INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the registrant /x/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/x/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
DATA BROADCASTING CORPORATION
- ------------------------------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DATA BROADCASTING CORPORATION
- ------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/x/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or Rule
14a-6(i)(2).
/ / $500 per each party per Exchange Act Rule 14a-6(i)(3), or Rule
14a-6(i)(2).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
<PAGE>
DATA BROADCASTING CORPORATION
3490 Clubhouse Drive, I-2
Jackson, Wyoming 83001
October 4, 1996
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Data Broadcasting Corporation, a Delaware corporation (the "Company"), to be
held at the Continental Insurance Building, 180 Maiden Lane, New York, New York
on November 12, 1996 at 10:00 a.m. EST. The meeting will take place in the
Ricker Auditorium on the Mezzanine level.
The matters expected to be acted upon in the meeting are described in the
attached Notice of Annual Meeting of Stockholders and Proxy Statement. In
addition, we will report to you on the Company's progress during the past year
and receive your questions and comments concerning the Company.
It is important that your shares be represented at the meeting, whether or
not you are able to be present. Accordingly, we urge you to complete the
enclosed proxy and promptly return it to our vote tabulators in the postage
prepaid envelope provided. If you do attend the meeting and wish to vote in
person, you may withdraw your proxy at that time.
Alan J. Hirschfield Allan R. Tessler
Co-Chairman of the Board Co-Chairman of the Board
<PAGE>
DATA BROADCASTING CORPORATION
3490 Clubhouse Drive, I-2
Jackson, Wyoming 83001
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 12, 1996
TO THE STOCKHOLDERS OF DATA BROADCASTING CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Data
Broadcasting Corporation (the "Company") will be held on November 12, 1996 at
10:00 a.m. EST in the Ricker Auditorium on the Mezzanine level of the
Continental Insurance Building, 180 Maiden Lane, New York, New York for the
following purposes:
1. To elect nine directors to serve until the next annual meeting of the
Company or until their successors have been duly elected and
qualified;
2. To consider and vote on a proposal to ratify the appointment of Price
Waterhouse, LLP as the independent auditor of the Company for the
fiscal year ending June 30, 1997;
3. To consider and vote on a proposal to amend the Company Stock Option
Plan to increase the number of shares authorized for issuance.
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
The Board of Directors has fixed the close of business on September 30,
1996 as the record date for the determination of stockholders entitled to notice
of and to vote at this Annual Meeting and at any adjournment thereof.
Representation of at least a majority of all outstanding shares of common
stock of the Company is required to constitute a quorum. Accordingly, it is
important that your stock be represented at the Annual Meeting.
Whether or not you plan to attend the meeting, please complete, date and
sign the enclosed proxy card and return it in the enclosed envelope. You may
revoke your proxy at any time before it is voted.
By Order of the Board of Directors
Reed L. Benson
Secretary and General Counsel
Jackson, Wyoming
October 4, 1996
<PAGE>
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN
PERSON. WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE,
DATE, SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO
ENSURE YOUR REPRESENTATION AT THE ANNUAL MEETING. A RETURN ENVELOPE (WHICH IS
POSTAGE PREPAID IF MAILED IN THE UNITED STATES) IS ENCLOSED FOR THAT PURPOSE.
EVEN IF YOU HAVE GIVEN YOUR PROXY, YOU MAY STILL VOTE IN PERSON IF YOU ATTEND
THE ANNUAL MEETING. PLEASE NOTE, HOWEVER, THAT IF YOUR SHARES ARE HELD OF RECORD
BY A BROKER, BANK OR OTHER NOMINEE AND YOU WISH TO VOTE AT THE ANNUAL MEETING,
YOU MUST BRING TO THE MEETING A LETTER FROM THE BROKER, BANK OR OTHER NOMINEE
CONFIRMING YOUR BENEFICIAL OWNERSHIP OF THE SHARES. ADDITIONALLY, IN ORDER TO
VOTE AT THE ANNUAL MEETING, YOU MUST OBTAIN FROM THE RECORD HOLDER A PROXY
ISSUED IN YOUR NAME.
<PAGE>
PROXY STATEMENT
CONTENTS
INFORMATION CONCERNING VOTE............................................ 1
ELECTION OF BOARD OF DIRECTORS......................................... 1
SECURITY OWNERSHIP..................................................... 5
EXECUTIVE COMPENSATION AND OTHER INFORMATION........................... 7
REPORT OF THE COMPENSATION COMMITTEE AND THE STOCK
OPTION COMMITTEE ON EXECUTIVE OFFICERS' COMPENSATION... ............. 11
PERFORMANCE GRAPH...................................................... 13
AMENDMENT OF STOCK OPTION PLAN......................................... 13
PROPOSAL TO RATIFY SELECTION OF AUDITOR................................ 16
CERTAIN RELATIONSHIPS AND OTHER TRANSACTIONS........................... 16
SOLICITATION........................................................... 16
STOCKHOLDER PROPOSALS.................................................. 17
STOCKHOLDER NOMINATION OF DIRECTORS.................................... 17
OTHER MATTERS.......................................................... 17
<PAGE>
DATA BROADCASTING CORPORATION
3490 Clubhouse Drive, I-2
Jackson, Wyoming 83001
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD
ON NOVEMBER 12, 1996
INFORMATION CONCERNING VOTE
GENERAL
The enclosed proxy is solicited on behalf of the Board of Directors of Data
Broadcasting Corporation, a Delaware corporation ("DBC" or the "Company"), for
use at the annual meeting of stockholders to be held on November 12, 1996 at
10:00 a.m. EST, or at any adjournment thereof (the "Annual Meeting"), for the
purposes set forth herein and in the accompanying Notice of Annual Meeting of
Stockholders. The Annual Meeting will be held at the Continental Insurance
Building, Ricker Auditorium - Mezzanine level, 180 Maiden Lane, New York, New
York. The Company intends to mail this Proxy Statement and accompanying proxy
card on or about October 7, 1996 to all stockholders entitled to vote at the
Annual Meeting.
