SCHEDULE 14A
(Rule 14a-101)
Information required in proxy statement
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.)
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2)
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.149-11(C) or Section 240.14a-12
Greg Manning Auctions, 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 appropriate box)
[x] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(j)(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 is determined):
(4) Proposed maximum 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>
GREG MANNING AUCTIONS, INC.
775 Passaic Avenue
West Caldwell, New Jersey 07006
October 27, 1999
To Our Shareholders:
You are cordially invited to attend the Annual Meeting of Shareholders of Greg
Manning Auctions, Inc., which will be held at the Radisson Hotel & Suites, 690
Route 46 East, Fairfield, New Jersey 07004 at 10:00 AM Eastern Standard Time on
Thursday, December 9, 1999.
The Notice of Annual Meeting and Proxy Statement covering the formal business to
be conducted at the Annual Meeting follow this letter.
We hope that you will attend the Annual Meeting in person. Whether or not you
plan to attend, please complete, sign, date and return the enclosed proxy
promptly in the accompanying reply envelope to assure that your shares are
represented at the meeting.
Sincerely,
MARTHA HUSICK
Secretary
<PAGE>
GREG MANNING AUCTIONS, INC.
775 Passaic Avenue
West Caldwell, New Jersey 07006
973-882-0004
NOTICE OF 1999 ANNUAL MEETING OF SHAREHOLDERS
- --------------------------------------------------------------------------------
The Annual Meeting of Shareholders of Greg Manning Auctions, Inc. (the
"Company") will be held at the Radisson Hotel & Suites, 690 Route 46 East,
Fairfield, New Jersey 07004 at 10:00 AM Eastern Standard Time on Thursday,
December 9, 1999 for the following purposes:
1. To elect two directors to serve for terms of three years and
until their respective successors have been duly elected and
qualified.
2. To ratify the appointment of Amper, Politziner & Mattia as the
Company's independent public accountants for the Company's fiscal
year ending June 30, 2000.
3. To approve the amendment to the Company's 1997 Stock Incentive
Plan (the "1997 Plan") to increase the number of shares available
for issuance under the 1997 Plan and the Company's 1993 Stock
Option Plan by 300,000, for an aggregate of 1,150,000 shares.
4. To transact such other business as may be properly brought before
the meeting and any adjournment or postponement thereof.
Shareholders of record at the close of business on October 25, 1999 are entitled
to notice of, and to vote at, the Annual Meeting and any adjournment or
postponement thereof. Whether or not you plan to attend the Annual Meeting,
please complete, sign, date and return the enclosed proxy in the reply envelope
provided which requires no postage if mailed in the United States. Shareholders
attending the Annual Meeting may vote in person even if they have returned a
proxy. By promptly returning your proxy, you will greatly assist us in preparing
for the Annual Meeting.
By order of the Board of Directors
MARTHA HUSICK
Secretary
West Caldwell, New Jersey
October 27, 1999
<PAGE>
GREG MANNING AUCTIONS, INC.
PROXY STATEMENT FOR
1999 ANNUAL MEETING OF SHAREHOLDERS
To Be Held on December 9, 1999
This Proxy Statement and the enclosed form of proxy are being furnished,
commencing on or about October 27, 1999, in connection with the solicitation of
proxies in the enclosed form by the Board of Directors of Greg Manning Auctions,
Inc., a New York corporation (the "Company"), for use at the Annual Meeting of
Shareholders ("Shareholders") of the Company (the "Annual Meeting") to be held
at the Radisson Hotel & Suites, 690 Route 46 East, Fairfield, New Jersey 07004
at 10:00 AM Eastern Standard Time on Thursday, December 9, 1999, and any
adjournment or postponement thereof, for the purposes set forth in the foregoing
Notice of Annual Meeting of Shareholders.
The annual report of the Company, containing financial statements of the Company
as of June 30, 1999, and for the year then ended, and other information
concerning the Company is included with this proxy statement. The principal
executive offices of the Company are located at 775 Passaic Avenue, West
Caldwell, New Jersey 07006.
A list of Shareholders entitled to vote at the Annual Meeting will be available
for examination by Shareholders during ordinary business hours for a period of
ten days prior to the Annual Meeting at the offices of the Company, 775 Passaic
Avenue, West Caldwell, New Jersey 07006. A Shareholder list will also be
available for examination at the Annual Meeting.
If you are unable to attend the Annual Meeting, you may vote by proxy on any
matter to come before that meeting. The enclosed proxy is being solicited by the
Board of Directors. Any proxy given pursuant to such solicitation and received
in time for the Annual Meeting will be voted as specified in such proxy. If no
instructions are given, proxies will be voted (i) FOR the election of the
nominees named below under the caption "Election of Directors", (ii) FOR the
ratification of the appointment of Amper, Politziner & Mattia ("APM") as
independent public accountants for the Company's fiscal year ending June 30,
2000 (iii) FOR the approval of the amendment to the Company's 1997 Stock
Incentive Plan (the "1997 Plan") to increase the number of shares available for
issuance under the 1997 Plan and the Company's 1993 Stock Option Plan by
300,000, for an aggregate of 1,150,000 shares; and (iv) in the discretion of the
proxies named on the proxy card with respect to any other matters properly
brought before the Annual Meeting. Attendance in person at the Annual Meeting
will not of itself revoke a proxy; however, any Shareholder who does attend the
Annual Meeting may revoke a proxy orally and vote in person. Proxies may be
revoked at any time before they are voted by submitting a properly executed
proxy with a later date or by sending a written notice of revocation to the
Secretary of the Company at the Company's principal executive offices.
The holders of a majority of the outstanding shares of Common Stock entitled to
vote, present in person or represented by proxy, will constitute a quorum for
the transaction of business. Abstentions and shares held of record by a broker
or its nominee ("Broker Shares") that are voted on any manner are included in
determining the number of votes present. Abstentions and Broker Shares that are
not voted on any matter will not be included in determining whether a quorum is
present.
