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 ss.240.14a-11(c) or ss.240.14a-12
AUDITS & SURVEYS WORLDWIDE, INC.
------------------------------------------------
(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)(1)
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>
AUDITS & SURVEYS WORLDWIDE, INC.
650 Avenue of the Americas
New York, New York 10011
NOTICE OF
ANNUAL MEETING
AND
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JUNE 12, 1997
<PAGE>
AUDITS & SURVEYS WORLDWIDE, INC.
650 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10011
(212) 627-9700
-------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 12, 1997
-------------------
To the Stockholders of
Audits & Surveys Worldwide, Inc.:
Notice is Hereby Given that the Annual Meeting of the Stockholders of
Audits & Surveys Worldwide, Inc., a Delaware corporation (the "Company"), will
be held at The Chase Manhattan Bank, N.A., 11th Floor, 270 Park Avenue (at 48th
Street), New York, New York 10017, on Thursday, June 12, 1997 at 10:00 a.m.
local time, for the following purposes:
1. To elect 11 directors to the Company's Board of Directors
to serve until the Company's next Annual Meeting of
Stockholders following their election or until their
successors are duly elected and qualified;
2. To consider and vote upon the adoption of the 1997 Stock
Option Plan of the Company;
3. To ratify the appointment of Deloitte & Touche LLP as
independent public accountants to audit the Company's
consolidated financial statements for 1997; and
4. To transact such other business as may properly come
before the Annual Meeting and any adjournments thereof.
The stock transfer books of the Company will not be closed but only
stockholders of record at the close of business on April 18, 1997 will be
entitled to notice of and to vote at such meeting or any adjournments or
postponements thereof. A complete list of the stockholders entitled to vote will
be available for inspection by any stockholder during the meeting; in addition,
the list will be open for examination by any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
10 days prior to the meeting, at the offices of Audits & Surveys Worldwide,
Inc., 650 Avenue of the Americas, New York, New York 10011.
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING, PLEASE MARK,
SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED PRE-ADDRESSED
ENVELOPE AS PROMPTLY AS POSSIBLE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES.
By Order of the Board of Directors
Joel S. Klein
Secretary
New York, New York
Date: May 6, 1997
THIS IS AN IMPORTANT MEETING AND ALL STOCKHOLDERS ARE INVITED TO ATTEND THE
MEETING IN PERSON. THOSE STOCKHOLDERS WHO ARE UNABLE TO ATTEND ARE RESPECTFULLY
URGED TO EXECUTE AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE. A
RETURN ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES IS
ENCLOSED FOR YOUR CONVENIENCE. STOCKHOLDERS WHO EXECUTE A PROXY CARD MAY
NEVERTHELESS ATTEND THE MEETING, REVOKE THEIR PROXY AND VOTE THEIR SHARES IN
PERSON.
<PAGE>
AUDITS & SURVEYS WORLDWIDE, INC.
650 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10011
(212) 627-9700
-------------------
PROXY STATEMENT
-------------------
ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is furnished to stockholders of Audits & Surveys
Worldwide, Inc., a Delaware corporation (the "Company"), in connection with the
solicitation of proxies by the Board of Directors for use at the Annual Meeting
of Stockholders (the "Annual Meeting"), to be held at The Chase Manhattan Bank,
N.A., 11th Floor, 270 Park Avenue (at 48th Street), New York, New York 10017, on
Thursday, June 12, 1997 at 10:00 a.m. local time, or any adjournments or
postponements thereof, for the purposes set forth in the accompanying Notice of
Annual Meeting.
The mailing of this Proxy Statement and the enclosed proxy to
stockholders will begin on or about May 6, 1997. Stockholders should review the
information provided herein in conjunction with the Company's Annual Report to
Stockholders for the year ended December 31, 1996 which accompanies this Proxy
Statement.
INFORMATION CONCERNING PROXY
The enclosed proxy is solicited on behalf of the Company's Board of
Directors. The giving of a proxy does not preclude the right to vote in person
should you so desire. You may revoke or change your proxy at any time prior to
its use at the meeting by giving the Company a written direction to revoke your
proxy, giving the Company a new proxy or attending the meeting and voting in
person. Any writing intended to revoke a proxy should be sent to the Company at
its principal executive offices, 650 Avenue of the Americas, New York, New York
10011, attention Joel S. Klein, Secretary.
The cost of preparing, assembling and mailing this Proxy Statement,
the Notice of Annual Meeting of Stockholders and the enclosed proxy will be
borne by the Company. In addition to the use of mail, employees of the Company
may solicit proxies personally and by telephone. The Company's employees will
receive no compensation for soliciting proxies other than their regular
salaries. The Company may request banks, brokers and other custodians, nominees
and fiduciaries to forward copies of the proxy material to their principals and
to request authority for the execution of proxies. The Company will reimburse
such persons for their reasonable out-of-pocket expenses in so doing.
<PAGE>
PURPOSES OF THE MEETING
At the Annual Meeting, the Company's stockholders will consider and
vote upon the following matters:
(1) the election of 11 directors to the Company's Board of
Directors to serve until the Company's next Annual Meeting
of Stockholders following their election or until their
successors are duly elected and qualified;
(2) the adoption of the 1997 Stock Option Plan of the
Company (the "Option Plan"); and
(3) the ratification of the appointment of Deloitte &
Touche LLP as independent public accountants to audit the
Company's consolidated financial statements for 1997.
You are requested to mark, sign and date the accompanying proxy and
return it promptly in the enclosed pre-addressed envelope. Proxies duly executed
and received in time for the Annual Meeting will be voted at the meeting in
accordance with the instructions indicated. Where no instructions are indicated,
proxies will be voted for the nominees for director set forth herein, to adopt
the Option Plan and to ratify the appointment of Deloitte & Touche LLP. Proxies
will also be voted FOR or AGAINST such other business as may properly come
before the Annual Meeting in the discretion of the persons named in the proxy.
OUTSTANDING VOTING SECURITIES AND VOTING RIGHTS
The Board of Directors has set the close of business on April 18,
1997 as the record date (the "Record Date") for the determination of
stockholders of the Company entitled to notice of and to vote at the Annual
Meeting. As of April 18, 1997 there were issued and outstanding 13,099,771
shares of Common Stock. Each share of Common Stock outstanding on the Record
Date is entitled to one vote on each matter submitted to stockholders for
approval at the Annual Meeting.
The presence, in person or by proxy, of the holders of a majority of
the outstanding shares of Common Stock entitled to vote at the Annual Meeting is
necessary to constitute a quorum. Under applicable Delaware law, abstentions and
broker non-votes will not have the effect of votes in opposition to the election
of a director but abstentions will have the effect of votes in opposition to the
adoption of the Option Plan and the ratification of auditors. A plurality of the
votes of the shares present in person or represented by proxy at the Annual
Meeting is required with respect to the election of directors. The affirmative
votes of the holders of a majority of the shares present and voting at the
Annual Meeting is required for the adoption of the resolution authorizing and
approving the Option Plan and for the ratification of the appointment of
independent auditors.
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<PAGE>
OWNERSHIP OF VOTING SECURITIES
The following table sets forth, as of April 18, 1997, information
with respect to the beneficial ownership of the Company's Common Stock by (i)
each person known by the Company to beneficially own more than 5% of the
outstanding shares of Common Stock, (ii) each director of the Company, (iii)
each of the Named Executive Officers (as such term is hereinafter defined) and
(iv) all directors and executive officers of the Company as a group.
AMOUNT AND
NATURE OF PERCENT OF
NAME AND ADDRESS BENEFICIAL OUTSTANDING
OF BENEFICIAL OWNER (1) OWNERSHIP (2) SHARES
----------------------- ------------- -----------
Solomon Dutka 5,159,085(3) 39.33%
2600 Netherland Avenue
Riverdale, New York 10463
Carl Ravitch 1,535,380 11.71%
2602 Woodsview Drive
Bensalem, Pennsylvania 19020
Marilyn Roshwalb 813,664(4) 6.21%
9 Sycamore Drive
Great Neck, New York 11024
H. Arthur Bellows, Jr 650,570(5) 4.96%
15 Upper Cross Road
Greenwich, Connecticut 06831
Joel S. Klein 170,203 1.30%
Joseph T. Plummer 5,500 *
Alan J. Ritter 10,593(6) *
Charles E. Bradley 7,969(7) *
Brian G. Dyson 0
Matthew Goldstein 2,000 *
Robert C. Miller 1,667 *
William Newman 1,000 *
Sol Young 1,000 *
William A. Zebedee 2,574 *
All directors and executive 7,547,541 57.42%
officers as a group (13 persons)
* Less than 1%.
(1) Pursuant to the rules of the Securities and Exchange Commission (the
"SEC"), addresses are only given for holders of 5% or more of the
outstanding Common Stock of the Company.
(2) Unless otherwise indicated, each person or group has sole voting and
investment power with respect to such shares. For purposes of this table,
a person or group of persons is deemed to have "beneficial ownership" of
any shares which such person or group has the right to acquire within 60
days of April 18, 1997. For purposes of computing the percent of
outstanding shares held by each person or group named above as of a given
date, any shares which such person or group has the right to so acquire
are deemed to be outstanding, but are not deemed to be outstanding for
purpose of computing the percentage owned by any other person or group.
Includes options to purchase the Company's common stock which are
currently exercisable as follows: Messrs. Dutka 16,667; Ravitch 6,667;
Bellows 6,667; Klein 8,333; Ritter 3,333; Miller 1,667; Zebedee 1,667; all
directors and executive officers as a group 45,001.
-3-
<PAGE>
(3) Includes an aggregate of 281,513 shares of Common Stock held in a trust
for the benefit of Dr. Dutka's wife, as to which shares Dr. Dutka
disclaims beneficial ownership. An additional 563,026 shares of Common
Stock previously held by trusts for the benefit of Dr. Dutka's sons have
been distributed to the beneficiaries of such trusts and, accordingly, are
no longer included among the shares held by Dr. Dutka.
