<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
THE FINISH LINE, INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
THE FINISH LINE, INC.
--------------------------------------------------------------------------------
(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:
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<PAGE> 2
June 8, 2000
Dear Stockholder:
You are cordially invited to attend the 2000 Annual Meeting of
Stockholders of The Finish Line, Inc. on Thursday, July 20, 2000, at 9:00 a.m.,
to be held at Finish Line Corporate Office, 3308 N. Mitthoeffer Rd,
Indianapolis, IN 46235. Members of your Board of Directors and management look
forward to greeting those stockholders who are able to attend.
The accompanying Notice and Proxy Statement describe the matters to be
acted upon at the meeting.
It is important that your shares be represented and voted at the
meeting. Whether or not you plan to attend, please sign, date and mail the
enclosed proxy card at your earliest convenience. If you attend the meeting, you
may withdraw your proxy and vote in person.
Your interest and participation in the affairs of the Company are
greatly appreciated.
Respectfully,
/s/ Alan H. Cohen
-----------------
Alan H. Cohen,
Chairman of the Board
and Chief Executive Officer
<PAGE> 3
THE FINISH LINE, INC.
3308 North Mitthoeffer Road
Indianapolis, Indiana 46235
----------------------------
Notice of Annual Meeting of Stockholders
to be held July 20, 2000
----------------------------
TO THE STOCKHOLDERS OF THE FINISH LINE, INC.:
Notice is hereby given that the 2000 Annual Meeting of Stockholders of
The Finish Line, Inc. to be held at Finish Line Corporate Office, 3308 N.
Mitthoeffer Rd, Indianapolis, IN 46235 on Thursday, July 20, 2000 at 9:00 a.m.,
will be conducted for the following purposes:
1. To elect six directors; and
2. To transact such other business as may properly come before the
meeting or any adjournments thereof.
Only stockholders of record at the close of business on May 26, 2000,
will be entitled to notice of and to vote at the Annual Meeting and any
adjournments or postponements thereof.
By Order of the Board of Directors,
/s/ Gary D. Cohen
-----------------
Gary D. Cohen,
Executive Vice President - General
Counsel, Secretary
Indianapolis, Indiana
June 8, 2000
--------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT. ACCORDINGLY, YOU ARE ASKED TO COMPLETE, SIGN, DATE AND
RETURN THE ACCOMPANYING PROXY CARD IN THE ENVELOPE PROVIDED, WHICH REQUIRES NO
POSTAGE IF MAILED IN THE UNITED STATES.
--------------------------------------------------------------------------------
<PAGE> 4
THE FINISH LINE, INC.
3308 N. MITTHOEFFER ROAD
INDIANAPOLIS, INDIANA 46235
---------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
JULY 20, 2000
---------------------------
GENERAL INFORMATION
This Proxy Statement and the accompanying Notice of Annual Meeting and Proxy
Card are being mailed on or about June 8, 2000 in connection with the
solicitation of proxies by the Board of Directors of The Finish Line, Inc.
("TFL" or the "Company") for use at the 2000 Annual Meeting of Stockholders of
the Company (the "Annual Meeting") to be held at Finish Line Corporate Office,
3308 N. Mitthoeffer Rd, Indianapolis, IN 46235, on Thursday, July 20, 2000, at
9:00 a.m., and any adjournment or postponement thereof. At the Annual Meeting,
the Company's stockholders will be asked to elect six directors and to vote on
such other matters as may properly come before the Annual Meeting.
Throughout this Proxy Statement, fiscal 2000, fiscal 1999 and fiscal 1998
represent the fiscal years ended February 26, 2000, February 27, 1999, and
February 28, 1998, respectively.
PERSONS MAKING THE SOLICITATION
The Company is making this solicitation and will bear the expenses of preparing,
printing and mailing proxy materials to the Company's stockholders. In addition,
proxies may be solicited personally or by telephone or fax by officers or
employees of the Company, none of who will receive additional compensation
therefrom. The Company will also reimburse brokerage houses and other nominees
for their reasonable expenses in forwarding proxy materials to beneficial owners
of the Class A Common Stock.
VOTING AT THE MEETING
Stockholders of record at the close of business on May 26, 2000 of the Company's
Class A Common Stock, par value $.01 per share ("Class A Common Stock"), and
Class B Common Stock, par value $.01 per share ("Class B Common Stock"), are
entitled to notice of and to vote at the Annual Meeting and any adjournment or
postponement thereof. On that date, 18,212,615 shares of Class A Common Stock
and 6,267,375 shares of Class B Common Stock were outstanding and entitled to
vote. Each outstanding share of Class A Common Stock entitles the holder thereof
to one vote and each outstanding share of Class B Common Stock entitles the
holder to ten votes.
The six nominees receiving the highest number of affirmative votes of the
shares present or represented and entitled to be voted for them shall be elected
as directors. Votes withheld from any director are counted for purposes of
determining the presence or absence of a quorum for the transaction of business.
The Company believes that abstentions should be counted for purposes of
determining whether a quorum is present at the Annual Meeting for the
transaction of business. In the absence of controlling precedent to the
contrary, the Company intends to treat abstentions with respect to the election
of directors in this manner. The Company intends to count broker non-votes as
present or represented for purposes of determining the presence or absence of a
quorum for the transaction of business.
Stockholders do not have the right to cumulate their votes in the election of
directors.
1
<PAGE> 5
REVOCABILITY OF PROXY
A proxy may be revoked by a stockholder prior to the voting at the Annual
Meeting by written notice to the Secretary of the Company, by submission of
another proxy bearing a later date or by voting in person at the Annual Meeting.
Such notice or later proxy will not affect a vote on any matter taken prior to
the receipt thereof by the Company. The mere presence at the Annual Meeting of a
stockholder who has appointed a proxy will not revoke the prior appointment. If
not revoked, the proxy will be voted at the Annual Meeting in accordance with
the instructions indicated on the Proxy Card by the stockholders or, if no
instructions are indicated, will be voted FOR the slate of directors described
herein and as to any other matter that may be properly brought before the Annual
Meeting, in accordance with the judgment of the proxy.
