<PAGE> 1
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 Rule 14a-11(c) or Rule 14a-12
Advanta Corp.
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
(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 on 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:
___________________________________________________________________________
(4) Date Filed:
___________________________________________________________________________
<PAGE> 2
[ADVANTA LOGO]
WELSH AND MCKEAN ROADS
P.O. BOX 844
SPRING HOUSE, PENNSYLVANIA 19477-0844
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
JUNE 4, 1998
------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Advanta
Corp. (the "Company") will be held at the Company's headquarters, Welsh and
McKean Roads, Spring House, Pennsylvania, on June 4, 1998 at 1:00 p.m. (the
"Meeting") for the following purposes:
1. To elect five directors to hold office until the expiration of
their term of office and until their successors are duly elected and
qualified.
2. To transact such other business as may properly come before the
Meeting or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on Wednesday, April
15, 1998 as the record date for the Meeting. Only holders of record of the
Company's Class A Common Stock and Class A Preferred Stock at that time are
entitled to notice of, and to vote at, the Meeting and any adjournment or
postponement thereof.
The enclosed proxy is solicited by the Board of Directors of the Company.
Reference is made to the attached proxy statement for further information with
respect to the business to be transacted at the Meeting. The Board of Directors
urges you to date, sign and return the enclosed proxy promptly. A reply envelope
is enclosed for your convenience. You are cordially invited to attend the
Meeting in person. The return of the enclosed proxy will not affect your right
to vote if you attend the Meeting in person.
ELIZABETH H. MAI
Secretary
Dated: May 1, 1998
<PAGE> 3
[ADVANTA LOGO]
WELSH AND MCKEAN ROADS
P.O. BOX 844
SPRING HOUSE, PENNSYLVANIA 19477-0844
------------------------
PROXY STATEMENT
------------------------
ANNUAL MEETING OF STOCKHOLDERS TO
BE HELD ON THURSDAY, JUNE 4, 1998
------------------------
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Advanta Corp. (the "Company") to be used at
the Annual Meeting of Stockholders, and any adjournment or postponement thereof
(the "Meeting"), to be held on the date, at the time and place, and for the
purposes set forth in the foregoing notice. This proxy statement, the foregoing
notice and the enclosed proxy are first being mailed to holders of the Company's
Class A Common Stock and Class A Preferred Stock on or about May 1, 1998.
The Board of Directors does not intend to bring any matter before the
Meeting except as specifically indicated in the notice, nor does the Board of
Directors know of any matters which anyone else proposes to present for action
at the Meeting. If any other matters properly come before the Meeting, however,
the persons named in the enclosed proxy, or their duly constituted substitutes
acting at the Meeting, will be authorized to vote or otherwise act thereon in
accordance with their judgment on such matters.
Shares represented by proxies received by the Company, where the
stockholder has specified a choice with respect to the election of directors
will be voted in accordance with the specification(s) so made. In the absence of
such specification(s), the shares will be voted "For" the election of all five
nominees for the Board of Directors.
Any proxy may be revoked at any time prior to its exercise by notifying the
Secretary of the Company in writing, by delivering a duly executed proxy bearing
a later date or by attending the Meeting and voting in person.
The accompanying form of proxy is being solicited on behalf of the Board of
Directors of the Company. The expenses of solicitation of proxies for the
Meeting will be paid by the Company. In addition to the mailing of the proxy
material, such solicitation may be made in person or by telephone by directors,
officers and employees of the Company, who will receive no additional
compensation therefor. In addition, the Company has retained D.F. King & Co.
Inc. to assist in the search for, and distribution of proxies to, beneficial
owners of the Company's Class A Common Stock held in street name or by other
nominees, and will pay such firm a fee of $2,000, plus reimbursement of direct
out-of-pocket expenses incurred by such firm in such activity. Upon request, the
Company will reimburse brokers, dealers, banks and trustees, or their nominees,
for reasonable expenses incurred by them in forwarding material to beneficial
owners of shares of Class A Common Stock of the Company. Beneficial owners of
shares of Class B Common Stock, which will not be voting at the Meeting, also
will receive all proxy material (other than the proxy card itself), together
with the Company's Annual Report for the fiscal year ended December 31, 1997.
The expenses of such additional mailing will be borne by the Company.
1
<PAGE> 4
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
OUTSTANDING SHARES AND VOTING RIGHTS
Only holders of record of the Company's Class A Common Stock and Class A
Preferred Stock at the close of business on April 15, 1998 are entitled to
notice of, and to vote at, the Meeting. On that date the Company had outstanding
10,375,494 shares of Class A Common Stock, par value $.01 per share, and 1,010
shares of Class A Preferred Stock, par value $1,000 per share. On all matters
voted upon at the Meeting and any adjournment or postponement thereof, the
holders of the Class A Common Stock and the Class A Preferred Stock vote
together as a single class, with each record holder of Class A Common Stock
entitled to one vote per share, and each record holder of Class A Preferred
Stock entitled to one-half vote per share.
The presence, in person or by proxy, of stockholders entitled to cast a
majority of the votes which all stockholders are entitled to cast will
constitute a quorum for the conduct of business at the Meeting. With regard to
the election of directors, votes may be cast in favor of or withheld from each
nominee. Under applicable Delaware law, votes that are withheld and broker
non-votes will be excluded entirely from the vote and will not affect the
outcome of the election of directors, as directors are elected by a plurality of
votes cast. In the election of directors, stockholders do not have cumulative
voting rights.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The information set forth in the following table is furnished as of April
1, 1998 (unless otherwise specified), with respect to any person (including any
"group" as that term is used in Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act")) who is known to the Company to be the
beneficial owner of more than 5% of any class of the Company's voting
securities.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF
TITLE OF CLASS NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP CLASS
- -------------- ------------------------------------------ ---------- ----------
<S> <C> <C> <C>
Class A Gisella Alter(1).......................... 1,010 100.00%
Preferred
Class A Dennis Alter(1)........................... 3,046,067(2)(3)(4) 29.36%
Common
Neuberger & Berman, LLC(5)................ 985,142 9.5%
</TABLE>
- ---------------
(1) The address for Gisella Alter and Dennis Alter is c/o Advanta Corp., Welsh
and McKean Roads, P.O. Box 844, Spring House, Pennsylvania, 19477-0844.
(2) Includes 551,695 shares owned by a trust, the beneficiary of which is Linda
Alter, the sister of Dennis Alter, and pursuant to which Dennis Alter is
sole trustee. Mr. Alter disclaims beneficial ownership of these shares.
(3) Ownership includes 82,798 held by a charitable foundation established by Mr.
Alter, as to which Mr. Alter shares voting and investment powers, and 41,399
shares held by a trust established by Mr. Alter, through which he has made
certain charitable gifts of shares and as to which Mr. Alter has sole voting
and investment powers. Also includes 437,100 shares held by a charitable
foundation established by Mr. Alter, as to which Mr. Alter and his wife
share voting and investment powers. Mr. Alter disclaims beneficial ownership
of all such shares.
(4) Does not include 1,010 shares owned by Gisella Alter, the wife of Dennis
Alter.
(5) Information as to shares held by Neuberger & Berman, LLC, a registered
investment advisor ("Neuberger"), is as of April 24, 1998, after the
completion of the Tender Offer (as defined herein) and was disclosed by a
representative of Neuberger in a telephone conversation with a
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<PAGE> 5
representative of the Company on April 28, 1998. Neuberger filed a Schedule
13G with the Securities and Exchange Commission ("SEC") reflecting
information as of February 4, 1998 prior to the completion of the Tender
Offer. Under applicable SEC rules, Neuberger is deemed to be the beneficial
owner of the above-reported shares because it shares the power to vote or
direct the vote of and/or shares the power to exercise investment discretion
(dispositive power) with respect to these shares. Of these shares, 933,694,
or 8.99% of the class, are beneficially owned by Neuberger & Berman Focus
Portfolio ("Neuberger Portfolio"). Neuberger and Neuberger & Berman
Management, Inc. ("Neuberger Management") are deemed to be beneficial owners
of the shares beneficially owned by Neuberger Portfolio because Neuberger
and Neuberger Management serve as subadviser and investment manager,
respectively, of Neuberger Portfolio and thus share power to make decisions
regarding whether to retain or dispose of the shares held by Neuberger
Portfolio. The address of Neuberger, Neuberger Portfolio and Neuberger
Management is 605 Third Avenue, New York, NY 10158-3698.