(4) Includes an aggregate of 400,000 shares held by the Irving Roshwalb Trust
of which Marilyn Roshwalb is a trustee and sole beneficiary. The
information as to these holdings has been derived from a Schedule 13D
dated March 31, 1995 filed by Marilyn Roshwalb.
(5) Includes 76,200 shares owned by Mr. Bellows' wife and children, as to
which shares Mr. Bellows disclaims beneficial ownership.
(6) Includes 7,260 shares owned by Mr. Ritter's children, as to which shares
Mr. Ritter disclaims beneficial ownership.
(7) Includes 2,656 shares owned by Mr. Bradley's wife, as to which shares Mr.
Bradley disclaims beneficial ownership.
ELECTION OF DIRECTORS
The proxy will be voted (unless such vote is withheld) in favor of
the election of the persons named below, as directors, each to hold office for a
term of one year or until the next Annual Meeting, or until another is chosen in
his stead. In the event that any of said nominees does not remain a candidate at
the time of the Annual Meeting (a situation which the Board of Directors does
not now anticipate), the proxy solicited hereunder will be voted in favor of
those nominees who do remain as candidates and may be voted for substitute
nominees.
NAME, AGE AND OTHER
POSITIONS, IF ANY, WITH THE PERIOD SERVED AS DIRECTOR AND BUSINESS
COMPANY EXPERIENCE DURING PAST 5 YEARS
- --------------------------- --------------------------------------
Solomon Dutka 73 Served as a director, Chairman and Chief
Chairman and Chief Executive Executive Officer of the Company since March
Officer 1995. A founder of Audits and Surveys, Inc.
("A&S") in 1953, he served A&S in various
capacities, including as its Chairman and
President, prior to its merger with The
Triangle Corporation ("Triangle") in March
1995.
H. Arthur Bellows, Jr. 59 Served as a director, President and Chief
President and Chief Operating Operating Officer of the Company since March
Officer 1995. He served as a director and Chairman of
Triangle from August 1967 until its merger with
A&S in March 1995 and as Triangle's President
from October 1971 until March 1995. Also served
as a director of United Video Satellite Group,
Inc. and Scott Cable Communications, Inc. until
January 25, 1996 and February 12, 1996,
respectively.
-4-
<PAGE>
NAME, AGE AND OTHER
POSITIONS, IF ANY, WITH THE PERIOD SERVED AS DIRECTOR AND BUSINESS
COMPANY EXPERIENCE DURING PAST 5 YEARS
- --------------------------- --------------------------------------
Joseph T. Plummer 56 Served as Vice Chairman of the Company since
Vice Chairman August 1996. From March 1989 to August 1996 he
was with the advertising agency of DMB&B,
serving as its Vice Chairman and Worldwide
Planning Director. From March 1979 to March
1989 he was with Young & Rubicam where he
served as its Worldwide Research Director.
Carl Ravitch 55 Served as a director and Executive Vice
Executive Vice President President of the Company since March 1995. He
joined A&S in 1967 and served as its Executive
Vice President - Chief Marketing Officer from
1992 until the merger with Triangle in March
1995.
Charles E. Bradley 67 Served as a director of the Company since March
1995. He served as a director of Triangle from
1967 to March 1995. President of Stanwich
Partners, Inc. (a private investment banking
firm). Also serves as a director of General
Housewares Corp., Zydeco, Consumer Portfolio
Services, Reunion Industries Inc., De
Vlieg-Bullard, Inc., Texon Energy Corp., NAB
Asset Corp. and Sanitas, Inc.
Brian G. Dyson 61 Served as a director of the company since May
1995. President of Chatham International Corp.
since December 1993 and Senior consultant to
The Coca-Cola Company since 1992. Prior to
1992, Mr. Dyson was President and CEO of
Coca-Cola Enterprises, Inc. and held various
other executive level position swith The
Coca-Cola Company.
Matthew Goldstein 55 Served as a director of the Company since March
1995. President of Bernard M. Baruch College
since 1991. Prior to such appointment, Mr.
Goldstein served as Acting Vice Chancellor for
Academic Affairs for the City University of New
York and President of The City of New York's
Research Foundation. Also serves as a director
of Health-Chem Corporation and Bronx-Lebanon
Hospital.
Robert C. Miller 31 Served as a director of the Company since March
1995. Vice President and Director of the
investment banking firm of Allen & Company
Incorporated and has been associated with the
firm since 1986. Also serves as a director of
Envirogen, Inc. (a public environmental
company), Mediscience Technology Corporation (a
public medical technology company) and Applied
Imaging Corp. (a public medical technology
company), as well as a director of several
privately-held companies in which Allen &
Company Incorporated has an investment.
-5-
<PAGE>
NAME, AGE AND OTHER
POSITIONS, IF ANY, WITH THE PERIOD SERVED AS DIRECTOR AND BUSINESS
COMPANY EXPERIENCE DURING PAST 5 YEARS
- --------------------------- --------------------------------------
William Newman 70 Served as a director of the Company since March
1995. Chief Executive Officer and Chairman of
New Plan Realty Trust (a New York Stock
Exchange listed real estate investment trust)
since 1972.
Sol Young 74 Served as a director of the Company since March
1995. President of ZY Hampton Corporation (a
real estate corporation) since 1986.
William A. Zebedee 60 Served as a director of the Company since March
1995. He served as a director of Triangle from
1986 to March 1995. President of MICA
Resources, Ltd. (aluminum sales and recycling)
since 1988.
Under the terms of a stockholder's agreement dated March 24, 1995,
the then stockholders of A&S (who included Messrs. Dutka and Ravitch) agreed,
among other things, to vote their shares of the Company's Common Stock at the
1997 Annual Meeting of Stockholders of the Company for the election of Mr.
Bellows and two persons nominated by him to the Board of Directors of the
Company. Messrs. Bradley and Zebedee are Mr. Bellows' nominees under the
stockholders' agreement.
The Board of Directors unanimously recommends a vote FOR each of the
foregoing nominees for director. Your proxy will be so voted unless you specify
otherwise.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the year ended December 31, 1996, the Board of Directors held
four meetings and took certain actions on three other occasions by written
consent. During 1996, each director attended at least 75% of the total number of
meetings of the Board of Directors and each Committee in which he served, except
Mr. Bradley.
The Board of Directors has established certain Committees to assist
it in the discharge of its responsibilities. The following table identifies the
current members of the Committees.
-6-
<PAGE>
COMPENSATION
AND
EXECUTIVE AUDIT STOCK OPTION NOMINATING
COMMITTEE COMMITTEE COMMITTEE COMMITTEE
--------- --------- --------- ---------
Solomon Dutka X X
H. Arthur Bellows, Jr. X X
Carl Ravitch X
Charles E. Bradley X X
Brian G. Dyson X X
Matthew Goldstein X X X
Robert C. Miller X
William Newman X X X
Sol Young X X X
William A. Zebedee X
The Executive Committee exercises the power of the Board of Directors
during intervals between Board meetings and acts as an advisory body to the
Board of Directors by reviewing various matters prior to their submission to the
Board. The Executive Committee held one meeting during 1996 and its members met
informally from time to time.
The Audit Committee recommends engagement of the independent
auditors, reviews the arrangement and scope of the audit and reviews internal
accounting procedures and controls with the independent auditors and the
Company's financial and accounting staff. The Audit Committee held two meetings
during 1996; in addition, its members met informally from time to time.
-7-
<PAGE>
The Compensation and Stock Option Committee (the "Compensation
Committee") reviews and makes recommendations regarding salaries, compensation
and benefits to be paid to officers and key employees of the Company as well as
reviewing and making recommendations regarding the benefit programs of the
Company as a whole. In addition, this Committee reviews and makes
recommendations regarding stock options to be granted to employees, directors
and consultants. The Compensation Committee held one meeting during 1996; in
addition, its members met informally from time to time.
The Nominating Committee considers and nominates persons for election
to the Board. The Nominating Committee did not hold any formal meetings during
1996, however, its members met informally from time to time.
SECTION 16(A) REPORTING
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") requires the Company's executive officers and directors, and
persons who beneficially own more than 10% of the Company's Common Stock, to
file initial reports of ownership and reports of changes of ownership with the
SEC and furnish copies of those reports to the Company. Based solely on a review
of the copies of the reports furnished to the Company to date, or written
representations that no reports were required, the Company believes that all
reports required to be filed by such persons with respect to the Company's
fiscal year ended December 31, 1996 were timely made, except that Messrs.
Matthew Goldstein, Carl Ravitch and Sol Young each failed to timely file one
Statement of Changes in Beneficial Ownership on Form 4 with regard to one
transaction and Dr. Solomon Dutka failed to timely file five Statements of
Changes in Beneficial Ownership on Form 4 with regard to nine transactions. All
of the transactions not timely reported were open market purchases. All of such
late reports have been filed.
EXECUTIVE COMPENSATION
The following table sets forth information concerning annual and
long-term compensation, paid or accrued, for the Chief Executive Officer and the
four other most highly compensated executive officers of the Company (the "Named
Executive Officers") for services in all capacities to the Company and its
subsidiaries during the last three fiscal years.
