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 Section 240.14a-11(c) or Section 240.14a-12
CONCEPTS DIRECT, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
(X) No fee required
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
CONCEPTS DIRECT, INC.
1351 S. Sunset Street
Longmont, Colorado 80501
-------------------
Notice of Annual Meeting of Shareholders
To Be Held on April 19, 1997
-------------------
TO THE SHAREHOLDERS OF CONCEPTS DIRECT, INC.:
The Annual Meeting of Shareholders of Concepts Direct, Inc. (the
"Company") will be held at the Raintree Plaza Hotel, 1900 Ken Pratt Boulevard,
Longmont, Colorado 80501, on April 19, 1997, at 9:00 A.M., local time, for the
following purposes:
1. To elect five directors for the ensuing year;
2. To ratify the appointment of Ernst & Young LLP as the independent
public accountants for the Company for the fiscal year ending
December 31, 1997; and
3. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The close of business on February 18, 1997, has been fixed as the record
date for the Annual Meeting. All shareholders of record as of that date are
entitled to notice of and to vote at the meeting and any adjournment thereof.
A copy of the Company's Annual Report to Shareholders for the fiscal
year ended December 31, 1996, is included with this proxy statement.
By Order of the Board of
Directors
H. Franklin Marcus, Jr.
Secretary
March 6, 1997
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY. YOU MAY WITHDRAW THIS PROXY AT
ANY TIME BEFORE YOUR SHARES ARE ACTUALLY VOTED AND MAY VOTE YOUR OWN SHARES IF
YOU ATTEND THE MEETING IN PERSON.
<PAGE>
CONCEPTS DIRECT, INC.
1351 S. Sunset Street
Longmont, Colorado 80501
PROXY STATEMENT
TO BE MAILED ON OR ABOUT MARCH 7, 1997
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 19, 1997
The enclosed proxy is solicited by and on behalf of the Board of
Directors of Concepts Direct, Inc. (the "Company"), for use at the Annual
Meeting of Shareholders of the Company to be held April 19, 1997, or any
adjournments thereof, for the purposes set forth in this Proxy Statement and the
attached Notice of Annual Meeting of Shareholders. If sufficient proxies are not
returned in response to this solicitation, supplementary solicitations may be
made by mail or by telephone, telegraph, electronic means or personal interview
by directors, officers, and regular employees of the Company, none of whom will
receive additional compensation for these services. Costs of solicitation of
proxies will be borne by the Company, which will reimburse banks, brokerage
firms, and other custodians, nominees, and fiduciaries for reasonable
out-of-pocket expenses incurred by them in forwarding proxy materials to the
beneficial owners of stock held by them. The Company has also retained Corporate
Investor Communications, Inc., of Carlstadt, New Jersey, to assist in the
solicitation of proxies of shareholders whose shares are held in street name by
brokers, banks and other institutions at an approximate cost of $1,000 plus
out-of-pocket expenses. Such solicitation will be made by mail or by telephone,
telegraph, electronic means or personal interview. These costs will also be
borne by the Company.
The shares represented by all properly executed proxies received by the
Secretary of the Company and not revoked will be voted for the election of the
directors nominated and for the ratification of Ernst & Young LLP as independent
public accountants for the Company for the fiscal year ending December 31, 1997,
unless the shareholder directs otherwise in the proxy, in which event such
shares will be voted in accordance with such directions. Any proxy may be
revoked at any time before the shares to which it relates are voted either by
giving written notice (which may be in the form of a substitute proxy delivered
to the secretary of the meeting) or by attending the meeting and voting in
person.
In accordance with applicable law, all the shareholders of record on the
record date are entitled to receive notice of, and to vote at, the Annual
Meeting. On the record date there were issued and outstanding 2,125,441 shares
of the Company's common stock, $.10 par value (the "Common Stock"). All of such
shares were of one class, with equal voting rights, and each holder thereof is
entitled to one vote on all matters voted on at the Annual Meeting for each
share registered in such holder's name. Presence in person or by proxy of
holders of 1,062,721 shares of Common Stock will constitute a quorum at the
Annual Meeting. Shares for which the holder has elected to abstain or to
withhold the proxies' authority to vote on a matter will count toward a quorum.
