SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
TMS, 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] $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
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:
TMS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held January 17, 1997
Notice is hereby given that the Annual Meeting of Shareholders of
TMS, Inc., an Oklahoma corporation (the "Company"), will be held in Room
300 of the Centennial Student Lounge, Student Union Building, on the
campus of Oklahoma State University, Stillwater, Oklahoma, on Friday,
January 17, 1997, at 10:00 a.m., Central Standard Time, for the following
purposes:
(1) To elect five persons to serve as directors of the
Company;
(2) To approve and ratify the selection of KPMG Peat Marwick
LLP as independent auditors; and
(3) To consider and act upon any other matters which may
properly come before the Meeting or adjournments thereof.
Shareholders of record at the close of business on November 22,
1996 shall be entitled to notice of and to vote at the Meeting or any
adjournment thereof.
BY ORDER OF THE BOARD OF DIRECTORS,
Marshall C. Wicker, Secretary
December 11, 1996
<PAGE> 1
TMS, INC.
206 West Sixth Street
Stillwater, Oklahoma 74074
PROXY STATEMENT
FOR THE
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 17, 1997
This Proxy Statement is furnished to shareholders of TMS, Inc.,
an Oklahoma corporation (the "Company"), in connection with the
solicitation of proxies to be used at the Annual Meeting of Shareholders
(the "Meeting") to be held in Room 300 of the Centennial Student Lounge,
Student Union Building on the campus of Oklahoma State University,
Stillwater, Oklahoma on Friday, January 17, 1997, at 10:00 a.m., Central
Standard Time, or at any adjournment thereof. The persons named as
proxies in the enclosed form were selected by the Board of Directors of
the Company.
This Proxy Statement and the accompanying proxy are first being
mailed to shareholders on or about December 11, 1996. The Annual Report
to Shareholders, including financial statements for the fiscal year ended
August 31, 1996, has been previously mailed to shareholders.
GENERAL
Outstanding Shares and Voting Rights; Voting Procedures
At November 22, 1996, the Company had 13,297,604 shares of common
stock, $.05 par value ("Common Stock"), outstanding. The presence, in
person or by proxy, of the holders of at least a majority of the
outstanding shares of Common Stock is necessary to constitute a quorum of
such class at the Meeting. Shareholders have no cumulative voting
rights.
Any person signing and mailing the enclosed proxy may vote in
person if in attendance at the Meeting. Proxies may be revoked at any
time before they are voted by notifying the Secretary of such revocation,
in writing, at the Meeting, or by submitting a later dated proxy.
Shareholders are encouraged to vote on the matters to come before the
Meeting by marking their preferences on the enclosed proxy and by dating,
signing, and returning the proxy in the enclosed envelope. If a
preference is not indicated on a proxy, the proxy will be voted "FOR" the
nominees to serve as directors of the Company and "FOR" the ratification
and selection of independent auditors.
It is not anticipated that matters other than those described
above and in the Notice of Annual Meeting, to which this Proxy Statement
is appended, will be brought before the Meeting for action, but if any
other matters properly come before the Meeting, it is intended that votes
thereon will be cast pursuant to said proxies in accordance with the best
judgment of the proxy holders.
With respect to the tabulation of votes on any matter,
abstentions are treated as present or represented and entitled to vote at
the Meeting, while non-votes by nominees are treated as not being present
or represented and not entitled to vote at the Meeting.
Record Date
The close of business on November 22, 1996 has been fixed as the
record date for the determination of shareholders entitled to receive
notice of and to vote at the Meeting. Each outstanding share of Common
Stock is entitled to one vote on all matters herein.
<PAGE> 2
Expenses of Solicitation
The expenses of this solicitation of proxies will be borne by the
Company, including expenses in connection with the preparation and
mailing of this Proxy Statement and all documents which now accompany or
may hereafter supplement it. Solicitations will be made only by the use
of the mails, except that, if deemed desirable, officers and regular
employees of the Company may solicit proxies by telephone, telegraph, or
personal calls. It is contemplated that brokerage houses, custodians,
nominees and fiduciaries will be requested to forward the proxy
soliciting material to the beneficial owners of the Common Stock held of
record by such persons and that the Company will reimburse them for their
reasonable expenses incurred in connection therewith.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth information regarding the
beneficial ownership of shares of the Company's Common Stock as of
October 31, 1996, by each shareholder known to the Company to be a
beneficial owner of more than 5% of Company's Common Stock. Unless
otherwise indicated, the beneficial owner has sole voting and investment
power with respect to such shares of Common Stock.