2
<PAGE> 6
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of May 26, 2000, information relating to the
beneficial ownership of the Company's common stock by each person known to the
Company to be the beneficial owner of more than five percent of the outstanding
shares of Class A Common Stock or Class B Common Stock, by each director or
nominee for director, by each of the executive officers named below, and by all
directors and executive officers as a group.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP AS OF MAY 26, 2000
-------------------------------------------------------------------------
CLASS A CLASS B
---------------------------- -------------------------
NUMBER OF % OF NUMBER OF % OF TOTAL
NAME SHARES (1)(2) CLASS (3) SHARES (1) CLASS(3) SHARES
---- -------------- --------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C>
Alan H. Cohen .................. 151,250(4) (12) 2,331,898(7) 37.2% 2,483,148
David I. Klapper .................. 156,250(5) (12) 2,343,698(8) 37.4% 2,499,948
Larry J. Sablosky .................. 60,000(6) (12) 1,591,779(9) 25.4% 1,651,779
Joseph W. Wood .................. 72,650(10) (12) -- -- 72,650
Steven J. Schneider .................. 49,320(10) (12) -- -- 49,320
Donald E. Courtney .................. 55,250(10) (12) -- -- 55,250
George S. Sanders .................. 41,250(10) (12) -- -- 41,250
Michael L. Marchetti.................. 20,650(10) (12) -- -- 20,650
Gary D. Cohen .................. 22,412(10) (12) -- -- 22,412
Thomas R. Sicari .................. 9,750(10) (12) -- -- 9,750
Kevin S. Wampler .................. 16,650(10) (12) -- -- 16,650
Kevin G. Flynn .................. 9,670(10) (12) -- -- 9,670
Robert A. Edwards .................. 23,550(10) (12) -- -- 23,550
James B. Davis .................. 9,450(10) (12) -- -- 9,450
Joseph L. Gravitt .................. 19,650(10) (12) -- -- 19,650
Jonathan K. Layne .................. 12,000(10) (12) -- -- 12,000
Jeffrey H. Smulyan .................. 56,000(10) (12) -- -- 56,000
Stephen Goldsmith .................. 7,000(10) (12) -- -- 7,000
FMR Corp .................. 2,049,700(11) 11.0% -- -- 2,049,700
82 Devonshire Street
Boston, MA 02109
Dimensional Fund Advisors............. 1,036,200(11) 5.7% -- -- 1,036,200
1299 Ocean Ave., 11th Floor
Santa Monica, CA 90401
High Rock Asset Management LLC........ 954,800(11) 5.2% -- -- 954,800
28 State Street, 18th Floor
Boston, MA 02109
All directors and executive officers as
a group (18 persons) ................ 792,752 4.2% 6,267,375 100.0% 7,060,127
</TABLE>
--------------
(1) Each executive officer and director has sole voting and investment power
with respect to the shares listed, unless otherwise indicated, and the
address for the executive officers and directors is: 3308 N. Mitthoeffer
Road, Indianapolis, Indiana 46235.
(2) If shares of Class B Common Stock are owned by the named person or group,
excludes shares of Class B Common Stock convertible into a corresponding
number of Class A Common Stock.
(3) The shares owned by each person, or by the group, and the shares included
in the total number of shares outstanding have been adjusted, and the
percentage owned (where such percentage exceeds 1%) has been computed, in
accordance with Rule 13d-3(d)(1) under the Securities Exchange Act of
1934.
(4) Includes 40,000 shares gifted to a private family foundation, which is
controlled by the named person, and includes 111,250 shares held by a
family partnership in which Mr. Cohen serves as a general partner.
3
<PAGE> 7
(5) Includes 45,000 shares gifted to a private family foundation, which is
controlled by the named person, and includes 111,250 shares held by a
family partnership in which Mr. Klapper serves as the general partner.
(6) Represents shares gifted to a private family foundation, which is
controlled by the named person.
(7) Includes 670,307 shares of Class B Common Stock held as trustee of various
trusts for the benefit of his minor children and 150,000 shares of Class B
Common Stock held by a family partnership in which Mr. Cohen serves as
general partner.
(8) Includes 697,539 shares of Class B Common Stock held as trustee of various
trusts for the benefit of his minor children and 359,526 shares of Class B
Common Stock held by a family partnership in which Mr. Klapper serves as
general partner.
(9) Includes (i) 124,019 shares of Class B Common Stock held as trustee of a
trust for the benefit of his minor children, (ii) 551,546 shares of Class
B Common Stock held by a family partnership in which Mr. Sablosky serves
as general partner, (iii) 7,210 shares of Class B Common Stock held by Mr.
Sablosky's spouse and (iv) 11,632 shares held by Mr. Sablosky as custodian
for his minor children.
(10) Includes the following shares issuable upon exercise of options which are
exercisable within 60 days of May 26, 2000:
Joseph W. Wood ............................... 62,650
Steven J. Schneider ............................... 38,650
Donald E. Courtney ............................... 53,650
George S. Sanders ............................... 41,250
Michael L. Marchetti............................... 18,650
Gary D. Cohen ............................... 14,912
Thomas R. Sicari ............................... 9,750
Kevin S. Wampler ............................... 16,650
Kevin G. Flynn ............................... 9,470
Robert A. Edwards ............................... 22,350
James B. Davis ............................... 9,450
Joseph L. Gravitt ............................... 16,450
Jonathan K. Layne ............................... 12,000
Jeffrey H. Smulyan ............................... 30,000
Stephen Goldsmith ............................... 7,000
(11) This information is based solely on Schedule 13G's filed with the
Securities Exchange Commission, copies of which were provided to the
Company. The respective dates of the Schedule 13G's are as follows:
FMR Corp........................................... 02/14/00
Dimensional Fund Advisors.......................... 02/04/00
High Rock Asset Management......................... 02/14/00
(12) Less than 1% of the shares of Class A Common Stock outstanding.
4
<PAGE> 8
ELECTION OF DIRECTORS
A board of six directors is to be elected at the 2000 Annual Meeting. The
persons named in the Proxy Card as proxies for this meeting will vote in favor
of each of the following nominees as directors of the Company unless otherwise
indicated by the stockholder on the Proxy Card. Directors elected at the 2000
Annual Meeting will hold office until the next annual meeting of stockholders of
the Company, and until their successors are duly elected and qualified, except
in the event of their death, resignation, or removal. Management has no reason
to believe that any of the nominees will be unable or unwilling to serve if
elected. If any nominee should become unavailable prior to the election, the
accompanying Proxy Card will be voted for the election in his or her stead of
such other person as the Board of Directors may recommend.
NOMINEES
The nominees for election as directors of the Company are Alan H. Cohen, David
I. Klapper, Larry J. Sablosky, Jonathan K. Layne, Jeffrey H. Smulyan and Stephen
Goldsmith. Each of such persons, currently serves as a director of the Company.
See "Management--Executive Officers and Directors" for additional information
concerning the nominees.
BOARD OF DIRECTORS' RECOMMENDATION
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE
SLATE OF NOMINEES SET FORTH ABOVE. PROXIES SOLICITED BY THE BOARD OF DIRECTORS
WILL BE SO VOTED UNLESS STOCKHOLDERS SPECIFY OTHERWISE ON THEIR PROXY CARDS.
