SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
E. W. BLANCH HOLDINGS, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(2) or Item 22(a)(2) of
Schedule 14A.
[ ] 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 transactions 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:
E.W. BLANCH HOLDINGS, INC.
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3500 West 80th Street
Minneapolis, Minnesota 55431
March 24, 1997
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of E.
W. Blanch Holdings, Inc. to be held at the Hyatt Regency Hill Country Resort,
9800 Hyatt Resort Drive, San Antonio, Texas 78251, on Thursday, April 24,
1997, at 10:30 A.M. Central Daylight Time. I encourage you to attend. Whether
or not you plan to attend the meeting, I urge you to vote your proxy. On
behalf of your Board of Directors, thank you for your continued support of
and interest in E. W. Blanch Holdings, Inc.
Sincerely,
/s/ Edgar W. Blanch, Jr.
Edgar W. Blanch, Jr.
Chairman and Chief Executive Officer
E. W. BLANCH HOLDINGS, INC.
3500 WEST 80TH STREET
MINNEAPOLIS, MINNESOTA 55431
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
APRIL 24, 1997
---------------------
Notice is hereby given that the Annual Meeting of Shareholders of E. W.
Blanch Holdings, Inc. (the "Company") will be held at the Hyatt Regency Hill
Country Resort, 9800 Hyatt Resort Drive, San Antonio, Texas 78251, on
Thursday, April 24, 1997, at 10:30 A.M. Central Daylight Time for the
following purposes:
1. To elect two Class I directors to serve until the Annual
Meeting of Shareholders in 2000 and until their respective
successors are duly elected and qualified;
2. To approve the E. W. Blanch Holdings, Inc. Restricted Stock
Incentive Plan;
3. To approve the E. W. Blanch Holdings, Inc. Management
Incentive Plan;
4. To approve an amendment to the Employee Stock Purchase Plan;
5. To approve an amendment to the E. W. Blanch Holdings, Inc.
1993 Stock Incentive Plan;
6. To ratify the appointment of Ernst & Young LLP as the
Company's independent auditors for the 1997 fiscal year; and
7. To act upon any other business that may properly be brought
before the Annual Meeting.
The close of business on March 3, 1997 has been fixed as the record date for
determining the shareholders entitled to notice of and to vote at the Annual
Meeting.
Your attention is directed to the accompanying Proxy Statement.
WHETHER OR NOT YOU PLAN TO BE PRESENT AT THE ANNUAL MEETING, PLEASE COMPLETE,
DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
Enclosed for your information is the Company's Annual Report for the year
ended December 31, 1996.
By Order of the Board of Directors
/s/ Daniel P. O'Keefe
Daniel P. O'Keefe
SECRETARY
March 24, 1997
E. W. BLANCH HOLDINGS, INC.
3500 WEST 80TH STREET
MINNEAPOLIS, MINNESOTA 55431
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PROXY STATEMENT
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ANNUAL MEETING OF SHAREHOLDERS
APRIL 24, 1997
INFORMATION CONCERNING SOLICITATION AND VOTING
The enclosed proxy is solicited by the Board of Directors of E. W. Blanch
Holdings, Inc. (the "Company") for use at the Annual Meeting of Shareholders,
which will be held at 10:30 A.M. Central Daylight Time on Thursday, April 24,
1997, at the Hyatt Regency Hill Country Resort, 9800 Hyatt Resort Drive, San
Antonio, Texas 78251, and at any adjournment thereof.
The Board of Directors is aware of six items of business to be considered at
the Annual Meeting: (1) the election of two Class I directors to serve until
the Annual Meeting of Shareholders in 2000 and until their respective
successors are duly elected and qualified; (2) approval of the E. W. Blanch
Holdings, Inc. Restricted Stock Incentive Plan; (3) approval of the E. W.
Blanch Holdings, Inc. Management Incentive Plan; (4) approval of an amendment
to the Employee Stock Purchase Plan; (5) approval of an amendment to the
Company's 1993 Employee Stock Incentive Plan; and (6) ratification of the
appointment of Ernst & Young LLP as the Company's independent auditors for
the 1997 fiscal year. The Board of Directors knows of no matters to be
presented for action at the Annual Meeting other than those mentioned above.
However, if any other matters properly come before the Annual Meeting, the
persons named in the proxy will vote on such other matters and/or for other
nominees in accordance with their best judgment. The Board of Directors
recommends that an affirmative vote be cast in favor of all of the proposals
listed above.
The giving of a proxy does not preclude a shareholder from voting in person
at the Annual Meeting. The proxy is revocable before its exercise by
delivering either written notice of such revocation or a later dated proxy to
the Secretary of the Company at its executive office at any time prior to
voting of the shares represented by the earlier proxy. In addition,
shareholders attending the Annual Meeting may revoke their proxies by voting
at the Annual Meeting. All returned proxies that are properly signed and
dated will be voted as the shareholder directs. If no direction is given,
executed proxies will be voted FOR election of the Class I directors named
herein, FOR approval of the Restricted Stock Incentive Plan, FOR approval of
the Management Incentive Plan, FOR approval of an amendment to the Employee
Stock Purchase Plan, FOR approval of the amendment to the 1993 Stock
Incentive Plan, and FOR ratification of the appointment of Ernst & Young LLP
as the Company's independent auditors for the 1997 fiscal year.
Only shareholders of record at the close of business on March 3, 1997 are
entitled to vote at the Annual Meeting or any adjournment thereof. As of said
date, 12,561,266 shares of the Company's common stock, $.01 par value per
share (the "Common Stock"), were outstanding and entitled to one vote per
share on all matters submitted to shareholders. A list of shareholders will
be available for inspection for at least ten days prior to the Annual Meeting
at the principal executive offices of the Company at 3500 West 80th Street,
Minneapolis, Minnesota 55431 and at the Annual Meeting.
This proxy solicitation material is being mailed on or about March 24, 1997
to shareholders as of the record date with a copy of the Company's 1996
Annual Report to Shareholders, which includes financial statements for the
period ended December 31, 1996.