<TABLE>
<CAPTION>
Amount and Nature Percent
Name and Address of Beneficial Ownership of Class (1)
<S> <C> <C>
Dana R. Allen 2,082,506 (2) 15.7%
433 Airport Boulevard,
Suite 414
Burlingame, California 94010
Theodore A. Walker 920,000 (3) 6.9%
P.O. Box 1580
Alvin, Texas 77512
James R. Rau, M.D. 717,000 (4) 5.4%
1203 South Hill Street
Alvin, Texas 77511
- -----------------------------
</TABLE>
(1) Shares of Common Stock subject to options currently exercisable or
exercisable on or before February 16, 1997 ("Currently Exercisable
Options"), are deemed outstanding for purposes of computing the
percentage for such person but are not deemed outstanding in
computing the percent of any other person.
(2) Includes 34,044 shares subject to currently exercisable options.
(3) Includes 56,000 shares which are held by Mr. Walker in joint tenancy
with his wife, Jerline, with whom he shares voting and investment
power.
(4) Includes 345,010 shares held by Dr. Rau's wife, Martha, with whom he
shares voting and investment power as to such shares, and 100,000
shares subject to Currently Exercisable Options.
As of the close of business on October 31, 1996, Cede & Co. owned
of record, but not beneficially, 4,820,646 shares (36.3%) of Common
Stock. Cede & Co., the nominee for the Depository Trust Company, holds
securities of record for participating financial institutions such as
banks and broker/dealers.
<PAGE> 3
Market for the Company's Common Stock
The Company's Common Stock is traded in the over-the-counter
market, and prices are quoted by the National Quotation Bureau,
Incorporated ("NQB") on the "pink sheets," and the NASD Non-Nasdaq OTC
Bulletin Board. The following table sets forth the quarterly range of
high and low bid prices of the Company's Common Stock for fiscal years
1995 and 1996. The quotations are inter-dealer prices without retail
mark-ups, mark-downs, or commissions and may not represent actual
transactions. The source of such quotations is the NQB.
<TABLE>
<CAPTION>
Bid Prices
----------
Fiscal 1995 High Low
----------- ---- ---
<S> <C> <C>
First Quarter $ 1/4 $ 1/8
Second Quarter 5/16 1/8
Third Quarter 1 1/8
Fourth Quarter 1 5/16
Fiscal 1996 High Low
----------- ---- ---
First Quarter $ 1-5/32 3/8
Second Quarter 1-1/2 5/8
Third Quarter 1-3/8 15/32
Fourth Quarter 7/8 5/8
</TABLE>
The Company has not declared nor paid any cash dividends since
its incorporation, nor does it anticipate that it will pay dividends in
the foreseeable future. Any earnings realized by the Company are
expected to be reinvested in the Company's business; however, the
declaration and payment of dividends in the future will be determined by
the Board of Directors in light of conditions then existing, including,
among others, the Company's earnings, its financial condition and capital
requirements (including working capital needs), and any arrangements
restricting the payment of dividends.
As of November 22, 1996, there were 745 record holders of Common
Stock, which is the only outstanding class of the capital stock of the
Company.
ELECTION OF DIRECTORS
General
Pursuant to the Bylaws of the Company, the shareholders are to
elect at the Meeting directors to hold office until the next Annual
Meeting of Shareholders and until their successors shall be elected and
shall qualify. The Board of Directors has fixed the number of directors
at five for the ensuing year.
The Board of Directors has no reason to believe that any nominee
will become unavailable. However, in the event that any of the nominees
should become unavailable, proxies solicited by the Board of Directors
will be voted for the election of substitute nominees or additional
nominees designated by the Board of Directors.
<PAGE> 4
PROXIES SOLICITED BY THE BOARD OF DIRECTORS, IF PROPERLY SIGNED
AND RETURNED, WILL BE VOTED "FOR" THE ELECTION OF THE FIVE NOMINEES LISTED
BELOW AS DIRECTORS OF THE COMPANY.
