<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
[X] Definitive Proxy Statement RULE 14C-5(D)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
The Score Board, Inc.
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
The Score Board, Inc.
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notes:
<PAGE>
-------------------------------------------------------------------------------
THE PROMPT RETURN OF PROXY CARDS WILL SAVE THE COMPANY
THE EXPENSE OF FURTHER REQUESTS FOR PROXIES IN ORDER
TO ASSURE A QUORUM
-------------------------------------------------------------------------------
THE SCORE BOARD, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 18, 1995
PLEASE TAKE NOTICE that the 1995 Annual Meeting of Shareholders of THE SCORE
BOARD, INC. will be held at the Sheraton Poste Inn, I-295 & Route 70, 1450
Route 70 West, Cherry Hill, New Jersey 08034, on Monday, September 18, 1995 at
1:30 p.m. E.D.T., for the following purposes:
1. To elect five members of the Board of Directors for a one-year term;
and
2. To transact such other and further business as may properly come
before the meeting or any adjournment(s) thereof.
Only shareholders of record at the close of business on August 8, 1995 are
entitled to notice of and to vote at the meeting.
By Order of the Board of Directors,
Patrick J. Wujcik,
Secretary
August 17, 1995
<PAGE>
THE SCORE BOARD, INC.
1951 OLD CUTHBERT ROAD
CHERRY HILL, NEW JERSEY 08034
----------------
PROXY STATEMENT
----------------
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
ON SEPTEMBER 18, 1995
GENERAL INFORMATION
The enclosed proxy is solicited by and on behalf of The Score Board, Inc., a
New Jersey corporation ("the Company"), for use at the 1995 Annual Meeting of
Shareholders to be held on Monday, September 18, 1995 at 1:30 P.M., E.D.T., at
the Sheraton Poste Inn, I-295 & Route 70, 1450 Route 70 West, Cherry Hill, New
Jersey 08034 and at any postponement or adjournment thereof (the "Annual
Meeting"). The approximate date on which this Proxy Statement and the
accompanying form of proxy will first be sent or given to shareholders is
August 17, 1995. Sending a signed proxy will not affect the shareholder's
right to attend the Annual Meeting and vote in person since the proxy is
revocable. The grant of a later proxy revokes this proxy. The presence at the
meeting of a shareholder who has given a proxy does not revoke the proxy
unless the shareholder files written notice of the revocation with the
secretary of the meeting prior to the voting of proxy or votes the shares
subject to the proxy by written ballot.
The expense of the proxy solicitation will be borne by the Company. In
addition to solicitation by mail, proxies may be solicited in person or by
telephone, telecopier, telegraph or teletype by directors, officers or
employees of the Company without additional compensation. The Company is
required to pay the reasonable expenses incurred by record holders of the
common stock, par value $.01 per share, of the Company (the "Common Stock")
who are brokers, dealers, banks or voting trustees, or other nominees, for
mailing proxy material and annual shareholder reports to any beneficial owners
of Common Stock they hold of record, upon request of such record holders.
A form of proxy is enclosed. If properly executed and received in time for
voting, and not revoked, the enclosed proxy will be voted as indicated in
accordance with the instructions thereon. If no directions to the contrary are
indicated, the persons named in the enclosed proxy will vote all shares of
Common Stock for the election of the nominees for director.
The enclosed proxy confers discretionary authority to vote with respect to
any and all of the following matters that may come before the meeting: (i)
matters which the Company does not know about a reasonable time before the
proxy solicitation and are presented at the meeting; (ii) approval of the
minutes of a prior meeting of shareholders, if such approval does not amount
to ratification of the action taken at the meeting; (iii) the election of any
person to any office for which a bona fide nominee is unable to serve or for
good cause will not serve; and (iv) matters incident to the conduct of the
meeting. In connection with such matters, the persons named in the enclosed
form of proxy will vote in accordance with their best judgment.
OUTSTANDING SHARES AND VOTING RIGHTS
The Company had 11,251,571 shares of Common Stock outstanding at the close
of business on August 8, 1995, the record date fixed for the determination of
shareholders entitled to notice of and to vote at the Annual Meeting. The
presence, in person or by proxy, of shareholders entitled to cast at least a
majority of the votes which all shareholders are entitled to cast on a
particular matter constitutes a quorum for the purpose of considering such
matter. Each share of Common Stock outstanding is entitled to one vote on each
matter which may be brought before the Annual Meeting. The election of
directors will be determined by a plurality vote, and the nominees receiving
the most "for" votes will be elected. Approval of any other proposal will
require the
1
<PAGE>
affirmative vote of a majority of the shares cast on the proposal. An
abstention, withholding of authority to vote for or broker non-vote,
therefore, will not have the same legal effect as an "against" vote and will
not be counted in determining whether the proposal has received the required
shareholder vote. Shareholders do not have appraisal or dissenter rights with
respect to election of directors.
SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of July 31, 1995, information concerning
beneficial ownership of shares of the Company's Common Stock with respect to
(i) each person known to the Company to own 5% or more of the outstanding
shares of Common Stock, (ii) each director of the Company, (iii) each of the
executive officers named in the Summary Compensation Table and (iv) all
directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
NMEA
NDA
ADRESSD PERCENT OF
FO NUMBER OF SHARES CLASS
BENEICIALF BENEFICIALLY BENEFICIALLY
ONERW OWNED OWNED
---------- ---------------- ------------
<S> <C> <C>
DIRECTORS AND NAMED EXECUTIVE OFFICERS*
Kenneth Goldin................................... 1,585,150(1) 13.7%
Michael A. Berkus................................ 21,000(2) **
Michael Hoppman.................................. 28,000(3) **
Robert H. Gartlan................................ 0 **
Scott Schnell.................................... 26,075(4) **
Allan R. Lyons................................... 188,000(5) 1.7%
Fred A. Shabel................................... 65,000(6) **
Gerald B. Shreiber............................... 30,000(7) **
Richard C. Yancey................................ 130,000(8) 1.1%
FIVE PERCENT SHAREHOLDERS
Carole Goldin.................................... 1,324,500(9) 11.7%
526 Garwood Drive
Cherry Hill, NJ 08003
T. Rowe Price Associates, Inc.***................ 1,000,000 8.9%
100 East Pratt Street
Baltimore, MD 21202
All Directors and Executive Officers as a Group
(14 persons).................................... 2,099,955(10) 17.5%
</TABLE>
--------
* The address for each person listed is c/o The Score Board, Inc., 1951 Old
Cuthbert Road, Cherry Hill, New Jersey 08034.
** Indicates less than one percent.
*** This information has been derived from a listing prepared by Jaffoni &
Collins, Inc. reflecting reports on Form 13F, for the period ending March
31, 1995, filed by T. Rowe Price Associates, Inc.
--------
(1) Includes 339,750 shares of Common Stock issuable upon exercise of stock
options exercisable within sixty days of the mailing date of this proxy
statement ("currently exercisable"). The number of shares of Common Stock
reported also includes 489,500 shares of Common Stock over which Carole
Goldin has sole investment power as Executrix and beneficiary of the
Estate of Paul Goldin; Kenneth Goldin was appointed as attorney and proxy
to vote said shares as of June 6, 1994.
(2) Includes 20,000 shares of Common Stock issuable upon exercise of
currently exercisable stock options.
(3) Includes 28,000 shares of Common Stock issuable upon exercise of
currently exercisable stock options.
(4) Includes 24,375 shares of Common Stock issuable upon exercise of
currently exercisable stock options.
(5) Includes 130,500 shares of Common Stock issuable upon exercise of
currently exercisable stock options.
(6) Includes 60,000 shares of Common Stock issuable upon exercise of
currently exercisable stock options.
2
<PAGE>
(7) Includes 30,000 shares of Common Stock issuable upon exercise of
currently exercisable stock options.
(8) Includes 90,000 shares of Common Stock issuable upon exercise of
currently exercisable stock options.
(9) Paul Goldin passed away on May 21, 1994. Mr. Goldin's widow, Carole
Goldin, is the Executrix and beneficiary of Mr. Goldin's estate. The
number of shares of Common Stock reported includes 739,000 shares of
Common Stock owned directly by Carole Goldin, 489,500 shares of Common
Stock owned by Carole Goldin as Executrix and beneficiary of the Estate
of Paul Goldin (Kenneth Goldin was appointed as attorney and proxy to
vote such shares--see footnote (1) above) and 96,000 shares of Common
Stock issuable upon exercise of currently exercisable options held by the
Estate of Paul Goldin.
(10) Includes 738,875 shares of Common Stock issuable upon exercise of
currently exercisable stock options. The number of shares of Common Stock
reported also includes 489,500 shares of Common Stock over which Carole
Goldin has sole investment power, but which Kenneth Goldin has power to
vote (see footnote (1) above).
ELECTION OF DIRECTORS
Five (5) directors are expected to be elected at the Annual Meeting to serve
on the Company's Board of Directors until the 1996 Annual Meeting of
Shareholders and until each of their respective successors has been duly
elected and qualified as provided in the Company's By-Laws.
The following table sets forth information concerning the Company's nominees
for election to the Board of Directors. All nominees are currently serving on
the Board of Directors under terms which will expire at the Annual Meeting. If
any of the nominees becomes unable to serve, or for good cause will not serve,
the persons named in the enclosed form of proxy will vote in accordance with
their best judgment for the election of such substitute nominee or nominees as
shall be designated by the Board of Directors. The Company's Board of
Directors expects all nominees to be willing and able to serve.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF EACH OF THE
NOMINEES FOR DIRECTOR.
<TABLE>
<CAPTION>
NAME AGE POSITION WITH THE COMPANY
---- --- -------------------------
<S> <C> <C>
Kenneth Goldin........................ 30 Chairman, Chief Executive Office,
President and Director
Allan R. Lyons........................ 54 Director
Fred A. Shabel........................ 63 Director
Gerald B. Shreiber.................... 54 Director
Richard C. Yancey..................... 69 Director
</TABLE>
Kenneth Goldin has been employed by the Company in various capacities since
1987 and has been a Director since July 1989. Mr. Goldin has served as
Chairman of the Board, President and Chief Executive Officer of the Company
since May 22, 1994, and served as Executive Vice President from July 1989
through May 21, 1994. Mr. Goldin is a defendant in the class action litigation
described under "Legal Proceedings".
Allan R. Lyons has served as a Director of the Company since June 1990.
Since November 1993, Mr. Lyons has been the Chairman of the Board and Chief
Executive Officer of Piaker & Lyons, P.C., Certified Public Accountants, and
he served as Executive Vice President prior thereto. Mr. Lyons also serves as
a director of Starlog Franchise Corporation, Action Performance Companies and
Franklin Credit Management Corporation.
Fred A. Shabel has served as a Director of the Company since March 1991. Mr.
Shabel has been the Chairman of the Board of Spectacor, Inc. ("Spectacor")
since 1980. Spectacor, which is involved in sports and entertainment, includes
among its affiliated entities the National Hockey League's Philadelphia Flyers
and The CoreStates Spectrum (an arena in Philadelphia, Pennsylvania).
