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 14a-12
GREENSTONE ROBERTS ADVERTISING, INC.
(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(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:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] 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:
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GREENSTONE ROBERTS ADVERTISING, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
GREENSTONE ROBERTS ADVERTISING, INC. (the "Company") will be held at 401
Broadhollow Road, Melville, New York 11747, on April 18, 2000 at 10:00 a.m., New
York time, for the following purposes:
1. To elect four members to the Board of Directors for a term of two
years and until their respective successors shall have been duly
elected and shall have qualified.
2. To approve the appointment of BDO Seidman LLP as auditors for the
Company's 2000 fiscal year.
3. To consider and act upon any other business as may properly be brought
before the meeting, and any adjournments or postponements thereof, in
connection with the foregoing or otherwise.
Shareholders of record at the close of business on March 6, 2000 will
be entitled to notice of and to vote at the meeting.
By order of the Board of Directors,
Anthony V. Curto
Secretary
Dated: Melville, New York
February 25, 2000
IF YOU DO NOT EXPECT TO BE PRESENT AT THE MEETING AND WISH YOUR SHARES
TO BE VOTED, PLEASE DATE, SIGN AND MAIL THE ACCOMPANYING FORM OF PROXY AS
PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE ADDRESSED TO THE COMPANY'S
TRANSFER AGENT.
GREENSTONE ROBERTS ADVERTISING, INC.
401 BROADHOLLOW ROAD
MELVILLE, NEW YORK 11747
PROXY STATEMENT
The accompanying proxy is solicited by the Board of Directors of
Greenstone Roberts Advertising, Inc., a New York corporation (the "Company"), on
behalf of the Company for use at the Annual Meeting of Shareholders to be held
at 401 Broadhollow Road, Melville, New York 11747, on April 18, 2000 at 10:00
a.m., New York time, and any adjournments or postponements thereof, at which
shareholders of record on March 6, 2000 will be entitled to vote. On March 6,
2000, the Company had outstanding 918,277 shares of Common Stock, par value $.01
per share (the "Common Stock"). The Common Stock is the only outstanding class
of voting securities of the Company. Each shareholder will be entitled to one
vote for each share of Common Stock held.
The costs of soliciting proxies will be borne by the Company. Such
costs will include charges by brokers and other custodians, nominees and
fiduciaries for forwarding proxies and proxy material to beneficial owners of
shares. Solicitation may be made by mail, personally, by telephone or telegraph,
by officers, directors and regular employees of the Company; such persons will
not be separately compensated for such solicitation.
The shares represented by an executed form of the accompanying proxy
will be voted as directed with respect to the election of Directors or, if no
direction is indicated, will be voted in favor of the election as Directors of
the nominees listed below. Each proxy executed and returned by a shareholder may
be revoked at any time thereafter except as to any matter or matters upon which,
prior to such revocation, a vote shall have been cast pursuant to the authority
conferred by such proxy. Subject to the foregoing, a shareholder may revoke his
proxy by executing another proxy at a later date, by notifying the Secretary of
the Company in writing of his revocation or by attending and voting at the
Annual Meeting.
If voting by proxy with respect to the election of Directors,
shareholders may vote in favor of all nominees, withhold their votes as to all
nominees or withhold their votes as to specific nominees. With respect to each
other proposal that comes before the shareholders at the Annual Meeting,
shareholders may vote For the proposal, vote Against the proposal or Abstain
from voting with respect to the proposal. Assuming a quorum is present, (i) the
affirmative vote of a plurality of the votes cast by the holders of the shares
of Common Stock entitled to vote will be required to act with respect to the
election of Directors and (ii) the affirmative vote of a majority of the votes
cast by the holders of the shares of Common Stock entitled to vote will be
required to act on all other proposals that come before the Annual Meeting.
Abstentions and broker non-votes (when a nominee holding shares for a beneficial
owner has not received voting instructions from the beneficial owner with
respect to a particular matter and such nominee does not possess or choose to
exercise discretionary authority with respect thereto) will be included in the
determination of the number of shares of Common Stock present at the meeting for
quorum purposes. However, abstentions and broker non-votes will not be included
in the tabulations of votes cast on proposals presented to shareholders.
There is being mailed herewith to each shareholder of record the
Company's Annual Report on Form 10-K without exhibits, for the fiscal year ended
October 31, 1999. The date of this Proxy Statement is the approximate date on
which the Proxy Statement and the accompanying form of proxy were first sent or
given to shareholders.