The election of each nominee for director requires a plurality of votes cast.
The affirmative vote of the holders of a majority of the issued and outstanding
shares of the Common Stock present in person or by proxy and voting thereon is
required for the approval of the appointment of the independent public
accountants and the amendment of the Company's 1997 Stock Option Plan. In all
cases abstentions and Broker Shares that are not voted will not be included in
determining the number of votes cast. The Company has appointed an inspector who
shall determine the number of shares outstanding and the voting power of each,
the shares represented at the meeting, the existence of a quorum, the validity
and effect of
<PAGE>
proxies, and shall receive votes, ballots or consents, hear and determine all
challenges and questions arising in connection with the right to vote, count and
tabulate all votes, ballots or consents, determine the result, and do such acts
as are proper to conduct the election or vote with fairness to all Shareholders.
On request of the person presiding at the meeting or any Shareholder entitled to
vote thereat, the inspectors shall make a report in writing of any challenge,
question or matter determined by them and execute a certificate of any fact
found by them. Any report or certificate made by them shall be prima facie
evidence of the facts stated and of the vote as certified by them.
Only Shareholders of record at the close of business on October 25, 1999 are
entitled to notice of, and to vote at, the Annual Meeting, and any adjournment
or postponement thereof. As of the close of business on October 25, 1999, there
were 6,853,495 shares of the Company's Common Stock, par value $.01 per share
(the "Common Stock") outstanding. Each share of Common Stock entitles the record
holder thereof to one vote on all matters properly brought before the Annual
Meeting and any adjournment or postponement thereof, with no cumulative voting.
Executive officers and directors of GMAI who owned, in the aggregate, as of the
Record Date, 55 % of the outstanding common stock have indicated an intention to
vote in the manner recommended by the Board of Directors.
PROPOSAL 1 - ELECTION OF DIRECTORS
Nominees for Election
The Company's Restated Certificate of Incorporation provides that the members of
the Company's Board of Directors be divided into three classes, as nearly equal
in size as possible, with the term of office of one class expiring each year.
Accordingly, only those directors of a single class can be changed in any one
year and it would take elections in three consecutive years to change the entire
Board. At the upcoming annual meeting, two directors will be elected to serve
three year terms (until the third succeeding annual meeting, in 2002) and until
their respective successors are duly elected and qualified. Unless authority to
vote for the election of directors is withheld, the enclosed proxy will be voted
FOR the election of the nominees named below.
Mark B. Segall and Richard Cohen have been nominated by the Board of Directors
for election to the Board, to serve until the third succeeding annual meeting,
in 2002, and until their respective successors are duly elected and qualified.
No other nominations were submitted. There is one vacancy in the class of
directors whose term is currently expiring.
Greg Manning and Albertino de Figueiredo have been elected to serve until the
2001 annual meeting of Shareholders. There is one vacancy in the class of
directors whose term expires in 2001.
Scott S. Rosenblum and Anthony L. Bongiovanni have been elected to serve until
the 2000 annual meeting of Shareholders. There is one vacancy in the class of
directors whose term expires in 2000.
Although a number of Director vacancies currently exist, the Board has
determined that it is in the Company's best interest for no additional Directors
to be nominated other than the nominees set forth below in order to give the
Board of Directors flexibility to appoint additional directors if the need
arises. Accordingly, proxies may not be voted for a greater number of persons
than the number of nominees named. The Company's Restated Certificate of
Incorporation also provides that directors may be removed only for cause and
that any such removal must be approved by the affirmative vote of at least a
majority of the outstanding shares of capital stock of the Company entitled to
vote generally in the election of directors. While the Company believes that the
foregoing provisions of the Company's Restated Certificate of Incorporation are
in the best interests of the Company and its Shareholders, such requirements may
have the effect of protecting management against outside interests and in
retaining its position.
<PAGE>
Information Concerning Directors and Officers
Background information with respect to the nominees for election, and certain
information regarding such nominees, including their principal occupations and
business experience for at least the past five years, and the directors whose
terms of office will continue after the upcoming annual meeting, appears below.
See "Security Ownership of Certain Beneficial Owners and Management" for
information regarding such persons' holdings of common stock.
By letter received by the Company on October 19, 1999, Mr. Leon Liebman, a
director of the Company whose term was due to expire this year, resigned as
director of the Company, effective immediately. Mr. Liebman indicated that his
decision was due to various other professional commitments requiring the bulk of
his time and attention.
NOMINEES FOR DIRECTORS WHOSE TERM EXPIRES IN 2002
Mark B. Segall, age 37, has been a partner at Kramer Levin Naftalis & Frankel, a
New York law firm, for more than the past five years. Commencing in October
1999, he will be a Senior Vice President and the General Counsel at Investec
Ernst & Company.
Richard M Cohen, age 48, has been the managing principal of Richard M. Cohen
Consultants since 1996. From 1992 to 1995, he served as President of General
Media, Inc. a public company with interests in magazines, cable, licensing and
the Internet. He holds a BS from the University of Pennsylvania and an MBA from
Stanford University. He is also a Certified Public Accountant in the State of
New York. Mr. Cohen is also a director of National Auto Credit, Deyco
Acquisition Corp., Symposium Telecom and Directrix, Inc.
The Board of Directors recommends that Shareholders vote FOR the election of the
nominees named above.
DIRECTORS WHOSE TERMS EXPIRE IN 2000
Scott S. Rosenblum, age 50, has been a director of the Company since December 8,
1992. Mr. Rosenblum has been a partner since 1991 in the law firm of Kramer,
Levin, Naftalis & Frankel and has served as Managing Partner of that firm since
March 1994. Mr. Rosenblum received his J.D. degree from the University of
Pennsylvania. Mr. Rosenblum is a director of Oak Tree Medical Systems, Inc., a
public company.