Assuming a quorum is present, the affirmative
Page 1 of 13
<PAGE>
vote by the holders of a plurality of the shares represented at the Annual
Meeting and entitled to vote will be required to act on the election of
directors and the affirmative vote by the holders of a majority of the shares
represented at the Annual Meeting and entitled to vote will be required to act
on all other matters to come before the Annual Meeting, including the
ratification of the selection of Ernst & Young LLP as independent auditors for
the current fiscal year. Abstentions and broker non-votes are counted for
purposes of determining the presence or absence of a quorum for the transaction
of business. Abstentions are counted in tabulations of the votes cast on
proposals presented to stockholders, whereas broker nonvotes are not counted for
purposes of determining whether a proposal has been approved.
RECENT DEVELOPMENTS
On February 25, 1997, the Board of Directors declared a 2-for-1 split of
the Common Stock (the "Stock-split"). Stockholders of record at the close of
business on March 14, 1997 will be entitled to participate in the Stock-split,
which will be effected in the form of a 100% stock dividend payable on March 31,
1997. Because the record date for the Annual Meeting was February 18, 1997, the
Stock-split will not change the number of shares entitled to vote at the Annual
Meeting. Each holder of record of Common Stock on the record date will be
entitled to one vote for each share then registered in the holder's name.
Consistent with the manner in which the votes will be counted for the Annual
Meeting, none of the share amounts reported in this Proxy Statement have been
adjusted to reflect the Stock-split.
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
Record Date
The Board of Directors has fixed the close of business on February 18,
1997, as the record date for the determination of shareholders entitled to
notice of and to vote at the Annual Meeting and any adjournment thereof. Each
holder of record of Common Stock on the record date will be entitled to one vote
for each share then registered in the holder's name. As of the close of business
on the record date, 2,125,441 shares were outstanding and entitled to vote at
the Annual Meeting.
Stock Ownership of Certain Beneficial Owners and Management
The table below sets forth information regarding beneficial ownership as
of February 18, 1997 of Common Stock by the Company's directors individually,
the executive officers named in the Summary Compensation Table individually, the
Company's directors and executive officers as a group, and persons known to the
Company to be beneficial owners of more than 5% of the Common Stock.
Page 2 of 13
<PAGE>
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership(1)(2) of Class
<S> <C>
Executive Officers and Directors
Phillip A. Wiland 757,734(3) 35.49
1351 S. Sunset
Longmont, CO 80501
Michael T. Buoncristiano 39,449 1.84
450 7th Street, Suite LL8
Hoboken, NJ 07030
Robert L. Burrus, Jr. 4,334 *
One James Center
Richmond, VA 23219
H. Franklin Marcus, Jr. 42,598 2.00
1351 S. Sunset
Longmont, CO 80501
Phillip D. White 64,333 3.01
200 Camden Place
Boulder, CO 80302
J. Michael Wolfe 94,264 4.41
1351 S. Sunset
Longmont, CO 80501
Stephen R. Polk 4,333(4) *
1155 Brewery Park Boulevard
Detroit, MI 48207
All Directors and Executive Officers 1,007,045 47.17
as a Group (7 Persons)
5% Owners
Laifer Capital Management, Inc. 373,000(5) 17.47
114 West 47th Street
New York, NY 10036
R. L. Polk & Co. 421,800(4) 19.76
1155 Brewery Park Boulevard
Detroit, MI 48207
- ----------------
</TABLE>
* Does not exceed 1% of the outstanding shares of the Company
Page 3 of 13
<PAGE>
(1) The amount of shares beneficially owned has not been adjusted to
reflect the Stock-split. See "Recent Developments."
(2) Except as described in footnotes (3), (4) and (5) below, each
individual has sole voting power and sole investment power with respect to the
Common Stock set forth opposite his name. Includes, as to Mr. White 2,333, as to
Messrs. Buoncristiano and Burrus 2,667 shares, as to Messrs. Marcus and Wiland
1,000 shares and as to Mr. Wolfe 2,000 shares of Common Stock, which could be
acquired through exercise of stock options within 60 days.
(3) Includes 748,984 shares owned in joint tenancy by Mr. Wiland and his
wife, who share voting and investment power as to the shares, 6,450 shares held
by Mr. Wiland as custodian for his minor children under the Uniform Gifts to
Minors Act and for which Mr. Wiland has sole voting and investment power and
2,300 shares owned by Mr. Wiland's daughter and for which Mr. Wiland shares
voting and investment power.