5
<PAGE> 9
MANAGEMENT
EXECUTIVE OFFICERS AND DIRECTORS
The executive officers, directors and nominees for director of the Company are
as follows:
<TABLE>
<CAPTION>
EXECUTIVE
OFFICER OR
DIRECTOR
NAME AGE POSITION SINCE
---- --- -------- ----------
<S> <C> <C> <C>
Alan H. Cohen ......... 53 Chairman of the Board, President and CEO 1976
David I. Klapper ......... 51 Senior Executive Vice President, Director 1976
Larry J. Sablosky ......... 51 Senior Executive Vice President, Director 1982
Joseph W. Wood ......... 53 Executive Vice President-Merchandise and Marketing 1995
Steven J. Schneider ......... 44 Executive Vice President-Finance, CFO and Asst. Secretary 1989
Donald E. Courtney ......... 45 Executive Vice President-MIS and Distribution 1989
George S. Sanders ......... 42 Executive Vice President-Real Estate and Store Development 1994
Gary D. Cohen ......... 48 Executive Vice President-General Counsel, Secretary 1997
Michael L. Marchetti......... 49 Executive Vice President-Store Operations 1995
Thomas R. Sicari ......... 46 Senior Vice President-General Merchandise Manager 1997
Kevin S. Wampler ......... 37 Senior Vice President-Corporate Controller and Asst. Secretary 1997
Kevin G. Flynn ......... 36 Senior Vice President-Marketing 1997
Robert A. Edwards ......... 37 Senior Vice President-Distribution 1997
James B. Davis ......... 37 Senior Vice President-Real Estate 1997
Joseph L. Gravitt ......... 40 Senior Vice President-Store Personnel 1998
Jonathan K. Layne ......... 46 Director 1992
Jeffrey H. Smulyan ......... 53 Director 1992
Stephen Goldsmith ......... 53 Director 1999
</TABLE>
Mr. Alan H. Cohen, a co-founder of the Company, has served as President and
Chief Executive Officer and a director of the Company since May 1982. Since
1976, Mr. Cohen has been involved in the athletic retail business as principal
co-founder of Athletic Enterprises, Inc. (one of the predecessor companies of
the Company). Mr. Cohen is an attorney, and practiced law from 1973 through
1981. Mr. Cohen is the brother of Gary D. Cohen.
Mr. David I. Klapper, a co-founder of the Company, has served as a director of
the Company since May 1982. Mr. Klapper has also served as Senior Executive Vice
President of the Company since April 2000. Prior to his current position, Mr.
Klapper served as Executive Vice President from May 1982 to April 2000. Since
1976, Mr. Klapper has been involved in the athletic retail business as principal
co-founder of Athletic Enterprises, Inc. (one of the predecessor companies of
the Company).
Mr. Larry J. Sablosky, a co-founder of the Company, has served as a director of
the Company since May 1982. Mr. Sablosky has also served as Senior Executive
Vice President of the Company since April 2000. Prior to his current positions,
Mr. Sablosky served as Executive Vice President from May 1982 to April 2000.
Prior to 1982, Mr. Sablosky was employed in a family retail business for over 10
years. Mr. Sablosky has been involved in the retail industry for over 25 years.
Mr. Joseph W. Wood, has served as Executive Vice President-Merchandise and
Marketing since April 2000. Mr. Wood also served as Senior Vice
President-Merchandise and Marketing of the Company from March 1997 to April 2000
and as Vice President and General Merchandise Manager of the Company from
January 1995 to March 1997. From May 1993 to December 1994, Mr. Wood served as
Executive Vice President and Chief Operating Officer of Just For Feet, an
athletic footwear retailer. From October 1986 to May 1993, Mr. Wood served as
Senior Vice President and General Merchandise Manager of the Athlete's Foot
Group, a mall based athletic footwear retailer.
Mr. Steven J. Schneider, has served as Executive Vice President-Finance, Chief
Financial Officer and Assistant Secretary since April 2000. Mr. Schneider also
served as Senior Vice President-Finance, Chief Financial Officer and Assistant
Secretary of the Company from March 1997 to April 2000 and as Vice
President-Finance and Chief Financial Officer of the Company since April 1989.
From August 1984 to March 1989, Mr. Schneider was employed as Assistant
Controller for Paul Harris Stores, Inc. a women's apparel retailer. Mr.
Schneider, a
6
<PAGE> 10
Certified Public Accountant, was employed by a national accounting firm for two
years and has been engaged in various financial positions in the retail industry
for over 20 years.
Mr. Donald E. Courtney, has served as Executive Vice President-MIS and
Distribution since April 2000. Mr. Courtney also served as Senior Vice
President-MIS and Distribution of the Company from March 1997 to April 2000 and
as Vice President-MIS and Distribution of the Company since August 1989. From
August 1988 to August 1989, Mr. Courtney served as Director of MIS and
Distribution for the Company. From August 1976 to August 1988, Mr. Courtney was
employed by Guarantee Auto Stores, Inc., an automotive retailer. At the time Mr.
Courtney left Guarantee Auto Stores, he held the position of Vice President-MIS
and Distribution. Mr. Courtney has been involved in the retail industry for over
20 years.
Mr. George S. Sanders, has served as Executive Vice President-Real Estate and
Store Development since April 2000. Mr. Sanders also served as Senior Vice
President-Real Estate and Store Development of the Company from March 1997 to
April 2000 and as Vice President-Real Estate and Store Construction since April
1994. From February 1993 to April 1994, Mr. Sanders served as Director of Real
Estate of the Company. From 1983 to February 1993, Mr. Sanders was employed by
Melvin Simon and Associates, a real estate developer and manager. At the time
Mr. Sanders left Melvin Simon and Associates, he held the position of Sr.
Leasing Representative.
Mr. Michael L. Marchetti, has served as Executive Vice President-Store
Operations since April 2000. Mr. Marchetti also served as Senior Vice
President-Store Operations of the Company from March 1997 to April 2000 and as
Vice President-Store Operations since September 1995. From May 1990 to September
1995, Mr. Marchetti was employed by Champs Sports, a division of Venator
Corporation, and the last five years of which he served as Regional Vice
President. Mr. Marchetti has been involved in the retail industry for over 25
years.
Mr. Gary D. Cohen, has served as Executive Vice President-General Counsel and
Secretary since April 2000. Mr. Cohen also served as Senior Vice
President-General Counsel and Secretary of the Company from his employment in
July 1997 to April 2000. Mr. Cohen also has served as Secretary for the Company
since July 1998. From April 1990 to July 1997, Mr. Cohen was a Senior Partner in
the law firm of Cohen and Morelock. During the 15 years preceding his joining
the Company, Mr. Cohen represented the Company regarding real estate matters.
From 1978 to 1990 Mr. Cohen held associate partnership positions with various
law firms. At the present time, Mr. Cohen retains an "Of Counsel" position with
Cohen and Morelock. Mr. Cohen is the brother of Alan H. Cohen.
Mr. Thomas R. Sicari, has served as Senior Vice President-General Merchandise
Manager since April 2000. Mr. Sicari also served as Vice President-General
Merchandise Manager of the Company from March 1997 to April 2000. He has been
employed by the Company since April 1995 and prior to being an officer served as
General Merchandise Manager. Previously Mr. Sicari was employed as a buyer by
The Sports Authority an "athletic superstore" retailer from March 1994 to March
1995. Mr. Sicari was employed from March 1991 to March 1994 as a footwear buyer
for Champs Sports (a division of Kinney Corp.) a specialty athletic mall based
retailer.
