<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] 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
</TABLE>
BROCK INTERNATIONAL, 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] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
BROCK INTERNATIONAL, INC.
SUITE 1000
2859 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
April 4, 1997
Dear Shareholder:
You are cordially invited to attend the 1997 Annual Meeting of
Shareholders of Brock International, Inc. (the "Company"), which will be held at
2:30 p.m. on Tuesday, May 6, 1997, at Brock International Headquarters, 2859
Paces Ferry Road, Suite 1000, Atlanta, GA 30339.
The principal business of the meeting will be to elect directors for the
ensuing year. During the meeting, we will review the results of the past year
and report on significant aspects of our operations for 1997.
Whether or not you plan to attend the Annual Meeting, please complete,
sign, date and return the enclosed proxy card in the postage prepaid envelope
provided so that your shares will be voted at the meeting. If you decide to
attend the meeting, you may, of course, revoke your proxy and personally cast
your vote.
Sincerely yours,
/s/ R. Douglas MacIntyre
-----------------------------
R. Douglas MacIntyre
President and Chief Executive
Officer
<PAGE> 3
BROCK INTERNATIONAL, INC.
SUITE 1000
2859 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The 1997 Annual Meeting of Shareholders of Brock International, Inc.
(the "Company") will be held at 2:30 p.m. on Tuesday, May 6, 1997, at Brock
International Headquarters, 2859 Paces Ferry Road, Suite 1000, Atlanta, GA
30339. The meeting is called for the following purposes:
(1) To elect directors for the ensuing year; and
(2) To transact such other business as may properly come before
the meeting.
The Board of Directors has fixed the close of business on March 26, 1997
as the record date for the purpose of determining the shareholders who are
entitled to notice of and to vote at the meeting and any adjournment or
postponement thereof.
By order of the Board of Directors,
/s/ R. Douglas MacIntyre
--------------------------------------
R. Douglas MacIntyre
President and Chief Executive Officer
April 4, 1997
Atlanta, Georgia
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE REQUESTED TO
COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY SO THAT YOUR SHARES WILL BE
REPRESENTED.
<PAGE> 4
BROCK INTERNATIONAL, INC.
SUITE 1000
2859 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
PROXY STATEMENT
This Proxy Statement is furnished by and on behalf of the Board of
Directors of Brock International, Inc. (the "Company") in connection with the
solicitation of proxies for use at the Annual Meeting of Shareholders of the
Company to be held at 2:30 p.m. on Tuesday, May 6, 1997, at Brock International
Headquarters, 2859 Paces Ferry Road, Suite 1000, Atlanta, GA 30339 and at any
adjournments or postponements thereof (the "Annual Meeting"). This Proxy
Statement and the enclosed proxy card will be first mailed on or about April 4,
1997 to the Company's shareholders of record on the Record Date, as defined
below.
THE BOARD OF DIRECTORS URGES YOU TO COMPLETE, SIGN, DATE AND RETURN THE
ENCLOSED PROXY CARD IN THE POSTAGE PREPAID ENVELOPE PROVIDED.
SHARES ENTITLED TO VOTE
Proxies will be voted as specified by the shareholders granting the
proxy. Unless contrary instructions are specified, if the enclosed proxy card is
executed and returned (and not revoked) prior to the Annual Meeting, the shares
of common stock, no par value per share ("Common Stock"), of the Company
represented thereby will be voted FOR the election as directors of the nominees
listed in this Proxy Statement. The submission of a signed proxy will not affect
a shareholder's right to attend and to vote in person at the Annual Meeting. A
shareholder who executes a proxy may revoke it at any time before it is voted by
filing with the Secretary of the Company either in written revocation or an
executed proxy bearing a later date or by attending and voting in person at the
Annual Meeting.
Only holders of record of Common Stock as of the close of business on
March 26, 1997 (the "Record Date") will be entitled to vote at the Annual
Meeting. As of the close of business on the Record Date, there were 4,950,792
shares of Common Stock (the "Shares") outstanding. Holders of Shares authorized
to vote are entitled to cast one vote per Share on all matters. The holders of a
majority of the Shares entitled to be voted must be present or represented by
proxy to constitute a quorum. Shares as to which authority to vote is withheld,
abstentions and broker non-votes are counted in determining whether a quorum
exists.
Under Georgia Law, directors are elected by the affirmative vote, in
person or by proxy, of a plurality of the shares entitled to vote in the
election at a meeting at which a quorum is present. Only votes actually cast
will be counted for the purpose of determining whether a particular nominee
received more votes than the persons, if any, nominated for the same seat on the
Board of Directors. Accordingly, votes withheld from director nominees will not
be included in vote totals and will not be considered in determining the outcome
of the vote.
