<PAGE> 1
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
CITATION COMPUTER SYSTEMS, INC.
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(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
NOTICE OF THE 1996 ANNUAL MEETING OF SHAREHOLDERS
AND PROXY STATEMENT OF
CITATION COMPUTER SYSTEMS, INC.
<PAGE> 3
CITATION COMPUTER SYSTEMS, INC.
424 SOUTH WOODS MILL ROAD
SUITE 200
CHESTERFIELD, MISSOURI 63017
July 16, 1996
To the Shareholders of CITATION Computer Systems, Inc.:
You are cordially invited to attend the CITATION Computer Systems, Inc.
1996 Annual Meeting of Shareholders, to be held on Thursday, August 15, 1996.
The meeting will begin promptly at 10:00 a.m. at 8000 Forsyth Boulevard, 15th
Floor, Clayton (St. Louis County), Missouri.
The matters to be acted on at the meeting are described in detail in the
attached official Notice of the Annual Meeting of Shareholders and Proxy
Statement. Company officers will present reports and shareholders will have an
opportunity to ask questions of general interest. Also enclosed is a copy of
CITATION's Annual Report to Shareholders for the fiscal year ended March 31,
1996.
THE VOTE OF EVERY SHAREHOLDER IS IMPORTANT. Your prompt cooperation in
signing and returning your Proxy immediately will be greatly appreciated, and
may save additional solicitation expenses. Please note that returning your
completed Proxy will not prevent you from voting in person at the meeting if
you wish to do so. You may use the enclosed self-addressed stamped envelope to
return your Proxy.
Sincerely,
[sig to come]
J. Robert Copper
Chairman and Chief
Executive Officer
<PAGE> 4
CITATION COMPUTER SYSTEMS, INC.
NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS
July 16, 1996
To the Shareholders of CITATION Computer Systems, Inc.
Notice is hereby given that the Annual Meeting of Shareholders of
CITATION Computer Systems, Inc., a Missouri corporation, will be held on
THURSDAY, AUGUST 15, 1996, AT 10:00 A.M., at 8000 Forsyth Boulevard, 15th Floor,
Clayton (St. Louis County), Missouri.
Pursuant to the Company's By-Laws, the Board of Directors has fixed the
close of business on June 24, 1996 as the record date for determining the
shareholders of the Company entitled to receive notice of and to vote at the
Annual Meeting of Shareholders. The following items, described in the attached
Proxy Statement, will be on the agenda:
1. To elect two persons as Class 1 Directors, each to serve a
three-year term expiring at the Annual Meeting of Shareholders to be
held in 1999;
2. To ratify the appointment of Price Waterhouse as independent
auditors for the Company; and
3. To transact such other business as may properly come before the
meeting.
So far as management is aware, no business is expected to come before the
Annual Meeting of Shareholders other than the matters described as items 1 and 2
above.
By order of the Board of Directors
[sig to come]
J. Robert Copper
Chairman and Chief Executive Officer
WE NEED YOUR PROXY VOTE IMMEDIATELY.
A SHAREHOLDER MAY THINK HIS OR HER VOTE IS NOT IMPORTANT, BUT IT IS VITAL. BY
LAW, THE ANNUAL MEETING OF SHAREHOLDERS OF CITATION COMPUTER SYSTEMS, INC.,
SCHEDULED FOR AUGUST 15, 1996, WILL HAVE TO BE ADJOURNED WITHOUT CONDUCTING ANY
BUSINESS IF LESS THAN A MAJORITY OF THE SHARES ELIGIBLE TO VOTE ARE REPRESENTED.
IN THAT EVENT, THE COMPANY, AT SHAREHOLDER EXPENSE, WOULD CONTINUE TO SOLICIT
VOTES IN AN ATTEMPT TO ACHIEVE A QUORUM. CLEARLY YOUR VOTE COULD BE CRITICAL TO
ENABLE THE COMPANY TO HOLD THE MEETING AS SCHEDULED, SO PLEASE RETURN YOUR PROXY
IMMEDIATELY.
