<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
INFORMATION MANAGEMENT TECHNOLOGIES CORPORATION
- --------------------------------------------------------------------------------
(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/ $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:
Common Stock
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
N/A
------------------------------------------------------------------------
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):
N/A
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
N/A
------------------------------------------------------------------------
5) Total fee paid:
$125
------------------------------------------------------------------------
/ / 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:
N/A
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
N/A
------------------------------------------------------------------------
3) Filing Party:
N/A
------------------------------------------------------------------------
4) Date Filed:
N/A
------------------------------------------------------------------------
<PAGE>
INFORMATION MANAGEMENT TECHNOLOGIES CORPORATION
130 CEDAR STREET
FOURTH FLOOR
NEW YORK, NEW YORK 10006
(212) 306-3100
------------------------
NOTICE OF ANNUAL STOCKHOLDERS MEETING
TO BE HELD
DECEMBER 5, 1996
------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Information Management Technologies Corporation (the "Company") will be held at
The Company's Office 130 Cedar Street, New York, NY 10006 at 10:30 a.m., EST, on
Thursday, December 5 (the "Meeting"), for the following purposes:
(1) To elect four (4) Directors to serve for the ensuing year or until their
successors are elected and have been qualified.
(2) To ratify the selection of Mahoney Cohen Rashba & Pokart, CPA, PC, as
the independent public accountants for the Company's fiscal year ending
March 31, 1996.
(3) To ratify the Company's proposed 1997 Incentive Stock Option Plan.
(4) Such other business as may be properly brought before the Meeting or any
adjournment thereof.
Only those Shareholders who were Shareholders of record at the close of
business on October 31, 1996, will be entitled to notice of, and to vote
at the meeting or any adjournment thereof. If a shareholder does not
return a signed proxy card or does not attend the annual meeting and vote
in person, the shares will not be voted. Shareholders are urged to mark
the boxes on the proxy card to indicate how their shares are to be voted.
If a shareholder returns a signed proxy card but does not mark the boxes,
the shares represented by that proxy card will be voted as recommended by
the Board of Directors. The Company's Board of Directors solicits proxies
so each shareholder has the opportunity to vote on the proposals to be
considered at the annual meeting.
IMPORTANT
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE MARK, DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENVELOPE WHICH HAS BEEN PROVIDED,
IN THE EVENT YOU ARE ABLE TO ATTEND THE METING, YOU MAY REVOKE YOUR PROXY AND
VOTE YOUR SHARES IN PERSON.
<TABLE>
<S> <C>
July 29, 1996 By Order of the Board of Directors
New York, New York /s/ Joseph A. Gitto
---------------------------------------------
Joseph A. Gitto
President and Chief Financial Officer
</TABLE>
1
<PAGE>
INFORMATION MANAGEMENT TECHNOLOGIES CORPORATION
---------------------
DEFINITIVE PROXY STATEMENT
------------------------
FOR THE
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
DECEMBER 5, 1996
This proxy statement and the accompanying proxy card are furnished in
connection with the solicitation of proxies by the Board of Directors of
Information Management Technologies Corporation (the "Company") for use at the
Annual Meeting of Stockholders of the Company (the "Annual Meeting") to be held
at the Company's offices at 130 Cedar Street, New York, NY 10006, Fourth Floor
at 10:30 a.m. EST on December 5, 1996, and any adjournment or adjournments
thereof, for the purposes set forth in the accompanying Notice of Annual Meeting
of Stockholders. All stockholders are encouraged to attend the Annual Meeting.
Your proxy is requested, however, whether or not you attend in order to assure
maximum participation and to expedite the proceedings.