ITEM 1: ELECTION OF DIRECTORS
Four Directors are to be elected at the Annual Meeting, each Director
to hold office until the 2002 Annual Meeting of Shareholders and until his
respective successor shall have been duly elected and shall have qualified. The
Board of Directors has nominated the persons whose names appear below. It is the
intention of the persons named in the accompanying proxy to vote the proxies in
favor of the election of the nominees named below if no direction to the
contrary is given. The Board of Directors has no reason to believe that any of
those named will be unavailable. If any of those named should become
unavailable, discretionary authority is reserved to vote for a substitute.
The Directors are divided into two classes and hold office until the
second succeeding Annual Meeting of Shareholders following the election of their
respective class and the qualification of their successors. None of the officers
or Directors are related to one another.
INFORMATION AS TO NOMINEES FOR ELECTION AS DIRECTORS AT THE 2000 ANNUAL MEETING
FIRST
NAME AGE POSITION ELECTED
Ronald M. Greenstone............ 59 Chairman of the Board, Chief 1972
Executive Officer and
Director
Richard Projain................. 64 Director 1988
Monsignor Thomas J. Hartman..... 53 Director 1998
Victor F. Trizzino.............. 58 Director 1998
Ronald M. Greenstone founded the Company in 1972 and has been Chairman
of the Board of Directors, Chief Executive Officer and a Director for more than
the past five years. Mr. Greenstone served as President of the Company from
December 1988 to December 1991. Prior to founding the Company, Mr. Greenstone
served as Vice President in charge of account services for the former SH
Goldstein Advertising (Great Neck, New York).
Richard Projain has been a Principal of Kimba Consulting, Inc., a
management consulting firm since January 1994. Mr. Projain served as a freelance
consultant between November 1991 and December 1993. Mr. Projain was President,
Chief Executive Officer and Director of Electrosound Group, Inc. until October,
1991. In May, 1993 Electrosound Group, Inc. filed a petition for an order for
relief under Chapter 11 of the Bankruptcy Code. Electrosound was engaged in the
business of providing services and products to the recorded music industry.
Monsignor Thomas Hartman has been a Catholic priest with the Diocese
of Rockville Center for more than the past five years. Monsignor Hartman has
been the President and Chief Executive Officer of Radio and Television for the
Diocese of Rockville Center serving at Telicare, a cable television station,
located in Uniondale, New York since 1979. He is a Director with Haven Bancorp
Inc., a NASDAQ listed, bank holding company.
Victor F. Trizzino has been an independent management consultant since
July 1995. For more than five years prior thereto, he was President, Chief
Executive Officer and a Director of Standard Microsystems Corporation. Standard
Microsystems Corporation was engaged in the design, manufacture and marketing of
local area network products and of integrated circuits for the personal computer
market.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE NOMINEES
FOR ELECTION AS DIRECTORS.
INFORMATION AS TO DIRECTORS WHOSE TERMS EXPIRE AT THE 2001 ANNUAL MEETING
FIRST
NAME AGE POSITION ELECTED
Gary C. Roberts ......... 61 President and Director 1988
Anthony V. Curto ........ 63 Secretary and Director 1988
Gary C. Roberts has been President and Director of the Company since
January 1992. Mr. Roberts served as Executive Vice President since joining the
Company in January 1988. From January 1983 until December 1987, Mr. Roberts
served as Executive Vice President, Chief Operating Officer and Partner at
Slater Hanft Martin (a New York, New York based advertising agency). From
January 1970 to December 1982, Mr. Roberts served as Executive Vice President
and group head at Wells Rich Greene (a New York, New York based advertising
agency). Mr. Roberts received his Bachelor of Science degree in Marketing from
New York University in 1960.
Anthony V. Curto has been Secretary of the Company since August 25,
1994. Mr. Curto has been a partner with the law firm of Curto, Barton & Alesi,
P.C. which firm has been retained by the Company, since 1991. For more than 5
years prior thereto, he was a partner with the law firm of Meyer, Suozzi,
English & Klein, P.C. Mr. Curto is admitted to practice law in the State of New
York and obtained his J.D. degree from New York Law School in 1960. He has been
a Director and Counsel to Yoo Hoo, Inc. and C&C Corp. Mr. Curto also has been an
adjunct professor at the business school of Hofstra University.
