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SCHEDULE 14A INFORMATION
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
[ ] 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 Section 240.14a-11(c) or Section
240.14a-12
F.Y.I. INCORPORATED
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(l) and
0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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* Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] 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.
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LOGO
March 26, 1999
Dear Stockholder:
You are cordially invited to attend the 1999 Annual Meeting of Stockholders
of F.Y.I. Incorporated (the "Company"), which will be held at the Melrose
Hotel, 3015 Oak Lawn Avenue, Dallas, Texas 75219, on Wednesday, May 12, 1999,
commencing at 10:00 a.m. (local time). We look forward to greeting as many of
our stockholders as are able to be with us.
At the meeting, you will be asked to consider and vote upon: (1) the
election of nine (9) Directors; and (2) such other business as may properly
come before the meeting and any adjournment thereof.
We hope you will find it convenient to attend the meeting in person.
WHETHER OR NOT YOU EXPECT TO ATTEND, TO ASSURE YOUR REPRESENTATION AT THE
MEETING AND THE PRESENCE OF A QUORUM, PLEASE COMPLETE, DATE, SIGN AND MAIL
PROMPTLY THE ENCLOSED PROXY, for which a return envelope is provided. No
postage need be affixed to the Proxy if it is mailed in the United States.
The Company's Annual Report to Stockholders for the fiscal year ended
December 31, 1998 is being mailed to you together with the enclosed proxy
materials.
Sincerely,
/s/ THOMAS C. WALKER
Thomas C. Walker
Chairman and Chief Development Officer
/s/ ED H.BOWMAN, JR.
Ed H. Bowman, Jr.
President and Chief Executive Officer
3232 MCKINNEY AVENUE o SUITE 900 o DALLAS, TEXAS 75204
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F.Y.I. INCORPORATED
3232 MCKINNEY AVENUE, SUITE 900
DALLAS, TEXAS 75204
----------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 12, 1999
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of F.Y.I.
Incorporated, a Delaware corporation (the "Company"), will be held at the
Melrose Hotel, 3015 Oak Lawn Avenue, Dallas, Texas 75219 on Wednesday, May 12,
1999, at 10:00 a.m. (local time), for the following purposes:
(1) To elect nine (9) Directors, each to serve for a term of one year
and until his successor is duly elected and qualified; and
(2) To transact such other business as may properly come before the
Annual Meeting and any adjournment thereof.
The Company's Annual Report to Stockholders for the fiscal year ended
December 31, 1998, Proxy Statement and form of Proxy are being mailed together
with this Notice.
Only stockholders of record as of the close of business on March 15, 1999
are entitled to notice of, and to vote at, the Annual Meeting and any
adjournment thereof. Such stockholders may vote in person or by proxy.
You are cordially invited to be present at the Annual Meeting. It is
important to you and to the Company that your shares be voted at the Annual
Meeting.
By Order of the Board of Directors
/s/ MARGOT T. LEBENBERG
Margot T. Lebenberg
Senior Vice President,
General Counsel and Secretary
March 26, 1999
IMPORTANT NOTICE:
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE URGED
TO READ THE ATTACHED PROXY STATEMENT CAREFULLY AND THEN TO SIGN, DATE AND
RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED STAMPED AND ADDRESSED ENVELOPE.
AS SET FORTH IN THE PROXY STATEMENT, THE GIVING OF THE PROXY WILL NOT AFFECT
YOUR RIGHT TO ATTEND AND TO VOTE AT THE ANNUAL MEETING.
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F.Y.I. INCORPORATED
---------------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 12, 1999
This Proxy Statement and the accompanying form of proxy ("Proxy") are being
furnished to the stockholders of F.Y.I. Incorporated, a Delaware corporation
("F.Y.I." or the "Company"), in connection with the solicitation of Proxies by
the Board of Directors of the Company for use at the Annual Meeting of
Stockholders (the "Annual Meeting") to be held at the Melrose Hotel, 3015 Oak
Lawn Avenue, Dallas, Texas 75219, on Wednesday, May 12, 1999, at 10:00 a.m.
(local time), and at any adjournment thereof. Only stockholders of record as of
the close of business on March 15, 1999 (the "Record Date") will be entitled to
notice of, and to vote at, the Annual Meeting.
This Proxy Statement and the accompanying Proxy materials, together with a
copy of the Company's Annual Report to Stockholders for the fiscal year ended
December 31, 1998 (the "Annual Report"), are being sent or given to
stockholders of the Company commencing on or about April 2, 1999.
At the Annual Meeting, the stockholders of the Company will be asked to
consider and vote upon: (i) the election of nine (9) Directors of the Company;
and (2) such other business as may properly come before the Annual Meeting and
any adjournment thereof.
The principal executive offices of the Company are located at 3232 McKinney
Avenue, Suite 900, Dallas, Texas 75204, and the Company's telephone number at
that address is (214) 953-7555.
STOCKHOLDERS ARE REQUESTED TO COMPLETE, DATE AND SIGN THE ACCOMPANYING FORM
OF PROXY AND RETURN IT PROMPTLY TO THE COMPANY IN THE ENCLOSED POSTAGE-PAID
ENVELOPE.
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VOTING RIGHTS AND VOTES REQUIRED
Holders of record of the Common Stock as of the close of business on the
Record Date will be entitled to one vote for each share held on all matters to
come before the Annual Meeting. As of the close of business on the Record Date,
there were 14,103,129 shares of the Common Stock outstanding (including 36,670
shares of the Common Stock held by a wholly-owned subsidiary of the Company).
The presence, in person or by Proxy, of stockholders entitled to cast a
majority of all votes entitled to be cast at the Annual Meeting will constitute
a quorum. Assuming a quorum, the nominees receiving a plurality of the votes
cast at the Annual Meeting for the election of Directors will be elected as
Directors.
With regard to the election of Directors, votes may be cast in favor or
withheld; votes that are withheld will be counted for purposes of determining
the presence or absence of a quorum but will have no other effect. Broker
non-votes, if any, will be counted for purposes of determining the presence or
absence of a quorum but will have no effect on the outcome of the election of
Directors.
VOTING OF PROXIES
If the accompanying Proxy is properly executed and returned, the shares
represented thereby will be voted in accordance with the instructions specified
in the Proxy. In the absence of instructions to the contrary, such shares will
be voted in favor of the nominees for election to the Board of Directors listed
in this Proxy Statement and named in the accompanying Proxy. The Board of
Directors does not intend to bring any other matters before the Annual Meeting
and is not aware of any matters that will come before the Annual Meeting other
than as described herein. In the absence of instructions to the contrary,
however, it is the intention of each of the persons named in the accompanying
Proxy to vote all properly executed Proxies on behalf of the stockholders they
represent in accordance with their discretion with respect to any such other
matters properly coming before the Annual Meeting.