At the Annual Meeting, stockholders will be requested to act upon the
matters set forth in this Proxy Statement. If you are not present at the
meeting, your shares can be voted only when represented by proxy. The shares
represented by your proxy will be voted in accordance with your instructions if
the proxy is properly signed and returned to the Company before the Annual
Meeting. You may revoke your proxy at any time prior to its being voted at the
Annual Meeting by delivering a new duly executed proxy with a later date or by
delivering written notice of revocation to the Secretary of the Company prior to
the day of the Annual Meeting or by appearing and voting in person at the Annual
Meeting. It is anticipated that this proxy statement and accompanying proxy will
first be mailed to the Company's stockholders on or about November 1, 1996. The
Company's 1996 Annual Report to its stockholders on Form 10-K, filed with the
Securities and Exchange Commission June 28, 1996, is also enclosed and should be
read in conjunction with the matters set forth herein. The expenses incidental
to the preparation and mailing of this proxy material are being paid by the
Company. No solicitation is planned beyond the mailing of this proxy material to
stockholders.
Abstentions and broker non-votes will be counted towards determining whether
a quorum is present.
The Principal executive offices of the Company are located at 130 Cedar
Street -- Fourth Floor, New York, New York 10006. The telephone number is (212)
306-6100.
OUTSTANDING SHARES AND VOTING RIGHTS
The only security entitled to vote at the Annual Meeting is the Company's
Class A Common Stock. The Board of Directors, pursuant to the Bylaws of the
company, has fixed October 31, 1996, at the close of business, as the record
date of the determination of Stockholders entitled to notice of and to vote at
the Annual Meeting or at any adjournment or adjournments thereof. At July 17,
1996, there were 4,726,539 shares of Class A Common Stock outstanding and
entitled to vote at the Annual Meeting. Each share of a Class A Common Stock is
entitled to one vote at the Annual Meeting. A majority of the shares of Class A
Common Stock outstanding and entitled to vote which are represented at the
Annual Meeting, in person or by proxy, will constitute a quorum. As per the
By-laws of the Company, provided a quorum (majority) of issued and outstanding
shares entitled to vote are present in person or by proxy, a majority vote in
favor of a proposal is required for approval of an agenda item.
2
<PAGE>
ITEM 1: ELECTION OF DIRECTORS
The Board of Directors of the Company proposes that the Company's four
current directors standing for re-election be elected as directors to serve
until the next Annual Meeting of Stockholders and continuing until their
successors are elected and qualified. Unless authority is withheld on the proxy,
it is the intention of the proxy holder named on the proxy to vote the proxies
received by him for the four directors standing for re-election named below:
<TABLE>
<CAPTION>
CURRENT POSITION WITH COMPANY AS OF
NAME AGE FILING DATE DIRECTOR SINCE
- ----------------------- --- -------------------------------------------------- --------------
<S> <C> <C> <C>
Robert H. Oxenberg 46 Chairman of the Board, Director 1992(1)
Christopher D. Holbrook 45 Chief Executive Officer, Chief Operating Officer, 1995(2)
Director
Joseph A. Gitto, Jr. 33 President, Chief Financial Officer, Secretary 1995(3)
Bruce M. Arnstein 39 Director 1996(4)
</TABLE>
- ------------------------
(1) Resigned as Chief Executive Officer April 1996.
(2) Appointed Chief Executive Officer April 1996.
(3) Appointed President April 1996.
(4) Mr. Arnstein was appointed as a director of the Company in May 1996.
The executive officers of the Company are appointed by the Board of
Directors to serve until their successors are elected and qualified. The
directors of the Company are elected each year at the annual meeting of the
stockholders for a term of one year and until their successors are elected and
qualified. The following are brief descriptions of the directors, nominees and
executive officers of the Company.
ROBERT H. OXENBERG has served as director of the company since April 1992.
Mr. Oxenberg was appointed Chief Executive Officer of the Company in March of
1995. Mr. Oxenberg resigned as the Company's Chief Executive Officer in April
1996 but continues to serve as a member of the Company's Board of Directors. Mr.
Oxenberg is also a member of the Board of Directors of INSCI Corp.
