<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
[X] Definitive Proxy Statement Rule 14a-6(e)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
ADDvantage Media Group, Inc.
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(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), or 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:
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(2) Aggregate number of securities to which transaction applies:
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(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:
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[_] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
ADDVANTAGE MEDIA GROUP, INC.
5100 East Skelly Drive
Meridian Tower, Suite 1080
Tulsa, Oklahoma 74135
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held July 18, 1996
To the Stockholders of
ADDVANTAGE MEDIA GROUP, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
ADDVantage Media Group, Inc., an Oklahoma corporation (the "Company"), will be
held in the Meeting Tower Conference Room, Meridian Tower, 4th Floor, 5100 East
Skelly Drive, Tulsa, Oklahoma, on Thursday, July 18, 1996, at 10:00 a.m., local
time, for the following purposes:
1. To elect four directors for one year terms;
2. To consider and act upon a proposal to ratify the appointment
for Tullius Taylor Sartain & Sartain as the independent auditors
of the Company for 1996; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on May 31, 1996,
as the record date for the meeting, and only holders of shares of Common Stock
and Series A Preferred Stock of record at such time will be entitled to vote at
the meeting or any adjournment thereof. A complete list of the stockholders
entitled to vote at the meeting will be open to the examination of any
stockholder, for any purpose germane to the meeting, during ordinary business
hours for a period of ten days prior to the date of the meeting at the offices
of the Company and at the time and place of the meeting.
By Order of the Board of Directors,
Lynnwood R. Moore, Jr.
Secretary
Tulsa, Oklahoma
June 18, 1996
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING, WHETHER OR NOT
YOU PLAN TO ATTEND THE MEETING, PLEASE MARK, SIGN, DATE AND RETURN THE
ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES. IF YOU DO ATTEND THE MEETING, YOU MAY WITHDRAW YOUR PROXY
AND VOTE IN PERSON.
<PAGE>
ADDVANTAGE MEDIA GROUP, INC.
5100 East Skelly Drive
Meridian Tower, Suite 1080
Tulsa, Oklahoma 74135
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
To Be Held July 18, 1996
SOLICITATION AND REVOCATION OF PROXIES
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of ADDvantage Media Group, Inc., an Oklahoma corporation
(the "Company"), of proxies to be voted at the Annual Meeting of Stockholders of
the Company to be held on July 18, 1996, or at any adjournment thereof (the
"Annual Meeting"), for the purposes set forth in the accompanying Notice of
Annual Meeting. This Proxy Statement and accompanying proxy were first
forwarded on or about June 18, 1996, to stockholders of record as of May 31,
1996.
If the accompanying proxy is properly executed and returned, the shares
represented by the proxy will be voted at the Annual Meeting. If a stockholder
indicates in his or her proxy a choice with respect to any matter to be acted
upon, that stockholder's shares will be voted in accordance with such choice. If
no choice is indicated, such shares will be voted "FOR" (a) the election of all
of the nominees for directors listed below and (b) the ratification of the
appointment of the independent auditors. A stockholder giving a proxy may revoke
it by giving written notice of revocation to the Secretary of the Company at any
time before it is voted, by executing another valid proxy bearing a later date
and delivering such proxy to the Secretary of the Company prior to or at the
Annual Meeting, or by attending the Annual Meeting and voting in person.
The expenses of this proxy solicitation, including the cost of preparing
and mailing this Proxy Statement and accompanying proxy, will be borne by the
Company. Such expenses will also include the charges and expenses of banks,
brokerage firms and other custodians, nominees or fiduciaries for forwarding
solicitation material regarding the Annual Meeting to beneficial owners of the
Company's Common Stock. Solicitation of proxies may be made by mail, telephone,
personal interviews or other means by the Board of Directors or the Company's
employees who will not be additionally compensated therefor but may be
reimbursed for their out-of-pocket expenses in connection therewith.
STOCKHOLDERS ENTITLED TO VOTE
Stockholders of record at the close of business on May 31, 1996 (the
"Record Date"), will be entitled to vote at the Annual Meeting. As of the Record
Date, there were issued and outstanding 4,942,620 shares of Common Stock, par
value $.01 per share (the "Common Stock"), and 277,750 shares of Series A
Preferred Stock, par value $1.00 per share (the "Preferred Stock"), of the
Company. Each share of Common Stock is entitled to one vote and each share of
Preferred Stock is entitled to 1.48 votes. There is no cumulative voting with
respect to the election of directors.
