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 ss. 240.14a-11(c) or ss. 240.14a-12
INTIME SYSTEMS INTERNATIONAL, INC.
(Name of Registrant as Specified In Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
......................................................................
2) Aggregate number of securities to which transaction applies:
......................................................................
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount of 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:
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4) Date Filed:
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<PAGE>
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
OF
INTIME SYSTEMS INTERNATIONAL, INC.
To All Stockholders:
The annual meeting of the stockholders of Intime Systems International,
Inc. (the "Company") will be held at the offices of the Company located at 1601
Forum Place, 5th Floor, West Palm Beach, Florida, on July 1, 1997 at 9:30 a.m.
for the following purposes:
(1) To elect the members to serve on the board of directors of the Company
until the Company's next annual meeting.
(2) To ratify the appointment of Price Waterhouse LLP as independent auditors
for the fiscal year ending December 31, 1997.
(3) To approve an amendment of the Company's 1994 Stock Option Plan increasing
the number of options by 50,000.
(4) For the transaction of other lawful business that may properly come before
the meeting.
The board of directors has fixed the close of business on May 21, 1997
as the record date for a determination of shareholders entitled to notice of,
and to vote at, this meeting or any adjournment thereof.
If you do not plan on attending the meeting, please vote, date, sign
and mail the enclosed proxy card promptly to Mr. Michael Matte, Chief Financial
Officer, InTime Systems International, Inc., 1601 Forum Place, 5th Floor, West
Palm Beach, Florida, 33401.
Dated: May 27, 1997 By Order of the Board of Directors
By: William E. Berry, Secretary
<PAGE>
INTIME SYSTEMS INTERNATIONAL, INC.
PROXY STATEMENT
THE ENCLOSED PROXY IS SOLICITED BY WILLIAM E. BERRY AND JOHN E. STEINER
ON BEHALF OF THE MANAGEMENT OF INTIME SYSTEMS INTERNATIONAL, INC. (THE
"COMPANY") FOR USE AT THE 1997 ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JULY
1, 1997 AT 9:30 A.M. AT THE OFFICES OF THE COMPANY, 1601 FORUM PLACE, 5TH FLOOR,
WEST PALM BEACH, FLORIDA. Such solicitation is being made by mail, and the
Company may also use its officers to solicit proxies from stockholders either in
person or by telephone or letter without extra compensation. All expenses of
this solicitation will be paid by the Company. Since proxies are being solicited
by management (two of whom are directors) and management serves at the will of
the board of directors, management may have a conflict of interest in
recommending how stockholders vote for the proposals. In addition to the
inherent conflict of interest that may arise from board of directors
recommending their own re-election, management and the board of directors may
have a conflict of interest with regard to the resolution to approve expansion
of the 1994 Stock Option Plan (the "Plan"). See Proposal 3. "Amendment of 1994
Stock Option Plan". The Plan provides for the grant to employees of incentive
stock options ("ISOs") within the meaning of Section 422 of the Internal Revenue
Code of 1986, (the "Code"), and for the grant of non-qualified stock options
(collectively "Options"). A proxy may be revoked by delivering a written notice
of revocation to the principal office of the Company or in person at the meeting
at any time prior to the voting thereof.
Only stockholders of record at the close of business on May 21, 1997
(the "Record Date") are entitled to notice of, and to vote at, the meeting. Each
share of Class A and Class B common stock outstanding on the record date is
entitled to one vote and five votes, respectively, on all proposals. Messrs.
William E. Berry and John E. Steiner, the Company's president and chairman of
the board of directors, each are the beneficial owners of 1,218,626 shares of
the Company's Class B stock and 2,000 shares of Class A stock. Accordingly, each
may cast 6,095,130 votes, representing approximately 40% of the voting power
each. As of the close of business on May 21, 1997, 1,823,674 and 2,684,022
shares of Class A and Class B common stock of the Company, respectively, were
outstanding which means that a total of 15,243,784 votes are eligible to be cast
at the meeting. All proposals require a vote of the majority of the stockholders
present in person or by proxy except for the election of directors who shall be
elected by a plurality of such votes.
1
<PAGE>
This proxy statement and the accompanying proxy are first being mailed
to stockholders on or about May 27, 1997.