-8-
<PAGE>
SUMMARY COMPENSATION TABLE (1)
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
------------------- ------------
OTHER NUMBER OF
ANNUAL SECURITIES ALL OTHER
COMPENSATION UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS (2) (3) (4) OPTIONS (5) (6)
--------------------------- ---- ------ ----- ----------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Solomon Dutka 1996 $350,000 $152,641 -- 50,000 $ 750
Chairman of the Board of Directors 1995 $350,000 -- -- -- $ 1,278
and Chief Executive Officer(7) 1994 $150,000 $498,084 -- -- $ 1,916
H. Arthur Bellows, Jr 1996 $300,000 $122,504 -- 20,000 $ 750
President - Chief Operating 1995 $301,250 -- $ 45,187 -- $545,000
Officer (8) 1994 $305,000 -- $ 54,016 -- $ 1,559
Carl Ravitch 1996 $250,000 $102,608 -- 20,000 $ 750
Executive Vice President - Marketing 1995 $250,000 -- -- -- $ 1,271
1994 $100,000 $129,640 -- -- $ 1,531
Joel S. Klein 1996 $203,846 $ 77,623 -- 25,000 $ 750
Executive Vice President - Operations 1995 $125,000 -- -- -- $ 1,274
and Secretary 1994 $ 77,308 $382,926 -- -- $ 1,347
Alan J. Ritter 1996 $120,000 $ 42,503 -- 10,000 $ 750
Senior Vice President, Treasurer and 1995 $111,333 -- $ 4,711 -- --
Chief Financial Officer (9) 1994 $107,000 -- $ 8,774 -- $ 1,190
</TABLE>
(1) Includes, as appropriate, compensation paid to the Named Executive
Officers by the Company (since March 24, 1995) and A&S and Triangle
(during 1994 and from January 1, 1995 to March 23, 1995). In 1994, 1995
and 1996 none of the Named Executive Officers received perquisites or
other personal benefits in excess of the lesser of $50,000 or 10% of the
total of his salary and bonus for that year, as reported in this table.
(2) The amounts shown include premiums for whole life insurance paid by
Triangle on behalf of Messrs. Bellows and Ritter for the years 1995 and
1994 respectively, as follows: Mr. Bellows - $15,985 and $17,259; and Mr.
Ritter - $2,354 and $5,650.
(3) The amounts shown include costs to the Company for expenses associated
with the use of Company cars for 1994 as follows: Mr. Bellows - $7,056 and
Mr. Ritter - $1,390.
(4) The amounts shown include premiums for medical reimbursement insurance
paid by the Company on behalf of Messrs. Bellows and Ritter for the years
1995 and 1994, respectively, as follows: Mr. Bellows - $29,202 and $22,907
and Mr. Ritter - $2,357 and $1,734.
(5) Represents contributions to the Named Executive Officer's account under a
401(k) plan, except in the case of Mr. Bellows and Mr. Ritter for 1995.
-9-
<PAGE>
(6) In 1995 Mr. Bellows received a payment of $545,000 from Triangle in
connection with the termination of his employment agreement which gave him
the right to receive both a lump sump payment of $915,000 and certain
insurance coverage estimated to aggregate an additional $75,000 in
payments.
(7) Dr. Dutka served as President of A&S through March 23, 1995.
(8) Mr. Bellows served as Chairman of the Board, President and Chief Executive
Officer of Triangle through March 23, 1995.
(9) Mr. Ritter has served as Senior Vice President, Treasurer and Chief
Financial Officer of the Company since August 1996 and as Chief Accounting
Officer from September 1995. He served as Vice President-Finance of
Triangle through March 1995.
-10-
<PAGE>
STOCK OPTIONS
The following table sets forth information as to all grants of
options to the Named Executive Officers during 1996.
<TABLE>
<CAPTION>
OPTION GRANTS IN 1996 (1)
INDIVIDUAL GRANTS
------------------------------------------------------------- POTENTIAL REALIZABLE
VALUE AT ASSUMED
NUMBER OF % OF ANNUAL RATES OF
SECURITIES TOTAL OPTIONS STOCK PRICE APPRECIATION
UNDERLYING GRANTED TO FOR OPTION TERM (2)
OPTIONS EMPLOYEES EXERCISE EXPIRATION ----------------------
NAME GRANTED(3) IN 1996 PRICE DATE AT 5% AT 10%
---- ---------- ---------- -------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Solomon Dutka 50,000 7.84% $2.00 3/13/2006 $ 63,000 $159,500
H. Arthur Bellows, Jr 20,000 3.14% $2.00 3/13/2006 $ 25,200 $ 63,800
Carl Ravitch 20,000 3.14% $2.00 3/13/2006 $ 25,200 $ 63,800
Joel S. Klein 25,000 3.92% $2.00 3/13/2006 $ 31,500 $ 79,750
Alan J. Ritter 10,000 1.57% $2.00 3/13/2006 $ 12,600 $ 31,900
</TABLE>
- ----------
(1) The Company did not grant any stock appreciation rights during 1996.
(2) The dollar amounts set forth under these columns are the result of
calculations at the 5% and 10% rates established by the SEC and are not
intended to forecast future appreciation of the Company's stock price. The
Company did not use an alternative formula for a grant date valuation as
it is unaware of any formula which would determine with reasonable
accuracy a present value based upon future unknown factors. In order to
realize the potential values set forth under the columns headed " At 5% "
and " At 10% ", the price per share of the Company's Common Stock at the
end of the ten year option term would be $3.26 and $5.19, respectively.
(3) The option was awarded at the fair market value of the Company's Common
Stock at March 14, 1996, the date of the award, and becomes exercisable in
cumulative annual installments of 33 1/3% per year on each of the first
three anniversaries of the grant date. The option is exercisable over a
ten year period.
The following table sets forth information with respect to the
exercise of stock options by the Named Executive Officers during 1996 and
unexercised options held by them on December 31, 1996.
-11-
<PAGE>
AGGREGATED OPTION EXERCISES IN 1996
AND DECEMBER 31, 1996 OPTION VALUES ( 1 )
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT DECEMBER 31, 1996 AT DECEMBER 31, 1996 (2)
---------------------------- ------------------------
SHARES
ACQUIRED VALUE
ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Solomon Dutka -- -- -- 50,000 -- $50,000
H. Arthur Bellows, Jr -- -- -- 20,000 -- $20,000
Carl Ravitch -- -- -- 20,000 -- $20,000
Joel S. Klein -- -- -- 25,000 -- $25,000
Alan J. Ritter -- -- -- 10,000 -- $10,000
</TABLE>
- ---------
(1) There were no stock appreciation right exercises during 1996 and no such
rights were outstanding at December 31, 1996.
(2) The closing price of the Company's Common Stock as reported on the
American Stock Exchange (the "AMEX") on December 31, 1996 was $3.00 per
share. Value is calculated by multiplying ( a ) the difference between the
closing price and the option price by ( b ) the number of shares of Common
Stock underlying the option.
-12-
<PAGE>
RETIREMENT AND OTHER BENEFIT PLANS
Prior to the merger of Triangle and A&S, Triangle maintained a
pension plan (the "Triangle Plan"). On March 17, 1995 Triangle amended the
Triangle Plan. As a result of such amendment, employees of A&S could not
participate therein; Mr. Bellows and Mr. Ritter were, however, entitled to
receive benefits under such plan. Under the Triangle Plan pension benefits at
age 65, for employees with 30 years of service, are calculated at 50% of Final
Average Earnings (the five highest consecutive base salaries during the last ten
years prior to retirement), less 50% of the employee's Primary Social Security
Benefit. For service of less than 30 years, the amount of the pension is reduced
proportionately. For retirement prior to age 65, the pension payment is reduced
actuarially.
Effective January 1, 1997, the Triangle Plan was amended to, among
other things, ( i ) change the name of the plan to the Audits & Surveys
Worldwide, Inc. Account Balance Retirement Plan, ( ii ) include all employees of
the Company completing one year of service and ( iii ) establish participant
accounts which shall be credited each year with an amount equal to one and one
half percent of the participant's plan compensation (as defined) and interest on
the account balance at the rate applicable to 30 year U.S. Treasury securities.
Benefit accruals under the Triangle plan were frozen as of June 30,
1996. Accordingly, benefit amounts payable at age 65 to Mr. Bellows and Mr.
Ritter were calculated as of June 30,1996 as a function of average compensation,
credited service and Social Security benefits. In order to establish opening
account balances as of January 1, 1997 in the Audits and Surveys Account Balance
Plan, the calculated benefit amounts due pursuant to the Triangle Plan were
equated to lump sum present values of approximately $484,000 for Mr. Bellows and
$127,000 for Mr. Ritter.
DIRECTORS' COMPENSATION
Each director who is not an employee of the Company receives an
annual retainer of $12,000 plus $1,000 for each Board meeting attended and
$1,000 for each committee meeting attended. All directors are reimbursed for
out-of-pocket expenses incurred in connection with attendance at meetings or
other Company business.
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements with each of its
Named Executive Officers except Mr. Klein. The employment agreement with Dr.
Dutka provides that he will be employed for a five-year term through March 24,
2000 at a salary of $350,000 per annum. At any time after March 1998, Dr. Dutka
may elect to terminate his status as a full-time employee and become a
consultant to the Company for the balance of the term of his employment
agreement. In such event, Dr. Dutka would receive a consulting fee for his
services in an amount equal to $175,000 per annum. Effective March 25, 1997, Dr.
Dutka's employment agreement was amended to ( i ) extend the term to March 24,
2002, ( ii ) increase his annual salary to $400,000 and ( iii ) increase future
consulting fees to $200,000 per annum.
The Company's employment agreements with Messrs. Bellows and Ravitch
provide for three-year terms expiring March 24, 1998 at annual salaries of
$300,000 and $250,000, respectively. Effective March 25, 1997, Mr. Bellows' and
Mr. Ravitch's employment agreements were amended to ( i ) extend the terms to
March 24, 2000 and ( ii ) increase Mr. Bellows' annual salary to $350,000 and
Mr. Ravitch's annual salary to $300,000. Mr. Ritter's employment agreement with
the Company provides for his employment for a three-year term through September
1998 at a salary of $120,000 per annum.
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COMPENSATION AND STOCK OPTION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Sol Young, Charles E. Bradley, Brian G. Dyson and William
Newman served as members of the Compensation Committee during 1996 and Matthew
Goldstein served as a member of said committee since June 1996. No member of the
Compensation Committee (i) was, during 1996, an officer or employee of the
Company or any of its subsidiaries, (ii) was formerly an officer of the Company
or any of its subsidiaries or (iii) had any relationship requiring disclosure by
the Company pursuant to any paragraph of Item 404 of Regulation S-K promulgated
by the SEC.
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, and the
Exchange Act that might incorporate future filings, including this Proxy
Statement, in whole or in part, the following report and the performance graph
on page 16 shall not be incorporated by reference to any such filings.