The presence in person or by proxy of the holders of a majority of the
aggregate shares of Common Stock and Preferred Stock issued and outstanding at
the Annual Meeting will constitute a quorum for the transaction of business.
Votes withheld from nominees for directors, abstentions and broker non-votes
will be counted for purposes of determining whether a quorum has been reached.
Votes will be tabulated by an inspector of election appointed by the Board of
Directors of the Company.
<PAGE>
Abstentions from voting, which may be specified on each proposal except the
election of directors, will have the effect of a negative vote. A broker
non-vote will have no effect on the outcome of the election of directors or the
other proposal.
PROPOSAL ONE
ELECTION OF DIRECTORS
Stockholder action will be requested at the Annual Meeting with respect
to the re-election of each of the current members of the Board of Directors of
the Company (the "Board of Directors") for a one year term expiring at the 1997
Annual Meeting of Stockholders. The By-laws (the "By-laws") of the Company
provide that the Board of Directors shall consist of not less than one nor more
than nine directors, as determined from time to time by resolution of the Board
of Directors. The number of directors is currently fixed at four. The term of
all the members of the Board of Directors, consisting of Charles H. Hood, Gary
W. Young, J. Larre Barrett and John W. Condon, will expire at the Annual
Meeting, and the accompanying proxy solicits your vote for four directors.
The Board of Directors has nominated Charles H. Hood, Gary W. Young, J.
Larre Barrett and John W. Condon, for re-election as directors. The persons
named as proxies in the accompanying proxy, who have been designated by the
Board of Directors, intend to vote, unless otherwise instructed in such proxy,
for the election of Messrs. Hood, Young, Barrett and Condon. Should any nominee
named herein become unable for any reason to stand for election as a director of
the company, it is intended that the persons named in such proxy will vote for
the election of such other person or persons as the Board of Directors may
recommend. The Company knows of no reason why any of the nominees will be
unavailable or unable to serve. The affirmative vote of the holders of a
majority of the aggregate shares of Common Stock and Preferred Stock present in
person or by proxy at the Annual Meeting and entitled to vote is required for
the election of directors.
The Board of Directors recommends a vote "FOR" each of the following
nominees for directors.
Nominees for Directors
Charles H. Hood, age 57, has served as Chairman, President and a
director of the Company since its formation in September 1989. From 1987 to
June 1990, he served as Chairman of the Board of Directors of Ackerman, Hood &
McQueen, Inc., an advertising agency headquartered in Oklahoma, with offices
located in Tulsa and Oklahoma City, Oklahoma, Dallas, Texas, Washington, D.C.,
Cleveland, Ohio and Fort Smith, Arkansas. From 1970 to 1987, Mr. Hood served as
Chairman of the Board of Directors of Hood, Hope and Associates, Inc., an
advertising agency he co-founded in 1970. Mr. Hood received a Bachelor of
Journalism degree from the University of Missouri.
Gary W. Young, age 55, joined the Company in December 1990 as Executive
President - Finance and Administration and a director. Mr. Young is also the
owner and President of Young Ideas Inc., a financial consulting and investment
company he founded in 1987. From 1980 to 1986, he served as Executive Vice
President and a Director of Geodyne Resources, Inc., an oil and gas acquisition
and exploration company headquartered in Tulsa, Oklahoma. From 1970 to 1980, Mr.
Young was Senior Vice President of Finance and Administration and a Director of
Cotton Petroleum Corporation, a Tulsa, Oklahoma, based oil and gas exploration
company. From 1963 to 1970, he was employed by Arthur Young & Company (now Ernst
& Young), a national accounting firm. Mr. Young received a Bachelor of Science
degree from Kansas State University and is a Certified Public Accountant.