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<PAGE> 6
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth certain information regarding the Class A
Common Stock and Class B Common Stock as of April 1, 1998 (unless otherwise
specified) beneficially owned by: (i) each director and nominee for director of
the Company; (ii) each person who served as the Company's Chief Executive
Officer and each of the Company's four other most highly compensated executive
officers whose compensation exceeded $100,000 during 1997 and one additional
individual who would have been included among the four referred to above had he
served as an executive officer at December 31, 1997 (the "Named Executive
Officers"); and (iii) all directors and officers as a group. Shares issuable
pursuant to the exercise of stock options are included in the table below if
such options are currently exercisable or will become exercisable by May 31,
1998. None of the Company's executive officers or directors beneficially owns
any shares of the Class A Preferred Stock or the 6 3/4% Convertible Class B
Preferred Stock, Series 1995 (Stock Appreciation Income Linked Securities
(SAILS)) ("Class B Preferred Stock (SAILS)").
<TABLE>
<CAPTION>
CLASS A COMMON CLASS B COMMON
------------------------------ ------------------------------
AMOUNT AND NATURE AMOUNT AND NATURE
OF BENEFICIAL PERCENT OF OF BENEFICIAL PERCENT OF
NAME OWNERSHIP CLASS OWNERSHIP CLASS
- -------------------------------- ----------------- ---------- ----------------- ----------
<S> <C> <C> <C> <C>
EXECUTIVE OFFICERS/DIRECTORS
Dennis Alter(1)(2)(3)........... 3,046,067 29.36% 1,315,611 8.83%
William A. Rosoff(4)............ 0 * 167,411 1.12%
Olaf Olafsson................... 0 * 200,000 1.34%
OFFICERS
Alex W. Hart(5)................. 0 ** 571,664 **
James J. Allhusen(6)............ 0 ** 90,897 **
Charles H. Podowski(7).......... 0 * 36,178 *
Milton Riseman(8)............... 0 * 101,725 *
David D. Wesselink(9)........... 0 ** 73,491 **
DIRECTORS
Arthur P. Bellis(10)............ 33,384 * 71,769 *
Max Botel (11).................. 3,609 * 30,295 *
William C. Dunkelberg(12)....... 2,478 * 29,076 *
Dana Becker Dunn(13)............ 0 * 15,038 *
Robert C. Hall(14).............. 0 * 14,736 *
James E. Ksansnak(15)........... 0 * 8,126 *
Ronald Lubner(16)............... 0 * 8,979 *
All officers and directors
as a group (14
persons)(1)(2)(3)(17)......... 3,087,869 29.75% 2,056,189 13.52%
</TABLE>
- ---------------
* Represents less than 1% of the indicated class of the Company's Common
Stock outstanding as of April 1, 1998.
** Percentages are not calculated for this person as he is no longer serving
as a director or officer of the Company and no information with respect to
ownership is available at April 1, 1998, the date for which shares
outstanding is presented.
(1) Ownership includes 551,695 shares of Class A Common Stock owned by a trust,
the beneficiary of which is Linda Alter, the sister of Dennis Alter, and
pursuant to which Mr. Alter is sole trustee. Mr. Alter disclaims beneficial
ownership of these shares.
(2) Ownership includes 82,798 shares of Class A Common Stock and 40,768 shares
of Class B Common Stock held by a charitable foundation established by Mr.
Alter, as to which Mr. Alter shares voting and investment powers, and
41,399 shares of Class A Common Stock and 12,285
4
<PAGE> 7
shares of Class B Common Stock, held by a trust established by Mr. Alter,
through which he has made certain charitable gifts of shares and as to
which Mr. Alter has sole voting and investment powers. Also includes
437,100 shares of Class A Common Stock and 20,000 shares of Class B Common
Stock held by a charitable foundation established by Mr. Alter, as to which
Mr. Alter and his wife share voting and investment powers. Mr. Alter
disclaims beneficial ownership of all such shares.
(3) Ownership does not include 1,010 shares of Class A Preferred Stock owned by
the wife of Dennis Alter.
(4) Ownership includes options to purchase 62,476 shares of Class B Common
Stock pursuant to the Company's Stock Option Plans.
(5) Information as to the holdings of Mr. Hart is as of December 31, 1997 with
respect to shares of Class B Common Stock and as of February 20, 1998 with
respect to options, the most recent practicable dates for which the Company
has information. Ownership includes options to purchase 257,661 shares of
Class B Common Stock pursuant to the Company's Stock Option Plans.
(6) Information as to holdings of Mr. Allhusen is as of December 31, 1997 with
respect to shares of Class B Common Stock and as of February 20, 1998 with
respect to options, the most recent practicable dates for which the Company
has information. Ownership includes options to purchase 54,498 shares of
Class B Common Stock pursuant to the Company's Stock Option Plans.
(7) Ownership includes options to purchase 20,528 shares of Class B Common
Stock pursuant to the Company's Stock Option Plans.
(8) Ownership includes options to purchase 73,766 shares of Class B Common
Stock pursuant to the Company's Stock Option Plans.
(9) Information as to the holdings of Mr. Wesselink is as of February 20, 1998
with respect to shares of Class B Common Stock and options, the most recent
practicable date for which the Company has information. Ownership includes
options to purchase 51,823 shares of Class B Common Stock pursuant to the
Company's Stock Option Plans.
(10) Ownership includes options to purchase 11,715 shares of Class B Common
Stock pursuant to the Company's Stock Option Plans and otherwise.
(11) Ownership includes options to purchase 1,560 shares of Class A Common Stock
and 23,221 shares of Class B Common Stock pursuant to the Company's Stock
Option Plans and otherwise.
(12) Ownership includes options to purchase 1,656 shares of Class A Common Stock
and 29,076 shares of Class B Common Stock pursuant to the Company's Stock
Option Plans.
(13) Ownership includes options to purchase 15,038 shares of Class B Common
Stock pursuant to the Company's Stock Options Plans.
(14) Ownership includes options to purchase 14,192 shares of Class B Common
Stock pursuant to the Company's Stock Option Plans.
(15) Ownership includes options to purchase 7,963 shares of Class B Common Stock
pursuant to the Company's Stock Option Plans.
(16) Ownership includes options to purchase 8,979 shares of Class B Common Stock
pursuant to the Company's Stock Option Plans.
(17) Ownership includes options to purchase 3,216 shares of Class A Common Stock
and 301,861 shares of Class B Common Stock pursuant to the Company's Stock
Option Plans. Ownership does not include any amounts in respect of Messrs.
Hart, Allhusen or Wesselink as neither was serving as a director or officer
of the Company as of April 1, 1998.
5
<PAGE> 8
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's officers and
directors and persons who own more than ten percent of a registered class of the
Company's equity securities (collectively, the "Reporting Persons") to file
reports of ownership and changes in ownership with the SEC and to furnish the
Company with copies of these reports. Based on the Company's review of the
copies of those reports which it has received, and written representations from
Reporting Persons, the Company believes that all filings required to be made by
the Reporting Persons from January 1, 1997 through December 31, 1997 were made
on a timely basis except as noted below. With respect to one transaction,
Phillip Turberg failed to timely file a Form 4; however, this transaction was
subsequently reported on a Form 4 that was filed late.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth, for the Company's last three fiscal years,
the cash compensation paid by the Company, as well as certain other compensation
paid or accrued for those years, to the Named Executive Officers.
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
-----------------------
ANNUAL COMPENSATION AWARDS
------------------------------------------ -----------------------
RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING ALL OTHER
COMPENSATION AWARD(S) OPTIONS COMPENSATION($)
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) ($)(1) ($)(2) (#) (3)(4)(5)(6)
- ---------------------------- ---- --------- -------- ------------ ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Dennis Alter(7)............. 1997 $595,000 $334,730 $ 24,634 $ 0 0 $315,914
Chairman of the Board 1996 $595,000 $ 0 $ 25,715 $1,340,850 0 $261,372
and Chief Executive Officer 1995 $495,000 $222,754 $ 15,732 $ 668,250 0 $200,000
William A. Rosoff........... 1997 $475,000 $542,223 $ 0 $ 0 75,000 $168,490
Vice Chairman 1996 $475,000 $275,000 $ 0 $5,537,500 50,000 $ 9,209
Charles H. Podowski......... 1997 $270,670 $231,250 $ 234 $ 0 28,000 $ 17,200
Chief Executive Officer, 1996 $215,385 $40,033 $ 87 $ 179,977 0 $ 6,705
President and Director, 1995 $150,220 $29,171 $ 0 $ 209,912 25,000 $ 3,918
Advanta Business Services
and President and Director,
Advanta Insurance Companies
Milton Riseman.............. 1997 $323,926 $300,625 $ 3,350 $ 0 25,000 $ 26,812
President and Director, 1996 $275,932 $92,540 $ 3,563 $ 387,587 0 $ 20,122
Advanta Mortgage Corp. USA 1995 $243,462 $81,007 $ 1,784 $ 257,250 40,000 $ 13,654
James J. Allhusen........... 1997 $433,650 $212,500 $ 0 $ 0 30,000 $ 17,764
Executive Vice President 1996 $375,000 $172,455 $ 0 $ 337,279 0 $ 5,357
1995 $ 93,750 $206,152 $330,996(8) $ 393,702 80,000 $ 274
Alex W. Hart................ 1997 $695,000 $521,250 $ 0 $ 0 75,000 $165,298
Chief Executive Officer 1996 $695,000 $ 0 $ 0 $1,790,792 0 $ 95,928
1995 $495,000 $222,757 $429,194(9) $ 668,250 300,000 $ 59,949
David D. Wesselink.......... 1997 $284,587 $78,804 $ 4,379 $ 0 20,000 $ 21,713
Senior Vice President and 1996 $265,469 $33,804 4,469 $ 284,845 0 $ 9,844
Chief Financial Officer 1995 $250,000 $53,528 2,070 $ 262,500 40,000 $ 8,738
</TABLE>
- ---------------
(1) Includes above-market interest earned on deferred compensation pursuant to
the Company's Executive Deferral Plan (which plan first became effective in
1993), in the amounts listed with respect to each year. Mr. Alter received
$24,634, $25,715 and $15,732 for 1997, 1996 and 1995, respectively. Mr.
