<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a Party other than the Registrant /X/
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 Section240.14a-11(c) or
Section240.14a-12
NU-KOTE HOLDING, 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:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[Nu-kote Letterhead]
August 22, 1997
Dear Stockholders:
You are cordially invited to attend the 1997 Annual Meeting of Stockholders
of Nu-kote Holding, Inc. to be held at the Stonebriar Country Club, 5050 Country
Club Drive, Frisco, Texas, 75034, on Wednesday, September 25, 1997, at 9:00
a.m., Central Time.
At the meeting, stockholders will be asked to elect six directors for the
ensuing year, to ratify the selection of Coopers & Lybrand L.L.P. as the
Company's independent auditors for fiscal 1998, and to transact such other
business as may properly come before the meeting. A proxy card on which to
indicate your votes and an envelope, postage prepaid, in which to return your
proxy are enclosed.
While we would like to have each of you attend the meeting and vote your
shares in person, we realize this may not be possible. However, whether or not
you plan to attend the meeting, your vote is important. WE URGE YOU TO COMPLETE,
SIGN AND RETURN THE ENCLOSED PROXY SO THAT YOUR SHARES WILL BE REPRESENTED. If
you decide later to attend the meeting, you may revoke your proxy at that time
and vote your shares in person. By promptly returning the enclosed proxy, you
help the Company avoid the necessity and expense of sending follow-up letters to
assure the attendance of a quorum at the meeting.
If you desire any additional information concerning the meeting or the
matters proposed for action at the meeting, we would be glad to hear from you.
Sincerely,
[SIG]
David F. Brigante
Chairman of the Board
<PAGE>
NU-KOTE HOLDING, INC.
17950 PRESTON ROAD, SUITE 690
DALLAS, TEXAS 75252
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD SEPTEMBER 25, 1997
------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Nu-kote
Holding, Inc. will be held at the Stonebriar Country Club, 5050 Country Club
Drive, Frisco, Texas 75034, on Thursday, September 25, 1997, at 9:00 a.m.,
Central Time, for the following purposes:
1. To elect six directors to serve for the ensuing year;
2. To ratify the appointment of Coopers & Lybrand L.L.P. as independent
auditors for fiscal 1998; and
3. To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
The close of business on Friday, August 22, 1997, has been fixed by the
Board of Directors as the record date for determining stockholders entitled to
notice of and to vote at the Annual Meeting. A list of stockholders eligible to
vote at the Annual Meeting will be available for inspection at the Annual
Meeting and during business hours from September 11, 1997 to the date of the
Annual Meeting at the Company's headquarters at the address set forth above.
You are cordially invited to attend the Annual Meeting. Whether or not you
plan to attend the Annual Meeting, you may ensure your representation by
completing, signing, dating and promptly returning the enclosed form of proxy. A
return envelope, which requires no postage if mailed in the United States, has
been provided for your use. If you attend the Annual Meeting and inform the
Secretary of Nu-kote Holding, Inc. in writing that you wish to vote your shares
in person, your proxy will not be used.
By Order of the Board of Directors,
ANTHONY G. SCHMECK
SECRETARY
August 22, 1997
<PAGE>
NU-KOTE HOLDING, INC.
17950 PRESTON ROAD, SUITE 690
DALLAS, TEXAS 75252
------------------------
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
------------------------
THURSDAY, SEPTEMBER 25, 1997
ANNUAL MEETING AND PROXY SOLICITATION INFORMATION
This Proxy Statement is furnished in connection with the solicitation on
behalf of the Board of Directors (the "Board") of Nu-kote Holding, Inc. (the
"Company") of proxies for use at the Annual Meeting of Stockholders (the "Annual
Meeting") to be held at the Stonebriar Country Club, 5050 Country Club Drive,
Frisco, Texas 75034, on Thursday, September 25, 1997, at 9:00 a.m., Central
Time, and at any adjournment thereof, for the purposes set forth in the
accompanying Notice of Annual Meeting of Stockholders.
This Proxy Statement, the accompanying form of proxy and the Company's 1997
Annual Report to Stockholders ("Annual Report") are first being mailed on or
about August 25, 1997, to all stockholders of the Company. Although the Annual
Report and this Proxy Statement are being mailed together, the Annual Report
shall not be deemed a part of this Proxy Statement.
Only holders of record of the Company's Class A Common Stock, par value $.01
per share ("Common Stock"), at the close of business on August 22, 1997, will be
entitled to vote at the Annual Meeting. As of that date, there were 21,775,302
shares of Common Stock outstanding. Each share of Common Stock entitles the
holder to one vote. A quorum for the Annual Meeting is a majority of the shares
of Common Stock outstanding. There is no cumulative voting and there are no
other voting securities of the Company outstanding.
If the accompanying form of proxy is properly signed and returned to the
Company prior to the Annual Meeting and not revoked, it will be voted in
accordance with the instructions contained therein. If no instructions are
given, the persons designated as proxies in the accompanying form of proxy will
vote "FOR" the election as directors of those persons named below and "FOR" all
other proposals set forth herein.
The Board is not currently aware of any matters, other than those referred
to herein, which will come before the Annual Meeting. If any other matter should
be presented at the Annual Meeting for action, the person named in the
accompanying proxy card will vote the proxy in their own discretion.
You may revoke your proxy at any time before it is actually voted at the
Annual Meeting by delivering written notice of revocation to the Secretary of
the Company, by submitting a subsequently dated proxy, or by attending the
Annual Meeting and voting in person. Attendance at the Annual Meeting will not,
in itself, constitute revocation of the proxy.
The expense of preparing, printing and mailing proxy materials to the
Company's stockholders will be borne by the Company. The Company has engaged
Chase Mellon Shareholder Services to assist in the solicitation of proxies from
stockholders at a fee of approximately $5,000, plus reimbursement of reasonable
out-of-pocket expenses. In addition, proxies may be solicited personally or by
telephone by officers or employees of the Company, none of whom will receive
additional compensation therefor. The
<PAGE>
Company will also reimburse brokerage houses and other nominees for their
reasonable expenses in forwarding proxy materials to beneficial owners of Common
Stock.