J. Larre Barrett, age 56, was elected a director of the Company in
January, 1992. He has served as Vice President of Decker Communication, Inc., a
consulting firm dealing with communication and skills building, since December
1994. From March 1993 to December 1994, Mr. Barrett served
-2-
<PAGE>
as Vice President of Sales for Dorna USA. From 1989 to February 1993, he served
as Vice President - Olympic Marketing Sales of CBS, Inc. Prior to this
position, Mr. Barrett spent 24 years with the ABC Television Network, most
recently serving as its Vice President of Sports Sales and Vice President of
Olympic Marketing and Sales. Mr. Barrett received Bachelor of Journalism and
Master of Arts in Radio/Television Sales & Management degrees from the
University of Missouri.
John W. Condon, age 59, has been a director of the Company since
September 1989. He has been employed by United Graphics, Inc., a company
specializing in pre-printing negatives and color separation, since 1964 and has
served as its Executive Vice President since that time. Mr. Condon received a
Bachelor of Science degree in Commerce with a major in Marketing from the
University of Notre Dame.
Compensation of Directors
The Company's directors receive no additional compensation for their
services on the Board of Directors or any committee thereof. All directors are
reimbursed by the Company for out-of-pocket expenses incurred by them in
connection with their service on the Board of Directors and any committee
thereof.
Meeting and Committees of the Board of Directors
During the 1995, the Board of Directors held one meeting (all other
action being taken by unanimous written consent). Each director attended all
meetings of the Board and of the Committees on which he served during 1995,
except for Mr. Barrett who was unable to attend the Board and Audit Committee
meetings held during the year. The Board of Directors has a standing Audit
Committee and presently has no standing compensation committee or nominating
committee.
The Audit Committee is composed of Messrs. Barrett and Condon. The
Audit Committee annually considers the qualifications of the independent
auditors of the Company and makes recommendations to the Board of Directors on
the engagement of the independent auditors. The Audit Committee also reviews
with the independent auditors the scope and results of the Company's audits,
compliance with any of the Company's written policies and procedures, the
adequacy of the Company's system of internal accounting controls and the
professional services furnished by the independent auditors of the Company. The
Audit Committee met once during 1995.
The Company does not have a standing nominating committee. Nominations
of candidates for election as directors of the Company may be made at a meeting
of stockholders by or at the direction of the Board of Directors or by any
stockholder entitled to vote at such meeting.
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR
Stockholder action will be requested at the Annual Meeting to ratify the
Board of Directors' appointment of the Company's independent auditors for 1996.
The Board of Directors has appointed Tullius Taylor Sartain & Sartain as the
independent auditors of the Company for the fiscal year ending December 31,
1996. Tullius Taylor Sartain & Sartain has been the independent auditors of the
Company since 1994. A proposal will be presented at the Annual Meeting asking
the stockholders to ratify the appointment of Tullius Taylor Sartain & Sartain
as the Company's independent auditors. If the stockholders do not ratify the
appointment of Tullius Taylor Sartain & Sartain, the Board of Directors will
reconsider the appointment. The affirmative vote of the holders of a majority
of the
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<PAGE>
shares present in person or by proxy at the Annual Meeting and entitled to vote
is required for the approval of this proposal.
A representative of Tullius Taylor Sartain & Sartain will be present at the
Annual Meeting. Such representative will be given the opportunity to make a
statement if he desires to do so and will be available to respond to appropriate
questions.
The Board of Directors recommends a vote "FOR" ratification of the
appointment of Tullius Taylor Sartain & Sartain as the Company's independent
auditors of 1996.
PRINCIPLE STOCKHOLDERS AND
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth, as of April 30, 1996, the number and
percentage of shares of Common Stock and Preferred Stock of the Company owned
beneficially, by class and on a combined basis, by (i) each of the directors of
the Company and executive officers named in the "Summary Compensation Table"
below, (ii) all officers and directors as a group, and (iii) each person owning
more than 5% of the Common Stock or Preferred Stock. Except as otherwise
indicated, the stockholders listed in the table have sole voting and investment
powers with respect to the shares.