Anthony L. Bongiovanni, age 40, was appointed by the Board of Directors on May
8, 1997 and duly elected during the annual meeting of Shareholders in 1997. Mr.
Bongiovanni is President of Micro Strategies, Inc., a leading developer and
supplier of microcomputer based business applications throughout the New York,
New Jersey and Pennsylvania areas, which he founded in 1983. Mr. Bongiovanni has
a B.S. in mechanical engineering from Rensellaer Polytechnical Institute.
DIRECTORS WHOSE TERMS EXPIRE IN 2001
Greg Manning, age 53, has been Chairman of the Board of Directors since its
inception in 1981 and Chief Executive Officer since December 1992. Mr. Manning
has served as President of the Company from 1981 until August 1993, and from
March 1995 to the present. Mr. Manning also has been Chairman of the Board and
President of CRM since its inception, which he founded as "Greg Manning Company,
Inc." in 1961.
Albertino de Figueiredo, age 68, was appointed as a director of the Company on
September 10, 1997. In 1980, Mr. De Figueiredo founded Afinsa Bienes Tangibles
S.A., a company engaged in the business of philatelics and numismatics, and is
currently Chairman of the Board of Afinsa Bienes Tangibles S.A. and its
subsidiaries. Mr. de Figueiredo is also Vice-Chairman of the Board of Directors
of Finarte Espana, an art auction house, and a member of the Executive Board of
ASCAT, the International Association of the Stamp Catalog and Philatelic
Publishers.
Attendance at Board and Committee Meetings
<PAGE>
During the fiscal year ended June 30, 1999, there were four meetings of the
Board of Directors of the Company. Only Mr. de Figueiredo attended fewer than
75% of the meetings of the Board of Directors or meetings of the committees on
which such director served.
Committees of the Board
The Company's Board of Directors has an Audit Committee. During fiscal 1999 the
Audit Committee consisted of Scott Rosenblum and Leon Liebman. This committee
recommends to the Board of Directors the appointment of the independent public
accountants, reviews the scope and budget for the annual audit and reviews the
results of the examination of the Company's financial statements by the
independent public accountants. The audit committee met one time during fiscal
1999.
There were no nominating, compensation or stock option committees of the Board
of Directors during the year ended June 30, 1999.
EXECUTIVE OFFICERS
The executive officers of the Company are as follows:
Name Age Position
---- --- --------
Greg Manning 53 Chairman of the Board, Chief
Executive Officer and President
David C. Graham 59 Senior Vice President
James A. Smith 47 Chief Financial Officer
See "Election of Directors" for information relating to Mr. Manning.
David C. Graham, age 59, has been a Senior Vice President of the Company since
August 1990 and has been Senior Vice President of CRM since August 1990. Mr.
Graham has served the Company and CRM in various capacities since September
1978. Mr. Graham has been a licensed auctioneer since 1965. Prior to joining the
Company, Mr. Graham was employed by H.R. Harmer, a public auction house, from
1955 to 1977.
James A. Smith, age 47, has served as Chief Financial Officer of the Company
since December 1997. Mr. Smith served as Chief Financial Officer of Imatec, Ltd.
from 1996 to 1997, and as Controller of Ferrara Food Company, Inc. from 1992 to
1996.
There are no family relationships among any of the directors or executive
officers of the Company.
Advisory Committee
The Company has an advisory committee (the "Advisory Committee")
that includes prominent collectors and other individuals involved in the
philatelic and collectibles business, with whom Mr. Manning has developed
relationships over the years. The members of the Advisory Committee individually
meet from time to time with the Company's Chairman and Chief Executive Officer
to discuss current trends or developments in the collectibles market. Members of
the Advisory Committee receive no compensation for their services, and their
availability is subject to their personal schedules and other time commitments.
The Company reimburses members for their reasonable out-of-pocket expenses in
serving on the Advisory Committee.
The Company believes that the members of the Advisory Committee
have no fiduciary or other duties, obligations or responsibilities to the
Company or its stockholders, and they will not acquire any such duty, obligation
or responsibility as a result of any meeting or consultation they may have with
management of the Company. Each member of the Advisory Committee has entered
into an agreement with the Company
<PAGE>
which, among other things, confirms that the member has no such duty, obligation
or responsibility, but also commits the member to keep confidential and not
disclose (or in any manner use for personal benefit or attempt to profit from)
any non-public information relating to the Company that the member receives in
such capacity, except to the extent that disclosure is required by applicable
law or legal process or to the extent the information becomes public other than
as a result of a breach of any member's confidentiality agreement. The members
serve at will and may resign, or be asked to discontinue their services, at any
time.
The members of the current Advisory Committee and their principal occupations
are as follows:
Sir Ronald Brierley, age 61, is Founder/President of Brierley Investments,
Limited, a publicly held New Zealand investment company. Sir Ronald is also
Chairman of GPG P/C, an investment company based in London, England. Sir Ronald
serves on the boards of Advance Bank, Australia, Ltd., Adriadne Australia Ltd.,
Australia Oil & Gas Corporation, Ltd., and the Australian Gaslight Company, and
he is also a trustee of Sydney Cricket and Sports Ground Trust. Sir Ronald has
had a life-long interest in stamps, beginning as a schoolboy, when he formed
Kiwi Stamp Company and acquired a dealer's certificate from the New Zealand
Stamp Dealers Federation. Sir Ronald has been selling and collecting stamps
since that time.
