SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
[(Amendment No. ___)]
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
GREENSTONE ROBERTS ADVERTISING, INC.
(Name of Registrant as Specified in Its Charter)
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(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 previously paid 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:--------------------------------------------------------
<PAGE>
GREENSTONE ROBERTS ADVERTISING, INC.
----------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
GREENSTONE ROBERTS ADVERTISING, INC. (the "Company") will be held at One
Huntington Quadrangle, Melville, New York 11747, on April 3, 1997 at 10:00 a.m.,
New York time, for the following purposes:
1. To elect three members to the Board of Directors for a term of two
years and until their respective successors shall have been duly
elected and shall have qualified.
2. To approve the appointment of Ernst & Young LLP as auditors for the
Company's 1997 fiscal year.
3. To consider and act upon any other business as may properly be
brought before the meeting, and any adjournments or postponements
thereof, in connection with the foregoing or otherwise.
Shareholders of record at the close of business on February 21, 1997 will
be entitled to notice of and to vote at the meeting.
By order of the Board of Directors,
Anthony V. Curto
Secretary
Dated: Melville, New York
February 28, 1997
If you do not expect to be present at the meeting and wish your shares to
be voted, please date, sign and mail the accompanying form of proxy as promptly
as possible in the enclosed envelope addressed to the Company's Transfer Agent.
<PAGE>
GREENSTONE ROBERTS ADVERTISING, INC.
ONE HUNTINGTON QUADRANGLE
MELVILLE, NEW YORK 11747
----------------------------
PROXY STATEMENT
----------------------------
The accompanying proxy is solicited by the Board of Directors of Greenstone
Roberts Advertising, Inc., a New York corporation (the "Company"), on behalf of
the Company for use at the Annual Meeting of Shareholders to be held at One
Huntington Quadrangle, Melville, New York 11747, on April 3, 1997 at 10:00 a.m.,
New York time, and any adjournments or postponements thereof, at which
shareholders of record on February 21, 1997 will be entitled to vote. On
February 21, 1997, the Company had outstanding 7,474,418 shares of Common Stock,
par value $.01 per share (the "Common Stock"). The Common Stock is the only
outstanding class of voting securities of the Company. Each shareholder will be
entitled to one vote for each share of Common Stock held.
The costs of soliciting proxies will be borne by the Company. Such costs
will include charges by brokers and other custodians, nominees and fiduciaries
for forwarding proxies and proxy material to beneficial owners of shares.
Solicitation may be made by mail, personally, by telephone or telegraph, by
officers, directors and regular employees of the Company; such persons will not
be separately compensated for such solicitation.
The shares represented by an executed form of the accompanying proxy will
be voted as directed with respect to the election of Directors or, if no
direction is indicated, will be voted in favor of the election as Directors of
the nominees listed below. Each proxy executed and returned by a shareholder may
be revoked at any time thereafter except as to any matter or matters upon which,
prior to such revocation, a vote shall have been cast pursuant to the authority
conferred by such proxy. Subject to the foregoing, a shareholder may revoke his
proxy by executing another proxy at a later date, by notifying the Secretary of
the Company in writing of his revocation or by attending and voting at the
Annual Meeting.
If voting by proxy with respect to the election of Directors, shareholders
may vote in favor of all nominees, withhold their votes as to all nominees or
withhold their votes as to specific nominees. With respect to each other
proposal that comes before the shareholders at the Annual Meeting, shareholders
may vote For the proposal, vote Against the proposal or Abstain from voting with
respect to the proposal. Assuming a quorum is present, (i) the affirmative vote
of a plurality of the votes cast by the holders of the shares of Common Stock
entitled to vote will be required to act with respect to the election of
Directors and (ii) the affirmative vote of a majority of the votes cast by the
holders of the shares of Common Stock entitled to vote will be required to act
on all other proposals that come before the Annual Meeting. Abstentions and
broker non-votes (when a nominee holding shares for a beneficial owner has not
received voting instructions from the beneficial owner with respect to a
particular matter and such nominee does not possess or choose to exercise
discretionary authority with respect thereto) will be included in the
determination of the number of shares of Common Stock present at the meeting for
quorum purposes. However, abstentions and broker non-votes will not be included
in the tabulations of votes cast on proposals presented to shareholders.
There is being mailed herewith to each shareholder of record the Company's
Annual Report on Form 10-K without exhibits, for the fiscal year ended October
31, 1996. The date of this Proxy Statement is the approximate date on which the
Proxy Statement and the accompanying form of proxy were first sent or given to
shareholders.