COMPENSATION AND STOCK OPTION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee is presently composed of Messrs. Sol
Young, Charles E. Bradley, Brian G. Dyson, Matthew Goldstein and William Newman.
The Compensation Committee makes all decisions relating to the compensation and
granting of stock options for the executive officers of the Company.
It is the philosophy of the Compensation Committee that compensation
of executive officers should be closely aligned with the financial performance
of the Company. This is particularly true since all but one of the Named
Executive Officers has an employment agreement with the Company. Accordingly,
benefits are provided through stock option incentives and bonuses which are
generally consistent with the goal of coordinating the rewards to management
with a maximization of stockholder return. In reviewing Company performance,
consideration is given to the Company's earnings. Also taken into account are
external economic factors that affect results of operations. An attempt is also
made to maintain compensation within the range of that afforded like executive
officers at companies whose size and business is comparable to that of the
Company. In order to provide incentives to executive officers of the Company,
from time to time in 1996 the Committee granted options to purchase 175,000
shares of stock to executive officers. Based on the significant improvement in
the Company's 1996 operating performance, financial results and condition, the
Compensation Committee granted bonuses to the executive officers aggregating
$485,000.
CEO COMPENSATION
In the case of the Chief Executive Officer, the Compensation
Committee evaluates the Company's mid and long range strategic planning and its
implementation as well as the considerations impacting the compensation of
executive officers generally which are described above. In order to provide
incentives to Dr. Dutka, during 1996 the Committee granted him options to
purchase 50,000 shares of stock.. Based on the significant improvement in the
Company's 1996 operating performance, financial results and condition, the
Compensation Committee granted Dr. Dutka a bonus of $150,000.
EXECUTIVE PAY DEDUCTION LIMITATION
The Compensation Committee has not yet developed a policy with
respect to amending pay policies or asking stockholders to vote on "pay for
performance" plans in order to qualify compensation in excess of $1 million a
year which might be paid to the five highest paid executives for federal tax
deductibility. The
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Compensation Committee intends to continue to monitor this matter and will
balance the interests of the Company in maintaining flexible incentive plans
against the possible loss of a tax deduction should taxable compensation for any
of the five highest paid executives exceed $1 million in future years.
The foregoing report is approved by all members of the Compensation
Committee.
Sol Young
Charles E. Bradley
Brian G. Dyson
Matthew Goldstein
William Newman
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PERFORMANCE GRAPH
Set forth below is a graph comparing the yearly change in the
cumulative stockholder return on the Company's Common Stock, the Amex Market
Value Index, a peer group selected by the Company and the NASDAQ 100 Index. The
graph assumes $100 invested on December 31, 1991 in Triangle's Common Stock and
in each of the indices and that all dividends on stocks included in the two
indices and in the stock of the peer group were reinvested. No cash dividends
were paid on the Common Stock of Triangle or the Company during the five year
period ended December 31, 1996. The peer group consists of the Company and five
other companies in the market research industry: Market Facts, Inc., M/A/R/C,
Inc., NFO Research, Inc., Opinion Research Corporation and Total Research
Corporation during the period that their stock was publicly traded. The returns
of each component company in the peer group have been weighted based on such
company's relative market capitalization. The stockholder return shown on the
graph below is not necessarily indicative of future performance.
AUDITS & SURVEYS WORLDWIDE, INC.
- --------------------------------------------------------------------------------
[GRAPH TO BE INSERTED HERE. HARD COPY FORWARDED TO THE
SECURITIES AND EXCHANGE COMMISSION.]
- --------------------------------------------------------------------------------
COMPARISON OF CUMULATIVE TOTAL SHAREHOLDER RETURNS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
12/31/91 12/31/92 12/31/93 12/31/94 12/31/95 12/31/96
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Audits & Surveys Worldwide Inc. $100 $60 $25 $108 $54 $102
Peer Group $100 $69 $81 $95 $146 $201
Amex Market Value Index $100 $101 $121 $110 $139 $148
Nasdaq 100 Index $100 $137 $181 $213 $349 $574
- -------------------------------------------------------------------------------------------------------
</TABLE>
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ADOPTION OF THE 1997 STOCK OPTION PLAN
On March 12, 1997, the Board of Directors adopted the Company's 1997
Stock Option Plan (the "Option Plan"), a copy of which is set forth as Exhibit A
to this Proxy Statement. The Option Plan is designed to provide an incentive to
key employees (including directors and officers who are key employees), and to
consultants, advisors and directors who are not employees, of the Company and
its present and future subsidiaries and to offer an additional inducement in
obtaining the services of such individuals.
The approval of the Option Plan will require the affirmative vote of
the holders of a majority of the shares present in person or by proxy at the
Annual Meeting. If the Option Plan is not approved by stockholders, the Option
Plan will terminate. The Board of Directors recommends a vote FOR approval of
the Option Plan.
The following summary of certain material features of the Option Plan
does not purport to be complete and is qualified in its entirety by reference to
the text of the Option Plan set forth as Exhibit A to this Proxy Statement..
SHARES SUBJECT TO THE OPTION PLAN
The maximum number of shares of Common Stock, $.01 par value per
share, of the Company ("Common Stock") as to which options may be granted under
the Option Plan (subject to adjustment as described below) is 1,000,000 shares
of Common Stock. Upon expiration, cancellation or termination of unexercised
options, the shares of Common Stock subject to such options will again be
available for the grant of options under the Option Plan. No options have been
granted to date under the Option Plan and no determination has been made as to
the number of options covered by the Option Plan to be granted to any Named
Executive Officer or to current executive officers, employees or consultants.
The closing market price of one share of Common Stock as of April 18,
1997 on the AMEX was $2.63.
TYPE OF OPTIONS
Options granted under the Option Plan may either be incentive stock
options ("ISOs"), within the meaning of Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code") or nonqualified stock options ("NQSOs"), which
do not meet the requirements of Section 422 of the Code.
ADMINISTRATION
The Option Plan shall be administered by a committee of the Board of
Directors (the "Committee") consisting of not less than two directors. During
such time as the Company has a class of equity securities registered under
Section 12 of the Exchange Act, each member of the Committee shall be a
"non-employee director" within the meaning of Rule 16b-3 (as the same may be in
effect and interpreted from time to time, "Rule 16b-3"). A majority of the
members of the Committee shall constitute a quorum, and the acts of a majority
of the members present at any meeting at which a quorum is present, and any acts
approved in writing by all members without a meeting, shall be the acts of the
Committee. The Option Plan also contemplates that each member of the Committee
will be an "outside director" within the meaning of Section 162(m) of the Code.
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ELIGIBILITY
The Committee may from time to time, consistent with the purposes of
the Option Plan, grant (a) options to key employees (including officers and
directors who are key employees) of the Company or any of its subsidiaries
("Employee Options"), (b) options to consultants and advisors of the Company or
any of its subsidiaries who are not common law employees of the Company or any
of its subsidiaries ("Consultant Options") and (c) options to directors of the
Company who at the time of grant are not common law employees of the Company or
of any of its subsidiaries ("Outside Director Options").
OPTION CONTRACTS
Each option is evidenced by a written contract between the Company
and the optionee, containing such terms and conditions not inconsistent with the
Option Plan as may be determined by the Committee (the "Contract").
TERMS AND CONDITIONS OF OPTIONS
Options granted under the Option Plan are subject to, among other
things, the following terms and conditions:
(a) The exercise price of each option is determined by the
Committee; provided, however, that the exercise price of
an ISO may not be less than the fair market value of
Common Stock subject to such option on the date of grant
(110% of such fair market value if the optionee owns (or
is deemed to own) more than 10% of the voting power of the
Company).
(b) Options may be granted for terms determined by the
Committee; provided, however, that the term of an ISO may
not exceed 10 years (5 years if the optionee owns (or is
deemed to own) more than 10% of the voting power of the
Company).
(c) The maximum number of shares of Common Stock for which
options may be granted to an employee in any calendar year
is 250,000. In addition, the aggregate fair market value
of shares with respect to which ISOs may be granted to an
employee which are exercisable for the first time during
any calendar year may not exceed $100,000.
(d) Each option is payable in full upon exercise or, if the
applicable Contract permits, in installments. Payment of
the exercise price of an option may be made in cash, or,
if the applicable Contract permits, in shares of Common
Stock or any combination thereof.
(e) Options may not be transferred other than by will or by
the laws of descent and distribution, and may be exercised
during the optionee's lifetime only by him or her or his
or her legal representative.
(f) Except as may otherwise be provided in the applicable
Contract, in the case of an Employee Option, if the
optionee's employment with the Company is terminated for
any reason other than death or disability, the option may
be exercised, to the extent exercisable by the optionee at
the time of termination of employment, within three months
thereafter, but in no event after the expiration of the
term of the option. However, if such employment is
terminated either for cause or without the consent of the
Company, such option will terminate immediately. In the
case of the death of the optionee while employed (or,
generally, within three months after termination
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of employment, or within one year after termination of
employment by reason of disability), his or her legal
representative or beneficiary may exercise the option, to
the extent exercisable on the date of the death, within
one year after such date, but in no event after the
expiration of the term of the option. An optionee whose
employment is terminated by reason of his or her
disability may exercise the option, to the extent
exercisable at the time of such termination, within one
year thereafter, but not after the expiration of the term
of the option.
(g) Except as may otherwise be provided in the applicable
Contract, in the case of a Consultant Option, if the
optionee's consulting or advisory relationship with the
Company is terminated for any reason, the option may be
exercised, to the extent exercisable by the optionee at
the time of such termination, within three months
thereafter, but in no event after the expiration of the
term of the option. However, if such relationship is
terminated either for cause or without the consent of the
Company, such option will terminate immediately. In the
case of the death of the optionee (or a key employee of
the optionee) while engaged as a consultant to the Company
(or, generally within three months after termination of
the optionee's consulting or advisory relationship with
the Company, or within one year after termination of the
optionee's consulting or advisory relationship with the
Company by reason of disability of the optionee or a key
employee of the optionee), his or her legal representative
or beneficiary may exercise the option, to the extent
exercisable on the date of the death, within one year
after such date, but in no event after the expiration of
the term of the option. An optionee whose consulting or
advisory relationship with the Company is terminated by
reason of his or her disability may exercise the option,
to the extent exercisable at the time of such termination,
within one year thereafter, but not after the expiration
of the term of the option.
