FOTOBALL USA, INC.
3738 Ruffin Road
San Diego, California 92123
__________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
July 31, 1997
__________________
TO THE HOLDERS OF COMMON STOCK OF FOTOBALL USA, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Fotoball USA, Inc. (the "Corporation") will be held at 2 o'clock P.M., local
time, on July 31, 1997, at the Four Points Hotel, 8110 Aero Drive, San Diego,
California, for the following purposes:
1. To elect one (1) director of the Corporation to hold office until the
2000 Annual Meeting of Stockholders and until the election and
qualification of his successor.
2. To vote upon the ratification of the appointment of Hollander, Gilbert &
Co. as the Corporation's independent auditors for fiscal year 1997.
3. To transact such other business as may properly come before the meeting
or any and all adjournments thereof.
Only holders of record of the Corporation's common stock at the close of
business on June 16, 1997 are entitled to receive notice of, and to vote at,
the meeting and any adjournment(s) thereof. Such stockholders may vote in
person or by proxy. The stock transfer books of the Corporation will not be
closed.
Stockholders who find it convenient are cordially invited to attend the
meeting in person. If you are not able to do so and wish that your shares be
voted, you are requested to fill in, sign, date and return the accompanying
proxy in the enclosed envelope. No postage is required if mailed in the
United States.
By Order of the Board of Directors,
KAREN M. BETRO
Secretary
Dated: June 30, 1997
<PAGE>
FOTOBALL USA, INC.
3738 Ruffin Road
San Diego, California 92123
__________________
PROXY STATEMENT
__________________
Annual Meeting of Stockholders
July 31, 1997
__________________
This statement is furnished in connection with the solicitation by the
Board of Directors of Fotoball USA, Inc. (the "Corporation") of proxies to be
used at the Annual Meeting of Stockholders of the Corporation to be held at
2:00 P.M., local time, on July 31, 1997, at the Four Points Hotel, 8110 Aero
Drive, San Diego, California, and at any adjournment(s) thereof. If proxy
cards in the accompanying form are properly executed and returned, the shares
of the Corporation's common stock, par value $.01 per share (the "Common
Stock"), represented thereby will be voted as instructed on the proxy, but
if no instructions are given, such shares will be voted (1) for the election
as director of the nominee of the Board of Directors named below, (2) in
favor of the ratification of the appointment of Hollander, Gilbert & Co. as
the Corporation's independent auditors for fiscal year 1997 and (3) in the
discretion of the proxies named in the proxy card on any other proposals to
properly come before the meeting or any adjournment thereof.
Any proxy may be revoked prior to its exercise, but the attendance at the
meeting by any stockholder who has previously given a proxy will not have
the effect of revoking the proxy unless such stockholder delivers written
notice of revocation to the secretary of the meeting prior to the exercise of
the proxy. The approximate date of mailing of this Proxy Statement and the
accompanying proxy card is June 30, 1997.
<PAGE>
VOTING
Holders of record of the Common Stock on June 16, 1997 (the "Record Date")
will be entitled to vote at the Annual Meeting or any adjournment thereof.
As of that date, there were 2,676,742 shares of Common Stock outstanding
and entitled to vote and a majority, or 1,338,372 of these shares, will
constitute a quorum for the transaction of business. Each share of Common
Stock entitles the holder thereof to one vote on all matters to come before
the meeting, including the election of a director.
The favorable vote of a majority of the shares represented in person or
by proxy and entitled to vote at the meeting is necessary to (i) elect the
director nominated for election at the meeting and (ii) ratify the appointment
of Hollander, Gilbert & Co. as the Corporation's independent auditors for
fiscal year 1997. Abstentions will have the same effect as votes against
the proposals. Broker non-votes will be disregarded and will have no effect
on the outcome of the votes for the proposals. The Board of Directors
recommends a vote FOR each of the proposals set forth above.