("INSCI"), the Company's former majority owned subsidiary. Mr. Oxenberg is a
consultant based in Aspen, Colorado. From August 1984, to July 1991, Mr.
Oxenberg served as Manager of Corporate Investments for the Anschutz
Corporation, a Denver-based privately held corporation.
CHRISTOPHER D. HOLBROOK has served in various operations positions with the
Company from September 1989, through February 1995. Most recently, he served as
Executive Vice President of Operations. Mr. Holbrook has over 20 years of
experience in management, operations and systems. Mr. Holbrook was appointed as
President, Chief Operating Officer and Director of the Company on March 3, 1995.
Mr. Holbrook was appointed Chief Executive Officer of the Company in April 1996,
at which time he resigned his office as President of the Company.
JOSEPH A. GITTO, JR. has served as Controller of the Company from September
1993, and as accounting manager from April 1992 to September 1993. Mr. Gitto was
also Chief Financial Officer of EnviroSpan Safety Corp., an asbestos abatement
company from January 1988, to March 1992. Mr. Gitto has also held various
financial positions with Seltel, Inc., Shearson Lehman Brothers, and Dreyfus
Corp. Mr. Gitto was appointed Executive Vice President, Chief Financial Officer
and a member of the Board of Directors of the Company on March 3, 1995, and
President of the Company in April 1996.
BRUCE M. ARNSTEIN was appointed as a director in May 1996. Mr. Arnstein is
the Director of Information Consulting Services for Edward Issacs and Company,
LLP. Mr. Arnstein has over 18 years of consulting experience with companies that
include: BMA Consulting; David Berdon and Co.; Goelet Corporation; and Arthur
Andersen & Co. Mr. Arnstein currently serves as an executive committee member of
several companies.
3
<PAGE>
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the fiscal year ended March 31, 1996, there were three (3) meetings
of the Board of Directors, of which all Directors attended all meetings. The
Board of Directors establishes policies for the Company and reviews management
compensation standards and practices and administers the Amended and Restated
1987 Incentive Stock Option Plan, the Amended and Restated 1987 Non-Qualified
Stock Option plan, and the Directors Option Plan. The Board created a
compensation committee in Fiscal Year 1996 and appointed five (5) members to
serve on the Company's compensation committee. In addition, during Fiscal Year
1996, the Board of Directors established a five (5) person audit committee
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
COMPENSATION
The following table sets forth the compensation for each of the last three
completed fiscal years ending March 31, earned by the Chief Executive Officer
and each of the four most highly compensated executive officers and directors
whose individual remuneration exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL LONG-TERM ALL OTHER
COMPENSATION COMPENSATION COMPENSATION
----------------- --------------------- ------------
YEAR RESTRICTED
NAME AND PRINCIPAL ENDED STOCK OPTIONS/
POSITION MARCH 31 SALARY BONUS AWARDS SARS
- ---------------------------- -------- -------- ------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Christopher D. Holbrook (4) 1996 $140,000 $20,000 -0- 250,000 -0-
President & COO 1995 $142,020 $31,000 -0- 125,000 -0-
1994 $112,244 $22,000 -0- 18,750 -0-
Joseph A. Gitto, Jr. (5) 1996 $ 90,104 $17,500 -0- 250,000 -0-
Chief Financial Officer 1995 $ 82,348 $17,500 -0- 75,000 -0-
1994 $ 67,385 $ 5,000 -0- 3,125 -0-
Robert H. Oxenberg (6) 1996 $ 22,154 -0- -0- -0- -0-
1995 -- -- -- -- --
1994 -- -- -- -- --
David W. Grace (3) 1996 -0- -0- -0- -0- -0-
Former President & CEO 1995 $ 14,000 -0- -0- -0- -0-
1994 -0- -0- -0- -0- -0-
Gerald E. Dorsey (1) 1996 -0- -0- -0- -0- -0-
Former President & CEO 1995 $144,231 -0- -0- -0- -0-
1994 $152,436 $50,000 -0- -0- $177(2)
</TABLE>
- ------------------------
(1) Mr. Dorsey served as Chief Executive Officer of the Company from January
1991 to September 1994. Mr. Dorsey resigned as a director in September 1994.