Information Concerning Nominees
Certain information as of October 31, 1996, concerning the
nominees to the Board of Directors of the Company, is set forth below
based upon information supplied by such persons. Unless otherwise
indicated, the beneficial owner has sole voting and investment power with
respect to such shares of Common Stock.
<TABLE>
<CAPTION>
Common Stock Beneficially Owned
-------------------------------
Director Number Percentage
Age Since of Shares of Class (1)
--- ----- --------- ------------
<S> <C> <C> <C> <C>
Dana R. Allen 43 1996 2,082,506 (2) 15.7%
James R. Rau, M.D. 67 1990 717,000 (3) 5.4%
Doyle E. Cherry 54 1988 255,903 (4) 1.9%
Maxwell Steinhardt 42 1995 382,155 (5) 2.9%
Marshall C. Wicker 70 1994 311,828 (6) 2.3%
All executive officers
and directors as a
group (9 persons) 4,278,418 (7) 32.2%
- -------------------
</TABLE>
(1) Shares of Common Stock subject to options currently exercisable or
exercisable on or before February 16, 1997 ("Currently Exercisable
Options"), are deemed outstanding for purposes of computing the
percentage for such person but are not deemed outstanding in
computing the percent of any other person.
(2) See footnote (2) to the table under the heading "Security Ownership
of Certain Beneficial Owners."
(3) See footnote (4) to the table under heading "Security Ownership of
Certain Beneficial Owners."
(4) Includes 20,000 shares held by Mr. Cherry in joint tenancy with his
wife, Theresa, with whom he shares voting and investment power; and
150,000 shares subject to Currently Exercisable Options.
(5) Shares held by Mr. Steinhardt in joint tenancy with his wife, Amanda,
with whom he shares voting and investment power, and 82,155 shares
subject to Currently Exercisable Options.
(6) Includes 163,399 shares held by Mr. Wicker in joint tenancy with his
wife, Bettye, with whom he shares voting and investment power.
(7) Includes 910,564 shares as to which directors and executive officers
share voting and investment power with others and 774,457 shares
subject to Currently Exercisable Options.
Information Concerning Nominees
The Company's nominees for the five directorships are listed below
with brief statements setting forth their principal occupations and other
biographical information.
<PAGE> 5
Maxwell Steinhardt has served as Chairman of the Board of Directors
and Chief Executive Officer of the Company since March 1996 and has
served as President since June 1993. From 1990 to June 1993 he was Vice
President, Marketing and Sales, of the Company. Mr. Steinhardt was
elected to the Company's Board of Directors in 1994. From October 1988
until joining the Company in August 1990, he served as Vice President of
Marketing and Sales for First Pacific Networks ("FPN"), a
telecommunications equipment company located in Sunnyvale, California.
From 1985 until joining FPN, Mr. Steinhardt was Managing Partner and
founder of CTPS, Inc., a technology consulting firm. Mr. Steinhardt
graduated from Princeton University in 1978 with a Bachelor of Arts
degree in political science.
Dana R. Allen has served as Executive Vice President and Director of
the Company since March 1996 and serves as President of the TMS West
Coast subsidiary operations. Mr. Allen was President of Sequoia Computer
Corporation ("Sequoia") from 1987 until it became a subsidiary of the
Company in March 1996. Prior to founding Sequoia in 1987, Mr. Allen was
Data Development Manager and Product Manager for Triad Systems, Inc., a
data services company. Prior to that time, Mr. Allen served as President
of H&A Auto Parts, an auto parts retailer/wholesaler.
Doyle E. Cherry has served as a Director of the Company since 1988.
Mr. Cherry is a chartered financial consultant who since 1961 has worked
in the insurance and securities industries and the actuarial, tax and
financial consulting fields. From 1982 to August 1993, Mr. Cherry also
served as President and Chief Executive Officer of First Market
Corporation and the First Market Group of Companies. Since July 1993, he
has served as President of Thiotech USA, Inc., a chemical manufacturer
and distributor located in Houston, Texas.
Dr. James R. Rau has served as a Director of the Company since 1990.
