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:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
America Online, 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)(1) 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:
_________________________________________________________________________
Preliminary Copy
AMERICA ONLINE, INC.
22000 AOL Way
Dulles, VA 20166-9323
January 22, 1998
Dear Stockholder,
You are cordially invited to attend a Special Meeting of Stockholders
of America Online, Inc. (the ``Company'') to be held at 4:00 p.m. on
February __, 1998 at the Sheraton Premiere at Tyson's Corner, located at
8661 Leesburg Pike, Vienna, Virginia.
At the Special Meeting, the Company will ask the Stockholders to
approve and adopt an amendment to the Company's Restated Certificate of
Incorporation to increase the authorized number of shares of common stock.
Whether you plan to attend the Special Meeting or not, it is important
that you promptly complete, sign, date and return the enclosed proxy card
in accordance with the instructions set forth on the card. This will ensure
your proper representation at the Special Meeting.
Sincerely,
/s/Stephen M. Case
Stephen M. Case,
Chairman of the Board
YOUR VOTE IS IMPORTANT.
PLEASE REMEMBER TO RETURN YOUR PROXY PROMPTLY
AMERICA ONLINE, INC.
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To be Held February __, 1998
To the Stockholders of America Online, Inc.
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of
America Online, Inc., a Delaware corporation (the ``Company''), will be
held on February __, 1998 at the Sheraton Premiere at Tyson's Corner,
located at 8661 Leesburg Pike, Vienna, Virginia at 4:00 p.m. for the
following purposes:
1. To amend the Company's Restated Certificate of Incorporation to
increase the authorized number of shares of common stock from 300,000,000
to 600,000,000.
2. To transact such other business as may be properly brought before
the Special Meeting and any adjournments thereof.
The Board of Directors has fixed the close of business on January 14,
1998 as the record date for the determination of Stockholders entitled to
notice of and to vote at the Special Meeting and at any adjournments
thereof. A list of such Stockholders will be available for inspection at
the place of the Special Meeting, during ordinary business hours for the
ten-day period prior to the Special Meeting.
All Stockholders are cordially invited to attend the Special Meeting.
However, to ensure your representation, you are requested to complete,
sign, date and return the enclosed proxy as soon as possible in accordance
with the instructions on the proxy card. A return addressed envelope is
enclosed for your convenience.
BY ORDER OF THE BOARD OF DIRECTORS
/s/George Vradenburg, III
George Vradenburg, III
Secretary
Dulles, Virginia
January 22, 1998
AMERICA ONLINE, INC.
22000 AOL Way
Dulles, Virginia 20166-9323
(703) 448-8700
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of America Online, Inc. (the ``Company'' or
"America Online"), a Delaware corporation, of proxies, in the accompanying
form, to be used at the Special Meeting of Stockholders to be held at the
Sheraton Premiere at Tyson's Corner, located at 8661 Leesburg Pike, Vienna,
Virginia on February __, 1998 at 4:00 p.m., and any adjournments thereof
(the ``Meeting'').
Where the Stockholder specifies a choice on the proxy as to how his or
her shares are to be voted, the shares will be voted accordingly. If no
choice is specified, the shares will be voted FOR the amendment of the
Company's Restated Certificate of Incorporation to increase the authorized
number of shares of the Company's common stock, par value $.01 per share
("Common Stock"), from 300,000,000 to 600,000,000. A proxy may be revoked
by written instrument delivered to the Company at any time before the proxy
is voted. Any Stockholder who has executed a proxy but is present at the
Meeting, and who wishes to vote in person, may do so by revoking his or her
proxy as described in the preceding sentence. Shares represented by valid
proxies in the form enclosed, received in time for use at the Meeting and
not revoked at or prior to the Meeting, will be voted at the Meeting. The
presence, in person or by proxy, of the holders of a majority of the
outstanding shares of the Company's Common Stock, is necessary to
constitute a quorum at the Meeting. With respect to the tabulation of
proxies for purposes of constituting a quorum, abstentions and broker non-
votes are treated as present, and with respect to the tabulation of proxies
for purposes of the proposal to amend the Company's Restated Certificate of
Incorporation, abstentions and broker non-votes are treated as votes
against the proposal.