ELECTION OF DIRECTORS
The Corporation's Certificate of Incorporation and By-laws provide for a
Board of Directors divided into three classes of directors serving staggered
three-year terms. The Board of Directors recently approved a reduction in
the size of the Board from five members to four. At the forthcoming meeting
to be held on July 31, 1997, one director from the third class will be elected
for a term expiring at the 2000 Annual Meeting of Stockholders. The Board of
Directors has recommended Michael Favish as the nominee for election as a
director from such class. The continuing director from the first class,
Sabin Streeter, is serving a term that expires on the date of the 1998 Annual
Meeting of Stockholders and the continuing directors from the second class,
Robert N. Weingarten and Joel K. Rubenstein, are serving terms that expire on
the date of the 1999 Annual Meeting of Stockholders.
Unless otherwise specified in the accompanying proxy, the shares voted
pursuant thereto will be cast for Michael Favish as the director from the
third class, to hold office until the 2000 Annual Meeting of Stockholders and
until his successor shall be duly elected and shall have qualified. If, for
any reason, at the time of election, Mr. Favish should be unwilling to accept
nomination or election, it is intended that such proxy will be voted for the
election, in his place, of a substitute nominee recommended by the Board of
Directors. However, the Board of Directors has no reason to believe that Mr.
Favish will be unable or unwilling to serve as a director, if elected.
2<PAGE>
Information with respect to the Corporation's directors is set forth
below.
Positions and Offices Has Been a
Presently Held With Director
Name Age the Corporation Since
---- --- --------------- -----
Current Nominee:
Michael Favish............... 48 President, Chief 1988
Executive Officer and
Director
Directors Continuing in Office:
Director From First Class:
Sabin C. Streeter............ 55 Director 1989
Directors From Second Class:
Joel K. Rubenstein........... 60 Director 1994
Robert N. Weingarten......... 44 Director 1994
Michael Favish has served as President and a director of the Corporation
since its organization in December 1988 and as President, Chief Executive
Officer and a director of the Corporation since March 1994.
Sabin C. Streeter has served as a director of the Corporation since
January 1989. From November 1976 until his retirement in April 1997, Mr.
Streeter was employed as either a senior vice president or a managing
director of Donaldson, Lufkin & Jenrette Securities Corporation , an
investment banking firm or its venture capital affiliate, the Sprout Group.
Mr. Streeter is currently serving on the Board of Directors of Oakwood
Homes Corporation and The Middleby Corporation, both of which are publicly-held
corporations, and Parker-Hunter Incorporated, a privately-held securities
firm.
Joel K. Rubenstein has served as a director of the Corporation since
August 1994. From April 1990 through April 1992 and from March 1994 to
present, Mr. Rubenstein has been a partner of the Contrarian Group, Inc., an
operating management company. In addition, from April 1993 to present, Mr.
Rubenstein has been a principal of Oracle One Partners, Inc., a marketing
management company. From April 1992 through March 1994, Mr. Rubenstein
served as the Senior Project Manager, Business and Economic Development for
Rebuild L.A., the recovery organization created after the Los Angeles
riots. Prior to such time, from January 1985 through April 1990, Mr.
Rubenstein served as the Vice President, Corporate Marketing for Major League
Baseball, Office of the Commissioner.
Robert N. Weingarten has served as a director of the Company since June
1994. From July 1992 to present, Mr. Weingarten has been the sole shareholder
of Resource One Group, Inc., a financial consulting and advisory company.
Commencing January 1, 1997, Mr Weingarten joined Chelsea Capital Corporation
as a principal. Chelsea Capital Corporation is a merchant banking firm
located in Beverly Hills, California. From January 1991 through December
1992, Mr. Weingarten served as a general partner of Commerce Partners, a
3<PAGE>
consulting firm specializing in financial restructurings and business
reorganizations. Since 1979, Mr. Weingarten has served as a consultant with
numerous public companies in various stages of development, operation or
reorganization. Mr. Weingarten currently serves as a consultant to the
Corporation. See "Executive Compensation - Certain Relationships and Related
Transactions."