3
<PAGE>
Gerald B. Shreiber has served as a Director of the Company since December
1994. Mr. Shreiber is the founder of J&J Snack Foods Corp. and has served as
its Chairman of the Board, President and Chief Executive Officer since its
inception in 1971.
Richard C. Yancey has served as a Director of the Company since November
1992. Mr. Yancey had been an investment banker with Dillon, Read & Company,
Inc. from 1952 through 1992, holding various positions, including managing
director from 1975 to 1990, director from 1990 to 1991, and senior advisor
from 1991 through 1992. Mr. Yancey also provided consulting services to the
Company from October 1991 to October 1994. In addition, Mr. Yancey currently
serves as a director of eight mutual fund companies of The Composite Group.
Each director is elected for a one-year period ending on the date of the
next Annual Meeting of Shareholders of the Company. There are no family
relationships among any of the directors.
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the directors and certain officers of the Company, and persons who own more
than ten percent of the Company's Common Stock, to file with the Securities
and Exchange Commission initial reports of ownership and reports of changes in
ownership of such Common Stock. Such directors, officers and more than ten
percent shareholders are required by regulation to furnish the Company with
copies of all Section 16(a) reports which they file. To the Company's
knowledge, based solely upon a review of the reports furnished to the Company,
all such reports were filed on a timely basis.
DIRECTOR MEETINGS AND DIRECTOR COMPENSATION
The Board of Directors held four meetings in fiscal year 1995. No director
attended fewer than 75 percent of the meetings of the Board of Directors or
committee meetings of committees on which he served.
The Board of Directors has the authority to establish reasonable
compensation of directors for services to the Company. Additionally, pursuant
to the terms of the 1992 Directors Stock Option Plan, each eligible non-
employee director is entitled to receive on September 1 of each fiscal year:
(i) an option to purchase 15,000 shares of Common Stock at an exercise price
equal to the fair market value of the Common Stock on the date the option is
granted, which option will first be exercisable six months after the date of
grant; and (ii) an option to purchase 15,000 shares of Common Stock at an
exercise price equal to 120% of the fair market value of the Common Stock on
the date the option is granted, which option will first be exercisable on the
date of grant.
Messrs. Lyons, Shabel and Yancey, with Mr. Shreiber, the only outside
directors of the Company, were paid $2,000 each for attending committee
meetings during fiscal year 1995. Pursuant to the Company's 1992 Directors
Stock Option Plan, in September 1994, Messrs. Lyons, Shabel and Yancey were
each granted non-qualified stock options (the "Options") to purchase 15,000
shares each of the Company's Common Stock at an exercise price of $4.50 per
share (100% of the fair market value of the Company's Common Stock on the date
of grant) and Retainer Options (the "Retainer Options") to purchase 15,000
shares each of the Company's Common Stock at an exercise price of $5.40 per
share (120% of the fair market value of the Company's Common Stock on the date
of grant). The Options and Retainer Options all expire upon the earlier of ten
(10) years from their respective dates of grant or three months from the date
the grantee ceases to be a director of the Company. The Options and Retainer
Options became exercisable on March 1, 1995 and September 1, 1994,
respectively.
Upon his election as a director of the Company in December 1994, Mr.
Shreiber was granted a non-qualified stock option to purchase 30,000 shares of
the Company's Common Stock at an exercise price of $2.625 per share. The
option has a ten year term and became exercisable on June 8, 1995.
During fiscal 1995, Mr. Yancey received $25,000 from the Company for
financial advice rendered in accordance with the terms of a consulting
agreement with the Company.
4
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain summary information concerning the
compensation paid to the Company's Chief Executive Officer and other highly
compensated executive officers whose total annual salary and bonus were in
excess of $100,000 (collectively, the "Named Executive Officers") for services
rendered in all capacities to the Company and its subsidiaries for the years
ended January 31, 1995, 1994 and 1993:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------------------------------- ------------
FISCAL SECURITIES ALL OTHER
YEAR UNDERLYING COMPEN-
NAME AND ENDED SALARY BONUS OPTIONS SATION
PRINCIPAL POSITION JANUARY 31, ($) ($) (#) ($)(1)
------------------ ----------- ------- ------ ------------ ---------
<S> <C> <C> <C> <C> <C>
Paul Goldin................. 1995 172,399 0 0 12,601
Chief Executive Officer (2) 1994 219,917 0 58,000 26,894
1993 204,000 50,000 50,000 33,384
Kenneth Goldin.............. 1995 375,822 0 150,000(3) 39,499
Chief Executive Officer 1994 190,750 0 120,000 8,363
1993 174,000 75,000 105,000 9,989
Michael A. Berkus........... 1995 10,385 0 50,000(4) 117,400
Sr. V.P.--Sales & Marketing
(4) 1994 -- -- -- --
1993 -- -- -- --
Michael A. Hoppman.......... 1995 103,608 0 10,000 8,983
Vice President--Finance 1994 77,423 15,000 18,000 4,800
1993 61,502 12,500 10,000 0
Robert H. Gartlan........... 1995 117,316 0 0 196,082
Vice President--Ceramics
(5) 1994 41,667 0 0 1,200
Scott Schnell............... 1995 143,884 0 48,750 161,054
Sr. Vice President
Operations (6) 1994 92,308 30,000 23,000 4,800
1993 80,915 17,500 12,000 4,200
</TABLE>
--------
(1) Includes (a) Company contributions under its profit sharing plan for
certain of the Named Executive Officers (Messrs. Paul Goldin $6,045;
Kenneth Goldin $3,621; Hoppman $3,470; and Schnell $4,774); (b) Company
payments on behalf of the Named Executive Officers of certain life
insurance premiums (Messrs. Paul Goldin $6,556; Kenneth Goldin $35,878;
Hoppman $713; Gartlan $8,820; and Schnell $520); (c) consulting fees and
related amounts paid to Mr. Berkus pursuant to his consulting agreement
prior to his becoming an officer of the Company ($117,400); (d) royalties
and other payments to Mr. Gartlan pursuant to his employment agreement and
consulting agreement ($182,462); (e) a moving bonus paid to Mr. Schnell
pursuant to his employment agreement ($150,000); and (f) car allowances
for certain of the Named Executive Officers (Messrs. Hoppman $4,800;
Gartlan $4,800; and Schnell $5,760).