VOTING RIGHTS AND OUTSTANDING SHARES
Only holders of record of common stock at the close of business on
September 30, 1996 will be entitled to notice of and to vote at the Annual
Meeting. At the close of business on September 30, 1996, the Company had
31,238,583 shares of common stock outstanding and entitled to vote. On all
matters to be voted upon at the Annual Meeting, each holder of record of common
stock on such date will be entitled to one vote for each share held.
REVOCABILITY OF PROXIES
Any person giving a proxy pursuant to this solicitation has the power to
revoke it at any time before it is voted. It may be revoked by filing with the
Secretary of the Company at the Company's principal executive office, 3490
Clubhouse Drive, I-2, Jackson, Wyoming 83001, a written notice of revocation or
a duly executed proxy bearing a later date, or it may be revoked by attending
the Annual Meeting and voting in person. Attendance at the Annual Meeting will
not, by itself, revoke a proxy.
TABULATION OF VOTES
All votes will be tabulated by the inspector of election appointed for the
Annual Meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes. Abstentions and broker non-votes will be
counted as present in determining whether the quorum requirement is satisfied.
Abstentions will be counted towards the tabulation of votes cast on proposals
presented to the stockholders and will have the same effect as negative votes.
Broker non-votes are not counted for any purpose in determining whether a matter
has been approved.
ELECTION OF BOARD OF DIRECTORS
The Board of Directors has nominated nine persons for the Board positions
presently authorized in the Company's bylaws. Each director to be elected will
hold office until the next annual meeting of stockholders and until his
successor is elected and has qualified, or until such director's earlier death,
resignation or removal. All nominees listed below are currently directors of the
Company.
1
<PAGE>
Shares represented by executed proxies will be voted, if authority to do so
is not withheld, for the election of the nine nominees named below. Shares may
not be voted cumulatively. In the event that any nominee should be unavailable
for election as a result of an unexpected occurrence, such shares will be voted
for the election of such substitute nominee as the Board of Directors may
propose. Each person nominated for election has agreed to serve if elected, and
the Company has no reason to believe that any nominee will be unable to serve.
Pursuant to the Company's By-laws, the nine candidates receiving the
greatest number of votes shall be elected as directors. Pursuant to the
Company's By-laws, any record stockholder who desires to nominate candidates for
election to the Board must deliver written notice to the Secretary of the
Company no later than 60 days in advance of the Annual Meeting or 10 days after
the date on which notice of the Annual Meeting is given, whichever is later.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF THIS PROPOSAL
NOMINEES
The names of the nominees and certain information about them are set forth
below:
<TABLE>
<CAPTION>
Name Director Since Age(1) Office Held with the Company
- ---- -------------- --- ----------------------------
<S> <C> <C> <C>
Alan J. Hirschfield 1992 60 Co-Chairman of the Board, Co-CEO
Allan R. Tessler 1992 59 Co-Chairman of the Board, Co-CEO
Dwight H. Egan 1995 43 CEO of Broadcast International, Inc.
James A. Kaplan 1994 53 President of CMS
Charles M. Diker 1993 61 Director
Donald P. Greenberg 1996 62 Director
David R. Markin 1992 65 Director
Herbert S. Schlosser 1995 70 Director
Carl Spielvogel 1996 67 Director
</TABLE>
- -------------
(1) As of September 15, 1996
ALAN J. HIRSCHFIELD AND ALLAN R. TESSLER serve as Co-Chairmen of the Board and
Co-Chief Executive Officers of the Company.
Prior to becoming Co-Chief Executive Officer of the Company in June, 1992, Mr.
Hirschfield served as Managing Director of Schroder Wertheim & Co. Inc. and as a
consultant to the entertainment and media industry. He formerly served as Chief
Executive Officer of Twentieth Century Fox Film Corp. and Columbia Pictures Inc.
from 1980 to 1985 and 1973 to 1978, respectively. Mr. Hirschfield currently
serves on the boards of Cantel Industries, Inc., ("Cantel") a distributor of
medical and scientific equipment and Chyron Corporation, ("Chyron") a supplier
of graphics to the television industry.
In addition to serving as Co-Chief Executive Officer since June 1992, Mr.
Tessler has been Chairman of the Board and CEO of International Financial Group,
Inc., an international merchant banking firm, since 1987. He is also Chairman of
the Board of Great Dane Holdings, Inc. ("Great Dane"), a diversified holding
company, Enhance Financial Services Group Inc. ("Enhance"), a municipal bond
reinsurer, and Jackpot Enterprises, Inc. ("Jackpot"), a gaming machine route
operator. From December 1991 through September 1993 Mr. Tessler was Chairman of
the Board and CEO of Ameriscribe Corporation, a national provider of facilities
management services. Mr. Tessler also serves on the boards of The Limited, Inc.,
Allis-Chalmers Corporation and New T&T DBC Limited, a joint-venture between the
Company and New T&T Hong Kong Limited, a wholly-owned subsidiary of Wharf
Communications Investments, Ltd.
2
<PAGE>
Messrs. Hirschfield and Tessler were appointed to serve as a restructuring team
to address the financial problems of Financial News Network Inc. ("FNN"), and in
that capacity served as Co-Chief Executive Officers of FNN from October 1990
until June 1992. Certain of the Company's operations were formerly owned by FNN.
On June 26, 1992, the effective date of FNN's plan of reorganization under
Federal bankruptcy laws (the "Plan"), the Company was spun off from FNN. Both
Messrs. Hirschfield and Tessler currently serve as directors of the FNN Estate,
having been named to the board in June 1991. From October 1990 until September
1992, both also served as Co-Chief Executive Officers of Infotechnology, Inc.
("Infotech"), an integrated information technology and communications concern.
Infotech was formerly a beneficial owner of approximately 46% of FNN's stock.
Mr. Tessler served as a director of Infotech from August 1989 until October
1990, when he was appointed as FNN's Co-Chief Executive Officer. He rejoined the
board of Infotech in June 1991, along with Mr. Hirschfield. Both resigned their
directorships of Infotech in September 1992. FNN and Infotech each filed for
reorganization under Chapter XI of the Bankruptcy Code in March 1991.