<PAGE> 5
CITATION COMPUTER SYSTEMS, INC.
PROXY STATEMENT
July 16, 1996
This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of CITATION Computer Systems, Inc.
("CITATION" or "the Company") for the Annual Meeting of Shareholders that is
scheduled to be held on August 15, 1996, and any adjournments thereof (the
"Annual Meeting"). Only shareholders of record of common stock (the only class
of stock of the Company issued and outstanding) at the close of business on June
24, 1996 (the "Record Date"), are entitled to notice of and to vote at this
meeting. As of the close of business on June 24, 1996, there were 3,756,936
shares of common stock issued and outstanding and entitled to vote. Shareholders
are not entitled to vote cumulatively for the election of directors. Each
shareholder is entitled to a number of votes for the election of directors equal
to the number of shares held by such shareholder multiplied by the number of
directors to be elected, but may cast no more votes for any one nominee than is
equal to the number of shares held by the Shareholder. On all other matters, the
shareholders are entitled to one vote per share. Proxies for shares marked
"abstain" and broker non-votes will be considered represented at the meeting but
not voted; shares held in "street name" by brokers and others for which Proxies
are voted on some but not all matters will be considered represented at the
meeting but voted only as to those matters actually marked on the Proxy if so
indicated.
If you sign and return the enclosed Proxy, the shares represented thereby
will be voted FOR the two nominees for director positions listed under the
heading "Nominees for Class 1 Directors" and FOR the proposal to ratify the
appointment of Price Waterhouse as independent auditors of the Company, unless
otherwise indicated on the Proxy. Although it is not anticipated that any
nominee will not serve as a Director, or be unable to serve as a Director, if
elected, in either such event the proxies will be voted for such other person or
persons as may be designated by the Board of Directors. Returning your completed
Proxy will not prevent you from voting in person at the meeting should you be
present and wish to do so. Proxies may be revoked by sending written notice of
revocation to the Secretary of the Company, or by signing and delivering a later
dated proxy, or, if you attend the Annual Meeting in person, by voting at the
Annual Meeting. Merely attending the Annual Meeting will not constitute
revocation of your Proxy. You may revoke your Proxy at any time before it is
voted.
Directors, officers and other employees of the Company may solicit
proxies by personal interview, telephone, facsimile transmission, and telegram
in addition to the use of the mails. CITATION will request persons, such as
brokers, nominees, and fiduciaries, holding stock in their name for others, or
holding stock for others who have the right to give voting instructions, to
forward proxy materials to their principals and request authority for the
execution of the Proxy. CITATION will reimburse them for reasonable
out-of-pocket expenses in so doing. The total cost of soliciting proxies will be
borne by the Company.
The Company's principal corporate offices are located at 424 South Woods
Mill Road, Suite 200, Chesterfield, Missouri 63017. This Proxy Statement and the
enclosed form of Proxy were first mailed to shareholders on or about July 16,
1996.
Page 1
<PAGE> 6
I. ELECTION OF DIRECTORS
The Board of Directors consists of six persons. In accordance with the
Company's Articles of Incorporation and By-Laws, Directors are divided into
three classes, and the number of Directors in each class is to be as nearly
equal as possible. Thus, each of the three classes of directors is composed of
two persons. The term of office for a Director position is 3 years. Therefore
each year one class of directors is elected. Class 1 Directors will be elected
at the 1996 Annual Meeting of Shareholders.
The names of the nominees, as recommended by the Board of Directors, and
the names of the Directors whose terms will continue after the Annual Meeting,
are listed below. Shares represented by a properly executed Proxy in the
accompanying form will be voted for the two nominees listed below unless
otherwise directed. Should any nominee become unavailable for any reason before
the election, the Proxy will be voted for substitute nominee(s) to be selected
by the Board of Directors of the Company, unless authority to vote for all of
the nominees is withheld.