COMPENSATION OF DIRECTORS
Each Director who is not an executive officer of the Company is paid
$1500 for each regular or special meeting of the Board of Directors attended.
Directors are not compensated for committee meetings attended.
At a meeting on January 26, 1998, the Board of Directors elected to
amend the Stock Option Plan to permit the granting of stock options to
non-employee directors. In addition, the Board of Directors voted to issue 4,000
shares of common stock to each of the non-employee directors. The fair value of
the options granted was not material. The Board also voted to grant to all
members of the Board of Directors who are not employees of the Company an
additional 2,000 options to purchase shares of stock of the Company on each
anniversary that such individual is a member of the Board of Directors.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company has established the following
committees:
(i) EXECUTIVE COMMITTEE -- the duties of the Executive Committee are
to exercise all functions of the Board of Directors in the intervals
between meetings of the Board of Directors. The members of the Executive
Committee during the Company's recently completed fiscal year were Messrs.
Greenstone, Projain and Roberts.
(ii) AUDIT COMMITTEE -- the duties of the Audit Committee include
recommending the engagement of independent auditors, reviewing and
considering actions of management in matters relating to audit functions,
reviewing with independent auditors the scope and result of their audit
engagement, reviewing reports from various regulatory authorities,
reviewing the system of internal controls and procedures, and reviewing the
effectiveness of procedures intended to prevent violations of law and
regulation. The members of the Audit Committee during the Company's
recently completed fiscal year were Messrs. Curto, Projain and Trizzino.
(iii) STOCK OPTION PLAN COMMITTEE -- the duties of the Stock Option
Plan Committee are to administer the Company's Option Plan (as defined
herein), including determining which employees of the Company and its
subsidiary will be granted options to purchase shares of Common Stock of
the Company and the number of shares of Common Stock subject to each option
granted. The members of the Stock Option Plan Committee during the
Company's recently completed fiscal year were Messrs. Curto, Projain and
Sussman.
(iv) COMPENSATION COMMITTEE -- the duties of the Compensation
Committee are to recommend to the Board remuneration for officers of the
Company, and to recommend the establishment of and monitor a compensation
and incentive program for all salaried personnel of the Company. In
addition, the Compensation Committee will review compensation paid to
non-employee shareholders of the Company owning at least 1% of the
outstanding Common Stock. The members of the Compensation Committee during
the Company's recently completed fiscal year were Messrs. Curto, Projain
and Trizzino.
MEETINGS OF DIRECTORS
During the fiscal year ended October 31, 1999, one meeting of the
Board of Directors, one meeting of the Audit Committee, one meeting of the
Compensation Committee, one meeting of the Stock Option Plan Committee and one
meeting of the Executive Committee were held. All Directors attended the meeting
of the Board held while he was a member, and no Director attended less than 75%
of the meetings held by all committees on which he served.
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Each of the Executive Officers of the Company is a Director of the
Company.
STOCK OWNERSHIP BY DIRECTORS, NOMINEES AND OFFICERS
The following table sets forth the number of shares of Common Stock of
the Company beneficially owned as of January 31, 2000, and the percentage of the
outstanding shares of Common Stock so held, by (i) each beneficial owner of more
than five percent of Common Stock, (ii) each person who is a Director or nominee
of the Company, (iii) each executive officer of the Company named in the Summary
Compensation Table set forth herein; and (iv) all Directors and executive
officers as a group. There were no other holders of 5% or more of the
outstanding shares of common stock. There were no stock options granted or
exercised in the last fiscal year.
NAME OF NUMBER OF SHARES PERCENTAGE
BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
- ------------------ ------------------ ----------
Ronald M. Greenstone............. 305,000 (1) 32%
Gary C. Roberts.................. 105,000 (2) 11%
Anthony V. Curto................. 8,000 (3) *
Richard Projain.................. 8,000 (3) *
Victor Trizzino.................. 2,000 (4) *
Thomas Hartman................... 4,000 (5) *
All Directors and executive officers as a group (5 persons). 44%
(1) Includes 25,000 shares of Common Stock which the holder has the right to
acquire within one year upon the exercise of options granted by the
Company.
(2) Includes 15,000 shares of Common Stock which the holder has the right to
acquire within one year upon the exercise of options granted by the
Company.
(3) Includes 8,000 shares of Common Stock which the holder has the right to
acquire within one year upon the exercise of options granted by the
Company.
