SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant |X|
Filed by a party other than the registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission only (as
permitted by Rule 14a-6(e)2)
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule
14(a)-12
The Millbrook Press Inc.
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(Name of Registrant as Specified in Charter)
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(Name of Person(s) filing Proxy Statement, if other than 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:
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(2) Aggregate number of securities to which transaction
applies:
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(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth
the amount on which the filing fee is calculated and
state how it was determined):
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(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:
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(2) Form, Schedule or Registration Statement no.:
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(3) Filing Party:
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(4) Date Filed:
THE MILLBROOK PRESS INC.
--------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD NOVEMBER 29, 2001
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To the Stockholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of THE MILLBROOK PRESS INC., a Delaware corporation (the "Company"),
will be held at The Harmonie Club, 4 East 60th Street, New York, New York 10022,
on November 29, 2001, at 10:00 A.M., Local Time, for the following purposes:
1. To elect five (5) members of the Board of Directors
to serve until the next annual meeting of stockholders and until
their successors have been duly elected and qualified;
2. To ratify the appointment of Arthur Andersen LLP as
the Company's independent auditors for the year ending July 31,
2002; and
3. To transact such other business as may properly be
brought before the Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on October
30, 2001 as the record date for the Meeting. Only stockholders of record on the
stock transfer books of the Company at the close of business on that date are
entitled to notice of, and to vote at, the Meeting.
By Order of the Board of Directors
DAVID ALLEN,
SECRETARY
Dated: November 2, 2001
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, YOU ARE
URGED TO FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE THAT
IS PROVIDED, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
THE MILLBROOK PRESS INC.
2 OLD NEW MILFORD ROAD
BROOKFIELD, CONNECTICUT 06804
----------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 29, 2001
----------------
INTRODUCTION
This Proxy Statement is being furnished to stockholders by the Board
of Directors of THE MILLBROOK PRESS INC., a Delaware corporation (the
"Company"), in connection with the solicitation of the accompanying Proxy for
use at the 2001 Annual Meeting of Stockholders of the Company (the "Meeting") to
be held at The Harmonie Club, 4 East 60th Street, New York, New York 10022, on
November 29, 2001, at 10:00 A.M., Local Time, or at any adjournment thereof.
The principal executive offices of the Company are located at 2 Old
New Milford Road, Brookfield, Connecticut 06804. The approximate date on which
this Proxy Statement and the accompanying Proxy will first be sent or given to
stockholders is November 2, 2001.
RECORD DATE AND VOTING SECURITIES
Only stockholders of record at the close of business on October 30,
2001, the record date (the "Record Date") for the Meeting, will be entitled to
notice of, and to vote at, the Meeting and any adjournment thereof. As of the
close of business on the Record Date, there were 2,849,887 outstanding shares of
the Company's common stock, $.01 par value (the "Common Stock"). Each of such
shares is entitled to one vote. There was no other class of voting securities of
the Company outstanding on that date. All shares of Common Stock have equal
voting rights. A majority of the outstanding shares of Common Stock present in
person or by proxy is required for a quorum.
VOTING OF PROXIES
Shares of Common Stock represented by Proxies, which are properly
executed, duly returned and not revoked will be voted in accordance with the
instructions contained therein. If no specification is indicated on the Proxy,
the shares of Common Stock represented thereby will be voted (i) for the
election as Directors of the persons who have been nominated by the Board of
Directors, (ii) for the ratification of the appointment of Arthur
Andersen LLP as the Company's independent auditors for the year ending July 31,
2002, and (iii) for any other matter that may properly be brought before the
Meeting or any adjournment thereof in accordance with the judgment of the person
or persons voting the Proxies.
The execution of a Proxy will in no way affect a stockholder's right
to attend the Meeting and vote in person. Any Proxy executed and returned by a
stockholder may be revoked at any time thereafter if written notice of
revocation is given to the Secretary of the Company prior to the vote to be
taken at the Meeting, or by execution of a subsequent proxy which is presented
to the Meeting, or if the stockholder attends the Meeting and votes by ballot,
except as to any matter or matters upon which a vote shall have been cast
pursuant to the authority conferred by such Proxy prior to such revocation. For
purposes of determining the presence of a quorum for transacting business at the
Meeting, abstentions and broker "non-votes" (i.e., proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular matter
with respect to which the brokers or nominees do not have discretionary power)
will be treated as shares that are present but which have not been voted. Broker
non-votes will have no effect on the election of directors. Abstentions may be
specified on all proposals (except the election of directors) and will be
counted as present for purposes of the item on which the abstention is noted.
The cost of solicitation of the Proxies being solicited on behalf of
the Board of Directors will be borne by the Company. In addition to the use of
the mails, proxy solicitation may be made by telephone, telegraph and personal
interview by officers, directors and employees of the Company. The Company will,
upon request, reimburse brokerage houses and persons holding Common Stock in the
names of their nominees for their reasonable expenses in sending soliciting
material to their principals.
SECURITY OWNERSHIP
The following table sets forth information concerning ownership of
the Company's Common Stock, as of the Record Date, by each person known by the
Company to be the beneficial owner of more than five percent of the Common
Stock, each director, each executive officer, and nominee for election as a
director and by all directors and executive officers of the Company as a group.
Unless otherwise indicated, the address for directors, executive offices and 5%
stockholders is 2 Old New Milford Road, Brookfield, Connecticut 06804.
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NAME AND ADDRESS SHARES PERCENTAGE
OF BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS(1)
------------------- ------------------ -----------
Barry Fingerhut 1,466,035 (2)(24) 45.0%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Irwin Lieber 1,441,535 (3)(24) 44.2%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Barry Rubenstein 1,437,536 (4)(24) 44.1%
68 Wheatley Road
Brookville, NY 11545
Harvey Sandler 1,096,261 (5)(24) 36.7%
767 Fifth Avenue, 45th Floor
New York, NY 10153
John Kornreich 1,085,917 (6)(24) 36.4%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Barry Lewis 1,085,917 (7)(24) 36.4%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Michael J. Marocco 1,085,917 (8)(24) 36.4%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Andrew Sandler 1,072,988 (9)(24) 35.9%
767 Fifth Avenue, 45th Floor
New York, NY 10153
21st Century Communications 1,068,678(10)(24) 35.8%
Foreign Partners, L.P.
c/o Fiduciary Trust (Cayman) Limited
P.O. Box 1062
Grand Cayman, B.W.I.