Proxies will be voted at the Annual Meeting, or at any adjournment thereof,
at which a quorum is present, in accordance with the directions on the proxy
card. The holders of a majority of the Common Stock outstanding and entitled
to vote who are present either in person or represented by proxy will
constitute a quorum for the Annual Meeting.
Directors are elected by a plurality of the votes cast. "Plurality" means
that the individuals who receive the largest number of votes cast "For" are
elected as directors up to the maximum number of directors to be chosen at
the Annual Meeting. Consequently, any shares not voted "For" a particular
director (whether as a result of a direction to withhold or a broker nonvote)
will not be counted in such director's favor.
All other matters to be acted on at the Annual Meeting require the
affirmative vote of a majority of the shares present at the meeting, in
person or by proxy, to constitute the action of the shareholders. If an
executed proxy card is returned and the shareholder has voted "abstain" on
any matter (or "withhold authority" as to the election of any Director), the
shares represented by such proxy will be considered present at the meeting
for purposes of determining a quorum and for purposes of calculating the
vote, but will not be considered to have been voted in favor of such matter.
If an executed proxy is returned by a broker holding shares in street name
which indicates that the broker does not have discretionary authority as to
certain shares to vote on one or more matters, such shares will be considered
present at the meeting for purposes of determining a quorum, but will not be
considered to be represented at the meeting for purposes of calculating the
vote with respect to such matters.
The expense of preparing, printing and mailing this Proxy Statement will be
paid by the Company.
ELECTION OF DIRECTORS
The Board of Directors is divided into three classes, being divided as
equally as possible and each class having a term of three years. Each year
the term of office of one class expires. This year the term of a class
consisting of two Directors expires. It is the intention of the Board that
the shares represented by proxy, unless otherwise indicated thereon, will be
voted for the reelection of Joseph D. Sargent and Frank S. Wilkinson, Jr. as
Directors to hold office for a term of three years until the Annual Meeting
of Shareholders in 2000 and until their respective successors are duly
elected and qualified.
The persons designated as proxies reserve full discretion to cast votes for
other persons in the event any such nominee is unable to serve. However, the
Board of Directors has no reason to believe that any nominee will be unable
to serve if elected. The election of Directors requires a plurality of the
votes cast at the Annual Meeting, in person or by proxy. The proxies cannot
be voted for a greater number of persons than the two named nominees.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR EACH OF THE
NOMINEES.
The following sets forth information regarding each nominee and the remaining
Directors who will continue in office after the Annual Meeting.
NOMINEES FOR CLASS I DIRECTORS
(TERMS EXPIRING IN 2000)
JOSEPH D. SARGENT (67)--Mr. Sargent has served as a Director of the Company
since April 1993. Mr. Sargent has served as Chairman of Connecticut Surety
Corporation since January 1993. Mr. Sargent served as the Chief Executive
Officer of Conning & Company from 1970 to 1990 and as Vice Chairman until
1993. Connecticut Surety Corporation is a surety operation formed in
conjunction with the venture capital operations of Conning & Company. Mr.
Sargent is also the former Chairman of S-K-I Ltd., the largest publicly held
ski resort in the United States. He currently serves as a director of MMI
Companies, Inc., Trenwick Group, Inc., Policy Management Systems Corporation,
Mutual Risk Management Ltd. and Executive Risk, Inc.
FRANK S. WILKINSON, JR. (57)--Mr. Wilkinson has served as Executive Vice
President and a Director of the Company since its formation in March 1993.
Mr. Wilkinson has been associated with predecessors of the Company since
1969. From 1979 to 1993, he served as Executive Vice President of those
predecessors. He is currently serving as Chairman of the Board and Chief
Executive Officer of the Company's wholly owned subsidiaries, Paragon
Reinsurance Risk Management Services, Inc. and E. W. Blanch Capital Risk
Solutions, Inc.
CLASS II DIRECTORS
(TERMS EXPIRING IN 1998)
JAMES N. LAND, JR. (67)--Mr. Land has served as a Director of the Company
since April 1993 and as a corporate financial consultant to a number of
companies since October 1976. Mr. Land currently serves on the Board of
Directors of Raytheon Company. In addition, Mr. Land served on the Executive
Committee of the Board of Directors of The First Boston Corporation from 1967
to 1976.
CHRIS L. WALKER (39)--Mr. Walker has served as President and Chief Operating
Officer of the Company since July 1995, as Executive Vice President from
March 1993 to July 1995 and as a Director of the Company since October 1994.
Mr. Walker has been associated with predecessors of the Company since 1980.
From 1985 to 1990, he served as Vice President, from 1990 to 1993, he served
as Senior Vice President, and from February 1993 to March 1993, he served as
Executive Vice President of those predecessors. He is currently serving as
Chairman of the Board and Chief Executive Officer of the Company's wholly
owned subsidiary, E. W. Blanch Co., Inc.
PAUL B. INGREY (57)--Mr. Ingrey has served as a Director of the Company since
January 1997. Mr. Ingrey recently retired from F&G Re, which he helped found
and where he served as Chairman of the Board and Chief Executive Officer from
January 1996 until his retirement. Prior to 1996, Mr. Ingrey served as
President of F&G Re. F&G Re is a reinsurance company and a division of United
States Fidelity and Guaranty Company.
CLASS III DIRECTORS
(TERMS EXPIRING IN 1999)
EDGAR W. BLANCH, JR. (60)--Mr. Blanch has served as Chief Executive Officer
and Chairman of the Board of Directors of the Company since its formation in
March 1993. Mr. Blanch has been associated with predecessors of the Company
since 1958. From 1976 to 1993, he served as Chief Executive Officer of those
predecessors.
WILLIAM B. MADDEN (58)--Mr. Madden has served as a Director of the Company
since April 1993 and as the President of Madden Securities Corporation, a
general securities and investment banking firm, since 1986. Mr. Madden
currently is the Chairman of the Board of Directors of Mercantile Bank and
Trust and serves as a director of Pillowtex Corporation.