Mr. Kevin S. Wampler, has served as Senior Vice President-Corporate Controller
and Assistant Secretary since April 2000. Mr. Wampler also served as Vice
President-Corporate Controller and Assistant Secretary of the Company from March
1997 to April 2000. Mr. Wampler is a CPA and has been employed by the Company
since June 1993 as Corporate Controller. Mr. Wampler was previously employed by
a national accounting firm from July 1986 to May 1993. At the time Mr. Wampler
left the national accounting firm, he held the position of Audit Manager.
Mr. Kevin G. Flynn, has served as Senior Vice President-Marketing since April
2000. Mr. Flynn also served as Vice President-Marketing of the Company from
March 1997 to April 2000. Mr. Flynn has been employed by the Company since
November 1994 and prior to election as an officer, held the position of
Marketing Director. Mr. Flynn was previously employed from July 1992 to November
1994 as Associate Media Director for Caldwell Van Riper, a regional advertising
agency.
Mr. Robert A. Edwards, has served as Senior Vice President-Distribution since
April 2000. Mr. Edwards also served as Vice President-Distribution of the
Company from March 1997 to April 2000. Mr. Edwards has been employed by the
Company since June 1983 and prior to his election as an officer, held the
position of Director of Distribution.
7
<PAGE> 11
Mr. James B. Davis, has served as Senior Vice President-Real Estate since April
2000. Mr. Davis also served as Vice President-Real Estate of the Company from
October 1997 to April 2000. Mr. Davis has been employed by the Company since
October 1996 and prior to his election as an officer, held the position of
Director of Leasing. Mr. Davis was previously employed as Vice President-Leasing
for JMB Urban, (a real estate developer and manager) from January 1993 to
October 1996.
Joseph L. Gravitt, has served as Senior Vice President-Store Personnel since
April 2000. Mr. Gravitt also served as Vice President-Store Personnel of the
Company from July 1998 to April 2000. Mr. Gravitt has been employed by the
Company since December 1982. Prior to his election as an officer, Mr. Gravitt
held the position of Director of Store Operations for the Company.
Mr. Jonathan K. Layne, has served as a director of the Company since June 1992.
Mr. Layne has been a partner of the law firm of Gibson, Dunn & Crutcher LLP
since 1987, where he specializes in corporate and securities law matters. Mr.
Layne was an associate with Gibson, Dunn & Crutcher LLP from 1979 to 1986. Mr.
Layne is also a member of the Board of Directors of K-Swiss Inc., a manufacturer
of athletic footwear.
Mr. Jeffrey H. Smulyan, has served as a director of the Company since June 1992.
Mr. Smulyan is CEO, Chairman of the Board, and President of EMMIS Communications
Corporation, which he founded in 1981. EMMIS owns and operates radio stations,
television stations, and regional and specialty magazines around the country. He
is the former owner of the Seattle Mariners baseball team.
Mr. Stephen Goldsmith, has served as a director of the Company since July 1999.
Mr. Goldsmith is a partner with the law firm of Baker & Daniels in Indianapolis
since January 2000. Mr. Goldsmith served as Mayor of the City of Indianapolis,
Indiana from January 1992 until December 1999. Mr. Goldsmith has previous
leadership and academic experience which include Chairman, Center for Civic
Innovation, Manhattan Institute; Honorary Co-Chairman, National Council for
Public-Private Partnerships; Research Fellow in Criminal Justice and Management,
Harvard University's Kennedy School of Government; and Assistant and Adjunct
Professor, Indiana University's School of Public and Environmental Affairs. Mr.
Goldsmith is also a member of the Board of Directors of Consolidated Products
Inc., an owner, operator and franchiser of Steak n Shake restaurants.
Each director holds office until the next annual meeting of stockholders or
until his successor has been elected and qualified. Officers are appointed by
and serve at the discretion of the Board of Directors. Unless otherwise stated,
there are no family relationships among any directors or executive officers of
the Company.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held 5 meetings in fiscal 2000 and all directors attended
at least 75 percent of the meetings of the Board and Board Committees of which
they were members.
The Board of Directors has 3 committees. The Audit Committee is comprised of
Messrs. Cohen, Goldsmith and Smulyan. The Compensation and Stock Option
Committee is comprised of Messrs. Smulyan and Layne. The Finance Committee is
comprised of Messrs. Klapper and Layne. There is no committee performing the
function of a Nominating Committee.
The Audit Committee met 2 times during fiscal 2000. The Audit Committee
represents the Board of Directors in discharging its responsibilities relating
to the accounting, reporting, and financial practices of the Company and its
subsidiaries, and has the general responsibility for surveillance of internal
controls and accounting and audit activities if the Company and its
subsidiaries.
More specifically, the Audit Committee (i) recommends to the Board of Directors,
and evaluates, the firm of independent certified public accountants to be
appointed as auditor of the Company; (ii) reviews with the independent auditor
their audit procedures and the results of the annual audit examination; (iii)
assesses the independence of the auditor; (iv) reviews and discusses with
management and the independent auditor the Company's annual audited financial
statements; (v) reviews with management and the independent auditor the results
of any significant matters identified as a result of the independent auditor's
interim review procedures prior
8
<PAGE> 12
to the filing of each form 10-Q or as soon thereafter as possible; (vi) reviews
the adequacy of the Company's internal controls; (vii) reviews significant
changes in the accounting policies of the Company and accounting and financial
reporting rule changes; (viii) reviews material pending legal proceedings
involving the Company and other contingent liabilities; and (ix) reviews the
adequacy of the Audit Committee Charter on an annual basis, and recommends
changes if the Committee determines changes are appropriate.
The Compensation and Stock Option Committee met one time during fiscal 2000. The
Compensation and Stock Option Committee focuses on executive compensation, the
administration of the Company's stock option and stock purchase plans and making
decisions on the granting of discretionary bonuses.
The Finance Committee met one time during fiscal 2000. The Finance Committee
focuses on overseeing the management by the officers of the Company's
investments and working capital.