21st Century Communications 1,068,678(11)(24) 35.8%
Partners, L.P.
767 Fifth Avenue, 45th Floor
New York, NY 10153
21st Century Communications 1,068,678(12)(24) 35.8%
T-E Partners, L.P.
767 Fifth Avenue, 45th Floor
New York, NY 10153
Applewood Capital Corp. 200,000(13)(24) 6.5%
80 Cutter Mill Road
Great Neck, NY 11021
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NAME AND ADDRESS SHARES PERCENTAGE
OF BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS(1)
------------------- ------------------ -----------
Jonathan Lieber 208,310(14)(22) 6.8%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Seth Lieber 208,310(15)(24) 6.8%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Wheatley Partners II, L.P. 200,000(16)(24) 6.5%
80 Cutter Mill Road
Great Neck, NY 11021
Pamela Fingerhut 197,357(17)(24) 6.7%
767 Fifth Avenue, 45th Floor
New York, NY 10153
Shufro, Rose & Co., LLC 194,000 (18) 6.8%
745 Fifth Avenue
New York, NY 10151
Frank J. Farrell 172,422 (19) 5.8%
Howard Graham 235,475 (20) 7.7%
Jean E. Reynolds 50,005 (21) 2.3%
David Allen 29,500 (22) *
Richard McCullough 6,666 (22) *
Hannah Stone 2,586 *
Bruno A. Quinson 1,250 (22) *
Joseph Kanon 1,250 (22) *
All directors and executive
officers as a group (8 persons) 499,154 (23) 14.6%
--------------------
*Less than 1%
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission ("Commission") and generally
includes voting or investment power with respect to securities, shares
of Common Stock upon the exercise of options, warrants currently
exercisable, or exercisable or convertible within 60 days, are deemed
outstanding for computing the percentage ownership of the person
holding such options or
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warrants but are not deemed outstanding for computing the percentage
ownership of any other person.
(2) Represents (i) 108,357 shares of Common Stock owned by Mr. Fingerhut,
(ii) an aggregate of 943,678 shares of Common Stock owned by 21st
Century Communications Partners, L.P. ("21st Partners"), 21st Century
Communications T-E Partners, L.P. ("21st T-E") and 21st Century
Communications Foreign Partners, L.P. ("21st Foreign"),(iii) 200,000
shares of Common Stock issuable upon the exercise of presently
exercisable warrants ("Bridge Warrants") held by Wheatley Partners II,
L.P., formerly Applewood Associates, L.P. ("Wheatley") issued in an
August 1996 Bridge Financing ("Bridge Financing"), (iv) 125,000 shares
of Common Stock issuable upon the exercise of presently exercisable
Bridge Warrants held by 21st Partners, 21st T-E, and 21st Foreign, (v)
14,000 shares owned by Pamela Fingerhut, the wife of Mr. Fingerhut and
(vi) 75,000 shares of Common Stock issuable upon exercise of Bridge
Warrants held by Mr. Fingerhut. By virtue of being a shareholder,
officer and director of InfoMedia Associates, L.P. ("InfoMedia") which
is a general partner of 21st Partners, 21st T-E and 21st Foreign, a
general partner of Wheatley, and the husband of Pamela Fingerhut, Mr.
Fingerhut may be deemed to have shared power to vote and to dispose of
1,282,678 shares of Common Stock owned by such recordholders, of which
Mr. Fingerhut disclaims beneficial ownership, except to the extent of
his equity interest in such recordholders.
(3) Represents (i) 97,857 shares owned by Mr. Lieber, (ii) 943,678 shares
of Common Stock owned by 21st Partners, 21st T-E and 21st
Foreign,(iii) 200,000 shares of Common Stock issuable upon the
exercise of presently exercisable Bridge Warrants held by Wheatley,
(iv) 125,000 shares of Common Stock issuable upon the exercise of
presently exercisable Bridge Warrants held by 21st Partners, 21st T-E
and 21st Foreign and (v) 75,000 shares of Common Stock issuable upon
the exercise of presently exercisable Bridge Warrants held by Mr.
Lieber. By virtue of being a shareholder, officer and director of
InfoMedia which is a general partner of 21st Partners, 21st T-E and
21st Foreign, and a general partner of Wheatley, Mr. Lieber may be
deemed to have shared power to vote and dispose of the shares of
Common Stock owned by 21st Partners, 21st T-E and 21st Foreign and
Wheatley. Mr. Lieber disclaims beneficial ownership of the securities
owned by 21st Partners, 21st T-E and 21st Foreign and Wheatley, except
to the extent of his equity interest in such recordholders.
(4) Represents (i) an aggregate of 943,678 shares of Common Stock owned by
21st Partners, 21st T-E and 21st Foreign, (ii) 89,858 shares of Common
Stock owned by Woodland Partners ("Woodland"), (iii) 275,000 shares of
Common Stock issuable upon the exercise of presently exercisable
Bridge Warrants held by Wheatley and Woodland, (iv) 125,000 shares of
Common Stock issuable upon presently exercisable Bridge Warrants held
by 21st Partners, 21st T-E and 21st Foreign and (v) 4,000 shares owned
by Brian Rubenstein, the son of Barry Rubenstein. By virtue of being a
shareholder, officer and director of InfoMedia which is a general
partner of 21st Partners, 21st T-E and 21st Foreign and a general
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partner of Wheatley and Woodland, Mr. Rubenstein may be deemed to have
shared power to vote and dispose of the securities owned by 21st
Partners, 21st T-E and 21st Foreign, Wheatley and Woodland and the
father of Brian Rubenstein. Mr. Rubenstein disclaims beneficial
ownership of all of the above securities except to the extent of his
equity interest in such recordholders.