Podowski received $234 and $87 for 1997 and 1996, respectively. Mr. Riseman
6
<PAGE> 9
received $3,350, $3,563, and $1,784 for 1997, 1996 and 1995, respectively.
Mr. Wesselink received $4,379, $4,469 and $2,070 for 1997, 1996 and 1995,
respectively.
(2) The Advanta Management Incentive Plan With Stock Election II ("AMIP II") was
instituted in 1991 with respect to performance years 1993 through 1995. The
Advanta Management Incentive Plan With Stock Election III ("AMIP III") was
instituted in 1993 for performance years 1996 through 1998. The Advanta
Management Incentive Plan With Stock Election IV ("AMIP IV") was instituted
in 1995 for performance years 1999 through 2001 (AMIP II, AMIP III and AMIP
IV are collectively referred to as the "AMIP Plans"). Pursuant to each of
the AMIP Plans, shares of restricted Common Stock were issued to
participants eligible to participate in each AMIP Plan upon the plan's
commencement or such participant's later employment with the Company (with a
prorated share issuance awarded for any partial year participation). The
number of restricted shares issued to each Named Executive Officer pursuant
to the AMIP Plans is an amount equal to the participant's "target bonus" for
each performance year covered by the applicable AMIP Plan divided by the
applicable grant date price. Shares vest under each of the AMIP Plans ten
years after the date of grant, but are subject to accelerated vesting on the
basis of individual and corporate (or applicable business unit) performance
for each applicable performance year. To the extent that individual and
corporate (or applicable business unit) performance for a given performance
year achieves targeted levels in that year, up to a maximum of one-third of
the total shares granted under the applicable AMIP Plan (or appropriate
proration for participants entering such AMIP Plan after the beginning of
the first performance year thereunder) will become vested. 1995 figures
reflect restricted stock granted pursuant to AMIP IV. In 1995, Messrs.
Alter, Hart, Allhusen, Podowski, Riseman and Wesselink received grants, upon
the commencement of AMIP IV, of 26,730, 26,730, 10,155, 7,104, 10,290 and
10,500 shares of restricted Class B Common Stock, respectively.
In addition to his AMIP III and AMIP IV shares, pursuant to his employment
agreement, Mr. Hart was granted 200,000 shares of restricted Class B Common
Stock in January 1994, of which 50,000 shares were to vest in January of
each year from 1995 to 1998 (subject to earlier vesting in the event of Mr.
Hart's death, disability or retirement, a change of control of the Company,
or certain other circumstances). In addition to his AMIP III and AMIP IV
shares, pursuant to his employment agreement, Mr. Allhusen was granted 5,000
shares of restricted Class B Common Stock in July 1995, of which 1,250 were
to vest in July of each year from 1996 to 1999 (subject to earlier vesting
in the event of Mr. Allhusen's death, disability or retirement, a change of
control of the Company, or certain other circumstances).
1996 figures reflect additional shares of restricted Class B Common Stock
granted pursuant to each of AMIP III and AMIP IV with respect to increases
in the "target" bonuses under such plans, as approved by the Company's
stockholders. The total number of additional shares granted to each Named
Executive Officer (except for Mr. Rosoff whose target bonus was set when he
joined the Company at a level comparable to the new target levels of the
other Named Executive Officers) pursuant to the increases in target bonuses
was: Mr. Alter, 17,031 AMIP III shares and 17,031 AMIP IV shares; Mr. Hart,
22,746 AMIP III shares and 22,746 AMIP IV shares; Mr. Allhusen, 4,284 AMIP
III shares and 4,284 AMIP IV shares; Mr. Podowski, 2,286 AMIP III shares and
2,286 AMIP IV shares; Mr. Riseman, 5,523 AMIP III shares and 4,323 AMIP IV
shares; and Mr. Wesselink, 3,618 AMIP III shares and 3,618 AMIP IV shares.
Mr. Rosoff joined the Company in January 1996 and consequently his 1996
figure includes 27,147 shares of restricted Class B Common Stock pursuant to
AMIP III and 27,147 shares granted pursuant to AMIP IV in respect of his
"target" bonuses for performance years 1996 through 2001. In addition to his
AMIP III and AMIP IV shares, pursuant to his employment agreement which is
described under "Other Matters" on page 21 of this Proxy Statement, Mr.
Rosoff was granted 100,000 shares of restricted Class B Common Stock in
January 1996, of which 25,000 shares were to vest in January of each year
from 1997 to 2000 (subject to earlier vesting in the event of Mr. Rosoff's
death, disability or retirement, a change of control of the Company, or
certain other circumstances). For purposes of this table, the 100,000 shares
of restricted Class B Common Stock
7
<PAGE> 10
granted to Mr. Rosoff pursuant to his employment agreement are valued at
their market value on the date of grant.
In March 1996, a full one-third of the shares issued under AMIP II vested
with respect to Messrs. Alter and Riseman for performance year 1995. With
respect to Messrs. Podowski, Hart, Allhusen and Wesselink, each of whom
joined the Company between December 1993 and December 1995, 100% of the
shares that had been issued under AMIP II at the time each person joined the
Company in respect of such person's "target bonus" for performance year 1995
were vested in March 1996. Mr. Rosoff was not employed by the Company during
performance year 1995.
In March 1997, ninety percent (90%) of one-third of the shares (including
the additional shares described above) issued under AMIP III vested with
respect to each of Messrs. Alter, Hart, and Rosoff, and a full one-third of
the shares issued under AMIP III (including the additional shares described
above) vested with respect to the other Named Executive Officers for
performance year 1996. The remaining ten percent (10%) of one-third of the
shares issued under AMIP III (the "frozen shares") that did not vest for
each of Messrs. Alter and Rosoff were available for accelerated vesting in
future years in the event of an award made in future years that exceeds the
executive's target bonus for that year.
In March 1998, a full one-third of the shares issued under AMIP III
(including the additional shares described above) and all of the frozen
shares that did not vest in March 1997 vested, for performance year 1997,
for Messrs. Alter and Rosoff. A full one-third of the shares issued under
AMIP III (including the additional shares described above) vested, for
performance year 1997, with respect to all of the other Named Executive
Officers except for Mr. Hart who, in connection with his departure from the
Company in February 1998, received the cash equivalent of one-third of the
shares issued under AMIP III.
The number of unvested restricted shares of Class B Common Stock held by
each Named Executive Officer under AMIP III and AMIP IV and by Mr. Hart and
Mr. Rosoff under the contractual arrangements described above, and the
market value (rounded to the nearest dollar) of such restricted shares at
December 31, 1997, were as follows: Mr. Alter, 83,199 shares, $2,111,175;
Mr. Hart, 110,188 shares, $2,796,021; Mr. Rosoff, 121,150 shares,
$3,074,181; Mr. Allhusen, 21,752 shares, $551,957; Mr. Podowski, 15,650
shares, $397,119; Mr. Riseman, 26,531 shares, $673,224; and Mr. Wesselink,
21,668 shares, $549,826. Non-preferential dividends are paid on these
restricted shares.
(3) Includes matching contributions of $8,000 paid by the Company to the
accounts of each of the Named Executive Officers under the Employee Savings
Plan (a 401(k) Plan), in respect of their 1997 participation in such plan.
(4) Includes the value of (i) Company paid term life insurance provided to all
salaried employees in an amount equal to two times annual salary (capped at
$500,000), and (ii) whole life insurance policies on the lives of each of
the Named Executive Officers other than Mr. Riseman, which policies are paid
for by the Company and as to which the Named Executive Officer has the right
to designate the beneficiary (the "Split Dollar Life Insurance Policies").
If an insured executive terminates his employment with the Company, he may
keep the Split Dollar Life Insurance Policy, but must pay the Company the
full cash value of the policy. Consequently, the value of the Split Dollar
Life Insurance Policy to the employee is the term life insurance benefit.