<TABLE>
<CAPTION>
Common Stock Series A Preferred Stock (B)
----------------------- --------------------------------
Percentage of
Name and Address Number of Shares Percent of Number of Shares Percent Total Combined
of Beneficial Owner Beneficially Owned Class(1) Beneficially Owned of Class Voting Power(8)
------------------ ------------------ ---------- ------------------ -------- ---------------
<S> <C> <C> <C> <C> <C>
Charles H. Hood .......... 551,650(2) 10.8% 65,000 23.4% 11.8%
3264 East 75th Street
Tulsa, OK 74136
Gary W. Young ............ 417,930(3) 8.1% 68,750 21.2% 9.1%
7417 South Floronco
Tulsa, OK 74136
J. Larre Barrett ........ 118,680(4) 2.4% -0- -- 2.2%
1055 Hardscrabble Road
Chappaqua, New York 10514
John W. Condon .......... 129,680(5) 2.6% 12,750 4.6% 2.8%
1748 E. 30th Place
Tulsa, OK 74114
Robert W. Davis ......... 170,150 3.4% 56,875 20.5% 4.8%
3129 S. Columbia Circle
Tulsa, OK 74105
William S. Atherton 290,000(6) 6.9% 12,500 4.5% 5.8%
759 Cal Cove Dr.
Fort Meyers, FL 33919
R. Frank Jerd ........... 17,000 - 50,000 18.0% 1.7%
3105 E. 75th Place
Tulsa, OK 74138
All officers and directors 1,217,840(7) 22.6% 136,500 49.1% 24.5%
as a group (4 persons)
</TABLE>
_______________________
* Less than one percent.
-4-
<PAGE>
(1) Shares of Common Stock which an individual has the right to acquire within
60 days pursuant to the exercise of options are deemed to be outstanding
for the purpose of computing the percentage ownership of such individual,
but are not deemed to be outstanding for the purpose of computing the
percentage ownership of any other person shown in the table or the
percentage ownership of all officers and directors as a group.
(2) Includes 145,000 shares subject to options which are currently exercisable
and 12,500 shares subject to warrants which are currently exercisable.
(3) Includes 195,000 shares subject to stock options which are currently
exercisable and 12,500 shares subject to warrants which are currently
exercisable.
(4) Includes 50,000 shares subject to stock options which are currently
exercisable.
(5) Includes 25,000 shares subject to stock options which are currently
exercisable.
(6) Includes 70,000 shares owned by Atherton & Murphy Investment Company, of
which Mr. Atherton is a partner and 50% owner.
(7) Includes an aggregate of 415,000 shares subject to stock options which are
currently exercisable and 25,000 shares subject to warrants which are
currently exercisable.
(8) Each share of Preferred Stock is convertible into that number of shares of
Common Stock determined by dividing the sum of $4.00 plus the amount of
accrued but unpaid dividends by $4.00. Holders of Preferred Stock are
entitled to vote on all matters together with the holders of Common Stock
and each share of Preferred Stock is entitled to the number of votes equal
to the number of shares then issuable to the holder upon its conversion.
For purposes of this table, it has been calculated that each share of
Preferred Stock is entitled to approximately 1.48 votes.
EXECUTIVE COMPENSATION
The following table sets forth certain information for each of the fiscal
years ended December 31, 1995, 1994 and 1993, with respect to the compensation
paid for services rendered in all capacities to the Company by the Company's
chief executive officer and each executive officer whose total compensation
exceeded $100,000 during fiscal 1995. No other executive officer received
salary and bonus of greater than $100,000.
-5-
<PAGE>
<TABLE>
<CAPTION>
Summary Compensation Table
Annual Compensation Long-Term Compensation
---------------------------------------------- ----------------------------------------------
Number
Other of shares
Annual Restricted Under- Long-Term
Compen- Stock lying incentive
Name and Salary Bonus sation Awards Options Payouts
Principal Position Year ($) ($) ($)(4) ($) Granted ($)
- ------------------ ---- ------ ----- ------ -------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Charles H. Hood, 1995 $106,250(1) $143,750(3) $16,000 -0- 50,000 -0-
President and 1994 100,000(1) -0- -0- -0- -0- -0-
Chairman 1993 100,000(1) -0- -0- -0- 95,000(5) -0-
Gary W. Young, 1995 $106,250(2) $143,750(3) $16,000 -0- 50,000 -0-
Executive Vice 1994 80,000(2) -0- -0- -0- -0- -0-
President 1993 80,000(2) -0- -0- -0- 145,000(6) -0-
- ------------------
</TABLE>
(1) Commencing October 1, 1995, Mr. Hood was entitled to receive an annual
base salary of $125,000, and for the first none months of 1995 and for
each of the fiscal years 1994 and 1993, he was entitled to receive an
annual base salary of $100,000. However, Mr. Hood elected to forego
receiving and salary until such time as the Company's working capital
position improves or conditions otherwise warrant the payment thereof.