BOARD OF DIRECTORS
GENERAL INFORMATION
As set by the Board pursuant to the By-Laws of the Company, the authorized
number of directors to be elected to the Board is six. The directors will hold
office from the time of their election until the next annual meeting of
stockholders of the Company and until their successors are duly elected and
qualify, or until their earlier resignation or removal. Four of the nominees,
Messrs. Bolke, Brigante, Finn and Rochon were elected to the Board at the
Company's last annual meeting and all are currently serving as directors of the
Company.
MEETINGS OF THE BOARD
The Company's Board held twelve regularly scheduled or special meetings
during the fiscal year ended March 31, 1997 (the "Fiscal Year"). The Board has
four standing committees: an Executive Committee, an Audit Committee, a
Compensation and Benefits Committee and a Stock Option Committee.
Each current member of the Board nominated for election at the Annual
Meeting attended at least 75% of the total number of meetings of the Board and
of the Committees of the Board on which he served that were held during the
Fiscal Year.
COMPENSATION OF DIRECTORS
Directors who are also employees of the Company are not compensated for
services as directors. Non-employee directors of the Company receive $20,000 per
year, plus $2,000 per year per committee membership and $2,000 per year per
committee Chairmanship. In addition, under the Nu-kote Holding, Inc. 1992 Stock
Option Plan, as amended and restated (the "1992 Plan"), the Company provides
non-employee directors one-time grants of non-qualified stock options for 30,000
shares of Common Stock upon his or her initial election or appointment to the
Board. During the Fiscal Year, Mr. Howe was paid $150,000 as Vice Chairman of
the Board in lieu of directors' fees otherwise payable to him.
Under the terms of the Nu-Kote Holding, Inc. Deferred Stock Compensation
Plan (the "Deferred Stock Plan"), non-employee directors may elect to defer all
or a portion of that director's fees, including fees for attendance at regular
and special Board and committee meetings, for any calendar year (the "Deferred
Amount"). Each Deferred Amount is credited by the Company to a book keeping
account (the "Stock Account") and is converted into a stock equivalent (a "Stock
Equivalent") on the date the amount is credited. The number of Stock Equivalents
is based on the closing price of the Company's Common Stock. Distributions are
only made from a director's Stock Account upon termination of the director's
service through death, retirement or otherwise. For 1997, two of the Company's
directors, John P. Rochon and Brian D. Finn, are participating in the Deferred
Stock Plan.
COMMITTEES OF THE BOARD
EXECUTIVE COMMITTEE. The Executive Committee of the Board has authority,
with certain exceptions, to take all actions that may be taken by the full
Board. It may meet between regularly scheduled meetings
2
<PAGE>
to take such action as is necessary for the orderly conduct of the Company's
business. During the fiscal year, the Executive Committee held one meeting.
Messrs. Brigante, Howe and Dresdale are members of the Executive Committee.
AUDIT COMMITTEE. The Audit Committee of the Board reviews and approves the
scope and results of any outside audit of the Company, and the fees therefor,
and makes recommendations to the Board of Directors or management concerning
auditing and accounting matters and the selection of outside auditors. During
the Fiscal Year, the Audit Committee of the Board met two times. Messrs. Barry,
Bolke and Rochon are members of the Audit Committee.
COMPENSATION AND BENEFITS COMMITTEE. The Compensation and Benefits
Committee of the Board reviews, considers and acts (i) upon matters of salary
and other compensation and benefits (other than stock options and stock
appreciation rights) of all officers and other key employees of the Company,
(ii) upon all matters concerning the provisions of all Company benefit,
retirement or pension plans and (iii) exercises such authority as is delegated
to it under the provisions of the Company's benefit retirement and pension
plans. During the Fiscal Year, the Compensation and Benefits Committee of the
Board held two regular meetings and held special meetings or acted by unanimous
written consent two times. Messrs. Dresdale, Finn and Rochon are members of the
Compensation and Benefits Committee.
STOCK OPTION COMMITTEE. The Stock Option Committee of the Board was formed
on September 27, 1996 and is empowered to administer the Company's 1992 Plan,
Senior Management Stock Appreciation Rights Plan and such other employee benefit
plans, programs, policies and procedures as the Board may select. From inception
to the end of the Fiscal Year, the Stock Option Committee of the Board acted two
times by unanimous written consent. Messrs. Bolke and Rochon are members of the
Stock Option Committee.
DIRECTORS AND NOMINEES
The Board has no reason to believe that any of the nominees will not serve
if elected, but if any of them should become unavailable to serve as a director,
and if the Board designates a substitute nominee, the persons named in the
accompanying form of proxy will vote for the substitute nominee designated by
the Board.
CURRENT DIRECTORS. The following information with respect to other
principal occupation or employment and other affiliations and business
experience of each director during the last five years has been furnished to the
Company by such director. Except as otherwise indicated, each of the directors
has had the same principal occupation for the last five years.
DAVID F. BRIGANTE, AGE 45, CHAIRMAN OF THE BOARD SINCE 1994, DIRECTOR OF THE
COMPANY SINCE 1992
Mr. Brigante was elected Chairman of the Board in February 1994. He became
Chief Executive Officer of the Company in April 1993 and served in that capacity
until August 1997. Prior thereto, he served as President and Chief Operating
Officer of the Company from November 1992 and Executive Vice President and
General Manager-North American Supplies Group from 1991.
DONALD A. BOLKE, AGE 58, DIRECTOR OF THE COMPANY SINCE 1994
Mr. Bolke has been a director of the Company since November 1994. Mr. Bolke
served as Senior Vice President of Customer Relations of United Stationers, Inc.
from June 1992 until his retirement in
3
<PAGE>
December 1993. Prior thereto, Mr. Bolke served as Vice President of Stationers
Distributing Company from January 1990 until its acquisition by United
Stationers, Inc. in June 1992. Mr. Bolke first joined Zellerbach Office Products
in 1962, which was acquired in 1986 by Stationers Distributing Company, and at
which he held positions of increasing responsibility.