DWIGHT H. EGAN is the President and Chief Executive Officer of Broadcast
International, Inc. ("BII"), a subsidiary of the Company. He has held these
positions since 1985. Acquired by DBC in 1995, BII supplies business
information, real-time financial market data and communications services to
retail, financial and other business customers. Mr. Egan also serves on the
Board of Directors of Gentner Communications, Inc., a manufacturer of
teleconferencing equipment.
JAMES A. KAPLAN is President and founder of Capital Management Sciences ("CMS"),
a division of the Company. He has held this position since CMS was founded in
1979. Acquired by DBC in 1994, CMS distributes fixed income portfolio analytics
and information.
CHARLES M. DIKER is a limited partner with the investment management company of
Weiss, Peck & Greer, having been associated with that firm since 1976. He serves
as Chairman of the Board of Cantel and Blanchard and Blanchard, a manufacturer
and marketer of specialty foods. Mr. Diker currently serves on the Board of
Directors of BeautiControl Cosmetics, a direct marketer of cosmetics, Chyron
Corporation, and International Specialty Products, a chemical company.
DONALD P. GREENBERG has been a professor at Cornell University, Ithaca, New
York, for the past 30 years. He is Jacob Gould Sherman professor of computer
graphics and director, program of computer graphics at Cornell University,
Ithaca, New York. In 1987, Dr. Greenberg received the ACM SIGGRAPH Steven A.
Coons award for outstanding creative contributions to computer graphics and in
1991 was named a member of the National Academy of Engineering. He is the
founding director of the National Science Foundation's Science and Technology
Center for Computer Graphics and Scientific Visualization.
DAVID R. MARKIN has been the President and Chairman of the Board of Checker
Motors Corporation, a manufacturer, insurer, and operator of transportation
equipment, since 1970 and President of Great Dane since 1989. Mr. Markin served
as a director of FNN from July 1991 until June 1992, and as a director of
Infotech from July 1991 until September 1992. Mr. Markin also serves as a
director of Jackpot and Enhance.
HERBERT S. SCHLOSSER has been Senior Advisor, Broadcasting and Entertainment, of
Schroder Wertheim & Co. Inc., since 1989 and for 30 years was employed by
National Broadcasting Company, Inc. ("NBC") in various capacities, including
President and CEO of NBC and Executive Vice President of RCA Corporation in
charge of its entertainment group of activities other than NBC. Mr. Schlosser is
a member of the Board of Directors of U.S. Satellite Broadcasting Company, Inc.,
a partner with DirecTV, a subsidiary of Hughes Aircraft, in the first high-power
DBS satellite launched in the U.S. He is also Chairman of the Board of Trustees
of the American Museum of the Moving Image.
3
<PAGE>
CARL SPIELVOGEL is Chairman and Chief Executive Officer of the United Auto
Group, Inc., a privately held operator of multiple-franchise auto dealerships.
Mr. Spielvogel was associated with Bates Worldwide, an advertising and marketing
communications company, from July 1987 until January 1, 1994. He served in
various positions with Bates Worldwide including chairman and Chief Executive
Officer. He was vice chairman of the executive committee and a member of the
board of directors of Interpublic Group of Companies, Inc. for approximately 20
years. Mr. Spielvogel is a member of the boards of directors of Hasbro, Inc.,
Allint Food Service, Inc., (formerly Kraft Food Service, Inc.), Foamex
International, Inc., and the United Auto Group, Inc.
There are no family relationships among the directors or executive officers of
the Company.
BOARD COMMITTEES AND MEETINGS
During the fiscal year ended June 30, 1996, the Board of Directors held
four meetings and took one action by written consent. The Board has an Audit
Committee, Compensation Committee and Stock Option Committee.
The Audit Committee may take any and all actions which may be taken by the
Board of Directors of the Company to review and supervise the financial controls
of the Company, including recommending to the Board the selection of the
Company's independent auditors, reviewing the Company's financial statements,
reviewing the scope and results of external audits, acting upon recommendations
of the auditors, reviewing the Company's proposed budgets, reporting to the
Board any considerations or recommendations the Audit Committee may have with
respect to such matters and taking such further actions as the Committee deems
necessary. During fiscal 1996, the Audit Committee, composed of Charles M.
Diker, David R. Markin and Herbert S. Schlosser, met twice.
The Compensation Committee may take any and all actions which may be taken
by the Board of Directors of the Company to review and approve executive and
senior management compensation. During fiscal 1996, the Compensation Committee,
composed of Charles M. Diker, David R. Markin and Herbert S. Schlosser, met
once.
The Stock Option Committee was established to serve as Administrator of the
Company's Stock Option Plan. As Plan Administrator, the Stock Option Committee
has full and final authority to select employees to be granted options and to
determine the number of shares and terms of any options granted. The Stock
Option Committee also considers and recommends to the Board whether grants to
officers, directors and employees, other than pursuant to the Stock Option Plan,
should be made. During fiscal 1996, the Stock Option Committee was composed of
Alan J. Hirschfield and Allan R. Tessler, met three times and took five actions
by written consent.
All current nominees who were directors during the fiscal year ended
June 30, 1996, attended all meetings of the Board and all committees of the
Board of which they were members.
For information regarding compensation received by directors, see
"Executive Compensation and Other Information - Compensation of Directors".
4
<PAGE>
SECURITY OWNERSHIP (1)
The following table sets forth the beneficial ownership of the common
stock of the Company, at September 15, 1996, by each director, nominee,
executive officer named in the Summary Compensation Table appearing below, and
each person who, to the knowledge of the Company, owned beneficially more than
5% of the Company's common stock.
