Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the registrant |X|
Filed by a party other than the registrant |_|
Check the appropriate box:
|_| Preliminary proxy statement
|X| Definitive proxy statement
|_| Definitive additional materials
|_| Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
American CinemaStores Inc.
(Name of Registrant as Specified in Its Charter)
Board of Directors of American CinemaStores Inc.
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
|X| $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(j)(2) or Item 22 (a)(2) of Schedule 14A
|_| $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
|_| 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:(1)
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
|_| 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:
- --------------------------------------------------------------------------------
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(1) Set forth the amount on which the filing fee is calculated and state how it
was determined.
<PAGE>
AMERICAN CINEMASTORES INC.
1543 7TH STREET, SUITE 400
SANTA MONICA, CALIFORNIA 90401
September 30, 1996
Dear Fellow Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders to be
held on Friday, October 25, 1996 at 10:00 A.M. at Marriott Hotel, 21850 Oxnard
Street, Wood Hills, California 91367.
The Notice of Annual Meeting and Proxy Statement which follow describe the
business to be conducted at the meeting.
Whether or not you plan to attend the meeting in person, it is important that
your shares be represented and voted. After reading the enclosed Notice of
Annual Meeting and Proxy Statement, I urge you to promptly complete, sign, date
and return the enclosed proxy card in the envelope provided. If your address on
the accompanying material is incorrect, please advise our Transfer Agent,
Continental Stock Transfer & Trust Company, in writing, at 2 Broadway, New York,
New York 10004.
Your vote is very important, and we will appreciate a prompt return of your
signed proxy card. We hope to see you at the meeting.
Cordially,
/s/ Steve Natale
----------------
Steve Natale,
President
<PAGE>
AMERICAN CINEMASTORES INC.
1543 7TH STREET, SUITE 400
SANTA MONICA, CALIFORNIA 90401
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD FRIDAY OCTOBER 25, 1996
To the Stockholders of AMERICAN CINEMASTORES INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of American
CinemaStores Inc. (the "Company") will be held on Friday, October 25, 1996 at
10:00 AM at Marriott Hotel, 21850 Oxnard Street, Woodland Hills, California
91367 for the following purposes:
1. To elect two (2) directors to hold office until the next Annual
Meeting of Stockholders and until their respective successors have
been duly elected and qualified;
2. To consider and vote upon a proposal to approve an amendment to the
Company's Certificate of Incorporation, as amended, to increase the
number of authorized shares of common stock from 15,000,000 to
30,000,000 and the number of authorized shares of capital stock from
20,000,000 to 35,000,000; and
3. To transact such other business as may properly come before the
meeting or any adjournment or adjournments thereof.
Only stockholders of record at the close of business on September 27, 1996 are
entitled to notice of and to vote at the Annual Meeting or any adjournment
thereof.
By Order of the Board of Directors,
/s/ Steve Natale
----------------
Steve Natale,
President
IF YOU DO NOT EXPECT TO ATTEND THE MEETING:
PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENVELOPE
PROVIDED FOR THAT PURPOSE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES. THE PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE EXERCISE, AND IF YOU
ARE PRESENT AT THE MEETING YOU MAY, IF YOU WISH, REVOKE YOUR PROXY AT THAT TIME
AND EXERCISE THE RIGHT TO VOTE YOUR SHARES PERSONALLY.
<PAGE>
PROXY STATEMENT
AMERICAN CINEMASTORES INC.
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD OCTOBER 25, 1996
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of American CinemaStores Inc. (the "Company")
for use at the Annual Meeting of Stockholders to be held on October 25, 1996,
including any adjournment or adjournments thereof, for the purposes set forth in
the accompanying Notice of Meeting.
Management intends to mail this proxy statement and the accompanying form
of proxy to stockholders on or about September 30, 1996. The costs of soliciting
proxies will be borne by the Company. It is expected that these costs will be
nominal.
Proxies in the accompanying form, duly executed and returned to the
management of the Company and not revoked, will be voted at the Annual Meeting.
