<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (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 Rule 14a-11(c) or Rule 14a-12
ARI Network Services, 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 paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
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<PAGE> 2
ARI NETWORK SERVICES, INC.
330 East Kilbourn Avenue
Milwaukee, Wisconsin 53202
---------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
December 10, 1998
To the Shareholders of ARI Network Services, Inc.:
The 1998 Annual Meeting of Shareholders of ARI Network Services, Inc.
will be held at 330 East Kilbourn Ave., Suite 725, Milwaukee, Wisconsin, on
Thursday, December 10, 1998 at 9:00 a.m., local time, for the following
purposes:
1. To elect two directors to serve until 2001.
2. To amend the Company's 1991 Incentive Stock Option Plan to increase
the number of shares reserved thereunder from 500,000 to 850,000.
3. To amend the Company's 1993 Director Stock Option Plan to increase
the number of shares reserved thereunder from 75,000 to 150,000.
4. To amend the Company's 1992 Employee Stock Purchase Plan to increase
the number of shares reserved thereunder from 12,500 to 62,500.
5. To ratify the appointment of Ernst & Young LLP as independent auditors.
6. To amend the terms of the Company's Series A Preferred Stock.
7. To transact such other business as may properly come before the meeting.
Shareholders of record at the close of business on October 26, 1998 are
entitled to notice of and to vote at the meeting and at all adjournments
thereof.
HOLDERS OF A MAJORITY OF THE OUTSTANDING SHARES MUST BE PRESENT IN
PERSON OR BY PROXY IN ORDER FOR THE MEETING TO BE HELD. SHAREHOLDERS ARE URGED
TO DATE, SIGN AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE WHETHER
OR NOT THEY EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON. IF YOU ATTEND THE
MEETING AND WISH TO VOTE YOUR SHARES PERSONALLY, YOU MAY DO SO BY REVOKING YOUR
PROXY AT ANY TIME PRIOR TO THE VOTING THEREOF.
Mark L. Koczela, Secretary
November 9, 1998
2
<PAGE> 3
ARI NETWORK SERVICES, INC.
330 East Kilbourn Avenue
Milwaukee, Wisconsin 53202
PROXY STATEMENT
The Board of Directors of ARI Network Services, Inc. (the "Company")
submits the enclosed proxy for the annual meeting to be held on the date, at the
time and place and for the purposes set forth in the accompanying Notice of
Annual Meeting of Shareholders. Each shareholder of record at the close of
business on October 26, 1998 will be entitled to one vote for each share of
Common Stock registered in such shareholder's name. As of October 26, 1998, the
Company had outstanding 5,087,462 shares of Common Stock. The presence, in
person or by proxy, of a majority of the shares of Common Stock outstanding on
the record date is required for a quorum at the meeting. This Proxy Statement
and the accompanying proxy and Annual Report to Shareholders are being sent to
the Company's shareholders commencing on November 9, 1998.
Any shareholder executing and delivering the enclosed proxy may revoke
the same at any time prior to the voting thereof by written notice of revocation
given to the Secretary of the Company.
UNLESS OTHERWISE DIRECTED, ALL PROXIES WILL BE VOTED FOR THE ELECTION OF
EACH OF THE INDIVIDUALS NOMINATED TO SERVE AS DIRECTORS AND FOR EACH OF THE
OTHER PROPOSALS. DIRECTORS WILL BE ELECTED BY A PLURALITY OF VOTES CAST AT THE
MEETING (ASSUMING A QUORUM IS PRESENT) UP TO THE MAXIMUM NUMBER OF DIRECTORS TO
BE CHOSEN. THE AFFIRMATIVE VOTE OF A MAJORITY OF THE SHARES OF COMMON STOCK
PRESENT IN PERSON OR BY PROXY AT THE ANNUAL MEETING (ASSUMING A QUORUM IS
PRESENT) IS REQUIRED TO APPROVE THE AMENDMENTS TO THE STOCK PLANS. THE OTHER
PROPOSALS WILL BE APPROVED IF THE AFFIRMATIVE VOTES EXCEED THE VOTES CAST
AGAINST. IN ADDITION, THE HOLDER OF THE SERIES A PREFERRED STOCK MUST APPROVE
THE AMENDMENT TO THE TERMS OF THE SERIES A PREFERRED STOCK. BROKER NON-VOTES ARE
COUNTED ONLY FOR PURPOSES OF DETERMINING WHETHER A QUORUM IS PRESENT AT THE
MEETING BUT ARE NOT CONSIDERED PRESENT WITH RESPECT TO THAT MATTER AND,
THEREFORE, WILL HAVE NO EFFECT ON THE OUTCOME OF THE VOTING. ABSTENTIONS WILL
ALSO HAVE NO EFFECT ON THE VOTING, EXCEPT ABSTENTIONS WILL HAVE THE EFFECT OF A
VOTE AGAINST THE STOCK PLAN PROPOSALS.
3
<PAGE> 4
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information regarding the
beneficial ownership of shares of Common Stock by each person known by the
Company to beneficially own 5% or more of the Common Stock, by each director or
nominee of the Company, by certain executive officers of the Company, and by all
directors and executive officers of the Company as a group as of September 30,
1998.
<TABLE>
<CAPTION>
NAME OF AMOUNT AND NATURE OF
BENEFICIAL OWNERS BENEFICIAL OWNERSHIP (1) PERCENT
----------------- ----------------------- -------
<S> <C> <C>
WITECH Corporation (2)(3) 930,186 17.4%
N16 W23217 Stone Ridge Dr.
Waukesha, WI 53188
Briggs & Stratton Corporation 840,000 16.5%
12301 West Wirth Street
Milwaukee, WI 53201
Vulcan Ventures Incorporated (4) 508,198 10.0%
110 110th Avenue, N.E.