MEETINGS OF THE BOARD OF DIRECTORS
During the fiscal year ended December 31, 1996, the Board of Directors
held five meetings. During such period, each of the then-current directors
of the Corporation attended 75% or more of the aggregate of (1) the total
number of meetings of the Board of Directors and (2) the total number of
meetings held by all committees of the Board of Directors on which such
director served.
The Board of Directors has standing audit and compensation committees.
The members of the audit committee are Joel K. Rubenstein and Robert N.
Weingarten. The audit committee's primary responsibilities are to recommend
the appointment of the Corporation's independent auditors and to review the
scope and results of the audits, the internal accounting controls of the
Corporation, audit practices and the professional services furnished by the
independent auditors. The audit committee held two meetings during the
fiscal year ended December 31, 1996.
The members of the compensation committee are Joel K. Rubenstein and
Sabin C. Streeter. The compensation committee's primary responsibility is
to review the compensation arrangements relating to senior officers of the
Corporation and to administer the Corporation's 1994 Stock Option Plan.
The compensation committee held three meetings during the fiscal year ended
December 31, 1996.
4<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of May 31, 1997
with respect to the Common Stock of the Corporation beneficially owned by
(a) all persons known to the Corporation to own beneficially more than 5% of
any class of voting security of the Corporation, (b) all directors and
nominees, (c) the Named Executives (as defined under the caption "Executive
Compensation") and (d) all executive officers and directors of the Corporation
as a group.
Amount and Percent of
Nature of Common
Beneficial Stock
Name and Address Ownership (1) Ownership (1)
---------------- ------------- --------------
Michael Favish
3738 Ruffin Road
San Diego, CA 92123................... 514,085(2) 18.5%
Robert N. Weingarten
5439 Lockhurst Drive
Woodland Hills, CA 91367.............. 74,445(3) 2.8%
David G. Forster
3708 Cameo Lane
San Diego, CA 92111................... 53,149(4) 2.0%
Sabin C. Streeter
2 Woods Witch Lane
Chappaqua, NY 10514................... 31,247(5) 1.2%
Joel K. Rubenstein
c/o 500 Newport Center Drive,
Suite 900
Newport Beach, CA 92660............... 5,600(6) *
Fred S. Ostern
3121 Hamburg Square
La Jolla, CA 92037.................... 0 0
All executive officers and directors
as a group (consisting of 9 persons).... 716,332 26.8%
_____________
* Less than 1%.
5<PAGE>
(1) This table identifies persons and entities having sole voting and/or
investment power with respect to the shares set forth opposite their
names as of May 31, 1997 according to information furnished to the
Corporation by each of them. A person is deemed to be the beneficial
owner of securities that can be acquired by such person within 60 days
from the date of this Proxy Statement upon the conversion of convertible
securities or the exercise of warrants or options. Percent of Common
Stock Ownership is based on 2,676,742 shares of Common Stock outstanding,
and assumes that in each case the person or entity only, or the group
only, exercised his or its rights to purchase all shares of Common Stock
underlying stock options and warrants.
(2) Includes 100,000 and 3,333 shares of Common Stock issuable upon exercise
of currently exercisable options at per share exercise prices of $5.78
and $8.00, respectively.
(3) Includes 5,000 shares of Common Stock issuable upon exercise of currently
exercisable options at per share exercise prices of $5.25 - $7.75.
(4) Includes 34,273 shares of Common Stock issuable upon exercise of warrants
and currently exercisable options at per share exercise prices of
$ .01 - $ 8.00.
(5) Includes 10,000 shares of Common Stock issuable upon exercise of currently
exercisable options at per share exercise prices of $5.25 - $7.75.
(6) Includes 5,000 shares of Common Stock issuable upon exercise of currently
exercisable options at per share exercise prices of $5.25 - $7.75.
Section 16(a) Beneficial Ownership Reporting Compliance. Section 16(a)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
requires the Company's directors and executive officers and persons who
beneficially own more than ten percent (10%) of the Common Stock
(collectively, the "Reporting Persons") to file with the Securities and
Exchange Commission (the "Commission") initial reports of beneficial
ownership and reports of changes in beneficial ownership of the Common Stock.