STEVEN G. ROTHMEIER (50)--Mr. Rothmeier has served as a Director of the
Company since April 1993 and as Chairman of the Board of Directors and Chief
Executive Officer of Great Northern Capital Corporation, a private investment
management and merchant banking firm, since March 1993. Mr. Rothmeier served
as President of IAI Capital Group, a venture capital and merchant banking
firm, from 1989 to 1993 and as Chairman of the Board of Directors and Chief
Executive Officer of NWA, Inc. and Northwest Airlines Inc. from 1985 to 1989.
Mr. Rothmeier currently is a director of Honeywell Inc., Department 56, Inc.,
Precision Castparts Corp., and WMX Technologies, Inc.
BOARD OF DIRECTORS AND COMMITTEES
Compensation Committee
The Compensation Committee of the Board of Directors (the "Compensation
Committee") consists of Messrs. Ingrey, Land, Madden, Rothmeier and Sargent.
The Compensation Committee determines the compensation for executive officers
of the Company and establishes the Company's compensation policies and
practices. The Compensation Committee also grants awards under the Company's
stock incentive plan.
AUDIT COMMITTEE
The Audit Committee of the Board of Directors (the "Audit Committee")
consists of Messrs. Ingrey, Land, Madden, Rothmeier and Sargent. The Audit
Committee submits recommendations to the Board of Directors with respect to
the selection of the Company's independent auditors and with respect to any
other matters it deems appropriate. It reviews the annual financial
statements of the Company with the Company's independent auditors, the
practices and procedures adopted by the Company in the preparation of such
statements and the independent auditor's annual scope of audit.
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
During the fiscal year ended December 31, 1996, the Board of Directors held
eight meetings, the Compensation Committee held four meetings and the Audit
Committee held four meetings. All Directors attended more than 75% of the
meetings of the Board of Directors and committees on which they served.
DIRECTORS' COMPENSATION
Directors of the Company who are not officers or employees of the Company
receive a fee of $6,000 per quarter plus $1,000 per meeting, including
committee meetings, attended. Directors of the Company who are officers or
employees of the Company do not receive additional compensation for their
services as a Director. No Director receives additional compensation for
serving on a committee other than the fee for attendance at committee
meetings. Directors of the Company who are not officers or employees of the
Company may elect to receive their fees in the form of Common Stock of the
Company, or to defer receipt of such fees and have the deferred amounts
treated as if invested in Common Stock, pursuant to the Company's
Non-Employee Directors' Stock Plan.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information regarding the beneficial
ownership of Common Stock as of March 3, 1997: (i) by each Director; (ii) by
each of the executive officers included in the Summary Compensation Table set
forth under the caption "Executive Compensation;" (iii) by all Directors and
executive officers of the Company as a group; and (iv) by each person known
to the Company to be the beneficial owner of more than 5% of the outstanding
shares of Common Stock. Except as otherwise indicated, the named beneficial
owner has sole voting and investment power with respect to the shares held by
such beneficial owner.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OF CLASS
- ------------------------ -------------------- ----------------
<S> <C> <C>
Edgar W. Blanch, Jr. 678,253(1) 4.79%
Paul B. Ingrey 21,500(2) *
James N. Land, Jr. 5,000 *
William B. Madden 1,000 *
Steven G. Rothmeier 4,000 *
Joseph D. Sargent 3,500 *
Chris L. Walker 214,764 1.52%
Frank S. Wilkinson, Jr. 686,373(3) 4.85%
Tom S. Nelson 55,068(4) *
Ian David Packer 2,500 *
All directors and executive officers
as a group (10 persons) 1,671,958 11.82%
Quest Advisory Corp. 848,000(5) 5.99%
1414 Avenue of the Americas
New York, NY 10019
</TABLE>
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* Indicates ownership of less than 1% of the outstanding Common Stock.
(1) Includes 71,660 shares of Common Stock beneficially owned by the Christina
Sozio Blanch Trust and which, due to Mr. Blanch's position as trustee of
such Trust, may be deemed to be beneficially owned by him.
(2) Includes 10,000 shares of Common Stock beneficially owned by a family trust
and which, due to Mr. Ingrey's position as trustee of such trust, may be
deemed to be beneficially owned by him.
(3) Includes 7,400 shares of Common Stock beneficially owned by charitable and
minors' trusts and which, due to Mr. Wilkinson's position as trustee of such
trusts, may be deemed to be beneficially owned by him.
(4) Includes 25,000 shares of Common Stock beneficially owned by Mr. Nelson's
spouse as to which he disclaims beneficial ownership.
(5) Based on a Schedule 13G dated February 3, 1997 prepared by Quest Advisory
Corp.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
Directors and Executive officers to file reports of ownership and changes in
ownership of the Company's Common Stock with the Securities and Exchange
Commission and the New York Stock Exchange, and the Company is required to
identify any of those individuals who failed to file such reports on a timely
basis. The Company believes that during 1996 all directors and executive
officers of the Company complied with their Section 16(a) filing
requirements, except that the Form 3 Initial Statement of Beneficial
Ownership was filed late for Mr. Packer.