EXECUTIVE COMPENSATION
The following Summary Compensation Table shows compensation paid by the Company
for services rendered during fiscal years 2000, 1999 and 1998 for the person who
was Chief Executive Officer at the end of the last fiscal year and the five most
highly compensated executive officers of the Company ("Named Officers") whose
salary and bonus exceeded $100,000 in fiscal 2000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-------------------------------------
AWARDS PAYOUTS
-------------------------- -------
ANNUAL COMPENSATION RESTRICTED SECURITIES
------------------- STOCK UNDERLYING LTIP ALL OTHER
SALARY BONUS AWARD (S) OPTIONS/SAR'S PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($)(1) $ (#) ($) ($)(2)
--------------------------- ---- ------- ------- ---------- ------------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Alan H. Cohen ........... 2000 265,000 15,900 -- -- -- 17,537
CEO, President and 1999 265,000 15,900 -- -- -- --
Chairman of the Board 1998 265,000 136,184 -- -- -- --
Joseph W. Wood (4)...... 2000 231,000 9,240 -- 18,000 -- 17,537
Sr. Vice President- 1999 220,000 8,800 -- 10,000 -- 18,345
Merchandise and Marketing 1998 202,400 69,342 -- 17,000 -- 18,542
Steven J. Schneider (4)...... 2000 220,000 8,800 -- 18,000 -- 17,537
Sr. Vice President of Finance, 1999 200,000 8,000 -- 10,000 -- 18,345
Chief Financial Officer 1998 177,000 60,640 -- 17,000 -- 18,542
and Assistant Secretary
Gary D. Cohen (4)...... 2000 211,750 8,470 -- 18,000 -- 17,537
Sr. Vice President, 1999 192,500 15,200(3) -- 10,000 -- 18,345
General Counsel & Secretary 1998 116,667 53,470(3) -- 26,375 -- --
George S. Sanders (4)...... 2000 202,000 8,080 -- 18,000 -- 17,537
Sr. Vice President, 1999 175,000 7,000 -- 10,000 -- 18,345
Real Estate and 1998 150,000 51,390 -- 17,000 -- 18,542
Store Development
</TABLE>
(1) Cash bonuses for services rendered in each fiscal year have been listed in
the year earned; however the amounts listed were actually paid in the
subsequent fiscal year, except as noted in Note (3) below.
(2) The stated amounts are Company contributions to The Finish Line, Inc.
Profit Sharing Plan.
(3) Includes $7,500 in fiscal 1999 and $13,500 in fiscal 1998 paid as part of
signing bonus package.
(4) Title listed as end of fiscal year. Named officer was promoted to
Executive Vice President effective April 27, 2000.
9
<PAGE> 13
DIRECTOR COMPENSATION
Directors who are employees of the Company are not compensated for serving as
directors. Directors who are not employees of the Company are paid $2,500 per
annum and an additional $2,500 per meeting for attending regular meetings of the
Board of Directors and are reimbursed for expenses incurred in attending
regular, special and committee meetings. In addition, Directors who are not
employees of the Company receive options to purchase 3,000 shares of Class A
Common Stock upon their first election to the Board and an additional 4,000
options for each year they serve on the Board.
OPTION GRANTS IN LAST FISCAL YEAR
The following table contains information with respect to options to purchase the
Company's Class A Common Stock granted during fiscal 2000 to the Named Officers.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
--------------------------------------------------------- POTENTIAL REALIZABLE
NUMBER OF VALUE AT ASSUMED
SECURITIES % OF TOTAL ANNUAL RATES
UNDERLYING OPTIONS OF STOCK PRICE
OPTIONS GRANTED EXERCISE APPRECIATION FOR
GRANTED TO EMPLOYEES PRICE EXPIRATION OPTION TERM (4)
NAME #(1)(2) IN FISCAL YEAR ($/SH)(3) DATE 5% 10%
------------------------- ----------- -------------- ---------- ---------- ------------------------
<S> <C> <C> <C> <C> <C> <C>
Alan H. Cohen.......... -- -- -- -- -- --
Joseph W. Wood........ 18,000 4.2% 5.3125 1/20/2010 $60,138 $152,402
Steven J. Schneider..... 18,000 4.2% 5.3125 1/20/2010 $60,138 $152,402
Gary D. Cohen.......... 18,000 4.2% 5.3125 1/20/2010 $60,138 $152,402
George S. Sanders...... 18,000 4.2% 5.3125 1/20/2010 $60,138 $152,402
</TABLE>
(1) Options granted during fiscal 2000 vest 10% after one year, an additional
20% after two years, an additional 30% after three years and the remaining
40% after four years after the date of grant.
(2) Options were granted for a term of 10 years, subject to earlier
termination in certain events related to termination of employment.
(3) Options were granted at market value at the date of grant.
(4) Potential realizable value is based on the assumption that the common
stock price appreciates at the annual rate shown (compounded annually)
from the grant date until the end of the ten year option term. This value
is calculated based on requirements of the Securities and Exchange
Commission and does not reflect the Company's estimate of future stock
price growth.
10
<PAGE> 14
OPTION/SAR EXERCISES AND YEAR-END VALUE TABLE
Shown below is information with respect to the exercise in 2000 of options to
purchase the Company's Class A Common Stock by the five Named Officers and the
unexercised options to purchase the Company's Class A Common Stock under the
Incentive Plan (as defined herein).
<TABLE>
<CAPTION>
Number of
Securities
Underlying
Unexercised In-the-Money
Shares Options/SARs Options/ SARs
Acquired at FY-End (#) at FY-End ($)(1)
on Value ------------------- -------------------
Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
------------------------- ---------- ---------- ------------------- -------------------
<S> <C> <C> <C> <C> <C> <C>
Alan H. Cohen ...... -- -- -- -- -- --
Joseph W. Wood ...... -- -- 58,525 38,475 52,000 18,000
Steven J. Schneider...... -- -- 36,525 38,475 30,000 18,000
Gary D. Cohen ...... -- -- 14,912 39,463 -- 18,000
George S. Sanders ...... -- -- 39,125 38,475 24,600 18,000
</TABLE>
(1) Represents the difference between the closing price of the Company's Class
A Common Stock on the Nasdaq Stock Market(R) on February 26, 2000 ($5.875)
and the exercise price of the options.
11
<PAGE> 15
COMPENSATION AND STOCK OPTION COMMITTEE REPORT
SCOPE OF COMMITTEE'S WORK
The Compensation and Stock Option Committee of the Board of Directors (the
"Committee") administers the Company's 1992 Employee Stock Incentive Plan, as
amended, reviews the Company's compensation plans, programs and policies for
executive officers, monitors the performance and compensation of executive
officers and other key employees and makes appropriate recommendations and
reports to the full Board of Directors concerning matters of executive
compensation.
SUMMARY OF COMPENSATION POLICIES FOR CEO AND EXECUTIVE OFFICERS
The Company's philosophy is to maintain compensation programs which attract,
retain and motivate senior management with economic incentives which are
directly linked to financial performance and increased stockholder value. The
key elements of the Company's executive compensation program consist of a base
salary, potential for an annual bonus directly linked to overall Company
performance and the grant of stock options and other stock incentive awards
intended to encourage achievement of superior results over time and to directly
align executive officer and stockholder economic interests.
CEO COMPENSATION
The Committee believes the Chief Executive Officer's compensation should be
heavily influenced by Company performance. The Committee also considers the
level of compensation paid to the chief executive officers of comparable
companies as part of its calculation of the compensation to be paid to the
Company's Chief Executive Officer. For the last three fiscal years, Mr. Alan H.