<TABLE>
<CAPTION>
Beneficial Ownership
-----------------------------------------
Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Total(2)
- ---------------- -------------------- ----------
<S> <C> <C>
Robert Fleming, Inc. 2,882,480 - Direct 9.23%
320 Park Avenue
New York, NY 10022
Alan J. Hirschfield(3) 2,272,845 - Indirect(4) 7.24%
Co-Chairman of the Board, Co-CEO
Allan R. Tessler(3) 2,382,059 - Direct(5) 7.59%
Co-Chairman of the Board, Co-CEO
Capital Research and Management, Inc. 2,000,000 - Direct 6.40%
333 South Hope Street
Los Angeles, CA 90071
Charles M. Diker 400,400 - Direct(6) 1.62%
Director 107,227 - Indirect(7)
Dwight H. Egan 434,110 - Direct(8) 1.43%
Director, President and CEO of BII 18,665 - Indirect(9)
James A. Kaplan 886,660 - Direct(10) 3.91%
Director, President of CMS 342,447 - Indirect(11)
David R. Markin 560,000 - Direct(12) 1.79%
Director 5,000 - Indirect(13)
Herbert S. Schlosser 50,070 - Direct(14) *
Director
Donald P. Greenberg 35,000 - Direct(15) *
Director
Carl Spielvogel 35,000 - Direct(15) *
Director
Mark F. Imperiale 116,667 - Direct(15) *
President, Chief Operating Officer
and Chief Financial Officer
Edward Anderson 86,666 - Direct(15) *
President--Information Services Division
All current directors, nominees and
executive officers as a group (11 persons) 7,732,816(16) 23.72%
</TABLE>
- --------------
* Less than one percent
5
<PAGE>
(1) The table in this section is based upon information supplied by officers,
directors and principal stockholders and Schedules 13D and 13G, if any,
filed with the SEC. Unless otherwise indicated in the footnotes to the
table and subject to the community property laws where applicable, each of
the stockholders named in this table has sole voting and investment power
with respect to the shares shown as beneficially owned by him.
(2) Applicable percentage of ownership for the officers and directors is based
on 31,238,583 shares of common stock, which were outstanding on September
15, 1996.
(3) Owner's address is in care of the Company at 3490 Clubhouse Drive, I-2,
Jackson, Wyoming 83001.
(4) Held of record directly by AJH Company, an entity of which Mr. Hirschfield
is the beneficial owner. Includes 150,000 shares which may be acquired upon
exercise of presently exercisable options.
(5) Includes 150,000 shares which may be acquired upon exercise of presently
exercisable options.
(6) Includes 80,000 shares which may be acquired upon exercise of presently
exercisable options or options which may be exercised within 60 days of the
effective date of this table. See "Executive Compensation and Other
Information--Compensation of Directors," below.
(7) Includes 92,227 shares in investment accounts managed by Mr. Diker, over
which he exercises shared investment power. Includes 15,000 shares in an
investment account held by Mr. Diker's wife, over which he exercises shared
investment power.
(8) Includes 264,858 shares which may be acquired upon exercise of presently
exercisable options. See "Executive Compensation and Other Information--
Compensation of Directors," below.
(9) Includes 17,314 shares held in seven separate custodial accounts, the sole
custodian of each being Mr. Egan's wife. Includes 1,351 shares held by a
trust over which Mr. Egan exercises sole investment power.
(10) Includes 208,500 shares which may be acquired upon exercise of options
which may be exercised within 60 days of the effective date of this table.
(11) Represents shares held by a trust over which Mr. Kaplan exercises shared
investment power. Includes 67,200 shares which may be acquired upon
exercise of options which may be exercised within 60 days of the effective
date of this table.
(12) Includes 180,000 shares which may be acquired upon exercise of presently
exercisable options or options which may be exercised within 60 days of the
effective date of this table. See "Executive Compensation and Other
Information--Compensation of Directors," below.
(13) Represents shares in an investment account held by Mr. Markin's wife, over
which he exercises shared investment power.
(14) Includes 45,000 shares which may be acquired upon exercise of presently
exercisable options or options which may be exercised within 60 days of the
effective date of this table. See "Executive Compensation and Other
Information--Compensation to Directors," below.
(15) Represents shares which may be acquired upon exercise of presently
exercisable options or which may be exercised within 60 days of the
effective date of this table. See "Executive Compensation and Other
Information--Stock Option Grants," below.
6
<PAGE>
(16) Includes 1,418,891 shares which may be acquired upon exercise of presently
exercisable options or options which may be exercised within 60 days of the
effective date of this table. See "Executive Compensation and Other
Information--Stock Option Grants" and "Executive Compensation and Other
Information--Compensation of Directors," below.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table sets forth certain summary information concerning
compensation paid or accrued to or on behalf of the Company's Co-Chief Executive
Officers and each of the four other most highly compensated executive officers
of the Company (determined as of the end of the last fiscal year) for the three
year period ended June 30, 1996.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
------------------------ ------------
Name and All Other
Principal Options Compensation
Position Year Salary($) Bonus($) (#) ($)
--------- ---- --------- ------- ------- ------------
<S> <C> <C> <C> <C> <C>
Alan J. Hirschfield 1996 $315,000 $125,000 -- $196,731(1)
Co-Chairman of the Board and 1995 $315,000 -- -- $396,341(1)
Co-Chief Executive Officer 1994 $315,000 -- -- $ 902(1)
Allan R. Tessler 1996 $315,000 $125,000 -- $196,731(1)
Co-Chairman of the Board and 1995 $315,000 -- -- $396,341(1)
Co-Chief Executive Officer 1994 $315,000 -- -- $ 902(1)
James A. Kaplan(2) 1996 $454,168 -- -- $ 3,135(3)
President - CMS 1995 $429,299 -- -- $ 500(3)
1994 $177,083 --
Mark F. Imperiale(4) 1996 $250,008 $175,000 50,000 $ 4,008(3)
Executive Vice President and 1995 $210,000 $125,000 100,000
Chief Financial Officer
Edward Anderson(5) 1996 $200,312 $ 75,000 75,000 $ 2,678(3)
President - Information
Services Division
Dwight H. Egan(5) 1996 $214,258 -- 150,000 5,522(3)
President, Broadcast
International, Inc.
</TABLE>
- -------------------
(1) Represents commissions paid pursuant to the contracts entered into in 1990
between Messrs Hirschfield and Tessler and FNN to serve as FNN's
restructuring Team. The amounts were based on the proceeds received
primarily from the Consumer News and Business Channel and other assets
of FNN.
(2) Mr. Kaplan was hired effective February 1, 1994, with the Company's
acquisition of CMS. Compensation for fiscal 1994 does not include options
received by Mr. Kaplan upon the sale of CMS to the Company.
(3) Matching contribution to the Company's 401(k) plan.