Reporting Persons are required to furnish the Company with copies of all such
reports. To the Company's knowledge, based solely on a review of copies of
such reports furnished to the Company and certain representations of the
Reporting Persons, the Company believes that during the 1996 fiscal year all
of the Reporting Persons complied with all applicable Section 16(a) reporting
requirements, except as set forth in the following sentence. Joel K.
Rubenstein filed one late report covering the acquisition of 200 shares of
Common Stock in December 1996.
6<PAGE>
EXECUTIVE COMPENSATION
Summary of Cash and Certain Other Compensation
The following table shows, for the fiscal years ended December 31, 1994,
1995 and 1996, the compensation paid by the Corporation, as well as certain
other compensation paid or accrued for those years, to Michael Favish, the
Corporation's President and Chief Executive Officer, David G. Forster, the
Corporation's Vice President of Finance and Chief Financial Officer, and
Fred S. Ostern, the Corporation's Vice President of Marketing (the "Named
Executives"). No other person who served as an executive officer of the
Corporation received salary and bonus in excess of $100,000 during the fiscal
year ended December 31, 1996.
Summary Compensation Table
Annual Long-Term
Compensation Compensation
---------------------------------------- ------------
Other
Annual
Name and Principal Compen-
Position Year Salary($) Bonus($) sation($) Options(#)
- -------- ---- --------- -------- -------- ---------
Michael Favish 1996 153,247 74,250 0 10,000
President and Chief 1995 152,756 0 0 0
Executive Officer 1994 100,742 0 0 100,000
David G. Forster 1996 76,010 55,750 0 10,500
Vice President of Finance 1995 70,112 12,000 0 12,500
and Chief Financial Officer 1994 64,257 10,799 0 35,000
Fred S. Ostern 1996 150,000 355,069 0 0
Vice President 1995 329,965 0 0 0
of Marketing (1) 1994 296,185 0 0 0
(1) See "-Certain Relationships and Related Transactions."
Certain Relationships and Related Transactions
The Corporation was party to an Exclusive Services Agreement (the "TEGI
Agreement") dated December 23, 1993 with The Eastwoods Group, Inc. ("TEGI")
for the services of Fred Ostern. Mr. Ostern is the sole officer of TEGI.
Pursuant to the TEGI Agreement, TEGI agreed to provide the Corporation with
the exclusive services of Mr. Ostern until December 31, 1995. In connection
with such provision of services of Mr. Ostern, pursuant to which Mr. Ostern
participated in the management of premium contracts from negotiation to
completion, TEGI was paid $296,185 in 1994 and $329,965 in 1995. Effective
January 1, 1996, the Corporation is party to the Ostern Agreement with Mr.
Ostern. See "Employment Contracts and Termination of Employment and
Change-in-Control Arrangements."
Mr. Weingarten, a director of the Corporation, is currently retained as a
consultant to the Corporation. Pursuant to a prior consulting agreement with
7<PAGE>
Mr. Weingarten, the Corporation agreed to pay Mr. Weingarten an aggregate sum
of $60,000, of which $30,000 was paid on August 1, 1994 and the remaining
amount was paid in twelve monthly installments of $2,500 each, commencing on
September 1, 1994. The Company entered into a new consulting agreement with
Mr. Weingarten for a twelve-month period commencing September 1, 1995 at a
rate of $2,500 per month. Effective January 1, 1996, the Board of Directors
approved a $10,000 increase in Mr. Weingarten's consulting agreement, to be
paid over the remaining term of the agreement. The consulting agreement was
renewed for an additional twelve-month period commencing September 1,
1996 at a rate of $3,333 per month.
Michael Favish, President and Chief Executive Officer of the Corporation
and Karen Betro, Vice President-Administration have a long-term relationship.
Derrick Favish, a non-officer employee and stockholder of the Corporation,
is the brother of Michael Favish, the President and Chief Executive Officer
of the Corporation. Greg Favish, a non-officer employee and stockholder of
the Corporation, is the son of Michael Favish.