(4) Stephen R. Polk, a Director of the Company, is Chairman of the Board
and Chief Executive Officer of R.L. Polk & Co., and may by virtue of these
positions be deemed to share voting and investment power over shares owned by
R.L. Polk & Co. Mr. Polk disclaims any such shared control of shares owned by
R.L. Polk & Co.
(5) Ownership information is based on the Schedule 13D filed on January
27, 1997. According to this Schedule 13D, Laifer Capital Management, Inc. holds
261,100 shares with sole voting and dispositive power and 111,900 shares with
shared dispositive power.
Page 4 of 13
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS
Action will be taken at the Annual Meeting to elect a Board of Directors
of five members. Unless otherwise instructed on the proxy, the shares
represented by proxies will be voted for the election as directors of all of the
nominees named below. Each of the nominees has consented to being named as a
nominee and has agreed that, if elected, he will serve on the Board of Directors
for a term which will run until the next annual meeting of shareholders and
until his successor has been elected. If any nominee becomes unavailable for any
reason the shares represented by proxies may be voted for a substitute nominee
designated by the Board of Directors.
The following table sets forth certain information as to the nominees and
certain executive officers.
<TABLE>
<CAPTION>
Name, Age, Principal Occupation Director
and other information Since
<S> <C>
PHILLIP A. WILAND (50) 1992
Chairman and Chief Executive Officer of the
Company since 1992. President and
Chief Executive Officer of Wiland
Services, Inc. from 1971 to 1992.
MICHAEL T. BUONCRISTIANO (55) 1992
President, AVANTI! Direct Marketing Services,
Inc. since 1990.
ROBERT L. BURRUS, JR. (62) 1992
Chairman, Law Firm of McGuire, Woods, Battle &
Boothe, L.L.P., Richmond, Virginia, since 1990.
Director, CSX Corporation, Heilig-Meyers
Company, O'Sullivan Corporation, S&K Famous
Brands, Inc. and Smithfield Foods, Inc.
STEPHEN R. POLK (41) 1992
Chairman of the Board and Chief Executive Officer, R.L.
Polk & Co. since 1994. Previous employment with R.L.
Polk & Co. includes position as President, 1990 to 1994.
R.L. Polk & Co. owns approximately 20% of the
Common Stock, and as such may be deemed an affiliate
of the Company.
</TABLE>
Page 5 of 13
<PAGE>
<TABLE>
<CAPTION>
Name, Age, Principal Occupation Director
and other information Since
<S> <C>
PHILLIP D. WHITE (50) 1992
Associate Professor and past Chairman of
Marketing, College of Business and Administration,
University of Colorado at Boulder since 1976 (on
leave). Lecturer and writer on marketing. Ph.D.
in Marketing, University of Texas, 1976. President,
Phillip D. White & Associates, Inc. since 1996.
</TABLE>
Nominations for Director
The Bylaws of the Company provide that the only persons who may be
nominated for Directors are (i) those persons nominated by the Company's Board
of Directors, (ii) those persons nominated by the Compensation and Nominations
Committee of the Company's Board of Directors and (iii) those persons whose
names were personally delivered to the Secretary of the Company not later than
the close of business on the tenth day following the mailing date of the
Company's Proxy Statement for an annual meeting or delivered to the Secretary of
the Company by United States mail, postage prepaid, postmarked no later than 10
days after the mailing date of the Proxy Statement for an annual meeting. Any
shareholder wishing to nominate a person other than those listed in this Proxy
Statement must submit the following information in writing to the Office of
Secretary, Concepts Direct, Inc., 1351 S. Sunset Street, Longmont, Colorado
80501: (i) the name and address of the shareholder who intends to make the
nomination; (ii) the name, address, and principal occupation of each proposed
nominee; (iii) a representation that the shareholder is entitled to vote at such
meeting and intends to appear in person or by proxy at the meeting to nominate
the person or persons specified in the notice; and (iv) the written consent of
each proposed nominee to serve as a director of the Company if so elected. The
Chairman of the meeting may refuse to acknowledge the nomination of any person
not made in compliance with the foregoing procedure.