Set forth under the heading "Security Ownership of Management" is a table
setting forth the beneficial ownership of the Company's common stock by each
Director, certain executive officers, persons known to the Company to
beneficially own 5 percent or more of the Company's outstanding common stock,
and by all Directors and executive officers as a group. No family relationships
exist between any of the nominees, the other Directors, or any of the executive
officers of the Company.
NOMINEES FOR CLASS 1 DIRECTORS
The Board of Directors has nominated the following persons to be elected
as Class 1 Directors at the 1996 Annual Meeting of Shareholders:
FRED L. BROWN. 55. President and Chief Executive Officer, BJC Health System.
Mr. Brown has been a Director of the Company since February 1993. He has
been President and Chief Executive Officer of BJC Health System
headquartered in St. Louis, Missouri, since its creation in June 1993
(resulting from the merger of Christian Health Services with
Barnes-Jewish, Inc.). Mr. Brown was President and Chief Executive Officer
of Christian Health Services from January 1986 to February 1993.
WILLIAM H. J. SEABROOK. 62. Executive Vice President, Sales and Marketing of the
Company, Chairman of Datasystems Consultants Limited and I. T. Health Consulting
Limited.
Mr. Seabrook has been a Director of the Company since February 1993. In
1985 he became Chairman of Datasystems Consultants Limited and I. T.
Health Consulting Limited, each of which is a consulting company
headquartered in London, England specializing in health authorities and
small companies in the health care business. Since September 1991, Mr.
Seabrook has provided services to the Company in connection with its
international operations. In October 1995, Mr. Seabrook assumed
responsibility for the Company's sales and marketing operations with the
title of Executive Vice President, Sales and Marketing.
Page 2
<PAGE> 7
CONTINUING DIRECTORS
CLASS 2 DIRECTORS. The terms of the Class 2 Directors are scheduled to
expire at the 1997 Annual Meeting of Shareholders. The Class 2 Directors are:
FRANK L. POGGIO. 49. Consultant to CITATION Computer Systems, Inc.
Mr. Poggio has been a Director of the Company since it acquired Health
Micro Data Systems, Inc. ("HMDS") in December 1992 and was President of
the Company from January 1995 to July 1996. Prior to January 1995, Mr.
Poggio served as Executive Vice President, Operations of the Company. Mr.
Poggio was the founder of HMDS, and served as President of HMDS from 1980
to July 1996.
JAMES F. O'DONNELL. 49. Chairman, Capital For Business, Inc., CFB Venture Fund
I, Inc., and CFB Partners, Inc. (General Partner of CFB Venture Fund II, L.P.)
Mr. O'Donnell was elected as a Director of the Company in 1994. Mr.
O'Donnell has served since 1990 as Chairman of Capital For Business,
Inc., an investment manager of two federally licensed SBIC venture funds
and served as President of that company from 1987 to 1990. Mr. O'Donnell
is also Chairman of CFB Venture Fund I, Inc., which owns 632,312 share of
the Company's Common Stock.
CLASS 3 DIRECTORS. The terms of the Class 3 Directors are scheduled to
expire at the 1998 Annual Meeting of Shareholders. The Class 3 Directors are:
J. ROBERT COPPER. 56. Chairman and Chief Executive Officer, CITATION Computer
Systems, Inc.
Mr. Copper has been a Director of the Company since May 1992. Mr. Copper
was appointed Chairman and Chief Executive Officer of the Company in
January 1995. Prior to that time Mr. Copper was active as a partner in
Hales, Copper & Company, a management consulting firm, which he joined in
1992. From 1990 to 1992, Mr. Copper was President and Chief Executive
Officer of the PLC Group, a management consulting firm specializing in
mergers and acquisitions. From 1988 to 1990, Mr. Copper was President and
Chief Executive Officer of Pet, Incorporated, a packaged foods company.