Any future transaction with directors, executive officers or their
affiliates, including, without limitation, any granting or forgiveness of
loans, will be made only if the transaction has been approved by a majority
of the then independent and disinterested members of the Board of Directors
and is on terms no less favorable to the Corporation than could have been
obtained from unaffiliated parties.
Stock Options
The following table contains information concerning the grant of stock
options under the Corporation's 1994 Stock Option Plan to the Named Executives
during the Corporation's last fiscal year:
Option Grants in Last Fiscal Year
Individual Grants
------------------------------------------------------------
% of Total Options
Granted to
Employees in
Fiscal Year Exercise Price Expiration
Name Options Granted(#) (of 80,250) ($/Sh) Date
---- ----------------- ----------- ----- ----
Michael Favish 10,000 12.5 $8.00 5/3/06
David G. Forster 10,500 13.1 $8.00 5/3/06
Fred S. Ostern 0 0 N/A N/A
Options granted under the 1994 Stock Option Plan become exercisable in
three equal installments on each of the first, second and third anniversary
of the date of grant. The options were granted at an exercise price equal
to not less than the fair market value of the Common Stock on the date of
grant.
The Corporation does not currently grant stock appreciation rights.
8<PAGE>
Option Holdings
<TABLE>
The following table sets forth information with respect to the Named
Executives concerning the exercise of options during the last fiscal year
and the unexercised options held as of the end of the last fiscal year.
<CAPTION>
Securities Underlying Value of Unexercised In-
Unexercised Options at the-Money Options at FY-
Fy-End (#) End ($)
---------------------- ------------------------
Shares Value
Acquired on Realized Exercisable Unexercisable
Exercisable Unexercisable
Name Exercise(#) ($) (1)
(2)
- ---------------------------------------------------------------------------
- ---------------------------
<S> <C> <C> <C> <C>
<C> <C>
Michael Favish 0 0 103,333 6,667
0 0
David G. Forster 15,000 71,250 29,273 13,727
71,250 0
Fred S. Ostern 0 0 0 0
0 0
________________
</TABLE>
(1) This represents the total number of shares subject to stock options held
by the Named Executives. These options were granted on various dates
during the years 1994 through 1996.
(2) These amounts represent the difference between the exercise price of the
stock options and the closing price of $4.75 of Common Stock on the
Nasdaq National Market on December 31, 1996, for all in-the-money options
held by each Named Executive. The in-the-money stock option exercise
price was $ .01.
Employment Contracts and Termination of Employment and Change-in-Control
Arrangements
The Corporation is party to an employment agreement (the "Favish
Agreement") with Michael Favish, which provides that Mr. Favish will serve as
President and Chief Executive Officer for an initial term of five years
commencing on August 11, 1994. Mr. Favish's annual base salary is $150,000
per year, with annual cost of living increases and additional increases at
the discretion of the compensation committee. For 1997, Mr. Favish's salary
was increased to $165,000 by the compensation committee. Mr. Favish is also
entitled to a bonus at the discretion of the compensation committee and has
been granted options, vesting over a three-year period, to purchase 110,000
shares of Common Stock at per share exercise prices of $5.78 - $8.00.
The Favish Agreement also provides that Mr. Favish will not engage in a
business which competes with the Corporation for the term of the Favish
Agreement and for two years thereafter. In the event that Mr. Favish's
employment is terminated as a result of a Constructive Termination (as
defined in the Favish Agreement), the Favish Agreement provides that the
Corporation will pay Mr. Favish the base salary and bonus compensation
payable to Mr. Favish through the remainder of the term of the Favish
Agreement. In the event that Mr. Favish's employment is terminated following
9<PAGE>
a Change in Control (as defined in the Favish Agreement) of the Corporation,
the Favish Agreement provides that the Corporation will pay Mr. Favish a
termination and non-competition payment equal to the greater of (i) the base
salary and bonus compensation payable to Mr. Favish through the remainder of
the term of the Favish Agreement or (ii) 2.99 times Mr. Favish's base salary
and bonus compensation for the calendar year prior to such termination.