<PAGE>
ELECTION OF DIRECTORS
Three Directors are to be elected at the Annual Meeting, each Director to
hold office until the 1999 Annual Meeting of Shareholders and until his
respective successor shall have been duly elected and shall have qualified. The
Board of Directors has nominated the persons whose names appear below. It is the
intention of the persons named in the accompanying proxy to vote the proxies in
favor of the election of the nominees named below if no direction to the
contrary is given. The Board of Directors has no reason to believe that any of
those named will be unavailable. If any of those named should become
unavailable, discretionary authority is reserved to vote for a substitute.
The Directors are divided into two classes and hold office until the second
succeeding Annual Meeting of Shareholders following the election of their
respective class and the qualification of their successors. None of the officers
or Directors are related to one another.
Information as to Nominees for Election as Directors
First
Name Age Position Elected
Gary C. Roberts ........ 58 President, Chief Operating 1988
Officer and Director
Anthony V. Curto ....... 60 Secretary and Director 1988
Martin S. Sussman ...... 59 Director 1991
Gary C. Roberts has been President, Chief Operating Officer and Director of
the Company since December 1988. Mr. Roberts served as Executive Vice President
of the Company from January 1988 until December 1988. From January 1983 until
December 1987, Mr. Roberts served as Executive Vice President, Chief Operating
Officer and Partner at Slater Hanft Martin (a New York, New York based
advertising agency). From January 1970 to December 1982, Mr. Roberts served as
Executive Vice President and group head at Wells Rich Greene (a New York, New
York based advertising agency). Mr. Roberts received his Bachelor of Science
degree in Marketing from New York University in 1960.
Anthony V. Curto has been Secretary of the Company since August 25, 1994.
Mr. Curto has been a partner with the law firm of Curto, Barton & Alesi, P.C.
since 1992. For more than 5 years prior thereto, he was a partner with the law
firm of Meyer, Suozzi, English & Klein, P.C. Mr. Curto is admitted to practice
law in the State of New York and obtained his J.D. degree from New York Law
School in 1960. He has been a Director and Counsel to Yoo Hoo, Inc. and C&C
Corp. Mr. Curto also has been an adjunct professor at the business school of
Hofstra University and serves as a Trustee of the South Street Seaport Museum.
Martin S. Sussman has been a partner with the law firm of Seltzer, Sussman
& Habermann since forming the firm in 1974. Mr. Sussman specializes in corporate
and corporate tax issues. He is a Director of Instrument Systems Corporation, an
American Stock Exchange listed company, and Griffon Corporation, a New York
Stock Exchange listed company. He is counsel to the law firm of Blau, Kramer,
Wactlar, Lieberman & Satin, P.C. He was admitted to the New York State Bar in
June 1961 and obtained his LL.B. and LL.M. degrees from New York University in
1960 and 1961, respectively.
Ronald M. Greenstone founded the Company in 1972 and has been Chairman of
the Board of Directors, Chief Executive Officer and a Director for more than the
past five years. Mr. Greenstone served as President of the Company from December
1988 to December 1991. Prior to founding the Company, Mr. Greenstone served as
Vice President in charge of account services for the former SH Goldstein
Advertising (Great Neck, New York).
Leonard Schrift has served as Senior Vice President, Chief Financial
Officer, Treasurer and Director of the company since March 1996. Mr. Schrift has
been a Director of the com-pany since 1988. He had served for more than the past
five years as President and Chief Executive Officer of Ballen Booksellers
International, Inc., a company located in Hauppauge, New York, engaged in
distributing books to academic, research and medical libraries.
Richard Projain has been a Principal of Kimba Consulting, Inc., a
management consulting firm since January 1994. Mr. Projain served as a freelance
consultant between November 1991 and December 1993. For the more than five years
prior thereto, he was President, Chief Executive Officer and a Director of
Electrosound Group, Inc. Electrosound was engaged in the business of providing
services and products to the recorded music industry.
Information as to Directors Whose Terms Expire at the 1998 Annual Meeting
First
Name Age Position Elected
Ronald M. Greenstone .... 56 Chairman of the Board, Chief 1972
Executive Officer and Director
Leonard Schrift ......... 56 Senior Vice President, Chief 1988
Financial Officer, Treasurer
and Director
Richard Projain ......... 61 Director 1988
Compensation of Directors
Each Director who is not an executive officer of the Company is paid $1500
for each regular or special meeting of the Board of Directors attended.