Mr. Copper was Senior Vice President, Planning and Development, for IC
Industries (now Whitman Corp.) a conglomerate, from 1980 to 1988.
DAVID T. PIERONI. 51. President of The Farris Group
Mr. Pieroni has been a Director of the Company since August 1991. Mr.
Pieroni formed Pieroni Management Counselors, Inc., a management
consulting company, in 1990 and served as President from 1990 to 1991,
and again became active in its affairs in 1995. From 1991 to 1995 Mr.
Pieroni was President of Spencer & Spencer Systems, Inc. In 1995 Mr.
Pieroni joined The Farris Group and became President of the Farris Group
in 1996. From 1977 to 1990, Mr. Pieroni was a Partner at a predecessor of
Ernst & Young, working in their health care and management consulting
practice, culminating in his position as Associate Managing Director of
that firm's Great Lakes Consulting Group.
Page 3
<PAGE> 8
COMMITTEES
The Company has standing Audit and Compensation committees. Current
members of the Audit Committee are David T. Pieroni and James F. O'Donnell.
Current members of the Compensation Committee are James F. O'Donnell, Fred L.
Brown, and David T. Pieroni. There is no standing nominating committee. The
Board of Directors may nominate candidates for Director positions, and
Shareholders may nominate candidates for Director positions in the manner set
forth in the By-Laws of the Company.
BOARD AND COMMITTEE MEETINGS
All directors attended at least 75 percent of the aggregate of all Board
of Directors meetings and committee meetings (of which such directors were
members) during the fiscal year ended March 31, 1996, that were held during the
period he served on the Board and/or committee. There were 5 Board of Directors
meetings held during the fiscal year ended March 31, 1996.
COMPENSATION OF DIRECTORS
Each Director who is not employed by the Company receives a monthly fee
of $1,000 for serving as a Director of the Company, except that Mr. Seabrook has
agreed that he will not receive a director's fee so long as he is providing
services to the Company under an agreement between Datasystems Consultants
Limited and the Company. Non-employee Directors may elect to receive directors
fees in the form of common stock of the Company in lieu of cash.
RELATED PARTY TRANSACTIONS
The Company has entered into an agreement with Datasystems Consultants
Limited ("Datasystems"), a company owned by one of the Company's Directors,
William H. J. Seabrook. This agreement was revised in September 1995. Under the
agreement, as revised, Datasystems has agreed to provide to the Company the
services of Mr. Seabrook for 100 equivalent full-time days per year to serve as
the Company's Executive Vice President for Sales and Marketing for the United
States and the United Kingdom. The Company's Chairman is empowered to define the
scope of the services to be provided by Mr. Seabrook. The agreement also
provides that Mr. Seabrook will agree to serve on the Company's Board of
Directors if requested by the Company. The Company is required to pay
Datasystems L5,200 per month, (which approximates $8,005 per month based upon
reported currency exchange rates as of June 20, 1996) for those services, plus
certain taxes and expenses. The revised agreement provides that if certain goals
are met, the payments to Datasystems will be retroactively increased to L10,400
per month. The agreement may be terminated by either party upon six months prior
written notice.
STOCK OWNERSHIP AND TRADING REPORTS
To the Company's knowledge, based solely upon the Forms 3 (Initial
Statement of Beneficial Ownership of Securities), Forms 4 (Statement of Changes
in Beneficial Ownership), and Forms 5 (Annual Statement of Changes in Beneficial
Ownership) filed with the Company, no persons failed to file any such form in a
timely manner.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE DIRECTOR
NOMINEES AND PROXIES WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY OTHERWISE IN
THEIR PROXIES.