DIRECTORS AND EXECUTIVE OFFICERS
The executive officers and directors of the Company are as follows:
NAME AGE POSITIONS
- ---- --- ---------
William E. Berry 63 President, Secretary and Director
John E. Steiner 55 Chairman of the Board
Michael Matte 37 Chief Financial Officer
Corine Goldkiller 50 Senior Vice President of Human
Resources Consulting
James C. Dean 39 Vice President
Sherman A. Drusin 54 Director
There is one vacancy on the board of directors.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The following table sets forth as of May 21, 1997 certain information
relating to the beneficial ownership of the Company's Class A and Class B shares
of stock by any person (including any "group") known by the Company (i) to be
the beneficial owner of more than 5% of such securities, (ii) each director and
nominee, (iii) each named executive officer in the Summary Compensation Table,
and (iv) all executive officers and directors as a group.
<TABLE>
<CAPTION>
PERCENTAGE OF
OUTSTANDING
AMOUNT AND CLASS
NATURE OF A AND B
TITLE OF NAME AND ADDRESS BENEFICIAL SECUTIRIES VOTING
CLASS BENEFICIAL OWNER OWNERSHIP(1) OWNED(1)(2) POWER(1)
- -------- ---------------- ------------ --------------- --------
<S> <C> <C> <C> <C>
Class A and William E. Berry 1,220,626(2)(3) 27.1% 40%
Class B Stock 1601 Forum Place
West Palm Beach, FL 33041
Class A and John E. and Carol E. Steiner 1,220,626(2)(4) 27.1% 40%
Class B Stock 1601 Forum Place
West Palm Beach, FL 33041
Class A Stock James C. Dean 28,964(5) * *
and 1601 Forum Place
Vested Options West Palm Beach, FL 33041
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
PERCENTAGE OF
OUTSTANDING
AMOUNT AND CLASS
NATURE OF A AND B
TITLE OF NAME AND ADDRESS BENEFICIAL SECUTIRIES VOTING
CLASS BENEFICIAL OWNER OWNERSHIP(1) OWNED(1)(2) POWER(1)
- -------- ---------------- ------------ --------------- --------
<S> <C> <C> <C> <C>
Class A Stock Corine C. Goldkiller 33,212(6) * *
and 1601 Forum Place
Vested Options West Palm Beach, FL 33041
Class A Stock Mark Murphy 28,333(7) * *
and 6160 St. Andrews Road, #1
Vested Options Columbia, SC 29212
Vested Options Sherman A. Drusin 26,000(8) * *
84 Westchester Business Park
Drive
Armonk, NY 10504
Class A and William J. Hurley 0 0 0
Class B 3150 North A1A
Stock and No. Hutchinson Island, FL 34949
Unvested Options
Class A and All Directors and Executive 2,554,428(8) 55.3% 80.1%
Class B Stock and Officers of the Company as a
Vested group (six persons)
Options
</TABLE>
- ------------
* Less than 1%
(1) Unless otherwise indicated, the Company believes that all
persons named in the table have sole voting and investment
power with respect to all securities beneficially owned by
them. Except as otherwise indicated, each beneficial owner's
percentage ownership is determined by assuming that options,
warrants and convertible securities that are held by such
person (but not those held by any other person) and which are
exercisable or convertible within 60 days have been exercised
or converted.
(2) Includes 929,603 Escrowed Shares (See "Escrowed Shares and
Options") beneficially owned each by Messrs. Steiner and
Berry.
(3) Includes 2,000 shares of Class A Common Stock owned by Mr.
Berry and 1,218,626 shares of Class B Common Stock held in the
name of William E. Berry, Declaration of Trust U/A which is
controlled by William E. Berry, Trustee.
(4) Includes 2,000 shares of Class A Common Stock.
(5) Includes 20,631 (of which 12,892 are Escrowed Shares) and
8,333 shares of Class A Common Stock underlying vested Options
exercisable at $1.76 and $5.25 per share respectively.
3
<PAGE>
(6) Includes 12,378 (of which 7,735 are Escrow Shares) and 20,834
shares of Class A Common Stock underlying vested Options
exercisable at $1.76 and $7.25 per share, respectively.
(7) Includes 11,111 and 6,667 shares of Class A Common Stock
underlying vesting Options exercisable at $5.00 and $5.25 per
share respectively granted to Mr. Mark Murphy who resigned as
an officer on April 15, 1997.