(5) Represents (i) 27,583 shares of Common Stock owned by Mr. Sandler,
(ii) 943,678 shares of Common Stock owned by 21st Partners, 21st T-E
and 21st Foreign and (iii) 125,000 shares of Common Stock issuable
upon the exercise of presently exercisable Bridge Warrants held by
21st Partners, 21st T-E and 21st Foreign. By virtue of being the
majority shareholder and director of an entity which is a general
partner of an entity which is the general partner of another entity
which is a general partner of 21st Partners, 21st T-E and 21st
Foreign, Mr. Sandler may be deemed to have shared power to vote and to
dispose of the securities owned by 21st Partners, 21st T-E and 21st
Foreign, of which Mr. Sandler disclaims beneficial ownership.
(6) Represents (i) 17,239 shares of Common Stock owned by Mr. Kornreich,
(ii) 943,678 shares of Common Stock owned by 21st Partners, 21st T-E
and 21st Foreign and (iii) 125,000 shares of Common Stock issuable
upon the exercise of presently exercisable Bridge Warrants held by
21st Partners, 21st T-E and 21st Foreign. By virtue of being the
majority shareholder and director of an entity which is a general
partner of an entity which is the general partner of another entity
which is a general partner of 21st Partners, 21st T-E and 21st
Foreign, Mr. Kornreich may be deemed to have shared power to vote and
to dispose of the securities owned by 21st Partners, 21st T-E and 21st
Foreign, of which Mr. Kornreich disclaims beneficial ownership.
(7) Represents (i) 17,239 shares of Common Stock owned by Mr. Lewis, (ii)
943,678 shares of Common Stock owned by 21st Partners, 21st T-E and
21st Foreign and (iii) 125,000 shares of Common Stock issuable upon
the exercise of presently exercisable Bridge Warrants held by 21st
Partners, 21st T-E and 21st Foreign. By virtue of being the majority
shareholder and director of an entity which is a general partner of an
entity which is the general partner of another entity which is a
general partner of 21st Partners, 21st T-E and 21st Foreign, Mr. Lewis
may be deemed to have shared power to vote and to dispose of the
securities owned by 21st Partners, 21st T-E and 21st Foreign, of which
Mr. Lewis disclaims beneficial ownership.
(8) Represents (i) 17,239 shares of Common Stock owned by Mr. Marocco,
(ii) an aggregate of 943,678 shares of Common Stock owned by 21st
Partners, 21st T-E and 21st Foreign and (iii) 125,000 shares of Common
Stock issuable upon the exercise of presently exercisable Bridge
Warrants held by 21st Partners, 21st T-E and 21st Foreign. By virtue
of being the sole shareholder, officer and director of an entity which
is a general partner of an entity which is the general partner of
another entity which is a general partner of 21st Partners, 21st T-E
and 21st Foreign, Mr. Marocco may be deemed to have shared power to
vote and to dispose of the
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securities owned by 21st Partners, 21st T-E and 21st Foreign, of which
Mr. Marocco disclaims beneficial ownership.
(9) Represents (i) 4,310 shares of Common Stock owned by Mr. Sandler, (ii)
an aggregate of 943,678 shares of Common Stock owned by 21st Partners,
21st T-E and 21st Foreign and (iii) 125,000 shares of Common Stock
issuable upon the exercise of presently exercisable Bridge Warrants
held by 21st Partners, 21st T-E and 21st Foreign. By virtue of being
the majority shareholder and director of an entity which is a general
partner of an entity which is the general partner of another entity
which is a general partner of 21st Partners, 21st T-E and 21st
Foreign, Mr. Sandler may be deemed to have shared power to vote and to
dispose of the securities owned by 21st Partners, 21st T-E and 21st
Foreign, of which Mr. Sandler disclaims beneficial ownership.
(10) Represents (i) 86,142 shares of Common Stock owned by 21st Foreign,
(ii) 639,840 shares of Common Stock and 217,696 shares of Common Stock
owned by 21st Partners and 21st T-E, respectively, of which 21st
Foreign disclaims beneficial ownership, (iii) 11,500 shares of Common
Stock issuable upon the exercise of presently exercisable Bridge
Warrants held by 21st Foreign and (iv) 28,500 and 85,000 shares of
Common Stock issuable upon the exercise of presently exercisable
Bridge Warrants held by 21st T-E and 21st Partners, respectively. The
general partners of 21st Foreign are Sandler Investment Partners,
L.P., a New York limited partnership ("Sandler General Partner") and
InfoMedia. The general partner of the Sandler General Partner is
Sandler Capital Management, a New York general partnership ("SCM").
The general partners of SCM are corporations that are affiliates of
Harvey Sandler, Barry Lewis, John Kornreich, Michael Marocco and
Andrew Sandler. Infomedia's shareholders are Irwin Lieber, Barry
Fingerhut and Barry Rubenstein.
(11) Represents (i) 639,840 shares of Common Stock owned by 21st Partners,
(ii) 217,696 shares of Common Stock and 86,142 shares of Common Stock
owned by 21st T-E and 21st Foreign, respectively, of which 21st
Partners disclaims beneficial ownership (iii) 85,000 shares of Common
Stock issuable upon the exercise of presently exercisable Bridge
Warrants held by 21st Partners and (iv) 11,500 and 28,500 shares of
Common Stock issuable upon the exercise of presently exercisable
Bridge Warrants held by 21st Foreign and 21st T-E, respectively, of
which 21st Partners disclaims beneficial ownership. The general
partners of 21st Partners are the Sandler General Partner and
InfoMedia. The general partner of the Sandler General Partner is SCM.
The general partners of SCM are corporations that are affiliates of
one or more of Harvey Sandler, Barry Lewis, John Kornreich, Michael
Marocco and Andrew Sandler. InfoMedia's shareholders are Irwin Lieber,
Barry Fingerhut and Barry Rubenstein.