Page 4
<PAGE> 9
VOTE REQUIRED
The two nominees receiving the highest number of votes will be elected as
Class 1 Directors. Cumulative voting will not apply for this election.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The table below sets forth, as of March 31, 1996, the end of CITATION's
most recent fiscal year, the number and percentage of outstanding shares of
Common Stock beneficially owned by (i) each Director of the Company, (ii) each
of the executive officers named in the Summary Compensation Table, (iii) all
Directors and officers of the Company as a group, and (iv) each person known by
the Company to own beneficially more than 5 percent of its Common Stock. The
Company believes that each individual or entity named has sole investment and
voting power with respect to shares of Common Stock indicated as beneficially
owned, except as otherwise noted.
<TABLE>
<CAPTION>
Shares Beneficially
Owned(1)
----------------------
Name Number Percentage
- ------------------------------------------------------- --------- ----------
<S> <C> <C>
CFB Venture Fund I, Inc.(2, 3) 632,312 16.9%
Fred L. Brown 7,853 0.2%
Frank L. Poggio(3) 351,623 9.4%
J. Robert Copper(3) 290,211 7.5%
David T. Pieroni 2,050 0.1%
William H. J. Seabrook 8,703 0.2%
James F. O'Donnell(2, 3) 632,312 16.9%
William T. Wynn 40,265 1.1%
Kennedy Capital Management, Inc.(3) 341,800 9.1%
All Directors and Officers as a Group (11 Persons) 1,493,216 37.7%
</TABLE>
- ------------------------------
(1) Calculated pursuant to Rule 13d-3(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"). Under Rule 13d-3(d), shares not outstanding
which are subject to options, warrants, rights, or conversion privileges
exercisable within 60 days are deemed outstanding for the purpose of
calculating the number and percentage owned by such person, but not deemed
outstanding for the purpose of calculating the percentage owned by each
other person listed. None of the shares shown are known to be shares with
respect to which the listed beneficial owner has the right to acquire
beneficial ownership, as specified in Rule 13d-3(d)(1), except as follows:
all Directors and Officers as a group, 186,332 shares.
(2) Mr. O'Donnell is Chairman of CFB Venture Fund I, Inc. And is deemed to
beneficially own the shares held by CFB Venture Fund, I, Inc.
(3) The address for Capital For Business Venture Fund I, Inc. is 11 South
Meramec, Suite 800, Clayton, Missouri 63105. The address for Kennedy Capital
Management, Inc. is 425 North New Ballas, St. Louis, Missouri 63141. The
address for Messrs. Copper and Poggio is 424 South Woods Mill Road, St.
Louis, Missouri 63017.
Page 5
<PAGE> 10
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding the
compensation paid to J. Robert Copper (the Company's chief executive officer)
and the two most highly compensated executive officers of the Company whose
compensation (including annual salary and bonus) exceeded $100,000, for the
fiscal year ended March 31, 1996:
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
-----------------------------------------------
Awards Payouts
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
(b) (c) (d) (e) (f) (g) (h) (i)
(a)
- ---------------------------------------------------------------------------------------------------------------
Name and Restricted
Principal Other Annual Stock Options LTIP All Other
Position Year Salary Bonus($) Compensation Award(s) (Shares) Payouts Compensation(4)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
J. Robert Copper 1996 $149,333 -0- -0- -0- 100,000 -0- 1,407
Chairman and 1995 $30,492 -0- -0- -0- -0- -0- -0-
Chief Executive 1994 -0- -0- -0- -0- -0- -0- -0-
Officer
- ---------------------------------------------------------------------------------------------------------------
Frank L. Poggio 1996 $130,000 -0- -0- -0- -0- -0- $1,175
President 1995 $114,167 -0- -0- -0- -0- -0- $1,485
1994 $97,500 -0- -0- -0- -0- -0- $1,213
- ---------------------------------------------------------------------------------------------------------------
William T. Wynn 1996 $96,700 $38,863 (5) -0- -0- -0- -0- $1,970
Regional Vice 1995 $94,617 $31,880 (5) -0- -0- 12,000 -0- $2,399
President, Sales 1994 $80,528 $19,328 (5) -0- -0- 10,000 -0- $2,232
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
- ------------------------------
(4) Consists solely of contributions by the Company to the CITATION
Computer Systems, Inc. Retirement Savings Plan.