Any matter that may properly come before the Annual Meeting requires the
affirmative vote of a majority of the Shares present in person or by proxy and
entitled to vote on such matter. Abstentions will be counted in determining the
minimum number of votes required for approval and will, therefore, have the
effect of negative votes. Broker non-votes will not be counted as votes for or
against approval of either of such proposals or any other matter properly
brought before the Annual Meeting and therefore will not affect the outcome of
any such vote.
<PAGE> 5
PROPOSAL 1 - ELECTION OF DIRECTORS
The Board of Directors of the Company presently consists of five
members. The current terms of all existing directors expire upon the election
and qualification of the directors to be selected at this Annual Meeting. The
Board of Directors has nominated Richard T. Brock, Harry S. Gruner, Said
Mohammadioun, James R. Porter, and R. Douglas MacIntyre for the re-election to
the Board of Directors at the Annual Meeting, each to serve until the 1998
Annual Meeting of Shareholders and until their successors are duly elected and
qualified.
All shares represented by properly executed proxies received in response
to this solicitation will be voted for the election of directors as specified
therein by the shareholders. Unless otherwise specified in the proxy, it is the
intention of the persons named on the enclosed proxy card to vote FOR the
election of the nominees listed in this Proxy Statement to the Board of
Directors. Each nominee has consented to serve as a director of the Company if
elected. If at the time of the Annual Meeting any nominee is unable or declines
to serve as a director, the discretionary authority provided in the enclosed
proxy card will be exercised to vote for a substitute candidate designated by
the Board of Directors. The Board of Directors has no reason to believe that any
of its nominees will be unable or will decline to serve as a director.
Shareholders may withhold their votes from the entire slate of nominees
by so indicating in the space provided on the enclosed proxy card. Shareholders
may withhold their votes from any particular nominee by writing that nominee's
name in the space provided for that purpose on the enclosed proxy card.
Set forth below is certain information furnished to the Company by each
nominee.
DIRECTOR NOMINEE BIOGRAPHICAL INFORMATION
RICHARD T. BROCK
Age: 49
Mr. Brock, the founder of the Company, has served as Chairman of the
Board of Directors since the Company's inception in October 1984. He also served
as the Company's Chief Executive Officer from October 1984 until November 1992,
when he relinquished that position. In November 1994, Mr. Brock again assumed
the positions of President and Chief Executive Officer until December 1996, when
he relinquished those positions. Mr. Brock is also a director of Datastream
Systems, Inc., a leading provider of maintenance software. Prior to founding the
Company, Mr. Brock founded and served as Chief Executive Officer of Management
Control Systems, Inc., now a division of CLR Professional Software. Mr. Brock
received an MBA from Louisiana State University and a BS from Spring Hill
College. He is also a Certified Public Accountant.
HARRY S. GRUNER
Age 37
Mr. Gruner has been a director of the Company since the Company's
initial public offering in March 1993. He has been a general partner of JMI
Services, Inc., a venture capital firm, since 1992. From 1986 until 1992, Mr.
Gruner served as a Vice President and then a Principal of Alex. Brown & Sons
Incorporated. Mr. Gruner is also a director of Hyperion Software, Inc., a
financial software company; META Group, Inc., an information technology and
market assessment services company; V-One Corporation, a security software
company; Optika Imaging, Inc., an imaging software company; and Jackson Hewitt,
Inc., a tax preparation and services company.
2
<PAGE> 6
SAID MOHAMMADIOUN
Age: 49
Mr. Mohammadioun has been a director of the Company since April 1994.
Mr. Mohammadioun is Chief Executive Officer of Synchrologic Inc., a company in
the client server tools market. He also serves as a director for Intelliquest
Communications, Inc., an on-line registration services company, and a director
of Software Builders, Inc., a custom software company. He is also on the
Advisory Board of the College of Computing at The Georgia Institute of
Technology. From 1990 to 1995, Mr. Mohammadioun was Vice President of Lotus
Development Corporation running various product divisions. Mr. Mohammadioun was
founder and CEO of Samna Corporation from 1982 until it was acquired by Lotus in
1990. Mr. Mohammadioun has over 25 years of experience in the computer industry.
JAMES R. PORTER
Age: 61
Mr. Porter has been a director of the Company since the Company's
initial public offering in March 1993. He has served since September 1985 as
President, Chief Executive Officer and a director of Triad Systems Corporation,
a provider of business and information management solutions for the retail hard
lines industry and the automotive aftermarket. He also serves on the Board of
Regents of Pepperdine University and on the Board of Trustees of Abilene
Christian University. Mr. Porter is also a director of Silicon Valley Bank and
Triad Park, LLC.