(2) On May 21, 1994, Paul Goldin passed away. Pursuant to an employment
agreement entered into on March 30, 1994, effective as of January 1, 1994,
Mr. Goldin was to receive an annual salary of $395,000 through December
31, 1996. In accordance with said employment agreement, the Company is
required to pay approximately $900,000 to Mr. Goldin's estate. The
liability outstanding at January 31, 1995 was $738,000.
(3) On June 10, 1994, Kenneth Goldin was conditionally granted an option to
purchase 100,000 shares of the Company's Common Stock at an exercise price
of $8.25 per share pursuant to the Company's 1992 Stock Incentive Plan.
Effective September 30, 1994, the option was cancelled, and Mr. Goldin was
granted an option to purchase 50,000 shares of Common Stock at an exercise
price of $5.00 per share under the plan.
5
<PAGE>
(4) Mr. Berkus joined the Company in September 1994. Prior thereto, Mr. Berkus
provided consulting services to the Company pursuant to a consulting
agreement dated April 11, 1994. Pursuant to the consulting agreement, Mr.
Berkus was granted an option to purchase 10,000 shares of the Company's
Common Stock pursuant to the Company's 1993 Non-Employee Stock Option
Plan. Effective April 17, 1995, the option was cancelled.
(5) As of December 24, 1994, Mr. Gartlan was no longer an officer or employee
of the Company.
(6) As of January 20, 1995, Mr. Schnell was no longer an officer or employee
of the Company.
No individual named above received perquisites or non-cash compensation
exceeding the lesser of $50,000 or an amount equal to 10% of such person's
salary and bonus during the fiscal years ended January 31, 1995, 1994 and
1993.
The following table sets forth information concerning individual grants of
stock options made during the fiscal year ended January 31, 1995 to each of
the Named Executive Officers:
OPTION GRANTS IN FISCAL YEAR ENDED JANUARY 31, 1995
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
AT ASSUMED ANNUAL
RATES OF STOCK
PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM
-------------------------------------------------------------------- ----------------------
PERCENTAGE
NUMBER OF OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO EXERCISE
OPTIONS EMPLOYEES OR BASE
GRANTED IN FISCAL PRICE EXPIRATION
NAME (#) (1) YEAR ($/SH) DATE 5% ($)(2) 10% ($)(2)
---- ---------- ---------- -------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Paul Goldin............. 0 0.0 N/A N/A N/A N/A
Kenneth Goldin.......... 100,000(3) 23.7 8.25 -- (3) -- (3) -- (3)
50,000(3) 11.7 5.00 9/30/99 85,024 192,890
Michael A. Berkus....... 10,000(4) 2.4 9.75 (4) 33,159 75,227
40,000(4) 9.5 4.50 8/16/99 61,217 138,881
Michael A. Hoppman...... 10,000(5) 2.4 8.88 4/30/99 30,200 68,515
Robert H. Gartlan....... 0 0.0 N/A N/A N/A N/A
Scott Schnell........... 48,750(6) 11.6 3.88 1/31/98 40,763 87,785
</TABLE>
--------
(1) The options granted to Messrs. Goldin, Berkus and Hoppman were granted
under the Company's 1992 Stock Incentive Plan, with exercise prices equal
to the fair market value on the date of grant and a term of five years.
The options granted to Mr. Schnell were granted at an exercise price equal
to the fair market value on the date of grant under the Company's 1993
Non-Employee Stock Option Plan in accordance with his separation and
consulting agreement.
(2) The five percent and ten percent assumed rates of appreciation are
mandated by the rules of the Securities and Exchange Commission and do not
represent the Company's estimate or projection of future stock price or
performance.
(3) On June 10, 1994, Mr. Goldin was conditionally granted an option to
purchase 100,000 shares of the Company's Common Stock at an exercise price
of $8.25 per share. Effective September 30, 1994, the option was
cancelled, and Mr. Goldin was granted an option to purchase 50,000 shares
of Common Stock at an exercise price of $5.00 per share. The option to
purchase 50,000 shares may be exercised with respect to 25,000 shares
commencing October 1, 1995 and for the remaining 25,000 shares commencing
May 1, 1996, provided certain conditions are met.
(4) Effective April 17, 1995, the option to purchase 10,000 shares of Common
Stock was cancelled. The option to purchase 40,000 shares may be exercised
in 25% increments on each of March 1, 1995, September 1, 1995, September
1, 1996 and September 1, 1997, respectively.
(5) The option granted to Mr. Hoppman is subject to adoption by the Company's
shareholders of an amendment to increase the number of shares reserved for
issuance under the 1992 Stock Incentive Plan.
(6) The option may be exercised with respect to 24,375 shares commencing July
1, 1995 and for the remaining 24,375 shares commencing June 31, 1996.