(4) Mr. Imperiale was hired effective July 1, 1994.
(5) Mr. Egan was hired effective July 1, 1995, with the Company's acquisition
of Broadcast International. Mr. Anderson was named president October 1,
1995.
7
<PAGE>
STOCK OPTION GRANTS
Set forth below is information on grants of stock options under the
Company's Stock Option Plan for the named executive officers for the period July
1, 1995 to June 30, 1996:
<TABLE>
<CAPTION>
OPTION GRANTS IN LAST FISCAL YEAR
Individual Grants Grant Value
--------------------------------------------------------------------------- ---------------
% of Total
Options
Options Granted to Exercise Grant Date
Granted Employees Price Stock Price Expiration Grant Date
Name (#) in Fiscal Year ($ per share) ($ per share) Date Present Value
- ---- ------- -------------- ------------- ------------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mark F. Imperiale 50,000 4.4% $8.00 $8.00 11/01/05 $250,000
Dwight H. Egan 150,000 13.2% $6.13 $6.13 07/18/05 $574,500
Edward Anderson 75,000 6.6% $6.81 $6.81 10/09/05 $321,750
</TABLE>
All options reported above were awarded under the Company's 1992
stockholder-approved Stock Option Plan, as amended (the "Option Plan"). The
Company has not granted any stock appreciation rights. Pursuant to the terms of
the Option Plan, the exercise price per share for all options is the average of
the high asked and low bid prices of the Company's common stock on the date of
grant.
The options reported above for Messers. Imperiale, Egan and Anderson become
exercisable in three equal installments on the first, second and third
anniversaries of the date the option was granted. The exercisability of options
is subject to acceleration upon termination of the optionee's employment on
account of disability or without cause, and in any event the Stock Option
Committee of the Board may waive conditions to exercisability and accelerate the
exercisability of the options for other reasons, including upon a change in
control of the Company.
The option exercise price and the income tax withholding amounts payable
upon any option exercise may be paid in cash or, in certain circumstances, by
the optionee delivering already owned shares of the Company's common stock or
the Company withholding a sufficient number of shares from the number of shares
issuable upon such exercise.
"Grant Date Present Value" is determined under the Black-Scholes pricing
model, a widely recognized method of determining the present value of options.
The actual value, if any, an executive officer may realize will depend on the
extent to which conditions to exercisability of the option are satisfied and the
excess of the stock price over the exercise price on the date the option is
exercised. It is highly unlikely that the value realized by Messrs. Imperiale,
Egan and Anderson will be consistent with the value estimated by the
Black-Scholes model. The estimated values under that model are based on
assumptions regarding interest rates, stock price volatility and future dividend
yield. The model is used for valuing market traded options and is not directly
applicable to valuing stock options granted under the Company's stock option
plan which cannot be transferred.
AGGREGATED STOCK OPTION EXERCISES
The following table provides information concerning the exercise of stock
options during the last fiscal year and unexercised stock options held as of the
end of the fiscal year by the named executive officers.
8
<PAGE>
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
<CAPTION>
Number of Unexercised Dollar Value of Unexercised
Options at In-the-Money Options
FY-End at FY-End
------------------------------- --------------------------------
Shares Dollar
Acquired Value
Name on Exercise Realized Exercisable Un-exercisable Exercisable Un-exercisable
---- ----------- -------- ----------- -------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Alan J. Hirschfield 0 0 150,000 0 1,040,700 0
Allan R. Tessler 0 0 150,000 0 1,040,700 0
Dwight H. Egan 0 0 214,858 150,000 1,148,408 403,125
James A. Kaplan 0 0 0 436,525 0 2,599,506
Mark F. Imperiale 0 0 66,667 83,333 291,668 214,582
Edward Anderson 0 0 55,834 86,666 194,274 243,414
</TABLE>
The value of unexercised options at fiscal year-end is the difference
between the option exercise price and the average of the high ask and low bid
price for the Company's common stock as reported by the Nasdaq Stock Market's
National Market ("Nasdaq") for June 30, 1996, which was $9.38. These amounts
have not been, and may never be, realized. Actual amounts realized will depend
on the value of the Company's common stock if and when options become
exercisable and are exercised.
COMPENSATION OF DIRECTORS
During fiscal year 1996, all non-employee directors of the Company received
an annual fee of $5,000 and reimbursement for travel expenses for service to the
Board of Directors. All Audit Committee members also received an annual fee of
$1,250 as compensation for their service on the committee. No employee director
received compensation for service to the Board.
On September 12, 1995, upon his election as a director, the Stock Option
Committee granted to Mr. Schlosser an immediately exercisable option for 25,000
shares of common stock at an exercise price of $9 3/8 per share. The option
terminates, to the extent not exercised prior thereto, upon the earlier of (i)
the tenth anniversary of the grant or (ii) the first anniversary of the
cessation of the optionee's service as a director of the Company.
On February 12, 1996, Messers. Greenberg and Spielvogel were each granted
by the Stock Option Committee an immediately exercisable option to acquire
25,000 shares of common stock at an exercise price of $10.625 per share. The
option terminates, to the extent not exercised prior thereto, upon the earlier
of (i) the tenth anniversary of the grant or (ii) the first anniversary of the
cessation of the optionee's service as a director of the Company.
Each non-employee director of the Company holding such position on the
third business day after the Company publicly announces its summary fiscal
year-end statement of sales and earnings shall, at the discretion of the Stock
Option Committee, receive an option to acquire 10,000 shares of common stock
with an exercise price equal to the fair market value of the stock on such date.
On September 15, 1995, each non-employee director was granted options for 10,000
shares of common stock at an exercise price of $8 13/16, which become
exercisable on the first anniversary of the date
9
<PAGE>
of grant, subject to acceleration upon the occurrence of certain prescribed
events. Each option terminates, to the extent not exercised prior thereto, upon
the earlier of (i) the tenth anniversary of the grant or (ii) the first
anniversary of the cessation of the optionee's service as a director of the
Company.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL
ARRANGEMENTS
The Company entered into an employment agreement with Mr. Kaplan, President
of CMS, effective April 29, 1994. The agreement provides for a three year term
of employment at a base salary of $425,000, $450,000 and $475,000 in each of the
three years, respectively. The agreement also provides for a subsequent three
year consultancy period during which Mr. Kaplan will be paid $333,333 a year for
part-time consulting services. Mr. Kaplan is prohibited from competing with the
Company during the entire term of the agreement. Mr. Kaplan's right to receive
the compensation specified in the latter three year period is subject only to
his continuing compliance with the non-compete restrictions.