Cohen, the Company's Chief Executive Officer, was compensated at an annualized
rate of $265,000. See "Executive Compensation-Summary Compensation Table". In
March 1999, the Committee established a performance bonus program for Mr. Cohen
(as well as for the Company's other senior executive officers), which, for the
fiscal year ended February 26, 2000, was based on four factors:
1. Increase in 2000 operating income before taxes as compared to 1999 operating
income before taxes
2. Same store sales increases
3. Total sales increases
4. Total square footage added from retail stores
A bonus of between 0% and 60% of base compensation, up to a maximum of $159,000
was payable to Mr. Cohen under the program. The Committee believes this
arrangement provided the Chief Executive Officer (as well as the Company's other
senior executive officers) with significant incentive and aligned what amounted
to a bonus ($15,900 for fiscal 2000) equal to a representative percentage (6%
for fiscal 2000) of his annual base salary directly to the Company's economic
performance.
While the Committee believes that the use of stock options which vest over a
period of time are an effective device to link individual compensation with
increased stockholder values, because of Mr. Cohen's substantial equity position
in the Company (an aggregate of 2,483,148 shares of Class A and Class B Common
Stock as of May 26, 2000), Mr. Cohen requested that he not be eligible at the
current time for the grant of stock options or other incentive awards under the
Company's Incentive Plan. Mr. Cohen, Mr. David I. Klapper and Mr. Larry J.
Sablosky (collectively "founders") are principal shareholders of the Company and
each has currently elected not to receive grants of stock options or stock
grants. Consequently, no options or incentive awards were granted to the
founders during fiscal 2000.
12
<PAGE> 16
EXECUTIVE OFFICERS COMPENSATION
The Committee has adopted similar policies with respect to overall compensation
of the Company's other senior executive officers.
The Company's Senior Vice President - Merchandise and Marketing, Mr. Wood, was
compensated at an annual base salary of $231,000 during fiscal 2000. The
Company's Senior Vice President - Finance, Chief Financial Officer and Assistant
Secretary, Mr. Schneider, was compensated at an annual base salary of $220,000
during fiscal 2000. The Company's Senior Vice President-General Counsel and
Secretary, Mr. Gary Cohen was compensated at an annual base salary of $211,750
during fiscal 2000. The Company's Senior Vice President-Real Estate & Store
Development, Mr. Sanders was compensated at an annual base salary of $202,000
during fiscal 2000. In addition, Messrs. Wood, Schneider, Sanders and Cohen
participated in a bonus plan similar to the plan described above, subject to a
maximum bonus of 40% of annual base salary.
The Company's Chief Executive Officer and the other Named Officers were also
eligible to participate in the Company's Profit Sharing Plan currently up to a
maximum annual contribution of $30,000 per person for the Company's most recent
plan year ended October 31, 1999. See "Executive Compensation - Summary
Compensation Table".
Under current law, income tax deductions for compensation paid by
publicly-traded companies may be limited to the extent total compensation
(including base salary, annual bonus, restricted stock awards, stock options
exercises, and non-qualified benefits) for certain executive officers exceeds $1
million in any one year. Under the law, the deduction limit does not apply to
payments which qualify as "performance based." To qualify as "performance
based", compensation payments must be made from a plan that is administered by a
compensation committee of the Board of Directors which is comprised solely of
two or more outside directors. In addition, the material terms of the plan must
be disclosed to and approved by stockholders, and the Committee must certify
that the performance goals were achieved before payments can be awarded.
To the extent readily determinable, and as one of the factors in its
consideration of compensation matters, the Committee also considers the
anticipated tax treatment to the Company and to the executives of various
payments and benefits. However, since some types of compensation payments and
their deductibility depend upon the timing of an executive's exercise of stock
options rights (e.g., the spread on exercise of non-qualified options), and
because interpretations and changes in the tax laws and other factors beyond the
Committee's control may also affect the deductibility of compensation, the
Committee will not necessarily limit executive compensation to that which is
deductible under applicable provisions of the Internal Revenue Code. The
Committee will consider various alternatives to preserving the deductibility of
compensation payments and benefits to the extent reasonably practicable and to
the extent consistent with its other compensation objectives.
13
<PAGE> 17
SUMMARY
The Committee believes that the current compensation arrangements provide the
Chief Executive Officer and the other executive officers with incentive to
perform at superior levels and in a manner which is directly aligned with the
economic interests of the Company's stockholders.
COMPENSATION AND STOCK
OPTION COMMITTEE
Jonathan K. Layne
Jeffrey H. Smulyan
May 26, 2000
The above report of the Compensation and Stock Option Committee will not be
deemed to be incorporated by reference into any filing by the Company under the
Securities Act of 1933 or the Securities Exchange Act of 1934, except to the
extent that the Company specifically incorporates the same by reference.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Smulyan and Layne comprise the Compensation and Stock Option Committee.
Mr. Smulyan is Chairman of the Board, President and principal shareholder of
Emmis Communication Corporation, a publicly held company. During fiscal 2000,
the Company purchased from Emmis Publishing Company, a wholly owned subsidiary
of Emmis Communications Corporation, approximately $1,648,000 of publishing
services related to the Company's quarterly marketing magazine, `Spike'.
Mr. Layne is a partner of the law firm of Gibson, Dunn & Crutcher LLP, which has
provided legal services to the Company. The Company expects that such law firm
will continue to render legal services to the Company in the future.
14
<PAGE> 18
STOCK PRICE PERFORMANCE GRAPH
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG THE FINISH LINE, INC.
S&P 500 INDEX AND PEER GROUP INDEX (1)
The Stock Price Performance Graph below shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent the Company specifically
incorporates this information by reference, and shall not otherwise be deemed
filed under such Acts.