Any proxy given pursuant to such solicitation may be revoked by the stockholder
at any time prior to the voting of the proxy by (i) a subsequently dated proxy,
(ii) written notification to the Secretary of the Company, or (iii) personally
withdrawing the proxy at the meeting and voting in person.
The address and telephone number of the Company's executive offices are:
1543 7th Street, Suite 400
Santa Monica, California 90401
Telephone No.: 310-394-6444
OUTSTANDING STOCK AND VOTING RIGHTS
Only stockholders of record at the close of business on September 27, 1996 (the
"Record Date") are entitled to notice of and to vote at the Annual Meeting. As
of the Record Date, there were issued and outstanding 6,892,638 shares of the
Company's common stock, par value $.001 per share (the "Common Stock"), the
Company's only class of voting securities. Each share entitles the holder
thereof to one vote on each matter submitted to a vote at the Annual Meeting.
<PAGE>
VOTING PROCEDURES
The directors will be elected by the affirmative vote of the holders a
plurality of the shares of Common Stock present in person or represented by
proxy at the Annual Meeting, provided a quorum exists. All other matters to be
acted upon at the meeting will be decided by the affirmative vote of the holders
of a majority of the shares of Common Stock present in person or represented by
proxy, provided a quorum exists. A quorum will exist if the holders of at least
a majority of the shares of Common Stock outstanding as of the Record Date is
present in person or represented by proxy at the Annual Meeting. Votes will be
counted and certified by one or more inspectors of election who are expected to
be employees of the Company. In accordance with Delaware law, abstentions and
"broker non-votes" (i.e. proxies from brokers or nominees indicating that such
persons have not received instructions from the beneficial owners or other
persons entitled to vote shares as to a matter with respect to which the brokers
or nominees do not have discretionary power to vote) will be treated as present
for purposes of determining the presence of a quorum. For purposes of
determining approval of a matter presented at the meeting, abstentions will be
deemed present and entitled to vote and will, therefore, have the same legal
effect as a vote "against" a matter presented at the meeting. Broker non-votes
will be deemed not entitled to vote on the matter as to which the non-vote is
indicated and will, therefore, have no legal effect on the vote on such matter.
The enclosed proxies will be voted in accordance with the instructions
thereon. Unless otherwise stated, all shares presented by such proxy will be
voted as instructed. Proxies may be revoked as noted above.
ELECTION OF DIRECTORS
At this year's Annual Meeting of Stockholders, two directors will be
elected to hold office for a term expiring at the 1997 Annual Meeting of
Stockholders and until their respective successors are elected and qualified,
unless any such director dies, resigns or is removed prior thereto. As discussed
below, Mr. Gill Champion, as a director, has agreed with the Company to resign
from all positions with the Company if and at such time as certain mergers
between subsidiaries of the Company and two privately-held corporations are
effected.
At the Annual Meeting of Stockholders, the proxies granted by stockholders
will be voted individually for the election, as directors of the Company, of the
persons listed below, unless a proxy specifies that it is not to be voted in
favor of a nominee for director. In the event any of the nominees listed below
are unable to serve, it is intended that the proxy will be voted for such other
nominees as are designated by the Board of Directors. Subject to Mr. Champion's
agreement with the Company to resign upon the occurrence of contingencies, each
of the nominees named below has indicated to the Board of Directors of the
Company that he will be available to serve.
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<PAGE>
Name Age Position
---- --- --------
Gill Champion 52 Chairman of the Board
Chief Executive Officer
and Secretary
Steve Natale 41 President
Chief Operating Officer,
Treasurer and a Director
Gill Champion has served as Chairman of the Board of Directors and
Secretary of the Company since its inception in June 1992, and as its Chief
Executive Officer since October 1993. Mr. Champion served as Treasurer of the
Company from June 1992 until October 1993. From February 1992 to June 1992, he
was self-employed and engaged in developing the mini-store retail concept which
constituted the Company's initial business. From June 1989 to January 1992, Mr.
Champion was Chairman of the Board and Chief Executive Officer of Movie Music,
Inc., a corporation organized for the purpose of developing mini-stores for
retail sales. Mr. Champion attended New York University and Rutgers University
from 1961 to 1963 and the American Academy of Dramatic Arts from 1963 to 1965.