The salary has been recorded as an expense during each of these years and
a liability has been accrued for the salary payable to Mr. Hood. During
1995, Mr. Hood received payments of $30,000 with respect to his accrued
salary.
(2) Commencing October 1, 1995, Mr. Young became entitled to receive an
annual base salary of $125,000. Mr. Young was entitled to receive an
annual base salary of $100,000 for the first nine months of fiscal year
1995, and $80,000 for each of fiscal years 1994 and 1993. However, Mr.
Young elected to forego receiving any salary until such time as the
Company's working capital position improves or conditions otherwise
warrant the payment thereof. The salary has been recorded as an expense
during each of these years and a liability has been accrued for the
salary payable to Mr. Young. During 1995, Mr. Young received payments of
$30,000 with respect to his accrued salary.
(3) Represents a cash bonus in the amount of $50,000 to each of Mr. Hood and
Mr. Young and the fair market value at the date of award ($.625 per
share) if 150,000 shares of Common Stock awarded to each of Mr. Hood and
Mr. Young as bonus compensation in 1995. Neither Mr. Hood nor Mr. Young
received payment of the cash bonus in 1995 and payment of such amount was
deferred until the Company's working capital improves or conditions
otherwise warrant payment thereof. The bonuses have been recorded as an
expense for 1995 and a corresponding liability has been accrued for the
bonuses payable.
(4) Other annual compensation represents payment of a non-accountable expense
allowance in 1995. Amounts do not include the value of perquistes or
other personal benefits because the amount of such compensation, if any,
does not exceed the lesser of $50,000 or 10% of the total amount of
annual salary and bonus.
(5) Mr. Hood was granted options to acquire 95,000 shares of Common Stock at
an exercise price of $0.375 per share in May of 1993 which replaced
options for 95,000 shares having an exercise price of $1.00 per share
which had been granted in November 1992.
-6-
<PAGE>
(6) Mr. Young was granted options to acquire 145,000 shares of Common Stock at
an exercise price of $0.375 per share in May of 1993 which replaced options
for 145,000 shares having an exercise price of $1.00 per share which had
been granted in November 1992.
Option Grants
The following table sets forth information with respect to stock
options granted by the Company to each of the named executive officers during
the year ended December 31, 1995.
<TABLE>
<CAPTION>
Percent of
Number of Total
Shares Options Exercise
Underlying Granted to Price
Options Employees Per Share Expiration
Name Granted in 1995 ($) Date
- ---- ------- ------- --------- ----------
<S> <C> <C> <C> <C>
Charles H. Hood 50,000 46.5% $0.20 1/15/2005
Gary W. Young 50,000 46.5% $0.20 1/15/2005
</TABLE>
Fiscal Year End Option Values
There were no stock options exercised by the named executive officers
during the year ended December 31, 1995. The following table sets forth
information regarding the value of unexercised stock options held by each of the
named executive officers as of the year ended December 31, 1995.
<TABLE>
<CAPTION>
Number of Shares of Common Value of Unexercised
Stock Underlying Unexercised In-The-Money Options at
Options at December 31, 1995(#) December 31, 1995($)(1)
------------------------------- -----------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Charles H. Hood 145,000 -0- $357,475 $-0-
Gary W. Young 195,000(2) -0- $477,725 $-0-
</TABLE>
____________
(1) Calculated by determining the difference between the fair market value of
the Company's Common Stock as of December 31, 1995 ($2.78 per share based
on the average of the high and low bid price on such date) and the exercise
price of the underlying options.
(2) Does not include an option granted by Mr. Hood to Mr. Young to purchase
60,000 shares at an exercise price of $1.00 per share.
-7-
<PAGE>
Executive Retirement Plan
In December 1995, the Company adopted the ADDvantage Media Group, Inc.
Supplemental Executive Retirement Plan, a nonqualified deferred compensation
plan (the "Retirement Plan"). The Retirement plan is an unfunded plan
maintained to provide deferred compensation to certain highly compensated
employees of the Company. Participation in the Retirement Plan is limited to
senior management employees of the Company designated by the Company's Board of
Directors. Mr. Hood and Mr. Young have been designated by the Board of
Directors as eligible participants under the Retirement Plan.