(8) Includes 23,833 shares of Class A Common Stock underlying
vested Options which the Company granted to Mr. Drusin
exercisable at $5.00 - $7.35 per share and excludes shares
underlying 11,166 options held by Mr. Drusin not exercisable
within 60 days.
(9) Includes 25,000 vested Options exercisable at $6.50 - $6.75
per share to Mr. Michael Matte, the Company's chief financial
officer.
ESCROWED SHARES AND OPTIONS
At May 21, 1997, of the currently outstanding 2,715,664 shares of Class
B common stock and 245,788 Options, 1,934,206 shares and 61,225 Options were
held in escrow (the "Escrowed Shares"). The Class B common stock is not
assignable or transferable (but may be voted) until such time, if ever, that the
Shares are released from escrow according to the terms of an Escrow Agreement
dated February 24, 1995. All shares remaining in escrow on March 31, 1999 will
be forfeited and canceled.
The following sets forth the number of Escrowed Shares beneficially
owned by executive officers, directors and principal stockholders of the
Company:
NAME NUMBER OF SHARES OPTIONS
- ---- ---------------- -------
William E. Berry 929,603 0
John E. Steiner 929,603 0
James C. Dean 0 12,892
Corine C. Goldkiller 0 7,735
The rights to these Escrowed Shares are not affected by a change in a
person's status as an employee, officer, director, or his relationship with the
Company, and in the event of such stockholder's death, the terms of the Escrow
Agreement will be binding on such stockholder's executor, administrator, estate
and legatees.
Pursuant to the Escrow Agreement, 60% of the Escrowed Shares (1,133,808
shares and 36,735 Options) will be released from escrow if the Company's Minimum
Pretax Income (as defined below, which definition causes the adjustments set
forth herein) meets or exceeds the following targets:
4
<PAGE>
YEAR ENDING
DECEMBER 31 TARGET
----------- ----------
1997 $6,000,000
1998 $8,500,000
All Escrowed Shares will be released from escrow if any of the
following tests are met:
(i) the Company's Minimum Pretax Income meets or exceeds any
one of the following targets:
YEAR ENDING
DECEMBER 31
-----------
1997 $ 7,300,000
1998 $10,300,000
(ii) beginning August 16, 1996 and ending February 16, 1998, the bid
price of the Class A common stock averages in excess of $16.50 per
share (subject to adjustment in the event of any reverse stock splits
or other similar events) for 30 consecutive business days; or
(iii) there is a sale of the Company that results in stockholders
receiving at least $16.50 per share in cash or marketable securities
between August 16, 1996 and February 16, 1998.
As used above, Minimum Pre-Tax Income for any fiscal year means the
Company's net income, before provision for income taxes and exclusive of any
extraordinary earnings or charges to income resulting from the release of the
Escrowed Shares. Minimum Pre-Tax Income assumes the release of all of the
Escrowed Shares and shall be increased proportionally to reflect the issuance of
any other additional shares of Class A common stock under certain circumstances.
PROPOSAL 1. ELECTION OF DIRECTORS
Four directors are to be elected at the annual meeting. Those persons
elected will hold office until the next annual meeting of stockholders and their
successors have been elected and qualified. The Company's bylaws provide that
the actual number of directors be established by resolution of the board of
directors. The current board of directors has by resolution established the
number of directors at four. One vacancy currently exists. The underwriter of
the Company's initial public offering has the right to designate
5
<PAGE>
one person to the Company's board of directors. None of the current nominees
to the board are Underwriter's designees.
The nominees for the board of directors are set forth below. The proxy
holders intend to vote all proxies received by them for the nominees for
directors listed below unless instructed otherwise. In the event any nominee is
unable or declines to serve as a director at the time of the annual meeting, the
proxies will be voted for any nominee who shall be designated by the present
board of directors to fill the vacancy. In the event that additional persons are
nominated for election as directors, the proxy holders intend to vote all
proxies received by them for the nominees listed below unless instructed
otherwise. As of the date of this proxy statement, the board of directors is not
aware of any nominee who is unable or will decline to serve as a director.
Directors shall be elected by a plurality of the votes cast at the
annual meeting.