The Company entered into an employment agreement with Mark F. Imperiale,
Executive Vice President and Chief Financial Officer of the Company, as of July
1, 1994. The agreement provides for a two year term and a base salary of
$210,000 subject to increases, with a provision for bonuses based on Mr.
Imperiale's performance and the Company's financial performance. His salary was
increased to $250,000 for fiscal year 1996. In the event of a change-in-control
of DBC, Mr. Imperiale has the right to terminate the agreement and receive a
lump sum severance payment equal to the base salary plus a bonus of 50% of the
base salary, for the greater of (i) one year or (ii) the remainder of the
employment period. Mr. Imperiale is prohibited from competing with the Company
for one year following his termination of employment. The terms of the
employment agreement are still in force. In September Mr. Imperiale was
appointed President, Chief Operating Officer and Chief Financial Officer.
Broadcast International, Inc. ("Broadcast") and Mr. Egan have entered into
a termination benefit agreement dated January 1, 1992. This agreement provides
that Mr. Egan is entitled to receive termination benefits if a change in control
of Broadcast occurs and, within three years thereafter, Broadcast terminates his
employment for any reason other than for "cause" (as defined in the agreement).
The change in control occurred upon the merger with the Company. Pursuant to the
agreement, the termination benefits generally include a lump-sum payment of an
amount equal to three times his average annual compensation for the most recent
five calendar years ending coincident with or immediately before the change in
control. The agreement also provides that the Company is obligated to pay or
reimburse up to $250,000 in legal expenses incurred by him should the
enforceability of such agreement be challenged and other provisions typical for
these types of termination benefits.
The Company currently has no other compensation plan or arrangement with
respect to any of the executive officers named on the Summary Compensation
Table, which results or will result from the resignation, retirement, or other
termination of such individual's employment with the Company or from a change in
control of the Company or a change in the individual's responsibilities
following a change in control. However, as noted under the Stock Option Grant
Table above, the Stock Option Committee of the Board may accelerate the
exercisability of employee stock options granted under the Option Plan upon a
change in control of the Company.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the past fiscal year, Messrs. Hirschfield and Tessler served on the
Stock Option Committee.
Mr. Markin, a member of the Company's Compensation Committee, is President
of Great Dane, an entity which does not have a compensation committee. Mr.
Tessler, Co-Chief Executive Officer of the Company, is a member and Chairman of
Great Dane's board of directors.
10
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE
AND THE STOCK OPTION COMMITTEE
ON EXECUTIVE OFFICERS' COMPENSATION
Decisions regarding compensation of the Company's executive officers are
made by the Compensation Committee of the Board, except that decisions as to the
granting of options under the Company's Stock Option Plan are made by the Stock
Option Committee of the Board. In making decisions on compensation, the
Compensation Committee solicits and receives the recommendations of the Co-Chief
Executive Officers, with recommendations relating to the grant of options being
considered by the Compensation Committee prior to being referred to the Stock
Option Committee.
COMPENSATION POLICIES FOR EXECUTIVE OFFICERS
The Compensation Committee desires to set compensation at levels and
through arrangements that will attract and retain managerial talent desired by
the Company, reward employees for past contributions and motivate managerial
efforts consistent with corporate growth, strategic progress and the creation of
stockholder value. The Compensation Committee believes that a mix of salary,
incentive bonus and stock options will achieve those objectives.
RELATIONSHIP OF PERFORMANCE TO EXECUTIVE COMPENSATION
The base salaries of Messrs. Kaplan and Imperiale were set by terms of
their employment agreements which were negotiated to attract and retain them.
The Compensation Committee believes these salaries are competitive and represent
a fair estimate of the value of the services rendered by Messrs. Kaplan and
Imperiale to the Company. Effective July 1, 1995, the Compensation Committee
approved a salary increase of $40,000 for Mr. Imperiale pursuant to his
employment agreement described previously reflecting his contributions to the
Company's improved financial position and the strategic business changes
engineered under his direction.
The Compensation Committee awarded Mr. Imperiale a bonus for the fiscal
year that was based upon the Company's results of operations, the completion of
the integration of BII and its subsidiaries with the Company, and the successful
conclusion of arbitration proceedings regarding the prior sale of certain media
assets of FNN.
Options were awarded during the fiscal year to enhance Mr. Imperiale's
financial interest in the performance of the Company's stock and reward him for
the results of operations under his direction. These options seek to promote Mr.
Imperiale's long-term interest in the Company by vesting over a three-year
period and expiring in ten years.
The number of options awarded to Mr. Imperiale was based upon the
recommendation of the Co-Chief Executive Officers. This recommendation was based
upon the objectives of the Company during Mr. Imperiale's employment period.
Mr. Egan's base salary was set coincident with the acquisition of BII and
the grant of options similarly made. His compensation package was structured to
induce him to remain with the Company following the acquisition.
BASIS FOR THE COMPENSATION OF THE CO-CHIEF EXECUTIVE OFFICERS
The base salaries of the Co-Chief Executive Officers ("Co-CEOs") were set
at a level consistent with other chief executives at comparable companies
considering the financial performance of the Company. The Co-Chief Executive
Officers received bonuses based on the Company's results of operations, the
completion of the integration of BII and its subsidiaries with the Company, and
the successful conclusion of arbitration proceedings regarding the prior sale of
certain media assets of FNN.
11
<PAGE>
Respectfully submitted,
COMPENSATION COMMITTEE STOCK OPTION COMMITTEE
Herbert S. Schlosser Alan J. Hirschfield, Co-Chairman
Charles M. Diker Allan R. Tessler, Co-Chairman
David R. Markin
12
<PAGE>
PERFORMANCE GRAPH
The graph presented below compares the cumulative total return of the
Company, the Nasdaq U.S. market index and the Nasdaq Non-Financial index from
June 30, 1992 through June 30, 1996. Total return is based on an assumed
investment of $100 on June 30, 1992 and reinvestment of dividends through June
30, 1996.