The close of business on January 14, 1998 has been fixed as the record
date for determining the Stockholders entitled to notice of and to vote at
the Meeting. As of that date, the Company had 104,173,306 shares of Common
Stock outstanding and entitled to vote. Holders of Common Stock are
entitled to one vote per share on all matters to be voted on by
Stockholders. This Proxy Statement and the accompanying proxy are being
mailed on or about January 22, 1998 to all Stockholders entitled to notice
of and to vote at the Meeting.
The cost of soliciting proxies, including expenses in connection with
preparing and mailing this Proxy Statement, will be borne by the Company.
In addition, the Company will reimburse brokerage firms and other persons
representing beneficial owners of Common Stock of the Company for their
expenses in forwarding proxy material to such beneficial owners.
Solicitation of proxies by mail may be supplemented by telephone, telegram,
telex, and personal solicitation by the directors, officers or employees of
the Company. No additional compensation will be paid to directors,
officers or employees for such solicitation. The Company has retained
Georgeson & Company, Inc. to assist in the solicitation of proxies, for a fee
estimated to be approximately $____ plus reasonable out-of-pocket expenses.
SHARE OWNERSHIP
The following table sets forth certain information as of December 31,
1997, concerning the ownership of Common Stock by (i) each stockholder of
the Company known by the Company to be the beneficial owner of more than 5%
of its outstanding shares of Common Stock, (ii) each current member of the
Board of Directors of the Company, (iii) the Company's five most highly
compensated executive officers (measured as of fiscal year 1997) and (iv)
all current directors and executive officers of the Company as a group.
<TABLE>
Shares Beneficially
Owned (1)
Name and Address* Number Percent
<S> <C> <C>
Over 5% Stockholders:
The Capital Group Companies, Inc. and 12,833,220 12.3%
Capital Research and Management
Company (2)(3)
333 South Hope Street
Los Angeles, California 90071
American Century Investments, Inc. (4) 6,609,100 6.3%
4500 Main Street, Suite 400
Kansas City, MO 64111
Putnam Investments, Inc. (2)(5) 7,727,146 7.4%
One Post Office Square
Boston, Massachusetts 02109
Daniel F. Akerson, Director (8) 25,000 **
Bruce R. Bond, President and CEO, ANS 4,500 **
Communications (8)
Stephen M. Case, President and CEO, 2,252,895 2.1%
Chairman of the Board (6)(7)
Frank J. Caufield, Director (8) 179,800 **
Robert J. Frankenberg, Director (8) 55,000 **
General Alexander M. Haig, Jr., 219,360 **
Director (8)
Lennert J. Leader, Senior V. P., CFO, 496,031 **
Treasurer, Chief Accounting
Officer, and Assistant Secretary (7)
Theodore J. Leonsis, President and 402,454 **
CEO, AOL Studios (7)
William N. Melton, Director (7) 375,000 **
Dr. Thomas Middelhoff, Director (9) -0- **
Robert W. Pittman, President and CEO, 145,423 **
AOL Networks, Director (8)
All executive officers and directors 4,658,759 4.3%
as a group
(15 persons) (7)
</TABLE>
_______________
* Addresses are given for beneficial owners of more than 5% of the
Common Stock only.
** Represents beneficial ownership of less than 1% of the Company's
Common Stock.
( 1 ) The number of shares of Common Stock issued and outstanding on
December 31, 1997, was 104,173,306. The calculation of percentages is
based upon the number of shares of Common Stock issued and outstanding
on such date, plus shares of Common Stock subject to options held by the
respective persons on December 31, 1997 and exercisable within 60 days
thereafter. The persons and entities named in the table have sole
voting and dispositive power with respect to all shares shown as
beneficially owned by them, except as described below. Attached to each
share of Common Stock is a Preferred Share Purchase Right to acquire one
one-hundredth of a share of the Company's Series A Junior Participating
Preferred Stock, par value $.01 per share, which Preferred Share
Purchase Rights are not presently exercisable.
( 2 ) Based solely upon information filed with the Securities and Exchange
Commission as of December 31, 1997.
( 3 ) The Capital Group Companies, Inc. reports that it does not have
dispositive or voting power over the reported shares of Common Stock but
may be deemed to "beneficially own" such securities by virtue of Rule
13d-3 under the Securities Exchange Act of 1934, as amended. Capital
Research and Management Company, an investment advisor and wholly-owned
subsidiary of The Capital Group Companies, Inc. reports that it is the
beneficial owner of and has sole dispositive power over 9,914,400 shares
of Common Stock. The remaining shares are reported as being
beneficially owned by other subsidiaries of The Capital Group Companies,
Inc., none of which by itself owns 5% or more of the outstanding
securities.