Bellevue, WA 98004
State of Wisconsin Investment Board 391,875 7.7%
121 W. Wilson Street
Madison, WI 53703
RPI Holdings, Inc. (5)(6) 306,815 6.0%
111 East Kilbourn Avenue
Milwaukee, WI 53202
AXA-UAP 292,353 5.7%
23 Avenue Matignon
75008 Paris, France
William H. Alverson (7) 6,213 *
John C. Bray (8) 30,375 *
Gordon J. Bridge (9) 36,000 *
Francis Brzezinski (3)(10) 6,250 *
George D. Dalton (11) 9,938 *
Brian E. Dearing (12) 103,641 2.0%
Mark L. Koczela (13) 55,628 1.1%
Michael E. McGurk (14) 21,376 *
Eric P. Robison (4)(15) 4,575 *
Richard W. Weening (16) 28,970 *
All executive officers and 302,966 5.6%
directors as a group (10 person)
(17)
</TABLE>
- ------------
*Less than 1%
(1) Except as otherwise noted, the persons named in the above table have sole
voting and investment power with respect to all shares shown as
beneficially owned by them. Indicated options and warrants are exercisable
within 60 days of September 30, 1998.
(2) WITECH's shares include 250,000 shares subject to warrants. Excludes
20,000 shares of non-voting, non-convertible Series A Preferred Stock (the
entire series) also owned by WITECH.
(3) Mr. Brzezinski is an officer and director of WITECH and has voting control
of the Common Stock held by WITECH.
(4) Mr. Robison is a Business Development Associate of Vulcan, N.W., an
affiliate of Vulcan Ventures Incorporated.
(5) Includes 15,157 shares subject to a warrant.
(6) Mr. Alverson and Mr. Weening are shareholders and directors of RPI
Holdings, Inc. ("RPI").
(7) Includes options for 4,963 shares. Mr. Alverson's shares exclude any
shares held by RPI.
(8) Includes options for 29,125 shares.
(9) Includes options for 36,000
shares.
(10) Includes options for 6,000 shares. Mr. Brzezinski's total excludes any
shares held by WITECH.
(11) Includes options for 8,688 shares.
(12) Includes options for 101,141
shares.
(13) Includes options for 54,378 shares.
(14) Includes options for
18,876 shares.
(15) Includes options for 4,575 shares. Mr. Robison's shares exclude any
shares held by Vulcan.
(16) Includes a warrant for 15,157 shares. Mr. Weening's total excludes any
shares held by RPI.
(17) Includes options and warrants for 278,903 shares. Excludes shares held by
WITECH, Vulcan or RPI.
4
<PAGE> 5
ELECTION OF DIRECTORS
The Company's directors are divided into three classes, with staggered
terms of three years each. At the meeting, shareholders will elect two directors
to serve until 2001.
NOMINEES FOR ELECTION TO SERVE
UNTIL THE ANNUAL MEETING IN 2001
BRIAN E. DEARING, 43; Mr. Dearing, a director since 1995, is Chairman,
President, Chief Executive Officer and Acting Chief Financial Officer of the
Company. Prior to joining the Company, Mr. Dearing held the position of Vice
President - EDI Business Development in London, England, with Sterling Software,
Inc. Since 1990, Mr. Dearing held a series of electronic commerce executive
positions at Sterling including Vice President of Marketing and Vice President
of Customer Service for Sterling's North American EDI business, as well as Vice
President of European Network Services. Prior to joining Sterling, Mr. Dearing
was Manager of EDI Market Development and Manager of EDI Product Management with
General Electric Information Services. Mr. Dearing holds a Masters Degree in
Industrial Administration from Krannert School of Management at Purdue
University and a BA in Political Science from Union College. He also spent a
year of undergraduate studies at the London School of Economics.
RICHARD W. WEENING, 52; Mr. Weening, a director since 1981, is Executive
Chairman and Chief Executive Officer of Cumulus Media Inc. Mr. Weening organized
the Company in 1981 as a business information publishing subsidiary of Raintree
Publishers, Inc., now known as RPI Holdings, Inc. ("RPI"). He served as
President and Chief Executive Officer of the Company until October 1987 and
Chairman and Chief Executive Officer of the Company until October 1990. Mr.
Weening is also the President and Chief Executive Officer of QUAESTUS Management
Corporation, a private equity investment management firm. From 1972 to present
Mr. Weening has also served as President of RPI, a significant shareholder of
the Company. See "Security Ownership of Certain Beneficial Owners".
DIRECTORS WHOSE TERMS
EXPIRE AT THE ANNUAL MEETING IN 2000
GEORGE D. DALTON, 69; Mr. Dalton, a director since March, 1994, is
Chairman and Chief Executive Officer and a director of Fiserv Inc., a major
provider of data processing outsourcing and related products and services for
financial institutions. Mr. Dalton was one of the original investors in Fiserv
when it was formed in 1984. Mr. Dalton also serves as a board member on APAC
TeleServices, Inc. and Clark/Bardes Holdings, Inc.
GORDON J. BRIDGE, 56; Mr. Bridge, a director since December 1995, is
Chairman of the Board and a director of CONNECT, Inc., an electronic commerce
services company. Mr. Bridge was with AT&T where he held various executive
management positions from 1988 to 1995. Most recently, Mr. Bridge served as Vice
President, Corporate Strategy for Emerging Services and Products for AT&T. He
previously managed three business units for AT&T, including Consumer Interactive
Services, EasyLink Services and Computer Systems. Prior to joining AT&T, Mr.
Bridge was with the IBM Corporation for 23 years. Mr. Bridge holds a B.A. in
mathematics from Bradley University.
DIRECTORS WHOSE TERMS
EXPIRE AT THE ANNUAL MEETING IN 1999
ERIC P. ROBISON, 39; Mr. Robison, a director since 1994, is a business
development associate for Vulcan Ventures Inc. in Bellevue, Washington, the
investment company of Paul G. Allen, co-founder of Microsoft. From 1991 to 1994
when he joined Vulcan, Mr. Robison was co-founder and vice president of The
Stanton Robison Group, Inc., a business development, marketing and advertising
consulting firm. Mr. Robison currently serves on the Board of Directors of
Egghead.com, Inc. and CNET, Inc.