6
<PAGE>
The following table sets forth information concerning each exercise of stock
options during the fiscal year ended January 31, 1995 by each of the Named
Executive Officers and the value of unexercised options held by each of the
Named Executive Officers as of January 31, 1995:
AGGREGATED OPTION EXERCISES IN FISCAL YEAR ENDED JANUARY 31, 1995
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS OPTIONS
AT FY-END (#) AT FY-END ($)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE (#) REALIZED (1)($) UNEXERCISABLE UNEXERCISABLE (2)
---- --------------- --------------- --------------- -----------------
<S> <C> <C> <C> <C>
Paul Goldin............. 0 0 96,000/0(3) 0/0
Kenneth Goldin.......... 30,000 $295,050 314,750/120,000(4) 75,179/0
Michael A. Berkus....... 0 0 0/40,000(5) 0/0
Michael A. Hoppman...... 0 0 28,000/10,000 0/0
Robert H. Gartlan....... 0 0 0/0 0/0
Scott Schnell........... 0 0 0/48,750 0/11,944
</TABLE>
--------
(1) This amount represents the market value of underlying securities on the
exercise date minus the exercise price of such options.
(2) This amount represents the market value of the underlying securities
relating to "in-the-money" options at January 31, 1995 minus the exercise
price of such options.
(3) The options are held by the Estate of Paul Goldin.
(4) Does not include options to purchase 100,000 shares, at an exercise price
of $8.25 per share, cancelled effective September 30, 1994.
(5) Does not include options to purchase 10,000 shares, at an exercise price of
$9.75 per share, cancelled effective April 17, 1995.
The following table sets forth information concerning repricings of options
held by executive officers of the Company during the last ten completed fiscal
years:
TEN-YEAR OPTION/SAR REPRICINGS
<TABLE>
<CAPTION>
NUMBER OF LENGTH OF
SECURITIES MARKET PRICE EXERCISE ORIGINAL
UNDERLYING OF STOCK AT PRICE AT OPTION TERM
OPTIONS/ TIME OF TIME OF REMAINING AT
SARS REPRICING OR REPRICING OR NEW DATE OF
REPRICED OR AMENDMENT AMENDMENT EXERCISE REPRICING OR
NAME DATE AMENDED (#) ($) ($) PRICE ($) AMENDMENT
---- ------- ----------- ------------ ------------ --------- ------------
<S> <C> <C> <C> <C> <C> <C>
Kenneth Goldin.......... 9/30/94 * $4.375 $8.25 $5.00 4.25 years
Chief Executive Officer
Michael Balser.......... 2/8/95 ** $ 4.00 ** $4.00 **
Vice President--
Licensing
</TABLE>
--------
* Effective September 30, 1994, Mr. Goldin's option to purchase 100,000 shares
of Common Stock at an exercise price of $8.25 per share, granted on June 10,
1994, was cancelled and replaced by an option to purchase 50,000 shares at
an exercise price of $5.00 per share.
** Effective February 8, 1995, Mr. Balser was granted an option to purchase
20,000 shares of Common Stock at an exercise price of $4.00 per share. The
following options were cancelled: (i) option to purchase 2,000 shares of
Common Stock at an exercise price of $17.00 per share (with approximately 2
years of the original option term remaining at date of cancellation); (ii)
option to purchase 4,600 sharers of Common Stock at an exercise price of
$8.38 per share (with approximately 2 1/2 years of the original option term
remaining at date of cancellation); and (iii) option to purchase 3,000
shares of Common Stock at an exercise price of $9.13 per share (with
approximately 3 1/2 years of the original option term remaining at date of
cancellation).
7
<PAGE>
EMPLOYMENT AGREEMENTS, COMPENSATORY ARRANGEMENTS
Effective January 1, 1994, the Company entered into a new employment
agreement with Kenneth Goldin which provides for his employment until December
31, 1996. Under this agreement, Mr. Goldin receives an annual base salary of
$375,000 and various benefits, including life and health insurance. In
addition, the agreement provides for an additional two year renewal period at a
salary of not less than $425,000, unless either party provides the other
written notice of its desire not to renew at least sixty (60) days prior to the
end of the term.
Prior to his employment by the Company, Mr. Berkus provided consulting
services to the Company pursuant to a consulting agreement dated April 11,
1994. Under the consulting agreement, Mr. Berkus was paid a $10,000 per month
consulting fee and $2,000 per month for automobile, housing and related
expenses. Pursuant to the consulting agreement, Mr. Berkus had the right to
receive multiple option grants if certain conditions were met. Effective April
17, 1995, all such options were cancelled.
On February 1, 1992, the Company entered into an employment agreement with
Mr. Hoppman. This agreement was most recently amended effective May 1, 1994,
and provides for Mr. Hoppman's employment until April 30, 1996. Under this
agreement, Mr. Hoppman received an annual salary of $82,000 prior to May 1,
1994. He will receive an annual salary of $105,000 and $110,000 for the years
commencing May 1, 1994 and 1995, respectively.
In September 1993, the Company acquired certain assets of Gartlan USA, Inc.
("GUSA") for $793,000 in cash and entered into a three year employment
agreement with the former owner of GUSA, Robert H. Gartlan. Under the
employment agreement, Mr. Gartlan was to receive salaries of $100,000, $120,000
and $135,000 during the first, second and third years, respectively, as well as
a royalty based on a percentage of sales of porcelain, ceramic and pewter
figurines, plates and similar collectibles (beginning at 4% of net sales and
decreasing to 1.5% of net sales in excess of $7,500,000), a percentage of net
sales of acquired inventory (40% of net sales), and a percentage of net sales
of existing contracts acquired in the purchase of GUSA (20% of net sales). As
of December 24, 1994, Mr. Gartlan was no longer an officer or employee of the
Company. Mr. Gartlan's employment agreement was terminated, and a consulting
agreement was executed pursuant to which Mr. Gartlan will provide certain
consulting services to the Company through September 1996. Under the terms of
the consulting agreement, the Company will pay Mr. Gartlan consulting fees of
$92,308 and $135,000 during the first and second years, respectively, of the
agreement, and will continue to pay Mr. Gartlan the royalty described above.