R. DOUGLAS MACINTYRE
Age: 45
Mr. MacIntyre serves as President and Chief Executive Officer since
joining the Company in December of 1996. From 1994 until that time, Mr.
MacIntyre served as President and Chief Executive Officer and director of Dun &
Bradstreet Software. From 1990 to 1993, Mr. MacIntyre served as President, Chief
Operating Officer and director for Software 2000, and from 1980 to 1990 he held
various management positions at Management Science America, Inc. Mr. MacIntyre
graduated from the U.S. Military Academy at West Point, receiving a BS degree.
Mr. MacIntyre received an MSBA from Boston University and has attended Stanford,
Wharton, and Harvard business school executive programs. Mr. MacIntyre serves as
chairman of HomeCom Communications, Inc., an Internet development company, and
is immediate past President of the American Software Association.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS
VOTE FOR THE ELECTION AS DIRECTORS OF THE NOMINEES LISTED ABOVE.
ADDITIONAL INFORMATION CONCERNING THE BOARD OF DIRECTORS
The Company's Board of Directors held four meetings during 1996. The
Board has an Audit Committee and a Compensation Committee, but does not have a
Nominating Committee. All directors attended at least 75% of the aggregate
number of meetings of the Board and the committees of the Board on which he
served, except James R. Porter who attended at least 50% of the meetings.
The Audit Committee was formed in May 1993 and for 1996 consisted of
Messrs. Gruner, Mohammadioun and Porter, with Mr. Gruner serving as Chairman.
The responsibilities of the Audit Committee include, in addition to such other
duties as the Board may specify, reviewing and making recommendations to the
Board regarding the Company's employment of independent auditors, the annual
audit of the Company's financial statements and the Company's internal
accounting practices and policies. The Audit Committee met twice during 1996.
3
<PAGE> 7
The Compensation Committee also was formed in May 1993 and for 1996 also
consisted of Messrs. Gruner, Mohammadioun and Porter, with Mr. Porter serving as
Chairman. The responsibilities of the Compensation Committee include, in
addition to such other duties as the Board may specify, making recommendations
to the Board regarding compensation arrangements for senior management of the
Company (including annual bonus compensation), the adoption of any compensation
plans in which management is eligible to participate and the grants of stock
options or other benefits under such plans. The Compensation Committee met once
during 1996.
During 1996, each non-management director of the Company received an
annual retainer of $5,000 and a fee of $2,500 for each day on which he attended
a Board or committee meeting. All directors are reimbursed for expenses incurred
in connection with attendance at Board and committee meetings.
EXECUTIVE OFFICERS
The executive officers of the Company serve at the discretion of the
Board of Directors. In addition to Mr. MacIntyre, at the end of 1996, the
executive officers of the Company consisted of James A. Byrnes, Judith A. Vitale
and Wayne P. Webb. Set forth below is certain information furnished by each of
these persons.
JAMES A. BYRNES
Age: 38
Mr. Byrnes joined the Company in June of 1996 and currently serves as
Vice President, Sales. From 1995 until that time, Mr. Byrnes served as Regional
Manager of Dun & Bradstreet Software. Mr. Byrnes has also served as District
Sales Manager and National Sales Director for Dun & Bradstreet's Sales
Technologies Inc. Division from 1992 to 1995. From 1980 to 1992, Mr. Byrnes held
several management positions at IBM Corporation, including Marketing Manager and
Finance Industry Executive. Mr. Byrnes has a BA in Business Administration from
St. Michael's College in Winooski, Vermont.
JUDITH A. VITALE
Age: 42
Ms. Vitale has served the Company as Director of Finance and
Administration since March 1996. Prior to that time, she held various positions
with the Company since its formation in October 1984, including Manager of
Administration, Manager of Finance, and Corporate Controller. From 1979 until
the formation of the Company, Ms. Vitale was the Manager of Administration at
Management Control Systems, Inc., also founded by Mr. Brock, and now a division
of CLR Professional Software.
WAYNE P. WEBB
Age: 48
Mr. Webb joined the Company in January 1991 and currently services as
Vice President, International Operations. In this capacity, Mr. Webb is
responsible for all of the Company's international operations. Prior to that
time, Mr. Webb served as Manager - International Operations, overseeing the
Company's business outside North America. Prior to joining the Company, Mr. Webb
held various executive and sales positions in the U.S. telecommunications
industry. Mr. Webb has an MA and an MBA from the University of West Florida. Mr.