BRIAN D. FINN, AGE 36, DIRECTOR OF THE COMPANY SINCE 1993
Mr. Finn has been a director of the Company since November 1993. In June
1997 Mr. Finn became a principal with Clayton Dubilier & Rice, Inc. He was a
Managing Director of CS First Boston Corporation ("CS First Boston") from
January 1991 until June 1997. Mr. Finn was elected a Director of CS First Boston
in January 1990 and a Vice President of that company in 1989.
JOHN P. ROCHON, AGE 45, DIRECTOR OF THE COMPANY SINCE 1994
Mr. Rochon has been a director of the Company since 1994. Mr. Rochon has
been Chairman of the Richmont Corporation since 1990 and Chief Executive Officer
of Mary Kay Holding Corporation since 1991. Prior thereto, Mr. Rochon served in
positions of increasing responsibility with Mary Kay Holding Corporation,
including Vice Chairman from 1987 to 1991. Through Richmont Corporation and its
predecessor and affiliated companies, Mr. Rochon has built a large, diversified
portfolio of companies and investments strongly focused on consumer goods and
services. Mr. Rochon is also a director of Royal Appliance Manufacturing
Company.
HUBBARD C. HOWE, AGE 68, VICE CHAIRMAN OF THE BOARD SINCE 1994,
DIRECTOR OF THE COMPANY SINCE 1988
Mr. Howe has been a director of the Company since 1988, serving as Vice
Chairman from April 1991 to April 1992, Chairman of the Board from April 1992 to
February 1994 and Vice Chairman since February 1994. He was Chief Executive
Officer of the Company from March 1989 to April 1992. Mr. Howe has been a
professional employee of Clayton, Dubilier & Rice, ("Clayton, Dubilier & Rice")
since January 1991. He previously spent 12 years as an interim manager and
workout consultant. Mr. Howe is also Chairman and Chief Executive officer of
Remington Arms Co., Inc., Chairman of APS Holding Corporation and a director of
Homeland Holding Corporation and Riverwood Holding, Inc.
THEODORE BARRY, AGE 75, DIRECTOR OF THE COMPANY SINCE 1992
Mr. Barry has been a director of the Company since May 1992. Mr. Barry is an
independent management consultant. He was President of Alondra Development, Inc.
from 1989 to 1990 and was Chairman Emeritus of Theodore Barry & Associates,
Management Consultants from 1987 to 1989. Mr. Barry is also director of AHP
Holding Corporation.
RICHARD C. DRESDALE, AGE 41, DIRECTOR OF THE COMPANY SINCE 1986
Mr. Dresdale has been a director of the Company since 1986. He also served
as Assistant Secretary between 1987 and 1992 and as Vice President and Secretary
of the Company from 1986 to 1987. Since March 1994, Mr. Dresdale is a managing
director of Fenway Partners, Inc. Prior thereto, he was a principal at Clayton,
Dubilier & Rice, Inc. Mr. Dresdale is also a director of MW Manufacturers, Inc.,
Brown Moulding Company, Inc., Teters Floral Products, Inc., Bear Archery, Inc.,
Remington Arms Co., Inc., Aurora Foods, Inc. and CT Farm Country.
4
<PAGE>
DANIEL M. KERRANE, AGE 56, EXECUTIVE VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER SINCE 1992, DIRECTOR OF THE COMPANY SINCE 1993
Mr. Kerrane has been a director of the Company since November 1993 and
previously served as its Executive Vice President and Chief Financial Officer of
the Company. From January 1992 to November 1992, he served as a consultant to
Clayton, Dubilier & Rice, Inc. and to Homeland Stores, Inc. Mr. Kerrane was a
consultant to Lexmark International, Inc. from March 1991 to November 1992. He
served as Director of Finance and Planning Division at International Business
Machines Corporation from 1988 to 1991. On May 9, 1997 Mr. Kerrane filed a
lawsuit against the Company alleging the Company breached the terms of his
Supplemental Employment Agreement. See, "Executive Compensation-- Employment
Agreements," below.
Messrs. Howe, Barry, Dresdale and Kerrane are not nominees for director at
the Annual Meeting.
DIRECTOR NOMINEES. The following information with respect to the occupation
and business experience for the last five years of each director nominee who is
not currently serving as a director has been furnished to the Company by such
nominee.
PATRICK E. HOWARD, AGE 49, CHIEF OPERATING OFFICER SINCE FEBRUARY 1997,
CHIEF EXECUTIVE OFFICER SINCE AUGUST 1997 AND DIRECTOR NOMINEE
Mr. Howard has been Chief Operating Officer of the Company since February
1997 and became Chief Executive Officer of the Company in August 1997. He is
also a Director nominee. He was Executive Vice President of Mary Kay, Inc. from
December 1985 until January 1996. Since January 1996 Mr. Howard has been Chief
Executive Officer of the Richmont Group.
JOSEPH H. REICH, AGE 62, DIRECTOR NOMINEE
Mr. Reich has been Managing Partner of Centennial Associates L.P. since 1989
and has been its Chairman of the Board since 1987. Under Mr. Reich's management,
Centennial Associates L.P. and its affiliates have built a net worth of over
$300 million. He is also Chairman of the Board of PCA International, Inc. which
is a portrait photography retailer and a founding investor and director of New
York Investment Fund which is dedicated to stimulating entrepreneurship and job
development in New York City.
In addition, Messrs. Bolke, Brigante, Finn and Rochon are director nominees
and their biographical information appears above.
Additional information about the director nominees and the current directors
and officers of the Company, including information with respect to their
ownership of Common Stock and their compensation, appears below.
SECURITY OWNERSHIP OF PRINCIPAL
STOCKHOLDERS AND MANAGEMENT
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information regarding each person
known to the Company to own beneficially more than 5% of the outstanding Common
Stock of the Company. Such information has
5
<PAGE>
been obtained from the most recent public filings submitted, or other
information made available to the Company by such holders.