The aggregate value of these benefits to the named individuals is included
in the figures for 1997 in the following amounts: Mr. Alter, $32,930; Mr.
Rosoff, $11,518; Mr. Riseman, $6,318; Mr. Podowski, $3,645; Mr. Hart,
$11,700; Mr. Allhusen, $3,736; and Mr. Wesselink, $5,374.
(5) Includes interest paid in 1997 by the Company on behalf of Messrs. Rosoff,
Podowski, Riseman, Hart, Allhusen and Wesselink pursuant to an executive
loan program adopted by the Company's Board of Directors in 1992, which
interest accrued on the Named Executive Officers' respective stock margin
accounts in connection with margin loans against shares vested under the
AMIP Plans and a predecessor stock bonus plan (and for Messrs. Hart and
Allhusen, shares
8
<PAGE> 11
vested under their employment agreements as described in note (2) above),
in the following amounts: Mr. Rosoff, $2,419; Mr. Podowski, $3,119; Mr.
Riseman, $12,494; Mr. Hart, $134,350; Mr. Allhusen, $3,678; Mr. Wesselink,
$5,945. Information for Mr. Rosoff also includes $121,152, which represents
compensation attributed to original-issue-discount income and taxes arising
from non-interest-bearing loans made by the Company to Mr. Rosoff to
satisfy his tax liabilities resulting from the vesting of the restricted
shares granted pursuant to his employment agreement.
(6) Includes the value of Split Dollar Life Insurance Policies insuring the
lives of each of the Named Executive Officers other than Mr. Riseman the
proceeds of which policies are payable to beneficiaries designated by the
respective executives. The value of the term life insurance premiums paid by
or on behalf of the Company under such policies for the named individuals is
included in the figures set forth in footnote (4) above in the following
amounts for 1997: Mr. Alter, $30,438; Mr. Rosoff, $8,926; Mr. Podowski,
$1,108; Mr. Hart, $7,650; Mr. Allhusen, $1,377; and Mr. Wesselink, $1,390.
Premiums paid by the Company will be refunded to the Company on termination
of the respective policies, and any cash surrender value in excess of such
premiums may be paid to the executive's beneficiary. The value of the
benefits to the executives of the remainder of the premiums paid by the
Company are included in the amounts listed with respect to each year. For
1997: Mr. Alter, $274,984; Mr. Rosoff, $25,401; Mr. Podowski, $2,436; Mr.
Allhusen, $2,350; Mr. Hart, $11,248; and Mr. Wesselink, $2,394.
(7) Mr. Alter served as Chief Executive Officer of the Company from January
through July of 1995 and from October 1997 until the present.
(8) Represents the value of relocation benefits provided to Mr. Allhusen in
1995.
(9) Represents the value of relocation benefits provided to Mr. Hart in 1995.
9
<PAGE> 12
STOCK OPTION GRANTS
The following table contains information concerning the grant of stock
options under the Company's 1992 Stock Option Plan to the Company's Chief
Executive Officer and to each of the Named Executive Officers. All options
granted in 1997 are options to purchase shares of Class B Common Stock. Prior to
February 1998, the Company had not made any grants of stock appreciation rights
("SARs") to its executive officers.
OPTION GRANTS IN LAST FISCAL YEAR(1)
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
----------------------------------------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS GRANT DATE
UNDERLYING GRANTED TO EXERCISE OR VALUE
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION GRANT DATE
NAME GRANTED(#) FISCAL YEAR ($/SH) DATE PRESENT VALUE(2)
- --------------------------------- ---------- ------------ ----------- ---------- ----------------
<S> <C> <C> <C> <C> <C>
William A. Rosoff................ 75,000 7.8% $45.00 1/22/07 $1,823,250
Charles H. Podowski.............. 18,000 1.9% $45.00(3) 1/22/07 $ 437,580
10,000 1.0% $22.63 4/16/07 $ 113,100
Milton Riseman................... 25,000 2.6% $45.00(3) 1/22/07 $ 607,750
James J. Allhusen................ 30,000 3.1% $45.00(3) 1/22/07 $ 729,300
Alex W. Hart..................... 75,000 7.8% $45.00 1/22/07 $1,823,250
David D. Wesselink............... 20,000 2.1% $45.00(3) 1/22/07 $ 486,200
</TABLE>
- ---------------
(1) Options granted in 1997 become exercisable on the anniversary of the date of
grant at the rate of 25% per year for four years. The options expire 10
years from the date of grant. In February 1998, in connection with the
Tender Offer (as defined herein), the Company accelerated the vesting of
43.15% of all outstanding unvested options to purchase Common Stock,
including the options granted to Named Executive Officers in 1997.
(2) With respect to the options granted in January 1997, the fair value of the
options granted is estimated on the date of grant using the Black Scholes
option pricing model with the following assumptions: risk-free interest rate
of 6.74%; expected dividend yields of 1.17%; expected life of ten years' and
expected volatility of 38.89%. With respect to the options granted in April
1997, the fair value of the options granted is estimated on the date of
grant using the Black Scholes option pricing model with the following
assumptions: risk-free interest rate of 7.10%; expected dividend yields of
2.33%; expected life of ten years; and expected volatility of 44.77%.
(3) These options were repriced to an exercise price of $25.875
per share on March 31, 1997. See "10-year Option Repricings." Grant date
value of these options does not reflect this repricing.
10
<PAGE> 13
STOCK OPTION EXERCISES AND HOLDINGS
The following table sets forth information related to options exercised
during 1997 by the Named Executive Officers, and the number and value of options
held on December 31, 1997 by such individuals. As of December 31, 1997 the
Company did not have any outstanding SARs.
AGGREGATE OPTION EXERCISES IN LAST YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
OPTIONS AT FY-END (#) FY-END ($)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Dennis Alter............. 0 $0 337,500 0 $4,079,449 $ 0
William A. Rosoff........ 0 $0 25,000 100,000 $ 0 $ 0
Charles H. Podowski...... 0 $0 12,500 40,500 $ 0 $ 27,500
Milton Riseman........... 0 $0 113,750 38,750 $ 810,674 $ 0
James J. Allhusen........ 0 $0 70,000 40,000 $ 0 $ 0
Alex W. Hart............. 0 $0 387,500 137,500 $ 0 $ 0
David D. Wesselink....... 0 $0 57,500 52,500 $ 0 $ 0
</TABLE>
- ---------------
(1) Does not reflect the acceleration of vesting of 43.15% of all outstanding
unvested options to purchase Common Stock in connection with the Tender
Offer.
11
<PAGE> 14
The following table sets forth certain information concerning the repricing
of options during the last ten years held by any person who was an executive
officer of the Company during that period.
10-YEAR OPTION REPRICINGS
<TABLE>
<CAPTION>
LENGTH OF
NUMBER OF MARKET ORIGINAL
SECURITIES PRICE EXERCISE OPTION TERM
UNDERLYING OF STOCK PRICE AT REMAINING AT
OPTIONS AT TIME OF TIME OF NEW DATE OF
REPRICED REPRICING OR REPRICING OR EXERCISE REPRICING OR
NAME DATE OR AMENDED AMENDMENT AMENDMENT PRICE AMENDMENT
- --------------------------------- ------- ---------- ------------ ------------ -------- -------------
<S> <C> <C> <C> <C> <C> <C>
Charles H. Podowski.............. 3/31/97 18,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Chief Executive Officer,
President and Director, Advanta
Business Services and President
and Director, Advanta Insurance
Companies
Milton Riseman................... 3/31/97 25,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
President and Director,
Advanta Mortgage Corp. USA
James J. Allhusen................ 3/31/97 30,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Executive Vice President
David D. Wesselink............... 3/31/97 20,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Senior Vice President and
Chief Financial Officer
Jeffrey D. Beck.................. 3/31/97 6,250 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Vice President and Treasurer
John J. Calamari................. 3/31/97 6,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Vice President, Finance
Ronald W. Averett................ 3/31/97 4,000 $25.875 $45.00 $26.875 9 yrs. 10 mo.
Vice President, Advanta Personal
Payment Services
Renee B. Booth................... 3/31/97 18,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Senior Vice President, 9/30/96 30,000 $25.875 $42.75 $25.875 9 yrs. 6 mo.