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors held five meetings during 1996. Each incumbent
director attended 75% or more of the aggregate of (1) such meetings of the Board
of Directors and (2) the total number of meetings held by all committees of the
Board of Directors on which he served.
Committees of the Board
The standing committees of the Board of Directors include an Audit
Committee and a Compensation and Nominations Committee.
Messrs. Polk, White and Buoncristiano are the members of the Audit
Committee, which met four times in 1996. The principal function of the Audit
Committee is to oversee the performance of the Company's independent
accountants. In this capacity, the Audit Committee recommends the firm to be
engaged by the Company for independent auditing and reviews the overall scope
and results of the annual
Page 6 of 13
<PAGE>
audit. It also reviews, among other things, the functions and performance of the
Company's internal accounting controls, the performance of nonaudit services,
and changes in accounting policies.
Messrs. Burrus, Polk, White and Buoncristiano are the members of the
Compensation and Nominations Committee, which met two times in 1996. The
principal functions of the Compensation and Nominations Committee are to review
and set the direct and indirect compensation of the directors and officers of
the Company, to administer the Company's incentive compensation and stock option
plans and consider nominations for director made by shareholders of the Company.
The Committee reviews the salaries and bonuses for all officers and certain
other executives, recommends special benefits and perquisites for management,
and consults with management regarding employee benefits and general personnel
policies and recommends persons to be considered for election to the Board of
Directors, membership on committees of the Board of Directors, and positions as
executive officers of the Company. Recommendations by shareholders of persons to
serve on the Board of Directors should be submitted to the Compensation and
Nominations Committee in care of the Secretary of the Company in the manner
described under "Nominations for Director".
Compensation of Directors
The Company pays to each director who is not a Company employee an
annual retainer of $4,000 and $500 for each meeting of the Board of Directors or
any committee meeting of the Board of Directors attended. All directors are
reimbursed for travel expenses incurred as a result of service on the Board of
Directors.
Directors who are not employees of the Company also receive awards under
the 1992 NonEmployee Directors Stock Option Plan (the "1992 Plan"). Stock option
grants under the 1992 Plan are automatic. Each eligible director of the Company
on the effective date of the 1992 Plan, December 18, 1992, automatically
received an option to purchase 3,000 shares of Common Stock. Each eligible
director newly elected by the Company's shareholders on and after the effective
date of the Plan automatically receives options for 3,000 shares on the date the
director is elected by the shareholders. In addition, on the second anniversary
of the date on which an eligible director receives his or her initial grant of
an option, and biannually thereafter, each then eligible director will
automatically receive an option to acquire an additional 2,000 shares of Common
Stock. The maximum number of shares of Common Stock subject to the 1992 Plan is
40,000. The exercise price of the options granted under the 1992 Plan is the
fair market value of the Common Stock on the date of the option grant.
On December 18, 1996, the fourth anniversary date on which each eligible
director received his initial grant of options, four non-employee members of the
Board of Directors were granted an aggregate of 8,000 stock options at an option
price of $19.50 per share. During 1996, Mr. Buoncristiano exercised 3,667 stock
options and in early 1997, Mr. Polk exercised 4,333 stock options.
Page 7 of 13
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth, for the years ended December 31, 1994,
December 31, 1995, and December 31, 1996, certain compensation awarded to,
earned by, or paid to the Company's Chief Executive Officer and to the Company's
other executive officer whose annual compensation exceeded $100,000 for the year
ended December 31, 1996.
<TABLE>
<CAPTION>
Long Term
Compen-
Annual Compensation sation
Awards
- --------------------------------------------------------------------------------------------------------
Securities
Other Underlying All Other
Annual Options Compen-
Name and Principal Salary Bonus Compen- /SARs sation
Position Year ($) ($) sation (#) ($)(1)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Phillip A. Wiland, 1996 167,390 57,025 (2) 0 3,939
Chairman and Chief 1995 133,424 31,860 (2) 0 3,403
Executive Officer 1994 107,804 36,389 (2) 8,000 2,283
J. Michael Wolfe, 1996 150,690 51,054 (2) 0 2,709
President and Chief Operating 1995 131,597 30,654 (2) 0 1,427
Officer 1994 100,323 35,543 (2) 8,000 1,454
H. Franklin Marcus, Jr. 1996 86,010 29,316 (2) 0 2,173
Chief Financial Officer and 1995 78,689 18,314 (2) 0 2,147
Secretary, Treasurer 1994 61,680 22,346 (2) 4,000 1,554
================================ =========== ============= ============ =============== ================== ==================
</TABLE>
(1) These amounts were paid by the Company as matching contributions
under the Company's Retirement Savings Plan.