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENTAGE
NAME AND ADDRESS OF OF BENEFICIAL OF
BENEFICIAL OWNER OWNERSHIP(1) CLASS
- ------------------------------------------------------------------- ------------------ -----------
<S> <C> <C>
Ligapart AG 4,600,000 21.1%
Neuhofstrasse 4
6340 Bear, Switzerland
The Kaufmann Fund, Inc. 2,000,000 9.2%
140 East 45th Street
New York, New York 10017
Richmont Capital Partners I, L.P. 2,559,360 11.8%
4300 Westgrove,
Dallas, Texas 75248
Neuberger & Berman L.P. 1,133,800(2) 5.2%
605 Third Avenue,
New York, New York 10158
Joseph H. Reich, Peter K. Seldin 2,390,700(3) 11.0%
and G. Bryan Dutt
900 Third Avenue
New York, New York 10022
Oppenheimer Group, Inc. 2,062,600(4) 9.5%
Oppenheimer Tower
World Financial Center
New York, New York 10281
</TABLE>
- ------------------------
(1) Unless otherwise indicated, such shares of Common Stock are owned with sole
voting and investment powers.
(2) Shared investments power with respect to 1,133,800 shares of Common Stock or
5.2% of the shares of such class outstanding, and sole voting power with
respect to 79,700 shares of Common Stock or .3% of the shares of such class
outstanding. These shares are owned by many unrelated clients of Neuberger &
Berman L.P., a registered broker-dealer, which disclaims any economic
interest in the shares.
(3) Represents the aggregate of shares of Common Stock held by Centennial
Associates, L.P. and Tercentennial Energy Partners, L.P., of which Messrs.
Reich, Seldin and Dutt are general partners. Messrs. Reich, Seldin, and Dutt
have shared voting and shared investment power with respect to such shares.
(4) Represents the aggregate shares held by the Oppenheimer Group, Inc. and its
subsidiaries and affiliates, including Oppenheimer Financial Corp.,
Oppenheimer Equities Inc., Oppenheimer Holding, Inc., Oppenheimer & Co.,
Inc. and Oppenheimer Capital, L.P. Oppenheimer Group, Inc. is a parent
holding company and disclaims beneficial ownership and voting and
dispositive power over the shares held by its subsidiaries and their
clients.
6
<PAGE>
MANAGEMENT
The following table sets forth, as of August 22, 1997, certain information
as to the shares of Common Stock beneficially owned by each director and nominee
as director of the Company, by each Named Executive, as defined herein, and by
all directors and executive officers of the Company as a group:
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENTAGE
NAME AND ADDRESS OF OF BENEFICIAL OF
BENEFICIAL OWNER OWNERSHIP(1) CLASS
- ------------------------------------------------------------------ ------------------ -----------
<S> <C> <C>
John P. Rochon.................................................... 2,577,360(2)(3) 11.5%
Hubbard C. Howe................................................... 208,356(3)(4) *
David F. Brigante................................................. 212,555(5) *
Peter D. Kunoth................................................... 92,790(5) *
Patrick E. Howard................................................. -- *
James H. Groh..................................................... 8,000 *
Daniel M. Kerrane................................................. 74,024(5) *
Anthony G. Schmeck................................................ 57,781(5) *
Hans Paffhausen................................................... 40,000(5) *
Richard C. Dresdale............................................... 24,000(3) *
Theodore Barry.................................................... 18,000(5) *
Brian D. Finn..................................................... 28,000(3) *
Donald A. Bolke................................................... 12,000(5) *
C. Ronald Baiocchi................................................ 21,983(5) *
Joseph H. Reich................................................... 2,390,700(6) 10.7%
All directors and executive officers as a group (18 persons)...... 5,807,549(7) 25.9%
</TABLE>
- ------------------------
* less than 1% of class.
(1) Unless otherwise indicated, such shares of Common Stock are owned directly
with sole voting and sole investment power.
(2) Includes 2,559,360 shares owned by Richmont Capital Partners I, L.P., as to
which shares Mr. Rochon has shared voting and investment power.
(3) Includes 18,000 shares which may be acquired through the exercise of stock
options which are exercisable within 60 days of August 22, 1997.
(4) Includes 190,356 shares owned by Nevada Management Group, Inc. ("Nevada
Management Group"). Nevada Management Group is a Nevada corporation all the
capital stock of which is owned as separate property by Gene S. Howe, who is
married to Mr. Howe. Although Mr. Howe may be deemed beneficially to own
such shares because of his marriage to Gene S. Howe, Mr. Howe expressly
disclaims beneficial ownership of such shares.
(5) Represents shares which may be acquired through the exercise of stock
options which are exercisable within 60 days of August 22, 1997.
(6) Represents the aggregate shares of common stock held by Centennial
Associates, L.P. and Tercentennial Energy Partners, L.P., as to which Mr.
Reich has shared voting and investment power.
7
<PAGE>
(7) Includes 643,133 shares which may be acquired through the exercise of stock
options exercisable within 60 days of August 22, 1997 and other shares
deemed beneficially owned by the Company's directors as described in the
preceding notes.
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 own more than 10% of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
("SEC") and the NASDAQ National Market System. Executive officers, directors and
greater than 10% stockholders are required by SEC regulation to furnish the
Company with copies of all Section 16(a) reports they file. Based solely on a
review of the copies of such reports furnished to the Company and written
representations that no Forms 5 were required for the Fiscal Year other than for
James H. Groh, the Company believes that during the Fiscal Year no executive
officer, director or greater than 10% stockholders was delinquent in filing any
reports, except that Patrick E. Howard, Richard A. Larsen and Mr. Groh each
filed their initial statement of beneficial ownership on Form 3 one month late,
and Mr. Groh also filed his annual statement of changes in beneficial ownership
on Form 5 one month late.