EXECUTIVE COMPENSATION
The following table sets forth information regarding the compensation of the
Chief Executive Officer and the four other most highly compensated executive
officers of the Company for each of the last three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION ------------
---------------------------------------------- SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS(#) COMPENSATION
- --------------------------- ---- ------ ----- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Edgar W. Blanch, Jr. 1996 $895,000 $ -- $25,000(1) -- $76,813(2)
Chairman of the Board, 1995 $895,000 $ -- $ 7,043 -- $73,335
Chief Executive Officer 1994 $895,000 $200,000 $25,000 -- $73,335
and Director
Frank S. Wilkinson, Jr. 1996 $437,380 $ 31,250 $20,000(1) -- $39,014(2)
Executive Vice President 1995 $437,380 $ 31,250 $ 7,116 -- $39,014
and Director 1994 $437,380 $137,500 $ 4,360 -- $39,014
Chris L. Walker 1996 $475,000 $ -- $ 2,000(1) 40,000 $36,498(2)
President, Chief Operating 1995 $416,667 $ -- $ 250 30,000 $45,727
Officer and Director 1994 $275,000 $200,000 -- -- $41,535
Ian D. Packer(3) 1996 $150,000 $ -- $19,919(1) -- $ 311(2)
Executive Vice President
and Chief Financial Officer
Tom S. Nelson 1996 $250,000 $ -- $ 1,200(1) -- $20,158(2)
Executive Vice President 1995 $250,000 $ -- $ 250 30,000 $20,012
and Chief Accounting 1994 $175,000 $ 79,000 -- -- $13,753
Officer
</TABLE>
- ------------------
(1) "Other Annual Compensation" includes: (a) financial planning and tax
preparation fees, with respect to Messrs. Blanch, Wilkinson, Walker and
Nelson and (b) reimbursements of taxable income incurred in relocation
expenses, with respect to Mr. Packer.
(2) "All Other Compensation" for 1996 includes:
(a) Contribution at 7.5% of salary pursuant to the Company's retirement
plan, subject to the Internal Revenue Code limitation of $11,250, with
the remainder being paid in cash to Mr. Blanch ($55,875), Mr.
Wilkinson ($21,554), Mr. Walker ($24,375) and Mr. Nelson ($7,500).
(b) Group term life taxable income with regard to Mr. Blanch ($9,688), Mr.
Wilkinson ($6,210), Mr. Walker ($873), Mr. Packer ($311), and Mr.
Nelson ($1,408).
(3) Mr. Packer was hired on July 1, 1996.
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
------------------------------------------------------------ ANNUAL RATES OF
NUMBER OF % OF TOTAL STOCK PRICE
SECURITIES OPTIONS/SARS APPRECIATION
UNDERLYING GRANTED TO EXERCISE OR FOR OPTION TERM
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION ---------------
GRANTED (#) FISCAL YEAR ($/SH) DATE 5% 10%
----------- ----------- ------ ---- -- ---
<S> <C> <C> <C> <C> <C> <C>
Edgar W. Blanch, Jr. -- -- -- -- -- --
Frank S. Wilkinson, Jr. -- -- -- -- -- --
Chris L. Walker(1) 25,000 10.46% $22.75 1/25/06 $352,594 $898,336
15,000 6.28% $22.00 4/25/06 $158,668 $448,123
Tom S. Nelson -- -- -- -- -- --
Ian D. Packer -- -- -- -- -- --
</TABLE>
- -------------------
(1) Options vest one-third after three years from date of grant, and one-third
after the fourth and fifth years from date of grant. Options are subject to
tax withholding at the time of exercise. Vesting of non-vested options
accelerates in the event of a change in control.
AGGREGATE OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED IN-THE-
UNEXERCISED OPTIONS/SARS AT FY-END(#) MONEY OPTIONS/SARS AT FY-END ($)
------------------------------------- --------------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE(1)
----------- ------------- ----------- ----------------
<S> <C> <C> <C> <C>
Edgar W. Blanch, Jr. -- -- -- --
Frank S. Wilkinson, Jr. -- -- -- --
Chris L. Walker 9,990 90,010 $16,234 $32,516
Tom S. Nelson 6,660 43,340 $10,823 $21,678
Ian D. Packer -- -- -- --
</TABLE>
- --------------------
(1) Based on $20.125 per share, which was the closing price of a share of the
Common Stock on the New York Stock Exchange on December 31, 1996.
EMPLOYMENT AGREEMENTS
On May 6, 1993, the Company entered into employment agreements (the "Employment
Agreements") with Messrs. Blanch, Wilkinson, Walker and Nelson (each, an
"Executive"). The Employment Agreements provide for an initial term of three
years and are renewable thereafter on a month-to-month basis. The Employment
Agreements provide for a minimum annual salary as follows: Mr. Blanch, $895,000;
Mr. Wilkinson, $437,380; Mr. Walker, $275,000; and Mr. Nelson, $175,000.
Pursuant to the terms of the Employment Agreements, each Executive is
prohibited from competing against the Company for a period ending two years
after the termination of the Executive's employment with the Company.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board has the overall responsibility for
compensation actions affecting the Company's executive officers. The
Compensation Committee's responsibilities include approving base and
incentive compensation. The Compensation Committee is comprised entirely of
Directors who are neither current nor former employees of the Company. There
are no compensation committee interlocks, i.e., no executive officer of the
Company serves as a member of the board of directors or compensation
committee of another entity that has an executive officer serving on the
Board or the Compensation Committee.
The goal of the Company's executive compensation program is to encourage
performance, as well as to attract and retain the management talent required
to operate the Company successfully. The program has also been designed to
create a strong and direct link between the compensation of the Company's
executive officers, on the one hand, and the Company's long range success and
shareholder value, on the other hand.
BASE COMPENSATION
The Committee reviews and approves annually all salary increases for
executive officers. As discussed above, minimum annual base salaries were
established pursuant to the Employment Agreements that were entered into with
certain executive officers at the time of the Company's initial public
offering in 1993. Base salaries are adjusted in the discretion of the
Committee based on the level of responsibility and the individual performance
of each officer. Determinations with respect to base salaries are primarily
subjective and are not targeted to any specific criteria.
During 1996, the Company paid base compensation to each of the executive
officers as follows: Mr. Blanch, $895,000; Mr. Wilkinson, $437,380; Mr.
Walker, $475,000; Mr. Nelson, $250,000; and Mr. Packer, $150,000. Mr.
Packer's base compensation reflects a hire date of July 1, 1996. No increases
in base compensation for executive officers have been approved, or are
presently contemplated, for 1997, except that it is expected Mr. Blanch's
compensation will be increased to $1 million, subject to potential
restrictions and deferrals in order to comply with Section 162(m) of the
Internal Revenue Code (the "Code").