NOMINEES TO BOARD OF DIRECTORS
NAME AGE POSITION WITH THE COMPANY SINCE
- ---- --- ------------------------- -----
William E. Berry 63 President, Secretary and 1994
Director
John E. Steiner 55 Executive Vice President, 1994
Treasurer and Chairman of
the Board
Sherman A. Drusin 54 Director 1994
William J. Hurley 57 Management Consultant New Nominee
WILLIAM E. BERRY, the Company's president, secretary and a director of
the Company since January 1994, co-founded The Consulting Team, Inc. ("TEAM"), a
subsidiary of the Company, with John E. Steiner. Mr. Berry has been chairman and
chief executive officer of TEAM from its inception in 1985. In addition to his
duties as president and chief executive officer of the Company, Mr. Berry is
directly involved in the Company's marketing of the Company's consulting
services and its software product. Mr. Berry is the founder and past president
of the South Florida Chapter of the Association of Human Resource Systems
Professionals ("HRSP") and served on the national HRSP Board of Directors from
1988 to 1993. Mr. Berry also served on the SHRM National Committee on Human
Resource Information Systems from 1990-1991.
JOHN E. STEINER has been the Company's executive vice president and
chairman of the board of directors since January 1994. He co-founded TEAM with
Mr. Berry and has been president of
6
<PAGE>
TEAM since its inception in 1985. Mr. Steiner was responsible for development of
TAMS and TAMS/O, the Company's software products. Mr. Steiner has been active in
the American Payroll Association and is a member of The Information Technology
Association of America.
SHERMAN A. DRUSIN was elected a director in April 1994. Since January
1994, Mr. Drusin has been president, director and an estate planner for
Preferred Benefit Plans, Inc., an affiliate of Wallberg Company, Inc., in
Armonk, New York and since February 1997, he has been a corporate finance
consultant. From March 1995 until February 1997, Mr. Drusin was director of
corporate finance for Sterling Foster and Company. From March 1992 through
December 1993, Mr. Drusin was vice president of corporate finance for J. Gregory
& Company, an investment banking firm. From September 1987 through February
1992, Mr. Drusin was president and treasurer of Computer Systems Advisors Group,
Inc. a subsidiary of the Computer Systems Advisors, a company publicly traded on
the Singapore Stock Exchange.
WILLIAM J. HURLEY has been an information systems and management
consultant since March 1995. He has periodically acted as a consultant to the
Company since June 1996. Prior to that time, from April 1988 through December
1995, Mr. Hurley was employed by Bayer, Inc., a large drug company, located in
Tarrytown, New York. His last position was as director for the information
systems division where Mr. Hurley was responsible for information systems,
telecommunications and scientific information (research) management systems.
DIRECTORS' COMPENSATION
In June 1996, the outside directors began receiving $1,250 for each
meeting attended as cash compensation for serving on the Board of Directors in
addition to reimbursement of reasonable expenses incurred in attending meetings.
Pursuant to the Plan, directors who are not employees receive a grant of 12,000
10-year Options which vest in 1/6 increments every June 30 and December 31
provided the director is still serving in that capacity. The 1994 initial grant
of directors' options to the Company's outside directors including Mr. Drusin
fully vested in December 1996. Accordingly they each automatically received a
new grant of 12,000 Options on January 1, 1997, exercisable at approximately
$7.25 per share. With his resignation as a director on April 16, 1997, the
Options granted to Mr. Richard H. Williams in 1997 lapsed. In July 1996, an
additional 10,000 Options were granted to each of Messrs. Drusin and Williams to
compensate them for services performed as directors. The Options are exercisable
at approximately $7.34 per share over a 10-year period and vest as described
above. With Mr. Williams' resignation, 8,333 Options lapsed.
7
<PAGE>
OTHER EXECUTIVE OFFICERS
MICHAEL MATTE became chief financial officer of the Company in October
1996. Prior to joining the Company, Mr. Matte served as chief financial officer
for Torwest, Inc., a U.S. holding company of a Canadian conglomerate from 1992
through October 1995. Prior to that, he served as a senior manager with Price
Waterhouse LLP. Mr. Matte is a CPA and a member of the American and Florida
Institutes of Certified Public Accountants.
