TRACK DATA CORPORATION
95 ROCKWELL PLACE
BROOKLYN, NEW YORK 11217
INFORMATION STATEMENT
This information statement is provided by the Board of Directors of Track
Data Corporation, a Delaware corporation, in connection with a proposed
stockholder action by written consent to authorize and approve an amendment to
the Company's Certificate of Incorporation to increase the authorized Common
Stock to 60,000,000 shares of $.01 par value Common Stock.
Stockholdings representing approximately 77% of the total outstanding votes
of all issued and outstanding Common Stock of the Company have consented to the
proposal and are sufficient to take the proposed action. The Board of Directors
does not intend to solicit any proxies or consents from any other stockholders
in connection with this action.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY.
The Company's principal executive office address is 95 Rockwell Place,
Brooklyn, New York, 11217. This Information Statement will be mailed to the
Company's stockholders on or about May 5, 1999.
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PROPOSAL CONCERNING INCREASE IN NUMBER OF
AUTHORIZED SHARES OF COMMON STOCK
The Board of Directors has adopted a proposal declaring advisable an
amendment to the Company's Certificate of Incorporation to increase the number
of authorized shares of Common Stock of the Company to 60,000,000 shares of
Common Stock, with a par value of $.01 per share (the "Proposed Stock
Amendment"). The form of the Proposed Stock Amendment is attached hereto as
Exhibit A.
At March 31, 1999, the authorized Common Stock of the Company consisted of
30,000,000 shares of Common Stock, par value $.01 per share. As of March 31,
1999, 14,897,649 shares of Common Stock were outstanding. In addition, as of
March 31, 1999 an aggregate of 1,972,979 shares of Common Stock were reserved
for issuance upon: (i) exercise of options granted or which may be granted under
the Company's Stock Option Plans (1,861,979 shares); and (ii) exercise of
various other outstanding warrants and options (111,000 shares). The Board of
Directors proposed to increase the number of its authorized shares of Common
Stock in order to be able to have adequate Common Stock available to meet its
current obligations to issue Common Stock and in order to utilize equity
issuances in future financings and acquisitions and for stock dividends or
splits.
If the Proposed Stock Amendment is adopted by the Company's stockholders,
the additional shares of Common Stock would be issuable at any time and from
time to time, by action of the Board of Directors without further authorization
from the Company's stockholders, except as otherwise required by applicable law
or rules and regulations to which the Company may be subject, to such persons
and for such consideration (but not less than the par value thereof) as the
Board of Directors determines. Holders of Common Stock of the Company have no
preemptive rights to acquire or subscribe to any of the additional shares of
Common Stock.
Issuance of additional Common Stock, directly or upon exercise of warrants
or options, would have a dilutive effect on the voting power of the outstanding
Common Stock of the Company. Depending upon the number of shares of the
Company's Common Stock issued and the amount of any additional consideration to
be paid upon the conversion of any shares of Preferred Stock, if and when
issued, into shares of Common Stock (if the Board of Directors affords
conversion privileges for Preferred Stock) and the relationship thereof to the
book value of the Common Stock, it is possible that issuance of any of the
Common Stock, either directly or upon conversion of any Preferred Stock, could
have a dilutive effect on stockholders' equity in the Company.
CONSIDERATIONS
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If the Proposed Stock Amendment is not approved, the Company will have a
limited number of authorized shares of Common Stock available for future use by
the Company. The Company's management believes that the authorization of the
additional shares of Common Stock are in the best interests of the Company and
its stockholders so that sufficient shares will be readily available for use, if
feasible, in acquisitions, in raising additional capital and for grants as
incentives to employees, officers, directors and consultants of the Company, as
well as for stock dividends or splits.
From time to time the Company may consider acquisitions or other
transactions which may require the issuance of shares of Common Stock. The
Company's management believes that the increase in the number of authorized
shares of Common Stock is in the best interests of the Company and its
stockholders since additional shares of Common Stock will be available for use,
if feasible, in acquisitions and in raising additional capital and will provide
the Company with the flexibility of having a broader choice in the type and
number of equity securities available to it for the above and other corporate
purposes.
Due to the Board of Directors' discretion in connection with the issuance
of additional shares of Common Stock and in connection with the issuance and the
relative rights and preferences of the Preferred Stock, such as its ability to
cause the Common Stock or Preferred Stock to be issued in a private placement or
to determine the convertibility of the Preferred Stock, it may, under certain
circumstances, possess timing and other advantages in responding to a tender
offer or other attempt to gain control of the Company, which may make such
attempts more difficult and less attractive. For example, issuance of additional
shares would increase the number of shares outstanding and could necessitate the
acquisition of a greater number of shares by a person making a tender offer and
could make such acquisition more difficult since the recipient of such
additional shares may favor the incumbent management. Moreover, these
advantages, including the right to grant voting powers to the holders of the
Preferred Stock, gives the Board of Directors the ability to provide any such
holders with a veto power over actions proposed to be taken by the holders of
the Company's Common Stock. This could have the effect of insulating existing
management from removal even if it is in the best interest of the common
stockholders. Management of the Company is not aware of any existing or
threatened efforts to obtain control of the Company.
APPROVAL REQUIRED
The approval of a majority of the outstanding stock entitled to vote will
be necessary to approve the proposed amendment. As discussed above, the
Company's Board of Directors has obtained written consent for the amendment to
the Certificate of Incorporation from Mr. Barry Hertz, Chairman, CEO and
principal stockholder of the Company with voting authority for stock
representing approximately 77% of the votes of the Company's outstanding Common
Stock. The Board of Directors does not intend to solicit any proxies or consents
from any other stockholders in connection with this action.
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Exhibit A
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CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
TRACK DATA CORPORATION
Track Data Corporation, a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY:
FIRST: That pursuant to the recommendation of the Board of Directors of Track
Data Corporation, the following resolution amending the Certificate of
Incorporation of said corporation, has been adopted by the written consent of
stockholders of said corporation holding a majority of the outstanding stock
entitled to vote thereon. The resolution setting forth the amendment is as
follows:
RESOLVED, that Article Fourth (a) of the Certificate of Incorporation shall be
amended to read in its entirety as follows:
"(a) The total number of shares of stock which the Corporation shall have
authority to issue is 60,000,000 shares of Common Stock, and 1,000,000 shares of
Preferred Stock, all par value $.01 per share."
SECOND: That these resolutions have been adopted by written consent of
stockholders holding a majority of the outstanding stock entitled to vote
thereon in accordance with Sections 216 and 228 of the General Corporation Law
of the State of Delaware.
THIRD: That said amendment was duly adopted in accordance with the provisions of
Section 242 of the General Corporation Law of the State of Delaware.
FOURTH: That the capital of said corporation shall not be reduced under or by
reason of said amendment.
IN WITNESS WHEREOF, said Track Data Corporation has caused this certificate to
be signed by its Vice President, and its Assistant Secretary, this day
of May, 1999.
Track Data Corporation
By: /s/ Attest: /s/
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Martin Kaye, Vice President Cindy Belmore, Assistant Secretary
