May 12, 2000
Dear Shareholders:
We cordially invite you to attend the Meeting of the Shareholders of The
Classica Group, Inc. (the "Company") to be held at 10:00 a.m. on Tuesday, June
13, 2000, at the offices of Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP,
99 Wood Avenue South, Iselin, New Jersey 07095.
The purposes of this meeting are to (i) elect a Board of five (5)
directors, and (ii) ratify the appointment of auditors. These matters are
described in the accompanying Notice of Meeting and Proxy Statement.
The Board of Directors recommends that Shareholders vote in favor of each
proposal. We encourage all Shareholders to participate by voting their shares by
Proxy whether or not they plan to attend the meeting. Please sign, date and mail
the enclosed Proxy as soon as possible. If you do attend the Annual Meeting, you
may still vote in person.
Sincerely,
Bernard F. Lillis, Jr.
Secretary
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held on June 13, 2000
Notice is hereby given that the Annual Meeting of Shareholders (the
"Meeting") of The Classica Group, Inc. (the "Company") will be held at the
offices of Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP, 99 Wood Avenue
South, Iselin, New Jersey at 10:00 a.m. Eastern Time, for the following
purposes:
1. To elect a Board of Directors of five (5) persons to serve until the 2001
Annual Meeting of Shareholders or until a successor is duly elected and
qualified.
2. To approve the appointment of Deloitte & Touche LLP as the Company's
independent auditors.
3. To transact such other business as may properly come before the Meeting or
any adjournment thereof.
Only shareholders of record at the close of business on May 9, 2000 will be
entitled to notice of and to vote at the Meeting.
Whether or not you intend to attend the Meeting, please complete, date and
sign the enclosed Proxy. Your Proxy will be revocable, either in writing or by
voting in person at the Meeting, at any time prior to its exercise.
By Order of the Board of Directors
---------------------------------
BERNARD F. LILLIS, JR., Secretary
Lakewood, New Jersey
May 12, 1999
<PAGE>
THE CLASSICA GROUP, INC.
1835 Swarthmore Avenue
Lakewood, New Jersey 08701
PROXY STATEMENT
Accompanying this Proxy Statement is a Notice of Annual Meeting of
Shareholders, the Company's Form 10KSB for the year ended December 31, 1999, and
a form of Proxy for such meeting solicited by the Board of Directors. The Board
of Directors has fixed the close of business on May 9, 2000, as the record date
for the determination of shareholders that are entitled to notice of and to vote
at the meeting or any adjournment thereof. The holders of a majority of the
outstanding shares of Common stock present in person, or represented by Proxy,
shall constitute a quorum at the meeting.
As of the record date, the Company had 1,267,833 outstanding shares of
common stock, $.001 par value (the "Common Stock"), the holders of which are
entitled to one vote per share.
A Proxy that is properly submitted to the Company may be revoked at any
time before it is exercised by written notice to the Secretary of the Company,
and any Shareholder attending the meeting may vote in person and by doing so
revokes any Proxy previously submitted by him. Where a Shareholder has specified
a choice on his Proxy with respect to Proposals 1 and 2, it will be complied
with. If no direction is given, all the shares represented by the Proxy will be
voted in favor of such Proposals.
The cost of soliciting Proxies will be paid by the Company, which will
reimburse brokerage firms, custodians nominees and fiduciaries for their
expenses in forwarding proxy material to the beneficial owners of the Company's
stock. Officers and regular employees of the Company may solicit Proxies
personally and by telephone. The Annual report of the Company for the fiscal
year ended December 31, 1999, containing audited financial statements for such
year, is enclosed with this Proxy Statement. This Proxy Statement and the
enclosed Proxy are being sent to the shareholders of the Company on or about May
12, 2000.
IN ORDER THAT YOUR SHARES MAY BE REPRESENTED AT THIS MEETING, YOU ARE REQUESTED
TO PLEASE SIGN, DATE AND MAIL THE PROXY PROMPTLY.