On February 10, 1995 the Company and Scott Schnell entered into a separation
and consulting agreement pursuant to which Mr. Schnell will provide consulting
services to the Company through January 1996. Under the terms of the agreement,
the Company will pay Mr. Schnell a severance payment in the amount of $185,000.
In addition, all options to purchase shares of the Company's Common Stock
granted to Mr. Schnell pursuant to the Company's 1992 Stock Incentive Plan were
cancelled, and Mr. Schnell was granted an option to purchase 48,750 shares of
the Company's Common Stock at an exercise price of $3.875 per share pursuant to
the Company's 1993 Non-Employee Stock Option Plan.
The Company's employment agreements with Kenneth Goldin and Michael A.
Hoppman contain provisions for payments of salary and benefits following a
change of control (as defined) of the Company. In general, under such
circumstances, each of Messrs. Goldin and Hoppman would be entitled to a cash
bonus equal to a percentage of his annual salary at the time the change occurs
(Mr. Goldin--100%; Mr. Hoppman--50%), whether or not he was terminated. In
addition, in the event of involuntary termination (as defined) following a
change of control, each of Messrs. Goldin and Hoppman would be entitled to a
lump sum cash payment equal to a percentage of the then present value of his
remaining contractual salary along with continued life, health and disability
insurance benefits for a stated period.
The agreement with Kenneth Goldin also provides, in the event of voluntary
termination following a change of control, for a lump sum cash payment equal to
50% of the then present value of his remaining contractual salary (but in no
event less than 50% of his annual salary), along with continued life, health
and disability insurance benefits and car allowances for one year.
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COMMITTEES OF THE BOARD OF DIRECTORS
The Company's Board of Directors has appointed an Audit Committee and a
Compensation Committee. The Company does not have a standing nominating
committee of the Board of Directors. The entire Board of Directors performs the
function of the nominating committee on an ad hoc basis.
Audit Committee. The members of the Audit Committee are Messrs. Lyons
(Chairman), Shabel, Shreiber and Yancey. The Audit Committee is responsible for
making recommendations for the selection of the Company's independent public
accountants and reviewing with them the scope, status and results of audit. The
Audit Committee also is responsible for reviewing accounting policies and
internal control procedures for preparation of financial statements and all
potential conflict-of-interest situations resulting from related party
transactions. The Audit Committee held four meetings during fiscal year 1995.
Compensation Committee. The members of the Compensation Committee are Messrs.
Lyons (Chairman), Shabel, Shreiber and Yancey. The Compensation Committee is
responsible for recommending remuneration arrangements for senior management
and directors, and for adoption of compensation plans in which officers and
directors are eligible to participate subject to approval of the entire Board
of Directors. The Compensation Committee held one meeting during fiscal year
1995.
THE FOLLOWING REPORT OF THE COMPENSATION COMMITTEE 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, AS
AMENDED, OR UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, EXCEPT TO
THE EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THIS INFORMATION BY
REFERENCE, AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH ACTS.
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COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors (the "Compensation
Committee"), which is currently composed of Messrs. Lyons, Shabel, Shreiber
and Yancey, and the Stock Option Committee of the 1992 Stock Incentive Plan
and the 1987 Stock Option Plan (the "Option Committee"), which is composed of
the same directors, are responsible for determining executive compensation.
The Compensation Committee is responsible for making recommendations with
respect to matters concerning base salaries and bonus remuneration of
executive officers of the Company. The Company's executive compensation
program is comprised of base salary, annual incentive compensation in the form
of cash bonuses, and long-term incentive compensation in the form of stock
options. For fiscal year 1995, base salaries were determined pursuant to
existing employment agreements, bonuses were determined by the Compensation
Committee, and stock option awards were determined by the Option Committee.
Compensation Goal. The goal of the Compensation Committee and Option
Committee is to establish and implement an executive compensation program that
will attract and retain superior management talent, recognize and reward
individual performances and align the financial interests of the executive
officers with those of its shareholders and the success of the Company. The
committees also consider compensation paid to executive officers by comparable
companies.
Base Salary. In determining the base salaries payable to executive officers
(whether by employment agreement or otherwise), the individual's expertise,
level of experience and level of responsibility, as well as the impact of such
individual on the profitability and future growth of the Company, were
considered.
Annual Incentive Compensation. Each existing employment agreement between
the Company and an executive officer provides for bonus compensation to be
awarded at the discretion of the Board of Directors. For purposes of
discretionary compensation, the Compensation Committee divided the executive
officers into various bonus pools based on areas of responsibility. Each bonus
pool, calculated as a pre-determined percentage of related pre-tax income,
could be earned by the pool's membership attaining certain financial goals,
including sales growth, earnings growth and appropriate related pre-tax
margins. The goals were set after analysis of the Company's annual
projections, its historical record and comparison with the results of a ten
company peer group selected by the Compensation Committee. The Compensation
Committee could allocate the pool's funds among the appropriate individuals
according to their individual contribution to the Company's growth and
profitability, but were not required to allocate all of each pool. If the
financial goals were not met, the Compensation Committee had the discretion to
grant bonus compensation to deserving individuals, provided that the aggregate
bonus compensation awarded was less than 50% of the bonus compensation which
would have been paid had the goals been met. None of the bonus pools attained
their financial goals during fiscal 1995, and the Compensation Committee did
not grant discretionary bonus compensation to any of the Named Executive
Officers.