Steve Natale has served as President and a director of the Company since
June 1992 and Chief Operating Officer and Treasurer since October 1993. From
October 1991 until May 1992, Mr. Natale was Vice President, Creative Services,
for JRS Records, a record company. From May 1988 to October 1991, Mr. Natale was
self-employed and engaged in developing the mini-store concept that constituted
the Company's initial business. Mr. Natale received an Associate of Arts degree
from Boston State College in 1974 and attended Boston College from 1975 to 1976.
During the fiscal year ended May 31, 1996, the Board of Directors acted on
two (2) occasions either at meetings attended by all of the directors, either in
person or by telephone, or by unanimous written consent in lieu of a meeting.
The Company does not have any standing committees of the Board of Directors.
The Company has entered into Agreements and Plans of Merger dated as of
June 19, 1996 (the "Merger Agreements") with (a) one of its wholly-owned
subsidiaries (the "Superior Merger Sub"), Superior/Panoramic Hand Prints Inc.
("Superior"), the trustees of the Strem 1993 Family Trust (the "Strem Trust")
and Robert J. Strem, and (b) another wholly-owned subsidiary of the Company (the
"JJC Merger Sub"), Just Jackets Corporation ("JJC"), the stockholders of JJC and
Bruce Sacks. The Merger Agreements provide, among other things, that (i) the
resignation of Mr. Champion as a director and Mr. Strem's election to such
position are conditions to the obligations of Superior and JJC (the "Target
Companies") to merge with and into the subsidiaries of the Company referred to
above (the "Mergers"), and
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<PAGE>
(ii) the Company will take reasonable action to cause the following to occur at
the closing under the Merger Agreements: (A) amend the Company's by-laws to
increase the number of directors constituting the Board of Directors to five
persons; (B) effect the resignation of Mr. Champion as a director and nominate
and cause to be elected as new directors to fill the newly created vacancies,
Robert J. Strem, a designee of The Boston Group, L.P., a broker/dealer
registered under the Securities Exchange Act of 1934, as amended, and two other
persons to be designated by Messrs. Natale and Strem. Mr. Champion has entered
into an agreement with the Company pursuant to which he has agreed to resign
from all positions with the Company at the time the Mergers are effected (the
"Effective Time") and Messrs. Champion and Natale have agreed to vote their
shares of Common Stock in favor of the election of Strem as director following
the Effective Time.
EXECUTIVE COMPENSATION
The following table discloses for the fiscal years ended May 31, 1996, 1995 and
1994, compensation for Mr. Gill Champion, Chairman of the Board and Chief
Executive Officer, and Mr. Steve Natale, President and Chief Operating Officer,
the only other executive officer whose annual compensation exceeded $100,000
during the fiscal year ended May 31, 1996. Messrs. Champion and Natale (the
"Named Executives") received no additional compensation for serving on the Board
of Directors.
-4-
<PAGE>
Summary Compensation Table
Long Term
Annual Compensation Compensation
----------------------- ----------
Securities
Other Annual Underlying
Name and Fiscal Salary Compensation(1) Options(2)
Principal Position Year ($) ($) (#)
- ------------------ ---- ------ --------------- ----------
Gill Champion, 1996 126,875 7,657 --
Chief Executive Officer 1995 125,000 7,657 --
Chairman of the Board 1994 125,000 7,657 60,000
Steve Natale, 1996 101,500 5,796 --
President, and Chief 1995 100,000 5,796 --
Operating Officer 1994 100,000 5,055 140,000
- ----------
(1) The amount reported in this column represents the annual amount paid as an
allowance for leasing and insuring an automobile for the Named Executives
and for reimbursement of automobile costs.
(2) On July 19,1994, the Board of Directors unanimously approved the
declaration of a stock dividend of one share of Common Stock for each share
of Common Stock issued and outstanding effective as of August 1, 1994.
Share data, except as otherwise noted, has been retroactively adjusted to
reflect such stock dividend.