Committees of the Board of Directors
The Board of Directors of the Company has established the following
committees:
(i) Executive Committee -- the duties of the Executive Committee are
to exercise all functions of the Board of Directors in the intervals
between meetings of the Board of Directors. The members of the Executive
Committee during the Company's recently completed fiscal year were Messrs.
Greenstone, Projain and Roberts.
(ii) Audit Committee -- the duties of the Audit Committee include
recommending the engagement of independent auditors, reviewing and
considering actions of management in matters relating to audit functions,
reviewing with independent auditors the scope and result of their audit
engagement, reviewing reports from various regulatory authorities,
reviewing the system of internal controls and procedures, and reviewing the
effectiveness of procedures intended to prevent violations of law and
regulation. The members of the Audit Committee during the Company's
recently completed fiscal year were Messrs. Curto, Projain and Sussman.
(iii) Stock Option Plan Committee -- the duties of the Stock Option
Plan Committee are to administer the Company's Option Plan (as defined
herein), including determining which employees of the Company and its
subsidiary will be granted options to purchase shares of Common Stock of
the Company and the number of shares of Common Stock subject to each option
granted. The members of the Stock Option Plan Committee during the
Company's recently completed fiscal year were Messrs. Curto, Projain and
Sussman.
(iv) Compensation Committee -- the duties of the Compensation
Committee are to recommend to the Board remuneration for officers of the
Company, and to recommend the establishment of and monitor a compensation
and incentive program for all salaried personnel of the Company. In
addition, the Compensation Committee will review compensation paid to
non-employee shareholders of the Company owning at least 1% of the
outstanding Common Stock. The members of the Compensation Committee during
the Company's recently completed fiscal year were Messrs. Curto, Projain
and Schrift.
Meetings of Directors
During the fiscal year ended October 31, 1996, three meetings of the Board
of Directors, one meeting of the Audit Committee, no meeting of the Compensation
Committee and one informal meeting of the Stock Option Plan Committee were held.
No Director attended less than 67% of the meetings of the Board held while he
was a member, and no Director attended less than 67% of the meetings held by all
committees on which he served.
Executive Officers Who Are Not Directors
Each of the Executive Officers of the Company is a Director of the Company.
Stock Ownership by Directors, Nominees and Officers
The following table sets forth the number of shares of Common Stock of the
Company beneficially owned as of January 23, 1997, and the percentage of the
outstanding shares of Common Stock so held, by (i) each beneficial owner of more
than five percent of Common Stock, (ii) each person who is a Director or nominee
of the Company, (iii) each executive officer of the Company named in the Summary
Compensation Table set forth herein and (iv) all Directors and executive
officers as a group.
<PAGE>
Number of
Shares
Name of Beneficially Percentage
Beneficial Owner Owned of Class
-------------------- ----------- ----------
Ronald M. Greenstone.................... 2,850,000 (1) 37%
Gary C. Roberts......................... 1,050,000 (1) 14%
Leonard Schrift......................... 50,000 1%
Martin S. Sussman....................... 30,000 (2) *%
Anthony V. Curto........................ 0 0%
Richard Projain......................... 30,000 *%
All Directors and executive
officers as a group (6 persons)....... 4,010,000 52%
* Less than 1%
(1) Includes 150,000 shares of Common Stock which the holder has the right
to acquire within 60 days upon the exercise of options granted by the
Company.
(2) Includes 10,000 shares of Common Stock over which the holder has sole
voting power and sole investment power.
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors has furnished the
following report on executive compensation:
PHILOSOPHY
The fundamental philosophy of the Company's executive compensation program
is to offer competitive compensation opportunities which are based on each
individual executive officer's contribution and personal performance. The
compensation of the Company's executive officers is reviewed and approved by the
Compensation Committee which utilizes compensation analyses for similar type and
size agencies provided by the industry trade associations to ensure that the
compensation is both reasonable and competitive, and also is directly linked to
the Company's financial performance and shareholder interest.
There are three elements in the Company's executive compensation program,
as determined by individual and corporate performance.
- Base salary compensation is determined by the potential impact of the
individual on the Company's performance, the skill and experience
required by the job, and the performance and potential of the incumbent
in the job.
- Annual incentive compensation is based on corporate operating earnings.
Mr. Greenstone and Mr. Roberts each are eligible to earn a bonus based
on a percentage of the Company's profits before provision for income
tax.