(12) Represents (i) 217,696 shares of Common Stock owned by 21st T-E, (ii)
639,840 shares of Common Stock and 86,142 shares of Common Stock owned
by 21st Partners and 21st Foreign, respectively, of which 21st T-E
disclaims beneficial ownership, (iii) 28,500 shares of Common Stock
issuable upon the exercise of presently
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exercisable Bridge Warrants held by 21st T-E and (iv) 11,500 and
85,000 shares of Common Stock issuable upon the exercise of presently
exercisable Bridge Warrants held by 21st Foreign and 21st Partners,
respectively, of which 21st T-E disclaims beneficial ownership. The
general partners of 21st Partners are the Sandler General Partner and
InfoMedia. The general partner of the Sandler General Partner is SCM.
The general partners of SCM are corporations that are affiliates of
one or more of Harvey Sandler, Barry Lewis, John Kornreich, Michael
Marocco and Andrew Sandler. Infomedia's shareholders are Irwin Lieber,
Barry Fingerhut and Barry Rubenstein.
(13) By virtue of being a general partner of Wheatley, Applewood Capital
Corp. ("Applewood Capital") has shared dispositive and voting power
with respect to 200,000 shares of Common Stock issuable upon exercise
of presently exercisable Bridge Warrants held by Wheatley.
(14) Represents (i) 8,310 shares of Common Stock owned by Mr. Lieber, and
(ii) 200,000 shares of Common Stock issuable upon the exercise of
presently exercisable Bridge Warrants held by Wheatley. By virtue of
being an affiliate of an entity which is a general partner of
Wheatley, Mr. Lieber may be deemed to have shared power to vote and
dispose of the shares of Common Stock owned by Wheatley. Mr. Lieber
disclaims beneficial ownership with respect to the securities owned by
Wheatley, except to the extent of his equity interest in such
recordholder. Jonathan Lieber is the son of Irwin Lieber.
(15) Represents (i) 8,310 shares of Common Stock owned by Mr. Lieber, and
(ii) 200,000 shares of Common Stock issuable upon the exercise of
presently exercisable Bridge Warrants held by Wheatley. By virtue of
being an affiliate of an entity which is a general partner of
Wheatley, Mr. Lieber may be deemed to have shared power to vote and
dispose of the shares of Common Stock owned by Wheatley. Mr. Lieber
disclaims beneficial ownership with respect to the securities owned by
Wheatley, except to the extent of his equity interest in such
recordholder. Seth Lieber is the son of Irwin Lieber.
(16) Represents 200,000 shares of Common Stock issuable upon the exercise
of presently exercisable Bridge Warrants. The general partners of
Wheatley are Irwin Lieber, Barry Rubenstein, Barry Fingerhut and
Applewood Capital.
(17) Represents (i)14,000 shares of Common Stock owned by Pamela Fingerhut
and (ii) 108,357 shares of Common Stock and 75,000 shares of Common
Stock issuable upon the exercise of presently exercisable Bridge
Warrants owned by Barry Fingerhut, the husband of Pamela Fingerhut.
Pamela Fingerhut disclaims beneficial ownership of the shares of
Common Stock and Bridge Warrants owned by Barry Fingerhut.
(18) Such information is derived from a Schedule 13G filed with the
Commission by such entity on February 15, 2001.
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(19) Includes 102,913 shares of Common Stock issuable upon presently
exercisable options.
(20) Represents 143,196 shares of Common Stock issuable upon presently
exercisable options, 12,500 shares of Common Stock issuable upon
presently exercisable Bridge Warrants which are owned by Mr. Graham
and his wife as joint tenants, and 79,779 shares of Common Stock which
are owned by Mr. Graham and his wife as joint tenants.
(21) Includes 35,499 shares of Common Stock issuable upon presently
exercisable options.
(22) Consists of shares issuable upon presently exercisable options.
(23) Includes 373,325 shares of Common Stock issuable upon presently
exercisable options, 12,500 shares of Common Stock issuable upon
presently exercisable Bridge Warrants held by Mr. Graham and 12,500
shares of Common Stock issuable upon presently exercisable Bridge
Warrants held by Mr. Conrad. Does not include shares or presently
exercisable Bridge Warrants held by 21st Foreign, 21st Partners and
21st T-E. Hannah Stone is Managing Director of SCM which is the
general partner of Sandler General Partner which is a general partner
of 21st Partners, 21st Foreign and 21st T-E.
(24) With respect to Wheatley, Barry Rubenstein, Irwin Lieber, Barry
Fingerhut, Applewood Capital, Seth Leiber, Jonathan Lieber and Pamela
Fingerhut the foregoing information is derived from a Schedule 13D
filed with the Commission by such individuals or entities on June 29,
1997, as amended through March 13, 2000. With respect to 21st
Partners, 21st T-E, 21st Foreign, Harvey Sandler, Barry Lewis, Michael
J. Marocco, John Kornreich and Andrew Sandler, the foregoing
information is derived from a Schedule 13D filed with the Commission
by such individuals or entities on June 29, 1997.
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PROPOSAL I--ELECTION OF DIRECTORS
NOMINEES
Unless otherwise specified, all Proxies received will be voted in
favor of the election of the persons named below as directors of the Company, to
serve until the next Annual Meeting of Stockholders of the Company and until
their successors shall be duly elected and qualified. Directors shall be elected
by a plurality of the votes cast, in person or by proxy, at the Meeting.
Abstentions from voting and broker nonvotes on the election of directors will
have no effect since they will not represent votes cast at the Meeting for the
purpose of electing directors. All nominees are currently directors of the
Company. The terms of the current directors expire at the Meeting and when their
successors are duly elected and qualified. Management has no reason to believe
that any of the nominees will be unable or unwilling to serve as a director, if
elected. Should any of the nominees not remain a candidate for election at the
date of the Meeting, the Proxies will be voted in favor of those nominees who
remain candidates and may be voted for substitute nominees selected by the Board
of Directors. The names of the nominees and certain information concerning them
are set forth below:
FIRST
YEAR
BECAME
NAME AGE DIRECTOR
---- --- --------
Howard Graham 71 1989
Frank J. Farrell 65 1989
Hannah Stone 36 1997
Bruno A. Quinson 63 1999
Joseph Kanon 55 1999
HOWARD GRAHAM, one of the Company's founders, has been a director of the
Company since its inception in 1989, served as a Vice-President since the
Company's inception in 1989 until December 1997 and has been Chairman of the
Board of the Company since October 1997. From 1970 to 1988, Mr. Graham served in
various senior management positions at Grolier, Inc. ("Grolier") and its
subsidiaries, including President of Grolier International and executive Vice
President of Grolier. He also served on Grolier's board of directors from 1983
to 1988. Mr. Graham currently serves as a director of the Save the Children
Fund, a nonprofit corporation.