WILLIAM H. ALVERSON, 65; Mr. Alverson, a director since 1983, is a
shareholder of Godfrey & Kahn, S.C., a Milwaukee law firm where he has been
employed since 1966.
5
<PAGE> 6
FRANCIS BRZEZINSKI, 47; Mr. Brzezinski, a director since 1990, is Vice
President, Wisconsin Energy Corporation and President of its real estate and
venture subsidiaries WISPARK, WITECH, Minergy and WISVEST.
The Board of Directors held ten meetings in fiscal 1998. Each incumbent
director, except Mr. Robison, attended 75 percent or more of the combined number
of meetings of the Board and Committees on which such director served.
The Company's Board of Directors has established an Executive Committee
that currently is composed of Mr. Dearing, Mr. Bridge, Mr. Brzezinski and Mr.
Weening. Mr. Bridge serves as Chairman of the Executive Committee. The duties of
the Executive Committee are to review the monthly management report with the
CEO; act as a resource to the CEO in the development of the Company's business
plan, overall business strategy and any other matter which the CEO or any member
deems appropriate. The Executive Committee also considers and acts upon matters
requiring Board consideration between regular meetings of the full Board not
prohibited by law or by the by-laws of the Company. The Executive Committee also
reviews and approves compensation including base salary, benefits, bonus and
(subject to the review and approval of the Stock Option Committee) stock option
awards for the CEO and the CEO recommendations for all management level
employees. The Executive Committee also reviews and makes recommendations to the
Board as to appropriate action regarding any and all matters of corporate
finance, acquisitions, the sale of stock, the incurrence of debt and the sale of
assets. The Executive Committee met five times during fiscal 1998.
The Company's Board of Directors has established an Audit Committee that
currently is composed of Mr. Brzezinski and Mr. Alverson. The duties of the
Audit Committee are to evaluate the independent auditors; to make
recommendations as to the selection of independent auditors; to review the audit
plan and scope with the independent auditors; to review audit results; to review
transactions between management and the Company; to review reports of the
accounting staff of the Company and its auditors as to the adequacy of its
system of internal controls; and to make appropriate inquiries respecting
financial matters to the auditors and others. The Audit Committee met once
during fiscal 1998.
The Company's Board of Directors has established a Stock Option
Committee that currently is composed of Mr. Brzezinski, Mr. Alverson and Mr.
Dalton. The duties of the Stock Option Committee are to administer the Company's
1991 Incentive Stock Option Plan, the 1992 Employee Stock Purchase Plan and the
1993 Director Stock Option Plan. The Stock Option Committee took action by
consent resolution, but did not meet in fiscal 1998.
The Board of Directors does not have a nominating committee, as
decisions regarding Board membership are made by the full Board.
Each non-employee member of the Board of Directors is compensated under
the Director Stock Option Plan in lieu of any cash compensation. Under the Plan,
each director receives options for 125 shares on the first day of each calendar
year and receives options for an additional 250 shares for each meeting of the
Board and 87 shares for each meeting of a Committee attended by the director. On
February 11, 1998, a one time special grant of a ten year option covering 2,500
shares exercisable at $4.00 per share was issued to each member of the Board
except Mr. Dearing and Mr. Bridge. In his role as Chairman of the Executive
Committee of the Board of Directors, in October 1996, Mr. Bridge was granted a
special ten year option to acquire 30,000 shares at $2.50 per share. Under this
agreement, Mr. Bridge will not be qualified to receive other options under the
Plan until November 2001.
6
<PAGE> 7
EXECUTIVE COMPENSATION
The following table sets forth compensation for the last three fiscal
years for each of the Company's executive officers whose salary and bonus during
fiscal 1998 exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
---------------------------- ------------
Name and Securities
Principle Position Other Underlying
------------------ Year Salary Bonus Annual Options/SARs All Other
---- ------ ----- Compensation (#) Compensation
------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Brian E. Dearing, 1998 $150,000 $38,829 $ -- 24,000 $ --
Chairman and Chief 1997 150,000 33,683 -- 25,000 --
Executive Officer (1) 1996 109,615 4,167 -- 87,500 19,086
Mark L. Koczela, 1998 $125,000 $33,562 $ -- 32,500 $ --
Executive Vice 1997 125,000 38,947 -- 25,000 --
President of 1996 125,000 10,000 -- 0 --
Business Development
& Administration
John C. Bray, Vice 1998 $130,000 $15,204 $11,810 16,500 $ --
President of Sales 1997 110,000 19,801 21,402 37,500 --
(2)
Michael E. McGurk, 1998 $100,000 $19,579 $ -- 16,500 $ --
Vice President of 1997 53,846 18,343 -- 28,125 --
Technology (3)
</TABLE>
- --------------
(1) Mr. Dearing's employment with the Company commenced November 13, 1995.
(2) Mr. Bray's employment with the Company commenced September 30, 1996. Other
annual compensation consists of commission paid on new sales.
(3) Mr. McGurk's employment with the Company commenced January 20, 1997.
7
<PAGE> 8
The table below provides information regarding option grants in the year
ended July 31, 1998 to the persons named in the Summary Compensation Table
pursuant to the Company's 1991 Stock Option Plan.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO
OPTIONS/SARS EMPLOYEES IN EXERCISE OR BASE
NAME GRANTED # (1) FISCAL YEAR (1) PRICE ($/SHARE) EXPIRATION
---- ------------ --------------- --------------- ----------
<S> <C> <C> <C> <C>
Brian E. Dearing 24,000 11.9% $2.25 6/08
Mark L. Koczela 12,500 6.2% $4.00 12/07
20,000 10.0% $2.25 6/08
John C. Bray 16,500 8.2% $2.25 6/08
Michael E. McGurk 16,500 8.2% $2.25 6/08
</TABLE>
- -------------------
(1) All options granted in the fiscal year were awarded with an exercise price
equal to the fair market value of the Common Stock on the date of grant.