Robert G. Driscoll, age 67, has been Chief Executive Officer (since 1981) of
Barrett & Worthen, Inc. and the Brookman Stamp Company of Bedford, New
Hampshire, both of which are engaged in the business of buying and selling
stamps. Mr. Driscoll served as Vice President of H.E. Harris Company, a
subsidiary of General Mills from 1978 to 1981, after having founded R&R Stamp
Company in 1958 and serving as its President until it was sold in 1978 to
General Mills. Mr. Driscoll is a past President of the American Stamp Dealers
Association (from 1977 to 1978) and is a lifetime member of the American First
Day Cover Society. He has been a member of the American Philatelic Society for
over 45 years.
Herbert LaTuchie, age 80 was Chairman of the Board and Chief Executive Officer
(from 1954 to 1986) of Modern Builders Supply Company, Inc. and Modern
Manufacturing, Inc., the latter of which is one of the ten leading distributors
of building products in the United States. Mr. LaTuchie has been a life-long
collector of rare stamps, and he also collects sheet music and other paper
collectibles.
Joseph Levy, Jr., age 73, is president of Levy Venture Management, Inc., a real
estate development company specializing in automotive retailing real estate.
Prior to forming Levy Venture Management, Mr. Levy was President of Walton
Chrysler-Plymouth (from 1953 to 1960), the world's largest Chrysler dealership
during his tenure as president of the company, and Carol Buick (from 1961 to
1984), the world's largest Buick dealership during his tenure as president. Mr.
Levy currently serves on the board of directors of CDW Computer Centers, Inc.
(NASDAQ: CDWC), and has served as a director of several banks, including NBD
Evanston. He currently sits on the boards of directors/trustees of the following
charitable and not for profit corporations: the Chicago Historical Society,
Culver Educational Foundation, Evanston Hospital, and the Levy Senior Centers.
Mr. Levy is a collector of stamps, coins, watches and other collectibles.
Hector D. Wiltshire, age 57, is President and CEO of Wiltshire Technologies,
Inc., a high technology venture capital and consulting group, and is an
experienced collector of rare stamps. Mr. Wiltshire is a member of the
Association of Certified and Corporate Accountants (A.C.C.A) and the British
Computer Society (M.B.C.S.). Mr. Wiltshire holds degrees in Executive Business
Administration and marketing.
Compliance with Section 16(a) of the Exchange Act
Based solely on a review of Forms 3 and 4 and amendments thereto
furnished to the Company during the year ended June 30, 1999 and Form 5 and
amendments thereto furnished to the Company with respect to the year ended June
30, 1999, and any written representation referred to in Item 405 of Regulation
S-B, the following directors, officers and beneficial owners of more than 10% of
the Company's Common
<PAGE>
Stock failed to file on a timely basis, as disclosed in the above forms, reports
required by Section 16 of the Securities Exchange Act of 1934, as amended,
during the year ended June 30, 1999 or any prior year:
Leon Liebman: Two late Forms
Afinsa Bienes Tangibles, S.A.: Two late Forms
Scott S. Rosenblum: Two late Forms
Greg Manning: Two late Forms
Albertino de Figueiredo: Two late Forms
Anthony L. Bongiovanni: Two late Forms
James Smith: Two late Forms
David Graham: Two late Forms
William Tully: One late Form
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth information concerning the compensation for
services in all capacities for the fiscal years ended June 30, 1999, 1998 and
1997 of those persons who were, during all or part of the fiscal year ended June
30, 1999, senior executive officers of the Company who received compensation in
excess of $100,000 in the fiscal year ended June 30, 1999.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Annual Compensation Long Term Compensation
---------------------------------------------------------------------------------------
Awards Securities
Restricted Underlying Payouts All Other
Salary Other Annual Stock Options/ LTIP Compensation
Name and Principal Position Year ($) Bonus ($) Compensation Awards SARs(#) Payouts ($)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Greg Manning, 1999 209,839 63,148(1) $26,120(2) None None None None
Chairman of the Board, 1998 188,906 None $26,123(2) None None None None
Chief Executive Officer and 1997 175,000 105,271(1) $26,650(2) None None None None
President
- -------------------------------------------------------------------------------------------------------------------
William T. Tully, 1999 161,474 31,574(1) 722,955(4) None None None None
Chief Operating Officer and 1998 132,272 None (3) None None None None
Executive Vice President 1997 127,206 30,136(1) (3) None 100,000 None None
- -------------------------------------------------------------------------------------------------------------------
David Graham 1999 65,000 None $145,078(4) None None None None
Senior Vice President
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Employment agreements with Messrs. Manning and Tully provide for an annual
bonus equal (i) in the case of Mr. Manning, 10% of pre-tax net income of
the Company between $500,000 and $2,000,000 (subject to increase by the
Board of Directors in its discretion) and (ii) in the case of Mr. Tully, 5%
of pre-tax net income of the Company in excess of $500,000 for 1999 and
$700,000 for 1997 and 1998, in each case subject to certain limitations.
See "Executive Compensation - Employment Agreements and Insurance". For
fiscal year ended 1997, the Board of Directors approved an additional bonus
to Mr. Manning in the amount of $25,000. During the fiscal year ended June
30, 1999, Mr. William Tully resigned as Chief Operating Officer and as a
director of the Company. Mr. Tully will remain with the Company and will
focus his attention on specific projects, including sourcing new product
for the Company's different sales venues
<PAGE>
(2) Represents (a) a non-accountable expense allowance equal to $25,000, and
(b) the value of the use of certain automobiles.
(3) The Company has concluded that the aggregate amount of perquisites and
other personal benefits, if any, paid did not exceed the lesser of 10% of
such officer's total annual salary and bonus for such years or $50,000;
such amounts are not included in the table.
(4) Represents the taxable value of exercised non-qualifying Employee Stock
Options during the year.
The Company has no long-term incentive plan.