(4) Includes 2,000 shares of Common Stock which the holder has the right to
acquire within one year upon the exercise of options granted by the
Company.
(5) Includes 4,000 shares of Common Stock which the holder has the right to
acquire within one year upon the exercise of options granted by the
Company.
* Less than 1%
NAME OF NUMBER OF SHARES PERCENTAGE
BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
- ------------------ ------------------ ----------
Herman Fialkov............... 175,000 (1) 19%
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(1) Shares of unregistered Common Stock acquired in a private placement in June
1999.
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors has furnished the
following report on executive compensation:
PHILOSOPHY
The fundamental philosophy of the Company's executive compensation
program is to offer competitive compensation opportunities which are based on
each individual executive officer's contribution and personal performance. The
compensation of the Company's executive officers is reviewed and approved by the
Compensation Committee which utilizes compensation analyses for similar type and
size agencies provided by the industry trade associations to ensure that the
compensation is both reasonable and competitive, and also is directly linked to
the Company's financial performance and shareholder interest.
There are three elements in the Company's executive compensation
program, as determined by individual and corporate performance.
- Base salary compensation is determined by the potential impact of
the individual on the Company's performance, the skill and
experience required by the job, and the performance and potential
of the incumbent in the job.
- Annual incentive compensation is based on corporate operating
earnings. Mr. Greenstone and Mr. Roberts each are eligible to earn
a bonus based on a percentage of the Company's profits before
provision for income tax.
- Long term incentive compensation consists of eligibility under the
Option Plan. Stock option grants are awarded based on individual
and Company performance.
Mr. Greenstone and Mr. Roberts also maintain a significant long-term
stock ownership position in the Company's Common Stock. This ownership position
creates a strong linkage between the Company's management and its shareholders'
interests.
THE COMPENSATION COMMITTEE
Anthony V. Curto
Richard Projain
Victor Trizzino
SUMMARY COMPENSATION TABLE
The following table sets forth for the Company's last three fiscal
years the compensation paid by the Company to its Chief Executive Officer and
President whose cash compensation exceeded $100,000 (the "Named Executive
Officers").
GREENSTONE ROBERTS ADVERTISING, INC.
EXECUTIVE COMPENSATION
Annual Compensation Long-Term Compensation
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Year Base Other Restricted All Other
Name and ended Salary1 Bonus Annual Stock LTIP Compensation2
Principal October 31, ($) ($) Compensation Awards Options Payouts ($)
Position
Ronald Greenstone 1997 296,563 -- -- -- -- -- 1,425
Chairman and CEO 1998 277,375 -- -- -- -- -- 1,500
1999 264,583 -- -- -- -- -- 1,500
Gary Roberts 1997 243,750 -- -- -- -- -- 1,425
President 1998 227,519 -- -- -- -- -- 1,500
1999 225,000 -- -- -- -- -- 1,500
1 The Named Executive Officers receive indirect compensation in the form of
automobile allowances, the use of automobiles and insurance payments on the
automobiles. The amount of such indirect compensation paid or distributed in
fiscal 1999 did not exceed, with respect to any named individual, the lesser
of $50,000 or 10% of the total annual compensation reported for such person.
2 Amounts represent contributions by the Company under the 401(k) savings plan.
EMPLOYMENT AGREEMENTS
Ronald Greenstone currently serves as Chairman and Chief Executive
Officer of the Company pursuant to the terms of an employment agreement which
expires on January 1, 2001. This agreement was entered into on January 1, 1998.
This agreement currently provides for an annual salary of no less than $275,000
and a cash bonus equivalent to 10% of the profit of the Company before provision
for income taxes. Mr. Greenstone voluntarily reduced his salary by $25,000 per
annum in August 1999.
Gary Roberts currently serves as President of the Company pursuant to
the terms of an employment agreement in which employment shall be on an "at
will" basis. This agreement was entered into on December 22, 1999. This
agreement currently provides for an annual salary of $225,000 and certain fringe
benefits, as defined. The Company or the employee may terminate such employee's
employment with 30 days written notice upon which time a lump sum payment of
$225,000 will be paid.
Each of the foregoing employment agreements restricts the respective
officer's ability to use or disclose confidential information related to the
business of the Company and to compete with the Company upon termination of his
employment by the Company.