Under the terms of the Plan, the Stock Option Committee retains discretion
to, among other things, accelerate the exercise of an option, modify the
terms of outstanding options (including decreasing the exercise price),
and permit the exercise price and tax withholding obligations related to
exercise to be paid by delivery of already owned shares or by offset of
the underlying shares.
The table below provides information regarding the exercises of stock
options during fiscal 1998 and the value of stock options held at July 31, 1998
by the persons named in the Summary Compensation Table.
AGGREGATED OPTION/SAR EXERCISES
IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTION/SARS AT IN-THE-MONEY OPTIONS
ACQUIRED VALUE FISCAL YEAR END (#) AT FISCAL YEAR END
NAME ON EXERCISE (#) REALIZED ($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- --------------- ------------ ------------------------- -------------------------
<S> <C> <C> <C> <C>
Brian E. Dearing -- -- 91,417/45,083 $0/$0
Mark L. Koczela -- -- 54,378/36,875 $0/$0
John C. Bray -- -- 29,125/24,875 $0/$0
Michael E. McGurk -- -- 18,876/25,749 $0/$0
</TABLE>
The Company and Mr. Dearing are parties to a letter dated October 20,
1995 describing the terms of his employment. Mr. Dearing receives an annual base
salary of $150,000 and is eligible to receive a $75,000 bonus if he meets the
objectives set jointly by the Board of Directors and Mr. Dearing. In connection
with his employment letter, Mr. Dearing was granted options for 87,500 shares of
the Company's common stock at a price of $6.50 per share. The options vested
over a three year period ending October 20, 1998.
8
<PAGE> 9
CERTAIN TRANSACTIONS
The Company and QUAESTUS Management Corporation, an affiliate of RPI,
were parties to a consulting agreement that was terminated effective October 31,
1997. During fiscal 1998, the Company paid $37,509 (including out-of-pocket
expenses) for consulting services before the agreement was terminated. The
Company paid no fee or other consideration in connection with the termination of
the agreement.
The Company and Mr. Weening were also parties to a consulting agreement
that was terminated effective October 31, 1997. In accordance with the
consulting agreement, upon termination of the agreement, the Company paid Mr.
Weening $125,000, but was released from ongoing obligations to provide health
and disability insurance. The Company assigned to Mr. Weening two split dollar
life insurance policies on Mr. Weening's life with an accumulated cash surrender
value of approximately $214,400. Mr. Weening agreed that such amount would be
paid to the Company upon Mr. Weening's death out of the proceeds of the policy
payments.
Mr. Alverson is a shareholder of the law firm of Godfrey & Kahn, S.C.,
which the Company retains from time to time to perform legal services.
The Company has a line of credit with WITECH Corporation (the "WITECH
Line") that has been in place since October 4, 1993. In January 1998, the WITECH
Line was extended from December 31, 1997 to December 31, 1998 and the size of
the facility reduced from $2.0 million to $1.2 million. In connection with this
amendment, the Company issued WITECH a warrant to purchase 25,000 shares of
stock, exercisable until December 31, 2001 at $4.00 per share. In May 1998, the
WITECH Line was extended until December 31, 2001 and the size of the facility
increased from $1.2 million to $2.0 million. In connection with this amendment,
the Company issued WITECH a warrant for 25,000 shares and a usage warrant for up
to 25,000 shares, each exercisable until December 31, 2001 at $2 13/16 per
share. On September 14, 1998, the Company and WITECH executed an amendment to
the WITECH Line to increase the size of the loan facility from $2.0 million to
$2.8 million (the "Loan Amendment"). The Loan Amendment also provided that the
size of the facility would be reduced (but not below $2.0 million) to the extent
of the proceeds received from stock offerings conducted by the Company, if any.
In connection with the Loan Amendment, the Company agreed to issue 250 shares of
Preferred Stock to WITECH. See "Proposal to Amend Terms of Series A Preferred
Stock - The Loan Agreement." Since the inception of the WITECH Line, the Company
has issued warrants for an aggregate of 250,000 shares of Common Stock. The
exercise price is $4.00 per share for all warrants, except the warrants issued
in May 1998. The exercise price of the warrants is reduced if the Company sells
Common Stock for less than the then current exercise price. Borrowings under the
WITECH Line bear interest at prime plus 2.0%. As of September 30, 1998,
$1,980,000 was outstanding under the WITECH Line.
On September 15, 1998, the Company purchased from Briggs & Stratton
Corporation ("Briggs") the assets of Briggs' POWERCOM-2000 operating division.
POWERCOM-2000 was in the business of providing electronic commerce software and
services to companies primarily in the outdoor power, power tool and power
sports industries. In connection with the acquisition, the Company assumed
certain liabilities of the business and issued to Briggs 840,000 shares of
Common Stock. Briggs received "piggyback" registration rights with respect to
its shares and the right, after September 15, 1999, to require the Company to
register its shares for resale. Briggs also agreed to become a customer of the
Company and executed an agreement whereby the Company will provide certain
software and services to enable Briggs to engage in electronic commerce
transactions with its distributors and dealers.
In addition, Briggs agreed to provide the Company with a working capital
line of credit in the amount of $250,000 (the "Briggs Line") which expires April
30, 1999. The Company has agreed to exhaust all available credit under the
WITECH Line before borrowing any amounts under the Briggs Line. The Briggs Line
bears interest at prime plus 2% and is secured by a first position lien against
all accounts receivable generated from customers of POWERCOM-2000 that were
assigned to the Company as part of the acquisition. Borrowings under the Briggs
Line (if any) must be repaid with the proceeds of equity offerings (if any) in
excess of $800,000 plus accrued interest on the WITECH Line.