Webb has a BS from the Georgia Institute of Technology while on an ROTC
scholarship.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange
Act") requires the Company's directors, executive officers and persons who own
beneficially more than 10% of the Company's Common Stock to file reports of
ownership and changes in ownership of such stock with the Securities and
Exchange Commission (the "SEC") and the National Association of Securities
Dealers, Inc. Directors, executive officers and greater than 10% shareholders
are required by SEC regulations to furnish the Company with copies of all
4
<PAGE> 8
such forms they file. To the Company's knowledge, based solely on a review of
the copies of such reports furnished to the Company and written representations
that no other reports were required, all of its directors and executive officers
complied during 1996 with all applicable Section 16(a) filing requirements.
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth information concerning (i) those persons
known by management of the Company to own beneficially more than 5% of the
Company's outstanding Common Stock, (ii) the directors and director nominees of
the Company, (iii) the executive officers named in the Summary Compensation
Table included elsewhere herein and (iv) all directors and current executive
officers of the Company as a group. Except as otherwise indicated in the
footnotes below, such information is provided as of March 26, 1997. According to
rules adopted by the Securities and Exchange Commission, a person is the
"beneficial owner" of securities if he or she has or shares the power to vote
them or to direct their investment or has the right to acquire beneficial
ownership of such securities within 60 days through the exercise of an option,
warrant or right, conversion of a security or otherwise. Except as otherwise
noted, the indicated owners have sole voting and investment power with respect
to shares beneficially owned. An asterisk in the percent of class column
indicates beneficial ownership of less than 1% of the outstanding Common Stock.
<TABLE>
<CAPTION>
Amount and Nature
of Beneficial Percent of
Name of Beneficial Owner Ownership Class
<S> <C> <C>
Private Capital Management, Inc (1) ............................. 1,503,220 30.4
Richard T Brock ................................................ 1,768,224 35.7
R Douglas MacIntyre ............................................ 22,000 *
Harry S Gruner ................................................. 5,000 *
Said Mohammadioun ............................................... 19,500(2) *
James R Porter ................................................. 2,000 *
All directors, director nominees and executive officers
as a group (8 persons) ......................................... 1,841,869(2) 37.2
</TABLE>
1) The indicated shares are beneficially owned by a group that includes
Private Capital Management, Inc., SPS Partners, L.P., and Bruce S.
Sherman (whose address is 3003 Tamiami Trail N., Naples, FL 33940).
This information provided herein concerning this investor is based on a
review of a Schedule 13G dated February 14, 1997 filed by these parties
with the SEC. The information reported is as of December 31, 1996.
2) Includes shares subject to options exercisable on or before May 26,
1997.
5
<PAGE> 9
EXECUTIVE COMPENSATION
Under the SEC rules for proxy statement disclosure of executive
compensation, the Compensation Committee of the Board of Directors of the
Company has prepared the following report on executive compensation. Set forth
below is a discussion of the Company's executive compensation philosophy and
policies as established and implemented by the Compensation Committee for 1996.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
In early 1996, the Compensation Committee set the levels and types of
compensation for its executive officers for 1996 based generally upon (i)
perceived levels and types of compensation paid by the Company's competitors to
their executive officers, (ii) the desire to have some portion of each executive
officers' compensation be incentive in nature and (iii) an evaluation of each
executive officer's ability to contribute to the continued success of the
Company. In addition, certain components of several compensation packages
resulted from negotiations conducted in connection with the hiring of new
executive officers.
In determining appropriate compensation packages for employees, the
Compensation Committee has worked toward establishing an increasingly objective
policy which is designed to:
- Provide for an annual evaluation of the base salaries and
incentive compensation paid to key employees in an effort to
maintain the Company's competitive position;
- Emphasize the incentive aspect of compensation for sales
personnel by making the incentive element (primarily
commissions) comprise as much as 55% to 60% of the total
compensation package for such personnel;
- Motivate and reward officers and align their interests with
the interests of shareholders through the grant of stock
options; and
- Establish compensation packages such that the Company's key
employees are paid in the top one-half of the "market" for
comparable positions.
As noted above, the Compensation Committee annually evaluates and
adjusts, if necessary, the proportions of the base, short-term incentive and
long-term incentive compensation components of each officer's compensation
package to adjust for changes in the market for such officers' services and to
encourage desired individual performance modifications. Changes in total
compensation levels are made annually based on an assessment of each officer's
performance and the composition of the officer's current compensation package.