The Ostern Agreement provides that Mr. Ostern will serve as Vice President
of Marketing for a term of three years commencing January 1, 1996. Mr.
Ostern's annual base salary will be $150,000 per year, with increases at the
discretion of the Board of Directors. In addition, Mr. Ostern is entitled to
annual bonus compensation based upon Mr. Ostern's contribution to overhead
and profit. Pursuant to the terms of the Ostern Agreement, such contribution
is equal to the gross annual sales of the Corporation produced by Mr. Ostern
less (i) sales returns, allowances and certain discounts, (ii) the cost of
sales (not including commissions, marketing expenses and general and
administrative expenses) and royalty expenses, and (iii) certain other costs
(as defined in the Ostern Agreement). If the Ostern Agreement is not renewed
by the Corporation and Mr. Ostern at the expiration of its term, the
Corporation is required to pay Mr. Ostern severance and non-competition
payment equal to the annual bonus compensation earned by Mr. Ostern in each
fiscal year of the Corporation after the expiration of the term based upon Mr.
Ostern's contribution to overhead and profit represented by projects which
are in process or invoiced on the last day of Mr. Ostern's term. In
connection with the foregoing payments, Mr. Ostern has also agreed to certain
limited non-competition provisions for a period of one year after the
expiration of the term of the Ostern Agreement. In March 1997, Mr. Ostern
brought an action against the Company in San Diego, California Superior Court
alleging that the Company has breached the employment agreement between the
Company and Mr. Ostern by failing to pay Mr. Ostern the entire amount of
the annual cash bonus for 1996 in accordance with the provisions of his
employment agreement. The claim seeks unspecified damages in excess of
$50,000. A reserve in an amount deemed adequate by the Company has been
recorded for the year ended December 31, 1996. The Company believes that it
has meritorious defenses to the claim which it intends to assert vigorously.
In the opinion of management, except as noted in the following paragraph, the
outcome of the foregoing action will not, in the aggregate, have a material
adverse effect on the Company's financial condition.
Mr. Ostern was instrumental in bringing in approximately $19,000,000 and
$2,000,000 in sales in 1996 and 1995, respectively. Such amounts represented
73% and 26% of total sales in 1996 and 1995, respectively. The Company
anticipates that Mr. Ostern's contribution to the Company's sales will be far
less in 1997 and 1998 than in 1996, due to the non reoccurrence of the toy
car promotions and the anticipated expansion of the Company's sales and
marketing department. Despite the anticipated reduced contribution from Mr.
Ostern in 1997 and 1998, the loss of the services of Mr. Ostern could have a
material adverse effect on the Company's business and prospects.
Director Compensation
Directors who are not employees of the Corporation receive cash
compensation of $6,000 per calendar year and options to purchase 2,500 shares
of Common Stock on July 1 (beginning in 1995) of each of their first three
years of service on the Board of Directors. All directors are reimbursed
for reasonable expenses incurred in connection with attendance of meetings.
10<PAGE>
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Upon recommendation of the audit committee, the Board of Directors has
appointed Hollander, Gilbert & Co. as the Corporation's independent auditors
for the fiscal year ending December 31, 1997.
In the event stockholders do not ratify the appointment of Hollander,
Gilbert & Co. as the Corporation's independent auditors for the forthcoming
fiscal year, such appointment will be reconsidered by the audit committee and
the Board of Directors.
A representative of Hollander, Gilbert & Co. will be present at the Annual
Meeting to respond to appropriate questions and to make such statements as he
may desire.
Board Recommendation
The Board of Directors recommends that the stockholders vote FOR
ratification of the appointment of Hollander, Gilbert & Co. as the
Corporation's independent auditors.
OTHER BUSINESS
The Board of Directors of the Corporation knows of no other matters that
may be presented at the Annual Meeting. However, if any other matters
properly come before the meeting, or any adjournment thereof, it is intended
that proxies in the accompanying form will be voted in accordance with the
judgment of the persons named therein.