[GRAPHIC OMITTED]
<TABLE>
<CAPTION>
6/92 6/93 6/94 6/95 6/96
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
DBC 100 200 256 300 468
Nasdaq U.S. 100 126 127 169 218
Nasdaq Non- 100 125 122 165 212
Financial
</TABLE>
PROPOSAL TO INCREASE THE NUMBER OF SHARES AUTHORIZED FOR ISSUANCE
UNDER THE STOCK OPTION PLAN
PROPOSED AMENDMENT
Pursuant to prior Company action and shareholder approval, 5,750,000 shares
were authorized for issuance under the Option Plan, of which 460,058 shares
remain available for future grants, as of September 15, 1996. The Board of
Directors believes that stock options have been and will continue to be an
important compensation element in attracting and retaining quality personnel and
in compensating and retaining management of future acquisitions. The Board of
Directors believes that an increase in the authorized shares under the Option
Plan is in the best interests of the Company in order to attract new executives
and retain key employees. Accordingly, in September, 1996, the Board of
Directors adopted, subject to shareholder approval, an amendment to the Option
Plan that provides for an increase in the number of shares authorized for
issuance under the Option Plan by an additional 1,500,000 shares to an aggregate
of 7,250,000 shares.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF THIS PROPOSAL
13
<PAGE>
SUMMARY OF OPTION PLAN
The purpose of the Option Plan is to enable the Company to attract, retain
and motivate persons employed by the Company and its subsidiaries, including
officers and directors, in a managerial capacity on a full-time basis ("Eligible
Employees") and directors who are not Eligible Employees, by providing for
proprietary interests of such individuals in the Company.
The Option Plan authorizes the Stock Option Committee to grant to
participants in the Option Plan options to purchase Common Stock at 100% of the
fair market value of the stock at the date of the grant of the options. The fair
market value of the stock as of a date shall be deemed to equal the average of
the high asked and low bid prices during each trading day in the
over-the-counter market, as reported by Nasdaq, or any then operative successor
to Nasdaq, for such date or, if the stock is then listed on a national
securities exchange, the average of the high and low transaction prices reported
through the consolidated reporting system for such date.
Options granted to Eligible employees under the Option Plan may include
arrangements such as restricted stock, limited rights that are exercisable only
following designated events, and stock appreciation rights. An award may consist
of one such arrangement or two or more such arrangements in tandem or in the
alternative. Any stock option granted to Eligible Employees under the Option
Plan may be a tax benefited incentive option (in which case it may only be
granted to employees and certain other restrictions will apply), or it may be a
non-qualified stock option that is not tax benefited (in which case it may be
issued to both employees and non-employees, and few, if any, legal restrictions
will apply).
The Option Plan provides that options shall either be assumed by a
successor corporation or shall terminate upon the dissolution or liquidation of
the Company, upon the merger or consolidation of the Company as a result of
which its Common Stock is changed into or exchanged for cash or property or
another company's securities, and upon the acquisition of more than eighty
percent (80%) of the voting power of the Company's stock by another corporation,
person or group. The Stock Option Committee may provide in the instrument
evidencing an option granted to an Eligible Employee that it shall become fully
exercisable upon the occurrence of other events (such as upon a participant's
termination of employment following a change in corporate control) and may
provide for the exercisability of stock appreciation rights upon the occurrence
of any of the foregoing events and may grant rights associated with options
granted under the Option Plan that are exercisable only upon such events.
Subject to the express requirements under the Option Plan, the terms of any
and all awards granted to Eligible Employees will be determined by, and subject
to the conditions imposed by, the Stock Option Committee, including provisions
as to the exercisability, vesting, expiration, termination or forfeiture of
options. No option granted under the Option Plan may be exercised in whole or in
part more than ten years after its grant.
An award under the Option Plan may permit the recipient to pay all or part
of the purchase price of the shares issuable pursuant thereto, or to pay all or
part of such recipient's tax withholding obligation with respect to such
issuance, by delivering previously owned shares of stock of the Company.
No options or stock appreciation right granted under the Option Plan may be
transferred other than by will or the laws of descent and distribution, and the
award may be exercised during the recipient's lifetime only by the recipient or
his or her guardian or legal representative.
The Company is vested with authority under the Option Plan to assist any
employee to whom an option is granted thereunder (including any director or
officer of the Company or any of its subsidiaries who is also an employee) in
the payment of the purchase price payable on exercise of that option, by lending
the amount of such purchase price to such employee on such terms and at
14
<PAGE>
such rates of interest and upon such security (or unsecured) as shall have
been authorized by or under authority of the Stock Option Committee.
The Board may alter, amend, suspend, or terminate the Option Plan, provided
that no such action shall deprive an optionee, without his or her consent, of
any option granted to the optionee pursuant to the Option Plan or of any of his
or her rights under such option. Provisions related to automatic grants of
options to non-employee directors may not (with limited exception) be amended
more frequently than once every six months and no amendment to such provisions,
unless approved by the stockholders of the Company, shall become effective
earlier than six months after Board approval. Except as provided in the Option
Plan, no amendment by the Board, unless taken with the approval of the
stockholders of the Company, may:
(i) materially increase the benefits accruing to participants under the
Option Plan;
(ii) materially increase the number of securities which may be issued under
the Option Plan; or
(iii) materially modify the requirements as to eligibility for
participation in the Option Plan.