9
<PAGE> 10
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely upon its review of Forms 3, 4 and 5 and amendments thereto
furnished to the Company pursuant to Section 16 of the Securities Exchange Act
of 1934, as amended, all of such forms were filed on a timely basis by reporting
persons, except Mr. Weening filed one late Form 5 with respect to four stock
option grants received during fiscal 1998.
PROPOSAL TO APPROVE AMENDMENT TO THE
INCENTIVE STOCK OPTION PLAN
At the annual meeting, shareholders are being asked to approve an
amendment to the Company's 1991 Incentive Stock Option Plan (the "ISOP") in
order to increase the number of shares reserved for issuance thereunder from
500,000 to 850,000. There are currently no shares available for issuance under
the ISOP. The Company believes that the amendment to the ISOP is an important
factor in promoting the interests of the Company and its shareholders by making
additional shares available for grant to employees. The grant of options to
employees of the Company helps to align the interests of the Company's
shareholders and its employees.
DESCRIPTION OF INCENTIVE STOCK OPTION PLAN
The ISOP was adopted by the Board of Directors on July 31, 1991 and was
approved by shareholders on September 20, 1991. In 1996, shareholders approved
an increase in the number of shares reserved under the ISOP from 375,000 to
500,000.
All employees of the Company are eligible to receive options under the
ISOP. At October 1, 1998, approximately 100 persons were eligible. The ISOP is
designed to provide additional incentive compensation to employees and provide
them with an opportunity to acquire an equity interest in the Company.
The ISOP is administered by a Stock Option Committee appointed by the
Board of Directors. Messrs. Alverson, Brzezinski, and Dalton are the current
members of the Stock Option Committee. Subject to the provisions of the ISOP,
the Stock Option Committee has the authority to determine the exercise prices
applicable to the options, the eligible employees to whom and the time or times
at which options shall be granted, the number of shares of Common Stock subject
to each option, and the extent to which options may be exercisable in
installments, and also to interpret the ISOP, and to prescribe, amend and
rescind the rules and regulations pertaining to the ISOP.
Options granted under the ISOP may be either (i) options intended to
qualify as "incentive stock options" under Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code"), or (ii) non-qualified stock options.
Under the ISOP, no employee may be granted options for more than 87,500 shares
during any one-year period. No incentive stock options may be granted under the
ISOP after September 30, 2001.
Any incentive stock option that is granted under the ISOP may not be
granted at a price less than the fair market value of the Common Stock on the
date of grant (or less than 110% of the fair market value in the case of holders
of 10% or more of the total combined voting power of all series of stock of the
Company or of a subsidiary or parent of the Company). Non-qualified stock
options may be granted at the exercise price established by the Stock Option
Committee, which may be less than the fair market value of the Common Stock on
the date of grant. To date, no such non-qualified stock options have been
granted.
Each option granted under the ISOP is exercisable for a period not to
exceed 10 years from the date of grant (or five years in the case of a holder of
more than 10% of the total combined power of all series of stock of the Company
or of a subsidiary or parent of the Company) and shall lapse upon the expiration
of the period, or earlier upon termination of the recipient's employment with
the Company or as determined by the Committee. An option generally may be
exercised for one year following termination of employment due to death or
disability, or 90 days following termination of employment due to retirement at
age 65.
The Board of Directors of the Company may amend the ISOP at any time,
except if shareholder approval is required under tax, securities or any other
applicable law.
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FEDERAL INCOME TAX CONSEQUENCES
The grant and exercise of options issued pursuant to the ISOP should
cause the federal income tax consequences to participating employees and the
Company described below.
INCENTIVE STOCK OPTIONS. Incentive stock options under the ISOP are
intended to be eligible for the favorable federal income tax treatment accorded
"incentive stock options" under Section 422 of the Code. Incentive stock options
generally have the following tax consequences:
There are generally no federal income tax consequences to the optionee
or the Company by reason of the grant or exercise of an incentive stock option.
However, the exercise of an incentive stock option may increase the optionee's
alternative minimum tax liability if any and, to the extent that any incentive
stock option is exercisable during any calendar year with respect to shares
having, as of the grant date, a fair market value exceeding $100,000, such
excess will be treated as a non-qualified stock option.
If an optionee holds stock through exercise of an incentive stock option
for more than two years from the date on which the option is granted and more
than one year from the date on which the shares are transferred to the optionee
upon exercise of the option, any gain or loss on a disposition of such stock
will be long-term capital gain or loss. Generally, if the optionee disposes of
the stock before the expiration of either of these holding periods (a
"disqualifying disposition"), at the time of disposition of the option, the
optionee will realize taxable ordinary income equal to the lesser of (i) the
excess of the fair market value on the date of exercise over the exercise price,
or (ii) the optionee's actual gain, if any, on the purchase and sale. The
optionee's additional gain or any loss upon the disqualifying disposition will
be a capital gain or loss which will be long-term or short-term, depending on
whether the stock was held more than one year.
Upon exercise of an incentive stock option, the excess of the stock's
fair market value on the date of exercise over the option exercise price will
constitute an adjustment in calculating the optionee's alternative minimum tax,
if any.
To the extent the optionee recognizes ordinary income by reason of a
disqualifying disposition, the Company will be entitled to a corresponding
compensation expense deduction in the tax year in which the disposition occurs.
NON-QUALIFIED STOCK OPTIONS. Non-qualified stock options under the ISOP
have the same income tax consequences as described below for the DSOP. The
compensation deduction by the Company upon exercise of non-qualified stock
options by the CEO or any of the other four most highly compensated executive
officers may be limited by Section 162(m) of the Code, which limits the
deductibility of compensation in any one year to $1,000,000 unless the excess
compensation is "performance-based."