<PAGE>
Proposal 1
ELECTION OF DIRECTORS
According to the Company's By-Laws, the Board of Directors is composed of
five (5) members. At each Annual Meeting, all directors will be elected to serve
for one year expiring on the date of the Annual Meeting of shareholders for the
following year. Each director elected will continue in office until a successor
has been elected or until resignation or removal in the manner provided by the
Company's By-Laws. The names of the nominees for the Board of directors are
listed below. Shares represented by a properly executed proxy in the
accompanying form will be voted for such nominees. However, discretionary
authority is reserved to vote such shares in the best judgment of the persons
named in the event that any person or persons other than the nominees listed
below are to be voted on at the meeting due to the unavailability of any nominee
so listed.
All persons named below are directors of the Company at the present time.
There are no family relationships between any nominees, directors or executive
officer of the Company.
NOMINEES FOR ONE YEAR TERMS
Scott G. Halperin has been Chairman of the Company since July 1, 1997 and Chief
Executive Officer since August 16, 1994. He also served as Treasurer from May of
1994 through June 30, 1997. He serves as President and Chief Executive Officer
of Agama, Inc., which pursued mergers and acquisitions from 1993 through the end
of 1994, the Company is currently inactive. He has been Chairman of the Board of
stereoscape.com, inc. since February of 1997.
Bernard F. Lillis, Jr. has been a director, Chief Operating Officer, and
Treasurer since July 1, 1997. He has been Chief Financial Officer since Apri1
15, 1996. Prior to joining Saratoga he served as Chief Financial Officer of one
of the largest suppliers of construction aggregate in the New York Metropolitan
Area for fourteen years. Previously he was Vice President Finance &
Administration of a Princeton (NJ) management consulting firm for seven years.
Mr. Lillis also served as Deputy City Manager-Finance of Rochester, New York,
and began his career with Deloitte & Touche (previously Haskins & Sells),
Certified Public Accountants. He is a Certified Public Accountant, a recipient
of the New York State Society of CPA's Award for Outstanding Scholastic
Achievement in Accounting, and a member of the New York, New Jersey and
Pennsylvania Societies of CPA's, and the Institute of Management Accountants. He
has been a director of Alliance Technologies, Inc. since April of 1997.
Joseph M. Greene has been a director of the Company since February 23, 1998. He
is the founder and has been the Chief Executive Officer of Advanced Trading
Concepts since January of 1990, a sales agency for various, fully tariffed,
switch and network based domestic and international carriers of telephone
services. Additionally, he was the founder of National Telephone Company in
March of 1987. He is a graduate of the College of William and Mary.
Alan Rubin has been a director of the Company since January 28, 2000. Since 1998
he has been a named partner of Nalven, Paredes, Payne, & Rubin, a Registered
Investment Advisor. Prior to 1998, he had an advisory role with Lincoln
Securities Corporation and Lincoln National Equity Sales Corporation. He was
appointed a member of Corestates Bank Investment Advisory Committee to advise on
management, due diligence and availability of client investment programs and
supervision of representatives.
Harry J. Friedberg has been a director of the Company since March 2, 1998. He
has been engaged in the private practice of law since 1963. He is admitted to
the Bars of the state of New York and the District of Columbia.
INFORMATION CONCERNING BOARD
The Board of Directors met 1 times in fiscal 1999. No director attended
fewer than 75% of the meetings of the Board of Directors. In addition, the Board
acted by unanimous consent 4 times during fiscal 1999.
The Board of Directors has an Audit Committee. The Audit Committee is
responsible for reviewing the Company's audited financial statements, meeting
with the Company's independent accountants to review the Company's internal
controls and financial management practices and examining all agreements or
other transactions between the Company and its directors and officers to
determine whether such agreements or transactions are fair to the Company's
shareholders. Messrs. Greene, Rubin, and Halperin currently serve on the Audit
Committee.
