mr. Clark is the principal stockholder, as well as a director and
executive officer, of Olive Enterprises, Inc., a Pennsylvania corporation
("Olive"). Olive is a company controlled by Mr. Clark. Mr. Clark also acts and
performs on a freelance basis.
Karen W. Clark
Director since: 1977
Age: 55
Karen W. Clark became Vice President--Administration of the Company in July
1986 and was Secretary of the Company from 1977 to 1987. She serves as
production assistant on many of the Company's television programs and is the
Company's administrative coordinator. Ms. Clark is the wife of Richard W.
Clark.
Francis C. La Maina
Director since: 1974
Age: 58
Francis C. La Maina became President of the Company in July 1986. Mr. La
Maina serves as executive in charge of production on all television shows
produced by the Company. From 1977 to 1986, he was Executive Vice President of
the Company, and from 1974 to 1977, he was Vice President--Business Affairs of
the Company. From 1966 to 1974, he served as Controller of the Company and as
an associate producer. Mr. La Maina provides business related services to Mr.
Clark in connection with Mr. Clark's non-Company business ventures and is a
stockholder, director and executive officer of Olive.
2
<PAGE>
Enrique F. Senior
Director since: 1987
Age: 54
Since November 1982, Mr. Senior has been a Managing Director of Allen &
Company Incorporated, an investment banking firm. For a number of years prior
to November 1982, Mr. Senior was a Vice President of Allen & Company
Incorporated.
Lewis Klein
Director since: 1987
Age: 70
From 1985 to 1993, Mr. Klein was President of Gateway Communications, Inc.
("Gateway"), a company which owns and operates several television stations.
From 1972 to 1985, Mr. Klein served as Executive Vice President of Gateway,
and he has been a director of Gateway since 1975. Mr. Klein is the founder and
past president of the International Association of Television Program
Executives and is currently President of its Educational Foundation. Since
1952, Mr. Klein has been a professor at the Temple University School of
Communications.
Jeffrey B. Logsdon
Director since: 1996
Age: 45
Since August 1996, Jeffrey B. Logsdon has been a Managing Director of
Cruttenden Roth, Inc., an investment banking and brokerage firm, where he is
Director of Research. From July 1990 to August 1996, Mr. Logsdon was a
Managing Director of The Seidler Companies Incorporated, an investment banking
company, where he served as Director of Institutional Equities. In 1995, Mr.
Logsdon was named an All-Star Analyst by The Wall Street Journal for stocks in
the category of cable and broadcasting.
Robert A. Chuck
Director since: 1996
Age: 66
Robert A. Chuck became Vice President--Special Projects of the Company in
April 1993. He worked as a private consultant in the entertainment business
area from December 1992 to March 1993. From January 1990 to November 1992, Mr.
Chuck was Executive Vice President--Administration and Business Affairs of
Triad Artists, Inc., a leading full-service talent agency. He was Executive
Vice President and General Counsel of International Creative Management, Inc.,
another leading full-service talent agency, from 1978 through 1989. Overall,
Mr. Chuck has held various business positions in the entertainment industry
for over 30 years.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR EACH OF THE
NOMINEES TO SERVE AS DIRECTORS UNTIL THE NEXT ANNUAL MEETING AND UNTIL THEIR
SUCCESSORS HAVE BEEN ELECTED AND QUALIFIED.
COMMITTEES
The Board of Directors has an Audit Committee but does not have a Nominating
Committee or Compensation Committee. The Audit Committee's functions are to
recommend the appointment of independent accountants, review the arrangements
for and scope of the audit by the independent accountants, review and monitor
the Company's policies regarding business ethics and conflicts of interest and
discuss with management and the independent accountants annual financial
statements and key accounting and reporting matters. The Audit Committee is
currently composed of Messrs. Klein and Senior. The Audit Committee did not
meet during fiscal 1997.
DIRECTORS' REMUNERATION
Non-employee directors receive an annual fee of $10,000 plus reimbursements
of expenses incurred in connection with attendance at Board of Directors'
meetings.
The Board of Directors met twice during fiscal 1997.
3
<PAGE>
PRINCIPAL STOCKHOLDERS
The following tables set forth information concerning the shares of Common
Stock and Class A Common Stock beneficially owned as of September 19, 1997 by
each stockholder known to the Company to own beneficially more than 5% of the
outstanding shares of either class of its common stock and by each director,
each nominee for director, certain officers and by all officers, directors and
nominees for director as a group.