11<PAGE>
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the next annual
meeting of the Corporation's stockholders must be received by the Corporation
for inclusion in the Corporation's 1998 Proxy Statement on or prior to March
31, 1998.
ANNUAL REPORTS AND FINANCIAL STATEMENTS
The Annual Report to Stockholders of the Corporation for the year ended
December 31, 1996 was previously mailed to stockholders of record as of
March 21, 1997. A new record date of June 16, 1997 was established for
purposes of mailing the Corporation's 1997 Proxy Statement. Any stockholder
of record on June 16, 1997 who did not previously receive an Annual Report
will be furnished a copy simultaneously herewith. Such report and the
financial statements included therein are not to be considered a part of this
Proxy Statement.
Upon the written request of any stockholder, management will provide,
free of charge, a copy of the Corporation's Annual Report on Form 10-KSB for
the fiscal year ended December 31, 1996, including the financial statements
and exhibits thereto. Requests should be directed to Chief Financial Officer,
Fotoball USA, Inc., 3738 Ruffin Road, San Diego, California 92123.
COST OF SOLICITATION
The cost of soliciting proxies in the accompanying form has been or will
be borne by the Corporation. In addition to solicitation by mail,
solicitations may be made personally, by telephone, by telegraph or by mail
by officers, directors and employees of the Corporation, without additional
remuneration therefor, and arrangements may be made with brokerage houses
and other custodians, nominees and fiduciaries to send proxies and proxy
material to their principals, and the Corporation may reimburse them for
their reasonable out-of-pocket expenses.
It is important that your shares be represented at the meeting. If you
are unable to be present in person, you are respectfully requested to sign
the enclosed proxy and return it in the enclosed stamped and addressed
envelope as promptly as possible.
By Order of the Board of Directors,
KAREN M. BETRO
Secretary
Dated: June 30, 1997
San Diego, California
12<PAGE>
FOTOBALL USA, INC.
ANNUAL MEETING OF STOCKHOLDERS, JULY 31, 1997
The undersigned hereby appoints Michael Favish and David G. Forster, and
each of them, his/her attorneys and proxies with full power of substitution
to vote and act with respect to all shares of common stock of Fotoball USA,
Inc. (the "Corporation") of the undersigned at the Annual Meeting of
Stockholders of the Corporation to be held at 2:00 P.M., local time, on
July 31, 1997 or at any adjournment(s) thereof (the "Meeting"), and instructs
them to vote as indicated on the matters referred to in the Proxy Statement
for the Meeting, receipt of which is hereby acknowledged, with discretionary
power to vote upon such other business as may properly come before the
Meeting or any adjournment(s) thereof.
Receipt of the Notice of Annual Meeting
and Proxy Statement is hereby
acknowledged.
Dated______________________________
______________________________
______________________________
Signature(s) of Stockholder(s)
This Proxy shall be signed exactly as
your name(s) appears hereon, if as
attorney, executor, guardian or in
some representative capacity or as an
officer of a corporation, please add
title as such.<PAGE>
PLEASE VOTE, SIGN AND DATE THIS PROXY AND RETURN IT
IN THE ENCLOSED POSTAGE PAID ENVELOPE.
This Proxy will be voted as specified. IF NO SPECIFICATION IS MADE, THIS
PROXY WILL BE VOTED FOR THE NOMINEE OF THE BOARD OF DIRECTORS IN PROPOSAL 1
AND FOR PROPOSAL 2.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE CORPORATION. The
Board of Directors recommends that you vote FOR the nominee of the Board of
Directors in proposal 1 and FOR proposal 2:
1. To elect one director to hold office until the 2000 Annual Meeting of
Stockholders and until the election and qualification of his successor:
__ FOR the nominee listed below __ WITHHOLD AUTHORITY to
vote for the nominee listed
below
Nominee: Michael Favish
_____________________________________________
2. To ratify the appointment of Hollander, Gilbert & Co. as the Corporation's
independent auditors for fiscal year 1997.
__ FOR __ AGAINST __ ABSTAIN
_____________________________________________
3. To transact such other business as may properly come before the Meeting.