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid to the Company's Chief
Executive Officer and the Company's other executive officers whose total salary
and bonus for the Fiscal Year exceeded $100,000 (the "Named Executives") with
respect to all services rendered to the Company during the pervious three fiscal
years.
8
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION -------------
-------------------------------------------------- SECURITIES
FISCAL YEAR OTHER ANNUAL UNDERLYING ALL OTHER
ENDED SALARY COMPENSATION OPTIONS/SARS COMPENSATION
NAME AND PRINCIPAL POSITION MARCH 31 ($)(1) BONUS ($) ($)(2) ($)(3) ($)(5)
- ------------------------------------------- ------------- --------- --------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
David F. Brigante.......................... 1997 $ 523,558 -- $ 13,133 -- $ 3,800
Chairman of the Board and 1996 $ 450,000 $ 630,000 $ 30,720 720,000 $ 653,696
Chief Executive Officer 1995 $ 320,269 -- $ 13,179 36,454 $ 53,136
Patrick E. Howard(4)....................... 1997 -- -- -- -- --
Chief Operating Officer
Daniel M. Kerrane.......................... 1997 $ 299,038 -- $ 29,498 -- $ 3,800
Executive Vice President 1996 $ 250,000 $ 262,500 $ 44,901 240,000 $ 423,696
and Chief Financial Officer 1995 $ 220,173 -- $ 23,497 22,328 $ 3,275
Anthony G. Schmeck......................... 1997 $ 224,231 -- $ 11,549 -- $ 3,800
Senior Vice President-- 1996 $ 185,000 $ 168,350 $ 16,843 160,000 $ 243,404
Finance, Corporate 1995 $ 160,062 $ -- $ 8,368 63,932 $ 43,101
Controller and Secretary
Hans Paffhausen............................ 1997 $ 249,730 -- $ 15,511 -- --
Managing Director of 1996 $ 267,237 $ 133,610 $ 17,240 -- --
European Operations
Peter D. Kunoth............................ 1997 $ 218,269 $ -- $ 12,895 -- $ 72,295
Former President and 1996 $ 250,000 $ 262,500 $ 84,820 -- $ 253,696
Chief Operating Officer(6) 1995 $ 220,077 -- $ 63,386 6,974 --
C. Ronald Baiocchi......................... 1997 $ 205,000 -- $ 9,012 -- $ 3,674
Senior Vice President-- 1996 $ 138,462 $ 96,000 $ 8,441 160,000 $ 62,437
Operations 1995 $ 104,698 -- $ 14,262 26,896 $ 36,820
</TABLE>
- ------------------------
(1) Includes, where applicable, amounts electively deferred by each Named
Executive under the Nu-kote International, Inc. Employees Savings Plan (the
"Savings Plan").
(2) Amounts listed in this column for fiscal 1997 include (a) automobile
allowances in the amounts of $8,770, $7,825, $7,186, $15,511, $8,543 and
$6,000 for Messrs. Brigante, Kerrane, Schmeck, Paffhausen, Kunoth and
Baiocchi, respectively; (b) club dues of $4,363 for each of Messrs.
Brigante, Kerrane and Schmeck, respectively, and $3,012 and $4,352 for
Messrs. Baiocchi and Kunoth, respectively; and (c) imputed interest on
relocation loan of $17,310 for Mr. Kerrane.
(3) No stock appreciation rights awards were granted in fiscal 1997.
(4) The services of Mr. Howard were made available to the Company pursuant to a
consulting agreement between Richmont Corporation and the Company. While the
Company does not compensate Mr. Howard directly for his services, the
Company has agreed to reimburse Richmont Corporation $240,000 per year for
operational, sales, financial, marketing and management consulting services
provided by Mr. Howard and other officers of Richmont Corporation and to
reimburse actual and reasonable expenses incurred by them in performing
services for the Company. Richmont Corporation is an affiliate of Richmont
Capital Partners I, L.P., see: Security Ownership Of Principal Stockholders
And Management.
(5) Amounts listed in this column for fiscal 1997 includes (a) the Company's
contributions to the Savings Plan (exclusive of amounts deferred at the
election of the Named Executive) on behalf of each of the Named Executives,
in the amount of $3,800 for each of Messrs. Brigante, Kunoth, Kerrane and
Schmeck and $3,674 for Mr. Baiocchi; and (b) relocation cost reimbursements
of $68,495 for Mr. Kunoth.
(6) President and Chief Operating Officer until October 22, 1996.
The following table sets forth the stock appreciation rights granted during
the Fiscal Year to each of the Named Executives and certain hypothetical values
for such options and rights.
9
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------------------- POTENTIAL REALIZABLE VALUE
PERCENT OF OF
NUMBER OF TOTAL ASSUMED ANNUAL RATES OF
SECURITIES OPTIONS/SARS STOCK PRICE APPRECIATION
UNDERLYING GRANTED TO EXERCISE OR FOR OPTION TERM(1)
OPTION/SARS EMPLOYEES BASE EXPIRATION ----------------------------
NAME GRANTED(#)(1) IN FISCAL YEAR PRICE($/SH) DATE 5%($) 10%($)
- ---------------------------------- --------------- ----------------- ------------- ----------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
David F. Brigante................. -- -- -- -- -- --
Patrick E. Howard................. -- -- -- -- -- --
Daniel M. Kerrane................. -- -- -- -- -- --
C. Ronald Baiocchi................ -- -- -- -- -- --
Peter D. Kunoth................... -- -- -- -- -- --
Anthony G. Schmeck................ -- -- -- -- -- --
Hans Paffhausen................... -- -- -- -- -- --
</TABLE>
- ------------------------
(1) Based upon the per share market price on the date of grant and on annual
appreciation of such market price through the expiration date of such
awards at the stated rates. These amounts represent assumed rates of
appreciation only and may not necessarily be achieved. Actual gains, if
any, are dependent on the future performance of the Common Stock, as well
as the continued employment of the Named Executive through the term of the
awards. The potential realizable values indicated have not taken into
account amounts required to be paid as income tax under the Internal
Revenue Code of 1986, as amended, and any applicable state laws.