Such changes in annual compensation are effective on April 1 of each year.
Performance is judged according to the following criteria:
(1) The officer's ability to meet financial performance goals of
the Company for which he or she has significant
responsibility. Such goals are typically established at the
beginning of each year;
(2) The officer's ability to orchestrate projects and implement
strategies in a timely manner within his or her department or
functional unit;
(3) The officer's ability to use problem-solving, communication
and technical skills effectively, and
(4) The officer's ability to handle administrative matters and
relationships with other employees professionally.
6
<PAGE> 10
In light of the Company's compensation policy, the components of its
executive compensation program in 1997 will be base salaries, short-term
incentive awards in the form of cash bonuses or commissions and long-term
incentive awards in the form of stock options. The procedure used to determine
the level of each of these components of compensation is discussed in more
detail below.
Base Salaries. The Compensation Committee typically reviews various
studies and reports prepared for the Company by compensation consulting firms
regarding base salary levels for officers of other public companies in the
software industry holding the same or similar positions as the executive
officers of the Company. Although the data used by such compensation consultants
may be available publicly, the Compensation Committee uses such industry
information in the form provided by its compensation consultants in order to
take advantage of the analytical input provided by such consultants that makes
such industry information more directly applicable to the Company and the
functions performed by its executive officers. The Compensation Committee then
sets each officer's salary level based on the officer's experience level, the
scope and complexity of the position held (taking into account any changes to be
made) and the officer's performance during the past year. Generally, base
salaries are targeted to be in the 50 to 65 percentile range of compensation
paid by such other companies, although in certain instances base salaries may be
set higher in order to attract and retain exceptional employees.
Short-Term Incentive Compensation -- Bonuses and Commissions. The goal
of the short-term incentive component of the Company's compensation packages is
to place a significant portion of each officer's compensation at risk to
encourage and reward a high level of performance each year. For 1996 the
Compensation Committee first determined that the principal measure for
determining the incentive element of total compensation for most executive
officers should be increases in operating income (pre-tax and pre-investment
income or loss). The Committee then concluded that increasing bonus amounts
would be awarded for significant increases in operating income from 1995 to 1996
based upon a Board-approved 1996 Budget. The Company did not experience any such
increases in 1996 and, as a result, the corporate performance element of the
short-term incentive bonus package for most of the Company's executive officers
(which typically comprises 80% of an officer's short-term bonus potential) did
not result in the payout of any short-term incentive bonuses in 1996.
Generally, the Compensation Committee seeks to set short-term incentive
compensation levels at 20% to 30% of total compensation. The criteria for
earning bonuses differs slightly for each officer depending upon his or her
functional duties, but generally includes a Company-level financial performance
target (usually growth in operating income, as indicated above) and individual
performance objectives (not necessarily financial in nature).
Long-Term Incentive Compensation -- Stock Options. The goal of the
long-term incentive component of the Company's compensation packages is to
secure, motivate and reward officers and align their interests with the
interests of shareholders through the grant of stock options. Under the Option
Plan, the Compensation Committee is authorized to grant incentive and
non-qualified stock options to key employees. The number of options granted is
based on the position held by the individual, his or her performance, the prior
level of equity holdings by the officer and the Compensation Committee's
assessment of the officer's ability to contribute to the long-term success of
the Company. The Compensation Committee receives and takes into account data
provided by its compensation consultants regarding executives in comparable
positions and management's recommendations concerning proposed option grants. No
particular weight is given to any single factor. Options granted generally vest
in equal annual increments over a period of two to four years and terminate at
the end of 10 years. For a summary of option grants in 1996 to the Company's
named executive officers, see "Executive Compensation Tables - Table II - Option
Grants in 1996."
7
<PAGE> 11
Compensation of the Chief Executive Officer. Mr. Brock assumed the
positions of Chief Executive Officer and President in November 1994.
Compensation for Mr. Brock was established for 1996 in accordance with his
status as Chairman of the Board. His base salary for 1996 was $210,000. The
salary was based on the Compensation Committee's assessment of Mr. Brock's
contributions to the Company and his experience and capabilities in the
Company's industry. Mr. Brock did not receive any bonus in 1996. In July of
1996, Michael E. Kohlsdorf, the Chief Financial Officer, assumed the positions
of Chief Operating Officer and President. Mr. Kohlsdorf's salary remained the
same, and he was granted 100,000 options to vest over four years. Mr. Kohlsdorf
left the Company in September of 1996, at which time Mr. Brock resumed the
responsibilities of Chief Operating Officer and President. In December of 1996,
R. Douglas MacIntyre was hired by the Company into the position of Chief
Executive Officer and President. Mr. MacIntyre's salary was set at $200,000 with
a short term incentive of $100,000 annually, and a long-term incentive of
500,000 options. See "Executive Compensation Tables - Table II - Option Grants
in 1996" for details.