Under the Retirement Plan, a participant terminating employment upon
reaching age 62 (the "early retirement date") will be entitled to receive
monthly benefits of approximately $6,770 a month for a period of ten years.
Upon reaching age 65 (the "normal retirement date") or such later date
coinciding with the executive"s termination of or retirement from employment,
each executive will be entitled to receive monthly payments of $10,416.67 (the
"normal retirement benefits") for a period of ten years. In the event of a
long-term disability (as determined by the Board of Directors), the executive
will be entitled to the normal retirement benefits under the Retirement Plan
commencing on the early retirement date. In the event of the death of an
executive participant prior to the termination of employment, such executive's
spouse or designated beneficiary will be entitled to the normal retirement
benefits under the Retirement Plan. If the executive participant's employment
with the Company is terminated prior to the early retirement date, no benefits
are payable under the Retirement Plan.
CERTAIN TRANSACTIONS
On January 18, 1995, the Company filed suit against Wal-Mart Stores, Inc.
("Wal-Mart") in the United States District Court for the Western District of
Arkansas stemming from the contractual relationship between the Company and Wal-
Mart with respect to the use of the Shoppers Calculator(1) in certain Wal-Mart
stores. In order to fund the initial filing of the litigation, Charles H. Hood
and Gary W. Young, each an officer and director of the Company, each loaned the
Company $10,000 for which they received an unsecured promissory note from the
Company payable within 20 days after final resolution of the Wal-Mart
litigation. In addition, the Company agreed to pay to each of Messrs. Hood and
Young one percent of any recovery (net of legal fees and costs related to the
litigation) received as a result of the Wal-Mart litigation. The Company and
Wal-Mart entered into a new contract effective as of September 1, 1995, in
settlement of the litigation. Pursuant to the Company's calculation of the net
recovery to be received from the Wal-Mart contract entered into in settlement of
the litigation, each of Messrs. Hood and Young are entitled to receive
approximately $50,056.
During the first quarter of 1995, the Company completed a private placement
of notes and warrants for an aggregate consideration of $200,000. The notes
issued in the offering bear interest at a rate of 10% per annum and principal
and interest on the notes were due and payable on or before 20 days after the
final resolution, by settlement, judgment or otherwise, of the Wal-Mart
litigation. Each warrant issued entitled the holder thereof to purchase one
share of Common Stock at an exercise price of $0.20 per share at any time
within two years of the date of issuance. In addition, the Company agreed to pay
to the investors a total of 10% of the net recovery from the Wal-Mart lawsuit or
any settlement thereof. Investors in the private placement included Messrs.
Hood, Young and Barrett, directors of the Company, and Robert W. Davis and
William S. Atherton, each an owner of more than five percent of a class of the
Company's outstanding securities. The following table sets forth certain
information with respect to the securities acquired by such purchasers in the
private placement:
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<PAGE>
<TABLE>
<CAPTION>
Number of
Shares Principal Net
Aggregate Cash Underlying Amount Recovery
Name Consideration Warrants of Notes Amount(1)
- ---- ------------- -------- -------- ---------
<S> <C> <C> <C> <C>
Chuck H. Hood $ 5,000 12,500 $ 5,000 $12,514
Gary W. Young 5,000 12,500 5,000 12,514
J. Larre Barrett 20,000 50,000 20,000 50,056
Robert W. Davis 10,000 25,000 10,000 25,028
William S. Atherton 20,000 50,000 20,000 50,056
- --------------
</TABLE>
(1) Represents each investor's interest in the net after tax cash flow
estimated to be received under the Wal-Mart contract which was entered into
in settlement of the litigation. The Company has calculated the total net
after tax cash flow recovery from such contract to equal $5,005,000.
On November 30, 1995, Messrs. Barrett, Davis and Atherton exercised their
warrants to purchase the underlying shares of Common Stock in exchange for one-
half of the outstanding principal balance of the notes covered in the private
placement. At such date, the Company issued replacement notes to Messrs.