2
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information, as of May 5, 2000,
regarding the ownership of the Common Stock by (i) each director and nominee for
director of the Company; (ii) each of the executive named officers and nominees,
(iii) each person known to the Company to beneficially own five percent (5%) or
more of the Company's Common Stock, and (iv) all directors and executive
officers of the Company as a group.
(A)
Common Stock
Percentage of
Name of Beneficial Owner (A) Number of Shares Outstanding (H)
- --------------------------------------------------------------------------------
Scott G Halperin 322,031 (B) 21.2%
1835 Swarthmore Avenue
Lakewood, N.J. 08701
Bernard F. Lillis, Jr. 206,752 (C) 14.5%
1835 Swarthmore Avenue
Lakewood, N.J. 08701
Joseph M. Greene 23,500 (D) 1.6%
1835 Swarthmore Avenue
Lakewood, N.J. 08701
Harry J. Friedberg 26,667 (E) 2.1%
551 Fifth Avenue, Suite 3400
New York, N.Y. 10176
Alan Rubin 10,000 (F) 0.8%
1835 Swarthmore Avenue
Lakewood, N.J. 08701
Robert Castellano 32,995 (G) 2.6%
1835 Swarthmore Avenue
Lakewood, N.J. 08701
All Directors and executive officers
as a group 621,945 36.4%
All information with respect to beneficial ownership of the shares is based
upon filings made by the respective beneficial owners with the Securities and
Exchange Commission or information provided by such beneficial owners to the
Company. Shares include stock options and warrants exercisable within 60 days.
3
<PAGE>
(B) Includes options to purchase 199,111 shares at $1.25 held by Mr. Halperin.
(C) Includes options to purchase 158,778 shares at $1.25 held by Mr. Lillis.
(D) Includes options to purchase 20,500 shares at $1.25 held by Mr. Greene.
(E) Includes options to purchase 26,000 shares at $1.25 held by Mr. Friedberg.
(F) Includes options to purchase 10,000 shares at $3.25 held by Mr. Rubin.
(G) Includes options to purchase 20,000 shares at $1.25 held by Mr.Castellano.
(H) For each beneficial owner, the "Percentage of Outstanding" equals each
owner's actual holdings of shares plus shares represented by unexercised
options and warrants held, divided by total shares outstanding of the
Company at May 5, 2000,of 1,267,833, plus the above-referenced unexercised
options and warrants of the referenced holder only. In other words,
individual percentages of the listed holders will not add to the group
total because the calculations are made separately for each holder.
EXECUTIVE COMPENSATION
The following table sets forth, for each of the last fiscal years, cash and
certain other compensation paid or accrued by the Company for the Chief
Executive Officer and Chief Operating Officer. There are no other executive
officers who earned at least $100,000 for any of the last three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation ($) Long-Term Compensation ($)
Restricted Securities Long-Term
Name and Principal Other Annual Stock Underlying Incentive Plan All Other
Position Year Salary Bonus Compensation Awards Options Payouts Compensation ($)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Scott G. Halperin 1999 190,008 - 7,936 - 160,000 - -
Chairman of the Board 1998 190,008 - 6,213 - 149,838 - -
Chief Executive Officer 1997 - - 6,205 - 195,556 - -
Bernard F. Lillis, Jr. 1999 160,006 - 5,504 - 125,000 - -
Chief Operating Officer 1998 160,008 - 5,700 - 96,531 - -
Chief Financial Officer 1997 80,067 - 5,602 - 168,889 - -
Robert Castellano 1999 106,033 - 7,936 - 20,000 - -
President, 1998 97,552 - 6,213 - - -
Cucina Classica
Italiana, Inc. 1997 91,686 - 6,205 - - -
</TABLE>
4
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
Individual Grants
---------------------
% of Total
Number of Options
Securities Granted to Exercise
Underlying Employees or Base
Options in Fiscal Price Expiration
Name Granted (#) Year ($/Sh) Date
- --------------------------------------------------------------------------------
Scott G. Halperin 160,000 34.9% 1.25 October 5, 2009
Bernard F. Lillis, Jr. 125,000 27.3% 1.25 October 5, 2009
Robert Castellano 20,000 4.4% 1.25 October 5, 2009
AGGREGATED OPTION EXERCISES IN 1999 AND
DECEMBER 31, 1999 OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities
Shares Underlying Unexercised Value of Unexercised In-the-
Acquired on Value Options at Fiscal Year-End(#) Money Options at FY-End ($)
Name Exercise(#) Realized($) Exercisable Unexercisable Exercisable Unexercisable
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Scott G. Halperin - - 199,111 0 566,222 0
Bernard F. Lillis, Jr. - - 158,778 0 451,525 0
Robert Castellano - - 20,000 0 56,875 0
</TABLE>
* Options are "in-the-money" if, on April 14, 2000, the market price of the
Common Stock ($4.09375) exceeded the exercise price of such options. The value
of such options is calculated by determining the difference between the
aggregate market price of the Common Stock covered by such options on April 14,
2000, and the aggregate price of such options.