(5) The dollar amount reflects commission earned during each fiscal year
ended March 31.
The Company has entered into an employment agreement with J. Robert
Copper which provides for an initial term ending March 31, 1998. This agreement
also provides for annual compensation, bonuses, and various other benefits. The
agreement terminates automatically upon the death of Mr. Copper or upon the
occurrence of certain long-term disabilities. The agreement provides that he may
be terminated by the Company for cause (as defined in the agreement).
Furthermore, the Company may also terminate the agreement without cause by
giving at least 30 days prior written notice to Mr. Copper. The Company will
provide one-year severance benefits under the agreement if Mr. Copper is
terminated other than for cause. Mr. Copper may at any time voluntarily
terminate his employment agreement without cause by giving at least 30 days
prior written notice to the Company or, if the Company is in Actual Default (as
defined in the employment agreement), upon 10 days prior written notice to the
Company.
The Company had an employment agreement with Mr. Poggio that was similar
to that of Mr. Copper's. Mr. Poggio terminated his employment with the Company
as of July 15, 1996, and agreed to enter into a consulting arrangement with the
Company. As of the date of this Proxy Statement a definitive written agreement
has not been entered into with Mr. Poggio, but it is expected that an agreement
will be executed by the parties providing for Mr. Poggio to serve as a
consultant to the Company, providing specified services for one year, and that
Mr. Poggio will receive $75,000 for those services. Mr. Copper will be assuming
the additional title of President of the Company.
Page 6
<PAGE> 11
OPTION GRANTS IN LAST FISCAL YEAR
The Board of Directors adopted and shareholders approved the CITATION
Computer Systems, Inc. 1992 Employee Incentive Stock Option Plan (the "1992
Stock Option Plan") effective April 1, 1992. The 1992 Stock Option Plan was
amended in April 1993. Pursuant to this amendment a total of 348,347 shares of
Common Stock were reserved for issuance under the 1992 Stock Option Plan.
The following tables set forth, with respect to the chief executive
officer and the other executive officers named in the foregoing Summary
Compensation Table, certain information about option grants and exercises in the
last fiscal year. The Company has not granted any stock appreciation rights.
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
(c)
% of
Total
(b) Options
Number of Granted (d)
Securities to Exercise
Underlying Employees Price (e)
(a) Options in Fiscal (per Expiration
Name Granted Year share) Date
- -------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J. Robert Copper 100,000 48.4% $5.00 10/5/05
Frank L. Poggio -0- -0- N/A N/A
William T. Wynn -0- -0- N/A N/A
</TABLE>
Aggregate Option Exercises in Last Fiscal Year
and Fiscal Year End Option Values
<TABLE>
<CAPTION>
(e)
(d) Value of
Number of Unexercised
Unexercised In-the-Money
(b) Options at Options at
Shares Fiscal Year Fiscal Year
Acquired (c) End End
(a) on Value Exercisable/ Exercisable/
Name Exercise Realized Unexercisable Unexercisable
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J. Robert Copper -0- -0- 100,000/0 $1,387,500/0
Frank L. Poggio -0- -0- 0/0 0/0
William T. Wynn -0- -0- 36,332/0 $504,107/0
</TABLE>
Page 7
<PAGE> 12
II. RATIFICATION OF APPOINTMENT OF
INDEPENDENT AUDITORS
The Board of Directors has selected Price Waterhouse as independent
auditors to audit the financial statements of the Company for the fiscal year
ending March 31, 1997, subject to ratification by the shareholders. A
representative of Price Waterhouse is expected to be present at the meeting to
answer questions and make a statement if he desires to do so.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL AND PROXIES
WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY OTHERWISE IN THEIR PROXIES.