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NEW PLAN BENEFITS
It is not determinable what options will be received by any employees
under the ISOP in fiscal 1999. However, the following table provides information
concerning options awarded in fiscal 1998 under the ISOP.
NUMBER OF
NAME OPTIONS(1)
---- -----------
Brian E. Dearing 24,000
Mark L. Koczela 32,500
John C. Bray 16,500
Michael E. McGurk 16,500
All current executive officers as a group 89,500
All current directors who are not executive
officers as a group -0-
All employees who are not executive officers as a
group 112,499
- ----------------------
(1) Additional information concerning the terms and conditions of the options is
set forth above under the heading "Options/SAR Grants in Last Fiscal Year."
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE AMENDMENT
TO THE 1991 INCENTIVE STOCK OPTION PLAN. PROXIES SOLICITED BY THE BOARD OF
DIRECTORS WILL BE VOTED FOR APPROVAL OF THE AMENDMENT UNLESS SHAREHOLDERS
SPECIFY TO THE CONTRARY IN THEIR PROXIES.
PROPOSAL TO APPROVE AMENDMENT TO THE
DIRECTOR STOCK OPTION PLAN
On February 11, 1998, the Board of Directors adopted an amendment to the
Company's Director Stock Option Plan (the "DSOP"), subject to the approval of
the Company's shareholders. The amendment increased the number of shares
available for issuance pursuant to options granted under the DSOP from 75,000
shares to 150,000 shares. The Company believes that the amendment to the DSOP is
an important factor in promoting the interests of the Company and its
shareholders by providing increased incentives for directors of the Company.
Employees of the Company are ineligible to participate in the DSOP.
DESCRIPTION OF DIRECTOR STOCK OPTION PLAN
The DSOP was originally adopted by the Board of Directors on May 21,
1993 and approved by the Company's shareholders on November 12, 1993. In 1996,
the shareholders approved an increase in the number of shares reserved under the
DSOP from 30,000 to 75,000. The number of Shares authorized is subject to
adjustment in the event of certain changes in the capital structure of the
Company. All members of the Company's Board of Directors who are not also
employed by the Company (the "Eligible Directors") are eligible to participate
in the DSOP. The DSOP is administered by a committee appointed by the Board of
Directors.
Under the DSOP, directors are entitled to receive options for 125 shares
on the first day of each calendar year, 250 shares for each Board meeting
attended and 87 shares for each Board Committee meeting attended. Directors are
entitled to receive additional options if and as shall be determined from time
to time by the Board.
The per share purchase price of the stock purchasable under each option
is equal to the closing price of the Company's Common Stock on the date of grant
of such option as reported on the National Association of Securities
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Dealers, Inc. Automated Quotation National Market System ("NASDAQ-NMS"). The
fair market value per share as of October 16, 1998 was $2.00.
Subject to acceleration as provided in the DSOP upon a "triggering
event" (defined generally to include a change of control of the Company),
options granted under the DSOP shall become exercisable for all of the shares
covered thereby one year after the date of grant. Once any portion of an option
becomes exercisable, it remains exercisable for the shortest period of (i) ten
years after the date of grant; (ii) one year after a Director's tenure of the
Board of Directors terminates due to death or disability; or (iii) three months
after a Director's tenure on the Board of Directors terminates for any reason
other than death or disability; provided, however, the Board of Directors may
extend the expiration date of a director's options beyond such one year or three
month periods.
The Board of Directors of the Company may terminate the DSOP or make
such modifications or amendments thereof as it shall deem advisable, including,
but not limited to, such modifications or amendments as it shall deem advisable
to conform to any law or regulation applicable thereto.
OPTIONS GRANTED
During fiscal 1998, options covering a total of 27,708 shares were
granted to directors under the DSOP.
FEDERAL INCOME TAX CONSEQUENCES
The grant and exercise of options issued pursuant to the DSOP should
cause the federal income tax consequences to participating directors and the
Company described below.
Options granted under the DSOP will be non-qualified stock options under
the Code. At the time an option is granted, the optionee will not recognize any
taxable income and the Company will not be entitled to any deduction. When an
optionee exercises an option, the optionee will generally recognize ordinary
income in an amount equal to the excess of the fair market value of the Common
Stock received on the date of exercise over the option exercise price. The
Company will be entitled to a deduction in an amount equal to the income
recognized by the optionee. The basis of the Common Stock received upon the
exercise of an option will be the exercise price paid plus the amount recognized
by the optionee as taxable income attributable to such shares as a result of the
exercise.
When an optionee sells stock acquired by the exercise of an option, the
difference between the amount received and the adjusted tax basis of the stock
will be capital gain or loss if such shares constitute a capital asset in the
hands of the optionee.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE AMENDMENT
TO THE 1993 DIRECTOR STOCK OPTION PLAN. PROXIES SOLICITED BY THE BOARD OF
DIRECTORS WILL BE VOTED FOR APPROVAL OF THE AMENDMENT UNLESS SHAREHOLDERS
SPECIFY TO THE CONTRARY IN THEIR PROXIES.
PROPOSAL TO APPROVE AMENDMENT TO THE
1992 EMPLOYEE STOCK PURCHASE PLAN
The Company's 1992 Employee Stock Purchase Plan (the "ESPP") is intended
to provide an employment incentive to the employees of the Company. The ESPP
originally covered 12,500 shares of Common Stock. All of such shares have been
acquired and no shares are currently available for issuance under the Plan. The
Board of Directors has approved a proposal to make an additional 50,000 shares
available under the ESPP and is submitting this proposal for shareholder
approval, in order, among other reasons, to qualify the ESPP for treatment as a
Section 423 stock purchase plan under the Code.