(2) None of the named executive officers received Other Annual
Compensation in excess of the lesser of $50,000 or 10% of combined salary and
bonus for fiscal 1994, 1995 or 1996.
Page 8 of 13
<PAGE>
Options/SAR Exercises and Year-End Value Table
The following table sets forth information concerning each exercise of
stock options and SARs during the fiscal year ended December 31, 1996, for each
of the executive officers named in the Summary Compensation Table and the fiscal
year-end value of unexercised options and SARs.
<TABLE>
<CAPTION>
Aggregated Option/SAR Exercises in Last Fiscal Year, and FY-End Option/SAR Values
- ---------------------------------------------------------------------------------------------------------------------------------
Number of Securities Value of
Underlying Unexercised Unexercised In-the-Money
Options/SARs at Options/SARs at
12/31/96(1) (#) 12/31/96(2) ($)
---------------------------------- ---------------------------------
Share Value
Acquired on Realized
Name Exercise(#) ($) Exercisable Unexercisable Exercisable Unexercisable
- --------------------------- ---------------- ------------- --------------- ----------------- --------------- -----------------
<S> <C>
Phillip A. Wiland 0 0 1,000 15,000 18,345 254,775
J. Michael Wolfe 0 0 2,000 22,000 36,690 383,810
H. Franklin Marcus, Jr. 0 0 1,000 11,000 18,345 191,905
=========================== ================ ============= =============== ================= =============== =================
</TABLE>
(1) The number of securities underlying unexercised options has not been
adjusted to reflect the Stock-split. See "Recent Developments."
(2) The value calculation is based on the market value of the underlying
stock at year end, minus the exercise price.
Compensation Committee Interlocks and Insider Participation
Mr. Burrus, a member of the Compensation and Nominations Committee, is
Chairman and partner of the law firm of McGuire, Woods, Battle & Boothe, L.L.P.,
which was retained as general counsel by the Company during the fiscal year
ended December 31, 1996, and has been so retained during the current fiscal
year.
REPORT OF THE COMPENSATION AND NOMINATIONS COMMITTEE
General. During the calendar year ended December 31, 1996, the
Compensation and Nominations Committee of the Board of Directors (the
"Committee") was comprised of four non-employee directors, Messrs. Michael T.
Buoncristiano, Robert L. Burrus, Jr., Stephen R. Polk, and Phillip D. White.
The Committee is responsible for setting compensation levels for the Company's
executive officers and for overseeing the administration of the Concepts Direct,
Inc. 1996 Incentive Compensation Plan (the "Incentive Compensation Plan") and
the Concepts Direct, Inc. 1992 Employee Stock Option Plan (the "Stock Option
Plan").
Page 9 of 13
<PAGE>
All decisions by the Committee are reviewed by the entire Board of
Directors. It has been the practice of the Committee to meet with the Company's
Chief Executive Officer ("CEO") in reviewing the compensation of senior
officers.
The compensation of the Company's senior executives is generally made up
of three components. These components include base salary, performance bonuses
under the Incentive Compensation Plan, and stock options granted under the Stock
Option Plan. At the Committee's discretion, an executive's compensation may also
include an award of stock appreciation rights under the Stock Option Plan. No
stock appreciation rights were awarded by the Committee during 1996.
An executive officer's base salary is a function of the executive
officer's responsibilities. The Committee believes that the compensation of
executive officers should be closely aligned with the performance of the Company
on both a short-term and long-term basis.
Prior to the beginning of 1996, the Committee established the formula to
be used to determine performance bonuses during 1996. The Committee determined
the amount of the performance bonus awarded to each executive officer who is
eligible for such an award as a percentage of such executive officer's base
salary. Quarterly and annual bonuses are paid under the Incentive Compensation
Plan based on the performance of the Company using a variety of measures
including net profit, earnings per share, revenues, and market capitalization.