CORINE C. GOLDKILLER joined the Company in April 1990. In June 1996,
Ms. Goldkiller was promoted to senior vice president of human resources
consulting of the Company and TEAM. In the fall of 1995, Ms. Goldkiller was
promoted to the position of TEAM's vice president, account management where she
was responsible for the implementation and management of large-scale systems
implementation and generally overseeing ongoing consulting projects. Prior to
her 1995 promotion, Ms. Goldkiller was director of consulting services and held
positions as project manager, client manager, project overseer and senior HRIS
consultant.
JAMES C. DEAN joined the Company in February 1994 as its director of
corporate development and was appointed a vice president in November 1994. From
1985 until joining the Company, Mr. Dean was employed at Policy Management
Systems Corporation ("PMSC"), a publicly-traded company. At the time Mr. Dean
left PMSC, he held the position of assistant vice president.
EXECUTIVE COMPENSATION
The following table sets forth certain information with respect to the
annual and long-term compensation of the Company's chief executive officer and
its four other executive officers (the "Named Executive Officers") whose total
annual salaries and bonuses exceeded $100,000 for the fiscal year ended December
31, 1996.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION
(A) (B) (C) (D) (E) (F) (G)
LONG-TERM
COMPENSATION
AWARDS
SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($) OPTIONS/SARS(#) COMPENSATION($)
--------------------------- ---- --------- -------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
William E. Berry, President
(Chief Executive Officer)........1996 $196,795 $ 0(1) $12,000(2) 0 $4,863(3)
1995 $188,800 $5,665(4) $ 7,132(2) 0 $ 0
1994 $188,800 $ 0 $13,621(2) 0 $ 0
8
<PAGE>
John E. Steiner, Executive Vice
President........................1996 $196,795 $ 0(1) $12,000(2) 0 $2,629(3)
1995 $188,800 $5,665(4) $ 4,893(2) 0 $ 0
1994 $188,800 $ 0 $8,692(2) 0 $ 0
James C. Dean, Vice
President........................1996 $127,500 $ 0 $0 0 $ 0
1995 $120,000 $20,000(5) $0 10,000 $ 0
Corine C. Goldkiller, Senior Vice
President.........................1996 $118,757 $ 0 $0 25,000 $ 0
1995 $103,425 $7,500(5) $0 0 $ 0
Mark Murphy, Vice
President(6).....................1996 $103,000 $ 0 $0 0 $ 0
</TABLE>
- ------------
(1) Pursuant to their employment agreements Messrs. Berry and
Steiner are each entitled to be paid bonuses of approximately
$1,500 in 1997 based on the Company's net income in 1996.
(2) Represents non-cash compensation in the form of a car
allowance and related expenses and in 1994 and 1995, also life
insurance payments.
(3) Represents life insurance payments.
(4) Represents bonuses paid on 1994 net income in accordance with
Messrs. Berry and Steiner's employment agreements.
(5) Represents bonuses related to performance.
(6) Mr. Murphy resigned as an executive officer in April 1997.
The following table sets forth certain information with respect to
stock option grants to the Named Executive Officers during the fiscal year ended
December 31, 1996.
9
<PAGE>
<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
- ---------------------------------------------------------------------------------------------------------------
(A) (B) (C) (D) (E)
% OF TOTAL
NUMBER OF SECURITIES OPTIONS/SARS EXERCISE OR
UNDERLYING OPTIONS/SARS GRANTED TO EMPLOYEES BASE PRICE EXPIRATION
NAME GRANTED IN FISCAL YEAR ($/S(1)(1) DATE
---- ----------------------- -------------------- ----------- ----------
<S> <C> <C> <C> <C>
William E. Berry 0/0 N/A N/A N/A
John E. Steiner 0/0 N/A N/A N/A
James C. Dean 0/0 N/A N/A N/A
Corine C. Goldkiller 25,000/0 9% $7.25 06/03/2006
Mark Murphy 0/0 N/A N/A N/A
</TABLE>
- ------------
(1) All options were granted at 100% of fair market value.
The following table sets forth certain information with respect to the
exercise of Options to purchase common stock and SARs during the fiscal year
ended December 31, 1996, and the unexercised Options held and the value thereof
at that date, for each Named Executive Officer.