(h) Except as may otherwise be provided in the applicable
Contract, in the case of an Outside Director Option, if
the optionee's status as a director of the Company
terminates for any reason other than death or disability,
the option may be exercised, to the extent exercisable by
the optionee at the time of such termination, within three
months thereafter, but in no event after expiration of the
term of the option. However, if such status is terminated
for cause, such option will terminate immediately. In the
case of the death of the optionee while serving as a
director (or, generally, within three months after
termination of such relationship or one year after
termination of such relationship by reason of disability),
his or her legal representative or beneficiary may
exercise the option, to the extent exercisable on the date
of death, within one year after such date, but in no event
after the expiration of the term of the option. An
optionee whose status as a director is terminated by
reason of his or her disability may exercise the option,
to the extent exercisable at the time of such termination,
within one year thereafter, but not after the expiration
of the term of the option.
(i) The Company may withhold cash and/or shares of Common
Stock having an aggregate fair market value equal to the
amount which the Company determines is necessary to meet
its obligations to withhold any federal, state and/or
local taxes or other amounts incurred by reason of the
grant or exercise of an option, its disposition or the
disposition of shares acquired upon the exercise of the
option. Alternatively, the Company may require the holder
to pay the Company such amount, in cash, promptly upon
demand.
(j) In the event of (a) the liquidation or dissolution of the
Company, (b) a merger in which the Company is not the
surviving corporation or a consolidation, or (c) any
transaction (or series
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<PAGE>
of related transactions) in which more than 50% of the
outstanding Common Stock is transferred or exchanged for
other consideration, or shares of Common Stock in excess
of the number of shares of Common Stock outstanding
immediately preceding the transaction are issued (other
than to stockholders of the Company with respect to their
shares of stock in the Company), any outstanding options
shall terminate upon the earliest of any such event,
unless other provision is made therefor in the
transaction.
ADJUSTMENT IN EVENT OF CAPITAL CHANGES
In the event of any change in the Common Stock by reason of any stock
dividend, recapitalization, merger in which the Company is the surviving
corporation, spinoff, split-up, combination, exchange of shares or the like,
appropriate adjustments shall be made in the number and kind of shares available
under the Option Plan, in the number and kind of shares subject to each
outstanding option and the exercise prices of such options, and in the
limitation on the number of shares that may be granted to any employee in any
calendar year.
DURATION AND AMENDMENT OF THE OPTION PLAN
No option may be granted pursuant to the Option Plan after March 11,
2007. The Board of Directors may at any time suspend, terminate or amend the
Option Plan; provided, however, that, without the approval of the Company's
stockholders, no amendment may be made which would (a) increase the maximum
number of shares available for the grant of options (except as a result of the
anti-dilution adjustments described above), (b) change the eligibility
requirements for individuals who may receive options or (c) make any change for
which applicable law or regulatory authority requires stockholder approval.
No termination or amendment may adversely affect the rights of an
optionee with respect to an outstanding option without his or her consent.
FEDERAL INCOME TAX TREATMENT
The following is a general summary of the Federal income tax
consequences relating to ISOs and NQSOs under the Option Plan under current law
(including Temporary and Proposed Regulations which may be changed when
finalized). It should be understood that this summary is not exhaustive, that
final regulations have not yet been issued with respect to ISOs, and that
special rules not specifically discussed herein may apply in certain situations.
Optionees should consult with their own tax advisors with respect to the tax
consequences inherent in the ownership and exercise of stock options and the
ownership and disposition of the underlying shares.
ISOs Exercised With Cash
No taxable income will be recognized by an optionee upon the grant or
exercise of an ISO. The optionee's tax basis in the shares acquired upon the
exercise of an ISO with cash will be equal to the exercise price paid by him or
her for such shares.
If the shares received upon exercise of an ISO are disposed of more
than two years from the date of grant of the option and more than one year after
the date of transfer of such shares to the optionee, the optionee will recognize
long-term capital gain or loss on such disposition equal to the difference
between the selling price and the optionee's basis in the shares, and the
Company will not be entitled to a deduction. Long-term capital gain is generally
subject to more favorable tax treatment than short-term capital gain or ordinary
income. Proposed
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<PAGE>
legislation would make such treatment even more favorable. There is no
assurance, however, that such proposed legislation will be enacted.
If the shares received upon the exercise of an ISO are disposed of
prior to the end of the two-years-from-grant/one-year-after-transfer holding
period (a "disqualifying disposition"), the excess, if any, of the fair market
value of the shares on the date of transfer of such shares to the optionee over
the exercise price (but not in excess of the gain realized on the disposition of
the shares) will be taxed as ordinary income in the year of such disposition,
and the Company generally will be entitled to a deduction in the year of
disposition equal to such amount. Any additional gain or any loss recognized by
the optionee on such disposition will be short-term or long-term capital gain or
loss, as the case may be, depending upon the period for which the shares were
held.
NQSOs Exercised With Cash
No taxable income will be recognized by an optionee upon the grant of
an NQSO. Upon the exercise of an NQSO, the excess of the fair market value of
the shares received at the time of exercise over the exercise price therefor
will be taxed as ordinary income, and the Company will generally be entitled to
a corresponding deduction. The optionee's tax basis in the shares acquired upon
the exercise of such NQSO will be equal to the exercise price paid by him or her
for such shares plus the amount of ordinary income required to be recognized.
Any gain or loss recognized by the optionee on a subsequent
disposition of shares purchased pursuant to an NQSO will be short-term or
long-term capital gain or loss, depending upon the period during which such
shares were held, in an amount equal to the difference between the selling price
and the optionee's tax basis in the shares.
Exercises Using Previously Acquired Shares
If previously acquired shares are surrendered in full or partial
payment of the exercise price of an option (whether an ISO or an NQSO), gain or
loss generally will not be recognized by the optionee upon the exercise of such
option to the extent the optionee receives shares ("Replacement Shares") which
on the date of exercise have a fair market value equal to the fair market value
of the shares surrendered in exchange therefor. If the option exercised is an
ISO or if the shares used were acquired pursuant to the exercise of an ISO, the
Replacement Shares are treated as having been acquired pursuant to the exercise
of an ISO.
However, if an ISO is exercised with shares which were previously
acquired pursuant to the exercise of an ISO but which were not held for the
required two-years-from-grant/one-year-after-transfer holding period, there is a
disqualifying disposition of such previously acquired shares. In such case, the
optionee will recognize ordinary income on such disqualifying disposition equal
to the difference between the fair market value of such shares on the date of
exercise of the prior ISO and the amount paid for such shares (but not in excess
of the gain realized). Special rules apply in determining which shares are
considered to have been disposed of and in allocating the basis among the
shares. No capital gain is recognized.
The optionee will have an aggregate basis in the Replacement Shares
equal to the basis of the shares surrendered, increased by any ordinary income
required to be recognized on the disposition of the previously acquired shares.
The optionee's holding period for the Replacement Shares generally includes the
period during which the surrendered shares were held.
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Any shares received by the optionee on such exercise in addition to
the Replacement Shares will be treated in the same manner as a cash exercise of
an option for no consideration.
Alternative Minimum Tax
In addition to the Federal income tax consequences described above,
an optionee who exercises an ISO may be subject to the alternative minimum tax,
which is payable only to the extent it exceeds the optionee's regular tax
liability. For this purpose, upon the exercise of an ISO, the excess of the fair
market value of the shares over the exercise price is an adjustment which
increases the optionee's alternative minimum taxable income. In addition, the
optionee's basis in such shares is increased by such amount for purposes of
computing the gain or loss on disposition of the shares for alternative minimum
tax purposes. If the optionee is required to pay an alternative minimum tax, the
amount of such tax which is attributable to deferral preferences (including the
ISO adjustment) is allowable as a tax credit against the optionee's regular tax
liability (net of other non-refundable credits) in subsequent years. To the
extent the credit is not used, it is carried forward. Holders of ISOs should
consult with their tax advisors concerning the applicability and effect on them
of the alternative minimum tax.
RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors of the Company has appointed, subject to
ratification by the stockholders, Deloitte & Touche LLP as the independent
auditors of the Company and its subsidiaries for the fiscal year ending December
31, 1997. This firm of auditors and its predecessors has audited the accounts of
the Company and its subsidiaries for approximately four years. By virtue of
their familiarity with the Company's affairs and their ability, the Board of
Directors of the Company considers them best qualified to perform this important
function. It is expected that a representative of Deloitte & Touche LLP will be
present at the Annual Meeting, will have an opportunity to make a statement, if
he desires to do so, and will be available to answer appropriate questions from
stockholders.
The Board of Directors of the Company recommends that stockholders
vote FOR the ratification of the appointment of Deloitte & Touche LLP.
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STOCKHOLDER PROPOSALS
In order to be included in the proxy materials for the Company's
next annual meeting of stockholders, stockholders' proposals must be received by
the Company on or before January 6, 1998.
GENERAL
The accompanying proxy will be voted with respect to the matters
described above in the manner directed therein. If no choice is specified, it
will be voted FOR the election of the named nominees for directors, FOR the
approval of the 1997 Stock Option Plan and FOR the ratification of the
appointment of the independent auditors.
The Board of Directors does not know of any matters to come before
the meeting other than those mentioned in this Proxy Statement. If any other
matters which are not known to the Board of Directors should properly come
before the meeting, the accompanying proxy will be voted on such matters in
accordance with the judgment of the person or persons voting.
By Order of the Board of Directors
Joel S. Klein
Secretary
New York, New York
Dated: May 6, 1997
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EXHIBIT A
1997 STOCK OPTION PLAN
OF
AUDITS & SURVEYS WORLDWIDE, INC.