- Long term incentive compensation consists of eligibility under the
Option Plan. Stock option grants are awarded based on individual and
Company performance.
Mr. Greenstone and Mr. Roberts also maintain a significant long-term stock
ownership position in the Company's Common Stock. This ownership position
creates a strong linkage between the Company's management and its shareholders'
interests.
THE COMPENSATION COMMITTEE
Anthony V. Curto
Richard Projain
Leonard Schrift
Summary Compensation Table
The following table sets forth for the Company's last three fiscal years
the compensation paid by the Company to its Chief Executive Officer and two
other most highly compensated executive officers whose cash compensation
exceeded $100,000 (the "Named Executive Officers").
GREENSTONE ROBERTS ADVERTISING, INC.
EXECUTIVE COMPENSATION
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
---------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Year Base Other Restricted All Other
Name and ended Salary2 Bonus Annual Stock LTIP Compensation3
Principal Position October 31, ($) ($) Compensation Awards Options Payouts ($)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ronald Greenstone 1994 365,000 1,717 -- -- -- -- 1,386
Chairman and CEO 1995 365,000 -- -- -- -- -- 1,386
1996 365,000 -- -- -- -- -- 1,425
Gary Roberts 1994 300,000 1,145 -- -- -- -- 1,386
President 1995 300,000 -- -- -- -- -- 1,386
1996 300,000 -- -- -- -- -- 1,425
Leonard Schrift 1 1994 -- -- -- -- -- -- --
Sr. V.P., CFO, 1995 -- -- -- -- -- -- --
Treasurer 1996 84,000 -- -- -- -- -- --
</TABLE>
1 As Mr. Schrift joined the Company in March 1996, amounts shown for Mr.
Schrift in 1996 reflect less than a full year of compensation.
2 The Named Executive Officers receive indirect compensation in the form of
automobile allowances, the use of automobiles and insurance payments on the
automobiles. The amount of such indirect compensation paid or distributed in
fiscal 1996 did not exceed, with respect to any named individual, the lesser
of $50,000 or 10% of the total annual compensation reported for such person.
3 Amounts represent contributions by the Company under the 401(k) savings plan.
<PAGE>
Employment Agreements
Ronald Greenstone currently serves as Chairman and Chief Executive Officer
of the Company pursuant to the terms of an employment agreement which expires on
January 1, 1998. This agreement was entered into on December 22, 1988, and was
subsequently renewed through December 31, 1991, again through December 31, 1994
and again through January 1, 1998. This agreement currently provides for an
annual salary of no less than $365,000 and a cash bonus equivalent to 3% of the
profit of the Company before provision for income taxes.
Gary Roberts currently serves as President and Chief Operating Officer of
the Company pursuant to the terms of an employment agreement which expires on
January 1, 1998. This agreement was entered into on November 29, 1988, and was
subsequently renewed through December 31, 1993, again through December 31, 1995,
and again through January 1, 1998. This agreement currently provides for an
annual salary of no less than $300,000 and a cash bonus equivalent to 2% of the
profit of the Company before provision for income taxes.
Each of the foregoing employment agreements restricts the respective
officer's ability to use or disclose confidential information related to the
business of the Company and to compete with the Company upon termination of his
employment by the Company.
In addition, each of the employment agreements provides that the respective
officer, upon termination of employment otherwise than for cause, will receive a
lump sum payment equal to such officer's annual salary, will continue to receive
such officer's annual salary for the remainder of the employment period and will
continue to be eligible for the Company's employee benefits.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and officers to file with the Securities and Exchange
Commission (the "Commission") initial reports of ownership and reports of
changes in ownership of the Company's Common Stock. Copies of all such Section
16(a) reports are required to be furnished to the Company. These filing
requirements also apply to holders of more than ten percent of the Company's
Common Stock.
To the Company's knowledge, based solely on review of the copies of Section
16(a) reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended October 31, 1996, all
Section 16(a) filing requirements applicable to its officers, directors and
beneficial owners of ten percent or more of Common Stock were complied with.
<PAGE>
COMPARATIVE PERFORMANCE OF THE COMPANY
The Commission requires the Company to present a chart comparing the
cumulative total shareholder return on its Common Stock with the cumulative
total shareholder return of (i) a broad equity market index and (ii) a published
industry index or peer group for a five-year period. The following chart
compares the performance of the Common Stock with (i) the stocks comprising the
NASDAQ National Market (the "NASDAQ Index") and (ii) the stocks comprising the
Dow Jones Advertising Industry Group (the "Dow Jones Advertising Index"), and
assumes an investment of $100 on October 31, 1991 in each of the Common Stock,
the NASDAQ Index and the Dow Jones Advertising Index:
<TABLE>
<CAPTION>
(See printed Proxy Statement for graphic version of table printed below.)