Barrett, Davis and Atherton in the amounts of approximately $11,468, $5,835 and
$11,671, respectively, representing the remaining outstanding principal balance
on the original notes and accrued interest on the original notes through such
date. Principal and interest are due and payable on such notes on or before
June 30, 1997. In addition, on such date Mr. Hood and Mr. Young exchanged the
notes purchased in the offering for new notes each in the principal amount of
$5,347 (representing the outstanding principal balance of the original notes and
accrued interest thereon through such date), which notes mature as to principal
and interest on June 30, 1997.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of
the Company's Common Stock, to report their initial ownership of the Company's
Common Stock and any subsequent changes in that ownership to the Securities and
Exchange Commission ("SEC") and The Nasdaq Stock Market, and to furnish the
Company with a copy of each such report. SEC regulations impose specific due
dates for such reports, and the Company is required to disclose in this Proxy
Statement any failure to file by these dates during and for fiscal 1994.
To the Company's knowledge, based solely on the review of the copies
of such reports furnished to the Company and written representations that no
other reports were required, during and with respect to fiscal 1995, all Section
16(a) filing requirements applicable to its executive officers, directors and
more than ten percent stockholders were complied with, except that Charles H.
Hood, Gary W. Young and J. Larre Barrett each inadvertently failed to timely
file a statement on Form 4 with respect to the acquisition by each of common
stock purchase warrants and Mr. Barrett also inadvertently failed to timely
report the exempt exercise of the common stock purchase warrants on a year-end
Form 5.
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OTHER MATTERS
Matters Which May Come Before the Annual Meeting
The Board of Directors knows of no matters other than those described
in this Proxy Statement which will be brought before the Annual Meeting for a
vote of the stockholders. If any other matter properly comes before the Annual
Meeting for a stockholder's vote, the persons named in the accompanying proxy
will vote thereon in accordance with their best judgment.
Proposals of Stockholders
Proposals of stockholders intended to be presented at the Company's
1997 Annual Meeting of Stockholders must be received at the principal executive
offices of the Company, 5100 East Skelly Drive, Meridian Tower, Suite 1080,
Tulsa, Oklahoma 74135, on or before February 18, 1997, to be considered for
inclusion in the Company's proxy statement and accompanying proxy for that
meeting.
By Order of the Board of Directors.
Lynnwood R. Moore, Jr.
Secretary
June 18, 1996
Tulsa, Oklahoma
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<PAGE>
PROXY
ADDVANTAGE MEDIA GROUP, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints Charles H. Hood and Gary W. Young as Proxies,
each with the power to appoint his or her substitute, and hereby authorizes them
to represent and to vote, as designated below, all the shares of common stock of
ADDvantage Media Group, Inc. (the "Company") held of record by the undersigned
on May 31, 1996, at the Annual Meeting of Stockholders of the Company to be held
on July 18, 1996, and at any and all adjournments or postponements thereof.
1. Election of directors.
[_] FOR all nominees listed below (except as indicated to the contrary
below and subject to the discretion of the proxies as provided herein).
J. Larre Barrett John W. Condon Charles H. Hood Gary W. Young
[_] WITHHOLD AUTHORITY to vote for all the nominees above.
Instructions: To withhold authority for any individual nominee or nominees,
write their name(s) here:
________________________________________________________________________________
(Continued and to be signed on the reverse side)
2. Proposal to approve the appointment of Tullius Taylor Sartain & Sartain as
the independent auditors of the Company.
[_] FOR [_] AGAINST [_] ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
This Proxy when properly executed will be voted at the Annual Meeting or any
adjournments or postponements thereof as directed herein by the undersigned
stockholder. If no specifications are made, this Proxy will be voted FOR
Proposals 1 and 2. This Proxy is revocable at any time before it is exercised.
IMPORTANT: Please date this Proxy
and sign exactly as your name
appears to the left. If shares are
held by joint tenants, both should
sign. When signing as attorney,
executor, administrator, trustee or
guardian, please give title as such.
If a corporation, please sign in
full corporate name by president or
other authorized officer. If a
partnership, please sign in
partnership name by authorized
person.
Dated: ___________________, 1996
Signature(s) ___________________
Signature(s) ___________________
PLEASE MARK, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED ENVELOPE.
NO POSTAGE IS REQUIRED FOR MAILING IN THE UNITED STATES.