Date Company Index Market Index Peer Index
02/28/1995 100.000 100.000 100.000
03/24/1995 107.843 103.168 105.931
04/26/1995 116.667 105.279 95.769
05/26/1995 127.451 109.906 87.230
06/26/1995 141.176 116.986 89.773
07/26/1995 188.235 126.104 93.779
08/25/1995 135.294 128.934 86.283
09/26/1995 133.333 131.251 91.475
10/26/1995 137.255 128.853 75.124
11/24/1995 129.412 130.515 85.474
12/26/1995 119.608 133.258 75.803
01/26/1996 107.843 131.898 65.000
02/26/1996 133.333 141.067 62.338
03/26/1996 223.529 138.000 68.802
04/26/1996 331.373 150.893 81.603
05/24/1996 386.275 158.935 87.483
06/26/1996 441.177 147.051 77.524
07/26/1996 329.412 137.651 70.255
08/26/1996 447.059 145.235 71.449
09/26/1996 698.039 156.784 72.642
10/25/1996 658.824 155.011 69.259
11/26/1996 582.353 162.995 59.671
12/26/1996 698.039 165.004 62.084
01/24/1997 674.510 173.724 56.234
02/26/1997 666.667 170.413 58.010
03/26/1997 776.471 161.354 64.772
04/25/1997 360.784 153.697 62.344
05/23/1997 388.235 176.871 65.199
06/26/1997 478.432 183.008 69.128
07/25/1997 439.216 200.000 68.545
08/26/1997 443.137 203.315 74.566
09/26/1997 592.157 214.602 86.084
10/24/1997 576.471 211.024 87.958
11/26/1997 584.314 204.062 85.808
12/26/1997 403.922 193.808 80.320
01/26/1998 384.314 200.176 81.770
02/26/1998 505.883 228.155 94.288
03/26/1998 639.216 234.609 104.441
04/24/1998 752.942 239.552 103.371
05/26/1998 737.255 227.224 95.674
06/26/1998 878.432 238.768 97.137
07/24/1998 635.295 246.622 95.398
08/26/1998 303.922 226.652 72.809
09/25/1998 301.961 224.663 64.295
10/26/1998 337.255 222.424 58.614
11/25/1998 272.549 255.988 68.081
12/24/1998 225.490 280.130 65.502
01/26/1999 309.804 315.693 68.055
02/26/1999 378.432 296.025 61.788
03/26/1999 423.530 312.899 63.452
04/26/1999 462.746 342.829 63.358
05/26/1999 396.079 313.661 52.812
06/25/1999 345.098 330.311 42.518
07/26/1999 339.216 339.628 42.854
08/26/1999 286.275 361.158 37.787
09/24/1999 245.098 356.279 38.798
10/26/1999 221.569 364.381 41.272
11/26/1999 211.765 446.323 44.105
12/23/1999 158.824 513.378 30.953
01/26/2000 174.510 523.498 31.837
02/25/2000 184.314 588.564 27.798
ASSUMES $100 INVESTED ON MARCH 1, 1995
AND ASSUMES DIVIDENDS REINVESTED THROUGH
FISCAL YEAR ENDING FEBRUARY 26, 2000
----------
1) Peer group is: Standard Industrial Classification Codes 5940 through 5949
(actively trading issues during relevant period). SIC codes beginning with
594 represent miscellaneous Shopping Goods Stores which, in management's
opinion, most closely represents the peer group of the Company.
15
<PAGE> 19
EMPLOYEE INCENTIVE STOCK OPTION PLAN
General
On March 27, 1992, the Board of Directors adopted the 1992 Employee Stock
Incentive Plan (the "Incentive Plan"), the purpose of which is to enable the
Company to attract, retain and motivate its employees by providing for or
increasing their proprietary interest in the Company. The Incentive Plan was
amended by the Board of Directors on April 20, 1995 and by the Company's
stockholders on July 20, 1995 to increase the maximum number of shares of Class
A Common Stock issuable from 1,000,000 to 1,700,000. On April 30, 1999, the
Board of Directors again amended the Incentive Plan to increase the maximum
number of shares of Class A Common Stock issuable from 1,700,000 to 3,500,000
which was subsequently approved by the Company's stockholders on July 16, 1999.
Any person who is employed by the Company or any subsidiary of the Company is
eligible to participate in the Incentive Plan. As of May 26, 2000 approximately
8,500 persons were eligible.
The Incentive Plan authorizes the issuance of up to 3,500,000 shares of Class A
Common Stock, subject to adjustments under certain circumstances. As of May 26,
2000, options to purchase an aggregate of 2,374,925 shares of Class A Common
Stock at an average exercise price of $8.24 per share had been granted (net of
cancellations) under the Incentive Plan to a total of 146 persons leaving
1,102,170 options available for future grant. Included in these grants are
options to purchase an aggregate of 447,375 shares granted to four of the named
executive officers at an average exercise price of $7.15. Of these options,
143,400 have been exercised at an average price of $4.89 per share. All
unexercised options, including those granted to the executives above, total
1,731,535 shares and vest over the following years:
# Shares
--------
Currently Vested 749,642
Vesting from 5/26/2000 through FYE 2/2001 187,983
Vest During FYE 2/2002 374,890
Vest During FYE 2/2003 251,580
Vest During FYE 2/2004 167,440
The Incentive Plan provides that it shall be administered by the Compensation
and Stock Option Committee. Subject to the provisions of the Incentive Plan and
to final approval by the Board, the Compensation and Stock Option Committee has
the authority to select employees to whom awards will be granted thereunder, to
grant such awards and to determine the number of shares to be sold or issued
pursuant thereto and the terms and provisions of such awards, including, without
limitation, the terms relating to vesting, exercise price and form of payment.
The Incentive Plan authorizes the Compensation and Stock Option Committee to
award (subject to final approval by the Board) eligible employees any type of
benefits that may involve the issuance of shares of Class A Common Stock or
other benefits that are derived from the value of shares of Class A Common
Stock. Benefits are not restricted to any specified form or structure and may
include, without limitation, stock bonuses, restricted stock, stock options, and
other benefits. Any award may consist of one such arrangement or two or more of
them in tandem or in the alternative. On May 31, 2000, the last sale price of
the Company's Class A Common Stock on the Nasdaq Stock Market(R) was $7.00 per
share.
No awards may be granted under the Incentive Plan after March 27, 2002, and no
shares of Class A Common Stock may be issued under the Incentive Plan after
March 27, 2012.
The Incentive Plan may be amended or terminated by the Board of Directors at any
time; provided, however, that no such amendment or termination can deprive the
recipient of an award granted under the Incentive Plan, without the consent of
such recipient, of any of his or her rights thereunder or with respect thereto.
16
<PAGE> 20
The purpose of the Incentive Plan is to enable the Company and its subsidiaries
to attract, retain and motivate their employees by providing for or increasing
the proprietary interests of such employees in the Company. Every employee of
the Company or any of its subsidiaries is eligible to be considered for the
grant of awards under the Incentive Plan. The maximum number of shares of Class
A Common Stock that may be issued pursuant to awards granted under the Incentive
Plan is currently 3,500,000, subject to certain adjustments to prevent dilution.
The Compensation and Stock Option Committee will administer the Incentive Plan.
Subject to the provisions of the Incentive Plan and final approval of the Board,
the Compensation and Stock Option Committee will have authority to select the
participants to whom awards will be granted thereunder, to grant such awards,
and to determine the terms and conditions of such awards and the number of
shares to be issued pursuant thereto.
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
General
On July 21, 1994, the stockholders adopted and on April 29, 1999, the Board of
Directors amended, the Non-Employee Director Stock Option Plan (the "Director
Plan"), the purpose of which is to enable the Company to attract, retain and
motivate its non-employee directors by providing for or increasing their
proprietary interest in the Company. Any non-employee director of the Company or
any subsidiary of the Company is eligible to participate in the Director Plan.
As of May 26, 2000, three persons were eligible.