Dr. Rau practiced medicine from 1956 to 1985 in a private practice and
from 1985 to 1988 as a part-time physician with the Monsanto Company in
Houston, Texas. Since leaving Monsanto, Dr. Rau has managed his
financial and real estate investments.
Marshall C. Wicker has served as a Director of the Company since
1994. Since 1983, he has owned and operated Marwick Enterprises, which
is engaged in ranching and investments. Mr. Wicker is a Professional
Engineer and a member of the American Association of Petroleum Geologists
and Society of Exploration Geophysicists.
Executive Officers
The following sets forth the name and a description of the background
and principal occupation of each executive officer of the Company who is
not a director of the Company.
Arthur D. Crotzer, 44, has served in various capacities with the
Company since 1983, and is currently serving as Senior Vice President,
Engineering. Mr. Crotzer was awarded a Bachelor of Science degree in
math and physics from Austin Peay State University in 1973 and in 1975 he
earned a Master of Science degree in computer science from Oklahoma State
University.
Deborah D. Mosier, 29, joined the Company in 1995 as Controller of
Financial Operations and was appointed Chief Financial Officer in October
1996. Prior thereto, Ms. Mosier worked for six years in the audit
practice of KPMG Peat Marwick LLP. Ms. Mosier received her Bachelor of
Science Degree with a major in accounting from Oklahoma State University
and is a Certified Public Accountant.
<PAGE> 6
Richard P. Scanlan, 34, joined the Company in 1989 as a project
manager and technical consultant for customers. He served as Director of
Sales from 1992 to 1993, when he became Vice President of Sales. He
received a Bachelor of Science degree in business management from
Oklahoma State University in 1985, and in 1989 he received a second
Bachelor of Science degree in management science and computer systems
from Oklahoma State University. Prior to joining the Company, he spent
seven years in store management positions with Wal-Mart Stores, Inc.
Gail L. Bower, 44, joined the Company in 1991 as manager of West
Coast sales operations and was appointed Director of Marketing in 1993
and Vice President in 1994. In June 1996, Ms. Bower was named Vice
President of Business Development. Ms. Bower was formerly a product
manager for KnowledgeSet, a CD-ROM publishing software developer, and
manager of a Computerland franchise.
Board of Directors' Meetings
During the 1996 fiscal year, the Company's Board of Directors held
three meetings. All members of the Board of Directors attended more than
seventy-five percent (75%) of the Board of Directors' meetings.
Committees of the Board
The Board of Directors has a standing Compensation Committee. Such
committee is currently comprised of Dr. Rau and Messrs. Cherry,
Steinhardt and Wicker, and conducts all necessary business during the
regular meetings of the Board or through action by written consent. The
Compensation Committee administers the Company's stock option plans. The
Company does not have a standing nominating committee.
Certain Relationships and Related Transactions
No officer or director had transactions with or indebtedness to the
Company in excess of $60,000 during the fiscal year ended August 31,
1996.
Compliance with Section 16(a) of the Securities Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 and the rules
promulgated thereunder require that certain officers, directors and
beneficial owners of the Company's Common Stock file various reports with
the Securities and Exchange Commission (the "SEC"). Based solely upon a
review of such reports filed with the SEC, the Company believes that no
late reports were filed, for the fiscal year ended August 31, 1996.
<PAGE> 7
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the cash and noncash compensation for
each of the last three fiscal years awarded to or earned by the Chief
Executive Officers of the Company. During the last fiscal year, no
director or executive officer was granted any stock appreciation rights
or restricted stock awards.
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
------------------- ----------------------
Number of Securities
Name and Principal Position Year Salary Bonus Underlying Options
- -----------------------------------------------------------------------------
<S> <C> <C> <S> <C>
Maxwell Steinhardt (1) 1996 $110,667 -0- -0-
1995 $ 95,000 -0- -0-
1994 $ 83,750 -0- 82,155
J. Richard Phillips (1) 1996 $ 56,000 -0- -0-
1995 $ 84,000 -0- -0-
1994 $ 78,319 -0- 89,327
</TABLE>
(1) Mr. Steinhardt became Chief Executive Officer in March 1996, and Mr.