The following table sets forth information with respect to stock options
held by the Named Executives at May 31, 1996. No stock options were granted by
the Company to, or were exercised by, the Named Executives during such fiscal
year.
-5-
<PAGE>
Fiscal Year End Option Values
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options
Options at May 31, 1996 at May 31, 1996 (1)
--------------------------- ---------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
Gill Champion 60,000 (2) -0- -0- -0-
Steve Natale 140,000(2) -0- -0- -0-
Christopher J. 215,000(2) -0- -0- -0-
Ebert
- ----------
(1) Options are "in-the-money" if the fair market value of a share of Common
Stock exceeds the exercise prices of such options. At May 31, 1996, the
closing bid price per share of the Common Stock as reported by NASDAQ Small
Cap was $2.50. No options were "in-the-money" at May 31, 1996.
(2) Incentive stock options granted under the Company's 1993 Stock Option Plan,
as amended, which become exercisable after one year from the date of grant,
and in the case of Mr. Champion, expire 30 days after the termination of
his employment with the Company (i.e., the Effective Time if the Mergers
are effected), and, in the case of Messrs. Natale and Ebert, expire upon
the earlier of (i) four years from the date such options became exercisable
or (ii) 30 days after the termination of each of their employment with the
Company.
Employment and Termination Agreements
Mr. Natale, the Company's President, is employed under an employment
agreement which expires in March 1997 if either party gives the other notice of
termination at least 30 days prior to the expiration date (otherwise, the
employment term will expire in March 1997). Under such agreement, Mr. Natale
currently receives base compensation at the annual rate of $101,500 subject to
annual increases based on changes in the consumer price index.
If the Mergers are effected, Robert J. Strem, as President of the Superior
Merger Sub, will enter into a three-year employment agreement with the Company,
Christopher J. Ebert, the Company's Chief Financial Officer will enter a
two-year employment agreement with the Company, and Bruce Sacks will enter into
a one-year employment agreement with the JJC Merger Sub, and the Company will
guarantee the performance of the JJC Merger
-6-
<PAGE>
Sub under such employment agreement, and Mr. Natale's existing employment
agreement will be extended to expire on the third anniversary of the Effective
Time.
Except for base compensation arrangements and the employment term of Mr.
Sacks, the provisions of such employment agreements will be substantially
similar to the terms of Mr. Natale's current employment agreement with the
Company. The Company will agree to pay Mr. Strem base compensation at the annual
rate of $165,000, subject to annual increases or bonuses at the discretion of
the Company's Board of Directors. The JJC Merger Sub will agree to compensate
Mr. Sacks at the annual rate of $110,000 and the Company will agree to
compensate Messrs. Natale and Ebert at $125,000 and $110,000, respectively,
subject to increases and bonuses at the discretion of the Company's Board of
Directors. Under the employment agreements, an executive will be entitled to
terminate his employment for "good reason" (which includes a "change of
control," as defined in such employment agreements, limitation of an executive's
powers or removal of an executive from, or failure to elect an executive to, his
then current office), and the Company may terminate an executive's employment
for "cause" (as defined in such employment agreements). Upon termination of an
executive's employment by the Company (other by reason of death, disability or
for cause), or upon termination of the employment term by an executive for "good
reason" or by reason of the employer's breach of the employment agreement, the
employer is required to pay base compensation to the executive for a period
equal to the unexpired balance of the contract term.
The employment agreements will provide that each executive will be entitled
to all benefits provided to executives of the Company, to the use of an
automobile, (including reimbursement of expenses related to the operation and
maintenance thereof), and four weeks paid vacation (three weeks in the case of
Mr. Sacks).
Mr. Natale's current employment agreement and each proposed employment
agreement provides for non-disclosure by an executive, during his employment
term and, thereafter, of information deemed by the Company to be confidential
and for non-competition with the Company in the continental United States for
one year following the date of termination (but not expiration) of his
employment term.