( 4 ) Based solely on information acquired from the Company's proxy
solicitor as of December 31, 1997.
( 5 ) Putnam Investments, Inc. is a wholly-owned subsidiary of Marsh &
McClennan Companies, Inc. Included in the 7,727,146 shares of Common
Stock beneficially owned by Putnam Investments, Inc., are 6,536,878
shares beneficially owned by Putnam Investment Management, Inc. and
625,384 shares of Common Stock beneficially owned by The Putnam Advisory
Company, Inc., both registered investment advisers and wholly-owned
subsidiaries of Putnam Investments, Inc. Putnam Investments, Inc.
shares voting power with The Putnam Advisory Company, Inc. with respect
to 420,514 shares.
( 6 ) Includes 4,086 shares held by a custodian on behalf of Mr. Case's
minor children under the Uniform Gifts to Minors Act.
( 7 ) Includes shares issuable within 60 days of December 31, 1997, upon
the exercise of options to purchase Common Stock as follows: Mr. Case -
1,692,200; Mr. Melton - 175,000; Mr. Leader - 366,036; Mr. Leonsis -
267,628; and all executive officers and directors as a group -
3,631,568.
( 8 ) Represents shares issuable within 60 days of December 31, 1997 upon
the exercise of options to purchase Common Stock.
( 9 ) Dr. Middelhoff is a Director and a member of the Executive Board of
Bertelsmann AG, a joint venture partner of the Company. Dr. Middelhoff
has been elected as Chairman of the Board of Bertelsmann AG beginning in
October 1998. Dr. Middelhoff disclaims beneficial ownership of
3,609,280 shares of Common Stock owned by Bertelsmann AG.
AMENDMENT OF THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION
TO INCREASE THE AUTHORIZED NUMBER OF SHARES
The Company's Restated Certificate of Incorporation (the "Certificate
of Incorporation") authorizes the issuance of 300,000,000 shares of Common
Stock, $.01 par value and 5,000,000 shares of Preferred Stock, $.01 par
value. As of January 7, 1998, the Board of Directors of the Company
approved an amendment to the Certificate of Incorporation to increase the
authorized number of shares of Common Stock from 300,000,000 to 600,000,000
and to submit the proposed amendment to the Stockholders at the Meeting
called for that purpose.
Purpose and Effect of the Amendment
The general purpose and effect of the proposed amendment to the
Company's Certificate of Incorporation will be to authorize 300,000,000
additional shares of Common Stock. The Board of Directors believes that it
is prudent to have the additional shares of Common Stock available for
general corporate purposes, including acquisitions, equity financings,
grants of stock options, payment of stock dividends, stock splits or other
recapitalizations.
Although the Board of Directors has not decided to effect a stock
split, the Board may decide to effect a stock split if the proposed
increase is approved by the stockholders. The Company has a history of
regular stock splits, having declared three such splits since October 1994,
each of which was effected by dividending one additional share for each
share presently owned. In considering stock splits, the Board's philosophy
continues to be guided by a conviction not only that the Company's
ownership, and the liquidity afforded its stockholders, expands in relation
to the number of shares outstanding, but also that the Company's shares
become more attractive to individual investors when it is possible to
acquire a larger number of them for the same total dollar amount. Securing
Stockholder approval of additional authorized shares prior to the
consideration by the Board of any future stock split is felt by the Company
to be appropriate, given that any such stock split would consume a
substantial portion of the remaining shares currently authorized for
issuance. The Board of Directors considers a number of factors, including
general market conditions, in deciding whether or when to effect a stock
split, and any of these factors could cause the Board to decide against
effecting a stock split at any particular time.
The Company currently has 300,000,000 authorized shares of Common
Stock. As of December 31, 1997, the Company had 104,173,306 shares issued
and outstanding and of the remaining 195,826,694 authorized but unissued
shares, the Company has reserved approximately 3,600,000 shares in
connection with the possible exercise of outstanding warrants, 1,000,000
shares in connection with the possible conversion of outstanding preferred
stock, 3,353,000 shares in connection with the possible conversion of
outstanding convertible subordinated debt, 33,100,000 shares pursuant to
the Company's option plans and 225,000 shares pursuant to the Company's
Employee Stock Purchase Plan.