Human Resources
David Brooks..................... 3/31/97 100,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
President and Chief Operating
Officer
Christopher Derganc.............. 3/31/97 16,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Senior Vice President, Corporate
Administration
Katharin Dyer.................... 3/31/97 7,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Vice President, Marketing,
Advanta Personal Payment Services
Michael A. Girman................ 3/31/97 3,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Vice President, Audit and Control
James John....................... 3/31/97 28,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Senior Vice President, Advanta
Personal Payment Services
Arthur D. Kranzley............... 3/31/97 20,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Senior Vice President
Albert E. Lindenberg............. 3/31/97 20,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
President, Advanta Business
Services
Edward E. Millman................ 3/31/97 5,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Senior Vice President and Chief
Financial Officer, Advanta
Business Services
John W. Roblin................... 3/31/97 13,000 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Senior Vice President
Gene S. Schneyer................. 3/31/97 6,250 $25.875 $45.00 $25.875 9 yrs. 10 mo.
Vice President, Secretary and
General Counsel
</TABLE>
12
<PAGE> 15
COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Compensation programs for the Company's leaders are intended to further the
earnings of the Company and secure, retain and motivate management employees of
high caliber and potential. The programs described herein cover those employees
whose decision-making and leadership drives the achievement of the Company's
business strategies. There are three major components of executive compensation
at the Company: base salary, annual incentive awards, and long-term incentive
awards.
The Compensation Committee of the Board of Directors (the "Committee") is
responsible for establishing the Company's overall compensation philosophy and
strategy, and monitoring the implementation thereof. However, the Compensation
Committee's determinations regarding compensation of members of the Office of
the Chairman (consisting of the Chairman, Chief Executive Officer and Vice
Chairman during 1997) are reviewed and approved by the full Board of Directors
(excluding the management directors).
The executive compensation program includes base salary, performance-based
annual and long-term incentives and stock options. Target levels of overall
compensation are intended to be consistent with a selected peer group of
companies (the "peer group"). While some of these companies are in the Dow Jones
Diversified Financial Services Index and some are not, they were generally
selected for the peer group because they were considered comparable to the
Company either in terms of market capitalization, or because they compete with,
or are in lines of business related to, the Company's businesses. For several
years total compensation packages have emphasized programs contingent upon the
Company's short and long-term performance as measured by the appreciation in the
value of the Company's publicly traded shares. Due to the emphasis on corporate
performance and stockholder value when computing total executive compensation,
each year the Company's executives could be paid more or less than the peer
group's executives, depending upon how the Company has performed and the changes
in value of its shares. Given the Company's departure from the consumer credit
card services business, the Committee recognizes that the industry peer group
for 1998 and beyond may differ from prior years.
BASE SALARIES
The Committee establishes base salaries based upon periodic comparisons to
the salaries paid by companies in the peer group. The Company's philosophy is to
limit fixed costs in its executives' compensation by emphasizing the variable
components of total compensation, i.e., annual and long-term incentives. Base
salaries are intended to approximate the median base salaries of the comparator
companies. Changes in base salary were made for all of the Named Executive
Officers, other than Messrs. Alter, Rosoff and Hart, during 1997.
Promotional salary increases were granted to Messrs. Allhusen and Podowski
during 1997 to reflect their increased accountability in assuming the management
of the Company's Personal Payment Services business unit and Business Services
business unit, respectively, in addition to other business units they were
already managing. Mr. Riseman's and Mr. Wesselink's salaries were increased in
1997 to reflect movement in the competitive market as well as performance.
ANNUAL INCENTIVES
Each executive officer has an annual "target" bonus, specified as a
percentage (determined by the executive's position in the Company) of his
January 1 base salary. For 1997, the Named Executive Officers' target bonuses
ranged from 50% (Messrs. Allhusen, Podowski, Riseman and Wesselink) to 75%
(Messrs. Alter, Rosoff and Hart) of base salary. The actual award, if any, for a
given year's performance is determined by a "subcommittee" of the Compensation
Committee,
13
<PAGE> 16
comprised of Mr. Botel, Ms. Becker-Dunn, and Mr. Lubner, all three of whom are
"non-employee directors" (as defined in applicable SEC rules). In the case of
compensation for members of the Office of the Chairman, such recommendation is
then approved by the full Board of Directors.
The criteria for 1997 performance year annual incentives were financially
focused, tied most heavily to the achievement of targeted earnings for the year
to effect a recovery following the Company's first quarter loss and performance
of the executive during the Company's process of exploring strategic
alternatives. Factored in as well were performance with regard to improving the
Company's knowledge and servicing of customer needs and developing leadership
within the employee population. Additionally, while the Committee believes the
performance of the Company overall remains a vital consideration, in the awards
of those reporting to the Office of the Chairman, the performance of the
individual strategic business unit is now weighed more heavily than in the past.
Given the successful achievement of the Company's stated earnings goals and
successful execution of the Fleet Transaction (as defined herein), the
subcommittee recommended awards for Messrs. Alter and Rosoff to be at 185% of
target. Messrs. Hart and Allhusen each received an award of 100% of target and
Mr. Wesselink received an award equal to 150% of target. Awards for Mr. Riseman
and Mr. Podowski were at 185% of target, in recognition of their strong
leadership of the Company's Mortgage and Business Services business units during
1997. Each of those business units performed extremely well during the year, and
were integral to the Company's earnings.
Rather than receiving their annual incentives for 1997 performance in the
form of cash, the Named Executive Officers who received awards for 1997
performance generally received the amounts below and up to "target" in the form
of restricted stock, which is accelerated in its vesting according to AMIP III.
Because of the long-term incentive nature of the shares associated with the AMIP
Plans, more detail is given in the following section. The AMIP Plans and the
annual incentive plan are interlinked, and with respect to executive
compensation, can be considered components of a single plan.
In 1997, the Company adopted the special retention programs, under which a
shortfall in the value of restricted stock awards that vested in 1997 and 1998
would be made up several months after the date of vesting as long as the
recipient remained an employee of the Company or a successor entity. The
programs allowed the Company to provide a retention incentive, the amount of
which is determined by an individual's actual past performance (if an individual
did not receive an award of shares there would be no shortfall in value and the
individual would not be able to earn a future payment under the program).
LONG-TERM INCENTIVES
The Company offers its senior executives two forms of long-term incentive:
restricted stock (primarily delivered through the AMIP Plans) and stock options.
The Committee believes that share ownership aligns the interests of
participating officers and executives with the interests of the Company's
stockholders and ties a significant portion of senior officer compensation to
stockholder returns.
Messrs. Alter and Riseman entered the AMIP III restricted stock program
upon its introduction in 1994, and their future target bonuses for the years
1996, 1997 and 1998 were issued in the form of restricted stock priced at the
then-market price of $17.00 per share. Upon joining the Company, Messrs. Hart,
Rosoff, Podowski, Wesselink and Allhusen entered the AMIP III Plan, and their
1996, 1997 and 1998 bonuses were issued in the form of restricted stock as well,
but at higher prices. While the stock will ultimately "cliff-vest" ten years
after it has been issued (as long as the executive remains employed by the
Company), the intent is for each executive to "earn" an accelerated vesting by
enabling the Company to achieve performance goals in the performance years for
which the plan is intended to cover.
14
<PAGE> 17
Similarly, each of the Named Executive Officers remaining with the Company
has been issued restricted stock under AMIP IV in respect of his target bonus
awards for performance in 1999, 2000, and 2001. If, upon accelerated vesting of
shares in respect of performance for a given performance year, the share price
is higher than the valuation price at which the shares were originally issued,
the executive in effect receives a long-term incentive in the form of the
stock's appreciation in value.
STOCK OPTIONS
The Stock Option Plan rewards long-term accomplishment, based upon
increases in stockholder value. Options are generally granted annually, subject
to the subcommittee's determination. The exercise price of options is 100% of
fair market value on the date of grant, typically the closing price. Options
vest in equal portions over a four year period, and expire 10 years after the
grant date.
In January of 1997 the Committee approved the annual grant of stock options
to employees, including the Named Executive Officers, with the exception of Mr.
Alter. At the request of Mr. Alter, the subcommittee did not grant any options
to him in 1997.
In March 1997 the subcommittee recommended the repricing of stock options
granted to certain employees who were hired during 1996 and all employees (other
than the members of the Office of the Chairman) who received options in the
January 1997 grant. These stock options were significantly out-of-the-money, and
were not otherwise useful as a realistic retention or incentive device.
IMPACT OF IRS PAY CAP REGULATION
Section 162(m) of the Internal Revenue Code limits the types of annual
compensation in excess of $1,000,000 that may be deducted for federal income tax
purposes for payments to a company's Chief Executive Officer and its four other
most highly compensated Executive Officers. The Committee believes that payment
of Compensation that is not deductible under Section 162(m) is sometimes in the
best interests of the Company, and the Committee and the Board of Directors have
accordingly approved such arrangements in certain circumstances.
THE CHIEF EXECUTIVE OFFICER'S 1997 COMPENSATION
Mr. Hart held the CEO position from mid-1995 until October of 1997, and in
that role was given a total compensation opportunity competitive within the
Company's peer group of companies. On October 28, 1997, when the Company
announced that Mr. Hart was leaving the Company, the Board of Directors asked
Chairman Dennis Alter to resume the role of Chief Executive Officer, a position
he held from August 1972 through mid-1995. The Committee believes Mr. Alter's
compensation does not exceed the appropriate compensation for his role as
Chairman and Chief Executive Officer of the Company, but will continue to
evaluate the compensation levels on an ongoing basis.