1. PURPOSES OF THE PLAN. This stock option plan (the "Plan") is designed to
provide an incentive to key employees (including directors and officers who are
key employees) and to consultants and directors who are not employees of AUDITS
& SURVEYS WORLDWIDE, INC., a Delaware corporation (the "Company"), or any of its
Subsidiaries (as such term is defined in Paragraph 19), and to offer an
additional inducement in obtaining the services of such individuals. The Plan
provides for the grant of "incentive stock options" ("ISOs") within the meaning
of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"),
and nonqualified stock options which do not qualify as ISOs ("NQSOs"). The
Company makes no representation or warranty, express or implied, as to the
qualification of any option as an "incentive stock option" under the Code.
2. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Paragraph 12, the
aggregate number of shares of Common Stock, $.01 par value per share, of the
Company ("Common Stock") for which options may be granted under the Plan shall
not exceed 1,000,000. Such shares of Common Stock may, in the discretion of the
Board of Directors of the Company (the "Board of Directors"), consist either in
whole or in part of authorized but unissued shares of Common Stock or shares of
Common Stock held in the treasury of the Company. Subject to the provisions of
Paragraph 13, any shares of Common Stock subject to an option which for any
reason expires, is cancelled or is terminated unexercised or which ceases for
any reason to be exercisable shall again become available for the granting of
options under the Plan. The Company shall at all times during the term of the
Plan reserve and keep available such number of shares of Common Stock as will be
sufficient to satisfy the requirements of the Plan.
3. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the Board of
Directors or a committee of the Board of Directors consisting of not less than
two directors, each of whom shall be a "non-employee director" within the
meaning of Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as
amended (as the same may be in effect and interpreted from time to time, "Rule
16b-3"). Those administering the Plan are referred to as the "Committee". Unless
otherwise provided in the By-Laws of the Company or by resolution of the Board
of Directors, a majority of the members of the Committee shall constitute a
quorum, and the acts of a majority of the members present at any meeting at
which a quorum is present, and any acts approved in writing by all members
without a meeting, shall be the acts of the Committee.
Subject to the express provisions of the Plan, the Committee shall have
the authority, in its sole discretion, to determine the key employees who shall
receive Employee Options (as such term is defined in Paragraph 19), the
consultants who shall receive Consultant Options (as such term is defined in
Paragraph 19), and the directors who shall receive Outside Director Options (as
such term is defined in Paragraph 19); the times when they shall receive
options; whether an Employee Option shall be an ISO or a NQSO; the number of
shares of Common Stock to be subject to each option; the term of each option;
the date each option shall become exercisable; whether an option shall be
exercisable in whole or in installments, and, if in installments, the number of
shares of Common Stock to be subject to each installment; whether the
installments shall be cumulative; the date each installment shall become
exercisable and the term of each installment; whether to accelerate the date
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<PAGE>
of exercise of any option or installment; whether shares of Common Stock may be
issued upon the exercise of an option as partly paid, and, if so, the dates when
future installments of the exercise price shall become due and the amounts of
such installments; the exercise price of each option; the form of payment of the
exercise price; the fair market value of a share of Common Stock; whether to
restrict the sale or other disposition of the shares of Common Stock acquired
upon the exercise of an option and, if so, whether and under what conditions to
waive any such restriction; whether and under what conditions to subject the
exercise of all or any portion of an option to the fulfillment of certain
restrictions or contingencies as specified in the contract referred to in
Paragraph 11 (the "Contract"), including without limitation, restrictions or
contingencies relating to entering into a covenant not to compete with the
Company, its Parent (as such term is defined in Paragraph 19) and Subsidiaries,
to financial objectives for the Company, a Subsidiary, a division, a product
line or other category, and/or the period of continued employment of the
optionee with the Company or its Subsidiaries, and to determine whether such
restrictions or contingencies have been met; the amount, if any, necessary to
satisfy the obligation of the Company, a Subsidiary or Parent to withhold taxes
or other amounts; whether an optionee is Disabled (as such term is defined in
Paragraph 19); with the consent of the optionee, to cancel or modify an option,
PROVIDED that the modified provision is permitted to be included in an option
granted under the Plan on the date of the modification, and PROVIDED FURTHER,
that in the case of a modification (within the meaning of Section 424(h) of the
Code) of an ISO, such option as modified would be permitted to be granted on the
date of such modification under the terms of the Plan; to construe the
respective Contracts and the Plan; to prescribe, amend and rescind rules and
regulations relating to the Plan; to approve any provision of the Plan or any
option granted under the Plan or any amendment to either which, under Rule
16b-3, requires the approval of the Board of Directors, a committee of
non-employee directors or the stockholders to be exempt (unless otherwise
specifically provided herein); and to make all other determinations necessary or
advisable for administering the Plan. Any controversy or claim arising out of or
relating to the Plan, any option granted under the Plan or any Contract shall be
determined unilaterally by the Committee in its sole discretion. The
determinations of the Committee on the matters referred to in this Paragraph 3
shall be conclusive and binding on the parties.
No member or former member of the Committee shall be liable for any action
or determination made in good faith with respect to the Plan or any option
granted hereunder. In addition, each member and former member of the Committee
shall be indemnified and held harmless by the Company from and against any
liability, claim for damages and expenses in connection therewith by reason of
any action or failure to act under or in connection with the Plan, any option
granted hereunder or any Contract to the fullest extent permitted with respect
to directors under the Company's certificate of incorporation, By-Laws and
applicable law.
4. ELIGIBILITY. The Committee may from time to time, consistent with the
purposes of the Plan, grant (a) Employee Options to such key employees
(including officers and directors who are key employees) of the Company or any
of its Subsidiaries, (b) Consultant Options to such consultants of the Company
or any of its Subsidiaries and (c) Outside Director Options to such directors of
the Company who, at the time of grant, are not common law employees of the
Company or of any of its Subsidiaries, as the Committee may determine in its
sole discretion. Such options granted shall cover such number of shares of
Common Stock as the Committee may determine in its sole discretion; PROVIDED,
HOWEVER, that the maximum number of shares subject to Employee Options that may
be granted to any individual during any calendar year under the Plan shall be
250,000 shares; and PROVIDED FURTHER that the aggregate market value (determined
at the time the option is granted) of the shares of Common Stock for which any
eligible employee may be granted ISOs under the Plan or any other plan of the
Company, or of a Parent or a Subsidiary of the Company, which are exercisable
for the first time by such optionee during any calendar year shall not exceed
$100,000. The $100,000 ISO limitation shall be applied by taking ISOs into
account in the order in which they were granted. Any option (or the portion
thereof) granted in excess of such ISO limitation amount shall be treated as a
NQSO to the extent of such excess.
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5. EXERCISE PRICE. The exercise price of the shares of Common Stock under
each option shall be determined by the Committee in its sole discretion;
PROVIDED, HOWEVER, that the exercise price of an ISO shall not be less than the
fair market value of the Common Stock subject to such option on the date of
grant; and PROVIDED FURTHER that if, at the time an ISO is granted, the optionee
owns (or is deemed to own under Section 424(d) of the Code) stock possessing
more than 10% of the total combined voting power of all classes of stock of the
Company, of any of its Subsidiaries or of a Parent, the exercise price of such
ISO shall not be less than 110% of the fair market value of the Common Stock
subject to such ISO on the date of grant.
The fair market value of a share of Common Stock on any day shall be (a)
if the principal market for the Common Stock is a national securities exchange,
the average of the highest and lowest sales prices per share of the Common Stock
on such day as reported by such exchange or on a consolidated tape reflecting
transactions on such exchange, (b) if the principal market for the Common Stock
is not a national securities exchange and the Common Stock is quoted on the
Nasdaq Stock Market ("Nasdaq"), and (i) if actual sales price information is
available with respect to the Common Stock, the average of the highest and
lowest sales prices per share of the Common Stock on such day on Nasdaq, or (ii)
if such information is not available, the average of the highest bid and the
lowest asked prices per share for the Common Stock on such day on Nasdaq, or (c)
if the principal market for the Common Stock is not a national securities
exchange and the Common Stock is not quoted on Nasdaq, the average of the
highest bid and lowest asked prices per share for the Common Stock on such day
as reported on the OTC Bulletin Board Service or by National Quotation Bureau,
Incorporated or a comparable service; PROVIDED that if clauses (a), (b) and (c)
of this Paragraph are all inapplicable, or if no trades have been made or no
quotes are available for such day, the fair market value of a share of Common
Stock shall be determined by the Committee by any method consistent with
applicable regulations adopted by the Treasury Department relating to stock
options.
6. TERM. The term of each option granted pursuant to the Plan shall be such
term as is established by the Committee, in its sole discretion, at or before
the time such option is granted; PROVIDED, HOWEVER, that the term of each ISO
granted pursuant to the Plan shall be for a period not exceeding 10 years from
the date of grant thereof, and PROVIDED FURTHER that if, at the time an ISO is
granted, the optionee owns (or is deemed to own under Section 424(d) of the
Code) stock possessing more than 10% of the total combined voting power of all
classes of stock of the Company, of any of its Subsidiaries or of a Parent, the
term of the ISO shall be for a period not exceeding five years from the date of
grant. Options shall be subject to earlier termination as hereinafter provided.
7. EXERCISE. An option (or any part or installment thereof), to the extent
then exercisable, shall be exercised by giving written notice to the Company at
its principal office stating which option is being exercised, specifying the
number of shares of Common Stock as to which such option is being exercised and
accompanied by payment in full of the aggregate exercise price therefor (or the
amount due on exercise if the applicable Contract permits installment payments)
(a) in cash or by certified check, or (b) if the applicable Contract permits,
with previously acquired shares of Common Stock, or with any combination of
cash, certified check or shares of Common Stock, having an aggregate fair market
value, on the date of exercise, equal to the aggregate exercise price of all
options being exercised. In such case, the fair market value of the Common Stock
shall be determined in accordance with Paragraph 5.