Except in connection with the reserved shares described above, the
Company currently has no arrangements or understandings for the issuance of
additional shares of Common Stock, although opportunities for acquisitions
and equity financings could arise at any time. If the Board of Directors
deems it to be in the best interest of the Company and the Stockholders to
issue additional shares of Common Stock in the future, the Board of
Directors generally will not seek further authorization by vote of the
Stockholders, unless such authorization is otherwise required by law or
regulations.
The increase in the authorized number of shares of Common Stock could
have an anti-takeover effect. If the Company's Board of Directors desired
to issue additional shares in the future, such issuance could dilute the
voting power of a person seeking control of the Company, thereby deterring
or rendering more difficult a merger, tender offer, proxy contest or an
extraordinary corporate transaction opposed by the Company.
Vote
The affirmative vote of a majority of the outstanding shares of Common
Stock entitled to vote at the Meeting will be required to approve the
amendment to the Company's Certificate of Incorporation increasing the
number of authorized shares of Common Stock from 300,000,000 to
600,000,000.
THE BOARD OF DIRECTORS RECOMMENDS THE APPROVAL OF THE AMENDMENT TO THE
COMPANY'S RESTATED CERTIFICATE OF INCORPORATION TO INCREASE THE AUTHORIZED
SHARES OF COMMON STOCK FROM 300,000,000 TO 600,000,000.
OTHER MATTERS
The Board of Directors knows of no other business which will be
presented to the Meeting. If any other business is properly brought before
the Meeting, it is intended that proxies in the enclosed form will be voted
in respect thereof in accordance with the judgment of the persons voting
the proxies.
STOCKHOLDER PROPOSALS
To be considered for inclusion in the Company's proxy materials
relating to the 1998 Annual Meeting of Stockholders, stockholder proposals
must be received, marked for the attention of: Secretary, America Online,
Inc., 22000 AOL Way, Dulles, Virginia 20166-9323, no later than June 8,
1998.
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING, YOU ARE URGED
TO FILL OUT, SIGN, DATE AND RETURN THE ENCLOSED PROXY AT YOUR EARLIEST
CONVENIENCE.
By order of the Board of Directors:
/s/George Vradenburg, III
George Vradenburg, III
Secretary
Dulles, Virginia
January 22, 1998
Preliminary Copy
AMERICA ONLINE, INC.
THIS PROXY IS BEING SOLICITED BY AMERICA ONLINE, INC.'S
BOARD OF DIRECTORS
The undersigned, revoking previous proxies relating to these shares,
hereby acknowledges receipt of the Notice and Proxy Statement dated January
22, 1998 in connection with the Special Meeting to be held at 4:00 p.m. on
February __, 1998 at the Sheraton Premiere at Tyson's Corner, located at
8661 Leesburg Pike, Vienna, Virginia and hereby appoints Stephen M. Case,
Lennert J. Leader, Robert W. Pittman and George Vradenburg, III and each of
them (with full power to act alone), the attorneys and proxies of the
undersigned, with power of substitution to each, to vote all shares of the
Common Stock of America Online, Inc. registered in the name provided
herein which the undersigned is entitled to vote at the 1998 Special
Meeting of Stockholders, and at any adjournment or adjournments thereof,
with all the powers the undersigned would have if personally present.
Without limiting the general authorization hereby given, said proxies are,
and each of them is, instructed to vote or act as follows on the proposals
set forth in said Proxy.
This Proxy when executed will be voted in the manner directed herein.
If no direction is made this Proxy will be voted FOR the amendment of the
Restated Certificate of Incorporation to increase the authorized number of
shares. With respect to the tabulation of proxies for purposes of the
proposal to amend the Company's Restated Certificate of Incorporation to
increase the authorized number of shares, abstentions and broker non-votes
are treated as votes against the proposal.
In their discretion the proxies are authorized to vote upon such other
matters as may properly come before the meeting or any adjournments
thereof.
SEE REVERSE SIDE FOR THE PROPOSAL. If you wish to vote in accordance
with the Board of Directors' recommendations, just sign on the reverse
side. You need not mark any boxes.
[SEE REVERSE
CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE]
[x] Please mark
votes as in
this example.
The Board of Directors recommends a vote FOR the amendment.
1. Amendment of Restated Certificate
of Incorporation to increase the
number of authorized shares.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT [ ]
Please sign exactly as name(s) appears hereon. Joint owners
should each sign. When signing as attorney, executor, admini-
strator, trustee or guardian, please give full title as such.
Signature:________________ Date______ Signature:________________Date_______