Long-Term Incentive Compensation. The Company's 1992 Stock Incentive Plan,
as well as the 1987 Stock Option Plan under which options are no longer
granted, form the basis of the Company's long-term incentive plan for
executive officers and key employees. The specific objective of these plans is
to align executive and shareholder long-term interests by creating a direct
link between executive pay and shareholder return. The value of the stock
options awarded, which is an important component of executive compensation,
depends on the success of the Company and the price of its stock. Thus, such
awards serve as an incentive to executive officers to put forth their best
efforts on the Company's behalf.
Stock options previously granted under the 1987 Stock Option Plan, and stock
options granted periodically under the 1992 Stock Incentive Plan, generally
have five-year terms and include certain exercise restrictions and vesting
provisions. The exercise prices for options granted pursuant to these plans
equal the fair market value of the Common Stock as of the dates of grant. The
options are non-transferable, except by will or the laws of descent.
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Chief Executive Officer Compensation. Mr. Paul Goldin served as the
Chairman, Chief Executive Officer and President of the Company until his death
on May 21, 1994. During fiscal year 1995, he received a base salary of
$172,399 pursuant to his then existing employment agreement with the Company.
Mr. Kenneth Goldin succeeded Paul Goldin as Chairman, Chief Executive
Officer and President of the Company. During fiscal year 1995, Kenneth Goldin
received a base salary of $375,822 pursuant to his employment agreement. The
employment agreement had been approved by the outside Directors of the Company
in recognition of the dedication and loyalty demonstrated by Mr. Goldin in
prior years and in anticipation of the effort that would be expected of him
during the future fiscal years.
Effective September 30, 1994, the option to purchase 100,000 shares of the
Company's Common Stock at an exercise price of $8.25 per share granted to
Kenneth Goldin on June 10, 1994 was cancelled and replaced by an option to
purchase 50,000 shares at an exercise price of $5.00 per share. See "Ten-Year
Option/SAR Repricing" table above. The repricing was recommended in
recognition of Mr. Goldin's dedication, performance and assumption of
additional responsibilities after the death of Paul Goldin. The number of
options granted is consistent with market practices observed by the Option
Committee for chief executive officers of other companies of similar size and
industry. The ultimate value of these options will be determined by the actual
performance of the Company's stock price.
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STOCK PRICE PERFORMANCE GRAPH
The Securities and Exchange Commission requires a comparison of cumulative
total shareholder return for the Company with a relevant broad equity market
index and a peer group of publicly-traded companies over a five-year period.
Cumulative total shareholder return represents share value appreciation
assuming dividend reinvestment. The Common Stock of the Company is traded on
The National Association of Securities Dealers Automated Quotation National
Market System ("NASDAQ"). Set forth below is a graph comparing cumulative
total shareholder return on the Company's Common Stock with the NASDAQ Stock
Market (U.S.) index and a group of companies that the Company selected as a
peer group. The criteria applied in selecting peer companies for this purpose
consisted of publicly-traded companies that are perceived as competitors of
the Company (Marvel Entertainment Group, Inc. and The Topps Company, Inc.) and
the thirty-four (34) publicly-traded companies within the Company's NASDAQ
Major Industry Group of Wholesale Trade (two companies included in the peer
group analysis for fiscal year 1994 are no longer publicly traded).
[GRAPH APPEARS HERE]
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LEGAL PROCEEDINGS
In August 1994, eight separate purported class action lawsuits were filed
against the Company and certain individual defendants in the United States
District Court for the District of New Jersey (the "Court") alleging, inter
alia, securities fraud under the federal securities laws. On November 17,
1994, the plaintiffs in these lawsuits filed a consolidated amended class
action complaint. The Company filed its answer to the consolidated complaint
on January 12, 1995, denying all charges contained in the consolidated
complaint. In addition, a separate complaint containing the same allegations
was filed against the Estate of Paul Goldin, the Company's former Chairman of
the Board and Chief Executive Officer. All complaints were consolidated.
On June 26, 1995, the Court preliminarily approved the settlement of the
litigation in accordance with the terms contained in a Stipulation of
Settlement on file with the Court. Under the Stipulation, a settlement fund
has been established consisting of $3,000,000 in cash (which will be paid by
insurance) and $2,000,000 in freely tradeable and transferable shares of
Common Stock (the "Settlement Shares"). For purposes of the settlement, the
Court has preliminarily certified a class consisting of all persons who
purchased the Company's Common Stock during the period commencing October 29,
1993 and ending September 2, 1994. The Settlement Shares are valued at $4.6469
per share. If, prior to final approval of the settlement, the average for the
ten trading days preceding such approval of the daily average of the high and
low sales prices of the Company's Common Stock (the "Adjusted Average Price)
is less than $4.6469, the number of Settlement Shares will be increased to
yield a total value of $2 million, the number of shares to be determined by
dividing the Adjusted Average Price into $2 million. It is anticipated that
the Court will grant final approval of the settlement on October 19, 1995.
On October 4, 1994, Willie Mays initiated an arbitration proceeding with the
Company, claiming that the Company failed to perform certain contractual
obligations and seeking specific performance of the current contract. The
Company has asserted various counterclaims based on Mr. Mays' failure to
perform his contractual obligations. No hearing date has been selected for the
proceeding, which is being administered under the rules of the American
Arbitration Association in Monmouth County, New Jersey.