FRANK J. FARRELL, one of the Company's founders, has been a director of
the Company since its inception and served as a Vice President and Secretary
since its inception until December 1996. From 1978 to 1989, Mr. Farrell served
in various senior management positions with Grolier and its subsidiaries,
including President of Grolier Educational Corporation and President of Grolier
Electronic Publishing, Inc. and Group Vice President
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of Grolier's domestic reference materials operations. He also served on
Grolier's board of directors from 1988 to 1989.
HANNAH STONE has served as a director of the Company since June 1997. Ms.
Stone is Managing Director of Sandler Capital Management, which she joined in
1993. Sandler Capital Management, through affiliates, is involved in the
management of 21st Partners, 21st T-E and 21st Foreign. Ms. Stone also serves as
a director of several private companies.
BRUNO A. QUINSON has served as a director of the Company since November
1999. Mr. Quinson served as Chief Executive Officer of Henry Holt and Co., Inc.
Prior to that Mr. Quinson was President of the General Books Division at the
Macmillan Publishing Co. Currently Mr. Quinson serves as a consultant to the
Publishing Industry.
JOSEPH KANON has served as a director of the Company since November 1999.
Mr. Kanon served as Executive Vice President for Trade and Reference Publishing
at Houghton Mifflin Inc. from 1987 to 1995. Prior to that Mr. Kanon was Chief
Executive Officer of E.P. Dutton. Mr. Kanon is currently an author and has
published two best-selling novels.
The Board of Directors has a Stock Option and Compensation Committee which
administers the Company's 1994 Stock Option Plan (the "Plan") and makes
recommendations concerning salaries, incentive compensation for employees of and
consultants to the Company, and an Audit Committee which reviews the results and
scope of the audit and other services provided by the Company's independent
accountants. The Stock Option and Compensation Committee is composed of Mr.
Graham and Ms. Stone. The Audit Committee is composed of Mr. Farrell, Ms. Stone
and Mr. Quinson. The Company also has a Finance Committee to review potential
equity or debt financings. Such Finance Committee consists of Mr. Graham, Ms.
Stone and Mr. Kanon. The Company presently does not have a Nominating Committee,
the customary functions of such committee being performed by the entire Board of
Directors.
DIRECTOR COMPENSATION
The Company's internal directors are not compensated for attendance at
meetings. The Company currently compensates its outside directors for services
rendered in their capacity as directors at a rate of $1,000 per meeting.
MEETINGS
The Board of Directors held three (4) meetings, during the year ended July
31, 2001. From time to time, the members of the Board of Directors act by
unanimous written consent pursuant to the laws of the State of Delaware.
AUDIT COMMITTEE REPORT
The audit committee reviews the Company's financial statements and
accounting policies, resolves potential conflicts of interest, receives and
reviews the recommendations of the independent auditors and confers with the
Company's independent auditors with respect to the training and supervision of
internal accounting personnel and the adequacy of internal accounting controls.
For the fiscal year ended July 31, 2001, the members of the Company's audit
committee were Mr. Farrell, Ms. Stone and Mr. Quinson. The audit committee has
adopted a written audit committee charter that is attached hereto as Appendix A.
The audit committee held one meeting during the fiscal year ended July
31, 2001. All its members were present in all meetings. The members of the audit
committee have reviewed and discussed the Company's audited financial statements
with the Company's management and have discussed matters required to be
discussed by SAS 61 (Codification of Statements on Auditing Standards, AU
Section 380) with Arthur Andersen LLP, the Company's independent auditors for
the fiscal year ended July 31, 2001. The audit committee has received the
written disclosures and the letter from Arthur Andersen LLP, as required by the
Independent Standards Board Standard No. 1, and have recommended that the
audited financial statements be included in the Company's annual report for the
fiscal year ended July 31, 2001.
OTHER EXECUTIVE OFFICERS
JEAN E. REYNOLDS, 59, one of the Company's founders, has served as Senior
Vice President-Publisher since October 1996 and as President of the Company from
its inception in 1989 to October 1996. From 1970 to 1981, Ms. Reynolds served in
various management positions at Grolier, including
11
the editor-in-chief of Young People's Publications and of The New Book of
Knowledge. Ms. Reynolds is a director of the Book Industry Study Group and
chairs its Juvenile Interest Group, which monitors industry statistics. She is a
director of the industry trade organization, The Children's Book Council. She
also serves as a director of Kiper Enterprises, Inc., a private company
specializing in first aid materials and Wellington Leisure Products, Inc., a
private company specializing in the manufacturing of rope, craft and watersports
material. On June 1, 2000, Ms. Reynolds was elected Executive Vice President and
Publisher of the Company.
DAVID ALLEN, 46, has been Vice President and Chief Financial Officer of
the Company since February 1999. Prior thereto, Mr. Allen was (i) Vice President
of JDM, Inc. from December 1996 to December 1998, and (ii) Vice President, Atlas
Editions, Inc. formerly GMH Marketing, from June 1985 to December 1996. On June
1, 2000, Mr. Allen was named Executive Vice President and Chief Operating
Officer of the Company.
RICHARD McCULLOUGH, 51, has served as Vice President of Trade Sales for the
Company since July 1999. Previously, Mr. McCullough was (i) an independent
consultant from July 1997 to July 1999, (ii) Director Trade Sales and Marketing
for McGraw Hill from 1993 to 1997, and (iii) Vice President Sales for John Wiley
& Sons from 1980 to 1993. On June 1, 2001, Mr. McCullough was named Senior Vice
President of Sales and Marketing.
RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF EACH OF THE
NOMINEES FOR DIRECTOR.
EXECUTIVE COMPENSATION
The following table sets forth, for the Company's 2001 fiscal year, all
compensation awarded to, earned by or paid to the Company's former President and
Chief Executive Officer (the "Former CEO") and David Allen, who is acting in a
similar capacity as a CEO at fiscal year end, and the most highly compensated
executive officers of the Company other than the Former CEO and Mr. Allen who
were executive officers of the Company at the end of the fiscal year ended July
31, 2001 and whose salaries and bonus exceeded $100,000 (two individuals) with
respect to the fiscal year ended July 31, 2001.
SUMMARY COMPENSATION TABLE
---------------------------------------------------------------------------------------------------------------------
ANNUAL COMPENSATION LONG TERM COMPENSATION
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
NAME AND PRINCIPAL YEAR SALARY($) BONUS($) OTHER ANNUAL NUMBER OF ALL OTHER
POSITION ---- --------- ------- COMPENSATION OPTIONS COMPENSATION
-------- ($)(1) ------- ($)
----- ---
Jeffrey Conrad, 2001 $215,000 -- - -- --
Former President and Chief 2000 200,000 30,000 - 20,000 --
Executive Officer 1999 200,000 -- - -- --
12
David Allen (2), 2001 $161,000 -- - 10,000 --
Executive Vice 2000 153,000 15,000 - 25,000 --
President, Chief 1999 75,000 -- - -- --
Operating Officer,
Chief Financial
Officer and
Secretary
Jean E. Reynolds, 2001 $145,000 -- - -- --
Executive Vice 2000 137,500 7,000 - 10,000 --
President and 1999 130,000 -- - -- --
Publisher
Richard McCullough, 2001 $129,000 $ 20,000 - -- --
Senior Vice 2000 125,000 20,000 - 10,000 --
Presiden Sales and
Marketing (3)
(1) Perquisites and other personal benefits, securities or property to each
executive officer did not exceed the lesser of $50,000 or 10% of such
executive officer's salary and bonus.
(2) Mr. Allen's employment with the Company commenced February 1999.
(3) Mr. McCullough's employment with the Company commenced July 1999.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION VALUES
No options were exercised by the named executive officers during the
fiscal year ended July 31, 2001. The following table provides information
related to the number of options held by the named executive officers at fiscal
year end. There were 59,660 such options, of a total 191,332 exercisable
options, at year end which had an exercise price less than $3.49, which was the
closing price of the Common Stock on July 31, 2001 as reported on the NASDAQ
SmallCap market. Accordingly, as of July 31, 2001, these options were in the
money.
13
--------------------------------------------------------------------------------
NAME NUMBER OF SECURITIES UNDERLYING
UNEXERCISED OPTIONS AT FY-END
(#)
-------------------------------
EXERCISABLE UNEXERCISABLE
----------- -------------
Jeffrey Conrad ........................ 140,000 10,000
Jean E. Reynolds ...................... 35,499 0
David Allen ........................... 12,500 22,500
Richard McCullough .................... 3,333 6,667
EMPLOYMENT CONTRACTS WITH EXECUTIVE OFFICERS
The Company has entered into an employment agreement with Jean E.
Reynolds pursuant to which she is employed on a full-time basis as the Company's
Executive Vice President - Publisher. The term of the employment agreement
expires in September 2003. Ms. Reynolds annual base cash compensation under the
employment agreement is $145,000. Ms. Reynolds' base salary will be reviewed
annually by the Board of Directors. Ms. Reynolds has agreed not to compete with
the Company during the term of her employment agreement and for a period of two
years thereafter.
On February 1, 2001, the Company renewed the employment agreement with
David Allen pursuant to which he is employed on a full-time basis as the
Company's Chief Operating and Financial Officer. The term of the employment
contract expires February 1, 2003. Mr. Allen's annual base compensation under
the employment agreement is $160,000. For the fiscal year ended July 31, 2001,
Mr. Allen received no bonus. Mr. Allen has agreed not to compete with the
Company during the term of his employment agreement and for a period of one year
thereafter.
On June 1, 2001, the Company entered into an employment agreement with
Richard McCullough pursuant to which he is employed on a full-time basis as the
Company's Senior Vice President of Sales and Marketing. The term of the
employment contract expires June 1, 2002. Mr. McCullough's annual base
compensation under the employment agreement is $140,000. For the fiscal year
ended July 31, 2001, Mr. McCullough received a bonus of $20,000. Mr. McCullough
has agreed not to compete with the Company during the term of his employment
agreement and for a period of one year thereafter.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On December 16, 1999, the Company purchased 595,113 shares of Common
Stock in a private transaction from Wheatley, the beneficial owner of more than
5% of the outstanding shares of Common Stock of the Company, for an aggregate
price of $967,000 or $1.625 per share. Upon consummation of the transaction, the
repurchased shares of Common Stock were placed in treasury. The following
persons, or entities, who may be deemed to be the beneficial owners of more than
5% of the outstanding shares of Common Stock, are general partners or are
affilited with general partners of Wheatley: Barry Fingerhut, Irwin
14
Lieber, Barry Rubenstein, Applewood Capital, Jonathan Lieber and Seth Lieber.
There were no other transactions involving the Company and its
subsidiaries and its executive officers and/or Directors from August 1, 1998
which exceeded $60,000.
PROPOSAL II--RATIFICATION OF APPOINTMENT OF
INDEPENDENT AUDITORS
The Board of Directors appointed Arthur Andersen LLP, certified public
accountants, as the Company's independent auditors for the fiscal year ending
July 31, 2002. Although the selection of auditors does not require ratification,
the Board of Directors has directed that the appointment of Arthur Andersen LLP
be submitted to stockholders for ratification due to the significance of their
appointment to the Company. If stockholders do not ratify the appointment of
Arthur Andersen LLP, the Board of Directors will consider the appointment of
other certified public accountants. The approval of the proposal to ratify the
appointment of Arthur Andersen LLP requires the affirmative vote of a majority
of the votes cast by all shareholders represented and entitled to vote thereon.