COMMON STOCK
<TABLE>
<CAPTION>
PERCENTAGE
NAME AND ADDRESS NUMBER OF SHARES OF CLASS
OF BENEFICIAL OWNER BENEFICIALLY OWNED(1)(2) OUTSTANDING
------------------- ------------------------ -----------
<S> <C> <C>
Richard W. Clark(3)..................... 5,653,400(4) 74.08%
Karen W. Clark(3)....................... 2,965,500 38.86%
Francis C. La Maina(3).................. 749,950(5) 9.83%
Kenneth H. Ferguson(3).................. 7,500(6) *
Robert A. Chuck(3)...................... 0 *
William S. Simon(3)..................... 0 *
Lewis Klein............................. 1,500 *
1475 Hampton Road
Rydal, Pennsylvania 19046
Jeffrey B. Logsdon...................... 1 *
13801 Von Karman, Suite 700
Irvine, California 92715
Enrique F. Senior....................... 0 *
711 Fifth Avenue
New York, New York 10022
All officers, directors and nominees for
director as a group (nine persons)..... 6,412,351(7) 84.02%
</TABLE>
CLASS A COMMON STOCK
<TABLE>
<CAPTION>
PERCENTAGE
NAME AND ADDRESS NUMBER OF SHARES OF CLASS
OF BENEFICIAL OWNER BENEFICIALLY OWNED(1) OUTSTANDING
------------------- --------------------- -----------
<S> <C> <C>
Richard W. Clark(3).......................... 675,000 90%
Francis C. La Maina(3)....................... 75,000 10%
All officers, directors and nominees for di-
rector as a group (nine persons)............ 750,000 100%
</TABLE>
- --------
*Less than 1%
(1) With the exception of Ms. Clark, and except where otherwise indicated, all
parties listed below have sole voting and investment power over the shares
beneficially owned by them. Pursuant to a voting trust agreement between
Mr. Clark and Ms. Clark, Mr. Clark has the sole voting power over the
shares owned by Ms. Clark.
(2) Does not include shares of Common Stock issuable upon conversion of Class
A Common Stock.
(3) The business address of each of these individuals is 3003 West Olive
Avenue, Burbank, California 91510-7811.
(4) Includes 2,965,500 shares owned by Ms. Clark and 357,400 shares owned by
Olive.
(5) Includes 500 shares owned by Mr. La Maina's wife and options to purchase
165,450 shares of Common Stock which are currently exercisable.
(6) Includes options to purchase 7,500 shares of Common Stock which are
currently exercisable.
(7) Includes 172,950 shares of Common Stock subject to options which are
currently exercisable and which may be exercised by certain officers
within 60 days under the Company's 1987 Employee Stock Option Plan.
4
<PAGE>
Pursuant to an agreement between Messrs. Clark and La Maina, Messrs. Clark
and La Maina have rights of the first refusal to purchase each other's shares
of Common Stock and Class A Common Stock in the event either wishes to sell
his shares to a third party (other than a spouse or lineal descendant) or in a
market transaction. A purchase by Mr. La Maina of shares held by Mr. Clark
could result in a change of control of the Company. Pursuant to an agreement
among Messrs. Clark, La Maina and Ms. Clark, Mr. Clark has rights of first
refusal in the event Ms. Clark wishes to sell her shares to a third party or
in a market transaction and a right of purchase in the event of her death, and
Mr. La Maina has identical rights in the event Mr. Clark does not exercise his
rights with respect to Ms. Clark's shares.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who beneficially own more than
10% of the Company's Common Stock, to file initial reports of ownership and
reports of changes in ownership with the Securities and Exchange Commission
("SEC"). Executive officers, directors, and greater than 10% beneficial owners
are required by SEC regulations to furnish the Company with copies of all
Section 16(a) forms they file.
Based solely on a review of the copies of such forms furnished to the
Company and written representations from the Company's executive officers and
directors, the Company believes that during fiscal 1997 all Section 16(a)
filing requirements applicable to its executive officers, directors, and
greater than 10% beneficial owners were complied with.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table contains information about the compensation paid by the
Company for services rendered in all capacities during the three years ended
June 30, 1997, to the Chief Executive Officer of the Company and each of the
most highly paid executive officers of the Company whose compensation
exceeds $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
------------
ANNUAL OPTIONS
COMPENSATION GRANTED
------------------ ------------
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS($)
--------------------------- ---- --------- -------- ------------
<S> <C> <C> <C> <C>
Richard W. Clark....................... 1997 950,000 543,778(3) --
Chairman of the Board and 1996 950,000 494,282(2) --
Chief Executive Officer 1995 950,000 -- --
Francis C. La Maina.................... 1997 531,313 379,185(3) --
President and Chief 1996 525,000 345,711(2) --
Operating Officer 1995 518,000 -- --
Kenneth H. Ferguson.................... 1997 152,761 -- --
Vice President of Finance and 1996 150,000 30,000(2) --
Chief Financial Officer 1995 150,000 26,000(1) 7,500
</TABLE>
- --------
(1) Represents bonus compensation earned with respect to fiscal 1995, which
was paid during fiscal 1996.