REVOCATION OF PROXIES
Any stockholder may revoke such stockholder's Proxy at any time prior to
the voting thereof on any matter (without, however, affecting any vote taken
prior to such revocation). A Proxy may be revoked by filing with Margot T.
Lebenberg, Senior Vice President, General Counsel and Secretary of F.Y.I.
Incorporated, at 3232 McKinney Avenue, Suite 900, Dallas, Texas 75204, a
written notice of revocation or a subsequently dated, executed Proxy at any
time prior to the time it has been voted at the Annual Meeting, or by attending
the Annual Meeting and voting in person (although attendance at the Annual
Meeting will not in and of itself constitute revocation of a Proxy).
SOLICITATION OF PROXIES
The accompanying Proxy is solicited by the Board of Directors, and the cost
of such solicitation will be borne by the Company. Proxies may be solicited by
Directors, officers and employees of the Company, none of whom will receive any
additional compensation for his or her services. Solicitation of Proxies may be
made personally or by mail, telephone, facsimile or messenger. The Company will
pay persons holding shares of the Common Stock in their names or in the names
of nominees, but not owning such shares beneficially, such as brokerage houses,
banks and other fiduciaries, for the reasonable expense of forwarding
soliciting materials to their principals. The Company has engaged American
Stock Transfer and Trust Company as proxy solicitor for a fee of approximately
$1,000 plus out-of-pocket costs and expenses.
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PROPOSAL 1 -- ELECTION OF DIRECTORS
Nine Directors are to be elected to hold office until the next annual
meeting and until their respective successors are elected and qualified.
The following information is furnished with respect to the nine nominees
for election as Directors. The Board of Directors has recommended the nominees
named below. Unless otherwise instructed, it is the intention of the persons
named in the accompanying Proxy to vote all shares of the Common Stock
represented by properly executed Proxies for the nominees named below. Although
such nominees have indicated that they will serve as Directors of the Company,
should any of them be unable to serve, the Proxies will be voted for the
election of a substitute nominee designated by the Board of Directors or the
Board of Directors will elect to reduce the number of Directors constituting
the Board of Directors. There is no cumulative voting for Directors.
Nominees for Directors
Thomas C. Walker, age 66, has been Chairman of the Board of the Company
since its inception in September 1994 and has been Chief Development Officer of
the Company since November 1995. From September 1994 until November 1995, Mr.
Walker held the positions of President and Chief Executive Officer of the
Company. From August 1991 to December 1994, Mr. Walker was Vice President,
Corporate Development, of Laidlaw Waste Systems, Inc., a subsidiary of Laidlaw,
Inc., a waste management company, where he was responsible for its acquisition
and divestiture program in the United States and Mexico. From May 1989 until he
joined Laidlaw Waste Systems, Inc., Mr. Walker was President of Thomas C.
Walker Associates, Inc., a company providing merger, acquisition and financial
consulting services focusing on the waste management industry. During his
career, Mr. Walker has been responsible for the acquisition or divestiture of
over 150 businesses over a 30-year period. Mr. Walker holds a B.S. in
Industrial Engineering from Lafayette College.
Ed H. Bowman, Jr., age 52, has been President and Chief Executive Officer
and a Director of the Company since November 1995. From May 1993 to June 1995,
Mr. Bowman was Executive Vice President and Chief Operating Officer of the
Health Systems Group of First Data Corporation, a financial services company.
Mr. Bowman was responsible for the day-to-day operations of research and
development, marketing and customer service. From 1983 to 1993, Mr. Bowman
served in a number of executive positions with HBOC, a healthcare systems and
services company, including VP - International, VP - Marketing, Senior VP -
Customer Services, Group Senior VP - Research and Development, and last serving
as Executive Vice President and Chief Operating Officer with responsibility for
domestic operations. Prior to joining HBOC, Mr. Bowman was with Andersen
Consulting for 10 years, where he was elected a Partner. Mr. Bowman became a
C.P.A. in 1973 and holds an M.S. from Georgia Institute of Technology and a
B.B.A. from Georgia State University. Mr. Bowman is a board member of 711.Net,
an internet company, and is an investor and former board member of several
early-stage, high-technology companies.
David Lowenstein, age 37, has been Executive Vice President - Corporate
Development and Acquisitions and a Director of the Company since February 1995.
In November 1997, Mr. Lowenstein was named Treasurer. From July 1996 through
November 1997, Mr. Lowenstein held the additional position of Chief Financial
Officer of the Company. Prior to joining the Company, Mr. Lowenstein served,
since February 1994, as Vice President, Business Development of Laidlaw Waste
Systems, Inc., with overall responsibility for Laidlaw Waste System's
acquisition and divestiture program in North America. From April 1990 until
February 1994, Mr. Lowenstein served in a variety of capacities, including
Director - Corporate Development, for Laidlaw, Inc. From November 1988 to March
1990, he served as a business analyst for Tricil, Ltd., a solid and hazardous
waste company that was acquired by Laidlaw, Inc. in 1990. Mr. Lowenstein has
been responsible for the acquisition or divestiture of over 75 businesses in
North America and Europe. Mr. Lowenstein holds a B.A. in Economics from Sir
Wilfred Laurier University and an M.S. in Public and Business Administration
from Carnegie Mellon University. Mr. Lowenstein is a citizen of the Dominion of
Canada.
G. Michael Bellenghi, age 50, has been a Director of the Company and the
Chairman of the Board and Chief Executive Officer of Recordex Acquisition Corp.
("Recordex"), a wholly-owned subsidiary of the Company, since the closing of
the Company's initial public offering (the "IPO"). Prior to joining Recordex's
predecessor in October 1991, Mr. Bellenghi served as Partner-in-Charge and
Director of Deloitte & Touche's Philadelphia office Healthcare Practice for 10
years. Mr. Bellenghi has also served as a graduate professor in Financial
Management of Healthcare Institutions at LaSalle University. Mr. Bellenghi is a
director of Home Health Corporation of America, Inc., a publicly-held company.
Mr. Bellenghi is a certified public accountant and holds a B.A. in Accounting
from LaSalle University.