The Director Plan authorizes the issuance of up to 150,000 shares of Class A
Common Stock, subject to adjustments under certain circumstances. As of May 26,
2000, options to purchase an aggregate of 67,000 shares of Class A Common Stock
at an average exercise price of $10.54 per share had been granted under the
Director Plan to a total of two persons. Of these options, 18,000 have been
exercised at an average price of $6.42 per share. The unexercised options total
49,000 shares and vest over the following years:
# Shares
--------
Currently Vested 34,000
Vest During FYE 2/2001 15,000
The Director Plan is intended to be self-governing. To this end, the Director
Plan requires no discretionary action by any administrative body with regard to
any transaction under the Director Plan. To the extent, if any, that any
questions or interpretation arise, they will be resolved by the Board.
Upon initial election or appointment of any non-employee director to the Board
or upon a continuing director becoming a non-employee director, such
non-employee director will become eligible to receive an option to purchase
3,000 shares of the Company's Class A Common Stock to be granted on the date of
the next Annual Meeting of Stockholders pursuant to the terms and conditions
described in the Director Plan.
In addition, each non-employee director will be automatically granted, on a
annual basis, a non-qualified stock option to purchase 4,000 shares of the
Company's Class A Common stock on the date of each Annual Meeting of
Stockholders commencing with the Annual Meeting of Stockholders at which the
non-employee director is granted the 3,000 share option pursuant to the
foregoing paragraph. The per share exercise price of the option will be the fair
market value of a share of the Company's Class A Common
Stock on the date of grant, defined as the closing price of the Company's Class
A Common Stock on the Nasdaq Stock Market(R) (or such other securities market on
which the Company's Class A Common Stock is primarily traded on such date). Each
option will have a term of ten years and shall become fully exercisable one year
after grant. On May 31, 2000, the last sale price of the Company's Class A
Common Stock on the Nasdaq Stock Market(R) was $7.00 per share.
17
<PAGE> 21
No awards may be granted under the Director Plan after July 21, 2004, and no
shares of Class A Common Stock may be issued under the Director Plan after July
21, 2014.
The Director Plan may be amended or terminated by the Board of Directors at any
time; provided, however, that no such amendment or termination can deprive the
recipient of an award granted under the Director Plan, without the consent of
such recipient, of any of his or her rights thereunder or with respect thereto.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Ernst & Young LLP was the Company's certified public accountant for fiscal 2000.
During fiscal 2000, the Company also engaged Ernst & Young LLP to render certain
non-audit professional services involving assistance on tax planning matters and
general consultations.
The appointment of auditors is approved annually by the Board of Directors which
is based in part on the recommendation of the Audit Committee. In making its
recommendation, the Audit Committee reviewed both the audit scope and estimated
audit fees for the coming year. Ernst & Young LLP has been selected by the Audit
Committee and the Board of Directors for the current year. Stockholder approval
is not sought in connection with this selection. Each professional service
performed by Ernst & Young LLP during fiscal 2000 was reviewed, and the possible
effect of such service on the independence of the firm was considered, by the
Audit Committee. Representatives of Ernst & Young LLP plan to be present at the
Annual Meeting of Stockholders and will be given an opportunity to make a
statement if they desire to do so and will respond to questions from
stockholders.
PROPOSALS OF STOCKHOLDERS
If a stockholder wishes to submit a proposal for consideration at the 2001
Annual Stockholders Meeting and wants that proposal to appear in the Company's
proxy statement and form of proxy for that meeting, the proposal must be
submitted to the Company at its principal offices (3308 N. Mitthoeffer Road,
Indianapolis, Indiana 46235) care of the Secretary no later then February 9,
2001.
If a stockholder wishes to submit a proposal for consideration at the 2001
Annual Stockholders Meeting without including that proposal in the Company's
proxy statement and form of proxy, the Company's Bylaws require the stockholder
to provide the Company with written notice of such proposal no less then 90 days
in advance of such meeting or, if later, the seventh day following the first
public announcement of the date of such meeting. Such notice should be sent to
the Company care of the Secretary at its principal offices.
MISCELLANEOUS
The Company's Annual Report to Stockholders for the fiscal year ended February
26, 2000, including the financial statements and related notes thereto, together
with the report of the independent auditors and other information with respect
to the Company, accompanies this Proxy Statement.
The Company is not aware of any other business to be presented at the 2000
Annual Meeting. If matters other than those described should properly arise at
the meeting, the proxies will vote on such matters in accordance with their best
judgments.
By Order of the Board Of Directors
/s/ Gary D. Cohen
-----------------
Gary D. Cohen, Executive Vice
President, General Counsel and
Secretary
Indianapolis, Indiana
June 8, 2000
18
<PAGE> 22
THE FINISH LINE, INC.
CLASS A COMMON STOCK
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS, JULY 20, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JULY 20, 2000 AT 9:00 A.M.
AT THE COMPANY'S CORPORATE OFFICES LOCATED AT
3308 N. MITTHOEFFER ROAD, INDIANAPOLIS, IN 46235
The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting of Stockholders and the accompanying Proxy Statement for the 2000
Annual Meeting and, revoking all prior Proxies, appoints Alan H. Cohen and
Steven J. Schneider, and each of them, with full power of substitution in each,
the Proxies of the undersigned to represent the undersigned and vote all shares
of Class A Common Stock of the undersigned in The Finish Line, Inc. at the
Annual Meeting of Stockholders to be held on July 20, 2000, and any
adjournments or postponements thereof upon the following matters and in the
manner designated on the reverse side of this proxy card.
(CONTINUED ON OTHER SIDE)
<TABLE>
<S> <C> <C>
A [X] PLEASE MARK YOUR --- |
VOTES AS IN THIS | |
EXAMPLE. | ------
FOR ALL NOMINEES WITHHOLD
LISTED AT RIGHT AUTHORITY
(EXCEPT AS MARKED TO VOTE FOR ALL
TO THE CONTRARY BELOW) NOMINEES LISTED
1. Election of [ ] [ ] NOMINEES: Alan H. Cohen 2. To transact such other business as
Directors David I. Klapper may properly come before the meeting
Jonathan K. Layne or any adjournments or postponements
(INSTRUCTION: to withhold authority to vote any Larry J. Sablosky thereof and as to which the
individual nominee, write that nominee's name on the Jeffrey H. Smulyan undersigned hereby confers
space provided below.) Stephen Goldsmith discretionary authority.
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 AS DIRECTORS OF
THE NOMINEES NAMED IN THE PROXY
STATEMENT, AND ACCORDING TO THE JUDGMENT
OF THE PROXIES WITH RESPECT TO PROPOSAL
2.
PLEASE MAKE, SIGN, DATE AND MAIL THIS
CARD PROMPTLY IN THE ENCLOSED ENVELOPE.
SIGNATURE(S) Dated: , 2000
------------------------------------------- ----------------------------------------- --------------------
SIGNATURE (IF HELD JOINTLY)
Note: Please sign as name(s) appears, Executors, administrators, guardians, officers of corporations, and other signing in a
fiduciary capacity should state their full title as such.
</TABLE>