Employment Agreements
The Company has employment agreements with both Scott G. Halperin, the
Company's Chairman and Chief Executive Officer and Bernard F. Lillis, Jr, the
Company's Chief Financial Officer and Chief Operating Officer. Reference is made
to exhibits 10 (ae) and 10( af) for all terms and conditions of the agreements,
which are summarized below.
Scott G. Halperin
On August 1, 1997, the Company entered into an employment agreement the
("Halperin Agreement") with Scott G. Halperin. This Halperin Agreement
superseded and replaced Mr. Halperin's previous employment agreement. The
Halperin Agreement provides that Mr. Halperin shall serve as Chairman of the
Board and Chief Executive Officer of the Company from August 1, 1997 through
July 31, 2005. The Employment Agreement provides that the Company shall pay Mr.
Halperin at the annual rate of $220,000 for the initial term of the Employment
Agreement. The Employment Agreement may be renewed by the Company for successive
three year periods commencing on the termination date, by mutual agreement of
the Company and Mr. Halperin provided however that the Company may elect to
terminate the agreement at the end of the term hereof, or the then renewal term,
as the case may be, giving written notice of such non-renewal not less than 180
days prior to the then current term or the renewal term of the agreement. Mr.
Halperin's base compensation shall be increased annually by twenty percent from
August 1 1998 through July 31, 2001 and by fifteen percent from August 1, 2001
through July 31 2005. Additionally, Mr. Halperin's base compensation shall
increase by fifteen percent on the date of renewal and annually thereafter. In
addition to his base salary, Mr. Halperin is entitled to receive additional
incentive compensation during each fiscal year in an amount not less than 2% of
the increase in gross revenues of the Company during each such year as compared
to the prior year, commencing with the fiscal year ended December 31, 1996, and
any other bonus the Company's Board of Directors may award to Mr. Halperin.
5
<PAGE>
The Employment Agreement provides that the Company shall pay Mr. Halperin
an automobile expense allowance in the amount of $12,000 per annum. The Company
shall maintain a medical and dental plan for qualified employees that covers Mr.
Halperin, his spouse and his minor children and it shall bear the premiums
related to Mr. Halperin and his family.
The Company may terminate Mr. Halperin for "Cause," which is defined as (a)
willfully damaging the Company's property, (b) conviction of a felony, (c)
willfully engaging in theft, fraud, embezzlement or securities law violations
with respect to the Company, or (d) willfully and substantially failing to
perform his duties under the Employment Agreement (other than a failure
resulting from Mr. Halperin's incapacity due to physical or mental illness).