FEDERAL INCOME TAX TREATMENT OF STOCK PLAN
The following is a brief description of the federal income tax treatment
which will generally apply to benefits or awards (hereinafter, "awards") made
under the Option Plan, based on federal income tax laws in effect on the date
hereof. The exact federal income tax treatment of awards will depend on the
specific nature of any such award. Such an award may, depending on the
conditions applicable to the award, be taxable as an option, an award of
restricted or unrestricted stock, an award which is payable in cash, or
otherwise. BECAUSE THE FOLLOWING PROVIDES ONLY A BRIEF SUMMARY OF THE GENERAL
FEDERAL INCOME TAX RULES, INDIVIDUALS SHOULD NOT RELY THEREON FOR INDIVIDUAL TAX
ADVICE, AS EACH TAXPAYER SITUATION AND THE CONSEQUENCES OF ANY PARTICULAR
TRANSACTION WILL VARY DEPENDING UPON THE SPECIFIC FACTS AND CIRCUMSTANCES
INVOLVED. RATHER, EACH TAXPAYER IS ADVISED TO CONSULT WITH HIS OR HER OWN TAX
ADVISOR FOR PARTICULAR FEDERAL AS WELL AS STATE AND LOCAL INCOME AND ANY OTHER
TAX ADVICE.
Stock options. The grant of an incentive stock option or a non-qualified
stock option would not result in income for the grantee or in the deduction for
the Company.
The exercise of a non-qualified stock option would result in ordinary
income for the optionee and a deduction for the Company measured by the
difference between the option price and the fair market value of the shares
received at the time of exercise.
The exercise of an incentive stock option would not result in income for
the grantee if the grantee (i) does not dispose of the shares within two years
after the date of grant or one year after the transfer of shares upon exercise
and (ii) is an employee of the Company or a subsidiary of the Company from the
date of grant until three months before the exercise date. If these requirements
are met, the basis of the shares upon later disposition would be the option
price. Any gain will be taxed to the employee as the long-term capital gain and
the Company would not be entitled to a deduction. The excess of the market value
on the exercise date over the option price is an item of tax preference,
potentially subject to the alternative minimum tax.
SARs. The grant of an SAR award would not result in income for the grantee
or in a deduction for the Company. Upon the exercise of an SAR, the grantee
would recognize ordinary
15
<PAGE>
income and the Company would be entitled to a deduction measured by the fair
market value of the shares plus any cash received.
Restricted Stock Grants. The grant of restricted stock should not result in
income for the grantee or in a deduction for the Company for federal income tax
purposes, assuming the shares transferred are subject to restrictions resulting
in a "substantial risk of forfeiture" as intended by the Company. If there are
no such restrictions, the grantee would recognize ordinary income upon receipt
of the shares. Dividends paid to the grantee while the stock remained subject to
restriction would be treated as compensation for federal income tax purposes. At
the time the restrictions lapse, the grantee would receive ordinary income, and
the Company would be entitled to a deduction measured by the fair market value
of the shares at the time of lapse.
Awards may be granted to participants under the Option Plan which do not
fall clearly into the categories described above. The federal income tax
treatment of these awards will depend upon the specific terms of such awards.
Generally, the Company will receive a deduction equal to, and will be required
to withhold applicable taxes with respect to, any ordinary income recognized by
a participant in connection with awards made under the Option Plan.
PROPOSAL TO RATIFY SELECTION OF AUDITOR
The Audit Committee has recommended, and the Board of Directors has
selected, the firm of Price Waterhouse LLP, independent certified public
accountants, to audit the financial statements of the Company for the fiscal
year ended June 30, 1997, subject to ratification by the shareholders. Price
Waterhouse has acted as independent auditor for the Company since fiscal 1995.
Representatives of Price Waterhouse LLP, which audited the Company's 1996
financial statements, are expected to be present at the Annual Meeting with the
opportunity to make a statement, if they so desire, and they are expected to be
available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS APPROVAL OF THIS PROPOSAL
CERTAIN RELATIONSHIPS AND OTHER TRANSACTIONS
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16 of the Securities Exchange Act of 1934, as amended, requires the
Company's directors and executive officers, and any person who owns more than
10% of a registered class of the Company's equity securities, to file with the
SEC and the Company, initial reports of ownership and reports of changes in
ownership of common stock and other equity securities of the Company. Based upon
the information supplied it by such persons, the Company is required to report
any known failure to file these reports within the period specified by the
instructions to the reporting forms. To the knowledge of the Company, based upon
a review of the Section 16(a) reports furnished to the Company and the written
representations of officers and directors, all these filing requirements were
satisfied by the Company's directors and executive officers.
SOLICITATION
The Company will bear the entire cost of solicitation of proxies including
preparation, assembly, printing and mailing of this Proxy Statement, the proxy
and any additional information furnished to stockholders. Copies of solicitation
materials will be furnished to banks, brokerage houses, fiduciaries and
custodians holding in their names shares of common stock beneficially owned by
others to forward to such beneficial owners. The Company may reimburse persons
representing beneficial owners of common stock for their costs of forwarding
solicitation materials to such beneficial owners. Original solicitation of
proxies by mail may be supplemented by telephone, telegram, facsimile or
personal solicitation by directors, officers or other regular
16
<PAGE>
employees of the Company. No additional compensation will be paid to directors,
officers or other regular employees for such services.
STOCKHOLDER PROPOSALS
Proposals of stockholders that are intended to be presented at the
Company's 1997 annual meeting of stockholders must be received by the Company
not later than June 30, 1997 in order to be included in the Proxy Statement and
proxy relating to that annual meeting. Pursuant to the Company's By-laws, any
record stockholder who desires to submit a proposal for the approval of the
stockholders of the Company must deliver written notice to the Secretary of the
Company no later than the close of business 60 days in advance of the Annual
Meeting or 10 days after the date on which notice of the Annual Meeting is
given, whichever is later.
STOCKHOLDER NOMINATION OF DIRECTORS
Nominations other than those made by the directors of the Company must be
in writing and be delivered to the Secretary of the Company not less than ten
days after the date on which notice of the annual meeting is first given to the
stockholders, or more than 60 days prior to any annual meeting, whichever is
later. Such nominations must include the information regarding the person
advancing the nomination as well as information about the nominee as required by
the By-laws of the Company. Nominations not made according to these procedures
will be disregarded.
OTHER MATTERS
The Board of Directors knows of no other matters that will be presented for
consideration at the Annual Meeting. If any other matters are properly brought
before this meeting, it is the intention of the persons named in the
accompanying proxy to vote on such matters in accordance with their best
judgment.
By Order of the Board of Directors
Reed L. Benson
Secretary and General Counsel
Jackson, Wyoming
October 4, 1996
17