The following table sets forth the number of and value realized on shares
acquired on exercise of stock options during the Fiscal Year and the number of
shares covered by exercisable and unexercisable options and stock appreciation
rights held, and the dollar values which would have been realized on exercise of
such options and stock appreciation rights, on March 31, 1997 by each of the
Named Executives.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED "IN-THE-MONEY"
OPTIONS/SARS OPTIONS/SARS
SHARES AT FY-END (#) AT FY-END ($)(1)
ACQUIRED VALUE -------------------------- ----------------------------------
NAME ON EXERCISE REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------------- ----------------- --------------- ----------- ------------- --------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
David F. Brigante............... -- -- 200,094 112,214 -- --
Patrick E. Howard............... -- -- 0 0 -- --
Daniel M. Kerrane............... -- -- 65,011 62,491 -- --
C. Ronald Baiocchi.............. -- -- 18,142 21,060 -- --
Peter D. Kunoth................. -- -- 92,790 0 -- --
Anthony G. Schmeck.............. -- -- 52,140 56,070 -- --
Hans Paffhausen................. -- -- 40,000 60,000 -- --
</TABLE>
- ------------------------
(1) Based upon the closing price of the Common Stock ($2.75) on the NASDAQ
National Market System on March 31, 1997.
10
<PAGE>
PENSION PLAN TABLE
The following table sets forth the estimated annual benefits payable to
hypothetical participants who are entitled to the maximum benefits under the
tax-qualified non-contributory defined benefit plan maintained by the Company
(the "Pension Plan") in the compensation and years-of-service categories
indicated in the table upon retirement at normal retirement age (65 years of
age). The amounts shown are based upon the assumption that such benefits will be
paid in the form of a single life annuity and assume offset for social security
benefits.
<TABLE>
<CAPTION>
ANNUALIZED
AVERAGE 10 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
FINAL PAY OF SERVICE OF SERVICE OF SERVICE OF SERVICE OF SERVICE
- ------------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
$ 50,000 $ 6,777 $ 10,818 $ 12,073 $ 13,551 $ 14,951
75,000 9,438 15,644 18,845 21,918 24,318
100,000 12,563 21,894 26,658 31,293 34,693
125,000 15,688 28,144 34,470 40,668 45,068
150,000 18,813 34,394 42,283 50,043 55,443
175,000 18,813 34,394 42,283 50,043 55,443
200,000 18,813 34,394 42,283 50,043 55,443
225,000 18,813 34,394 42,283 50,043 55,443
250,000 18,813 34,394 42,283 50,043 55,443
</TABLE>
The Pension Plan provides retirement benefits of an employee's years of
service and such employee's average annual earnings (subject to a maximum of
$150,000 annually, as adjusted by the Internal Revenue Service for cost of
living increases after 1995) for the 60 highest consecutive months' compensation
during the 120 months prior to retirement (and if the employee has been employed
less than five years, the average of compensation during all months employed.)
Compensation include all salary or wages, including commission, shift premiums,
tax deferred contributions made to the Nu-kote International, Inc. Employees
Savings Plan on an employee's behalf and payments for non-work periods during
active employment, but does not include any other form of remuneration.
At March 31, 1997, the credited years of service and the compensation
covered under the Pension Plan of the participating Named Executives were as
follows:
<TABLE>
<CAPTION>
YEARS OF SERVICE COVERED COMPENSATION
------------------- ---------------------
<S> <C> <C>
David F. Brigante 17 $ 150,000
Daniel M. Kerrane 4 $ 150,000
C. Ronald Baiocchi 20 $ 150,000
Peter D. Kunoth 3 $ 150,000
Anthony G. Schmeck 10 $ 150,000
</TABLE>
Mr. Hans Paffhausen is not covered by the above referenced Pension Plan, but
is covered by a separate plan in Switzerland.
EMPLOYMENT AGREEMENTS
Messrs. Brigante and Schmeck are currently employed by the Company pursuant
to agreements which provide, among other things, that each is to receive (i) an
annual base salary at a rate that is not less than his annual fixed or base
compensation in effect prior to February 1995 or such higher rate as may be
11
<PAGE>
determined from time to time by the Board of Directors or the Compensation
Committee, and (ii) an amount equal to not less than the highest aggregate
annual bonus, incentive or other cash compensation made or to be made in any
fiscal year during the three fiscal years prior to the fiscal year ended March
31, 1995. Under the agreements they are also to receive other employment
benefits (such as group health, life and disability insurance, use of Company
automobiles, country club membership and monthly dues, and participation in
retirement and long-term incentive programs and plans, including stock option,
stock appreciation rights, pension, savings, salary continuation and the like),
during a three-year period of employment (two years with respect to Mr.
Schmeck), commencing February 24, 1995, which is extended annually for an
additional year unless the executive or the Company gives notice to the
contrary. The agreements also provide that if the executive is terminated for
reasons other than death, disability or cause, as defined, or if Mr. Brigante
elects to terminate his employment because of, among other things, the failure
to elect him to the office or offices, which he previously held, a significant
adverse change in the nature or scope of his authorities, powers, functions,
responsibility or duties, a liquidation, dissolution, merger, consolidation or
reorganization of the Company or transfer of all or a significant portion of its
business and/or assets, or a relocation of the Company's principal executive
offices, the executive will receive a lump sum payment equal to the present
value of the sum of his (i) aggregate base salary (at the highest rate in effect
for any fiscal year prior to the termination date) for each remaining year or
partial year of the employment period, and (ii) aggregate bonus, incentive or
other similar payment (based upon the highest amount of bonus, incentive or
other similar payment paid or payable to him for any year during the term but
prior to the year of termination), which he would have received during the
remainder of his employment period; provided, however, that such amount will be
reduced to the minimum extent necessary so that no portion of such lump sum
payment will constitute an excess parachute payment as defined in Section 280G
of the Internal Revenue Code of 1986, as amended. Subject to the foregoing
limitations, he will also receive for the remainder of the employment period
substantially the same employee benefits as he was otherwise entitled to
immediately prior to termination.
