SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
ESQUIRE COMMUNICATIONS LTD.
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:_________
(2) Aggregate number of securities to which transaction applies:____________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
_______________________________________________________________________
(4) Proposed maximum aggregate value of transaction:_______________________
(5) Total fee paid:___________________________________________________
[ ] Fee previously paid 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>
ESQUIRE COMMUNICATIONS LTD.
Notice of Special Meeting of Stockholders
to be held February 24, 1998
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of Esquire
Communications Ltd. (the "Company") will be held at ____________________, San
Diego, California, on February 24, 1998 at 9:30 in the morning for the following
purposes:
1. To authorize and approve an amendment to the Certificate of
Incorporation of the Company increasing the number of authorized shares of
Common Stock.
2. To transact such other business as may properly come before the
meeting, or any adjournment thereof.
Stockholders of record at the close of business on January 16, 1998,
shall be entitled to notice of, and to vote at, the meeting.
By order of the Board of Directors
Secretary
Dated: San Diego, California
January 26, 1998
IMPORTANT: PLEASE FILL IN, DATE, SIGN AND MAIL PROMPTLY THE ENCLOSED PROXY
IN THE POSTAGE-PAID ENVELOPE PROVIDED TO ASSURE THAT YOUR SHARES ARE REPRESENTED
AT THE MEETING.
<PAGE>
ESQUIRE COMMUNICATIONS LTD.
750 "B" Street
San Diego, California 92101
PROXY STATEMENT
The accompanying proxy is solicited by the Board of Directors of Esquire
Communications Ltd., a Delaware corporation (the "Company" or "Esquire"), for
use at the Special Meeting of Stockholders to be held on February 24, 1998, at
9:30 in the morning, or any adjournment thereof, at which stockholders of record
at the close of business on January 16, 1998, shall be entitled to vote. The
cost of solicitation of proxies will be borne by the Company. The Company may
use the services of its Directors, officers, employees and others to solicit
proxies, personally or by telephone; arrangements may also be made with
brokerage houses and other custodians, nominees, fiduciaries and stockholders of
record to forward solicitation material to the beneficial owners of stock held
of record by such persons. The Company may reimburse such solicitors for
reasonable out-of-pocket expenses incurred by them in soliciting, but no
compensation will be paid for their services. Any proxy granted as a result of
this solicitation may be revoked at any time before its exercise.
The date of this Proxy Statement is the approximate date on which this
Proxy Statement and form of proxy were first sent or given to stockholders.
If the accompanying proxy card is properly signed and returned to the
Company and not revoked, it will be voted in accordance with the instructions
contained therein. Unless contrary instructions are given, the persons
designated as proxy holders in the proxy card will vote for the amendment to the
Certificate of Incorporation of the Company and as recommended by the Board of
Directors with regard to all other matters or, if no such recommendation is
given, in their own discretion. Each stockholder may revoke a previously granted
proxy at any time before it is exercised by filing with the Secretary of the
Company a revoking instrument or a duly executed proxy bearing a later date. The
powers of the proxy holders will be suspended if the person executing the proxy
attends the Special Meeting in person and so requests. Attendance at the Special
Meeting will not, in itself, constitute revocation of a previously granted
proxy.
The presence at the Special Meeting, in person or by proxy, of the holders
of a majority of the votes entitled to be voted will constitute a quorum.
Abstentions and broker non-votes are counted for purposes of determining the
presence or absence of a quorum. On January 16, 1998, the Company had
outstanding and entitled to vote with respect to all matters to be acted upon at
the meeting _________ shares of Common Stock and ______ shares of Series A
Preferred Stock. Holders of record of outstanding shares of Common Stock and
Series A Preferred Stock will be entitled to vote together as a single class at
the Special Meeting. Each holder of Common Stock is entitled to one vote for
each share of stock held by such holder and each holder of Series A Preferred
Stock is entitled to 333 1/3 votes per share (the number of shares of Common
Stock into which it is convertible). Abstentions are counted in the calculation
of the votes cast with respect to any of the matters submitted to a vote of
stockholders, whereas broker non-votes are not counted for purposes of
determining whether a proposal has been approved.
It is expected that the following business will be considered at the
meeting and action taken thereon:
1. AMENDMENT TO CERTIFICATE OF INCORPORATION
Pursuant to Article FOURTH of its Certificate of Incorporation, the Company
is presently authorized to issue (a) 25,000,000 shares of Common Stock, par
value $.01 per share and (b) 1,000,000 shares of Preferred Stock, par value $.01
per share. It is proposed to amend the first paragraph of Article FOURTH of the
Certificate of Incorporation of the Company to read as set forth below in order
to increase the number of shares of Common Stock which the Company is authorized
to issue from 25,000,000 shares of Common Stock to 100,000,000 shares of Common
Stock:
<PAGE>
"FOURTH: The total number of shares of stock which
the Corporation is authorized to issue is 101,000,000
shares, of which 100,000,000 shares shall be designated
Common Stock, $.01 par value per share, and 1,000,000
shares shall be designated Preferred Stock, $.01 par
value per share."