Limitations on Deductibility of Compensation. Under the Omnibus Budget
Reconciliation Act, a portion of annual compensation payable after 1993 to any
of the Company's five highest paid executive officers would not be deductible by
the Company for federal income tax purposes to the extent such officer's overall
compensation exceeds $1,000,000. Qualifying performance-based incentive
compensation, however, would be both deductible and excluded for purposes of
calculating the $1,000,000 base. Although the Compensation Committee has not and
does not presently intend to award compensation in excess of the $1,000,000 cap,
it will continue to address this issue when formulating compensation
arrangements for executive officers.
THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
Harry S. Gruner
Said Mohammadioun
James R. Porter
The report on executive compensation of the Board of Directors shall not
be deemed to be incorporated by reference as a result of any general
incorporation by reference of this Proxy Statement or any part hereof in the
Company's Annual Report to Shareholders or Form 10-K.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1996, the Compensation Committee of the Board of Directors
consisted of Messrs. Gruner, Mohammadioun and Porter, with Mr. Porter serving as
Chairman. None of such members serves or has served as an officer or employee of
the Company. No executive officer of any entity with an executive officer of the
Company serving as one of its directors served on the Company's Board of
Directors during 1996.
CERTAIN TRANSACTIONS
Other than compensation arrangements described elsewhere in this Proxy
Statement, during 1996, the Company was not a party to any transaction (or
series of transactions), nor did it have any relationship with any related party
requiring disclosure of such transaction or relationship under applicable SEC
disclosure rules.
EXECUTIVE COMPENSATION TABLES
The following tables set forth certain information required by the SEC
relating to various forms of compensation earned by the persons serving as Chief
Executive Officer ("CEO") of the Company during 1996 and the five other
executive officers whose total salary and bonus for 1996 equaled or exceeded
$100,000. Such six executive officers are hereinafter referred to as the
Company's "named executive officers."
8
<PAGE> 12
TABLE I - SUMMARY COMPENSATION TABLE
Table I presents the total compensation paid to or accrued by the
Company's named executive officers during 1994, 1995, and 1996.
<TABLE>
<CAPTION>
Annual Compensation
------------------- Long-Term
Other Annual Compensation(1) All Other
Salary Bonus Compensation Options Compensation(2)
Name and Position Year ($) ($) ($)(3) (#)(4) ($)
- ----------------- ---- --- --- ------ ------ ---
<S> <C> <C> <C> <C> <C> <C>
R. Douglas MacIntyre 1996 13,718 0 0 500,000 0
President and CEO
Richard T. Brock 1996 210,000 0 9,000 0 525
Chairman 1995 180,000 0 9,000 0 556
1994 170,000 0 -- 0 200
Wayne P. Webb 1996 93,917 90,510 76,987(7) 16,990 0
Vice President, 1995 85,000 100,000 63,437(7) 15,000 0
International Operations 1994 55,000 77,237 0 0 7,178(8)
David W. Deiters, Jr 1996 145,000 50,000 0 0 1,722
Former Vice President, 1995 39,038(5) 20,000 0 32,500 181
Services(6)
Michael E. Kohlsdorf 1996 118,144 0 -- 100,000 973
Former Chief Financial 1995 140,000 0 -- 0 933
Officer and Treasurer(6) 1994 138,250 40,000 -- 40,000 86
Stephen S. Andersen 1996 107,667 54,067 -- -- 1,184
Former Vice President, 1995 119,000 65,625 -- 45,000 281
Sales(6)
</TABLE>
- -------------------
(1) The Company did not award any restricted stock or other long-term
incentives other than stock options during 1995 or 1996. Accordingly,
columns relating to such awards have been omitted.
(2) Consists of Company matching contributions to the indicated person's
401 (k) plan account, except for Mr. Webb.
(3) Information with respect to certain perquisites and other personal
benefits awarded to the named executive officers has been omitted
because in each case, the aggregate value of these items is less than
$50,000 or 10% of the executive's annual salary and bonus for the years
reported above.