Mr. Kerrane had been employed by the Company under an agreement that was
similar to those of Messrs. Brigante and Schmeck. However, on May 9, 1997, Mr.
Kerrane filed suit against the Company in a Texas State District Court in Dallas
County, Texas. Mr. Kerrane alleges that his agreement with the Company entitled
him to terminate his employment and receive a lump sum severance payment because
the Company "substantially reduced" his authorities, powers, and duties in April
1997. Mr. Kerrane alleges the Company has breached his agreement and breached a
duty of good faith and fair dealing. He seeks specific performance of the
agreement. He also alleges that his agreement with the Company requires the
Company to secure an irrevocable standby letter of credit to pay his legal fees,
and seeks an injunction restraining the Company from refusing to secure the
letter of credit.
For the breach of contract claim, Mr. Kerrane seeks an amount in excess of
$2,000,000.00. He also seeks an unspecified amount of damages for attorneys'
fees. Regarding the breach of duty of good faith and fair dealing, he seeks
damages in excess of $2,000,000.00 and punitive damages in the amount of
$4,000,000.00. The Company denies Mr. Kerrane's allegations and is vigorously
defending the suit.
12
<PAGE>
CERTAIN TRANSACTIONS
On May 20, 1994, the Company provided Mr. Kerrane with an interest-free loan
in the amount of $300,000 for the purpose of assisting Mr. Kerrane in relocating
to the Dallas area. The loan, as amended, was to be repaid from awards granted
to Mr. Kerrane for the contributions to future merger and acquisition
transactions (excluding the acquisition of the worldwide hardcopy supplies
business of Pelikan Holding AG). One third of the principal amount of the loan
was to be forgiven when and if Modular Ink Technology AB, a subsidiary of the
Company, was deemed to have achieved its financial objectives. Under the terms
of the agreement, in the event of a change in control of the Company, a change
in his duties or an involuntary separation from the Company, the loan is to be
considered repaid in full. The agreement further provides that if Mr. Kerrane
voluntarily terminates his employment the Company is to offset any separation
payments due Mr. Kerrane against the loan, and any remaining balance on the loan
after the offset is to be repaid by him within 36 months after the date of
termination. At March 31, 1997, the loan to Mr. Kerrane had an outstanding
principal balance of $300,000.
COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION
The Compensation and Benefits Committee currently consists of Messrs.
Dresdale, Finn and Rochon. Mr. Dresdale is a former executive officer of the
Company. The Stock Option Committee currently consists of Messrs. Bolke and
Rochon.
COMPENSATION AND BENEFITS COMMITTEE AND
STOCK OPTION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation and Benefits Committee (the "Committee") of the Board is
responsible for setting and administering the policies governing annual
compensation for the Company's executive officers, including the Chief Executive
Officer and other key members of management. The Stock Option Committee is
responsible for granting stock options and stock appreciation rights to
executive officers and other key employees of the Company and its subsidiaries.
The key elements of executive compensation are base salary, annual incentive
awards and long-term stock based awards.
BASE SALARY
The Committee determines base salaries for executive officers by evaluating
the responsibilities of the position held and the experience of the individual,
and by reference to the competitive market place for executive talent, including
a comparison to base salaries for comparable positions at other companies deemed
by the Committee to be in the Company's peer group, and to historical levels of
salary paid by the Company and its predecessors. Salary adjustments are based on
a periodic evaluation of the performance of the Company and of each executive
officer, and also take into account new responsibilities as well as changes in
the competitive market place. Mr. Brigante, who served as Chairman of the Board
and Chief Executive Officer of the Company during the Fiscal Year, received a
base salary of $525,000.
INCENTIVE COMPENSATION
Each year, the Committee reviews and approves an incentive compensation plan
for executive officers and other key employees based on targeted levels of
earnings before interest and taxes ("EBIT") and cash flow for the year. If the
Company achieves at least 75% of its targeted EBIT, senior executive officers
13
<PAGE>
receive as bonuses a percentage of their salaries ("Salary Percentage"), ranging
from 10% to 100% depending on their job level and responsibility, adjusted for
the ratios of the Company's actual EBIT and cash flow to targeted EBIT and cash
flow. The maximum bonus payable to any executive officer is limited to 1.5 times
the executive officer's Salary Percentage. This level would be reached if actual
EBIT and cash flows were greater than 115% (or, in the case of certain officers,
110%) of established targets for the year. During the Fiscal Year, the Company
did not exceed its EBIT and cash flow targets and bonuses were not paid to any
participant officers of the Company.
STOCK BASED AWARDS
No stock based awards were granted to any Named Executives of the Company
during the Fiscal Year.
OTHER COMPENSATION
Other compensation payable to the executives of the Company include
contributions to the Company's savings plan paid by the Company. In addition,
under the terms of their employment agreements, Messrs. Brigante and Schmeck are
furnished other customary employment benefits, including the use of automobile
and reimbursement of club dues.
Compensation and Benefits Committee June 26,
1997
RICHARD C. DRESDALE, CHAIRMAN
BRIAN D. FINN
JOHN P. ROCHON
Stock Option committee
DONALD A. BOLKE
JOHN P. ROCHON
14
<PAGE>
PERFORMANCE GRAPH
The following graph compares the cumulative total return of the Company, the
S&P 500 index and a peer group composed of the following companies, weighted by
market value at each measurement point: American Business Products, Inc.,
Diebold, Inc., Ennis Business Forms Inc., General Binding Corp., Hunt
Manufacturing Co., Moore Limited, New England Business Service, Inc., Nashua
Corp., National Computer Systems, Inc., Office Depot, Inc., Pitney Bowes, Inc.,
Reynolds & Reynolds Co., Scritex Ltd., Standard Register, Co., Staples Inc., Tab
Products Co., United Stationers, Inc., Wallace Computer Services, Inc. and Xerox
Corporation. The graph assumes $100 was invested in the Company's Common Stock
on October 1, 1992, or in shares comprising the S&P 500 Index or the peer group
on September 30, 1992 and also assumes reinvestment of dividends. Other than for
the above dates, the values noted are as of March 31 of each year indicated.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NU-KOTE HOLDING, INC. S&P 500 PEER GROUP
<S> <C> <C> <C>
10/1/92 100 100 100
3/93 177 110 116
3/94 173 111 127
3/95 192 129 140
3/96 291 167 170
3/97 45 203 241
</TABLE>
15
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
Six directors are to be elected at the Annual Meeting. David F. Brigante,
Brian D. Finn, John P. Rochon, Donald A. Bolke, Patrick E. Howard and Joseph H.