The Committee's decisions were incorporated into the Incentive Compensation Plan
which was approved by the Board. Each calendar quarter, executive officers are
eligible to receive performance bonuses under the Incentive Compensation Plan.
The Committee believes that an executive officer should have an opportunity to
receive a performance bonus based on his or her performance during the
applicable quarter.
The long-term performance based compensation of executive officers takes
the form of stock option awards under the Stock Option Plan. The Committee
believes that compensation in the form of equity in the Company ensures that the
executive officers will have a continuing stake in the long-term success of the
Company and help further the alignment of their interests with those of the
shareholders. All options granted under the Stock Option Plan have an exercise
price equal to the market price of the Company's Common Stock on the date of the
grant. Thus, the stock options granted to an executive officer will have value
only if the Company's stock price increases.
In granting options under the Stock Option Plan, the Committee takes
into account each executive officer's responsibilities, relative position in the
Company and past grants. The Committee does not follow an established formula in
awarding stock options. Factors considered in making option awards to the
Company's officers and employees include past grants, the importance of
retaining the officer or employee, and the potential of the officer or employee
to contribute to the future success of the Company.
The compensation currently paid by the Company is not subject to
Internal Revenue Code Section 162(m) which limits the income tax deductibility
of certain forms of compensation paid to its named executive officers in excess
of $1 million per year. Section 162(m) allows full deductibility of certain
types of performance-based compensation. If these limitations should become
applicable to the Company
Page 10 of 13
<PAGE>
in the future, the Committee will consider modifications to the Company's
compensation practices, to the extent practicable, to provide the maximum
deductibility for compensation payments.
Compensation for Mr. Phillip A. Wiland, Chairman and Chief Executive
Officer. The base salary for Mr. Wiland during the 1996 calendar year was
$168,000. Mr. Wiland's salary was recommended to the Board of Directors by the
Committee following consultation with Mr. Wiland. The Committee reviewed CEO
performance in relation to the Company's goals in formulating its salary
recommendation for Mr. Wiland. Mr. Wiland's salary for 1996 was recommended and
approved by the Board of Directors. Mr. Wiland does not have an Employment
Agreement with the Company.
It is the Committee's view that Mr. Wiland's base salary of $168,000 and
bonus opportunity are in line with the compensation paid to the CEOs of other
corporations, including direct marketing businesses of similar size. The
Committee reviewed compensation information for certain competitors and
companies in the same geographic area as the Company's headquarters. These
companies are not the same as the companies in the indexes used for the
Performance Graph following this report. Bonuses were paid to Mr. Wiland under
the Incentive Compensation Plan. No stock options were granted to Mr.
Wiland under the Stock Option Plan during 1996.
Compensation and Nominations Committee
Phillip D. White, Chairman
Michael T. Buoncristiano
Robert L. Burrus, Jr.
Stephen R. Polk
<PAGE>
PERFORMANCE GRAPH
The following graph represents the cumulative total return on the
Company's Common Stock, with the cumulative total return of the companies
included in the Standard & Poor's Specialty Retail Index and the Standard &
Poor's 500 Index for the last five fiscal years. Cumulative total shareholder
return is defined as share price appreciation assuming reinvestment of
dividends. The dollar amounts shown on the following graph assume that $100 was
invested on October 1, 1992 in Company Common Stock, stocks constituting the
Standard & Poor's Specialty Retail Index and stocks constituting the Standard
and Poor's 500 Index with all dividends being reinvested.
Comparison of Five-Year Total Return
Among Concepts Direct, Inc., S&P Specialty Retail Index and
S&P 500 Index
[GRAPH]
Page 11 of 13
<PAGE>
<TABLE>
<CAPTION>
Value of $100 invested on October 1, 1992
Fiscal Year 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96
- ----------- -------- -------- -------- -------- --------
<S> <C>
Concepts Direct, Inc. $275 $163 $1,000 $2,650 $4,100
S&P Specialty Retail - 500 101 100 76 57 81
S&P 500 Index 105 116 117 161 198
</TABLE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On May 20, 1993, Mr. Wolfe, an executive officer of the Company, offered
to purchase 80,000 shares of Common Stock from the Company at the price of
$1.125 per share. Mr. Wolfe made a down payment of $27,000 on the purchase and
financed the remaining $63,000 by delivering to the Company a non-recourse
installment note accruing interest at a rate of 5.5% per annum. The note
contains provisions that payment of interest will occur on a quarterly basis and
that the principal be paid in four annual installments, each equal to 10% of the
principal amount, commencing on May 1, 1994, and a balloon payment of the
remaining balance on May 1, 1998. Mr. Wolfe pledged the entire 80,000 shares of
Common Stock to the Company as collateral for the loan. Mr. Wolfe paid off the
loan in 1996.