(2) Represents the payments of premiums on life insurance policies.
(3) Mr. Grace served as Chief Executive Officer of the Company from September
1994 to March 1995, and as a Director from September 1992 to November 1995,
at which time Mr. Grace elected not to stand for re-election as a director.
(4) Mr. Holbrook was appointed as Chief Executive Officer in April 1996, at
which time he resigned his office as President.
(5) In April 1996, Mr. Gitto was appointed President of the Company.
(6) In April 1996 Mr. Oxenberg resigned as Chief Executive Officer but continues
to serve as a member of the Company's Board of Directors.
4
<PAGE>
STOCK OPTION GRANTS
The following table sets forth information concerning the grant of stock
options to the Company's executive officers during the fiscal year ended March
31, 1996.
OPTIONS GRANTS LAST YEAR
<TABLE>
<CAPTION>
PERCENT OF TOTAL
SHARES POTENTIAL REALIZED
SHARES UNDERLYING VALUE AT ASSUMED
UNDERLYING OPTIONS GRANTED PER SHARE ANNUAL
OPTIONS TO EMPLOYEES IN EXERCISE EXPIRATION RATES OF STOCK
GRANTED FISCAL YEAR PRICE (1) DATE PRICE APPRECIATION
----------- ------------------- ----------- ---------- ---------------------
<S> <C> <C> <C> <C> <C>
Christopher D. Holbrook 250,000 29% 1.88 3/3/2000 --
Joseph A. Gitto, Jr. 250,000 29% 1.88 3/3/2000 --
Robert H. Oxenberg -0- -0- -0- -- --
</TABLE>
OPTIONS EXERCISES AND HOLDINGS
The following table sets forth information concerning the exercise of
options during the last fiscal year and unexercised options held by the
Company's officers and directors as of the end of the fiscal year:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SHARES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN THE MONEY OPTIONS AT
SHARES MARCH 31, 1996 MARCH 31, 1996 (2)
ACQUIRED ON VALUE -------------------------- ----------------------------
EXERCISE REALIZED (1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
--------------- --------------- ----------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Christpher D. Holbrook -0- -0- 203,750 216,667 -0- $ 420,417
Joseph A. Gitto, Jr. -0- -0- 103,125 200,000 -0- $ 353,125
Robert Oxenberg -0- -0- 83,633 -- -0- $ 83,623
</TABLE>
- ------------------------
(1) Calculated by multiplying the number of shares underlying options by the
difference between the average of the closing bid and ask price of the
Common Stock as reported by NASDAQ on the date of exercise and the exercise
price of the options.
(2) Calculated by multiplying the number of shares underlying options by the
difference between the average of the closing bid and ask price of the
Common Stock as reported by NASDAQ on March 31, 1996, and the exercise price
of the options.
REMUNERATION OF NON-MANAGEMENT DIRECTORS
Each member of the Board of Directors who is not an officer or employee of
the Company will be entitled to participate in the Directors Option Plan
described herein, plus be entitled to reimbursement for travel and other
expenses directly related to his activities as a Director. Commencing July 15,
1994, the Company has agreed to pay $1,000 for each meeting attended by a
non-employee Director up to a maximum of $4,000 per year.
STOCK OPTION PLANS
1987 NON-QUALIFIED STOCK OPTION PLAN
The Company's 1987 Non-Qualified Stock Option Plan (the "NQSO Plan") was
adopted by the Board of Directors and approved by the stockholders in August
1987, and amended by the stockholders in May 1995. The NQSO Plan provides for
the granting of options to purchase shares of the Company's Class A Common Stock
to key persons whom, in the judgment of the Compensation Committee of the Board
of Directors (the "Committee"), the Company relies on the successful
5
<PAGE>
conduct of its business. Directors of the Company who are not employees of the
Company are not eligible to participate in the NQSO Plan. There are 4,000,000
shares reserved for issuance under the NQSO Plan, as amended.