An abstention, withholding of authority to vote or broker non-vote, therefore,
will not have the same legal effect as an "against" vote and will not be counted
in determining whether the proposal has received the required shareholder vote.
The Company's auditors for the fiscal year ended July 31, 2001 were
Arthur Andersen LLP.
AUDIT FEES
Arthur Andersen LLP billed the Company $55,000 for the following
professional services: audit of the Company's annual consolidated financial
statements for the fiscal year ended July 31, 2001 included in the Company's
annual report on Form 10-KSB and review of the Company's interim financial
statements included in the Company 's quarterly reports on Form 10-QSB for the
periods ended October 31, 2000, January 31, 2001 and April 31, 2001.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
Arthur Andersen LLP did not render any professional service related to
financial information systems design and implementation services for the fiscal
year ended July 31, 2001.
ALL OTHER FEES
Arthur Andersen LLP billed the Company $40,100 for other services
rendered during the fiscal year ended July 31, 2001. The audit committee has
considered whether the provision by Arthur Andersen LLP of the services covered
by the fees other than the audit fees is compatible with maintaining Arthur
Andersen LLP's independence and believes that it is compatible.
RECOMMENDATION
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR THE
RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE COMPANY'S
INDEPENDENT AUDITORS FOR THE YEAR ENDING JULY 31, 2002.
ANNUAL REPORT
All stockholders of record as of the Record Date, have been sent, or
are concurrently herewith being sent, a copy of the Company's 2001 Annual Report
for the year ended July 31, 2001, which contains certified financial statements
of the Company for the year ended July 31, 2001.
ANY STOCKHOLDER OF THE COMPANY MAY OBTAIN WITHOUT CHARGE A COPY OF THE
COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED JULY 31, 2001 (WITHOUT
EXHIBITS), AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, BY WRITING TO
DAVID ALLEN, CHIEF FINANCIAL OFFICER AND SECRETARY AT THE MILLBROOK PRESS INC.,
2 OLD NEW MILFORD ROAD, BROOKFIELD, CONNECTICUT 06804.
STOCKHOLDER PROPOSALS
In order to be considered for inclusion in the proxy materials to be
distributed in connection with the next Annual Meeting of Stockholders of the
Company, stockholder proposals for such meeting must be submitted to the Company
no later than July 7, 2002.
On May 21, 1998 the Securities and Exchange Commission adopted an
amendment to Rule 14a-4, as promulgated under the Securities and
15
Exchange Act of 1934, as amended. The amendment to Rule 14a-4(c)(1) governs the
Company's use of its discretionary proxy voting authority with respect to a
stockholder proposal which is not addressed in the Company's proxy statement.
The new amendment provides that if a proponent of a proposal fails to notify the
Company at least 45 days prior to the month and day of mailing of the prior
year's proxy statement, then the Company will be allowed to use its
discretionary voting authority when the proposal is raised at the meeting,
without any discussion of the matter in the proxy statement.
With respect to the Company's 2002 Annual Meeting of Stockholders, if
the Company is not provided notice of a stockholder proposal, which the
stockholder has not previously sought to include in the Company's proxy
statement, by September 20, 2002, the Company will be allowed to use its voting
authority as outlined above.
OTHER MATTERS
As of the date of this Proxy Statement, management knows of no matters
other than those set forth herein which will be presented for consideration at
the Meeting. If any other matter or matters are properly brought before the
Meeting or any adjournment thereof, the persons named in the accompanying Proxy
will have discretionary authority to vote, or otherwise act, with respect to
such matters in accordance with their judgment.
David Allen
SECRETARY
November 2, 2001
16
CHARTER OF THE AUDIT COMMITTEE
OF
THE BILLBROOK PRESS INC.
The Audit Committee of the Board of Directors of The Millbrook Press
Inc. (the "Corporation") (the "Committee") shall assist the Board of Directors
in fulfilling its oversight responsibilities with respect to the financial
reports and other financial information provided by the Corporation to the
stockholders and to the general public, the Corporation's internal controls, and
the Corporation's audit, accounting and financial reporting processes generally.
The Committee shall serve as an independent and objective monitor of the
performance of the Corporation's financial reporting process and system of
internal control; review and appraise the audit efforts of the Corporation's
independent accountants; and provide for open, ongoing communication among the
independent accountant, financial and senior management, and the Board of
Directors concerning the Corporation's financial position and affairs. The
Committee will report its actions to the Board of Directors with such
recommendations as the Committee may deem appropriate. The Committee shall be
governed in accordance with the By-Laws of the Corporation as well as have the
following powers and duties:
1. Structure and Composition. The Committee shall be composed of at
least three independent directors who are all capable of reading , understanding
and analyzing financial statements, or who will become financially literate
within a reasonable time after being appointed to the Committee. At least one
member of the Committee shall have past employment experience in finance or
accounting, or any comparable experience or background which results in that
committee member having financial sophistication. The members of the Committee
shall elect the Chairman (the "Chairman") from among themselves. The
independence of a director shall be determined in accordance with the rules and
regulations of the securities market where the Corporation's shares of Common
Stock are traded. The duties and responsibilities of a member of the Committee
are in addition to those duties generally pertaining to a member of the Board of
Directors.