Option Grants Table for Fiscal 1999
There were no stock option grants made during the fiscal year ended June 30,
1999 under the 1993 Stock Option Plan of the Company (the "1993 Plan") or the
1997 Stock Option Plan of the Company (the "1997 Plan") to executive officers
named in the Summary Compensation table. Therefore, no Option Grants Table is
included.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values
The following table sets forth information regarding the exercise of stock
options during the last fiscal year by the executive officers named in the
Summary Compensation Table and the fiscal year-end value of unexercised options.
- --------------------------------------------------------------------------------
Number of Value of
Securities Unexercised In-
Underlying The-Money
Unexercised Options at June 30,
Options at June 30, 1999
Shares Value 1999
Acquired Realized Exercisable/ Exercisable/
Name Exercise (1) Unexercisable Unexercisable (2)
---- -------- --- ------------- -----------------
Greg Manning None N/A 100,000/0 $2,000,000/$0
- --------------------------------------------------------------------------------
William T. Tully 150,000 $1,551,748 50,000/0 $1,000,000/$0
- --------------------------------------------------------------------------------
David Graham 20,625 $ 145,088 0/3,750 $0/$75,000
- --------------------------------------------------------------------------------
(1) Represents the aggregate market value of the shares converted by the
options on the date of exercise less the aggregate exercise price paid by
the executive.
(2) Assumes a fair market value for the Company's common stock of $20.00, the
closing market price per share of the Company's common stock as reported by
NASDAQ on June 30, 1999.
Compensation of Directors
The Company currently reimburses each director for expenses incurred in
connection with his attendance at each meeting of the Board of Directors or a
committee on which he serves.
Employment Agreements and Insurance
The Company has entered into an employment agreement with Mr. Manning, providing
for his services as President and Chief Executive Officer. The agreement with
Mr. Manning for the period ending June 30, 1999 provided, among other things,
for a salary equal to $210,000 per annum and a bonus equal to 10% of
<PAGE>
the Company's audited pre-tax net income between $500,000 and $2,000,000 (as
calculated excluding the formula-based bonus payable to either of Messrs.
Manning or Tully and subject to increase by the Board of Directors). Mr. Manning
received from the Company a base salary of $ 210,000, $188,906 and $175,000 for
fiscal years 1999, 1998 and 1997, respectively and a bonus of $63,148, $0 and
$105,271 (includes a bonus of $25,000 in addition to the formula-based bonus)
for fiscal years 1999, 1998 and 1997, respectively. The Company has entered into
an agreement with Mr. Manning extending the term of his agreement through June
30, 2000 with a new base salary of $300,000 and all other terms and conditions
remaining the same
Pursuant to an employment agreement with Mr. Tully, Mr. Tully was entitled to
receive a base salary of $110,000 per year through the year ended June 30, 1999,
with annual increases equal to the increase in the Consumer Price Index plus
1.5%, plus a bonus based on 5% of the Company's audited pre-tax net income above
$500,000 for 1999 and $700,000 in each such previous year, as calculated
excluding the formula-based bonus payable to either of Messrs. Manning or Tully
and subject to certain maximum limitations. Mr. Tully received a bonus of
$31,574, $0 and $30,136 for fiscal years 1999, 1998 and 1997, respectively. Mr.
Tully was also entitled to a vehicle for business use. During the fiscal year
ended June 30, 2000, Mr. William Tully resigned as Chief Operating Officer and
as a director of the Company. Mr. Tully is continuing to work as a consultant to
the Company.
Mr. Manning's employment agreement also provides that in the event the agreement
is terminated as a result of disability (as defined therein) or death, Mr.
Manning will receive from the Company compensation equal to 66-2/3% of his
annual base salary and cash bonus for a period of 12 months. Mr. Manning is
eligible to participate in any employee benefit plan and fringe benefit
programs, if any, as may be determined by the Company for its employees
generally from time to time.
The Company currently maintains a $1,000,000 term life insurance policy on the
life of Mr. Manning with benefits payable to the Company.
The Company offers basic health, major medical and life insurance to its
employees. The Company adopted a 401(k) Retirement Plan effective July 1, 1997,
with respect to which all employees are entitled to participate. The Company has
agreed to match employee contributions in an amount equal to 10% of each
employee's contribution, up to a maximum of $500 per employee per year. The
Company has adopted no other retirement, pension or similar program.
Indemnification of Directors and Officers
The Company's Restated Certificate of Incorporation includes certain provisions
permitted pursuant to the New York Business Corporation Law (the "NYBCL"),
whereby officers and directors of the Company are to be indemnified against
certain liabilities. The Restated Certificate of Incorporation also limits to
the fullest extent permitted by the NYBCL a director's liability to the Company
or its Shareholders for monetary damages for breach of any duty as a director,
except for certain instances of bad faith, intentional misconduct, a knowing
violation of any law or illegal personal gain. This provision of the Restated
Certificate of Incorporation has no effect on any director's liability under
Federal securities laws or the availability of equitable remedies, such as
injunction or rescission, for breach of fiduciary duty. The Company believes
that these provisions will facilitate the Company's ability to continue to
attract and retain qualified individuals to serve as directors and officers of
the Company.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
<PAGE>
Security Ownership of Certain Beneficial Owners
Set forth below is certain information with respect to persons known by the
Company to own beneficially, as of October 25, 1999, 5% or more of the
outstanding shares of its Common Stock:
- --------------------------------------------------------------------------------
Name and Address of Amount and Nature Percent of
Beneficial Owner of Beneficial Ownership Common Stock
- --------------------------------------------------------------------------------
Greg Manning (1)
775 Passaic Avenue
West Caldwell, New Jersey 07006 1,600,000 23%
- --------------------------------------------------------------------------------
Afinsa Bienes Tangibles, S.A. (2)
Lagasca 88
Madrid, Spain 28001 1,117,623 16%
- --------------------------------------------------------------------------------
Leon Liebman
775 Passaic Avenue
West Caldwell, New Jersey 07006 973,720 14%
- --------------------------------------------------------------------------------
(1) Includes options to purchase 100,000 shares (all of which are exercisable)
granted pursuant to the 1993 plan.