INCENTIVE COMPENSATION
The incentive compensation for executive officers of the Company is
principally derived from the Company's Management Incentive Plan. The
Management Incentive Plan is a cash bonus plan designed to reward the
executive officers for exceptional performance based on the achievement of
annual Company performance goals. In order for participants to earn an award,
the Company's growth in revenues and net income must exceed predefined
amounts. Revenues for the year ended December 31, 1996 were $109.0 million,
representing a 14.9% increase over 1995 revenues. Net income for the year
ended December 31, 1996 was $6.3 million, representing a 65.4% decrease over
1995 net income. This financial performance by the Company resulted in an
aggregate Management Incentive Plan bonus pool of $349,000, none of which was
distributed.
The Chairman of the Board and Chief Executive Officer, after consulting with
the other members of the executive officer group, makes a recommendation to
the Compensation Committee regarding the allocation of the bonus pool among
the executive officers. The Compensation Committee approves the actual
allocation of bonuses under the Plan. For 1996, the Chairman of the Board and
Chief Executive Officer recommended that no bonuses be allocated pursuant to
the Management Incentive Plan.
STOCK BASED COMPENSATION
The Committee believes that ownership of the Company's Common Stock by
management can effectively motivate the building of shareholder wealth by
aligning the interests of management with those of the Company's shareholders.
Stock based compensation for executive officers of the Company has historically
taken the form of stock options. To supplement the use of stock options, the
shareholders of the Company are being asked to approve at the Annual Meeting the
Restricted Stock Incentive Plan, which is described in detail on page 9 of this
Proxy Statement.
The Committee's determinations with regard to stock option grants to executive
officers are based primarily on the officer's level of stock ownership, level of
responsibility and individual performance. In 1996, the Committee granted stock
options for 40,000 shares to Mr. Walker based on the foregoing criteria.
RETIREMENT BENEFITS
Executive officers also participate in the Company's retirement plan which
provides that 7.5% of the first $150,000 of compensation (which is the Code
compensation limit for retirement plans) be contributed to the Company's
retirement plan, and that 7.5% of the compensation in excess of the $150,000
Code limit be paid by the Company as a cash award.
CEO COMPENSATION
Mr. Blanch has served as CEO of the Company since its formation in March
1993. Based on the Stock Performance Graph below, the Company's shareholders
have received a total return (consisting of appreciation in the price of the
Common Stock and assuming the reinvestment of all dividends) of 15.5% from
May 6, 1993 through December 31, 1996. The base salary for Mr. Blanch has not
increased during that time. However, he has received incentive compensation
under the Company's Management Incentive Plan and also receives benefits
pursuant to the Company's retirement plan. The Compensation Committee did not
approve a bonus for Mr. Blanch under the 1996 Management Incentive Plan, at
Mr. Blanch's request, even though he could have been awarded up to $174,500.
Based on his annual performance review, it is expected that Mr. Blanch's base
salary will be increased to $1 million for 1997, subject to potential
restrictions and deferrals in order to comply with Section 162(m) of the
Code.
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(m)
Section 162(m) of the Code, enacted in 1993, generally disallows a tax
deduction to public companies for compensation over $1 million paid to the
Company's Chief Executive Officer and four other most highly compensated
executive officers. Qualifying "performance-based compensation" and
compensation paid pursuant to plans adopted prior to a company's initial
public offering of securities will not be subject to the deduction limit if
certain requirements are met. The Company currently intends to structure the
compensation of its executive officers in a manner that avoids the deduction
limits of Section 162(m). Accordingly, in order to comply with the
shareholder approval requirements for "performance-based compensation", the
Company is submitting for shareholder approval its Management Incentive Plan
and its Restricted Stock Incentive Plan.
Compensation Committee
Steven G. Rothmeier, Chairman
Paul B. Ingrey, Member
James N. Land, Jr., Member
William B. Madden, Member
Joseph D. Sargent, Member
STOCK PERFORMANCE GRAPH
The graph below compares the cumulative total shareholder return* (assuming
dividends reinvested) on the Common Stock since May 6, 1993 (the effective
date of the Company's registration statement for the initial public offering
of Common Stock) to the cumulative total shareholder return over such period
of (i) the S&P 500 Index and (ii) the S&P Insurance Broker Index.
<TABLE>
<CAPTION>
[GRAPH]
Cumulative Total Return
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
5/93 6/93 9/93 12/93 3/94 6/94 9/94 12/94
Blanch E W Hldgs Inc EWB 100 99 122 98 91 116 126 114
S&P 500 I500 100 103 106 108 104 104 110 110
S&P INSURANCE BROKERS IINB 100 99 97 90 92 92 89 91
[WIDE TABLE CONTINUED]
<S> <C> <C> <C> <C> <C> <C> <C> <C>
3/95 6/95 9/95 12/95 3/96 6/96 9/96 12/96
Blanch E W Hldgs Inc EWB 103 104 106 132 113 113 110 116
S&P 500 I500 120 132 142 151 159 166 171 185
S&P INSURANCE BROKERS IINB 98 97 105 104 109 109 111 123
</TABLE>
- ----------------
* $100 invested on 05/06/93 in Common Stock or on 04/30/93 in the relevant
index--including reinvestment of dividends. Fiscal year ending December 31.
APPROVAL OF THE E. W. BLANCH HOLDINGS, INC.
RESTRICTED STOCK INCENTIVE PLAN
The Compensation Committee has adopted a Restricted Stock Incentive Plan
which is summarized below. The Plan is being submitted for shareholder
approval in order to comply with the shareholder approval requirement for
qualifying "performance-based compensation" under Section 162(m) of the Code
which would generally preserve the tax-deductible status of incentive
compensation payments.