Mr. Halperin may terminate the Employment Agreement for Good Reason (as
defined below) or if his health should become impaired to an extent that makes
the continued performance of his duties under the Employment Agreement hazardous
to his physical or mental health. "Good Reason" includes, but is not limited to,
failure of the Company to comply with the Company's material obligation and
agreement, or an assignment to Mr. Halperin of any duties or reporting
obligations other than those contemplated by, or any limitation of the powers of
Mr. Halperin in any respect not contemplated by, the Employment Agreement.
Upon the early termination of the Employment Agreement by the Company
(other than for Mr. Halperin's death, his disability or cause) or upon the early
termination of the Employment Agreement by Mr. Halperin for Good Reason, the
Company is required to pay to Mr. Halperin his full base salary through the time
notice of termination is given and a lump sum payment equal to the greater of
(i) the remaining compensation (including incentive compensation) payable to Mr.
Halperin as though the Employment Agreement had been performed through July 31,
2005 or such later date to which the term of the employment has been extended
and (ii) the total compensation earned by Mr. Halperin during the one year
period prior to the date of termination. Under such circumstances, Mr. Halperin
is also entitled to receive all employee benefits until the later of (A) July
31, 2005 or such later date to which the term of the Employment Agreement has
been extended or (B) one year from the date of termination. In addition, all
stock awards and options theretofore awarded or granted to Mr. Halperin shall,
to the fullest extent permitted by applicable law, immediately vest.
The Employment Agreement prohibits Mr. Halperin from disclosing
confidential information or trade secrets of the Company during the term of his
employment under the Employment Agreement and for 12 months thereafter. The
Employment Agreement also prohibits Mr. Halperin from competing, during the
period of his employment under the Employment Agreement and for 12 months
thereafter, within any county (or adjacent county) in any state within the
United States in which the Company is engaged in business during Mr. Halperin's
employment by the Company. However, the restrictions on disclosure and
competition do not apply if the Company terminates Mr. Halperin without Cause or
if Mr. Halperin terminates the Employment Agreement for Good Reason.
The Employment Agreement also grants Mr. Halperin certain demand and
"piggyback" registration rights with respect to the shares of common stock owned
by him.
Mr. Halperin waived cash compensation in excess of $190,000 for 1998 and
1999; and all cash compensation for 1996 and 1997 in exchange for additional
employee stock options.
Bernard F. Lillis, Jr.
On August 1, 1997, the Company entered into an employment agreement the
("Lillis Agreement") with Bernard F. Lillis, Jr.. The Lillis Agreement provides
that Mr. Lillis shall serve as Chief Financial Officer and Chief Operating
Officer of the Company from August 1, 1997 through July 31, 2005. The Employment
Agreement provides that the Company shall pay Mr. Lillis at the annual rate of
$190,000 for the initial term of the Employment Agreement. The Employment
Agreement may be renewed by the Company for successive three year periods
commencing on the termination date, by mutual agreement of the Company and Mr.
Lillis provided however that the Company may elect to terminate the agreement at
the end of the term hereof, or the then renewal term, as the case may be, giving
written notice of such non-renewal not less than 180 days prior to the then
current term or the renewal term of the agreement. Mr. Lillis's base
compensation shall be increased annually by twenty percent from August 1 1998
through July 31, 2001 and by fifteen percent from August 1, 2001 through July 31
2005. Additionally, Mr. Lillis's base compensation shall increase by fifteen
percent on the date of renewal and annually thereafter. In addition to his base
salary, Mr. Lillis is entitled to receive additional incentive compensation
during each fiscal year in an amount not less than 2% of the increase in gross
revenues of the Company during each such year as compared to the prior year,
commencing with the fiscal year ended December 31, 1996, and any other bonus the
Company's Board of Directors may award to Mr. Lillis.
6
<PAGE>
The Employment Agreement provides that the Company shall pay Mr. Lillis an
automobile expense allowance in the amount of $12,000 per annum. The Company
shall maintain a medical and dental plan for qualified employees that covers Mr.
Lillis, his spouse and his minor children and it shall bear the premiums related
to Mr. Lillis and his family.