The criteria for awarding annual incentives for the 1997 performance year
for the Chief Executive Officer are the same as the criteria described above for
other executive officers under "Annual Incentives." The subcommittee recommended
awarding Mr. Hart a bonus equal to 100% of the targeted amount and Mr. Alter a
bonus equal to 185% of the targeted amount. These recommendations were approved
by the Board of Directors (excluding the management directors). In addition,
pursuant to the Company's special retention programs, Mr. Hart received a
payment representing the shortfall between the market price on March 20, 1997
and the original grant date value of his restricted shares which were vested in
1997 for performance in 1996. Mr. Alter did not incur such a shortfall and did
not receive such a payment.
As CEO, Mr. Hart was eligible to participate in the stock option program,
as were the other Named Executive Officers. Mr. Hart received 75,000 options in
January of 1997 as part of the annual stock option grant offered to the other
Named Executive Officers. While Mr. Alter was eligible for a grant of stock
options, he declined such an award.
COMPENSATION COMMITTEE
Max Botel, Chairman Dana Becker-Dunn Arthur P. Bellis* Ronald Lubner
* Mr. Bellis is involved in designing the compensation plans but does not vote
on incentive compensation for the Named Executive Officers.
15
<PAGE> 18
STOCK PERFORMANCE GRAPH
The following graph compares the yearly percentage change in the cumulative
total stockholder return on the Company's Class A Common Stock during the five
years ended December 31, 1997 with the cumulative total return on the Standard &
Poor's 500 index and the Dow Jones-Diversified Financial Services Companies
index. The comparison assumes that $100 was invested on January 1, 1993 in the
Class A Common Stock and in the foregoing indices and assumes the reinvestment
of dividends. The price and performance of the Class A Common Stock has been
adjusted to reflect the three-for-two stock split effected by means of a 50%
stock dividend in October 1993, as if such dividends had already occurred at
January 1, 1993.
<TABLE>
<CAPTION>
Diversified
Measurement Period Financial
(Fiscal Year Covered) Advanta Services S&P 500
<S> <C> <C> <C>
1/1/93 100.00 100.00 100.00
Dec-93 154.90 115.20 110.10
Dec-94 123.40 113.10 111.50
Dec-95 180.40 182.80 153.00
Dec-96 203.00 248.40 188.70
Dec-97 128.60 399.10 251.60
</TABLE>
16
<PAGE> 19
ELECTION OF DIRECTORS
The Board of Directors has nominated five candidates to be elected at the
Meeting for a three-year term ending in 2001. Each nominee is currently serving
as a director of the Company. Five other directors are currently serving terms
which will expire in 1999 or 2000.
Each nominee has consented to being named in the proxy statement and to
serve if elected. Candidates for director will be elected by a plurality of the
votes of the shares present in person or represented by proxy at the Meeting and
entitled to vote on the election of directors, assuming a quorum is present at
the Meeting. If prior to the Meeting any nominee should become unavailable to
serve, the shares represented by a properly executed and returned proxy will be
voted for such additional person as shall be designated by the Board of
Directors, unless the Board should determine to reduce the number of directors
pursuant to the By-Laws.
Certain information regarding each nominee and each director continuing in
office is set forth below, including such individual's age and principal
occupation, a brief account of business experience during at least the last five
years and other directorships currently held at other publicly held companies.
Messrs. Alter, Bellis and Botel have been directors of the Company since
its incorporation in 1974. Messrs. Dunkelberg, Hall, Ksansnak, Rosoff, Lubner,
Ms. Becker Dunn and Mr. Olafsson were first elected by the Board in June 1990,
September 1994, August 1995, February 1996, December 1996, March 1996 and
December 1997, respectively.
NOMINEES FOR ELECTION FOR A TERM EXPIRING IN 2001
Dennis Alter Dana Becker Dunn
Arthur P. Bellis Robert C. Hall
William C. Dunkelberg
Mr. Alter, age 55, became Executive Vice President and a Director of the
Company's predecessor organization in 1967. He was elected President and Chief
Executive Officer in 1972, and Chairman of the Board of Directors of the Company
in August 1985. In February 1986, he relinquished the title of President, and in
August 1995 he relinquished the title of Chief Executive Officer. In October
1997, Mr. Alter resumed the title of Chief Executive Officer.
Mr. Bellis, age 54, has been a private investor since January 1993. Prior
to that time, from March 1986 he was Chairman and, until June 1991, Chief
Executive Officer of Boca Bank, Boca Raton, Florida. He was also Chairman and
Chief Executive Officer of Boca Bancorp, Inc., the bank's holding company, from
its formation in December 1986. Mr. Bellis has served on the Board of United Way
International since December 1993 and is currently Vice Chairman of that Board.
Dr. Dunkelberg, age 55, is Professor of Economics and Director at the
School of Business and Management at Temple University. He served as Dean of the
School of Business and Management at Temple from 1987 through 1994. Prior to
that, Dr. Dunkelberg was a professor of economics and management at Purdue and
Stanford Universities. As an authority on consumer credit and small business, he
is a member of the U.S. Census Advisory Committee and the Board of the National
Bureau of Economic Research, as well as Chief Economist of the National
Federation of Independent Business.
Mr. Hall, age 66, is Vice President of The Thomson Corporation, with
responsibilities for technology and global expansion. Until January 1995, Mr.
Hall was Chief Executive Officer of the Thomson Information/Publishing Group, a
worldwide operation with $3.0 billion in sales, 140 companies, and 22,000
employees, and a member of The Thomson Corporation Board of Directors. From 1984
to 1992 Mr. Hall was Vice Chairman, then Chairman, of WICAT Systems, a
developing education system company.
17
<PAGE> 20
Ms. Becker Dunn, age 47, is Vice President, Marketing and Strategic
Business Planning, of Lucent Technologies Business Communications Services
("BCS"), formerly AT&T Global Business Communications, which she joined in
December 1994. BCS develops, manufactures, markets and services advanced
communications and multimedia systems for business and government customers in
more than 90 countries worldwide. In 1992 she became Vice President and Chief
Technical Officer for AT&T's Call Servicing (Long Distance) Organization, after
which she was Vice President of Strategic Planning and New Business Development
for Consumer Communications Services. From 1984 to 1992, Ms. Dunn served AT&T in
a variety of capacities, including Product Marketing Director in 1984, Director
of Information Systems in 1986 and Operator Services-Eastern Region Vice
President in 1988.
THE BOARD OF DIRECTORS RECOMMENDS VOTING "FOR" THE ELECTION OF ALL FIVE
NOMINEES FOR ELECTION.
INCUMBENT DIRECTORS CONTINUING IN OFFICE FOR A TERM EXPIRING IN 1999
Max Botel James E. Ksansnak Ronald Lubner
Mr. Botel, age 58, retired from the law firm of Botel, Binder & Weiss in
July 1996, where he had been a partner for more than five years. From February
1985 he also served as Vice President of Penn Center Investments, Inc., a
securities brokerage firm, of which firm he became President in January 1995.
Mr. Ksansnak, age 58, is Vice Chairman of the Board of ARAMARK Corporation
and is a member of their Board of Directors. He has been with ARAMARK since May
1986 and before becoming Vice Chairman in May 1997, he was Executive Vice
President and Chief Executive Officer, responsible for financial matters,
planning and development, tax, internal audit and information technology across
all business units. Before joining ARAMARK he had been a partner of Arthur
Andersen & Co. since 1971. In 1974, he became Partner-in-Charge of the Audit
Practice in Philadelphia, and was Managing Partner of the Philadelphia office
from 1979 to 1986. Mr. Ksansnak sits on the board of directors of CSS
Industries, Inc.
Mr. Lubner, age 64, is Chairman and Chief Executive Officer of Plate Glass
and Shatterprufe Industries, a company quoted on the Johannesburg, South Africa
Stock Exchange. Mr. Lubner is a 40-year veteran of the Plate Glass Group, which
has annual sales of $1.5 billion. Headquartered in Johannesburg, the company
manufactures and distributes the complete range of glass and board products for
the building, automotive and furniture industries, and is the undisputed world
leader in the field of automotive glass repair and replacement.
INCUMBENT DIRECTORS CONTINUING IN OFFICE FOR A TERM EXPIRING IN 2000
Olaf Olafsson William A. Rosoff
Mr. Olafsson, age 35, joined the Company in September 1996 as Vice Chairman
of Advanta Information Services, Inc. ("AIS"), a subsidiary of the Company, and
was elected as a Director of AIS in October 1996. In December 1997, Mr. Olafsson
became a Director of the Company and in March 1998 he was elected President of
the Company. Prior to joining AIS, he was president and chief executive officer
of Sony Interactive Entertainment, Inc., a business unit of Sony Corporation,
which he founded in 1991.