The Committee may, in its sole discretion, permit payment of the exercise
price of an option by delivery by the optionee of a properly executed notice,
together with a copy of his irrevocable instructions to a broker acceptable to
the Committee to deliver promptly to the Company the amount of sale or loan
proceeds sufficient
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to pay such exercise price. In connection therewith, the Company may enter into
agreements for coordinated procedures with one or more brokerage firms.
A person entitled to receive Common Stock upon the exercise of an option
shall not have the rights of a stockholder with respect to such shares of Common
Stock until the date of issuance of a stock certificate to him for such shares
or, in the case of uncertificated shares, until the date an entry is made on the
books of the Company's transfer agent representing such shares; PROVIDED,
HOWEVER, that until such stock certificate is issued or until such book entry is
made, any optionee using previously acquired shares of Common Stock in payment
of an option exercise price shall continue to have the rights of a stockholder
with respect to such previously acquired shares.
In no case may a fraction of a share of Common Stock be purchased or
issued under the Plan.
8. TERMINATION OF RELATIONSHIP. Except as may otherwise be expressly provided
in the applicable Contract, any holder of an Employee Option whose employment
with the Company (and its Parent and Subsidiaries) has terminated for any reason
other than his death or Disability may exercise such option, to the extent
exercisable on the date of such termination, at any time within three months
after the date of termination, but not thereafter and in no event after the date
the option would otherwise have expired; PROVIDED, HOWEVER, that if his
employment is terminated either (a) for cause, or (b) without the consent of the
Company, such option shall terminate immediately. Except as may otherwise be
expressly provided in the applicable Contract, Employee Options granted under
the Plan shall not be affected by any change in the status of the holder so long
as he continues to be an employee or a consultant of the Company, its Parent or
any of the Subsidiaries (regardless of having been transferred from one
corporation to another).
For the purposes of the Plan, an employment relationship shall be deemed
to exist between an individual and a corporation if, at the time of the
determination, the individual was an employee of such corporation for purposes
of Section 422(a) of the Code. As a result, an individual on military, sick
leave or other bona fide leave of absence shall continue to be considered an
employee for purposes of the Plan during such leave if the period of the leave
does not exceed 90 days, or, if longer, so long as the individual's right to
reemployment with the Company, any of its Subsidiaries or a Parent is guaranteed
either by statute or by contract. If the period of leave exceeds 90 days and the
individual's right to reemployment is not guaranteed by statute or by contract,
the employment relationship shall be deemed to have terminated on the 91st day
of such leave.
Except as may otherwise be expressly provided in the applicable Contract,
the holder of a Consultant Option whose consulting relationship with the Company
(and its Parent and Subsidiaries) has terminated for any reason may exercise
such option to the extent exercisable on the date of such termination, at any
time within three months after the date of termination, but not thereafter and
in no event after the date the option would otherwise have expired; PROVIDED,
HOWEVER, that if such relationship is terminated either (a) for cause or (b)
without the consent of the Company (other than as a result of the death or
Disability of the holder or a key employee of the holder), such option shall
terminate immediately. Except as may otherwise be expressly provided in the
applicable Contract, Consultant Options granted under the Plan shall not be
affected by a change in the relationship with the holder, so long as the
optionee continues to be a consultant of the Company, its Parent or any of its
Subsidiaries (regardless of having ceased to be a consultant for any other of
such corporations).
Except as may otherwise be expressly provided in the applicable Contract,
the holder of an Outside Director Option whose directorship with the Company has
terminated for any reason other than his death or Disability may exercise such
option, to the extent exercisable on the date of such termination, at any time
within
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three months after the date of termination, but not thereafter and in no event
after the date the option would otherwise have expired; PROVIDED, HOWEVER, that
if his directorship is terminated for cause, such option shall terminate
immediately.
Nothing in the Plan or in any option granted under the Plan shall confer
on any person any right to continue in the employ or as a consultant of the
Company, its Parent or any of its Subsidiaries, or as a director of the Company,
or interfere in any way with any right of the Company, its Parent or any of its
Subsidiaries to terminate such relationship at any time for any reason
whatsoever without liability to the Company, its Parent or any of its
Subsidiaries.
9. DEATH OR DISABILITY OF AN OPTIONEE. Except as may otherwise be expressly
provided in the applicable Contract, if an optionee dies (a) while he is
employed by, or a consultant to, the Company, its Parent or any of its
Subsidiaries, (b) within three months after the termination of his employment or
consulting relationship with the Company, its Parent and its Subsidiaries
(unless such termination was for cause or without the consent of the Company) or
(c) within one year following the termination of such employment or consulting
relationship by reason of his Disability, his Employee Option may be exercised,
to the extent exercisable on the date of his death, by his Legal Representative
(as such term is defined in Paragraph 19), at any time within one year after
death, but not thereafter and in no event after the date the option would
otherwise have expired. Except as may otherwise be expressly provided in the
applicable Contract, any optionee whose employment or consulting relationship
with the Company, its Parent and its Subsidiaries has terminated by reason of
his Disability may exercise his Employee Option, to the extent exercisable upon
the effective date of such termination, at any time within one year after such
date, but not thereafter and in no event after the date the option would
otherwise have expired.
The termination of a Consultant Option as a result of the death or
Disability of the optionee (or a key employee of the optionee) shall be governed
by Paragraph 8.
Except as may otherwise be expressly provided in the applicable Contract,
if an optionee dies (a) while he is a director of the Company, (b) within three
months after the termination of his directorship with the Company (unless such
termination was for cause) or (c) within one year after the termination
following the termination of his directorship by reason of his Disability, his
Outside Director Options may be exercised, to the extent exercisable on the date
of his death, by his Legal Representative at any time within one year after
death, but not thereafter and in no event after the date the option would
otherwise have expired. Except as may otherwise be expressly provided in the
applicable Contract, an optionee whose directorship with the Company has
terminated by reason of Disability, may exercise his Outside Director Options,
to the extent exercisable on the effective date of such termination, at any time
within one year after such date, but not thereafter and in no event after the
date the option would otherwise have expired.
10. COMPLIANCE WITH SECURITIES LAWS. It is a condition to the exercise of any
option that either (a) a Registration Statement under the Securities Act of
1933, as amended (the "Securities Act"), with respect to the shares of Common
Stock to be issued upon such exercise shall be effective and current at the time
of exercise, or (b) there is an exemption from registration under the Securities
Act for the issuance of the shares of Common Stock upon such exercise. Nothing
herein shall be construed as requiring the Company to register shares subject to
any option under the Securities Act or to keep any Registration Statement
effective or current.
The Committee may require, in its sole discretion, as a condition to the
grant or exercise of an option, that the optionee execute and deliver to the
Company his representations and warranties, in form, substance and
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scope satisfactory to the Committee, which the Committee determines is necessary
or convenient to facilitate the perfection of an exemption from the registration
requirements of the Securities Act, applicable state securities laws or other
legal requirement, including without limitation, that (a) the shares of Common
Stock to be issued upon exercise of the option are being acquired by the
optionee for his own account, for investment only and not with a view to the
resale or distribution thereof, and (b) any subsequent resale or distribution of
shares of Common Stock by such optionee will be made only pursuant to (i) a
Registration Statement under the Securities Act which is effective and current
with respect to the shares of Common Stock being sold, or (ii) a specific
exemption from the registration requirements of the Securities Act, but in
claiming such exemption, the optionee, prior to any offer of sale or sale of
such shares of Common Stock, shall provide the Company with a favorable written
opinion of counsel satisfactory to the Company, in form, substance and scope
satisfactory to the Company, as to the applicability of such exemption to the
proposed sale or distribution.
In addition, if at any time the Committee shall determine, in its sole
discretion, that the listing or qualification of the shares of Common Stock
subject to such option on any securities exchange, Nasdaq or under any
applicable law, or the consent or approval of any governmental agency or
regulatory body, is necessary or desirable as a condition to, or in connection
with, the granting of an option or the issuing of shares of Common Stock
thereunder, such option may not be granted or exercised in whole or in part, as
the case may be, unless such listing, qualification, consent or approval shall
have been effected or obtained free of any conditions not acceptable to the
Committee.
11. STOCK OPTION CONTRACTS. Each option shall be evidenced by an appropriate
Contract which shall be duly executed by the Company and the optionee. Such
Contract shall contain such terms, provisions and conditions not inconsistent
herewith as may be determined by the Committee in its sole discretion. The terms
of each option and Contract need not be identical.
12. ADJUSTMENTS UPON CHANGES IN COMMON STOCK. Notwithstanding any other
provision of the Plan, in the event of any change in the outstanding Common
Stock by reason of a stock dividend, recapitalization, merger in which the
Company is the surviving corporation, spinoff, split-up, combination or exchange
of shares or the like which results in a change in the number or kind of shares
of Common Stock which is outstanding immediately prior to such event, the
aggregate number and kind of shares subject to the Plan, the aggregate number
and kind of shares subject to each outstanding option and the exercise price
thereof, and the maximum number of shares subject to Employee Options that may
be granted to any individual in any calendar year, shall be appropriately
adjusted by the Board of Directors, whose determination shall be conclusive and
binding on all parties thereto. Such adjustment may provide for the elimination
of fractional shares that might otherwise be subject to options without payment
therefor.
In the event of (a) the liquidation or dissolution of the Company, (b) a
merger in which the Company is not the surviving corporation or a consolidation,
or (c) any transaction (or series of related transactions) in which more than
50% of the outstanding Common Stock is transferred or exchanged for other
consideration, or shares of Common Stock in excess of the number of shares of
Common Stock outstanding immediately preceding the transaction are issued (other
than to stockholders of the Company with respect to their shares of stock in the
Company), any outstanding options shall terminate upon the earliest of any such
event, unless other provision is made therefor in the transaction.