DESCRIPTION OF EMPLOYEE STOCK PURCHASE PLAN
The ESPP is administered by the Stock Option Committee of the Board of
Directors. In general, all employees of the Company, other then executive
officers, are eligible to participate in the ESPP, provided they meet
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<PAGE> 14
a minimum period of continuous service. As of the date hereof, the Company has
approximately 100 employees eligible to participate in the ESPP. Under the ESPP,
eligible employees may purchase shares annually by payroll deduction, subject to
certain aggregate limitations set forth in the ESPP, at a purchase price equal
to the lower of either 85% of the fair market value of the Company's shares on
the offering commencement date or 85% of the fair market value of the Company's
shares one year from such date.
The Board of Directors of the Company may, from time to time, amend the
ESPP in any respect. However, no amendment may be made without the approval of
the Company's shareholders if shareholder approval is required for such
amendment under applicable tax, securities or other law.
FEDERAL INCOME TAX CONSEQUENCES
Participating employees will not be deemed to have recognized taxable
income upon the purchase of shares and the Company will not be entitled to any
deduction with respect to the shares issued, unless a participating employee
sells the stock within one year or within two years of commencement of the
applicable offering period.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE AMENDMENT
TO THE 1992 EMPLOYEE STOCK PURCHASE PLAN. PROXIES SOLICITED BY THE BOARD OF
DIRECTORS WILL BE VOTED FOR APPROVAL OF THE AMENDMENT UNLESS SHAREHOLDERS
SPECIFY TO THE CONTRARY IN THEIR PROXIES.
RATIFICATION OF INDEPENDENT AUDITORS
The Board of Directors, upon recommendation of its Audit Committee, has
appointed Ernst & Young LLP to audit the books and accounts of the Company and
its subsidiaries for the fiscal year ending July 31, 1999 and is seeking the
ratification of this appointment by the shareholders. It is intended that the
shares represented by the proxy will be voted (unless the proxy indicates to the
contrary) for ratification of the appointment.
A representative of Ernst & Young LLP is expected to be present at the
meeting with the opportunity to make a statement if he or she desires to do so,
and is expected to be available to respond to appropriate questions.
PROPOSAL TO AMEND TERMS OF
SERIES A PREFERRED STOCK
The Board of Directors of the Company has recommended the adoption of
amendments to the terms of the Company's Series A Preferred Stock to (i) permit
additional issuances of Preferred Stock to any holder of Series A Preferred
Stock, and (ii) provide that any new issuance of Series A Preferred Stock could
bear dividends from a day prior to the date of issuance, as determined by the
Board of Directors. All of the outstanding Series A Preferred Stock is currently
held by WITECH. The proposed changes would enable the Company to issue 250
additional shares of Series A Preferred Stock to WITECH, as described below.
DESCRIPTION OF PREFERRED STOCK
The Company's Articles of Incorporation authorize the Company to issue
up to 1 million shares of Preferred Stock, $.001 par value. Within the limits
and restrictions contained in the Articles of Incorporation, the Board of
Directors has the authority, without further action by the shareholders, to
issue one or more series of Preferred Stock. The Board of Directors may fix the
specific terms of the issuance, including: (i) the designation and authorized
number of shares of each series; (ii) any voting rights; (iii) the dividend
rate, the dates on which dividends shall be payable and, the date or dates from
which any such cumulative dividend shall be cumulative; (iv) the amount per
share payable per share of such Preferred Stock in the event of liquidation,
dissolution or winding up the Company; (v) any redemption or sinking fund
provisions of such series; (vi) any conversion rights; and (vii) any additional
terms, limitations and relative rights and preferences not inconsistent with the
laws of the State of Wisconsin or the Articles of Incorporation.
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<PAGE> 15
The Board of Directors has designated a series of Preferred Stock as
Series A Preferred Stock and authorized up to 40,000 shares of Series A
Preferred Stock. Currently, 20,000 shares of Series A Preferred Stock are
outstanding, all of which are held by WITECH.
The terms of the Series A Preferred Stock include the following:
- The Series A Preferred Stock is non-voting, except as required by
law.
- The Series A Preferred Stock is entitled to a cumulative dividend,
when declared by the Board of Directors, equivalent to an interest
rate of prime plus 2%, but not less than 10% nor more than 14%,
based on the $100 per share redemption price for the Series A
Preferred Stock. Prior to August 1, 2002, at the Company's option,
dividends may be paid in additional shares of Series A Preferred
Stock in lieu of cash.
- The Series A Preferred Stock is not convertible into Common Stock.
- The Company can redeem the Series A Preferred Stock at its option
at any time at $100 per share plus accrued and unpaid dividends.
- Upon the liquidation or dissolution of the Company, the holders of
the Series A Preferred Stock are entitled to receive $100 per share
plus accrued and unpaid dividends prior to any distribution to
holders of Common Stock or any other series of Preferred Stock
junior to the Series A Preferred Stock.
- The Company cannot pay dividends on its Common Stock while the
Series A Preferred Stock is outstanding.
- The Company cannot issue any Preferred Stock while the Series A
Preferred Stock is outstanding (except Preferred Stock that is
junior to the Series A Preferred Stock or additional shares of
Series A Preferred Stock in lieu of cash dividends, as noted
above).
As of July 31, 1998, accrued but unpaid dividends on the Series A
Preferred Stock were $221,566.
THE LOAN AMENDMENT
On September 14, 1998, the Company and WITECH executed an amendment to
the WITECH Line to increase the size of the loan facility from $2.0 million to
$2.8 million (the "Loan Amendment"). The Loan Amendment also provided that the
size of the facility would be reduced (but not below $2.0 million) to the extent
of the proceeds received from stock offerings conducted by the Company, if any.
In consideration for the Loan Amendment, the Company agreed to issue to
WITECH 250 additional shares of Series A Preferred Stock, subject to Board of
Directors and shareholder approvals of appropriate amendments to the Company's
Articles of Incorporation to permit such issuance. In the event that such
approvals are not received by December 31, 1998, the Company agreed to issue to
WITECH 250 shares of newly-created Series B Preferred Stock that would be
substantially identical to the Series A Preferred Stock but will be junior to
the Series A Preferred Stock in respect of dividends and other distributions.