Mr. Rosoff, age 54, joined the Company in January 1996 as Vice Chairman and
a Director. Prior to joining the Company, Mr. Rosoff was a long time partner of
the law firm of Wolf, Block, Schorr and Solis-Cohen LLP, the Company's outside
counsel, where he advised the Company for over 20 years. While at Wolf, Block,
Schorr and Solis-Cohen LLP he served as Chairman of its Executive Committee and,
immediately before joining the Company, as a member of its Executive Committee
and Chairman of its Tax Department. Mr. Rosoff is a Trustee of Atlantic Realty
Trust, a publicly held real estate investment trust, and Chairman of the Board
of RMH Teleservices, Inc., a publicly
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held company that is a leading provider of telemarketing services, on an
outsourced basis, to Fortune 500 companies. (For a description of Mr. Rosoff's
employment agreement with the Company, see "Other Matters" on page of this
proxy statement.)
COMMITTEES, MEETINGS AND COMPENSATION OF THE BOARD OF DIRECTORS
The Board of Directors held eleven meetings during the last fiscal year.
All directors attended at least 75% of the aggregate number of meetings of the
Board and committees of the Board on which they served.
The Board of Directors has an Audit Committee currently composed of Messrs.
Dunkelberg and Ksansnak. The Audit Committee reviews and evaluates the Company's
internal accounting and auditing procedures; recommends to the Board of
Directors the firm to be appointed as independent accountants to audit the
Company's financial statements; reviews with management and the independent
accountants the Company's year-end operating results; reviews the scope and
results of the audit with the independent accountants; reviews with management
the Company's interim operating results; and reviews the non-audit services to
be performed by the firm of independent accountants and considers the effect of
such performance on the accountants' independence. The Audit Committee met four
times in 1997.
The Board of Directors has appointed a Compensation Committee currently
composed of Messrs. Bellis, Botel and Lubner and Ms. Becker Dunn. The
Compensation Committee reviews and approves Company-wide benefit programs and
executive compensation programs, and, where appropriate, reviews and approves
individual arrangements for persons designated as "officers" for the purposes of
Section 16 of the Exchange Act ("Section 16 Officers"). The Committee also
recommends and approves compensation arrangements for outside Directors and
serves in an advisory capacity to the full Board regarding compensation matters.
The Compensation Committee met five times in 1997.
The Board of Directors has established a committee (the "Plan
Administration Committee") to administer the Company's Stock Option and AMIP
Plans (the "Plans"). The Plan Administration Committee acted by consent
thirty-four times during 1997. The Plan Administration Committee is divided into
two subcommittees. One subcommittee, currently composed of Mr. Botel, Ms. Becker
Dunn and Mr. Lubner (each of whom is a "disinterested person" under applicable
SEC rules), administers the Plans with respect to Section 16 Officers. The other
subcommittee, currently composed of Messrs. Alter and Rosoff, administers the
Plans with respect to non-Section 16 Officers. The Plan Administration Committee
also has authority to designate whether options granted are intended to qualify
as incentive stock options or are to be non-qualified stock options. The Board
of Directors, as a whole, administers the Plans with respect to non-employee
Directors.
The Board of Directors has a Nominating Committee to identify and recommend
to the Board of Directors individuals to serve on the Board, which individuals
are to be selected, according to the Board resolution establishing the
Nominating Committee, on the basis of their integrity, leadership ability,
financial sophistication and capacity to help guide the Company successfully
into the 21st century. The current members of the Nominating Committee are
Messrs. Alter, Bellis and Lubner. The Nominating Committee met once in 1997. The
Nominating Committee will consider nominees recommended by stockholders; any
such nominations must comply with the requirements of the Company's By-Laws,
including timely delivery to the Company of a written request from a stockholder
of record that an individual's name be placed in nomination. Such written notice
must set forth certain information with respect to the nomination, including:
the name and address of the nominating stockholder; the name and address of the
beneficial owner, if different than the nominating stockholder, of the shares
owned of record by the nominating stockholder; the number and class of shares
owned by such nominating stockholder and beneficial owner; a description of all
arrangements and understandings between the nominating stockholder, any
beneficial owner and any persons nominated; the name and address of any persons
nominated; a representation that the
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nominating stockholder is a holder of record of the Company's shares entitled to
vote at the meeting and intends to appear in person or by proxy at the meeting
to nominate such persons; such other information regarding each nominee as would
have been required to be included in a proxy statement filed pursuant to the
proxy disclosure rules of the SEC had the nominee been nominated by the Board of
Directors of the Company; and the written consent of each nominee to serve as a
director. To be timely, such notice must, in the case of an annual meeting that
is called for a date that is within 30 days before or after the anniversary date
of the immediately preceding annual meeting, be delivered not less than 60 nor
more than 90 days prior to such anniversary date, or, in the case of any other
annual meeting or any special meeting, not later than the close of business on
the fifth day following the earlier of the day on which notice of the date of
meeting was mailed or publicly disclosed.
In June 1995, the Board of Directors established a Corporate Governance
Committee to identify, analyze and propose approaches and solutions to issues of
importance relating to the long-term effectiveness of the Board of Directors and
senior management of the Company, including for example, issues relating to
succession planning, retirement policies and performance measurement. The
current members of the Corporate Governance Committee are Messrs. Alter, Hall
and Bellis.
Members of the Board of Directors who are not officers or employees of the
Company receive an annual retainer of $25,000 for service on the Board, $10,000
as an annual retainer for service on a Board Committee (other than as a
Committee chairperson, for whom the annual retainer is $15,000), and are paid
$1,000 per day for each Board or Board Committee meeting attended (chairmen are
paid $1,500 per day for each Committee meeting they chair). However, Messrs.
Botel and Lubner and Ms. Becker Dunn are not compensated separately for serving
on the Plan Administration Committee, as such service is considered ancillary to
their service on the Compensation Committee. The chairmen of the Audit
Committee, the Compensation Committee, the Nominating Committee and the
Corporate Governance Committee are Messrs. Ksansnak, Botel, Bellis and Hall,
respectively. In addition, for each non-employee Director, the Company pays the
premiums on a $500,000 term life insurance policy on which there is no build-up
in cash value, but as to which the non-employee Director has the right to
designate the beneficiary under the applicable policy. Under the Company's 1992
Stock Option Plan each non-employee Director currently receives an annual grant,
generally on the fourth Wednesday in January, of an option to purchase 7,500
shares of Class B Common Stock, at an exercise price equal to the fair market
value of such stock on the grant date. Each such option becomes exercisable on
the anniversary of the grant date at the rate of 25% per year for four years,
and expires ten years from the grant date. Directors are reimbursed for expenses
incurred in attending meetings of the Board of Directors and committees thereof.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS
In 1995, the Company engaged Mr. Bellis as a consultant to assist in the
evaluation of certain new business opportunities. During 1997, the Company paid
Mr. Bellis for his services at the rate of $14,000 per month plus reimbursement
of expenses. The consulting fees paid to Mr. Bellis in 1997 totaled $154,000,
plus $38,108 of expense reimbursement.
CHANGE IN CONTROL AND SEVERANCE ARRANGEMENTS
In March 1997, the Company's Compensation Committee of the Board of
Directors approved the Advanta Senior Management Change of Control Severance
Plan (the "Management Severance Plan") which provides benefits to senior
management employees, including the Named Executive Officers, in the event of a
Change of Control of the Company (as defined in the Management Severance Plan)
if, within one year of the date of the Change of Control, there has been either
an actual or constructive termination of the senior management employee. In
February 1998, pursuant to the Company's agreement with Fleet Financial Group,
Inc. ("Fleet") the Compensation Committee of the Board of Directors approved an
amendment to the Management Severance Plan that
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allows the Office of the Chairman, in its sole discretion, to extend the level
of benefits that would otherwise be allowed in the event of a Change of Control
to employees who become employees of Fleet Credit Card LLC (the "LLC") or whose
employment with the Company is otherwise terminated in connection with the
completion of the Fleet Transaction (the "Affected Employees"). The Board of
Directors also authorized the Chairman, in his sole discretion, to pay bonuses
to certain key employees (including Named Executive Officers who are Affected
Employees) in recognition of their efforts on behalf of the Company in the
strategic alternatives process. In accordance with the Company's agreement with
Fleet, the LLC agreed to assume the Company's Management Severance Plan and 50%
of the bonus payments with respect to those Affected Employees who become
employees of the LLC in connection with the Fleet Transaction. The Company
accelerated vesting of 43.15% of outstanding options that
were not vested at the time of the closing of the Fleet Transaction. With
respect to Affected Employees, including Named Executive Officers who are
Affected Employees, the Company also amended the terms of their outstanding
stock options to extend the exercise period for all options that were
vested as of the date the Affected Employee ceased to be an employee of the
Company for a period that will expire on February 20, 1999. In May 1997, the
Board of Directors adopted the Office of the Chairman Supplemental Compensation
Program (the "Supplemental Plan") under which Messrs. Alter, Rosoff and Hart
would be entitled to receive benefits in the event of a Change of Control or
other similar transaction.