Gregory R. Melanson, age 45, has been a Director of the Company since the
closing of the IPO. Mr. Melanson is currently a consultant and was a Senior
Vice President of the Company from February 1998 through October 1998. From the
IPO through November 1998, Mr.
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Melanson was Chairman of the Board, President and Chief Executive Officer of
Researchers Acquisition Corp. ("Researchers"), a wholly-owned subsidiary of the
Company. Prior to the IPO and since 1978, Mr. Melanson held such offices with
the predecessor of Researchers. Since January 1999, Mr. Melanson has been a
consultant to the Company. Mr. Melanson has been in the litigation support
services business since 1975. Mr. Melanson holds a B.A. from the University of
Southern California.
Jonathan B. Shaw, age 43, has been a Director of the Company. From the IPO
through January 1999, Mr. Shaw was President and Chief Executive Officer and
the Chairman of the Board of Imagent. Since January 1999, Mr. Shaw has been a
business segment leader and an officer of several subsidiaries of the Company.
Prior to the IPO and since 1990, Mr. Shaw held such offices with the
predecessor of Imagent. Mr. Shaw has been active with Imagent for 16 years. Mr.
Shaw attended the University of Vermont and George Washington University.
Michael J. Bradley, age 54, has been a Director of the Company since the
closing of the IPO. Since January 1991, Mr. Bradley has served as a principal
and as a member of the Board of Directors of the predecessor of Recordex.
Currently, Mr. Bradley is the Executive Associate to the President of MCP
Hahnemann University and is Vice-Chairman and a director of Republic Bancorp
Inc., a bank holding company. From May 1994 through 1997, Mr. Bradley was
Executive Vice President of Mercy Health Corporation of Southeast Pennsylvania.
Prior to joining Mercy Health Corporation, Mr. Bradley served as President and
Chief Executive Officer of several healthcare organizations, including Thomas
Jefferson University Hospital and North Philadelphia Health System, both of
which are located in Philadelphia, and the Columbia Presbyterian Medical Center
in New York City. Mr. Bradley is a certified public accountant and holds a B.S.
in Business Administration from Drexel University.
Donald F. Moorehead, Jr., age 48, has been a Director of the Company since
January 1995. Since January 1998, Mr. Moorehead has been Vice Chairman of the
Board and has assumed his current position of Chairman of the Board and Chief
Executive Officer on July 1, 1998 of EarthCare Company, a liquid waste company.
Mr. Moorehead is the founder of U.S.A. Waste Services, Inc., which upon
acquiring Waste Management, Inc. will be the largest solid waste company in the
world, whose shares are listed on the New York Stock Exchange. From October
1990 through May 1994, he served as its Chairman of the Board and Chief
Executive Officer. Mr. Moorehead was Chairman of the Board and Chief Executive
Officer of Mid-American Waste Systems, Inc., a waste management company, from
its inception in December 1985 until August 1990 and continued as a director
until February 1991. Mr. Moorehead is a director of United Road Services, Inc.,
a publicly-held company. From 1977 until 1984, Mr. Moorehead served in various
management positions with Waste Management, Inc. Mr. Moorehead holds a B.S. in
Engineering Mathematics from the University of Tulsa.
Hon. Edward M. Rowell, age 67, has been a Director of the Company since the
closing of the IPO. From April 1990 to August 1994, Mr. Rowell served as the
United States Ambassador to Luxembourg. Mr. Rowell also served from January
1988 to April 1990 as the United States Ambassador to Portugal and from August
1985 to January 1988 as the Ambassador to Bolivia. Mr. Rowell is currently
President of the Association for Diplomatic Studies and Training, an
organization that promotes the quality preparation of persons who represent the
United States abroad. He is also a Senior Associate of Global Business Access,
Ltd., a private trade development firm in Washington, D.C., and an independent
lecturer on European Monetary Union. Mr. Rowell holds a B.A. in International
Relations from Yale University and was a Sloan Executive Fellow at the Stanford
University Graduate School of Business.
VOTE REQUIRED FOR APPROVAL
The nine (9) nominees receiving a plurality of the votes cast at the Annual
Meeting for the election of Directors will be elected as Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITS NOMINEES TO THE BOARD OF
DIRECTORS
COMPENSATION OF DIRECTORS
Directors who are employees of the Company do not receive additional
compensation for serving as Directors. Each Director who is not an employee of
the Company receives a fee of $1,500 for attendance at each Board of Directors'
meeting and $1,000 for attendance of the committee meetings (unless held on the
same day as a Board of Directors' meeting) and an initial grant of
non-qualified options to purchase 10,000 shares of Common Stock under the
Company's 1995 Stock Option Plan, as amended (the "Stock Option Plan").
Non-employee Directors also receive annual grants of non-qualified options to
purchase 5,000 shares of Common Stock. All Directors of the Company are
reimbursed for out-of-pocket expenses incurred in their capacity as Directors
of the Company.
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BOARD AND COMMITTEE MEETINGS
The Board of Directors met four times during 1998. All of the Directors
attended at least 75% of the aggregate of all meetings of the Board of
Directors and the committees on which they served during 1998.
The Board of Directors has an Executive Committee, an Audit Committee, a
Compensation Committee and a Nominating Committee. The members of the Executive
Committee presently consist of Mr. Walker, Mr. Bowman, Mr. Lowenstein and Mr.
Bellenghi.
The members of the Audit Committee presently consist of Mr. Bradley, Mr.
Moorehead and Mr. Rowell. The Audit Committee is generally responsible for
recommending the appointment of the Company's independent auditors and
overseeing the accounting and internal audit functions of the Company,
including reviewing, with the Company's independent auditors: (i) the general
scope of their audit services and the annual results of their audit; (ii) the
reports and recommendations made to the Audit Committee by the independent
auditors; and (iii) the Company's internal control structure. The Audit
Committee held four meetings during 1998.
The members of the Compensation Committee presently consist of Mr. Bradley,
Mr. Moorehead and Mr. Rowell. The Compensation Committee is responsible for
reviewing and making recommendations to the Board of Directors concerning
remuneration of the Company's executive officers. The Compensation Committee
also determines stock options to be granted to executive officers pursuant to
the Stock Option Plan. The Compensation Committee held four meetings during
1998.
The members of the Nominating Committee presently consist of Mr. Walker,
Mr. Shaw and Mr. Rowell. The Nominating Committee is responsible for making
recommendations to the Board of Directors concerning nominees for election to
the Board of Directors. The Nominating Committee held one meeting during 1998.