Phillips resigned as Chief Executive Officer and retired from the
Company at that time.
APPROVAL OF SELECTION OF AUDITORS
Subject to approval by the shareholders, the Board of Directors
has selected the firm of KPMG Peat Marwick LLP, certified public
accountants (the "Auditors"), as auditors of the Company for the year
ending August 31, 1997. Representatives of the Auditors are expected to
be present at the Meeting to respond to questions of shareholders.
The Company has been advised by the Auditors that neither the
firm nor any of its associates has any relationship with the Company or
any affiliate of the Company other than the usual relationship that
exists between independent public accountants and their clients. To the
knowledge of the Board of Directors, neither the Auditors nor any of its
associates has any direct or material indirect financial interest in the
Company and its subsidiaries in the capacities of promoter, underwriter,
voting trustee, director, officer, or employee.
During the past fiscal year, the Auditors have examined the
accounts of the Company and provided other services with respect to
certain filings of the Company with the Securities and Exchange
Commission.
The affirmative vote of the holders of a majority of the shares
of Common Stock present at the Meeting in person or by proxy and entitled
to vote is required to approve this proposal.
The Board of Directors recommends a vote "FOR" the selection of
KPMG Peat Marwick LLP as auditors of the Company for the current fiscal
year and the proxy, unless otherwise indicated thereon, will be voted
"FOR" the ratification of KPMG Peat Marwick LLP as auditors of the
Company for the current fiscal year.
<PAGE> 8
SHAREHOLDERS' PROPOSALS
Proposals by shareholders intended to be presented at the 1997
Annual Meeting of Shareholders must be received by the Company prior to
September 30, 1997, in order for the proposals to be included in the
proxy statement and proxy card relating to such meeting. It is suggested
that proposals be submitted to the Company by certified mail, return
receipt requested.
OTHER MATTERS
Management knows of no other business which is likely to be
brought before the Meeting. If other matters not now known to management
come before the Meeting, however, it is the intention of the persons
named in the accompanying proxy to vote in accordance with their best
judgment.
BY ORDER OF THE BOARD OF DIRECTORS,
MARSHALL C. WICKER, Secretary
December 11, 1996
A copy of the Company's Form 10-KSB Annual Report as filed with
the Securities and Exchange Commission will be furnished without charge
to shareholders on request to the Chief Financial Officer of the Company,
at its address stated herein.
TMS, INC.
206 West Sixth Street
Stillwater, Oklahoma 74074
This Proxy is solicited on behalf of the Board of Directors of TMS,
Inc. (the "Company"). The undersigned hereby appoints Doyle E. Cherry, Maxwell
Steinhardt, and James R. Rau, M.D., as proxies, each with the power to appoint
his substitute, and hereby appoints and authorizes them to represent and vote
as designated below, all of the shares of common stock of the Company held of
record by the undersigned on November 22, 1996, at the Annual Meeting of
Shareholders to be held on January 17, 1997, or any adjournment thereof.
1. ELECTION OF DIRECTORS [ ]FOR all nominees [ ]WITHHOLD AUTHORITY
listed below to vote for all
(except as marked nominees listed
to the contrary below) below
Dana R. Allen Doyle E. Cherry James R. Rau, M.D.
Maxwell Steinhardt Marshall C. Wicker
(INSTRUCTION): To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below).
- ------------------------------------------------------------------------------
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. PROPOSAL to approve and ratify the selection of KPMG Peat Marwick LLP as
the Company's independent auditors for the fiscal year ending
August 31, 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment
thereof.
(Continued and to be signed on the reverse side.)
This proxy, when properly executed, dated and delivered, will be
voted in the manner directed herein by the undersigned shareholder. If
no direction is made, this proxy will be voted FOR Proposals 1, 2 and 3.
Please sign exactly as name appears below.
When shares are held by joint tenants, both
should sign. When signing as attorney or as
executor, administrator, trustee or guardian,
please give full title as such. If corp-
oration, please sign in full corporate name
by president or other authorized officer. If
a partnership, please sign in partnership name
by authorized person.
Dated: , 19
------------------------------ ----
X
-------------------------------------------
(Signature)
X
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(Signature, if held jointly)
PLEASE SIGN, DATE AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