At January 16, 1998, there were _________ shares of Common Stock issued and
outstanding and ______ shares were reserved for issuance upon exercise of stock
options and stock purchase warrants and conversion of Series A Preferred Stock
and Series B Preferred Stock. As the result, there are only ___________
authorized shares that would be available for future issuance by the Board of
Directors. The Board of Directors believes that it is in the best interests of
the Company and its stockholders to increase the number of authorized shares of
Common Stock, which shares would be available for issuance, in the discretion of
the Board, for any corporate purposes, including the acquisition of other
businesses, financing future growth, or other corporate purposes, without the
time consuming and costly need to hold a special meeting of stockholders in
every case.
The Company presently has signed letters of intent to acquire several court
reporting businesses. The purchase price to be paid in connection with such
acquisitions will consist of a combination of cash, promissory notes and shares
of Common Stock of the Company. Each of these letters of intent is preliminary
in nature and is subject to the satisfaction of various conditions. There is no
assurance that any of these transactions will be consummated. The Company also
intends to acquire other court reporting businesses. In order to obtain the cash
necessary for these acquisitions, the Company presently intends to sell either
debt or equity securities, including the possible underwritten public offering
of shares of its Common Stock. There is no assurance that any public sale will
be effectuated or the terms thereof. The Company is receptive to all methods of
financing which may be reasonably available and to all acquisition opportunities
which may arise from time to time. The Board of Directors believes that, in the
future, occasions may arise where the time required to obtain stockholder
approval might adversely delay the Company's ability to enter into a desirable
transaction. Authorized but unissued shares of Common Stock may be used by the
Company from time to time as appropriate and opportune situations arise.
Stockholders of the Company will not have any preemptive rights with
respect to the additional shares being authorized. No further approval by
stockholders would be necessary prior to the issuance of any additional shares
of Common Stock, except as may be required by law or applicable Boston Stock
Exchange or Nasdaq Stock Market rules. In certain circumstances, generally
relating to the number of shares to be issued and the identity of the recipient,
the rules of the Boston Stock Exchange and the Nasdaq Stock Market require
stockholder authorization in connection with the issuance of such additional
shares. Subject to law and the rules of the Boston Stock Exchange and the Nasdaq
Stock Market, the Board of Directors has the sole discretion to issue additional
shares of Common Stock on such terms and for such consideration as may be
determined by the Board of Directors. The issuance of any additional shares of
Common Stock would have the effect of diluting the percentage of stock ownership
and voting rights of the present stockholders of the Company.
Under Delaware law, the affirmative vote of the holders of a majority of
the voting power of the Company entitled to notice of, and to vote at, this
Special Meeting is required to adopt the proposed amendment to Article FOURTH.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE AUTHORIZATION AND APPROVAL
OF THIS PROPOSAL.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to
beneficial ownership of Common Stock at December 31, 1997 by (i) each person
known by the Company to beneficially own more than five percent of outstanding
Common Stock, (ii) each Director of the Company, (iii) each of the most highly
compensated executive officers of the Company in 1996, and (iv) all Directors
and executive officers of the Company as a group. Except as noted below, each
person or entity has sole voting and investment power with respect to all shares
listed as owned by such person or entity.
NAME AND ADDRESS NUMBER PERCENT OF CLASS
Malcolm L. Elvey(1)
216 East 45th Street
New York, NY 10017 841,000 12.0%
The Sarnoff Trust(2)
2100 Broadway
Santa Ana, CA 92706 750,000 11.1%
David J. Feldman(3)
216 East 45th Street
New York, NY 10017 620,900 9.0%
Allied Investment Corporation(4)
Allied Investment Corporation II
Allied Capital Corporation II
1666 K Street
Washington, DC 20006 625,000 8.5%
CMNY Capital, L.P.(5)
135 E. 57th Street
New York, NY 10022 472,500 7.0%
Mortimer R. Feinberg --- ---
Andrew P. Garvin 400(7) *
Golder, Thoma, Cressey,
Rauner Fund IV, L.P. (6) 4,874,950 41.9%
Debra Neiderfer(8) 63,667 *
Joseph P. Nolan (6) --- ---
Bruce V. Rauner (6) --- ---
Cary A. Sarnoff(9) 883,500 12.8%
Paul M. Strohfus(10) 19,167 *
John C. Durham 284,775 4.2%
Harlingwood & Company LLC(11) 500,000 7.2%
Fir M. Geenen(11) 500,000 7.2%
David A. White(11) 500,000 7.2%
All directors and executive
officers as a group
(13 persons)(12) 3,375,675 44.0%
- - ------------------
* Less than 1%
(1) Includes options to purchase 275,000 shares of the Company's Common
Stock granted to Mr. Elvey under the Plan.
(2) The Sarnoff Trust is a revocable trust of which Cary A. Sarnoff and his
wife, Michelle A. Sarnoff, are settlors, trustees and beneficiaries.
(3) Includes options to purchase 125,000 shares of the Company's Common
Stock granted to Mr. Feldman under the Plan.
(4) These entities in the aggregate own warrants to purchase an aggregate
of 625,000 shares of Common Stock at an exercise price of $2.90 per
share, subject to adjustment.
(5) Robert Davidoff and Edwin Marks are the general partners of CMNY
Capital, L.P. and may be deemed to control it.
(6) GTCR is the direct owner of 14,625 shares of Series A
Convertible Preferred Stock which is convertible into
4,874,950 shares of Common Stock. GTCR IV, L.P., a limited
partnership, is the general partner of GTCR and Golder,
Thoma, Cressey, Rauner, Inc. ("GTCR Inc.") is the general
partner of GTCR IV, L.P. As such they may be deemed to be
the indirect beneficial owners of such securities. Messrs.
Nolan and Rauner are principals of GTCR Inc.
(7) Includes warrants to purchase 200 shares of Common Stock.
(8) Includes options to purchase 41,667 shares of the Company's Common
Stock granted to Ms. Neiderfer under the Plan.
(9) Includes shares owned by The Sarnoff Trust, warrants to purchase 7,600
shares of Common Stock owned by Mr. Sarnoff and options to purchase
125,000 shares of the Company's Common Stock granted to Mr. Sarnoff
under the Plan. See Note (2).
(10) Includes options to purchase 16,667 shares of the Company's Common
Stock granted to Mr. Strohfus under the Plan.
(11) Messrs. Geenen and White are officers of Harlingwood & Company, LLC, a
company which owns 350,000 shares of Common Stock and options to
purchase 150,000 shares of Common Stock.
(12) Includes warrants to purchase 7,800 shares of Common Stock and options
to purchase 920,000 shares of Common Stock granted under the Plan.
OTHER MATTERS
At the date of this Proxy Statement, the only business which the Board of
Directors intends to present or knows that others will present at the meeting is
that hereinabove set forth. If any other matter or matters are properly brought
before the meeting, or any adjournment thereof, it is the intention of the
persons named in the accompanying form of proxy to vote the proxy on such
matters in accordance with their judgment.
MISCELLANEOUS
Proposals of stockholders intended to be presented at the Company's 1998
Annual Meeting of Stockholders must be received by the Company on or prior to
February 25, 1998, to be eligible for inclusion in the Company's Proxy Statement
and form of proxy to be used in connection with the 1998 Annual Meeting.
By order of the Board of Directors
Secretary
Dated: January 26, 1998
<PAGE>
ESQUIRE COMMUNICATIONS LTD.
1998 Special Meeting of Stockholders - February 24, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
P The undersigned stockholder of ESQUIRE COMMUNICATIONS LTD., a Delaware
R corporation, hereby appoints Malcolm L. Elvey, David A. White and
O David A. Higson, and each of them the proxies of the undersigned with
X full power of subsitution to vote at the Special Meeting of Stockholders
Y of the Company to be held at 9:30 a.m. on February 24, 1998, and at any
adjournment or adjournments thereof (the "Meeting"), with all power
which the undersigned would have if personally present, hereby revoking
any proxy heretofore given. The undersigned hereby acknowledges receipt
of the proxy statement for the meeting and instructs the proxies to vote
as directed on the reverse side.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL PROPOSALS.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
SEE REVERSE SIDE
<PAGE>
THIS PROXY, WHEN PROPERLY SIGNED, WILL BE VOTED IN THE MANNER DIRECTED. IF
NO SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED FOR THE AMENDMENT TO THE
CERTIFICATE OF INCORPORATION AND IN THE DISCRETION OF THE PROXY HOLDERS AS
TO ANY OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING.
1. To approve the Amendment to the 2. With discretionary authority upon
Certificate of Incorporation such other matters as may
FOR AGAINST ABSTAIN properly come before the Meeting.
/ / / / / /
Please sign exactly as your name
appears on this proxy card. When
signing as attorney, executor,
trustee or guardian, please give
your full title.
Signature_______________ Date_____