The exercise price of options granted under the NQSO Plan are determined by
the Committee in its sole discretion, provided that it may not be less than the
par value of the shares or fifty percent of the fair market value of the shares
on the date of grant. The Committee determines the time periods during which
options granted under the NQSO Plan may be exercised, although in no event shall
any option granted under the NQSO Plan have an expiration date later than 10
years from the date of its grant. As of July 11, 1996, options to acquire a
total of 1,415,772 shares were outstanding or approved for grant under the NQSO
Plan at an average exercise price ranging from $1.00 to $9.89 per share after
giving effect to the Company's four (4) for one (1) reverse stock split which
was enacted on June 14, 1995. The NQSO Plan will continue in effect for a term
of 10 years unless terminated earlier by the Board of Directors.
INCENTIVE STOCK OPTION PLAN
The Company's Incentive Stock Option Plan (the "ISO Plan") was adopted by
the Board of Directors and approved by the stockholders in August 1987, and
amended by the stockholders in May 1995. There are 3,000,000 shares reserved for
issuance under the ISO Plan as amended. The ISO Plan provides for the granting
to key employees of "Incentive stock options" within the meaning of Section 422
of the Internal Revenue Code of 1986 (the "Code"). All employees, including
officers and employee directors of the Company, are eligible under the ISO Plan,
which is intended to be used to attract and retain key personnel.
The ISO Plan is administered by the Committee, which determines the terms of
options granted, including the exercise price, dates and number of shares
subject of the option. The exercise price of all options granted under the ISO
Plan must be at least equal to the fair market value of the shares on the date
of grant, and the term of each option may not exceed 10 years. With respect to
any participant who may own more than 10% of the Company's outstanding voting
shares, the exercise price of any incentive stock option must be at least equal
to 110% of the fair market value of the Class A Common Stock on the date of
grant and the term may be no longer than five years.
As of July 11, 1996, options to acquire a total of 1,345,661 shares were
outstanding or approved for grant under the ISO Plan at an exercise price
ranging from $1.25 to $5.85 per share after giving effect to the Company's four
(4) for one (1) stock split which was enacted on June 14, 1995. The ISO Plan
will continue in effect for a term of 10 years from date of inception unless
terminated earlier by the Board of Directors.
DIRECTORS OPTION PLAN
The Company's Directors Option Plan (the "Directors Plan") was adopted by
the Board of Directors in October 1988, and amended by the stockholders in May
1995. A total of 1,500,000 shares of Class A Common Stock have been reserved for
issuance under the Directors Plan as amended. As of July 11, 1996, options to
acquire a total of 15,000 shares were outstanding or approved for grant under
the directors options plan at an exercise price of $13.00. The Directors option
plan provides that director stock options will be granted only on the date of
the Annual Stockholders meeting in each even calendar year. The purpose of the
Directors Plan is to retain the service of qualified non-officer, or
non-employee, directors who are considered essential to the sustained progress
of the Company.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Robert Oxenberg, who became a member of the Company's Board of Directors in
April 1992, has acquired securities offered by the Company and INSCI in several
private placements. See "Securities Ownership of Certain Beneficial Owners and
Management." Effective October 1992, the Company signed a three-year consulting
agreement with Mr. Oxenberg, pursuant to which Mr. Oxenberg provides consulting
services to the Company and INSCI, the Company's former majority-owned
subsidiary. Mr. Oxenberg also serves as a member of the Board of Directors of
INSCI. This consulting
6
<PAGE>
agreement was terminated in November 1993. Mr. Oxenberg was granted a five year
option to acquire 10,000 shares of common stock of INSCI at an exercise price of
$7.00 per share. Subsequently, the Company agreed to enter into a new consulting
agreement with Mr. Oxenberg for one year commencing April 1996.