The 250 shares of Series A Preferred Stock or Series B Preferred Stock
issued to WITECH would bear dividends from the date of the Loan Amendment.
REASONS FOR AMENDING TERMS OF SERIES A PREFERRED STOCK
In light of the foregoing, the Board of Directors has recommended that
shareholders approve the amendments to the terms of the Series A Preferred Stock
in order to allow the Company to issue 250 shares of Series A Preferred Stock to
WITECH in connection with the Loan Amendment. The existing terms of the Series A
Preferred Stock prohibit any issuances of Preferred Stock (except junior
Preferred Stock or Series A Preferred Stock
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<PAGE> 16
paid as dividends on Series A Preferred Stock). If shareholders do not approve
the amendment, the Company would be required to create a new series of Series B
Preferred Stock (that would constitute "junior" Preferred Stock) in order to
satisfy its obligations under the Loan Amendment. The Company believes that two
series of outstanding Preferred Stock would unduly complicate the Company's
capital structure. WITECH must also vote in favor of the changes and has
indicated that it will do so.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE
AMENDMENTS TO THE TERMS OF THE SERIES A PREFERRED STOCK. PROXIES SOLICITED BY
THE BOARD OF DIRECTORS WILL BE VOTED FOR APPROVAL OF THE AMENDMENTS UNLESS
SHAREHOLDERS SPECIFY TO THE CONTRARY IN THEIR PROXIES.
OTHER MATTERS
OTHER PROPOSED ACTION
The Board of Directors of the Company knows of no other matters which
may come before the meeting. However, if any matters other than those referred
to above should properly come before the meeting, the persons named in the
enclosed proxy will vote such proxy in accordance with their discretion.
SHAREHOLDER PROPOSALS
All proposals of shareholders intended to be presented at the Company's
1999 Annual Meeting must be received by the Company at its executive offices at
least 90 days prior to the meeting in order to be presented at the meeting (and
must otherwise be in accordance with the requirements of the Bylaws of the
Company) and must be received by July 12, 1999 to be considered for inclusion in
the proxy statement for that meeting.
COSTS OF SOLICITATION
The expenses of printing and mailing proxy materials, including
reasonable expenses involved in forwarding materials to beneficial owners of
Common Stock, will be borne by the Company. No solicitation other than by mail
is contemplated, except that officers or employees of the Company may solicit
the return of proxies from certain shareholders by telephone, facsimile or
personal solicitation.
SHAREHOLDERS MAY OBTAIN A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM
10-K AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AT NO COST BY WRITING
TO THE OFFICE OF THE CHIEF EXECUTIVE OFFICER, ARI NETWORK SERVICES, INC., 330 E.
KILBOURN AVENUE, MILWAUKEE, WI 53202.
BY ORDER OF THE BOARD OF DIRECTORS
Mark L. Koczela, Secretary
November 9, 1998
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ARI NETWORK SERVICES, INC.
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned, a shareholder of ARI Network Services, Inc. (the
"Company"), hereby appoints Brian E. Dearing and Mark L. Koczela and each of
them, as proxies, each with the power to appoint a substitute, and hereby
authorizes each of them to represent and to vote, as designated below, all of
the shares of stock of the Company held of record by the undersigned on October
26, 1998, at the 1998 Annual Meeting of shareholders of the Company to be held
on December 10, 1998 at 9:00 a.m. and at any and all adjournments thereof.
1. ELECTION OF DIRECTORS: FOR all nominees below WITHHOLD AUTHORITY
to serve until the Company's to vote for all
2001 Annual Meeting and until nominees listed
their successors are elected below.
and qualified. (except as
marked to the contrary below)
(INSTRUCTIONS: To withhold authority to vote for any individual nominee,
strike a line through that nominee's name in the list below.)
BRIAN E. DEARING AND RICHARD W. WEENING
2. To amend the Company's 1991 Incentive Stock Option Plan to increase the
number of shares reserved thereunder from 500,000 to 850,000.
FOR AGAINST ABSTAIN
3. To amend the Company's 1993 Director Stock Option Plan to increase the number
of shares reserved thereunder from 75,000 to 150,000.
FOR AGAINST ABSTAIN
4. To amend the Company's 1992 Employee Stock Purchase Plan to increase the
number of shares reserved thereunder from 12,500 to 62,500.
FOR AGAINST ABSTAIN
5. To ratify the appointment of Ernst & Young LLP an independent auditors.
FOR AGAINST ABSTAIN
6. To amend the terms of the Company's Series A Preferred Stock.
FOR AGAINST ABSTAIN
7. In their discretion , the proxy holders are authorized to vote upon such
matters as may properly come before the 1998 Annual Meeting and at any
adjournment or postponement thereof.
(Continued and to be signed on the reverse side)
<PAGE> 18
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED "FOR" THE ELECTION OF ALL NOMINEES FOR DIRECTORS, "FOR" THE PROPOSED
AMENDMENT OF THE COMPANY'S 1991 INCENTIVE STOCK OPTION PLAN, "FOR" THE AMENDMENT
OF THE COMPANY'S 1993 DIRECTOR STOCK OPTION PLAN, "FOR" THE PROPOSED AMENDMENT
OF THE COMPANY'S 1992 EMPLOYEE STOCK PURCHASE PLAN, "FOR" THE APPOINTMENT OF
ERNST & YOUNG LLP AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS, AND "FOR" THE
PROPOSED AMENDMENT TO THE TERMS OF THE COMPANY'S SERIES A PREFERRED STOCK.
Please sign exactly as your name appears below. When shares are
held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please
give full 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.
Date:_____________________________________________ , 1998
(Signature of Shareholder)
(Signature of Shareholder - if held jointly)
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENVELOPE
PROVIDED.