Mr. Champion has agreed, pursuant to a letter agreement with the Company
dated June 25, 1996 (the "Letter Agreement") to resign as a director, Chairman
of the Board and Chief Executive Officer of the Company, effective as of the
Effective Time (as therein defined). Under the terms of the Letter Agreement,
Mr. Champion has agreed to cooperate fully with the Company and its officers to
effect the Mergers. The Company has agreed to pay Champion his total unpaid
salary and employment benefits through March 15, 1997 (the expiration date of
Mr. Champion's term), which amount shall be payable over the original term of
Champion's employment agreement. The Company also agreed to maintain in full
force and effect its currently existing director and officer liability policy
with respect to Champion. The Company and Mr. Champion also agreed to release
one another from any and all liability relating to the termination of Mr.
Champion as an officer and director of the Company.
-7-
<PAGE>
Directors' Compensation
Directors receive no cash compensation for serving on the Board. However,
non-employee directors are eligible to be granted non-statutory stock options
under the Company's 1993 Stock Option Plan, as amended. Nonstatutory stock
options may be granted for up to 10 years from the date of grant at such
exercise prices as the Board of Directors may determine. There are no
non-employee directors currently serving on the Board of Directors.
PROPOSAL I
AMENDMENT OF CERTIFICATE OF INCORPORATION, AS AMENDED, TO
INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
FROM 15,000,000 TO 30,000,000
On August 26, 1996, the Board of Directors of the Company unanimously voted
to recommend to the stockholders that the Company's certificate of
incorporation, as amended, be amended to increase the number of authorized
shares of Common Stock from 15,000,000 to 30,000,000 shares and to increase the
total number of authorized shares of capital stock from 20,000,000 to
35,000,000.
The authorized Common Stock of the Company currently consists of 15,000,000
shares, par value $0.001 per share, of which 6,892,638 shares were outstanding
at September 1, 1996 and approximately 6,025,000 additional shares were reserved
for issuance pursuant to the Company's 1993 Stock Option Plan, as amended, and
with respect to outstanding warrants previously issued by the Company.
The Board has determined that the authorization of additional shares of
Common Stock is necessary to provide a sufficient number of shares of Common
Stock for issuance upon exercise or conversion of outstanding options, warrants
and convertible securities and other outstanding obligations to issue Common
Stock and is desirable in connection with possible future stock dividends,
future financings, joint ventures, acquisitions and other general corporate
purposes. Other than as described above, and as contemplated in connection with
the Mergers and the financing thereof, there are no existing plans,
understandings or agreements for the issuance of any shares of Common Stock. If
the amendment is adopted by the stockholders, the Board of Directors will have
authority to issue shares of Common Stock without the necessity of further
stockholder action. Holders of the Common Stock have no preemptive rights with
respect to any shares which may be issued in the future.
In accordance with the terms of the Company's 1993 Stock Option Plan, as
amended, and other outstanding obligations to issue shares of Common Stock,
appropriate adjustments will be made to the number of shares of Common Stock
reserved for issuance pursuant to such Plan and obligations and the exercise or
conversion prices thereof.
-8-
<PAGE>
The rights of the current holders of Common Stock will be subject to, and
may be adversely affected by, the Board's authority to issue additional shares
of Common Stock without stockholder approval. Issuance of shares of Common
Stock, while providing desired flexibility in connection with possible
acquisitions and other corporate purposes, could have the effect of making it
more difficult for a third party to acquire, or of discouraging a third party
from acquiring, a majority of the outstanding shares of Common Stock.
Under Delaware law, stockholders are not entitled to dissenter's rights
with respect to the proposed amendment to the Company's certificate of
incorporation, as amended. If the amendment is approved, the first complete
paragraph of Article IV of the Company's certificate of incorporation will be
amended to read as follows:
"FOURTH: The total number of shares of capital stock which
the Corporation shall have authority to issue is thirty-five
million (35,000,000), of which 30,000,000 shares shall be
classified as common stock, having a par value of $0.001 per
share, and 5,000,000 shares shall be classified as preferred
stock, having a par value of $0.01 per share."