<TABLE>
<CAPTION>
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
(A) (B) (C) (D) (E)
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT FY-END(#) OPTIONS/SARS
AT FY-END($)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(#) REALIZED($) UNEXERCISABLE(1) UNEXERCISABLE(2)
---- --------------- ----------- ---------------- ----------------
<S> <C> <C> <C> <C>
William E. Berry 0 0 0 0
John E. Steiner 0 0 0 0
James C. Dean 0 0 14,405/16,226 $42,482/$77,446
Corine C. Goldkiller 0 0 12,976/24,402 $15,057/$45,162
Mark Murphy 0 0 17,778/12,222 $45,000/$26,660
</TABLE>
- ------------
(1) Exercisable options include all currently vested Options
without restrictions. Unexercised Options includes non-vested
Options and Options which are held in escrow.
(2) Based upon a fair market value at fiscal year end of $7.25
per share minus the exercise price.
10
<PAGE>
EMPLOYMENT AND CONSULTING AGREEMENTS
The Company employs Messrs. Berry and Steiner pursuant to three year
written employment agreements expiring in February 1998. The agreements with Mr.
Berry and Mr. Steiner provide for a base annual salary of $188,000 subject to
cost of living increases. Both may terminate their respective agreements if: (i)
such persons' duties are substantially modified, (ii) the Company materially
breaches such agreements or (iii) if any entity or person not currently an
executive officer or stockholder of the Company either individually or as part
of a group becomes the beneficial owner of 40% or more of the common stock of
the Company. In such an event, they may elect to either: (a) receive full
compensation and benefits payable under their employment agreements for the
remainder of the term of the agreements or (b) a release from the
non-competition provisions of their respective agreements. The effect of such
provisions may discourage a hostile takeover even if in the best interest of all
other stockholders.
Mr. Michael Matte, the Company's chief financial officer receives an
annual salary of $130,000. Ms. Corine C. Goldkiller, the Company's senior vice
president of human resources consulting, is employed at the rate of $125,000 per
annum, and Mr. James Dean, a vice president, receives an annual salary of
$127,500.
STOCK OPTION PLAN
The Company adopted the Plan in 1994 for employees, consultants and
directors, covering 300,000 Options. Subsequently, the board of directors
increased the Options by an additional 150,000 shares covered under the Plan.
Stockholder ratification of the 50,000 Option increase is being sought at the
annual meeting so that the Options will meet the Code's requirements for grants
of ISOs. See Proposal 3. Amendment of 1994 Stock Option Plan.
The Plan is intended to comply with Section 16(b) of the Securities
Exchange Act of 1934, and Rule 16b-3 promulgated thereunder and other applicable
laws and is administered by the board of directors. The board of directors has
the power to determine eligibility to receive Options, the terms of any Options
including the exercise price, the number of Options, the vesting schedule and
the term of any such Options. The exercise price of all Options granted under
the Plan must be at least equal to the fair market value of the shares of Class
A common stock on the date of such grant. If a grant is made to an employee
owning stock representing more than 10% of the voting power of the Company's
outstanding stock, the exercise price of any ISO granted must equal at least
110% of the fair market value on the grant date and the maximum term of the ISO
must not exceed five years. The terms of all other Options granted under the
Plan may not exceed 10 years.
11
<PAGE>
Currently, the Company has 79,585 outstanding Options exercisable at
$1.76 of which 46,731 are in escrow and 309,067 outstanding Options exercisable
at $5.00 - $7.50 per share. All Options vest at the rate of one-sixth each June
30th and December 31st subject to continued employment. A portion (62%) of the
Options exercisable at $1.76 per share are subject to the Escrow Agreement
between the Company and the Underwriter of its initial public offering.
The following table gives information as to all Options to purchase the
Company's Class A common stock which were granted to each outside director (and
former director) of the Company pursuant to both the automatic grant provisions
of the Plan and any discretionary grants.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
OUTSIDE DIRECTORS OPTIONS OUTSTANDING
AS OF MAY 21, 1997(1)
- --------------------------------------------------------------------------------------------------------------------------------
AVERAGE OPTION
TYPE OF DATE OF EXERCISE PRICE
NAME GRANT GRANT NUMBER PER SHARE
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Sherman A. Drusin Formula May 24, 1994 12,000 $ 5.00
-----------------------------------------------------------------------------------------------
Discretionary November 17, 1995 13,000 $6.875
-----------------------------------------------------------------------------------------------
Discretionary July 17, 1996 10,000 $7.344
-----------------------------------------------------------------------------------------------
Formula January 1, 1997 12,000 $7.25
- --------------------------------------------------------------------------------------------------------------------------------
Richard H. Williams Formula January 24, 1994 12,000 $ 5.00
-----------------------------------------------------------------------------------------------
(former director) Discretionary November 17, 1995 13,000 $6.875
-----------------------------------------------------------------------------------------------
Discretionary July 17, 1996 1,667 $7.344
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ------------
(1) As of May 21, 1997, none of these Options have been exercised.
401(K) SAVINGS PLAN
The Company maintains an employee savings plan (the "401(k) Plan")
under Section 401(k) of the Code. The 401(k) Plan covers all employees who meet
certain service requirements and is funded by employee contributions, matching
Company contributions and discretionary annual contributions from the Company in
amounts determined by the board of directors. The 401(k) Plan provides that a
participant may make voluntary contributions over one year in amounts ranging
from 2% to 15% of their annual compensation
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during the Plan year. The Company may make a matching contribution equal to a
percentage of the elective contributions made by the participants. The
discretionary contributions are allocated following the end of the 401(k) Plan
year to all participants eligible to share therein in the same proportion that
each participant's compensation bears to the compensation of all eligible
participants vested at all times. The participants' interest in the Company's
matching contribution and discretionary contribution vests ratably over a five
year period. Benefit distributions under the 401(k) Plan are in the form of lump
sums or a life annuity. The 401(k) Plan was adopted as of June 1, 1992. For 1996
approximately $60,000 in matching contributions or discretionary contributions
were made by the Company to the 401(k) Plan. The Company may make an additional
discretionary annual contribution.
BOARD MEETINGS AND COMMITTEES
The board of directors of the Company held nine meetings during the
fiscal year ended December 31, 1996. Additionally, three unanimous consents in
lieu of a formal meeting were executed. All directors attended each of the
meetings of the board of directors held during this period either in person or
by telephone. The Company has established an Audit and Compensation Committee.
Mr. Drusin is a member of each Committee with one vacancy.
RELATED PARTY TRANSACTIONS
During 1996 and to date, the Company has employed three of Mr. John E.
Steiner's adult children in various non-management positions. Two of these
individuals reported to Mr. Steiner. The aggregate compensation paid to Mr.
Steiner's children in 1996 was $77,774. In connection with moving all the
Company's accounting and financial functions from its South Carolina office to
its corporate headquarters in West Palm Beach, one of Mr. Steiner's children
have resigned.
Mr. Steiner also is in the process of moving to West Palm Beach and the
Company has authorized reimbursement of Mr. Steiner's actual rental expenses up
to a maximum of $1,500 per month for seven months and other expenses to the
extent they duplicate expenses paid by him for his South Carolina residence.
Additionally, the board of directors approved payment to Mr. Steiner of other
relocation expenses not to exceed $65,000.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
To the best of the Company's knowledge based on a review of its files,
all filings of Form 3, 4 and 5 required to be made with the Securities and
Exchange Commission have been made.
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PROPOSAL 2. APPOINTMENT OF AUDITORS
Price Waterhouse LLP ("Price") independent public accountants,
currently acts as the independent auditors of the Company and has been selected
by the board of directors to act as auditors for the fiscal year ended December
31, 1997 subject to stockholder approval. Unless directed to vote no, proxies
being solicited will be voted in favor of the ratification of Price as
independent auditors for the Company's fiscal year ended December 31, 1997.
Price acted as auditors for the Company for the fiscal year ended December 31,
1996. A representative of Price will be present at the meeting to respond to
questions.
Ratification of the appointment of Price as the Company's independent
accountants for fiscal 1997 will require the affirmative vote of at least a
majority of the votes represented in person or by proxy at the annual meeting.
Proxies solicited by management will be voted for the proposal unless instructed
otherwise.
PROPOSAL 3. AMENDMENT OF 1994 STOCK OPTION PLAN
In 1994, the Company established the Plan covering 300,000 shares of
Class A common stock. The Plan was increased to 400,000 Options in 1995. The
board of directors approved an additional increase of 50,000 Options in 1996.
See "Stock Option Plan". Ratification and approval by the stockholders is being
sought for the 1996 increase of 50,000 Options under the Plan. Pursuant to new
rules recently promulgated by the Securities and Exchange Commission stockholder
approval is not required for amendment of a Company's Plan including an
amendment to increase the size of the Plan. However, the Code requires
stockholder approval if the Options to be granted are treated as ISOs rather
than non-qualified Options. Management believes it is in the best interest of
the Company's employees to grant ISOs whenever possible because no tax to the
employee is recognized upon exercise of the ISOs.
An affirmative vote of the holders of at least a majority of the votes
represented in person or by proxy at the annual meeting is required to approve
the proposed amendment to the Plan.
PROPOSAL 4. OTHER MATTERS
The board of directors has no knowledge of any other matters which may
come before the meeting and does not intend to present any other matters.
However, if any other matters shall properly come before the meeting or any
adjournment thereof, the persons soliciting proxies will have the discretion to
vote as they see fit unless directed otherwise.
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If you do not plan to attend the meeting, in order that your shares may
be represented and in order to assure the required quorum, please sign, date and
return your proxy promptly. In the event you are unable to attend the meeting,
at your request, the Company will cancel the proxy.
STOCKHOLDERS' PROPOSALS
Any stockholder of the Company, who wishes to present a proposal to be
considered at the 1998 annual meeting of the stockholders of the Company and who
wishes to have such proposal presented in the Company's proxy statement for such
meeting, must deliver such proposal in writing to the Company no later than
December 31, 1997.
The Company will furnish, without charge to any stockholder submitting
a written request a copy of the Company's annual report on Form 10-KSB as filed
with the Securities and Exchange Commission including financial statements and
schedules thereto. Such written request should be directed to Mr. Michael Matte,
InTime Systems International, Inc., 1601 Forum Place, 5th Floor, West Palm
Beach, Florida, 33401.
By the Order of the Board of Directors
William E. Berry, Secretary
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PROXY SOLICITED BY THE BOARD OF DIRECTORS OF
INTIME SYSTEMS INTERNATIONAL, INC.
FOR THE ANNUAL MEETING OF STOCKHOLDERS ON JULY 1, 1997
The undersigned hereby appoints William E. Berry and John E. Steiner as
my proxy with power of substitution for and in the name of the undersigned to
vote all shares of Class A and Class B common stock of Intime Systems
International, Inc. (the "Company") which the undersigned would be entitled to
vote at the annual meeting of shareholders of the Company to be held at the
Company's offices located at 1601 Forum Place, 5th Floor, West Palm Beach,
Florida on July 1, 1997 at 9:30 a.m., and at any adjournment thereof, upon such
business as may properly come before the meeting, including the items set forth
below:
EACH SHARE OF CLASS A COMMON STOCK AND CLASS B COMMON STOCK OUTSTANDING ON THE
RECORD DATE IS ENTITLED TO ONE VOTE OR FIVE VOTES, RESPECTIVELY, ON ALL
PROPOSALS.
1. I hereby elect the following individuals to serve on the board of directors
of the Company until the Company's next annual meeting.
NAME YES NO
---- --- --
a) William E. Berry ____ ____
b) John E. Steiner ____ ____
c) Sherman A. Drusin ____ ____
d) William J. Hurley ____ ____
2. I hereby ratify the appointment of Price Waterhouse LLP as independent
auditors for the fiscal year ended December 31, 1997.
Yes ____ No ____ Abstain ____
3. I hereby approve amendment of the Company's 1994 Stock Option Plan increasing
the number of options by 50,000 options to an aggregate of 450,000 options.
Yes ____ No ____ Abstain ____
4. I hereby authorize the transaction of any other lawful business that may
properly come before the annual meeting of shareholders.
Yes ____ No ____ Abstain ____
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(Shares cannot be voted unless this proxy is signed and returned, or specific
arrangements are made to have the shares represented at the meeting).
If no direction is indicated, this Proxy will be voted as recommended by the
board of directors for all proposals.
Dated: _____________________________, 1997
_____________________________________
Signature of Shareholder
_____________________________________
Typed or Printed Name of Shareholder
_____________________________________
Number of Class A Shares Owned
_____________________________________
Number of Class B Shares Owned