The Company may terminate Mr. Lillis for "Cause," which is defined as (a)
willfully damaging the Company's property, (b) conviction of a felony, (c)
willfully engaging in theft, fraud, embezzlement or securities law violations
with respect to the Company, or (d) willfully and substantially failing to
perform his duties under the Employment Agreement (other than a failure
resulting from Mr. Lillis's incapacity due to physical or mental illness).
Mr. Lillis may terminate the Employment Agreement for Good Reason (as
defined below) or if his health should become impaired to an extent that makes
the continued performance of his duties under the Employment Agreement hazardous
to his physical or mental health. "Good Reason" includes, but is not limited to,
failure of the Company to comply with the Company's material obligation and
agreement, or an assignment to Mr. Lillis of any duties or reporting obligations
other than those contemplated by, or any limitation of the powers of Mr. Lillis
in any respect not contemplated by, the Employment Agreement.
Upon the early termination of the Employment Agreement by the Company
(other than for Mr. Lillis's death, his disability or cause) or upon the early
termination of the Employment Agreement by Mr. Lillis for Good Reason, the
Company is required to pay to Mr. Lillis his full base salary through the time
notice of termination is given and a lump sum payment equal to the greater of
(i) the remaining compensation (including incentive compensation) payable to Mr.
Lillis as though the Employment Agreement had been performed through July 31,
2005 or such later date to which the term of the employment has been extended
and (ii) the total compensation earned by Mr. Lillis during the one year period
prior to the date of termination. Under such circumstances, Mr. Lillis is also
entitled to receive all employee benefits until the later of (A) July 31, 2005
or such later date to which the term of the Employment Agreement has been
extended or (B) one year from the date of termination. In addition, all stock
awards and options theretofore awarded or granted to Mr. Lillis shall, to the
fullest extent permitted by applicable law, immediately vest.
The Employment Agreement prohibits Mr. Lillis from disclosing confidential
information or trade secrets of the Company during the term of his employment
under the Employment Agreement and for 12 months thereafter. The Employment
Agreement also prohibits Mr. Lillis from competing, during the period of his
employment under the Employment Agreement and for 12 months thereafter, within
any county (or adjacent county) in any state within the United States in which
the Company is engaged in business during Mr. Lillis's employment by the
Company. However, the restrictions on disclosure and competition do not apply if
the Company terminates Mr. Lillis without Cause or if Mr. Lillis terminates the
Employment Agreement for Good Reason.
The Employment Agreement also grants Mr. Lillis certain demand and
"piggyback" registration rights with respect to the shares of common stock owned
by him.
Mr. Lillis waived cash compensation in excess of $160,000 for 1998 and
1999.
DIRECTORS' REPORT ON COMPENSATION
The Board of Directors reviews, recommends and approves changes to the
Company's compensation policies and programs and is responsible for reviewing
and approving the compensation of the Chief Executive Officer and other senior
officers of the Company.
The following report 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 or under the Securities Exchange Act of
1934, except to the extent the Company specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.
The Board of Directors is responsible for reviewing the compensation and
benefits of the Company's executive officers concerning compensation and
benefits for such executive officers and administering the Company's stock
option plans.
7
<PAGE>
The Company believes that executive compensation should be based upon value
returned to shareholders. The Company has developed and is developing
compensation programs designed to reflect Company performance and to be
competitive in the marketplace. In designing compensation programs, the Company
attempts to reflect both value created for shareholders while supporting the
Company's strategic goals. The Company's compensation programs reflect the
following themes:
o Compensation should be meaningfully related to the value created for
shareholders
o Compensation programs should support the Company's short-term and
long-term strategic goal and objectives.
o Compensation programs should promote the Company's value and reward
individuals for outstanding contributions to the Company's success.
o Short-term and long-term compensation should be designed to attract
and retain superior executives.
The Company's executive compensation is based upon three components, base
salary, annual incentive bonuses and long-term incentives, which are intended to
serve the overall compensation philosophy.