PROPOSAL NO. 2
SELECTION OF PRINCIPAL ACCOUNTANT
Ernst & Young LLP served during the Company's year ended December 31,
1996, as its independent certified public accountants and has been selected by
the Board of Directors to serve as the Company's independent certified public
accountants for the current fiscal year, subject to ratification by the
shareholders of the Company. The Board of Directors expects that representatives
of Ernst & Young LLP will be present at the Annual Meeting of Shareholders, with
the opportunity to make a statement if they so desire, and will be available to
respond to appropriate questions.
OTHER MATTERS
The Board of Directors knows of no other matters to be brought before
the meeting. If any other matters are properly presented, however, or if any
question arises as to whether any matter has been properly presented and is a
proper subject for shareholder action, the persons named as proxies in the
accompanying proxy intend to vote the shares represented by such proxy in
accordance with their best judgment.
Page 12 of 13
<PAGE>
SHAREHOLDER PROPOSALS
The shareholders may present proposals for consideration at the 1997
Annual Meeting of Shareholders to the Company for inclusion in its proxy
materials for such meeting. Any such proposal should be submitted in writing in
accordance with Securities and Exchange Commission rules to Concepts Direct,
Inc., 1351 S. Sunset Street, Longmont, Colorado 80501, Attention: Corporate
Secretary. Shareholder proposals must be received by November 6, 1997, to be
included in the proxy materials for the 1997 Annual Meeting.
FURTHER INFORMATION
The Company will provide without charge to each person from whom a proxy
is solicited by the Board of Directors, upon the written request of any such
person, a copy of the Company's annual report on Form 10-K, including the
financial statements and schedules thereto, required to be filed with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934 for the Company's fiscal year ended December 31, 1996. Such written request
should be sent to Concepts Direct, Inc., 1351 S. Sunset Street, Longmont,
Colorado 80501, Attention:
Corporate Secretary.
By Order of the Board of Directors
H. FRANKLIN MARCUS, JR.
Secretary
March 6, 1997
Page 13 of 13
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PROXY CONCEPTS DIRECT, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS TO BE HELD APRIL 19, 1997
The undersigned having received the Annual Report to the Shareholders and
the accompanying Notice of Annual Meeting of Shareholders and Proxy Statement
dated March 6, 1997, hereby appoints H. Franklin Marcus, Jr., and Robert L.
Burrus, Jr. (each with power to act alone and with power of substitution) as
proxies and hereby authorizes them to represent and vote, as directed below, all
the shares of common stock of Concepts Direct, Inc., held of record by the
undersigned on February 18, 1997, at the annual meeting of stockholders to be
held on April 19, 1997, and any adjournment thereof.
<TABLE>
<S> <C>
1. ELECTION OF DIRECTORS [ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote for all nominees
(except as indicated below) listed below
</TABLE>
Robert L. Burrus, Jr., Michael T. Buoncristiano, Stephen R. Polk, Phillip D.
White, Phillip A. Wiland
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THE NOMINEE'S NAME ON THE LINE PROVIDED BELOW.)
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2. RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS INDEPENDENT ACCOUNTANTS
FOR THE YEAR 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
<PAGE>
3. IN THEIR DISCRETION the proxies are authorized to vote such other business as
may properly come before the meeting and any adjournments thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED. WHERE NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED "FOR" PROPOSALS 1 AND 2.
Any proxy or proxies previously given for the meeting are revoked.
Please sign your name(s)
exactly as shown below. If
signer is a corporation,
please sign the full corporate
name by duly authorized
officer. If an attorney,
guardian, administrator,
executor, or trustee, please
give full title as such. If a
partnership, please sign in
partnership name by authorized
person.
Dated: _________________, 1997
______________________________
______________________________
Please complete, date, sign,
and return this
proxy promptly in the
enclosed envelope.