VOTE REQUIRED
The affirmative vote of a majority of the shares which are present or
represented by proxy at the Annual Meeting on this proposal is required for
approval. If the shareholders do not approve this proposal, the selection of
independent auditors will be reconsidered by the Board of Directors.
III. OTHER MATTERS
Management does not intend to bring any other matters before the meeting
and, at the date of this Proxy Statement, management is not informed of any
other matters that others may bring before the meeting. However, if any other
matters properly come before the meeting, it is the intention of the proxy
holders to vote such shares for which they hold proxies in accordance with their
judgment on such matters.
MISCELLANEOUS
Proposals of shareholders intended to be presented at the 1997 Annual
Meeting of Shareholders must be received by the Company no later than March 18,
1997, to be eligible for inclusion in the proxy materials for that meeting.
------------------------------
Page 8
<PAGE> 13
(Detach Proxy Form Here)
- -------------------------------------------------------------------------------
PROXY SOLICITED BY THE BOARD OF DIRECTORS
CITATION COMPUTER SYSTEMS, INC.
ANNUAL MEETING OF SHAREHOLDERS AUGUST 15, 1996
The undersigned hereby appoints JAMES F. O'DONNELL and DAVID T. PIERONI, and
each of them, proxies, with full power of substitution and revocation, to vote
the common shares of CITATION Computer Systems, Inc., which the undersigned is
entitled to vote at the Annual Meeting of Shareholders scheduled to occur on
August 15, 1996, and at any adjournment(s) thereof (the "Meeting"), with all the
powers the undersigned would possess if personally present, including authority
to vote on the matters stated below in the manner directed, upon any other
matter which may properly come before the Meeting in such manner as the proxies
may in their discretion determine, and the authority to substitute and vote for
another nominee as described in the accompanying Proxy Statement. The
undersigned hereby revokes any proxy previously given to vote such shares at the
Meeting or any adjournment thereof.
<TABLE>
<CAPTION>
<S><C>
1. Election of two directors to serve in Class 1 for a term of three years.
/ / FOR all nominees listed below (except / / WITHHOLD AUTHORITY to vote
as marked to the contrary below). for all nominees listed below.
</TABLE>
Nominees: FRED L. BROWN and WILLIAM H. J. SEABROOK
INSTRUCTION: To withhold authority to vote for any individual nominee, write
such nominee's name in the space provided below:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S><C>
2. Ratification of the appointment of Price Waterhouse as independent auditors for CITATION Computer
Systems, Inc.
</TABLE>
/ / FOR / / AGAINST / / ABSTAIN
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
<PAGE> 14
(Detach Proxy Form Here)
- --------------------------------------------------------------------------------
THE PROXIES ARE DIRECTED TO VOTE AS SPECIFIED ABOVE AND IN THEIR DISCRETION ON
ALL OTHER MATTERS COMING BEFORE THE MEETING. EXCEPT AS SPECIFIED TO THE CONTRARY
ABOVE, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR ALL NOMINEES
LISTED IN 1 ABOVE AND FOR THE RATIFICATION OF APPOINTMENT OF INDEPENDENT
AUDITORS IN 2 ABOVE.
PLEASE PROMPTLY MARK, SIGN, DATE AND RETURN THIS PROXY DATED , 1996
IN THE ENCLOSED ENVELOPE
---------------------------
Signature
---------------------------
Signature
Sign exactly as name
appears at left. Where
stock is issued in two or
more names, all should
sign. If signing as
attorney, administrator,
executor, trustee,
guardian, or other
fiduciary, give full title
as such. A corporation
should sign by authorized
officer and affix seal. If
this Proxy is executed by
two or more persons or
entities it shall pertain
to all shares of common
stock of the Company held
in the individual name of
each person or entity as
well as all shares of
common stock of the Company
held in joint name by any
two or more such persons or
entities.