Base Salary
The base salary of each executive officer is determined as a function of
three principal factors: the individual's performance, the relationship of the
individual's salary to similar executives in comparable companies, and increases
in the individual's responsibilities, whether through promotions or otherwise.
Annual Incentive Bonus
The Company's annual incentive bonuses are designed to reflect the
individual officer's contribution to the profitability of the Company and any
special achievements by the respective officers. Each officer's bonus is based
upon the Company's performance in various areas, such as sales, profit margins,
operating expenses and net income, as compared to a pre-determined plan for each
officer each year.
PERFORMANCE TABLE
Growth of $100
CSRP Non-Financial The Classica Group, Inc. NASDAQ Market Index
- --------------------------------------------------------------------------------
12/31/95 100.000 100.000 100.000
12/30/96 121.472 20.540 123.035
12/29/97 142.250 13.560 150.758
12/31/98 208.479 10.120 212.437
12/31/99 401.668 3.690 383.790
Pct. Ch. 401.668% -96.310% 383.790%
This table 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 or under the Securities Exchange Act of 1934, except
to the extent that the Company specifically incorporates this graph by
reference, and shall not otherwise be deemed filed under such Acts.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE TO ELECT THE
AFOREMENTIONED NOMINEES TO SERVE ON THE BOARD OF DIRECTORS.
8
<PAGE>
PROPOSAL 2
RATIFICATION OF THE
SELECTION OF INDEPENDENT AUDITORS
The selection of independent auditors to examine the financials statements
of the Company for the fiscal year ending December 31, 2000 to be transmitted or
made available to shareholders and filed with the Securities and Exchange
Commission is to be submitted to the meeting for ratification.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
RATIFICATION OF DELOITTE & TOUCHE LLP AS THE COMPANY'S INDEPENDENT AUDITORS.
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
The Securities Exchange Act of 1934 requires the Company's directors and
executive officers and person who own more than ten percent of a registered
class of the Company's equity securities to file reports of beneficial ownership
and changes in beneficial ownership with the Securities and Exchange Commission.
To the knowledge of the Company, all filing requirements under Section 16(a) in
respect of the Company were complied within the year ended December 31, 1999.
GENERAL
The expense of this solicitation is to be borne by the Company. The Company
may also reimburse persons holding shares in their names or in the names of
their nominees for their expenses in sending proxies and proxy material to their
principals.
Unless otherwise directed, the persons named in the accompanying form of
proxy intend to vote all proxies received by them in favor of the election of
nominees to the Board herein, and the ratification of selected independent
auditors. All proxies will be voted as specified.
Management does not intend to present any business at the meeting other
than that set forth in the accompanying Notice of Annual Meeting, and it has no
information that others will do so. If other matters requiring the vote of the
shareholders properly come before the meeting and any adjournments thereof, it
is the intention of the persons named in the accompanying form of proxy to vote
the proxies held by them in accordance with their judgment on such matters.
SHAREHOLDER PROPOSALS FOR THE 2001 ANNUAL MEETING
Shareholder proposals for inclusion in the proxy materials related to the
2001 Annual Meeting of Shareholders must be received by the Company no later
than December 31, 2000. A Shareholder must have been a record or beneficial
owner of the Company's common stock for at least one year prior to December 31,
2000, and the shareholder must continue to own such shares, worth at least
$1,000, through the date on which the Meeting is held.
The Company's by-laws outline procedures, including minimum notice
provisions, for shareholder nominations of directors and other shareholder
business to be brought before shareholders at the Annual Meeting. A copy of the
pertinent by-laws provisions is available upon request to Bernard F. Lillis,
Jr,, Secretary, The Classica Group, Inc., 1835 Swarthmore Avenue, Lakewood, New
Jersey 08701.
By order of the Board of Directors
THE CLASSICA GROUP, INC.
------------------------
BERNARD F. LILLIS, JR.
Secretary
Lakewood, New Jersey
May 12, 2000
9