(2) Afinsa Bienes Tangibles S.A. ("Afinsa") owns 1,117,623 shares of Common
Stock of the Company. Mr. De Figueiredo, a director of the Company, owns
50% of the outstanding shares of common stock of Afinsa.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information with respect to the
beneficial ownership of shares of GMAI common stock, as of October 25, 1999, by
(i) each person known (based solely on Schedules 13D or G filed) to GMAI to be
the beneficial owner of more than 5% of the common stock, (ii) each member of
the Board of Directors of GMAI, (iii) the named executive officers of GMAI and
(iv) all directors and executive officers of GMAI as a group (based upon
information furnished by such persons). Under the rules of the Securities and
Exchange Commission, a person is deemed to be a beneficial owner of a security
if such person has or shares the power to vote or direct the voting of such
security or the power to dispose of or to direct the disposition of such
security. In general, a person is also deemed to be a beneficial owner of any
securities of which that person has the right to acquire beneficial ownership
within 60 days. Accordingly, more than one person may be deemed to be a
beneficial owner of the same securities.
<PAGE>
- --------------------------------------------------------------------------------
Name and Address of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership (1) Common Stock (2)
- --------------------------------------------------------------------------------
Greg Manning (3)
775 Passaic Avenue
West Caldwell, New Jersey 07006 1,600,000 23%
- --------------------------------------------------------------------------------
Albertino de Figueiredo (4)
Lagasca 88
Madrid, Spain 28001 1,121,373 16%
- --------------------------------------------------------------------------------
Leon Liebman (5)
775 Passaic Avenue
West Caldwell, New Jersey 07006 973,720 14%
- --------------------------------------------------------------------------------
Scott S. Rosenblum (6)
919 Third Avenue
New York, New York 10022 6,500 *
- --------------------------------------------------------------------------------
William T. Tully, Jr. (7)
775 Passaic Avenue
West Caldwell, New Jersey 07006 101,150 1%
- --------------------------------------------------------------------------------
James A. Smith (8)
775 Passaic Avenue
West Caldwell, New Jersey 07006 5,000 *
- --------------------------------------------------------------------------------
Anthony Bongiovanni (9)
104 Broadway
Denville, New Jersey 07866 8,500 *
- --------------------------------------------------------------------------------
Richard M. Cohen (10)
C/o Murphy & Partners
630 Fifth Avenue, Suite 1960
New York, New York 10111 10,000 *
- --------------------------------------------------------------------------------
David Graham (11)
775 Passaic Avenue
West Caldwell, New Jersey 07006 21,250 *
- --------------------------------------------------------------------------------
All Executive Officers and Directors,
as a group 3,816,243 55%
- --------------------------------------------------------------------------------
* Less than 1%
(1) Except as otherwise indicated below, each named person has voting and
investment Power with respect to the securities owned by them.
(2) Based on 6,853,495 shares outstanding, calculated in accordance with Rule
13d-3(d)(1)(i) under the Securities Exchange Act of 1934, as amended.
(3) Includes 1,500,000 shares of Common Stock and 100,000 shares (all of
which are exercisable within 60 days of October 25, 1999) granted
pursuant to the 1993 Plan.
(4) Includes 1,117,623 shares of Common Stock owned by Afinsa. Mr. de
Figueiredo owns 50% of the outstanding shares of common stock of Afinsa.
Also includes options exercisable within 60 days of October 25, 1999 to
purchase 3,750 shares of Common Stock granted pursuant to the 1997 Plan
(but does not include options not exercisable within 60 days of October
25, 1999 to purchase 11,250 shares of Common Stock).
<PAGE>
(5) Does not include options not exercisable within 60 days of October 25,
1999 to purchase 15,000 shares of Common Stock granted pursuant to the
1997 Plan.
(6) Includes options exercisable within 60 days of October 25, 1999 to
purchase 2,500 shares of Common Stock (but does not include options not
exercisable within 60 days of October 25, 1999 to purchase 27,500 shares
of Common Stock) granted pursuant to the 1997 Plan.
(7) Includes 1,150 shares of Common Stock owned by members of Mr. Tully's
immediate family and 20,000 shares (all of which are exercisable within
60 days of October 25, 1999) granted pursuant to the 1993 Plan.
(8) Includes options exercisable within 60 days of October 25, 1999 to
purchase 2,500 shares of Common Stock (but does not include options not
exercisable within 60 days of October 25, 1999 to purchase 15,000 shares
of Common Stock) granted pursuant to the 1997 Plan.
(9) Includes options exercisable within 60 days of October 25, 1999 to
purchase 7,500 shares of Common Stock (but does not include options not
exercisable within 60 days of October 25, 1999 to purchase 22,500 shares
of Common Stock) granted pursuant to the 1997 Plan.
(10) Includes options exercisable within 60 days of October 25, 1999 to
purchase 10,000 Shares of Common Stock .
(11) Does not include options not exercisable within 60 days of October 25,
1999 to purchase 3,750 shares of Common Stock granted pursuant to the
1997 Plan.
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Scott Rosenblum, a director of the Company, is a partner of the
law firm Kramer, Levin, Naftalis & Frankel, which provides legal services to the
Company. Anthony L. Bongiovanni, Jr., also a director of the Company, is
president of Micro Strategies, Incorporated, which provides computer services to
the Company. Leon Liebman, also a director of the Company, provided consulting
services for the Company. Amounts paid for services rendered by these related
parties for the year ended June 30, 1998 and 1999 were approximately $124,000
and $334,000 respectively (of which, $129,000 was charged to operations in
fiscal 1999), in the case of Kramer, Levin, Naftalis & Frankel, approximately
$76,000 and $ 154,000 respectively (of which, approximately $113,000 was charged
to operations in fiscal 1999), in the case of Micro Strategies, Incorporated and
approximately $0 and $ 29,000 in the case of Leon Liebman.