On February 20, 1998, the Company contributed substantially all of the
assets of its consumer credit card business to the LLC, a limited liability
company controlled by Fleet (the "Fleet Transaction"), and completed an issuer
tender offer for an aggregate of approximately $850 million of Class A Common
Stock, Class B Common Stock and Class B Preferred Stock (SAILS) (the "Tender
Offer"). Upon completion of the Fleet Transaction, Messrs. Alter and Rosoff each
received $5.0 million under the terms of the Supplemental Plan and Mr. Hart
received $3.0 million under the Supplemental Plan.
On October 28, 1997, in connection with the Fleet Transaction, the
Company announced that Mr. Hart and Mr. Allhusen were leaving the Company. Upon
their departures from the Company in connection with the Fleet Transaction, all
of the unvested restricted shares granted to each of Messrs. Hart and Allhusen
under their employment agreements with the Company became fully vested.
Pursuant to the arrangements described above, Mr. Allhusen will also receive a
payment of $1.7 million.
Following the closing of the Fleet Transaction, on February 27, 1998, Mr.
Wesselink retired from the Company. Pursuant to the arrangements described
above, Mr. Wesselink will receive a payment of $855,000.
OTHER MATTERS
In connection with his employment by the Company as President in March
1998, Mr. Olafsson entered into an employment agreement with the Company. The
agreement, which is terminable by either party upon 30 days' prior notice to the
other, provides that Mr. Olafsson's annual base compensation will be at least
$595,000 and that he shall be entitled to participate in the AMIP Plans (with a
target bonus of at least 75% of his base salary and a maximum bonus of 200% of
base salary). Pursuant to this agreement, Mr. Olafsson received 200,000 shares
of restricted Class B Common Stock which will vest in equal installments of
50,000 shares on each of the first four anniversaries of his March 1998 start
date. Under the terms of the agreement, Mr. Olafsson also received options to
purchase 100,000 shares of Class B Common Stock at $22.125 per share, the fair
market value of the shares on the date of grant. The restricted stock and
options will immediately vest upon (A) the termination of Mr. Olafsson's
employment for any reason other than (i) by the Company for "Cause" (as defined
in the agreement) or (ii) by Mr. Olafsson's voluntary departure, (B) in event of
a "change of control" (as defined in the agreement) or (C) Mr. Olafsson's
termination of employment for "Good Reason" (as defined in the agreement).
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In January 1996, Mr. Rosoff and the Company entered into an agreement under
which Mr. Rosoff's annual base salary is a minimum of $475,000. He is entitled
to receive a guaranteed cash bonus which, together with his base salary, will
bring his annual cash compensation to not less than $750,000. He is also
entitled to participate in AMIP III and AMIP IV (with a target bonus of at least
75% of his base salary) and is guaranteed that his total annual compensation
from base salary, guaranteed cash bonus and AMIP award will be at least $1
million. In anticipation of his execution of the agreement, the Company paid him
a one time signing bonus of $950,000 in December 1995. In addition, pursuant to
this agreement he received 100,000 restricted shares of Class B Common Stock and
an option to purchase 50,000 shares of Class B Common Stock at $34.00 per share,
the fair market value of the shares on the date of grant. The restricted shares,
which as of the January 1996 date of grant had a market value of $34.00 per
share, originally were to vest at the rate of 25% per annum over four years,
with the first two installments having vested on January 15, 1997 and 1998, and
the options become exercisable in the same installments one day later. Should
Mr. Rosoff leave the Company's employ before four years have passed, his
remaining unvested benefits will vest upon his departure except in certain
limited circumstances. In addition, these benefits will vest upon a change of
control of the Company (as defined in the agreement). The Company has agreed
that the 100,000 shares of restricted Class B Common Stock will have a fair
market value sufficient to allow Mr. Rosoff to realize $40 per share net after
applicable taxes resulting from an assumed sale of such shares on January 15,
2000, and it will make non-interest bearing loans to him in the interim
sufficient to pay his taxes arising from his receipt of the shares. At April 30,
1998, the aggregate amount outstanding on these loans was $401,807, which was
the largest aggregate amount outstanding at any time since January 1, 1997. If
the net after tax proceeds of such assumed sale are less than $40, loans will be
canceled and a payment will be made in cash and/or Class B Common Stock to Mr.
Rosoff to make up the shortfall.
In connection with the Tender Offer, the Company purchased 49,359 of Mr.
Rosoff's restricted shares at a price of $40.00 per share (subject to the
agreements regarding the after-tax value of these shares to Mr. Rosoff described
above). Also, the Company removed the restrictions on the remaining 641 of his
restricted shares that were not purchased in the Tender Offer and such shares
were returned to Mr. Rosoff as fully vested shares. The Company is obligated to
reimburse Mr. Rosoff for any taxes arising from the sale of his shares in the
Tender Offer and on the reimbursement to Mr. Rosoff for any taxes.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP has been selected by the Board of Directors as the
independent public accountants for the Company's current fiscal year. A
representative of Arthur Andersen LLP is expected to be present at the Meeting
and will have the opportunity to make a statement if he desires to do so and
will be available to respond to appropriate questions of stockholders.
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the Annual Meeting of
Stockholders in 1999 must be received by January 15, 1999, in order to be
considered for inclusion in the Company's proxy materials relating to that
meeting. Stockholder proposals should be directed to Elizabeth H. Mai,
Secretary, at the address of the Company set forth on the first page of this
proxy statement.
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ANNUAL REPORT ON FORM 10-K
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON SOLICITED BY THIS
PROXY STATEMENT, ON THE WRITTEN REQUEST OF SUCH PERSON, A COPY OF THE COMPANY'S
ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES
THERETO, AS FILED WITH THE SEC FOR ITS MOST RECENT FISCAL YEAR. SUCH WRITTEN
REQUEST SHOULD BE DIRECTED TO INVESTOR RELATIONS, AT THE ADDRESS OF THE COMPANY
APPEARING ON THE FIRST PAGE OF THIS PROXY STATEMENT.
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[RECYCLE LOGO]
This proxy statement has been printed entirely on recycled paper.
<PAGE> 27
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ADVANTA CORP.
The undersigned, a stockholder of Advanta Corp. (the "Company"),
hereby constitutes and appoints Dennis Alter, William A. Rosoff, Olaf Olafsson
and Elizabeth H. Mai, and each of them acting individually as the attorney and
special proxy of the undersigned, with full power of substitution, for and in
the name and stead of the undersigned to attend the Annual Meeting of
Stockholders of Advanta Corp. to be held on Thursday, June 4, 1998, at 1:00 p.m.
at the Company's headquarters, Welsh and McKean Roads, Spring House,
Pennsylvania, and any adjournment or postponement thereof, and thereat to vote
all shares which the undersigned would be entitled to cast if personally present
as follows:
(CONTINUED, AND TO BE SIGNED ON THE REVERSE SIDE)
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<PAGE> 28
Please mark
[X] your votes
as this
1. ELECTION OF DIRECTORS
FOR WITHHOLD AUTHORITY
all five nominees for to vote for all five nominees
director listed below for director listed below
[ ] [ ]
INSTRUCTION: To withhold authority to vote for any individual nominee, strike a
line through the nominee's name in the list below.
NOMINEES: Dennis Alter, Arthur P. Bellis, William C. Dunkelberg, Dana Becker
Dunn and Robert C. Hall.
2. To transact such other business as may properly come before the meeting.
IF NOT OTHERWISE SPECIFIED, THE SHARES WILL BE VOTED FOR THE ELECTION OF ALL
FIVE NOMINEES FOR DIRECTOR. This proxy delegates authority to vote with
respect to all other matters upon which the undersigned is entitled to vote and
which may come before the meeting or any adjournment or postponement thereof.
The undersigned hereby revokes all previous proxies for such meeting and hereby
acknowledges receipt of the notice of the meeting and the proxy statement of
Advanta Corp. furnished herewith.
PLEASE SIGN AND MAIL PROMPTLY.
Stockholder's Signature(s) Date 1998
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NOTE: If shares are registered in more than one name, all owners should sign.
If signing in a fiduciary or representative capacity, please give full
title and attach evidence of authority. If a corporation, please sign with full
corporate name by a duly authorized officer and affix the corporate seal.
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-- FOLD AND DETACH HERE --