13. AMENDMENTS AND TERMINATION OF THE PLAN. The Plan was adopted by the Board
of Directors on March 12, 1997. No option may be granted under the Plan after
March 11, 2007. The Board of Directors, without further approval of the
Company's stockholders, may at any time suspend or terminate the
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Plan, in whole or in part, or amend it from time to time in such respects as it
may deem advisable, including without limitation, in order that ISOs granted
hereunder meet the requirements for "incentive stock options" under the Code, to
comply with the provisions of Rule 16b-3 promulgated the Exchange Act or Section
162(m) of the Code or any change in applicable law or regulation, ruling or
interpretation of any governmental agency or regulatory body; PROVIDED, HOWEVER,
that no amendment shall be effective without the requisite prior or subsequent
stockholder approval which would (a) except as contemplated in Paragraph 12,
increase the maximum number of shares of Common Stock for which options may be
granted under the Plan, (b) change the eligibility requirements for individuals
entitled to receive options hereunder or (c) make any change for which
applicable law or any governmental agency or regulatory body requires
stockholder approval. No termination, suspension or amendment of the Plan shall
adversely affect the rights of an optionee under any option granted under the
Plan without such optionee's consent. The power of the Committee to construe and
administer any option granted under the Plan prior to the termination or
suspension of the Plan shall continue after such termination or during such
suspension.
14. NON-TRANSFERABILITY OF OPTIONS. No option granted under the Plan shall be
transferable other than by will or the laws of descent and distribution, and
options may be exercised, during the lifetime of the optionee, only by the
optionee or his Legal Representatives. Except to the extent provided above,
options may not be assigned, transferred, pledged, hypothecated or disposed of
in any way (whether by operation of law or otherwise) and shall not be subject
to execution, attachment or similar process, and any such attempted assignment,
transfer, pledge, hypothecation or disposition shall be null and void AB INITIO
and of no force or effect.
15. WITHHOLDING TAXES. The Company, or its Subsidiary or Parent, as
applicable, may withhold (a) cash or (b) with the consent of the Committee,
shares of Common Stock to be issued upon exercise of an option or a combination
of cash and shares, having an aggregate fair market value equal to the amount
which the Committee determines is necessary to satisfy the obligation of the
Company, a Subsidiary or Parent to withhold Federal, state and local income
taxes or other amounts incurred by reason of the grant, vesting, exercise or
disposition of an option or the disposition of the underlying shares of Common
Stock. Alternatively, the Company may require the optionee to pay to the Company
such amount, in cash, promptly upon demand. The Company shall not be required to
issue any shares of Common Stock pursuant to any such option until all required
payments have been made. Fair market value of the shares of Common Stock shall
be determined in accordance with Paragraph 5.
16. LEGENDS; PAYMENT OF EXPENSES. The Company may endorse such legend or
legends upon the certificates for shares of Common Stock issued upon exercise of
an option under the Plan and may issue such "stop transfer" instructions to its
transfer agent in respect of such shares as it determines, in its sole
discretion, to be necessary or appropriate to (a) prevent a violation of, or to
perfect an exemption from, the registration requirements of the Securities Act,
(b) implement the provisions of the Plan or any agreement between the Company
and the optionee with respect to such shares of Common Stock, or (c) permit the
Company to determine the occurrence of a "disqualifying disposition," as
described in Section 421(b) of the Code, of the shares of Common Stock
transferred upon the exercise of an ISO granted under the Plan.
The Company shall pay all issuance taxes with respect to the issuance of
shares of Common Stock upon the exercise of an option granted under the Plan, as
well as all fees and expenses incurred by the Company in connection with such
issuance.
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17. USE OF PROCEEDS. The cash proceeds to be received upon the exercise of an
option under the Plan shall be added to the general funds of the Company and
used for such corporate purposes as the Board of Directors may determine, in its
sole discretion.
18. SUBSTITUTIONS AND ASSUMPTIONS OF OPTIONS OF CERTAIN CONSTITUENT
CORPORATIONS. Anything in this Plan to the contrary notwithstanding, the Board
of Directors may, without further approval by the stockholders, substitute new
options for prior options of a Constituent Corporation (as such term is defined
in Paragraph 19) or assume the prior options of such Constituent Corporation.
19. DEFINITIONS.
"Constituent Corporation" shall mean any corporation which engages with
the Company, its Parent or any Subsidiary in a transaction to which Section
424(a) of the Code applies (or would apply if the option assumed or substituted
were an ISO), or any Parent or any Subsidiary of such corporation.
"Consultant Option" shall mean a NQSO granted pursuant to the Plan to a
person who, at the time of grant, is a consultant of the Company or any of its
Subsidiaries and at such time is not a common law employee of the Company or any
of its Subsidiaries.
"Disability" shall mean a permanent and total disability within the
meaning of Section 22(e)(3) of the Code.
"Employee Option" shall mean an option granted pursuant to the Plan to an
individual who, at the time of grant, is a key employee of the Company or a
Subsidiary of the Company.
"Legal Representative" shall mean the executor, administrator or other
person who at the time is entitled by law to exercise the rights of a deceased
or incapacitated optionee with respect to an option granted under the Plan.
"Outside Director Option" shall mean a NQSO granted pursuant to the Plan
to a director of the Company who, at the time of the grant, is not a common law
employee of the Company or any of its Subsidiaries.
"Parent" shall have the same definition as "parent corporation" in Section
424(e) of the Code.
"Subsidiary" shall have the same definition as "subsidiary corporation" in
Section 424(f) of the Code.
20. GOVERNING LAW. The Plan, such options as may be granted hereunder, the
Contracts and all related matters shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without regard to conflict
of law provisions that would defer to the substantive laws of another
jurisdiction.
Neither the Plan nor any Contract shall be construed or interpreted with
any presumption against the Company by reason of the Company causing the Plan or
Contract to be drafted. Whenever from the context it appears appropriate, any
term stated in either the singular or plural shall include the singular and
plural, and any term stated in the masculine, feminine or neuter gender shall
include the masculine, feminine and neuter.
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21. PARTIAL INVALIDITY. The invalidity, illegality or unenforceability of any
provision in the Plan, any option or Contract shall not affect the validity,
legality or enforceability of any other provision, all of which shall be valid,
legal and enforceable to the fullest extent permitted by applicable law.
22. STOCKHOLDER APPROVAL. The Plan shall be subject to approval by a majority
of the votes present in person or by proxy entitled to vote hereon at the next
duly held meeting of the Company's stockholders at which a quorum is present. No
options granted hereunder may be exercised prior to such approval, PROVIDED that
the date of grant of any option shall be determined as if the Plan had not been
subject to such approval. Notwithstanding the foregoing, if the Plan is not
approved by a vote of the stockholders of the Company on or before March 11,
1998, the Plan and any options granted hereunder shall terminate.
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================================================================================
PROXY
AUDITS & SURVEYS WORLDWIDE, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS - JUNE 12, 1997
H. Arthur Bellows, Jr. and Joel S. Klein, and each of them,
with full power of substitution, are hereby appointed proxies to vote
all shares of common stock, par value $0.01 per share, of Audits &
Surveys Worldwide, Inc. that the undersigned is entitled to vote at
the Annual Meeting of Stockholders of the Corporation to be held on
Thursday, June 12, 1997 at The Chase Manhattan Bank, N.A., 11th
Floor, 270 Park Avenue (at 48th Street), New York, New York 10017, at
10:00 A.M., and any adjournments or postponements thereof.
(CONTINUED AND TO BE SIGNED ON OTHER SIDE.)
================================================================================
================================================================================
A [X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
FOR ALL WITHHOLD FOR NOMINEES: SOLOMON DUTKA
NOMINEES ALL NOMINEES H. ARTHUR BELLOWS, JR.
LISTED LISTED JOSEPH T. PLUMMER
[_] [_] CARL RAVITCH
ITEM 1 CHARLES E. BRADLEY
ELECTION OF BRIAN G. DYSON
DIRECTORS MATTHEW GOLDSTEIN
ROBERT C. MILLER
WILLIAM NEWMAN
SOL YOUNG
WILLIAM ZEBEDEE
FOR AGAINST ABSTAIN
ITEM 2: TO APPROVE THE ADOPTION OF THE 1997 [_] [_] [_]
STOCK OPTION PLAN
ITEM 3: TO RATIFY THE APPOINTMENT OF DELOITTE [_] [_] [_]
& TOUCHE LLP AS THE COMPANY'S
INDEPENDENT ACCOUNTANTS FOR THE YEAR 1997
ITEM 4: UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE ANNUAL
MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF.
(INSTRUCTION: ONLY CHECK THE THE SHARES REPRESENTED BY THIS PROXY
"WITHHOLD FOR ALL NOMINEES LISTED" WILL BE VOTED AS DIRECTED BY THE
BOX IF AUTHORITY TO VOTE FOR ALL STOCKHOLDER. IF NO DIRECTION IS
NOMINEES IS WITHHELD. TO WITHHOLD GIVEN WITH RESPECT TO ANY ITEM, THE
ALL AUTHORITY TO VOTE FOR ANY SHARES WILL VOTED FOR ITEMS 1, 2 AND
INDIVIDUAL NOMINEE WRITE THAT 3 AND IN THE DISCRETION OF THE
NOMINEE'S NAME IN THE SPACE PROXIES ON ANY OTHER MATTER WHICH
PROVIDED BELOW.) PROPERLY COMES BEFORE THE ANNUAL
MEETING OR ANY ADJOURNMENTS OR
____________________________________ POSTPONEMENTS THEREOF. THE
UNDERSIGNED HEREBY REVOKES ANY PROXY
HERETOFORE GIVEN.
I WILL ATTEND MEETING. [_]
________________________ __________________________ DATED:_________, 1997
SIGNATURE OF STOCKHOLDER SIGNATURE IF HELD JOINTLY
NOTE: PLEASE MARK AND DATE THE PROXY AND SIGN YOUR NAME AS IT APPEARS HEREON.
IF EXECUTED BY A CORPORATION, A DULY AUTHORIZED OFFICER SHOULD SIGN.
EXECUTORS, ADMINISTRATORS AND TRUSTEES SHOULD SO INDICATE WHEN SIGNING.
IF SHARES ARE HELD JOINTLY EACH HOLDER SHOULD SIGN.