10/31/91 10/31/92 10/31/93 10/31/94 10/31/95 10/31/96
<S> <C> <C> <C> <C> <C> <C>
Company 100 183 142 125 117 125
NASDAQ
Index 100 111 144 143 192 204
Dow Jones
Advertising
Index 100 129 132 147 168 232
</TABLE>
RATIFICATION OF SELECTION OF INDEPENDENT AUDITOR
Arthur Andersen LLP, the Company's independent auditor for the fiscal years
ended October 31, 1996 and 1995, was dismissed by the Company on February 19,
1997. Ernst & Young LLP has been selected as the Company's independent auditor
for the year ended October 31, 1997. Such selection is being submitted to the
Company's shareholders for ratification. Arthur Andersen LLP has served as the
Company's independent auditor since 1988. One or more representatives of Arthur
Andersen LLP and Ernst & Young LLP are expected to be present at the Annual
Meeting of Shareholders and will have the opportunity to make a statement, if
they so desire, and to respond to appropriate questions from shareholders.
As of February 19, 1997, Ernst &Young LLP has been engaged as the Company's
new independent auditor. The decision to change independent auditor was related
solely to the cost of providing auditing services for the current year, and not
to a disagreement of any kind, and was approved by the Executive Committee of
the Company's Board of Directors. Arthur Andersen LLP's report on the Company's
financial statements for the fiscal years ended October 31, 1996 and 1995 did
not contain an adverse opinion or disclaimer of opinion and was not qualified or
modified as to uncertainty, audit scope or accounting principles. During fiscal
1996 and 1995 and the subsequent interim period through February 19, 1997, there
were no disagreements between the Company and Arthur Andersen LLPon any matter
of accounting principles or practice, financial statement disclosure or auditing
scope or procedure which, if not resolved to the satisfaction of such auditor,
would have caused it to make reference to the subject of such disagreement in
connection with its reports. During its two most recent fiscal years and the
subsequent interim period through February 19, 1997, the Company has not
consulted Ernst &Young LLP with regard to either: (i) application of accounting
principles to a specified transaction, either completed or proposed; or the type
of audit opinion that might be rendered on the Company's financial statements,
or (ii) any matter that was either the subject of a disagreement or a reportable
event.
The Board of Directors recommends that the shareholders vote for
ratification of the selection of Ernst &Young LLP as independent auditor for the
Company for the 1997 fiscal year.
<PAGE>
OTHER BUSINESS
As of the date of this Proxy Statement, the only business which the Board
of Directors intends to present, and knows that others will present, at the
Annual Meeting of Shareholders is set forth herein. If any other matter or
matters are properly brought before the Annual Meeting of Shareholders or any
adjournment or postponement thereof, it is the intention of the persons named in
the accompanying form of proxy to vote the proxy on such matters in accordance
with his judgment.
Shareholders' Proposals
Any proposal which a shareholder expects to present at the next Annual
Meeting of Shareholders must be received at the Company's principal executive
office shown on the first page of this Proxy Statement, Attention: Secretary,
not later than October 31, 1997 to be considered for inclusion in the proxy
material for the 1998 Annual Meeting of Shareholders.
<PAGE>
* * *
THE COMPANY WILL FURNISH WITHOUT CHARGE TO ANY SHAREHOLDER OF THE COMPANY
AS AT FEBRUARY 21, 1997 WHO SO REQUESTS IN WRITING, A COPY OF THE COMPANY'S
ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED OCTOBER 31, 1996. ANY SUCH
REQUEST SHOULD BE DIRECTED TO RONALD M. GREENSTONE, CHAIRMAN, GREENSTONE ROBERTS
ADVERTISING, INC., ONE HUNTINGTON QUADRANGLE, MELVILLE, NEW YORK 11747. A
SHAREHOLDER OWNING SHARES BENEFICIALLY BUT NOT OF RECORD AS AT FEBRUARY 21,
1997, SHOULD INCLUDE IN SUCH REQUEST A REPRESENTATION THAT SUCH SHAREHOLDER WAS
A BENEFICIAL OWNER OF THE COMPANY'S COMMON STOCK ON THAT DATE.