2. General Financial Oversight. The Committee shall meet with the
independent accountants and the principal accounting officers of the Corporation
to ascertain that reasonable procedures and controls are followed to safeguard
the Corporation's assets and that adequate examinations are made to ensure the
reasonableness of the results reported in the financial statements for the
fiscal year. Specifically, the Committee shall:
o Review the financial information contained in the Corporation's
Quarterly Report on Form 10-QSB prior to its filing with the
Securities and Exchange Commission (the "SEC"), the Corporation's
earning announcement prior to release, and the results of the
independent accountant's review of Interim Financial Information
pursuant to SAS 71. The Chairman may represent the Committee, either
in person or by telephone conference call, for the purpose of this
review.
o Review with management and the independent accountants at the
completion of the annual audit and prior to filing the Corporation's
annual report on Form 10-KSB (the "Annual Report") with the SEC,
the accuracy and completeness of the following :
(i) the Corporation's financial statements included in
the Annual Report and related footnotes;
(ii) the independent accountant's audit of the financial
statements and their report;
(iii) any significant changes required in the
independent accountant's examination plan;
(iv) any serious difficulties or disputes with
management encountered during the course of the audit;
and
(v) other matters related to the conduct of the audit
which are to be communicated to the Committee under
generally accepted auditing standards, including
discussions relating to the independent accountants'
judgement about such matters as to the quality, not just
the acceptability, of the Corporation's accounting
practices and other items set forth in SAS 61
(Communications with Audit Committees) or other such
auditing standards that may in time modify, supplement
or replace SAS 61.
o The Committee will have prepared and reviewed the Audit Committee
Report for inclusion in the annual stockholder's meeting proxy
statement. The Committee must state whether it:
(i) has reviewed and discussed the audited financial
statements with management;
(ii) has discussed with the independent accountant the
matters required to be discussed by SAS 61, as may be
modified, supplemented or replaced;
(iii) has received the written disclosures from the
independent accountants required by Independence
Standards Board Standard No. 1 ("ISBS No. 1"), as may be
modified or supplemented, and has discussed with the
accountant their independence; and
(iv) has recommended to the Board of Directors, based on
the review and discussions referred to in above items
(i) through (iii), that the Corporation's financial
statements be included in the Annual Report on Form 10-K
for the
last fiscal year for filing with the SEC.
3. Selection of Independent Accountants. The Committee shall recommend
the firm of independent accountants to be nominated for the ensuing year at the
Board of Directors meeting when such action is taken.
o Before recommending a continuing independent accountant, the
Committee shall ensure the receipt for the year of, and review with
the independent accountant, a written statement required by ISBS
No.1, as may be modified or supplemented, and discuss their
continued independence with the accountant. The Committee will
recommend that the Board of Directors take appropriate action on any
disclosed relationships that may reasonably be brought to bear on
the independence of the accountants and satisfy itself that the
Corporation has engaged independent accountants as required by the
Securities Act of 1933,as amended.
o Together with the Board of Directors, the Committee shall submit
to the stockholders for ratification or rejection at the annual
meeting of stockholders the independent accountants selected.
4. Controls, Policies and Procedures Oversight. The members of the
Committee shall meet from time to time to review accounting policies followed,
changes therein, internal and accounting controls, and any issues that may be
raised by the independent accountants. At the discretion of the Chairman, the
principal accounting officers of the Corporation may be invited to attend the
meetings of the Committee with the independent accountants. The Committee may
request the independent accountants to report on the adequacy of their
examination, their views of the Corporation's internal controls, and on the
Corporation's compliance with accepted accounting principles adopted by the
accounting profession, as well as the effect of unusual or extraordinary
transactions. The Committee shall also be responsible for the following:
o Obtain the approval of the full Board of Directors of this Charter
and shall review and reassess this Charter as conditions dictate, at
least on annual basis;
o Periodically review the adequacy of the Corporation's accounting,
financial, and auditing personnel resources.
5. Advice; Legal Representation. The Committee is authorized to confer
with the Corporation's management and other employees to whom it may deem
necessary or appropriate to fulfill its duties. The Committee is authorized to
conduct or authorize investigations into any matter within the Committee's scope
of responsibilities. The Committee also is authorized to seek outside legal or
other advice to the extent it deems necessary or appropriate, provided it shall
keep the Board of Directors advised as to the nature and extent of such outside
advice.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
THE MILLBROOK PRESS INC.
Proxy - Annual Meeting of Stockholders
November 29, 2001
The undersigned, a stockholder of The Millbrook Press Inc., a Delaware
corporation (the "Company") does hereby appoint David Allen and Jean Reynolds,
and each of them, the true and lawful attorneys and proxies with full power of
substitution, for and in the name, place and stead of the undersigned, to vote
all of the shares of Common Stock of the Company which the undersigned would be
entitled to vote if personally present at the 2001 Annual Meeting of
Stockholders of the Company to be held at The Harmonie Club, 4 East 60th Street,
New York, New York 10022, on November 29, 2001, at 10:00 a.m. Local Time, or at
any adjournment or adjournments thereof.
The undersigned hereby instructs said proxies or their substitutes:
1. ELECTION OF DIRECTORS:
The election of the following directors: Howard Graham, Frank J. Farrell,
Bruno A. Quinson, Joseph Kanon and Hannah Stone to serve until the next
annual meeting of stockholders and until their successors have been duly
elected and qualified.
FOR WITHHOLD TO WITHHOLD AUTHORITY TO VOTE FOR
VOTE ANY NOMINEE(S), PRINT NAME(S) BELOW
-----------------------------------
2. RATIFICATION OF APPOINTMENT OF AUDITORS:
To ratify the appointment of Arthur Andersen LLP as the independent
auditors of the Company for the year ending July 31, 2002.
FOR AGAINST ABSTAIN
3. DISCRETIONARY AUTHORITY:
To vote with discretionary authority with respect to all other matters
which may come before the Meeting.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH ANY DIRECTIONS HEREINBEFORE GIVEN.
UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED TO ELECT DIRECTORS AND TO
RATIFY THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE COMPNAY'S INDEPENDENT
AUDITORS.
The undersigned hereby revokes any proxy or proxies
heretofore given, and ratifies and confirms that all
the proxies appointed hereby, or any of them, or their
substitutes, may lawfully do or cause to be done by
virtue hereof. The undersigned hereby acknowledges
receipt of a copy of the Notice of Annual Meeting and
Proxy Statement, both dated November 2, 2001, and a
copy of the Company's Annual Report on Form 10-KSB for
the year ended July 31, 2001.
Dated ____________________________________________ 2001
-------------------------------------------------------