EXECUTIVE OFFICERS
The executive officers of the Company are appointed annually by the Board
of Directors of the Company and serve at the discretion of the Board. The
executive officers of the Company, other than Messrs. Barker, Byerley, Guy,
Rose and Zazworsky and Ms. Lebenberg, their respective ages and positions and
certain other information with respect to each of them are set forth herein
under the section entitled "Election of Directors."
Timothy J. Barker has been Senior Vice President and Chief Financial
Officer of the Company since November 1997. From November 1995 to November
1997, Mr. Barker held the positions of Chief Accounting Officer and Controller
of the Company. Prior to joining the Company as a full-time consultant in June
1995, Mr. Barker was a manager with Arthur Andersen LLP, where he served in
various capacities over a nine-year period. Mr. Barker served as Vice President
of Financial Planning and Analysis for Sunbelt National Mortgage Corporation
from June 1993 to October 1994. Mr. Barker holds a B.A. in Accounting from
Texas Tech University and has been a C.P.A. since 1985.
David M. Byerley has been Senior Vice President of F.Y.I. since November
1998. From August 1996 until October 1998, Mr. Byerley was Executive Vice
President of IKON's Business Information Services Division. From February 1995
until August 1996, Mr. Byerley was Senior Vice President of Product Development
and Marketing with Dataplex Corporation, a wholly-owned subsidiary of
Affiliated Computer Services. From August 1994 until February 1995, Mr. Byerley
was employed by Eastman Kodak. Mr. Byerley holds a B.S. degree from Dickinson
College and a M.S. degree from Temple University and a J.D. from Temple
University Law School.
Phillip B. Guy has been Senior Vice President of F.Y.I. since October 1998.
From April 1997 until September 1998, Mr. Guy was President and CEO of Antrium
Corporation. From February 1996 until March 1997, Mr. Guy was President and CEO
of Healthcare Communications, Inc. Prior to 1995, Mr. Guy was President and CEO
of Scientific Software/Bell South Systems Integration. Previously, Mr. Guy held
various sales, marketing and management positions at HBOC and IBM. Mr. Guy
holds a B.S. in Business Administration and Accounting from Lambuth College.
Margot T. Lebenberg has been Senior Vice President, General Counsel and
Secretary of the Company since October 1998. From May 1996 until October 1998,
Ms. Lebenberg held the positions of Vice President, General Counsel and
Secretary of the Company. From 1992 until joining the Company, Ms. Lebenberg
was an attorney with Morgan, Lewis & Bockius LLP in New York, where she
practiced law in the business and finance group primarily in the areas of
securities and mergers and acquisitions, specializing in consolidation
transactions. Ms. Lebenberg holds a B.A. in Economics and History from the
State University of New York at Binghamton and a J.D. from Fordham University
School of Law.
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Joe A. Rose has been Senior Vice President of the Company since July 1997.
From May 1995 through January 1997, Mr. Rose was President and CEO of FormMaker
Software, Inc. a document technology company which merged with Image Sciences
Corp., a publicly held company. From May 1993 through May 1995, Mr. Rose was
Corporate Vice President of John H. Harland Company, a financial services
company, and President and CEO of its subsidiary, Formation Technology, Inc.
From July 1988 through May 1993, Mr. Rose served as Executive Vice President of
National Data Corporation where he was responsible for the credit card and cash
management divisions. Mr. Rose began his information services career at EDS in
sales. In addition, Mr. Rose is a board member of Identitech Inc., a workflow
technology company. Mr. Rose holds a B.A. from Texas Tech University.
Ronald Zazworsky has been Senior Vice President of the Company since
October 1997. From February 1994 until joining the Company, Mr. Zazworsky was
Senior Vice President of Medaphis Corporation, a healthcare systems and
services company. From April 1992 to February 1994, Mr. Zazworsky was President
and CEO of Habersham Banking Solutions, Inc. Prior to 1992, Mr. Zazworsky was
employed at HBOC. as Regional Vice President for eight years. Previously, Mr.
Zazworsky held various sales, marketing and management positions at IBM. Mr.
Zazworsky holds a B.A. from Gettysburg College and an M.B.A. from Emory
University.
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee, subject to the employment agreements described
below, reviews and recommends to the Board of Directors for its approval the
salaries and bonuses of the Company's officers, including its nine executive
officers - Thomas C. Walker, Chairman of the Board and Chief Development
Officer; Ed H. Bowman, Jr., President and Chief Executive Officer; David
Lowenstein, Executive Vice President - Corporate Development and Acquisitions
and Treasurer; Timothy J. Barker, Senior Vice President and Chief Financial
Officer; David M. Byerley, Senior Vice President - Corporate Development;
Phillip B. Guy, Senior Vice President; Margot T. Lebenberg, Senior Vice
President, General Counsel and Secretary; Joe A. Rose, Senior Vice President;
and Ronald Zazworsky, Senior Vice President. In addition, the Compensation
Committee grants stock options under the Stock Option Plan to selected
Directors, executive officers and other key employees.
Compensation Philosophy
The Company's executive compensation program is designed to integrate
compensation with the achievement of the Company's short and long-term business
objectives and to assist the Company in attracting, motivating and retaining
the highest quality executives.
Executive compensation is comprised of three components: (i) a base salary,
which attracts talented employees and contributes to motivating and rewarding
individual performance; (ii) an incentive bonus of cash, stock, options or
warrants, which integrates financial reward to the achievement of the Company's
short- term performance objectives; and (iii) a stock option program, which is
intended to promote the achievement of long-term performance goals and to align
the long-term interests of the Company's executive officers with those of the
stockholders.
The base salary and incentive bonus payable to each of the Company's
executive officers are presently governed by employment agreements entered into
by the Company with each of such executive officers. See "Employment Contracts,
Termination of Employment and Change-in-Control Arrangements." The Compensation
Committee conducts ongoing reviews of such employment agreements to ensure that
they are consistent with the Compensation Committee's then current philosophy.
The Committee generally intends that compensation paid to the Company's
Chief Executive Officer and the other executive officers named in the Summary
Compensation Table not be subject to the limitation on tax deductibility under
Section 162(m) of the Internal Revenue Code, as amended (the "Code"), so long
as this can be achieved in a manner consistent with the Committee's other
objectives. Section 162(m) generally eliminates a corporation's tax deduction
in a given year for payments to certain named executive officers in excess of
$1 million, unless such payments result from "qualified performance-based
compensation." The Committee has been advised that compensation paid in 1998
should not be subject to the limitation on deductibility under Code Section
162(m).