SUMMARY OF RESTRICTED STOCK INCENTIVE PLAN
The objective of this plan is to provide at risk, equity-based compensation
for a select group of management or highly compensated employees, in order to
further incentivize those key employees to contribute to the financial
success and growth of the Company, to the benefit of the Company's
stockholders.
The eligible participants in the Restricted Stock Incentive Plan are Senior
Vice Presidents, or employees holding equivalent or higher ranks in the
Company or its subsidiaries (approximately 80 persons), which eligible
participants include Messrs. Blanch, Wilkinson, Walker, Packer, and Nelson.
Under this plan, which is voluntary, each eligible participant may elect to
forego a specified percent of his or her base compensation, in exchange for
the right to receive a restricted stock grant. The amount of restricted stock
received is tied to achievement of certain objective performance goals. Those
goals are established by the Compensation Committee within 90 days of the
commencement of the applicable performance period. The target performance
goals may be based on any or all of the following business criteria: stock
price, market share, sales, earnings per share, return on equity, return on
invested capital or net assets employed, cumulative total return to
shareholders, consolidated pre-tax earnings, net earnings, operating income,
earnings before interest and taxes, and cash flow, all as computed in
accordance with generally accepted accounting principles. Once a participant
makes his or her election to participate, that election is irrevocable for
that performance period. If the target performance goals for the performance
period are achieved, and the Compensation Committee so certifies, the
participant is awarded restricted stock equal in value to two times the
amount of base compensation the participant elected to forego, subject to a
three-year vesting schedule. If those target performance goals are not
achieved, the participant is awarded restricted stock equal in value to 50%
of the amount of base compensation the participant elected to forego, which
restricted stock fully vests on the April 1 following the end of that
performance period. The plan can be amended by the Company's Board of
Directors without shareholder approval.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE APPROVAL
OF THE RESTRICTED STOCK INCENTIVE PLAN.
APPROVAL OF THE E. W. BLANCH HOLDINGS, INC.
MANAGEMENT INCENTIVE PLAN
The Compensation Committee has adopted a Management Incentive Plan which is
summarized below. The Plan is being submitted for shareholder approval in
order to comply with the shareholder approval requirement for qualifying
"performance-based compensation" under Section 162(m) of the Code which would
generally preserve the tax-deductible status of the incentive compensation
payments.
SUMMARY OF MANAGEMENT INCENTIVE PLAN
The participants in the Management Incentive Plan are the executive officers
of the Company, currently Messrs. Blanch, Wilkinson, Walker, Packer, and
Nelson. Under the Management Incentive Plan, participants will be allocated
awards from a bonus pool equal to 20% of the Company's Income before Taxes
for each year (excluding the Management Incentive Plan expense) in excess of
120% of the Company's Income before Taxes for the prior year (excluding the
Management Incentive Plan expense and excluding other extraordinary events,
such as restructuring charges, as determined by the Compensation Committee)
plus 37.5% of the aggregate bonus amount awarded to the operating
subsidiaries under their Incentive Plans. The amount awarded to the operating
subsidiaries under their Incentive Plans is based upon the achievement of
revenue growth in excess of a predefined goal and profit margin improvement.
The Chief Executive Officer shall be paid 50% of the Management Incentive
Plan bonus pool. The Committee may not increase this percentage allocation,
but may, in its discretion, reduce it. Bonuses will be allocated to the other
executive officers from the remaining funds in the pool based upon the
Committee's judgment of their performance during the year. In addition,
individual bonuses paid to the participants may not exceed 100% of their
respective base salaries for the year. Bonuses available for distribution
will be paid by March 15 of the following year. In order to be eligible to
receive a bonus, a participant must be an employee of the Company on the date
such bonus is to be paid.
The design of the Management Incentive Plan is the same as the 1996
Management Incentive Plan, previously approved by shareholders. If the
Management Incentive Plan had been in effect during 1996 the aggregate award
computed under the Plan would have been $349,000.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE APPROVAL
OF THE MANAGEMENT INCENTIVE PLAN.
APPROVAL OF THE AMENDMENT TO THE
EMPLOYEE STOCK PURCHASE PLAN
In 1994, the Company's Board of Directors adopted, and the shareholders
approved, an Employee Stock Purchase Plan. This plan became effective on May 1,
1994 and by its terms expires as of May 1, 1997. The plan allows eligible
employees of the Company or its subsidiaries to purchase shares of Common Stock
at 90% of fair market value. All regular part-time and full-time employees of
the Company are eligible to participate. No eligible employee may purchase stock
which exceeds $25,000 of fair market value of such stock, determined at the time
of purchase, for each calendar year that the plan is in effect. As of February
28, 1997, eligible employee have purchased 32,109 shares of Common Stock under
this plan.
Under this plan as currently approved, certain plan terms can be altered,
amended or suspended only with approval of the shareholders, including any
extension in the duration of the plan.
The amendment to the Employee Stock Purchase Plan being submitted to the
shareholders for approval is as follows: to extend the duration of the plan
an additional five years, until May 1, 2002.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE APPROVAL
OF THE AMENDMENT TO THE EMPLOYEE STOCK PURCHASE PLAN.
APPROVAL OF THE AMENDMENT TO THE
1993 STOCK INCENTIVE PLAN
In 1993, the Company's Board of Directors adopted, and the shareholders
approved, a Stock Incentive Plan. This plan is the vehicle for, among other
things, awarding stock options or stock appreciation rights ("SARs") to
eligible employees. Regulations promulgated by the Internal Revenue Service
pursuant to Section 162(m) of the Code provide that the plan under which
stock options or SARs are granted must state the maximum number of shares
with respect to which stock options or SARs may be granted during a specified
period to any employee. The deadline for compliance with these regulations is
the first meeting of shareholders after December 31, 1996. The Company's
Stock Incentive Plan as currently drafted and approved does not comply with
these regulations. The purpose of the proposed amendment, for which
shareholder approval is sought, is to comply with these regulations, and
thereby preserve the deductibility of stock option and SAR awards under
Section 162(m).