In the normal course of business, Afinsa consigned material to
the Company which was auctioned during the fiscal year ended June 30, 1999 for a
total hammer price of $316,600 and purchased artwork totaling $850,000.
PROPOSAL 2 - APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed the firm of Amper, Politziner & Mattia as
the Company's independent public accountants for the fiscal year ending June 30,
2000.
Shareholders will be asked to ratify the appointment of Amper, Politziner &
Mattia as independent public accountants of the Company for the fiscal year
ending June 30, 2000. Ratification of the appointment requires the affirmative
vote of a majority of the shares of Common Stock present at the Annual Meeting
(or represented by proxy) and entitled to vote thereon.
The Board of Directors recommends that Shareholders vote FOR ratification of the
appointment of Amper, Politziner & Mattia.
It is expected that a representative of Amper Politziner & Mattia will be
present at the Annual Meeting with the opportunity to make a statement if Amper,
Politziner & Mattia desires to do so, and will be available to respond to
appropriate questions.
PROPOSAL 3 - APPROVAL OF THE AMENDMENT TO THE COMPANY'S 1997 STOCK OPTION PLAN
In 1997, the Company's Board of Directors adopted and the Company's shareholders
approved the 1997 Stock Incentive Plan, as amended (the "1997 Plan") which
increased the number of shares available to be issued under the 1997 Plan and
the Company's 1993 Stock Option Plan (the "1993 Plan") to 850,000 in the
aggregate. The Board of Directors has made grants of options as a means of
providing incentives to officers, employees and consultants and enabling them to
realize compensation based on increases in shareholder value. Grants were made
to persons who had been, and were expected to continue to be, important in
helping the Company achieve and continue its rapid growth. As of October 25,
1999, options to purchase a total of 434,625 shares of Common Stock were
outstanding under both the 1993 Plan and the 1997 Plan and accordingly, 37,500
shares remained available for grants under the Plans. The Company does not
intend to make any further grants under the 1993 Plan.
The Board of Directors believes that in light of the Company's continuing
growth, its intent to make acquisitions in the future and the need to remain
competitive in its industry in attracting and retaining talented employees,
including senior executives, the Company will need the authority to make grants
covering a greater number of shares in the next several years than remain
authorized under the 1997 Plan. The failure to make available such grants when
necessary would, in the Board's judgment,
<PAGE>
negatively impact the Company's future growth and profitability and, therefore,
its ability to enhance stockholder value.
Accordingly, the Board of Directors has approved, subject to shareholder
approval, the following amendment to the first sentence of Section 1.5.1 of 1997
Stock Option Plan, which would increase the number of shares available for
issuance under the 1997 Plan and the 1993 Plan by 300,000, for an aggregate of
1,150,000 shares:
"1.5.1 the total number of shares of common stock of the Company, par value $.01
per share ("Common Stock"), which may be issued in connection with awards
granted under the Plan, shall, together with any shares issued in connection
with awards granted under the Greg Manning Auctions, Inc. 1993 Stock Option
Plan, as amended (the "1993 Plan), not exceed 1,150,000."
Vote Required
The affirmative vote of the holders of a majority of shares present in person or
represented by proxy and entitled to vote at the Annual Meeting is required to
approve the amendment to the 1997 Plan.
The Board of Directors recommends that Shareholders vote FOR approval of the
amendment to the 1997 Stock Incentive Plan.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be considered as of the next Annual Meeting of
Shareholders must be received by the Company, addressed to the attention of the
Company's Secretary, at its offices at 775 Passaic Avenue, West Caldwell, New
Jersey 07006, no later than June 30, 2000, in order to be included in the
Company's proxy statement relating to that meeting.
OTHER BUSINESS
The Board of Directors is not aware of any other matter that is to be presented
to Shareholders for formal action at the Annual Meeting. If, however, any other
matter properly comes before the meeting or any adjournment or postponement
thereof, it is the intention of the persons named in the enclosed form of proxy
to vote such proxies in accordance with their judgement on such matters.
<PAGE>
OTHER INFORMATION
Although it has entered into no formal agreements to do so, the Company will
reimburse banks, brokerage houses and other custodians, nominees and fiduciaries
for their reasonable expenses in forwarding proxy-soliciting materials to their
principals. The cost of soliciting proxies on behalf of the Board of Directors
will be borne by the Company. Such proxies will be solicited principally through
the mail but, if deemed desirable, may also be solicited personally or by
telephone, telegraph, facsimile transmission or special letter by directors,
officers and regular employees of the Company without additional compensation.
IT IS IMPORTANT THAT YOUR STOCK BE REPRESENTED AT THE ANNUAL MEETING WHETHER OR
NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING. THE BOARD URGES YOU TO COMPLETE,
DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED POSTAGE-PAID REPLY
ENVELOPE. YOUR COOPERATION AS A SHAREHOLDER, REGARDLESS OF THE NUMBER OF SHARES
OF STOCK YOU OWN, WILL REDUCE THE EXPENSES INCIDENT TO A FOLLOW-UP SOLICITATION
OF PROXIES.
IF YOU HAVE ANY QUESTIONS ABOUT VOTING YOUR SHARES, PLEASE TELEPHONE THE COMPANY
AT (973) 882-0004.