(2) Represents bonus compensation earned with respect to fiscal 1996, which
was paid during fiscal 1997.
(3) Represents bonus compensation earned with respect to fiscal 1997, which
will be paid during fiscal 1998.
5
<PAGE>
EMPLOYMENT AGREEMENTS
The Company and Mr. Clark are parties to an Employment Agreement dated as of
July 1, 1997, pursuant to which Mr. Clark serves as Chairman and Chief
Executive Officer of the Company. The Employment Agreement provides for a five
(5) year term commencing on July 1, 1997 and expiring on June 30, 2002, unless
earlier terminated by the Company or Mr. Clark to the extent permitted by the
Employment Agreement. The Employment Agreement also provides that the term
thereof will be extended for an additional one year, each year, unless sixty
(60) days prior to the end of the then current year (April 1), the Company
notifies Mr. Clark that it does not desire the employment term to extend for
an additional one year. The Employment Agreement provides for a base salary of
$975,000 and a bonus payable upon the Company's achievement of Pre-tax Profits
above $7,000,000 per annum. Mr. Clark's prior Employment Agreement with the
Company provided for an annual base salary of $950,000 and the same bonus
formula. Under Mr. Clark's prior Employment Agreement, bonuses of $494,282 and
$543,778 were earned by Mr. Clark for fiscal 1996 and fiscal 1997,
respectively. The Employment Agreement also provides for various payments to
Mr. Clark should the Company terminate Mr. Clark's employment with the
Company, other than for Cause (as that term is defined in the Employment
Agreement) or materially reduces Mr. Clark's responsibilities.
Mr. La Maina serves as President and Chief Operating Officer of the Company
pursuant to an Employment Agreement dated as of July 1, 1997, which provides
for a five (5) year term commencing on July 1, 1997 and expiring on June 30,
2002, unless earlier terminated by the Company or Mr. La Maina to the extent
permitted in the Employment Agreement. The Employment Agreement also provides
that the term thereof will be extended for an additional one year, each year,
unless sixty (60) days prior to the end of the then current year (April 1),
the Company notifies Mr. La Maina that it does not desire the employment term
to extend for an additional one year. The Employment Agreement provides for a
base salary of $525,000 (which was also the amount of Mr. La Maina's base
salary in his prior Employment Agreement) plus an annual adjustment, if
applicable, based upon the percentage increase in the consumer price index for
Los Angeles, California for the relevant twelve (12) month period. Based on
the Company's Pre-tax Profits above $7,000,000 for a fiscal year, Mr. La Maina
is entitled to receive a bonus payment. Pursuant to the same bonus formula in
Mr. La Maina's prior Employment Agreement, bonuses of $345,711 and $379,185
were earned by Mr. La Maina for fiscal 1996 and fiscal 1997, respectively. The
Employment Agreement also provides for various payments to Mr. La Maina should
the Company terminate Mr. La Maina's employment with the Company, other than
for Cause (as that term is defined in the Employment Agreement) or materially
reduces Mr. La Maina's responsibilities or should Mr. La Maina terminate his
employment upon a Change of Control (as such term is defined in the Employment
Agreement). Mr. La Maina was also granted an option on September 1, 1992 to
acquire up to 225,450 shares of the Company's Common Stock in accordance with
the Company's 1987 Employee Stock Option Plan. At present, all unexercised
options are fully exercisable.
Mr. Ferguson is employed as the Company's Vice President of Finance, and
Chief Financial Officer, pursuant to an employment agreement commencing on
July 1, 1997 and expiring on June 30, 1998. Mr. Ferguson's base salary is
$150,000, subject to annual adjustments in the base amount for any cost of
living increase or decrease (but which base salary amount may not be decreased
to an amount below $150,000). In addition, he is entitled to receive bonus
compensation in an amount determined by the Company, in its sole and absolute
discretion, but in no event to exceed 50% of his annual base salary for the
fiscal year to which such bonus applies. Based upon similar provisions in Mr.
Ferguson's prior employment agreement, Mr. Ferguson was awarded bonuses of
$30,000 and $26,000 with respect to fiscal 1996 and 1995, respectively. Mr.