(4) See "Table II - Option Grants in 1996" for a description of the
material terms of the 1996 grants.
(5) Mr. Deiters was employed by the Company for only a portion of 1995.
(6) Messrs. Deiters, Kohlsdorf, and Andersen resigned their employment with
the Company in 1996.
(7) Consists of taxable fringe benefits relating to Mr. Webb's living
expenses in Germany.
(8) Gain on exercise of options.
9
<PAGE> 13
TABLE II - OPTION GRANTS IN 1996
Table II presents information regarding options granted to the Company's
named executive officers during 1996 to purchase shares of the Company's Common
Stock. The Company has no outstanding stock appreciation rights ("SARs") and
granted no SARs during 1996. In accordance with SEC rules, the table shows the
hypothetical "gains" or "option spreads" that would exist for the respective
options based on assumed rates of annual compound stock price appreciation of 5%
and 10% from the date the options were granted over the full option term.
Messrs. Brock, Deiters, and Andersen did not receive options during 1996 and
accordingly do not appear in the table below. Mr. Kohlsdorf left the Company in
1996 and, therefore, does not appear in the table below.
<TABLE>
<CAPTION>
Potential Realizable
Individual Grants Value at Assumed
-------------------------------------------------- Annual Rates of
Stock Price
No. of % of Total Appreciation for
Securities Options Exercise Option Term
Underlying Granted to or Base ---------------------------
Options Employees Price Expiration 5% 10%
Name Granted during Year ($/Share) Date ($) ($)
- ---- ---------- ----------- ------- ---------- --------- ---------
<S> <S> <C> <C> <C> <C> <C>
Mr. MacIntyre 250,000(1) 24.3 3.125 12/2/06 1,272,500 2,026,360
250,000(2) 24.3 3.125 12/2/06 1,272,500 2,026,360
Mr. Webb 16,990(1) 1.8 3.25 11/5/06 89,945 143,220
</TABLE>
- ----------------
(1) These options become exercisable in 25% increments on the first, second,
third and fourth anniversaries of the date of grant. Shares may be withheld
upon exercise to pay applicable withholding taxes. Under certain
circumstances, the options are subject to immediate vesting in the event of
a change of control of the Company.
(2) These options become exercisable in 20% increments when the Company's stock
price reaches $7.00, $10.00, $15.00, $20.00, and $25.00, respectively. In
any event, all options are exercisable in 5 years from date of grant.
During July and November of 1996 the Company provided holders of options
with exercise prices ranging from $6.50 to $21.50 and $4.52 to $4.75,
respectively, the election to reprice their options at the then current market
price. As a result of this election, 253,042 and 497,421 options were cancelled
and reissued in July and November, respectively, with an exercise price equal to
Fair Market Value on the date of re-issue. Options repriced in November included
those previously repriced in July. The vesting period of these options remained
unchanged. However, employees, excluding officers and directors, who elected to
reprice their options cannot exercise vested options until July 1997.
TABLE III - AGGREGATED OPTION EXERCISES IN 1996 AND 1996 YEAR-END OPTION VALUES
No options were exercised by the named executive officers during 1996.
10
<PAGE> 14
PERFORMANCE GRAPH
The following indexed line graph indicates the Company's total return to
shareholders from March 31, 1993, the date on which the Company's Common Stock
began trading on the Nasdaq National Market, to December 31, 1996, as compared
to total return for the Russell 2000 and Russell 2000-Technology indices for the
same period. The Russell 2000 index is comprised of the 2,000 publicly-traded
companies with market capitalizations (in terms of number of shares outstanding)
ranked immediately below the 1,000 companies with the highest market
capitalizations. The Russell 2000-Technology index is comprised of the 2,000
publicly-traded companies in the high-technology industry with market
capitalizations (in terms of number of shares outstanding) ranked immediately
below the 1,000 companies in the high-technology industry with the highest
market capitalizations.
11
<PAGE> 15
<TABLE>
<CAPTION>
March 31 December 31 December 31 December 31 December 31
1993 1993 1994 1995 1996
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Brock International Inc. 100 186 61 93 38
- ---------------------------------------------------------------------------------------------------------------------------
Russel 2000-Technology Index 100 124 141 210 233
- ---------------------------------------------------------------------------------------------------------------------------
Russel 2000 Index 100 114 112 114 167
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
Graph Produced by Research Data Group 06-March-97
336BZBRO
<PAGE> 16
OTHER MATTERS
The Board of Directors knows of no other matters to be brought before
the Annual Meeting. However, if any other matters are properly brought before
the Annual Meeting, the persons appointed in the accompanying proxy intend to
vote the shares represented thereby in accordance with their best judgment.