The proposed amendment to the 1993 Stock Incentive Plan is as follows: "Award
Limitations Under the Plan. No Eligible Person may be granted any Award or
Awards, the value of which Awards are based solely on an increase in the
value of the shares after the date of grant of such Awards, for more than
250,000 shares in the aggregate in any calendar-year period. The foregoing
annual limitation specifically includes the grant of any 'performance-based'
awards within the meaning of Section 162(m) of the Code."
At the Annual Meeting, the shareholders are being requested to consider and
approve the foregoing amendment to the Stock Incentive Plan.
The essential features of the Stock Incentive Plan are outlined below.
STOCK INCENTIVE PLAN. The Stock Incentive Plan is administered by the
Compensation Committee and no Compensation Committee member is eligible to
participate in the Stock Incentive Plan.
Options granted under the Stock Incentive Plan may be "incentive stock options"
("ISOs"), within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), or nonqualified stock options ("NQSOs"). The
exercise price of the options will be determined by the Compensation Committee
when the options are granted, subject to a minimum price in the case of ISOs of
the Fair Market Value (as defined in the Stock Incentive Plan) of the Common
Stock on the date of grant (110% of Fair Market Value in the case of greater
than 5% shareholders) and a minimum price in the case of NQSOs of the par value
of the Common Stock. In the discretion of the Compensation Committee, the option
exercise price may be paid in cash or in shares of Common Stock or other
property having a Fair Market Value on the date of exercise equal to the option
exercise price, or by delivering to the Company a copy of irrevocable
instructions to a stockbroker to deliver promptly to the Company an amount of
sale or loan proceeds sufficient to pay the exercise price.
The Stock Incentive Plan permits the Compensation Committee to grant stock
appreciation rights ("SARs"). An SAR granted as an alternative or a supplement
to a related stock option will entitle its holder to be paid an amount equal to
the Fair Market Value of the Common Stock subject to the SAR on the date of
exercise of the SAR less the exercise price of the related stock option or such
other price as the Compensation Committee may determine at the time of the grant
of the SAR (which may not be less than the lowest price which the Compensation
Committee may determine under the Stock Incentive Plan for such stock option.)
Shares of Common Stock covered by a restricted stock award will be issued to the
recipient at the time the award is granted but will be subject to forfeiture in
the event continued employment and/or other restrictions and conditions
established by the Compensation Committee at the time the award is granted are
not satisfied.
A performance unit or phantom stock award will provide for the future payment of
cash or the issuance of shares of Common Stock to the recipient if continued
employment or other performance objectives established by the Compensation
Committee at the time of grant are attained.
Stock bonus awards, restricted stock awards and performance unit awards may, in
the discretion of the Compensation Committee, be settled in cash, on each date
on which shares of Common Stock covered by the awards would otherwise have been
delivered or become unrestricted, in an amount equal to the Fair Market Value of
such shares on such date.
As of March 3, 1997, NQSOs covering 150,000 shares of Common Stock had been
granted to the Company's executive officers as a group, of which 100,000 were
granted to Mr. Chris L. Walker, President and Chief Operating Officer, and
50,000 of which were granted to Mr. Tom S. Nelson, Executive Vice President and
Chief Accounting Officer. Options covering 642,500 shares of Common Stock had
been granted to employees other than executive officers, as a group. The term of
all such options is ten years. The options become exercisable over the first
five years of the term. As of March 3, 1997, 108,229 of the options granted are
exercisable. None of these options were exercised as of that date. All of the
options were granted at a price equal to the market price on the date of the
grant, and such option prices range from $17.50 to $22.75.
On March 3, 1997, the closing sale price of a share of Common Stock on the New
York Stock Exchange was $23.00.
FEDERAL TAX CONSEQUENCES. Set forth below is a brief description of the
federal income tax consequences applicable to ISOs and NQSOs granted under
the Stock Incentive Plan.
ISOS
No taxable income is realized by the optionee upon the grant or exercise of
an ISO. If Common Stock is issued to an optionee pursuant to the exercise of
an ISO, and if no disqualifying disposition of such shares is made by such
optionee within two years after the date of grant or within one year after
the transfer of such shares to such optionee, then (1) upon sale of such
shares, any amount realized in excess of the option price will be taxed to
such optionee as a long-term capital gain and any loss sustained will be a
long-term capital loss, and (2) no deduction will be allowed to the
optionee's employer for federal income tax purposes.
If the Common Stock acquired upon the exercise of an ISO is disposed of prior
to the expiration of either holding period described above, generally (1) the
optionee will realize ordinary income in the year of disposition in an amount
equal to the excess (if any) of the fair market value of such shares at
exercise (or, if less, the amount realized on the disposition of such shares)
over the option price paid for such shares, and (2) the optionee's employer
will be entitled to deduct such amount for federal income tax purposes if the
amount represents an ordinary and necessary business expense. Any further
gain (or loss) realized by the optionee will be taxed as short-term or
long-term capital gain (or loss), as the case may be, and will not result in
any deduction by the employer.
Subject to certain exceptions for disability or death, if an ISO is exercised
more than three months following termination of employment, the exercise of
the option will generally be taxed as the exercise of a NQSO.
The exercise of an ISO will give rise to an item of tax preference that may
result in alternative minimum tax liability for the optionee, unless the
optionee engages, within the same year of exercise, in a disqualifying
disposition of the shares received upon exercise. Each optionee is
potentially subject to the alternative minimum tax. In substance, a taxpayer
is required to pay the higher of his/her alternative minimum tax liability or
his/her "regular" income tax liability. As a result, a taxpayer is required
to determine his potential liability under the alternative minimum tax.
In general, for purposes of the alternative minimum tax, the exercise of an
ISO will be treated essentially as if it were the exercise of a NQSO. As a
result, the rules of Section 83 of the Code relating to transfers of
property, including restricted property, will apply in determining the
optionee's alternative minimum taxable income. Consequently, an optionee
exercising an ISO with respect to unrestricted Common Stock will have income,
for purposes of determining the base for the application of the alternative
minimum tax, in an amount equal to the spread between the option price for
the shares and the fair market value of the shares on the date of exercise.