Sincerely,
MARTHA HUSICK
Secretary
West Caldwell, New Jersey
October 27, 1999
<PAGE>
GREG MANNING AUCTIONS, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY FOR THE
ANNUAL MEETING OF THE SHAREHOLDERS TO BE HELD DECEMBER 9, 1999
The undersigned hereby appoints Greg Manning and James Smith, or any of
them, each with full power to act alone and with the power of substitution, as
proxies to vote all the shares of Common Stock the undersigned is entitled to
vote on the following proposals and upon such other matters as may properly come
before the Annual Meeting of Shareholders of Greg Manning Auctions, Inc., (the
"Company"), to be held at the Radisson Hotel &Suites, 690 Route 46 East,
Fairfield, New Jersey 07004, on December 9, 1999,10:00 a.m., Eastern Standard
Time, and at any adjournment or postponement thereof.
THIS PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS OF GREG MANNING
AUCTIONS, INC. AND WHEN PROPERLY EXECUTED AND RETURNED WILL BE VOTED IN THE
MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS GIVEN,
THIS PROXY WILL BE VOTED BY THE PROXIES FOR THE ELECTION OF THE DIRECTOR
NOMINEES LISTED BELOW, FOR THE RATIFICATION OF THE APPOINTMENT OF AMPER,
POLITZINER & MATTIA AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS FOR FISCAL
YEAR ENDING JUNE 30, 1999, FOR THE APPROVAL OF THE AMENDMENT TO THE COMPANY'S
1997 STOCK INCENTIVE PLAN AND IN ACCORDANCE WITH THEIR DISCRETION UPON SUCHOTHER
MATTERS AS MAY PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNMENTS OR
POSTPONEMENTS THEREOF.
THIS PROXY MAY BE REVOKED AT ANY TIME BEFORE THE AUTHORITY HEREBY GRANTEDIS
EXERCISED BY (I) DELIVERING A WRITTEN STATEMENT OF REVOCATION TO GREG
MANNINGAUCTIONS, INC., 775 PASSAIC AVENUE, WEST CALDWELL, NEW JERSEY 07006,
ATTENTION:SECRETARY (II) BY SUBMITTING A LATER DATED PROXY OR (III) ATTENDING
THE ANNUAL MEETING AND VOTING IN PERSON.
YOUR VOTE IS IMPORTANT. ACCORDINGLY, YOU ARE URGED TO SIGN AND RETURN THIS
PROXY CARD WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.
[Please date and sign on the reverse side]
<PAGE>
GREG MANNING AUCTIONS, INC. PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF THE COMPANY FOR THE ANNUAL MEETING OF THE SHAREHOLDERS TO BE HELD DECEMBER 9,
1999 The undersigned hereby appoints Greg Manning and James Smith, or any of
them, each with full power to act alone and with the power of substitution, as
proxies to vote all the shares of Common Stock the undersigned is entitled to
vote on the following proposals and upon such other matters as may properly come
before the Annual Meeting of Shareholders of Greg Manning Auctions, Inc., (the
"Company"), to be held at the Radisson Hotel &Suites, 690 Route 46 East,
Fairfield, New Jersey 07004, on December 9, 1999,10:00 a.m., Eastern Standard
Time, and at any adjournment or postponement thereof.
THIS PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS OF GREG MANNING
AUCTIONS, INC. AND WHEN PROPERLY EXECUTED AND RETURNED WILL BE VOTED IN THE
MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS GIVEN,
THIS PROXY WILL BE VOTED BY THE PROXIES FOR THE ELECTION OF THE DIRECTOR
NOMINEES LISTED BELOW, FOR THE RATIFICATION OF THE APPOINTMENT OF AMPER,
POLITZINER & MATTIA AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS FOR FISCAL
YEAR ENDING JUNE 30, 1999, FOR THE APPROVAL OF THE AMENDMENT TO THE COMPANY'S
1997 STOCK INCENTIVE PLAN AND IN ACCORDANCE WITH THEIR DISCRETION UPON SUCHOTHER
MATTERS AS MAY PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNMENTS OR
POSTPONEMENTS THEREOF. THIS PROXY MAY BE REVOKED AT ANY TIME BEFORE THE
AUTHORITY HEREBY GRANTEDIS EXERCISED BY (I) DELIVERING A WRITTEN STATEMENT OF
REVOCATION TO GREG MANNINGAUCTIONS, INC., 775 PASSAIC AVENUE, WEST CALDWELL, NEW
JERSEY 07006, ATTENTION:SECRETARY (II) BY SUBMITTING A LATER DATED PROXY OR
(III) ATTENDING THE ANNUAL MEETING AND VOTING IN PERSON. YOUR VOTE IS IMPORTANT.
ACCORDINGLY, YOU ARE URGED TO SIGN AND RETURN THIS PROXY CARD WHETHER OR NOT YOU
PLAN TO ATTEND THE MEETING.
The Board of Directors recommends a vote FOR the election of the director
nominees listed below and FOR all the items below, and shares will be so voted
unless you indicate otherwise.
1. Election of Directors, to serve until the 2000 annual meeting of shareholders
of the Company and until their respective successors shall have been duly
elected and qualified.
[ ] FOR the nominees listed at right.
[ ] WITHHOLD AUTHORITY to vote for the nominees listed at right.
Nominees for Directors are: Mark B Segall, Richard M. Cohen
2. Ratification of the Appointment of Amper, Politziner & Mattia as theCompany's
independent public accountants for the Company's fiscal year ending June 30,
2000. [ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Approval of the amendment to the Company's 1997 Stock Incentive Plan. [ ] FOR
[ ] AGAINST [ ] ABSTAIN
4. In their discretion, the Proxies are authorized to consider and act upon
suchother matters as may properly come before the meeting or any and
allpostponements or adjournments thereof.
Signature______________________________
Signature______________________________ Dated_____________, 1999
NOTE:Please sign exactly as name appears. When shares are held by joint tenants,
both should sign. When signing as attorney, executor, administrator, trustee,
broker or guardian, please give full title and proof of authority as such. If a
corporation, please sign in full corporate name by president or other authorized
officer. If a partnership, please sign in partnership name by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY, USING THE ENCLOSED
ENVELOPE.