In addition, each of the employment agreements provides that the
respective officer, upon termination of employment otherwise than for cause,
will receive a lump sum payment equal to such officer's annual salary, will
continue to receive such officer's annual salary for the remainder of the
employment period and will continue to be eligible for the Company's employee
benefits.
CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANTS.
At a meeting held on November 2, 1998, the Board of Directors of the
Company approved the engagement of BDO Seidman LLP as its independent auditors
for the fiscal year ending October 31, 1998 to replace the firm of Ernst & Young
LLP, who were dismissed as auditors of the Company effective November 2, 1998.
The report of Ernst & Young LLP on the Company's financial statements
for the fiscal year ended October 31, 1997, did not contain an adverse opinion
or a disclaimer of opinion and was not qualified or modified as to uncertainty,
audit scope, or accounting principles.
In connection with (i) the audit of the Company's financial statements
for the fiscal year ended October 31, 1997 and in the interim period from
October 31, 1997 through November 2, 1998 by Ernst & Young LLP there were no
disagreements with Ernst & Young LLP on any matters of accounting principles or
practices, financial statement disclosure, or auditing scope and procedures
which, if not resolved to the satisfaction of Ernst & Young LLP would have
caused Ernst & Young LLP to make reference to the matter in their report. The
Company requested Ernst & Young LLP to furnish it a letter addressed to the
Commission stating whether it agreed with the above statements. A copy of such
letter, dated November 9, 1998 is filed as Exhibit 1 to Form 8-K filed on
November 9, 1998.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's directors and officers to file with the Securities and
Exchange Commission (the "Commission") initial reports of ownership and reports
of changes in ownership of the Company's Common Stock. Copies of all such
Section 16(a) reports are required to be furnished to the Company. These filing
requirements also apply to holders of more than ten percent of the Company's
Common Stock.
To the Company's knowledge, based solely on review of the copies of
Section 16(a) reports furnished to the Company and written representations that
no other reports were required, during the fiscal year ended October 31, 1999,
all Section 16(a) filing requirements applicable to its officers, directors and
beneficial owners of ten percent or more of Common Stock were complied with,
except that Herman Fialkov filed a Form 3 on October 29, 1999 which was to be
filed by June 19, 1999.
ITEM 2: APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors of the Company has selected BDO Seidman LLP as
auditors of the Company and its subsidiary for the 2000 fiscal year. This firm
of independent public accounts has served the Company in this capacity since
1998. One or more representatives of BDO Seidman LLP are expected to be present
at the Annual Meeting of Shareholders and will have the opportunity to make a
statement if they desire to do so, and will also be available to respond to
appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
APPROVAL OF THE APPOINTMENT OF BDO SEIDMAN LLP AS AUDITORS OF THE COMPANY FOR
THE 2000 FISCAL YEAR.
ITEM 3: OTHER BUSINESS
As of the date of this Proxy Statement, the only business which the
Board of Directors intends to present, and knows that others will present, at
the Annual Meeting of Shareholders is set forth herein. If any other matter or
matters are properly brought before the Annual Meeting of Shareholders or any
adjournment or postponement thereof, it is the intention of the persons named in
the accompanying form of proxy to vote the proxy on such matters in accordance
with his judgment.
SHAREHOLDERS' PROPOSALS
Any proposal which a shareholder expects to present at the next Annual
Meeting of Shareholders must be received at the Company's principal executive
office shown on the first page of this Proxy Statement, Attention: Secretary,
not later than October 31, 2000 to be considered for inclusion in the proxy
material for the 2001 Annual Meeting of Shareholders.
* * *
THE COMPANY'S FORM 10-KSB FOR THE FISCAL YEAR ENDED OCTOBER 31, 1999
IS ENCLOSED HEREWITH TO SHAREHOLDERS AS AT MARCH 6, 2000. A SHAREHOLDER OWNING
SHARES BENEFICIALLY BUT NOT OF RECORD AS AT march 6, 2000, SHOULD REQUEST A
REPRESENTATION THAT SUCH SHAREHOLDER WAS A BENEFICIAL OWNER OF THE COMPANY'S
COMMON STOCK ON THAT DATE. SUCH REQUESTS SHOULD BE DIRECTED TO RONALD M.
GREENSTONE, CHAIRMAN, GREENSTONE ROBERTS ADVERTISING, INC., 401 BROADHOLLOW
ROAD, MELVILLE, NEW YORK 11747.