Recommendation and Vote Required
The affirmative vote of the holders of a majority of the outstanding shares
of Common Stock entitled to vote at the meeting is required to authorize the
proposed increase in the authorized number of shares of Common Stock.
The Board of Directors has unanimously approved the increase in the number
of authorized shares of Common Stock and recommends that stockholders vote "FOR"
the proposed increase in authorized shares of Common Stock.
VOTING SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of September 1, 1996,
with respect to beneficial ownership of the Company's Common Stock by (i) each
person known by the Company to be a beneficial owner of more than 5% of the
outstanding shares of Common Stock; (ii) the Named Executives, and (iii) all
directors and executive officers as a group. Unless otherwise noted, the Company
believes that all of the persons named in the above table have sole voting and
investment power with respect to all shares of Common Stock beneficially owned
by them.
Name and Address Amount and Nature of % of Beneficial
of Beneficial Owner Beneficial Ownership Ownership
- ------------------- -------------------- ---------
Steve Natale(1) 1,277,345(2) 18.2
Gill Champion(1) 399,256(2) 5.7
-9-
<PAGE>
All officers and directors as a
group (three persons) 1,891,601(3) 25.9
- ----------
(1) The address for each of Messrs. Champion and Natale is c/o American
CinemaStores Inc., 1543 7th Street, Suite 400, Santa Monica, California
90401.
(2) Includes for Mr. Natale, 140,000 shares issuable upon exercise of
immediately exercisable options, and for Mr. Champion, 60,000 shares of
Common Stock issuable upon the exercise of immediately exercisable options.
(3) In addition to the options held by Messrs. Champion and Natale, includes
215,000 shares of Common Stock exercisable upon exercise of immediately
exercisable options held by an executive officer of the Company.
Compliance with Section 16(a) of the Securities and Exchange Act of 1934
Section 16(a) of the Securities and Exchange Act of 1934, as amended,
requires the Company's officers and directors and persons who beneficially own
more than 10% of a registered class of the Company's equity securities, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission (the "SEC"). Officers, directors and greater than 10% owners are
required by SEC regulations to furnish the Company with copies of all section
16(a) forms they file.
Based solely on the Company's review of the copies of such forms received
by it, the Company believes that during the year ended May 31, 1996, filing
requirements applicable to its officers, directors and greater than 10% owners
were complied with.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In June 1992, the Company issued 1,346,116 shares of Common Stock to Steve
Natale, its President, Chief Operating Officer, Treasurer and a director, for
$975, and 517,738 shares of Common Stock to Gill Champion, its Chairman of the
Board, Chief Executive Officer and Secretary, for $375.
In April 1993, the Company entered into a registration rights agreement
with all eight of its then current stockholders, including Messrs. Natale and
Champion, under which the Company granted to its stockholders the right to
request, on two occasions during the five-year period ending in April 1998, that
the Company register for sale under the Securities Act of 1933, as amended, the
shares of Common Stock owned by such stockholders, provided that the Company is
then eligible to use registration Form S-3. Such stockholders
-10-
<PAGE>
were also granted, for a period currently in effect and expiring in April 2000,
certain piggyback registration rights with respect the shares of Common Stock
owned by them during a period expiring in April 2000. Of such eight persons,
only Messrs. Natale and Champion still hold shares of Common Stock.
In November 1993, the Company sold 1,208 shares of Common Stock to Steve
Natale and 518 shares of Common Stock to Gill Champion, at a price of $.005 per
share.
In November 1993, certain affiliates of A.S Goldmen & Co., Inc., one of the
underwriters of the Company's 1994 public offering of Common Stock, sold to
Natale an aggregate of 140,000 shares of Common Stock and to Gill Champion an
aggregate of 60,000 shares of Common Stock, at a price of $.005 per share.
See "Executive Compensation - Employment and Termination Agreements" for
information as to the terms of existing and proposed employment agreements
between the Company and its executive officers and a termination agreement with
Gill Champion, the Company's Chairman of the Board and Chief Executive Officer.