SOLICITATION OF PROXIES
The cost of the solicitation of proxies on behalf of the Company will be
borne by the Company. Certain directors, officers and other employees of the
Company may, without additional compensation except reimbursement for actual
expenses, solicit proxies by mail, in person or by telecommunication. The
Company will reimburse brokers, fiduciaries, custodians and other nominees for
out-of-pocket expenses incurred in sending the Company's proxy materials to, and
obtaining instructions relating to such materials from, beneficial owners.
INDEPENDENT AUDITORS
The firm of Price Waterhouse LLP served as the Company's independent
auditors for 1996 and the Board of Directors has reappointed this firm as the
Company's independent auditors for 1997. A representative of this firm is
expected to attend the Annual Meeting to respond to questions from shareholders
and to make a statement if he so desires.
SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Any proposal that a shareholder may desire to have included in the
Company's proxy material for presentation at the 1998 Annual Meeting must be
received by the Company at its executive offices at 2859 Paces Ferry Road, Suite
1000, Atlanta, Georgia 30339, Attention: Mr. R. Douglas MacIntyre, on or prior
to December 4, 1997.
ANNUAL REPORT
The Company's 1996 Annual Report to Shareholders (which is not part of
the Company's proxy soliciting material) is being mailed to the Company's
shareholders with this Proxy Statement.
April 4, 1997
Atlanta, Georgia
12
<PAGE> 17
APPENDIX
BROCK INTERNATIONAL, INC.
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF BROCK INTERNATIONAL, INC.
The undersigned shareholder(s) of Brock International, Inc., a Georgia
corporation (the "Company"), hereby acknowledges receipt of the Notice of Annual
Meeting of Shareholders and Proxy Statement, each dated April 4, 1997, and
hereby appoints Richard T. Brock and R. Douglas MacIntyre, or either of them,
proxies and attorneys-in-fact, with full power of substitution, on behalf and in
the name of the undersigned, to represent the undersigned at the 1997 Annual
Meeting of Shareholders of the Company to be held at 2:30 p.m. on Tuesday, May
6, 1997 at the Brock International Headquarters, Atlanta, Georgia, and at any
adjournment(s) thereof, and to vote all shares of Common Stock which the
undersigned would be entitled to vote if then and there personally present, on
the matters set forth below:
(1) To elect the nominees listed below to serve as directors of the Company for
the ensuing year:
Richard T. Brock, Harry S. Gruner, Said Mohammadioun, James R. Porter, and R.
Douglas MacIntyre.
<TABLE>
<S> <C>
[ ] FOR all nominees listed above [ ] WITHHOLD authority to vote for all nominees
(except as indicated to the contrary below) listed above.
</TABLE>
Instruction: To withhold authority for any individual nominee, mark "FOR" above,
and write the name of the nominee as to whom you wish to withhold authority in
the space below:
- --------------------------------------------------------------------------------
(2) In their discretion, upon such other matter or matters which may properly
come before the meeting or any adjournment(s) thereof.
PLEASE COMPLETE, DATE, SIGN AND RETURN THIS PROXY PROMPTLY. This Proxy, when
properly executed, will be voted in accordance with the directions given by the
undersigned shareholder(s). IF NO DIRECTION IS MADE, IT WILL BE VOTED FOR THE
DIRECTOR NOMINEES NAMED IN ITEM (1) ABOVE AND AS THE PROXIES DEEM ADVISABLE ON
SUCH OTHER MATTERS AS MAY COME BEFORE THE MEETING.
Dated , 1997
-------------------
-------------------------------
Signature
-------------------------------
Signature (if held jointly)
Title or authority (if
applicable)
NOTE: PLEASE SIGN EXACTLY AS NAME APPEARS HEREON. IF SHARES ARE REGISTERED IN
MORE THAN ONE NAME, THE SIGNATURE OF ALL PERSONS ARE REQUIRED. A CORPORATION
SHOULD SIGN IN ITS FULL CORPORATE NAME BY A DULY AUTHORIZED OFFICER, STATING HIS
OR HER TITLE. TRUSTEES, GUARDIANS, EXECUTORS AND ADMINISTRATORS SHOULD SIGN IN
THEIR OFFICIAL CAPACITY, GIVING THEIR FULL TITLE AS SUCH. IF A PARTNERSHIP,
PLEASE SIGN IN THE PARTNERSHIP NAME BY AN AUTHORIZED PERSON.