On February 14, 1995, Upper Deck Authenticated, Ltd. ("UDA") filed suit
against the Company and three unaffiliated entities in the United States
District Court for the Southern District of California alleging, inter alia,
that the Company had engaged in unfair competition and violated UDA's right to
use the indicia of certain athletes on sports memorabilia and collectibles.
The Company has responded to UDA's suit by denying all wrongdoing and filing
its own claims against UDA, Upper Deck Company and Richard McWilliam, charging
them with unfair competition, defamation, tortious interference with current
and prospective contractual relations and abuse of process.
The Company is involved in various other legal proceedings and claims
incident to the conduct of its business.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Barry Didinsky, the brother-in-law of Kenneth Goldin, was paid an aggregate
of $96,391 during the fiscal year ended January 31, 1995 pursuant to a then
existing employment agreement. This amount included $87,038 paid to Mr.
Didinsky as base salary and $5,103 in commissions paid on net sales of Company
products to certain regional cable outlets.
As of January 31, 1995, Mr. Didinsky was no longer employed by the Company.
In connection with the termination of Mr. Didinsky's employment, the Company
and Mr. Didinsky entered into a separation and consulting agreement pursuant
to which Mr. Didinsky provided certain consulting services to the Company
through March 31, 1995. Under the terms of said agreement, the Company paid
Mr. Didinsky severance and consulting fees in the amount of $24,000. In
addition, all options to purchase shares of the Company's Common Stock granted
to Mr. Didinsky pursuant to the Company's 1992 Stock Incentive Plan were
cancelled, and
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Mr. Didinsky was granted an option to purchase 7,500 shares of the Company's
Common Stock, at an exercise price of $3.00 per share, pursuant to the
Company's 1993 Non-Employee Stock Option Plan.
During fiscal 1995, Richard Yancey, a Director of the Company, received
$25,000 from the Company for financial advice rendered in accordance with the
terms of a consulting agreement with the Company.
In June 1994, the Company received proceeds of approximately $2,000,000 from
a key man life insurance policy on the life of Paul Goldin. In accordance with
Mr. Goldin's employment agreement, the Company is required to pay
approximately $900,000 to Mr. Goldin's estate. The amount payable to Mr.
Goldin's estate as of January 31, 1995 was $738,000.
SHAREHOLDER PROPOSALS
Shareholder proposals for the 1996 Annual Meeting must be submitted to the
Company by April 1, 1996 to receive consideration for inclusion in the
Company's Proxy Statement.
APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The accounting firm of BDO Seidman was the principal accountant for the
Company for the fiscal year ended January 31, 1995. Representatives of BDO
Seidman are expected to be present at the Annual Meeting and will have the
opportunity to make a statement and to respond to appropriate questions from
shareholders.
FINANCIAL STATEMENTS
Consolidated financial statements of the Company and its subsidiaries are
contained in the Company's Annual Report on Form 10-K for the fiscal year
ended January 31, 1995, which is being delivered to you herewith.
OTHER MATTERS
The Board of Directors is not currently aware of any other matter to be
transacted at the Annual Meeting. If, however, such other matters come before
the meeting, it is the intention of the persons named in the proxy to vote on
any such matters in accordance with the recommendation of the Board of
Directors.
Shareholders are urged to sign the enclosed proxy, which is solicited on
behalf of the Board of Directors, and return it in the enclosed envelope.
By Order of the Board of Directors
Patrick J. Wujcik,
Secretary
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THE SCORE BOARD, INC.
PROXY SOLICITED BY BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Kenneth Goldin and Allan R.
Lyons, and each of them, with full power of substitution, as proxies to
represent the undersigned and vote all the shares of Common Stock of The Score
Board, Inc. which the undersigned is entitled to vote at the Annual Meeting of
Shareholders to be held on September 18, 1995, at 1:30 P.M., E.D.T. at the
Sheraton Poste Inn, I-295 & Route 70, 1450 Route 70 West, Cherry Hill, New
Jersey 08034, and at any adjournments or postponements thereof, in the following
manner:
Management recommends that you vote WITH AUTHORITY on Proposal 1.
1. [_] WITH AUTHORITY to vote for all nominees listed below, except any
nominee(s) for whom authority to vote has been withheld by you in the manner
specified below.
Kenneth Goldin, Allan R. Lyons, Fred A. Shabel, Gerald B. Shreiber and Richard
C. Yancey
[_] WITHOUT AUTHORITY to vote for any nominee listed above.
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE OR NOMINEES, YOU
MUST WRITE THE NAME OR NAMES OF SUCH NOMINEE(S) IN THE FOLLOWING SPACE:
--------------------------------------------------------------------------------
2. IN ACCORDANCE WITH THEIR BEST JUDGMENT, the Proxy is authorized to vote upon
any other matter which may properly come before the Meeting.
(continued and to be signed on reverse side)
<PAGE>
(continued from other side)
THIS PROXY, IF PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED HEREIN, UNLESS
OTHERWISE DIRECTED, OR IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR
THE ELECTION OF THE FIVE DIRECTOR NOMINEES NAMED ON THE REVERSE SIDE.
Dated: __________________________ , 1995
----------------------------------------
Signature
----------------------------------------
Signature if held jointly
Please date and sign exactly as your
name appears hereon. If shares are
jointly held, all joint owners should
sign. Trustees and others signing in a
representative capacity should indicate
the capacity in which they sign. If the
signatory is a corporation or
partnership, sign the full corporate or
partnership name by a duly authorized
officer or partner.