See "Executive Compensation" for information as to options granted to
certain executive officers of the Company under the Company's 1993 Stock Option
Plan, as amended.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
BDO Seidman has audited and reported upon the financial statements of the
Company for the fiscal year ended May 31, 1996. A representative of BDO Seidman
is expected to be present at the Annual Meeting with the opportunity to make a
statement if he or she desires to do so and is expected to be available to
respond to appropriate questions.
STOCKHOLDER PROPOSALS FOR THE 1997 ANNUAL MEETING
Stockholders who wish to present proposals appropriate for consideration at the
1997 Annual Meeting of stockholders must submit the proposal in proper form to
the Company at its address as set forth on the first page of this Proxy
Statement not later than July 2, 1997 in order for the proposition to be
included on the agenda of the Annual Meeting. Any such proposals, as well as any
questions related thereto, should be directed to the Secretary of the Company.
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<PAGE>
OTHER INFORMATION
Proxies for the Annual Meeting will be solicited by mail and through the
brokerage institutions and all expenses involved, including printing and
postage, will be paid by the Company.
A COPY OF THE COMPANY'S ANNUAL REPORT TO STOCKHOLDERS REPRESENTED BY THE
COMPANY'S FORM 10-KSB ANNUAL REPORT FOR THE FISCAL YEAR ENDED MAY 31, 1996 IS
BEING FURNISHED HEREWITH TO EACH STOCKHOLDER OF RECORD AS OF THE CLOSE OF
BUSINESS ON SEPTEMBER 27, 1996. ADDITIONAL COPIES OF THE FORM 10-KSB WILL BE
PROVIDED FOR A $5.00 CHARGE UPON WRITTEN REQUEST TO THE SECRETARY.
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<PAGE>
The Board of Directors is aware of no other matters, except of those incident to
the conduct of the Annual Meeting, that are to be presented to the stockholders
for formal action at the Annual Meeting. If, however, any other matters properly
come before the Annual Meeting or any adjournments thereof, it is the intentions
of the named in the proxy to vote the proxy in accordance with their judgement.
September 30, 1996 By order of the Board of Directors,
/s/ Steve Natale
----------------
Steve Natale
President
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<PAGE>
AMERICAN CINEMASTORES, INC.
1543 7th Street, Suite 400
Santa Monica, California 90401
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD OCTOBER 25, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Christopher Ebert and Tamara E. Brcka, and
each of them, Proxies, with full power of substitution in each of them, in the
name, place and stead of the undersigned, to vote at the Annual Meeting of
Stockholders of American Cinemastores, Inc. on Friday, October 25, 1996, at
10:00 am at the Marriott Hotel, 21850 Oxnard Street, Woodland Hills, California,
91367 or at any adjournment or adjournments thereof, according to the number of
votes that the undersigned would be entitled to vote if personally present, upon
the following matters:
1. ELECTION OF DIRECTORS:
|_| FOR all nominees listed below |_| WITHHOLD AUTHORITY
(except as marked to the to vote for all nominees
contrary below). listed below.
Steve Natale Gill Champion
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space below.)
- --------------------------------------------------------------------------------
2. AMENDMENT TO COMPANY'S CERTIFICATE OF INCORPORATION TO INCREASE AUTHORIZED
SHARES OF COMMON STOCK FROM 15,000,000 TO 30,000,000 AND TOTAL AUTHORIZED
SHARES OF CAPITAL STOCK FROM 20,000,000 TO 35,000,000:
|_| FOR the Amendment |_| AGAINST the Amendment
(Continued on the reverse side)
<PAGE>
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS GIVEN ABOVE. IF NO
INSTRUCTIONS ARE GIVEN, THIS PROXY WILL BE VOTED FOR THOSE NOMINEES AND THE
PROPOSALS LISTED ABOVE.
DATED: ______________________, 1996
Please sign exactly as name appears
hereon. When shares are held by
joint tenants, both should sign.
When signing as attorney, 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.
-----------------------------------
Signature
-----------------------------------
Signature if held jointly
|_| I PLAN |_| DO NOT PLAN
TO ATTEND THE ANNUAL
MEETING
Please mark, sign, date and return this proxy card promptly using
the enclosed envelope.