D.H. Blair Investment Banking Corp. ("Blair") and its affiliates have
granted a voting proxy in the shares which it owns or shall acquire during the
term of such proxy to the Chief Executive Officer of the Company, and his
successors. The voting agreement terminates in February 1999, and is suspended
during any period when Blair or its affiliates are not "market makers" for the
Company's securities.
Mr. Pierce Lowrey, Jr., has granted a voting proxy in the shares which he
owns or shall acquire during the term of such proxy to Christopher D. Holbrook
and his successors as Chief Executive Officer of the Company, and his
successors. The voting agreement terminates in March, 2004.
On July 15, 1994, Mr. Norman R. Malo and Mr. George T. Olmstead tendered
their resignations as members of the Company's Board of Directors. The Company
has entered into consulting agreements with each of Messrs. Malo and Olmstead
pursuant to which the Company granted an aggregate of 22,500 non-statutory stock
options to each of Messrs. Malo and Olmstead under the Company's Non-Qualified
Stock Option Plan. The consulting agreements provide that each of Messrs. Malo
and Olmstead will provide consulting services to the Company for a three (3)
year term. The non-qualified stock options granted to each of Messrs. Malo and
Olmstead include 7,500 shares exercisable until December 31, 1996, at an
exercise price of $10.00 per share, 7,500 shares exercisable until December 31,
1996, at an exercise price of $8.00 per share and 7,500 shares exercisable until
December 31, 1997, at an exercise price of $13.00 per share.
401(K) PLAN
In December 1994, the Company terminated its 401(K) plan. In January 1996,
the Company established a new 401(K) plan covering all eligible employees.
Contributions to the plan by the Company are based on a discretionary matching
contribution of the employees' deferred compensation. Employee contributions are
limited to 15% of annual salary. There were no employer contributions to the
plan for the fiscal year ended March 31, 1996.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
The Company to the best of its knowledge has not received a copy of any Form
5 with respect to the fiscal year ending March 31, 1996, or any representations
from any officer, director or 10% shareholder of the company that such Form 5
was required to be filed.
7
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, to the best knowledge of the Company, as of
March 31, 1996, certain information with respect to (1) beneficial owners of
more than five percent (5%) of the outstanding Class A Common Stock of the
Company; (2) beneficial ownership of shares of the Company's Class A Common
Stock by each director and named executive; and (3) beneficial ownership of
shares of Class A Common Stock of the Company by all directors and officers as a
group.
<TABLE>
<CAPTION>
NAME OF BENEFICIALLY PERCENT OF
BENEFICIAL OWNER OWNED (1)(2)(4) CLASS OWNED (2)
- -------------------------------------------------------------------------------- --------------- --------------------
<S> <C> <C>
Robert Sachs.................................................................... 479,567 5%
Robert Oxenberg (3)............................................................. 612,865 *
Christopher D. Holbrook......................................................... 420,417 *
Joseph A. Gitto, Jr............................................................. 353,125 *
Directors and Executive Officers as a group (4 persons)......................... 1,386,407 13%**
</TABLE>
- ------------------------
*Indicates percentage less than one percent (1%)
**All current Directors, Executive Officers and Nominees
(1) Unless otherwise noted, all shares are beneficially owned and the sole
voting and investment power is held by the persons indicated.
(2) Based upon the aggregate total of all shares of Class A Common Stock
currently issued and outstanding in addition to shares issuable upon
exercise of options or warrants currently exercisable or becoming
exercisable within 60 days following the date of this report and which are
held by the individuals named on the table and shares of the Company's 12%
convertible preferred stock that is currently convertible.
(3) D.H. Blair has entered into a voting agreement granting the voting rights of
shares to Robert H. Oxenberg and his successors as Chief Executive Officer
of the Company. Also includes shares of Class A Common Stock owned by Mr.
Oxenberg and his successors as Chief Executive Officer of the Company.
(4) Does not include the portions of options to purchase shares which are not
currently exercisable or will become exercisable between the date hereof and
sixty days following the date hereof.
THE BOARD OF DIRECTORS RECOMMEND THAT THE STOCKHOLDERS VOTE "FOR" THE
ELECTION OF THE FOUR (4) NOMINATED DIRECTORS.
ITEM 2: RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Mahoney Cohen Rashba & Pokart, CPA, PC,
as the Company's independent auditors for the fiscal year ended March 31, 1996.
Representatives of Mahoney Cohen Rashba & Pokart, CPA, PC, are expected to be
present at the Annual Meeting.
The affirmative vote of a majority of the outstanding voting shares of the
Company's Class A Common Stock is required for the ratification of this
selection.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" RATIFICATION
OF SELECTION OF INDEPENDENT AUDITORS.
ITEM 3: RATIFICATION OF THE COMPANY'S PROPOSED 1997 INCENTIVE STOCK OPTION PLAN
The Board of Directors has proposed a 1997 Incentive Stock Option Plan. It
is recommended that 2,500,000 shares of the Company's Class A Common Stock be
authorized and reserved for issuance under the proposed Plan. The term of the
proposed Plan will be for a period of ten (10) years from the date of inception.
8
<PAGE>
The proposed Plan will provide for the granting of incentive stock options
to all eligible employees of the Company including officers and employee
directors, whose services are considered valuable to the Company and who qualify
under the Plan. The proposed Plan will provide for the granting of incentive
stock options within the meaning of Section 422 of the Internal Revenue Code of
1986 (the "Code").
The administration of the proposed Plan will be under the supervision of
Company's Compensation Committee.
The exercise price of all options under the proposed plan will be determined
at the time of grant, but in no event shall be less than the fair market value
of the Class A Common Stock at the time of the grant.
The Compensation Committee will recommend to the Board of Directors the
terms of proposed options to be granted under the Plan, including the dates and
number of shares subject to the options. The Board will make the final
determination on proposed option grants.
The Board of Directors believes that shareholder ratification of the
proposed 1997 Incentive Stock Option Plan will be in the Company's best
interest, as the existing Stock Option Plan will expire in 1997. The Board of
Directors believe that the proposed Plan will enable the Company to attract new
key employees and to maintain existing key employees in the Company, as the
current plan is not adequate for the Company's requirements.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCK HOLDERS VOTE "FOR" RATIFICATION
OF THE PROPOSED 1997 INCENTIVE STOCK OPTION PLAN.
DEADLINE FOR SUBMITTING STOCKHOLDER PROPOSALS
Rules of the Securities and Exchange Commission require that any proposal by
a stockholder must be received by the Company for consideration at the 1997
Annual Meeting of Stockholders must be received by the Company no later than
March 7, 1997, if any such proposal is to be eligible for inclusion in the
Company's proxy materials for its 1997 Annual Meeting. Under such rules, the
Company is not required to include stockholder proposals in its proxy materials
unless certain other conditions specified in such rules are met.
OTHER MATTERS
Management of the Company is not aware of any other matter to be presented
for action at the Annual Meeting other than those mentioned in the Notice of
Annual Meeting of Stockholders and referred to in this Proxy Statement.
VOTING PROCEDURES
Under Delaware law, each holder of record is entitled to vote the number of
shares owned by the shareholder for any agenda item. There are no cumulative
voting rights for the shareholders of the Company.
The Company is not aware of any other agenda item to be added to the agenda
as it has not been informed by any stockholders of any request to do so.
There are no matters on the agenda which involve rights of appraisal of a
stockholder.
BY ORDER OF THE BOARD OF DIRECTORS
__________/S/ JOSEPH A. GITTO_________
JOSEPH A. GITTO
PRESIDENT AND CHIEF FINANCIAL OFFICER
NEW YORK, NEW YORK
JULY 29, 1996
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