NQSOS
With respect to NQSOs: (1) no income is realized by the optionee at the time
the option is granted; (2) generally, at exercise, ordinary income is
realized by the optionee in an amount equal to the difference between the
option price paid for the shares and the fair market value of the shares, if
unrestricted, on the date of exercise, and the optionee's employer is
generally entitled to a tax deduction in the same amount subject to
applicable tax withholding requirements; and (3) at sale, appreciation (or
depreciation) after the date of exercise is treated as either short-term or
long-term capital gain (or loss) depending on how long the shares have been
held.
RATIFICATION AND APPROVAL OF THE
APPOINTMENT OF INDEPENDENT AUDITORS
On January 23, 1997, the Board of Directors selected the accounting firm of
Ernst & Young LLP to serve as its independent auditor for the fiscal year
ending December 31, 1997. A proposal to ratify that appointment will be
presented at the Meeting. Representatives of Ernst & Young LLP are expected
to be present at the Meeting. They will have an opportunity to make a
statement if they desire to do so and will be available to respond to
appropriate questions from shareholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On February 14, 1997, the Company purchased 750,000 shares of Common Stock
from Edgar W. Blanch, Jr., the Company's Chairman and Chief Executive
Officer. This purchase was negotiated between Mr. Blanch and a Select
Committee of the Board of Directors made up of the Board's outside directors.
The shares were purchased at a negotiated price of $19.40 per share or
$14,550,000. The purchase price represented a 14.7% discount from the trading
price of the Company's Common Stock at the time of the purchase. The purchase
agreement also included a commitment by Mr. Blanch not to sell his remaining
shares for at least a two-year period, except with the approval of the Select
Committee.
In December 1993, the Company invested in Conning Insurance Capital Limited
Partnership III (the "Fund"), a private equity fund which invests in the
insurance industry. One of the Company's directors, Joseph D. Sargent, was
Vice Chairman of Conning & Company at the time, whose affiliate is the
general partner of the Fund. The Company's Chairman and Chief Executive
Officer is a member of the Advisory Board of the Fund. At December 31, 1996,
a total commitment of $4,000,000 had been paid to the Fund.
ADDITIONAL INFORMATION
GENERAL
As of the date of this Proxy Statement, management knows of no matters that
will be presented for determination at the Annual Meeting other than those
referred to herein. However, since matters of which Management is not now
aware may come before the Annual Meeting or any adjournment, the proxies
intend to vote, act and consent in accordance with their best judgment with
respect thereto. Upon receipt of such proxies (in the form enclosed and
properly signed) in time for voting, the shares represented thereby will be
voted as indicated thereon and in this Proxy Statement.
SHAREHOLDER PROPOSALS FOR THE NEXT ANNUAL MEETING
It is anticipated that the next Annual Meeting, after the one scheduled for
April 24, 1997, will be held on or about April 23, 1998. All shareholder
proposals relating to a proper subject for action at the Annual Meeting in
1998, to be included in the Company's Proxy Statement and form of proxy
relating to that meeting, must be received by the Company for its
consideration at its principal executive offices no later than November 21,
1997. Any such proposal should be submitted by certified mail, return receipt
requested.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K IS AVAILABLE WITHOUT
CHARGE TO ANY SHAREHOLDER OF THE COMPANY WHO REQUESTS A COPY IN WRITING.
REQUESTS FOR COPIES OF THIS REPORT SHOULD BE DIRECTED TO THE INVESTOR
RELATIONS DEPARTMENT, E.W. BLANCH HOLDINGS, INC., 4300 CENTERVIEW DRIVE, SAN
ANTONIO, TEXAS 78228.
By Order of the Board of Directors
/s/ Daniel P. O'Keefe
Daniel P. O'Keefe
Secretary
March 24, 1997
E. W. Blanch Holdings, Inc.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Edgar W. Blanch, Jr. and Chris L. Walker as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated below, all the shares of Common
Stock of E. W. Blanch Holdings, Inc. held of record by the undersigned on
March 3, 1997, at the Annual Meeting of Shareholders to be held on April 24,
1997 or any adjournment thereof.
1. ELECTION OF DIRECTORS.
[ ] FOR all nominees listed below
(EXCEPT AS MARKED TO THE CONTRARY BELOW):
[ ] WITHHOLD AUTHORITY
TO VOTE FOR ALL NOMINEES LISTED BELOW:
(INSTRUCTION: to withhold authority to vote for any individual nominee write
that nominee's name on the space provided below.)
- --------------------------------------------------------------------------------
Joseph D. Sargent, Frank S. Wilkinson, Jr.
2. APPROVAL OF THE E. W. BLANCH HOLDINGS, INC. RESTRICTED STOCK INCENTIVE PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. APPROVAL OF THE E. W. BLANCH HOLDINGS, INC. MANAGEMENT INCENTIVE PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. APPROVAL OF THE AMENDMENT TO THE E. W. BLANCH HOLDINGS, INC. EMPLOYEE
STOCK PURCHASE PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. APPROVAL OF THE AMENDMENT TO THE E.W. BLANCH HOLDINGS, INC. 1993 STOCK
INCENTIVE PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
6. RATIFICATION OF APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(CONTINUED, AND TO BE SIGNED, ON REVERSE SIDE)
(CONTINUED FROM OTHER SIDE)
7. In their discretion the Proxies are authorized to vote upon such other
business as may properly come before the Meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IN THE ABSENCE OF SPECIFIC DIRECTIONS, THE
PROXY WILL BE VOTED FOR THE ELECTION OF DIRECTORS AND FOR ITEMS 2-6.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, as executor,
administrator, trustee or guardian, please give full title 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.
Dated: ________________________________, 1997
_____________________________________________
Signature
_____________________________________________
Signature if held jointly
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE