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Base Salary Compensation
The Compensation Committee continues to believe that the retention of
executives who have developed the skills and expertise required to lead the
organization is vital to the Company's competitive strength. It further
believes that attracting other key employees who can supplement the efforts of
its existing executives is absolutely critical. To this end, it is the
Compensation Committee's policy to continue to establish base pay at a
competitive level.
Incentive Bonus Compensation
The Compensation Committee believes that compensation should vary with
corporate performance and that a significant portion of compensation should
continue to be linked to the achievement of business goals. Under the Company's
employment agreements with its executive officers, the incentive bonus award
component of their compensation is based on the achievement of certain levels
of operating profitability, and awards are payable only if current year's
operating profits meet certain projected results. Such incentive bonus award
component is subject to annual review by the Compensation Committee.
Pursuant to the 1999 incentive bonus plan (the "1999 Incentive Bonus
Plan"), the executive officers were granted options to purchase Common Stock of
the Company, which will vest upon the Company achieving certain earnings
targets for 1999, in lieu of cash bonuses.
Stock Option Grants
It is the policy of the Compensation Committee to award stock options to
executive officers and other key employees of the Company to align their
interests with those of the Company's long-term investors and to help attract
and retain such persons. The options, therefore, provide value to the
recipients only if and when the market price of the Common Stock increases
above the option grant price. To that end, there is ongoing review by the
Committee of the market price of Common Stock and the grant price of options.
It is the Committee's goal to preserve this incentive as an effective tool in
motivating and retaining executives.
Options to purchase approximately 740,000 shares of Common Stock were
granted during 1998 to certain employees who were hired during 1998 and to the
executive officers, other current management level employees and select key
employees and consultants. The Compensation Committee believes that granting
such options, including in particular with respect to the executive officers,
not only provides a meaningful long-term incentive to those individuals who
have been identified as key to the future success of the Company and to help
retain the services of such personnel, but also further links compensation to
the overall performance of the Company.
Compensation of the Chief Executive Officer
The Compensation Committee considers several factors in establishing the
Chief Executive Officer's compensation package, including market pay practices,
performance level, contributions toward achievement of strategic goals and the
overall financial and operating success of the Company. Compensation paid
during 1998 to Mr. Bowman was composed of the base salary set forth in Mr.
Bowman's amended employment agreement and options granted pursuant to his
employment agreement. See "Employment Contracts, Termination of Employment and
Change-in-Control Arrangements."
Mr. Bowman's employment agreement, as amended, provides for options to
purchase 80,000 shares of Common Stock issued in November 1995 which vest in
20% increments beginning on May 1996 and warrants to purchase 100,000 shares of
Common Stock issued in November 1995 which vested 50% in March 1997 and 50% in
January 1998. In addition, his agreement provides for additional option or
warrant grants to be made at such time as the market price of the Company's
Common Stock reaches certain specified levels. Pursuant to this provision, the
following options and warrants have been issued: (i) warrants to purchase
50,000 shares of Common Stock were issued in May 1996 which vested 50% in May
1997 and 50% in May 1998; (ii) options to purchase 50,000 shares of Common
Stock were issued in September 1997 which vested 50% in September 1998 and will
vest as to 50% in September 1999; and (iii) options to purchase 50,000 shares
of Common Stock were issued in March 1998 which vested 50% in March 1999 and
will vest as to 50% in March 2000. In addition to the above, in April 1997, Mr.
Bowman was issued options to purchase 25,000 shares of Common Stock, which are
fully exercisable. In December 1997, Mr. Bowman was issued options to purchase
35,000 shares of Common Stock, in lieu of a cash bonus, which were fully vested
on March 31, 1998; options to purchase 25,000 shares of Common Stock, which vest
annually in 20% increments beginning in June 1998; and options to purchase
60,000 shares of Common Stock, in lieu of a cash bonus, which fully vested upon
the Company achieving certain earnings targets for 1998. In September 1998, Mr.
Bowman was issued options to purchase 40,000 shares of Common Stock which vested
in 33% increments beginning September 1998; and options to purchase 62,500
shares of Common Stock, in lieu of a cash bonus, which fully vest upon the
Company achieving certain earning targets for 1999.
THE COMPENSATION COMMITTEE
Michael J. Bradley
Donald F. Moorehead, Jr.
Hon. Edward M. Rowell
10
<PAGE> 11
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning the annual and
long-term compensation earned during the last three fiscal years by the
Company's Chief Executive Officer and each of the other four most highly
compensated executive officers of the Company (collectively, the "named
executive officers").
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
----------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
---------------------------------------- ------ -------
SECURITIES LTIP
OTHER ANNUAL UNDERLYING PAYOUTS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($)(7) COMPENSATION($) OPTIONS/SARS(#)(4) $ COMPENSATION($)
- --------------------------- ---- -------- ---------- --------------- ------------------ ------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ed H. Bowman, Jr 1996 200,000 -- 76,060(1) 130,000 -- --
President and Chief 1997 250,000 107,417 60,538(2) 195,000 -- --
Executive Officer 1998 300,000 -- -- 152,500 -- --
Thomas C. Walker 1996 150,000 -- -- -- -- --
Chairman of the Board 1997 150,000 -- -- 67,500 -- --
and Chief Development Officer 1998 225,000 -- -- 42,083 -- --
David Lowenstein 1996 120,000 -- -- -- -- --
Executive Vice President - 1997 120,000 -- -- 62,000 -- --
Corporate Development and 1998 200,000 -- 38,000 -- --
Acquisitions and Treasurer
Joe A. Rose(5) 1996 -- -- -- -- -- --
Senior Vice President 1997 80,471 54,000 21,114(3) 81,500 -- --
1998 165,000 15,000 -- 32,750 -- --
Ronald Zazworsky(6) 1996 -- -- -- -- -- --
Senior Vice President 1997 26,000 -- -- 65,000 -- --
1998 156,667 20,000 -- 27,833 -- --
</TABLE>
- ---------
(1) Includes $70,560 in moving related expenses and $5,500 in automobile
related expenses.
(2) Includes $48,605 of reimbursement of additional federal income taxes
incurred by Mr. Bowman due to his receipt of certain payments in respect
to his relocation in 1996, $6,000 in automobile related expenses and
$5,933 in insurance premiums paid by the Company on behalf of Mr. Bowman.
(3) Includes $17,810 in moving related expenses and $3,304 in automobile and
insurance related expenses.
(4) Represents options or warrants granted to purchase the stated number of
shares of Common Stock.
(5) Mr. Rose commenced employment with the Company in July 1997.
(6) Mr. Zazworsky commenced employment with the Company in October 1997.
(7) In addition, in 1997 and 1998 options were issued in lieu of cash bonuses.
11
<PAGE> 12
STOCK OPTION GRANTS IN LAST FISCAL YEAR
The following table contains information concerning the grants of stock
options to the named executive officers during fiscal 1998.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
------------------------------------------------- VALUE AT ASSUMED
PERCENT OF ANNUAL RATES OF
NUMBER OF TOTAL EXERCISE STOCK PRICE
SECURITIES OPTIONS OR APPRECIATION FOR
UNDERLYING GRANTED TO BASE OPTION TERM(4)
OPTIONS EMPLOYEES PRICE EXPIRATION -----------------------
NAME GRANTED(#) IN 1998(%) ($/SH) DATE 5%($) 10%($)
- ------------------------- ---------- ---------- -------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Ed H. Bowman, Jr. 50,000(1) 6.7 35.00 03/05/08 1,100,566 2,789,049
President and Chief 40,000(2) 5.4 23.50 09/14/08 591,161 1,498,118
Executive Officer 62,500(3) 8.4 23.50 09/14/08 923,689 2,340,809
Thomas C. Walker 20,000(2) 2.7 23.50 09/14/08 295,580 749,059
Chairman of the Board 22,083(3) 3.0 23.50 09/14/08 326,365 827,073
And Chief Development
Officer
David Lowenstein 18,000(2) 2.4 23.50 09/14/08 266,022 674,153
Executive Vice President 20,000(3) 2.7 23.50 09/14/08 295,580 749,059
- - Corporate Development
and Acquisitions and
Treasurer
Joe A. Rose 14,000(2) 1.9 23.50 09/14/08 206,906 524,341
Senior Vice President 18,750(3) 2.5 23.50 09/14/08 277,107 702,243
Ronald Zazworsky 12,000(2) 1.6 23.50 09/14/08 177,348 449,435
Senior Vice President 15,833(3) 2.1 23.50 09/14/08 233,996 592,993
</TABLE>
- --------
(1) These non-qualified stock options were granted under the Company's Stock
Option Plan and entitle the holder to purchase shares of the Common Stock
at an exercise price equal to the fair market value per share of the Common
Stock as of the date the option was granted. These options are exercisable
as to 50% of the underlying shares on March 5, 1999 and are exercisable as
to the remaining 50% of the underlying shares on March 5, 2000.
(2) These non-qualified stock options were granted under the Company's Stock
Option Plan and entitle the holder to purchase shares of the Common Stock
at an exercise price equal to the fair market value per share of the Common
Stock as of the date the option was granted. One-third of these options
vested immediately on the date of the option grant. The remaining options
are exercisable in equal increments on September 14, 1999 and September 14,
2000.
(3)These non-qualified stock options were granted under the Company's Stock
Option Plan and entitle the holder to purchase shares of the Common Stock
at an exercise price equal to the fair market value per share of the Common
Stock as of the date the option was granted. These options vest in 2007;
however, this vesting may be accelerated upon achieving certain earnings
targets in 1999.
(4) The potential realizable values are the results of calculations at assumed
annual rates of stock price appreciation of five percent and ten percent.
These assumed rates of growth were selected by the Securities and Exchange
Commission for illustration purposes only. They are not intended to
forecast possible future appreciation, if any, of the Company's stock
price. No gain to optionees is possible without an increase in stock
prices, which will benefit all stockholders. Options become immediately
exercisable in the event of a change-in-control as defined in the Stock
Option Plan.
12
<PAGE> 13
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR END OPTION VALUES
The following table provides information, with respect to the named
executive officers, concerning options exercised during fiscal 1998 and the
options and warrants held as of December 31, 1998.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED IN-THE-
OPTIONS AND WARRANTS AT MONEY OPTIONS AND WARRANTS
FISCAL YEAR END(#) AT FISCAL YEAR END(1)($)
SHARES ACQUIRED VALUE ----------------------------- -----------------------------
NAME ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------ --------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Ed H. Bowman, Jr.......... - - 322,333 255,167 5,084,333 2,005,667(2)
President and Chief
Executive Officer
Thomas C. Walker.......... 15,000 180,938 27,667 66,916 271,917 623,914
Chairman of the Board and
Chief Development Officer
David Lowenstein.......... - - 39,000 61,000 426,750 569,250
Executive Vice President
Corporate Development and
Treasurer
Joe A. Rose............... 2,500 23,800 28,167 83,583 283,362 812,263
Senior Vice President
Ronald Zazworsky.......... - - 24,000 68,833 199,000 603,831
Senior Vice President
</TABLE>
- ---------
(1) The value of an unexercised option or warrant at December 31, 1998 is
determined by subtracting the exercise price of such option or warrant
from the last sale price of a share of Common Stock on December 31, 1998
($32.00), as reported by The Nasdaq Stock Market.
(2) Excludes the value of 50,000 unexercisable options which were not
in-the-money at December 31, 1998.
13
<PAGE> 14
PERFORMANCE GRAPH
The graph below compares, on a dividend reinvestment basis, the cumulative
total return of the Company with two selected peer groups of document and
information management services companies and the S&P 500 Composite Stock Price
Index for the period from January 23, 1996 (the effective date of the Company's
IPO) through December 31, 1998 assuming $100 was invested on January 23, 1996
in each case. The first selected peer group of document management services
companies consists of Iron Mountain, Inc., Lason, Inc., Pierce Leahy, Inc.,
Vestcom, Inc. and ImageMax, Inc. The second peer group of document management
services companies consists of Lason, Inc., Vestcom, Inc., ImageMax, Inc. and
IKON Office Solutions, Inc. These companies were selected based on SIC code or
are considered by the Company's management to be competitors of the Company.
The returns of each peer group company have been weighted according to its
stock market capitalization for purposes of arriving at a peer group average.
The performance of the Company's Common Stock reflected below is not
necessarily indicative of future performance.
<TABLE>
<CAPTION>
MEASUREMENT PERIOD F.Y.I.
(FISCAL YEAR COVERED) INCORPORATED S & P 500 PEER GROUP #1 PEER GROUP #2
<S> <C> <C> <C> <C>
1995 100.0 100.0 100.0 100.0
1996 160.6 123.0 150.6 117.5
1997 176.9 164.0 178.5 86.7
1998 246.2 210.7 308.3 142.2
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
In 1998, the Compensation Committee consisted of Mr. Bradley, Mr. Moorehead
and Mr. Rowell. All of the members of the Compensation Committee are
non-employee Directors of the Company and are not former officers of the
Company. During 1998, no executive officer of the Company served as a member of
the Board of Directors or on the compensation committee of a corporation where
any of its executives officers served on the Compensation Committee or on the
Board of Directors of the Company.
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
Messrs. Walker, Bowman and Lowenstein entered into amended and restated
employment agreements with the Company in January 1999. Messrs. Walker's and
Lowenstein's employment agreements are for two-year terms and Mr. Bowman's
employment agreement is for a term of five years. Mr. Barker and Ms. Lebenberg
entered into employment agreements with the Company in July 1996. Mr. Barker's
employment agreement is for a term of two and one-half years and Ms.
Lebenberg's employment agreement is for a term of three years. All of the above
agreements have automatic one-year renewals unless terminated by the Company or
the employee according to the terms of the agreements. Mr. Rose entered into an
employment agreement with the Company in June 1997, which agreement was amended
in June 1998 to provide for a two-year term beginning in June 1997. Mr. Byerley
entered into a two-year employment agreement with the Company in November 1998.
Each of Messrs. Guy and Zazworsky entered into an employment agreement with the
Company in October 1998, each of which employment agreement terminates on
December 31, 2000. Pursuant to the employment agreements, each employee named
above receives an annual base salary and is eligible for additional year-end
bonus compensation.
Each of the employment agreements provides that, in the event of a
termination of employment by the Company without cause or by the employee for
good reason, such employee shall be entitled to receive from the Company a lump
sum payment equal to such employee's then current salary for the greater of two
years or the remainder under the employment agreement in the case of Messrs.
Bowman, Walker and Lowenstein and Ms. Lebenberg; one year's salary in the case
of Mr. Barker; and the greater of the period remaining under the agreement or
six months, in the case of Messrs. Byerley, Guy, Rose and Zazworsky. In the
event of a change in control of the Company, if Messrs. Guy and Zazworsky have
received notice prior to the event resulting in such change of control that
their employment will not be continued by the successor to the Company, they
shall receive a lump-sum payment equal to one and one-half times their then
current salary. For the other executive officers, in the event of a change in
control of the Company, if the employee has not received notice 15 days prior to
the event resulting in such change of control that such employee's employment
will be continued by the successor to the Company the amount of the lump-sum
payment to be made to such employee shall be ten times in the case of Mr.
Bowman; six times in the case of Messrs. Walker and Lowenstein; three times in
the case of Ms. Lebenberg; one and one-half times in the case of Mr. Barker; and
one year's salary in the cases of Messrs. Byerley, Guy, Rose and Zazworsky. In
addition, in the event of a change in control of the Company with notice, the
amount of the lump-sum payment to be made to such employee shall be 150% of the
amount ordinarily due upon a termination without cause in the case of Mr. Barker
and Ms. Lebenberg; six times their annual salary in the case of Messrs. Walker
and Lowenstein; ten times his annual salary in the case of Mr. Bowman; and one
year's salary in the case of Messrs. Byerley, Guy, Rose and Mr. Zazworsky.
Each of Messrs. Bowman's, Lowenstein's, Walker's and Barker's and Ms.
Lebenberg's employment agreements contains a covenant not to compete with the
Company for a period of two years following termination of employment, provided
that: (i) in the event of a termination of employment by the Company without
cause, the term of the covenant not to compete contained in the employment
agreement will be shortened to one year; and (ii) in the event of termination
of employment by the employee for good reason or in the event of a change in
control of the Company wherein the employee does not receive notice 15 days
prior to the event resulting in such change of control of the continuation of
such employee's employment, the covenant-not-to-compete shall not apply. Each
of Messrs. Guy's, Rose's and Zazworsky's employment agreements contains a
covenant not to compete with the Company for a period of three years following
termination of employment. In the case of Mr. Rose, in an event of a change in
control of the Company wherein the employee does not receive notice 15 days
prior to the event resulting in such change of control of the continuation of
such employee's employment, the covenant-not-to-compete shall not apply. Mr.
Byerley's employment agreement contains a covenant not to compete with the
Company for a period of two years (one year if the employment is terminated by
the Company without cause or by Mr. Byerley for good reason) following
termination of employment, provided that in an event of a change in control of
the Company wherein the employee does not receive notice 15 days prior to the
event resulting in such change of control of the continuation of such
employee's employment, the covenant-not-to-compete shall not apply. If
applicable law reduces the time period during which any employee is prohibited
from competing with the Company, the covenant not to compete shall be reduced
to the maximum period permitted by law.
14
<PAGE> 15
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS,
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information, as of March 15, 1999,
regarding the beneficial ownership of the Common Stock by (i) each person known
to the Company to beneficially own more than 5% of the Common Stock; (ii) each
Director and each named executive officer; and (iii) all Directors and named
executive officers as a group. Unless otherwise indicated, the address of each
person listed below is c/o F.Y.I. Incorporated, 3232 McKinney Avenue, Suite
900, Dallas, Texas 75204. All persons listed have sole voting and investment
power with respect to their shares unless otherwise indicated. At March 15,
1999, there were 14,103,129 shares of the Common Stock outstanding (including
36,670 shares held by a wholly-owned subsidiary of the Company).
NAME OF BENEFICIAL OWNER
<TABLE>
<CAPTION>
PERCENT OF
OUTSTANDING
SHARES COMMON
GREATER THAN 5% STOCKHOLDERS: OWNED COMMON STOCK
- -------------------------------------------------- --------- ------------
<S> <C> <C>
Dresdner RCM Global Investors LLC................. 1,238,706 8.8
Dresdner RCM Global Investors US Holdings LLC
Four Embarcadero Center
San Francisco, California 94111
Dresdner Bank AG.................................. 1,245,706 8.8
Four Embarcadero Center
San Francisco, California 94111
DIRECTORS AND NAMED EXECUTIVE OFFICERS:
Ed H. Bowman, Jr.(1).............................. 417,333 3.0
Thomas C. Walker(2)............................... 310,167 2.2
Gregory R. Melanson(3)............................ 282,260 2.0
David Lowenstein(4)............................... 271,000 1.9
Kyle C. Kerbawy................................... 230,000 1.6
Jonathan B. Shaw.................................. 155,198 1.1
Donald F. Moorehead, Jr.(5)....................... 100,284 *
Michael J. Bradley(5)............................. 50,800 *
G. Michael Bellenghi.............................. 45,800 *
Joe A. Rose(6).................................... 36,417 *
Ronald Zazworsky(7)............................... 31,500 *
Hon. Edward M. Rowell(5).......................... 20,000 *
All Directors and named executive officers as a
group (12 persons)(8)........................... 1,950,759 13.8
</TABLE>
- ---------
* Represents less than 1%.
15
<PAGE> 16
(1) Does not include 170,167 shares which may be acquired upon the exercise of
options and warrants not exercisable within 60 days.
(2) Does not include 44,416 shares which may be acquired upon the exercise of
options not exercisable within 60 days.
(3) Does not include 7,500 shares which may be acquired upon the exercise of
options not exercisable within 60 days.
(4) Does not include 41,000 shares which may be acquired upon the exercise of
options not exercisable within 60 days.
(5) Does not include 5,000 shares which may be acquired upon the exercise of
options not exercisable within 60 days.
(6) Does not include 75,333 shares which may be acquired upon the exercise of
options not exercisable within 60 days.
(7) Does not include 61,333 shares which may be acquired upon the exercise of
options not exercisable within 60 days.
(8) Does not include 414,749 shares which may be acquired upon the exercise of
options and warrants not exercisable within 60 days.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
REAL ESTATE TRANSACTIONS
Researchers leased office facilities and certain equipment from Mr.
Melanson. The total lease payments to Mr. Melanson were approximately $342,000
for the year ended December 31, 1998. Researchers is also required to pay the
taxes and insurance on the properties. The Company believes that the amounts
paid for such properties do not exceed the fair market rental thereof. The
Company and Mr. Melanson have entered into an agreement terminating such leases
for 1999.
COMPANY POLICY
It is the Company's policy that transactions with affiliates of the Company
will be approved by a majority of the disinterested members of the Board of
Directors, and will be made on terms no less favorable to the Company than
could be obtained from unaffiliated third parties.
INDEPENDENT ACCOUNTANTS
Upon the recommendation of the Audit Committee, the Board of Directors
selected Arthur Andersen LLP as its independent public accountants for fiscal
1999. Arthur Andersen LLP audited the Company's books, records and accounts for
fiscal 1998, and representatives of the firm will attend the Annual Meeting,
will have the opportunity to make a statement and will be available to answer
questions that may be asked by stockholders.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's officers and directors and persons who own more than 10% of a
registered class of the Company's equity securities to file initial reports of
ownership and reports of changes in ownership with the Securities and Exchange
Commission (the "SEC"). Such persons are required by SEC regulation to furnish
the Company with copies of all Sections 16(a) forms they file.
Based solely on its review of the copies of such forms received by it with
respect to fiscal 1998, or written representations from certain reporting
persons, to the best of the Company's knowledge, all reports were filed on a
timely basis.
OTHER MATTERS
The Board of Directors does not know of any matters to be presented for
consideration at the Annual Meeting other than the matters described in the
Notice of Annual Meeting, but if other matters are presented, it is the
intention of the persons named in the accompanying Proxy to vote on such
matters in accordance with their judgment.
16
<PAGE> 17
STOCKHOLDER PROPOSALS FOR THE 2000
ANNUAL MEETING OF STOCKHOLDERS
Stockholder proposals to be presented at the 2000 Annual Meeting of
Stockholders must be received, in writing, by the Secretary of the Company at
the Company's principal executive offices no later than November 22, 1999 in
order to be included in the Company's Proxy materials relating to that meeting.
REPORT ON FORM 10-K
THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER
31, 1998, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, IS AVAILABLE TO
STOCKHOLDERS, WITHOUT CHARGE, UPON WRITTEN REQUEST. EXHIBITS TO THE FORM 10-K
WILL BE FURNISHED UPON PAYMENT OF $.50 PER PAGE, WITH A MINIMUM CHARGE OF
$5.00. REQUESTS FOR COPIES SHOULD BE DIRECTED TO F.Y.I. INCORPORATED, 3232
MCKINNEY AVENUE, SUITE 900, DALLAS, TEXAS 75204, ATTENTION: INVESTOR RELATIONS.
By Order of the Board of Directors
/s/ MARGOT T. LEBENBERG
Margot T. Lebenberg
Senior Vice President,
General Counsel and Secretary
Dallas, Texas
March 26, 1999
17
<PAGE> 18
F.Y.I. INCORPORATED
ANNUAL MEETING OF STOCKHOLDERS - MAY 12, 1999
The undersigned hereby appoints Thomas C. Walker and Ed H. Bowman, Jr., and
each of them, proxies, with full power of substitution, to appear on behalf of
the undersigned and to vote all shares of Common Stock (par value $.01) of
F.Y.I. Incorporated (the "Company") which the undersigned is entitled to vote
at the Annual Meeting of Stockholders to be held at the Melrose Hotel, 3015 Oak
Lawn Avenue, Dallas, Texas 75219 on Wednesday, May 12, 1999, commencing at
10:00 a.m. (local time), and at any adjournment thereof.
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO
INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE
LISTED NOMINEES AS DIRECTORS.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE> 19
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF STOCKHOLDERS
F.Y.I. INCORPORATED
MAY 12, 1999
PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED
- -------------------------------------------------------------------------------
[X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
FOR all WITHHOLD
nominees listed at right AUTHORITY
(except as marked to for all nominees
1. Election of the contrary below) listed at right
Directors [ ] [ ]
NOMINEES: THOMAS C. WALKER
ED H. BOWMAN, JR.
DAVID LOWENSTEIN
G. MICHAEL BELLENGHI
GREGORY R. MELANSON
JONATHAN B. SHAW
MICHAEL J. BRADLEY
DONALD F. MOOREHEAD, JR.
EDWARD M. ROWELL
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting and any adjournment
thereof.
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark
the "For" box and write that nominee's name in the space provided below.)
- -------------------------------
PLEASE SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
PLEASE CHECK HERE IF YOU PLAN TO ATTEND THE ANNUAL MEETING [ ]
Signature_________________Signature__________________Dated:_____________, 1999
Note: Please sign exactly as YOUR name appears above. When signing as an
attorney, executor, administrator, trustee or guardian, please give your
full title. If shares are held jointly, each holder should sign.
- -------------------------------------------------------------------------------