Ferguson may be awarded a bonus with respect to fiscal 1997, but the
determination of any such award has not yet been made by the Company.
6
<PAGE>
STOCK OPTIONS
The following table sets forth information with respect to the exercise of
stock options during fiscal 1997 and the options held as of June 30, 1997 by
each of the named executives.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS IN-THE-MONEY OPTIONS
AT FISCAL YEAR-END (#) AT FISCAL YEAR-END ($)(1)
------------------------- -------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Francis C. La Maina......... 165,450 0 $1,715,717 0
Kenneth H. Ferguson......... 7,500 0 $ 43,125 0
</TABLE>
- --------
(1) Represents the difference between the closing market price of the Common
Stock at June 30, 1997 ($13.25 per share) and the exercise price ($3.88
per share for Mr. La Maina and $7.50 per share for Mr. Ferguson) of the
options.
BOARD REPORT
The report of the Board of Directors shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent that the Company
specifically incorporates this information by reference, and shall not
otherwise be deemed filed under such Acts.
The principal objectives of the Company's compensation program are to
attract and retain qualified executives, to compensate for experience and
goodwill, and to provide incentives for executives to enhance the
profitability and growth of the Company and thus enhance shareholder value.
During the fiscal year ended June 30, 1997, the Company's executive
compensation program was administered by the Board of Directors. The executive
compensation program consists principally of base salaries, performance
bonuses and stock options.
The following describes components of the Company's executive compensation
program and the related factors considered by the Board in determining
compensation.
Base Salaries. Base salaries are determined after evaluating a number of
factors, including market conditions, job performance and amounts paid to
executives with comparable experience, qualifications and responsibilities.
The Board also intends that salaries be comparable to those paid for similar
positions in other companies of similar size and performance. The length of
service to the Company, experience within the industry, and the goodwill
associated with their names are significant factors involved in the
compensation of the Company's two highest executive officers.
Performance Bonuses. Certain executives receive bonuses based upon the
Company's achievement of specified financial targets. Such bonuses are
intended to ensure that these employees have a continuing interest in the
success of the Company.
Discretionary Bonus. Certain executives receive bonuses based upon such
criteria as the President and Chief Operating Officer of the Company in his
sole and absolute discretion determines appropriate.
Stock Options. The Company, through its Stock Option Committee and subject
to the 1987 Employee Stock Option Plan and the 1996 Stock Option Plan, awards
certain executives incentive stock options which generally vest over a number
of years. The number of shares of Common Stock subject to an executive's stock
option
7
<PAGE>
grant is determined with reference to the responsibility and experience of the
executive and competitive conditions. By aligning the financial interests of
the Company's executives with those of the Company's stockholders, these
option awards are intended to be directly related to the creation of value for
stockholders of the Company. The deferred vesting provisions are designed to
create an incentive for the individual executive to remain with the Company.
Benefits. The Company offers basic benefits, such as medical, life and
disability insurance comparable to those provided by similar companies.
BOARD OF DIRECTORS
Richard W. Clark
Karen W. Clark
Francis C. La Maina
Lewis Klein
Enrique F. Senior
Jeffrey B. Logsdon
Robert A. Chuck
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Clark and La Maina and Ms. Clark, each of whom is a director and an
officer of the Company, participated in discussions regarding compensation of
executive officers. Each of the aforementioned individuals excused himself or
herself from any deliberations regarding his or her own compensation during
fiscal 1997.
Messrs. Clark and La Maina are each stockholders, directors and executive
officers of Olive, a company controlled by Mr. Clark. Messrs. Clark and La
Maina participated in deliberations regarding compensation of Olive's
executive officers.
During fiscal 1997, the Company provided management, consulting and office
services to Olive and other companies owned by the Company's principal
stockholders. The net amount paid by Olive and the other companies during
fiscal 1997 for such services was $112,000 and $39,000, respectively. The
Company believes that the terms of the foregoing transactions were no less
favorable to the Company than could have been obtained from unaffiliated third
parties on an arms-length basis.
Since 1986, the Company has licensed from Olive the right to use the
American Bandstand(R) trademark and variations thereof (the "Mark") in
connection with the business of the Company and its subsidiaries, pursuant to
a long-term license agreement, without the payment of any license fee or other
consideration to Olive. The Company and Olive have extended the term of the
license agreement until December 31, 1997, pending completion of a transaction
in which Olive will assign all of its right, title and interest in the Mark to
the Company. Olive also loans to the Company, without charge, certain
memorabilia which the Company currently uses in The American Bandstand(TM)
Grill restaurants and the American Bandstand Dance Club located in Reno,
Nevada.
8
<PAGE>
PERFORMANCE GRAPH
The Performance Graph below shall not be deemed incorporated by reference by
any general statement incorporating by reference this proxy statement into any
filing under the Securities Act of 1933 or under the Securities Exchange Act
of 1934, except to the extent the Company specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.
The following graph shows a five-year comparison for the period from July 1,
1992 to June 30, 1997 of cumulative total stockholder return (including the
reinvestment of any dividends) of $100 invested in (i) the Company, (ii) an
index of peer companies selected by the Company, and (iii) the NASDAQ Market
Index.
STOCK PRICE PERFORMANCE
COMPARISON OF 5 YEAR CUMULATIVE RETURN
<TABLE>
<CAPTION>
Measurement Period
(Fiscal Year Covered) DCPI PEER INDEX NASDAQ
- --------------------- ---------- ---------- ----------
<S> <C> <C> <C>
Measurement Pt- 1993 $100 $100 $100
FYE 1994 $225 $107.41 $100.29
FYE 1995 $218.75 $109.75 $130.01
FYE 1996 $356.25 $121.52 $157.74
FYE 1997 $331.25 $ 81.89 $168.01
</TABLE>
The Company chose its peer group by selecting entertainment companies other
than motion picture companies with revenues under $100 million and stock
prices for two years or more. The peer index includes J2 Communications,
Kushner-Locke Company, Matthews Studio Equipment Group, Rentrak Corporation,
Todd-AO Corporation, Showscan Corporation, Lancit Media Entertainment, and
Unitel Video. The peer group index included in this graph reflects the
omission of Venture Entertainment Group, Ltd., which is now listed on the
NASDAQ pink sheets. Due to the unique composition and nature of the Company's
businesses, the Company believes that the peer group index may not provide a
meaningful comparison to comparable businesses.
9
<PAGE>
CERTAIN TRANSACTIONS
The Company is a tenant under a triple net lease (the "Lease") with Olive,
covering the premises occupied by the Company in Burbank, California. The
Lease provides for a term ending on December 31, 2000 at a per annum rent of
$516,000 payable monthly commencing September 1, 1989, with adjustments based
on the Consumer Price Index every 24 months. In fiscal 1997, the Company paid
$616,000 under this lease agreement.
The Company subleases a portion of the space covered by the Lease to Olive
and to third parties owned by Messrs. Clark and La Maina on a month-to-month
basis. The Company also pays Olive for certain storage services at a warehouse
owned by Olive, for which the Company paid Olive $156,000 in fiscal 1997. The
Company believes that the terms of the Lease, the subleases to Olive and to
third parties and the warehouse services arrangement are no less favorable to
the Company than could have been obtained from unaffiliated third parties on
an arms-length basis.
Mr. Clark is actively involved in the Company's television programming and
many of the programs involve the executive producing services and creative
talent of Mr. Clark. Mr. Clark's services are not exclusive to the Company.
The Company pays Mr. Clark for his services as a performer on Company
programs and for any use of his name and likeness in connection with
activities outside the television and motion picture business. Compensation
paid by the Company to Mr. Clark as a performer or for such use of his name
and likeness is based on industry standards for performers of his stature. In
fiscal 1997, 1996 and 1995 the Company paid Mr. Clark $435,000, $735,000 and
$267,000 respectively, for his services as a performer on Company programs.
See "Compensation Committee Interlocks and Insider Participation" for
descriptions of certain business arrangements between the Company and Olive.
PROPOSAL 2.
PROPOSAL TO APPROVE BONUS AWARDS UNDER EMPLOYMENT
AGREEMENTS FOR MR. CLARK AND MR. LA MAINA
GENERAL
The Board of Directors of the Company, including all of the Company's
independent and unaffiliated Directors, has approved new Employment Agreements
for Messrs. Clark and La Maina which have an initial five (5) year term
commencing on July 1, 1997 and expiring on June 30, 2002. The Employment
Agreements are intended to secure the continued long-term services of Messrs.
Clark and La Maina, by, among other things, providing that the term of each
Employment Agreement is automatically extended each year, for an additional
period of one year, should the Company not notify the executive prior to April
1 of the then current year that the Company does not intend for the employment
term to be extended.
Mr. Clark's Employment Agreement provides for annual base compensation of
$975,000 per annum, and Mr. La Maina's Employment Agreement provides for
annual base compensation of $525,000 per annum. Each of the Employment
Agreements also provides for an annual bonus award (the "Bonus Award") based
upon the Company's Pre-tax Profits (as defined in the Employment Agreements)
during each fiscal year; provided Pre-tax Profits exceed $7,000,000.
Although the Bonus Award provisions of the Employment Agreements are the
same as are those contained in Mr. Clark's and Mr. La Maina's prior Employment
Agreements, the Bonus Award provisions in the new Employment Agreements are
being submitted for shareholder approval at the Annual Meeting in order for
the Company to be able to continue to obtain the full tax deductibility of any
payment of the Bonus Awards, as "qualified performance-based compensation"
under Section 162(m) of the Internal Revenue Code of 1986, as amended, and the
regulations thereunder (collectively, "Section 162(m)"). The shareholders are
not being requested to vote on, or approve, any other provision of the
Employment Agreements. If the Bonus Awards are
10
<PAGE>
not approved by shareholders, no payment will be made under such provision and
the balance of the Employment Agreement will continue without the Bonus Award
provision. Mr. Clark and Mr. La Maina presently own a sufficient number of
shares of Common Stock and Class A Common Stock to approve the Bonus Awards.
Section 162(m) precludes a public corporation from deducting in any tax year
compensation in excess of $1,000,000 for its chief executive officer or any of
its four other highest-paid officers. However, certain "performance-based"
compensation is specifically excluded from the deduction limit. To qualify,
the compensation must be based solely on attaining a preestablished, objective
performance goal, provided such goal is determined by a compensation committee
of the Board of Directors of the Company which is comprised solely of two or
more outside directors (within the meaning of Section 162(m)), the material
terms under which the compensation is to be paid is disclosed to and approved
by the shareholders, and before such compensation is paid, the compensation
committee referred to above certifies that the performance goals and other
material terms have been met. Although enacted on 1993, Section 162(m) first
applies to payments under the Employment Agreements for fiscal 1998.
THE BONUS AWARDS
The Bonus Awards are designed to provide incentives for the Company's two
principal executives to manage the Company to maximize Pre-tax Profits for all
shareholders. Mr. Clark has served as the Company's Chairman and Chief
Executive Officer and Mr. La Maina has served as the Company's Chief Operating
Officer since the Company completed the initial public offering of its Common
Stock in 1987. The Employment Agreements define "Pre-tax Profits" of the
Company for any fiscal year as the consolidated net income before taxes of the
Company and its subsidiaries as shown on the audited consolidated statement of
profit and loss of the Company and its subsidiaries for that fiscal year,
without giving effect to accruals for the Bonus Award, if any, payable for
such fiscal year to Mr. Clark and Mr. La Maina. The Bonus Awards will be
payable only if such provisions are approved by a majority of the votes cast
with respect thereto at the Annual Meeting, and the performance goals are met.
Mr. Clark's Employment Agreement provides for a Bonus Award payment equal to
the following amounts with respect to the Pre-tax Profits of the Company, if
any, during a particular fiscal year:
<TABLE>
<CAPTION>
IF PRETAX PROFITS ARE:
----------------------
OVERBUT NOT OVER PAYMENT
---------------------- -------
<C> <S>
0 - $ 7,000,000.... 0
$ 7,000,000 - $10,000,000... $380,000 + 4% of Pre-tax Profits over $ 7,000,000
$10,000,000 - $15,000,000... $500,000 + 3% of Pre-tax Profits over $10,000,000
$15,000,000................. $650,000 + 2% of Pre-tax Profits over $15,000,000
</TABLE>
Mr. La Maina's Employment Agreement provides for a Bonus Award payment equal
to the following amounts with respect to the Pre-tax Profits of the Company,
if any, during a particular fiscal year:
<TABLE>
<CAPTION>
IF PRETAX PROFITS ARE:
----------------------
OVERBUT NOT OVER PAYMENT
---------------------- -------
<C> <S>
0 - $ 7,000,000.... 0
$ 7,000,000 - $10,000,000... $260,000 + 3% of Pre-tax Profits over $ 7,000,000
$10,000,000 - $15,000,000... $350,000 + 2% of Pre-tax Profits over $10,000,000
$15,000,000................. $450,000 + 1% of Pre-tax Profits over $15,000,000
</TABLE>
11
<PAGE>
ADMINISTRATION
The Bonus Award provision of the Employment Agreements were timely approved
by a committee of the Board of Directors consisting solely of outside
directors (within the meaning of Section 162(m)), as well as the full Board.
Prior to payment of any Bonus Award, such committee directors will review the
calculation of Pre-tax Profit based on the audited financial statement of the
Company for the fiscal year and certify to the Board of Directors of the Bonus
Awards. Bonus Awards earned will then be paid to the recipient within thirty
(30) days after the Company's receipt from its independent public accountants
of the Company's audited financial statements for the applicable fiscal year.
FEDERAL INCOME TAX TREATMENT
Based on the Company's interpretation of Section 162(m), the Company
believes that, subject to a favorable shareholder vote, the Bonus Awards will
be deductible by the Company. Bonus Awards paid, if any, will be taxable as
ordinary income to the recipient in the year received and will be subject to
applicable withholding.
PRIOR BONUS PAYMENTS
See "Executive Compensation and Other Information--Employment Agreements"
for information concerning bonuses awarded to Messrs. Clark and La Maina with
respect to fiscal 1997 based upon the same formula as the Bonus Awards
contained in the Employment Agreements.
THEREFORE, THE BOARD OF DIRECTORS OF THE COMPANY HEREBY RECOMMENDS THAT THE
SHAREHOLDERS VOTE IN FAVOR OF THE FOLLOWING RESOLUTION:
RESOLVED, that the Bonus Award provision set forth in the Employment
Agreement dated as of July 1, 1997 between the Company and Mr. Clark
and the Employment Agreement dated as of July 1, 1997 between the
Company and Mr. La Maina are approved.
PROPOSAL 3.
APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors of the Company has appointed Arthur Andersen LLP as
the Company's independent accountants for fiscal 1998.
Representatives of Arthur Andersen LLP will be present at the Annual Meeting
to respond to appropriate questions and to make such statements as they may
desire.
Ratification of the appointment of Arthur Andersen LLP as the Company's
independent accountants for fiscal 1998 will require the affirmative vote of
at least a majority of the votes of the shares of Common Stock and Class A
Common Stock represented in person or by proxy and entitled to vote at the
Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR
RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE COMPANY'S
INDEPENDENT ACCOUNTANTS FOR FISCAL 1998.
ALL OTHER MATTERS WHICH MAY COME BEFORE THE ANNUAL MEETING
As of the date of this Proxy Statement, the Company knows of no business
that will be presented for consideration at the Annual Meeting other than that
which has been referred to above. As to other business, if any, that may come
before the Annual Meeting, it is intended that proxies in the enclosed form
will be voted in accordance with the judgment of the proxy holder.
12
<PAGE>
STOCKHOLDER PROPOSALS FOR THE NEXT ANNUAL MEETING
Any proposal of a stockholder intended to be presented at the Company's 1998
Annual Meeting of Stockholders must be received by the Secretary of the
Company, for inclusion in the notice of meeting and proxy statement relating
to the 1998 Annual Meeting, by August 1, 1998.
ADDITIONAL INFORMATION
The cost of soliciting proxies in the enclosed form will be borne by the
Company. Officers and regular employees of the Company may, but without
compensation other than their regular compensation, solicit proxies by further
mailing, personal conversations, or by telephone or telegraph. The Company
will, upon request, reimburse brokerage firms and others for their reasonable
expenses in forwarding solicitation material to the beneficial owners of its
Common Stock.
By order of the Board of Directors
/s/ Martin Eric Weisberg
Martin Eric Weisberg
Secretary
September 30, 1997
13
<PAGE>
LOGO
PROXY PROXY
DICK CLARK PRODUCTIONS, INC.
(SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS)
The undersigned holder of Common Stock of dick clark productions, inc.,
revoking all proxies heretofore given, hereby constitutes and appoints Francis
C. La Maina and Martin Eric Weisberg and each of them, Proxies, with full power
of substitution, for the undersigned and in the name, place and stead of the
undersigned, to vote all of the undersigned's shares of said stock, according
to the number of votes and with all the powers the undersigned would possess if
personally present, at the Annual Meeting of Stockholders of dick clark
productions, inc., to be held at The Penn Club, 30 West 44th Street, 10th
Floor, Banquet Room, New York, New York on Tuesday, November 4, 1997, at 11:30
A.M., and at any adjournments or postponements thereof.
The undersigned hereby acknowledges receipt of the Notice of Meeting and
Proxy Statement relating to the meeting and hereby revokes any proxy or proxies
heretofore given.
Each properly executed Proxy will be voted in accordance with the
specifications made on the reverse side of this Proxy and in the discretion of
the Proxies on any other matter that may properly come before the meeting.
Where no choice is specified, this Proxy will be voted FOR all listed nominees
to serve as directors and FOR Proposals 2, 3 and 4.
PLEASE MARK, DATE AND SIGN THIS PROXY ON THE REVERSE SIDE
<PAGE>
LOGO
PLEASE MARK YOUR CHOICE LIKE THIS IN BLUE OR BLACK INK: [X]
(1) Election of seven Directors
[_] FOR ALL NOMINEES LISTED (except as marked to the contrary)
[_] WITHHOLD AUTHORITY to vote for all listed
nominees below
Nominees: Richard W. Clark, Karen W. Clark,
Francis C. La Maina, Robert A. Chuck, Lewis Klein, Jeffrey B. Logsdon and
Enrique F. Senior.
(INSTRUCTION: To withhold authority to vote for any individual nominee, circle
that nominee's name in the list provided above.)
(2) Proposal to approve Bonus Awards under Employment Agreements for Mr. Clark
and Mr. La Maina.
[_] FOR [_] AGAINST [_] ABSTAIN
(3) Proposal for appointment of Arthur Andersen LLP as the Company's auditors
for the 1998 fiscal year.
[_] FOR [_] AGAINST [_] ABSTAIN
(4) In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL LISTED NOMINEES AND FOR
PROPOSALS 2 AND 3.
I PLAN TO ATTEND THE MEETING [_]
-------------- Dated _________________________ , 1997
ACCOUNT NUMBER --------------------------------------
- ----------- --------------------------------------
COMMON Signature(s)
(SIGNATURES SHOULD CONFORM TO NAMES
AS REGISTERED. FOR JOINTLY OWNED
SHARES, EACH OWNER SHOULD SIGN. WHEN
SIGNING AS ATTORNEY, EXECUTOR,
ADMINISTRATOR, TRUSTEE, GUARDIAN OR
OFFICER OF A CORPORATION, PLEASE GIVE
FULL TITLE.)
PLEASE MARK AND SIGN ABOVE AND RETURN PROMPTLY
<PAGE>
- -------
PROXY PROXY
DICK CLARK PRODUCTIONS, INC.
(SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS)
The undersigned holder of Common Stock of dick clark productions, inc.,
revoking all proxies heretofore given, hereby constitutes and appoints Francis
C. La Maina and Martin Eric Weisberg and each of them, Proxies, with full
power of substitution, for the undersigned and in the name, place and stead of
the undersigned, to vote all of the undersigned's shares of said stock,
according to the number of votes and with all the powers the undersigned would
possess if personally present, at the Annual Meeting of Stockholders of dick
clark productions, inc., to be held at The Penn Club, 30 West 44th Street,
10th Floor, Banquet Room, New York, New York on Tuesday, November 4, 1997, at
11:30 A.M., and at any adjournments or postponements thereof.
The undersigned hereby acknowledges receipt of the Notice of Meeting and
Proxy Statement relating to the meeting and hereby revokes any proxy or
proxies heretofore given.
Each properly executed Proxy will be voted in accordance with the
specifications made on the reverse side of this Proxy and in the discretion of
the Proxies on any other matter that may properly come before the meeting.
Where no choice is specified, this Proxy will be voted FOR all listed nominees
to serve as directors and FOR Proposals 2, 3 and 4.
PLEASE MARK, DATE AND SIGN THIS PROXY ON THE REVERSE SIDE
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL LISTED NOMINEES AND FOR
PROPOSALS 2 AND 3.
PLEASE MARK [X]
YOUR CHOICE LIKE
THIS IN BLUE OR
BLACK INK:
FOR ALL WITHHOLD
NOMINEES LISTED AUTHORITY TO
(EXCEPT AS VOTE FOR ALL
MARKED TO THE LISTED NOMINEES
CONTRARY) BELOW
1. ELECTION OF SEVEN DIRECTORS [_] [_]
Nominees:
Richard W. Clark Lewis Klein
Karen W. Clark Jeffrey B. Logsdon
Francis C. La Maina Enrique F. Senior
Robert A. Chuck
(INSTRUCTION: To withhold authority to vote for any individual nominee, circle
that nominee's name in the list provided above.)
FOR AGAINST ABSTAIN
2. Proposal to approve Bonus Awards [_] [_] [_]
under Employment Agreements for
Mr. Clark and Mr. La Maina.
FOR AGAINST ABSTAIN
3. Proposal for appointment of Arthur [_] [_] [_]
Andersen LLP as the Company's
auditors for the 1997 fiscal year.
4. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting.
I PLAN TO ATTEND THE MEETING [_]
Dated____________________________, 1997
_______________________________________
_______________________________________
Signature(s)
(Signatures should conform to names as
registered. For jointly owned shares,
each owner should sign. When signing as
attorney, executor, administrator,
trustee, guardian or officer of a
corporation, please give full title.)
PLEASE MARK AND SIGN ABOVE AND RETURN PROMPTLY