Reich have been nominated by the Board for election at the Annual Meeting.
Shares represented by the accompanying form of proxy will be voted "FOR" the
election of the above nominees unless authority to vote for one or more nominees
is withheld. Directors must be elected by a plurality of the votes validly cast
in such election at the Annual Meeting. Abstentions on this proposal will be
counted for quorum purposes but not voted. Broker non-votes will have no effect
on the outcome of the election of directors.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The stockholders are asked to ratify the appointment by the Board of Coopers
& Lybrand L.L.P. as the Company's independent auditors for fiscal 1998. Coopers
& Lybrand L.L.P., a certified public accounting firm, has served as the
Company's independent auditors since 1987.
Representatives of Coopers & Lybrand L.L.P. are expected to be present at
the Annual Meeting to respond to appropriate questions and to make such
statements as they desire.
The Board recommends you vote "FOR" the ratification of the appointment of
Coopers & Lybrand L.L.P. as the Company's independent auditors for fiscal year
1998 and your proxy will be so voted unless you specify otherwise. Adoption of
this proposal requires approval by the holders of a majority of the shares
represented, in person or by proxy, at the Annual Meeting. Abstentions on this
proposal will be counted for quorum purposes but not voted and, therefore, will
have the same effect as votes against the proposal. Broker non-votes will have
no effect on the outcome of the vote on this proposal.
PROPOSALS BY STOCKHOLDERS
Proposals by stockholders intended to be presented at the 1998 Annual
Meeting of Stockholders must be received by the Secretary of the Company no
later than April 27, 1998, to be included in the Company's proxy, notice of
meeting and proxy statement for such meeting. In addition, the By-Laws of the
Company provide that only stockholder proposals submitted in a timely manner to
the Secretary of the Company may be acted upon at an annual meeting of
stockholders. To be timely, a stockholder's notice must be delivered to, or
mailed and received at, the principal executive office of the Company not less
than 30 calendar days prior to the date of the originally scheduled meeting;
provided, however, that, if less than 40 calendar days' notice or prior public
disclosure of the date of the scheduled meeting is given or made by the Company,
notice by the stockholder to be timely must be so received not less than the
close of business on the tenth calendar day following the earlier of the day on
which such notice of the scheduled meeting was mailed or the day on which such
public disclosure was made. Any proposals by stockholders should be mailed to or
delivered at Nu-kote Holding, Inc., 17950 Preston Road, Suite 690, LB21, Dallas,
Texas 75252, Attention: Secretary.
16
<PAGE>
ANNUAL REPORT
The Company's 1997 Annual Report to Stockholders (which does not form a part
of the proxy solicitation material) containing audited financial statements for
the fiscal year ended March 31, 1997, is being mailed to all stockholders of
record with this Proxy Statement.
The form of proxy and the Proxy Statement have been approved by the Board of
Directors and are being mailed and delivered to stockholders by its authority.
ANTHONY G. SCHMECK
SECRETARY
August 22, 1997
17
<PAGE>
PROXY
NU-KOTE HOLDING, INC.
ANNUAL MEETING OF STOCKHOLDERS
AUGUST 13, 1997
This Proxy is solicited on behalf of the Board of Directors
The undersigned hereby constitutes and appoints David F. Brigante and Anthony
G. Schmeck, or either of them, as the true and lawful attorneys and proxies
of the undersigned, with full power of substitution, to represent the
undersigned and to vote all of the shares of Class A Common Stock of Nu-kote
Holding, Inc. (the "Company"), that the undersigned is entitled to vote at
the Annual Meeting of Stockholders of the Company to be held on August 13,
1997 and at any adjournment thereof.
THIS PROXY WILL BE VOTED AS SPECIFIED ON THE REVERSE SIDE. IF NO SPECIFIC
DIRECTIONS ARE GIVEN, THIS PROXY WILL BE VOTED "FOR" THE ELECTION OF
DIRECTORS, "FOR" EACH OF THE PROPOSALS SET FORTH HEREIN AND IN THE DISCRETION
OF THE PROXY HOLDERS ON ALL OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE
MEETING.
-----------
See Reverse
Side
-----------
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
<PAGE>
<TABLE>
Please mark //X//
your votes as
indicated in
this example
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
1.Election of Directors. Nominees: 2. Ratification of Appointment of Coopers & / / / / / /
FOR all nominees WITHHOLD David F. Brigante, Lybrand L.L.P. as Independent Auditors
listed to the right Authority Donald A. Bolke, for fiscal 1998.
(except as marked to vote for all Brian D. Finn,
to the contrary) nominees named John P. Rochon, 3. In their discretion, to vote upon such
to the right Patrick E. Howard, other business as may properly come before
/ / / / Joseph H. Reich the meeting or any adjournment thereof.
(Instruction: To
withhold authority to
vote for any individual
nominee, write the
nominee's name on the
line below.)
------------------------
Please sign exactly as the name
appears on the certificate or
certificates representing shares to
be voted by this proxy. When signing
as executor, administrator, attorney,
trustee or guardian, please give full
title as such. If a corporation,
please sign in full corporate name by
president or other authorized person.
If a partnership, please sign in
partnership name by authorized person.
Signature of Stockholder Signature (if jointly owned) Dated: , 1997
------------------------ ------------------------ -------------
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED ENVELOPE.
</TABLE>
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
