UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
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[_] Preliminary Proxy Statement [_] Confidential, for Use of the
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[X] Definitive Proxy Statement Rule 14a-6(e)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
ACCUSTAFF INCORPORATED
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Notes:
ACCUSTAFF INCORPORATED
ONE INDEPENDENT DRIVE
JACKSONVILLE, FLORIDA 32202
APRIL 14, 1998
DEAR ACCUSTAFF INCORPORATED SHAREHOLDER:
On behalf of the Board of Directors and management of AccuStaff
Incorporated, I cordially invite you to attend the annual meeting of
shareholders (the "Annual Meeting") to be held in the Auditorium in the
AccuStaff Building, One Independent Drive, Jacksonville, Florida on May 18,
1998 at 10:00 a.m. local time. The attached Notice of Annual Meeting and Proxy
Statement describe the formal business to be transacted at the Annual Meeting.
In addition to the specific matters to be acted upon, there also will be a
report on the operations of the Company. Directors and officers of the Company
will be present to respond to shareholders' questions.
It is important that your shares be represented at the Annual Meeting.
Regardless of whether you plan to attend, you are requested to mark, sign,
date and promptly return the enclosed proxy in the envelope provided. If you
attend the Annual Meeting, which we hope you will do, you may vote in person
even if you have previously mailed a proxy card.
Sincerely,
/s/ Derek E. Dewan
DEREK E. DEWAN,
Chairman of the Board of Directors,
President and Chief Executive
Officer
ACCUSTAFF INCORPORATED
ONE INDEPENDENT DRIVE
JACKSONVILLE, FLORIDA 32202
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 18, 1998
TO THE HOLDERS OF COMMON STOCK:
PLEASE TAKE NOTICE that the annual meeting of shareholders (the "Annual
Meeting") of AccuStaff Incorporated (the "Company") will be held on Monday,
May 18, 1998, at 10:00 a.m., local time, in the Auditorium in the AccuStaff
Building, One Independent Drive, Jacksonville, Florida.
The Annual Meeting will be held for the following purposes:
1. to elect six directors to serve terms scheduled to end in conjunction with
the next annual meeting of shareholders or until their successors are
elected and qualify; and
2. to transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
All shareholders are cordially invited to attend the Annual Meeting;
however, only shareholders of record at the close of business on March 24,
1998, are entitled to notice of and to vote at the Annual Meeting.
By Order of the Board of Directors,
/s/ Michael D. Abney
MICHAEL D. ABNEY,
SECRETARY
Dated: April 14, 1998
Jacksonville, Florida
REGARDLESS OF WHETHER YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE MARK,
SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED SELF-ADDRESSED
ENVELOPE AS PROMPTLY AS POSSIBLE.
ACCUSTAFF INCORPORATED
ONE INDEPENDENT DRIVE
JACKSONVILLE, FLORIDA 32202
PROXY STATEMENT FOR ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD MAY 18, 1998
INTRODUCTION
This Proxy Statement and the enclosed form of proxy are first being sent to
shareholders of AccuStaff Incorporated, a Florida corporation (the "Company"),
on or about April 14, 1998, in connection with the solicitation by the
Company's Board of Directors of proxies to be used at the annual meeting of
shareholders (the "Annual Meeting") of the Company to be held on Monday, May
18, 1998, at 10:00 a.m., local time, or at any adjournment thereof. The Annual
Meeting will be held in the Auditorium in the AccuStaff Building, One
Independent Drive, Jacksonville, Florida.
Only shareholders of record at the close of business on March 24, 1998 (the
"Record Date") will be entitled to notice of and to vote at the Annual Meeting
and any adjournments thereof. As of the Record Date, the Company had
outstanding 109,568,272 shares of Common Stock, par value $.01 per share (the
"Common Stock").
VOTING PROCEDURES
The Board of Directors has designated Derek E. Dewan and Michael D. Abney,
and each or either of them, as proxies to vote the shares of common stock
solicited on its behalf. If the enclosed form of proxy is executed and
returned, it may nevertheless be revoked at any time before it has been
exercised by: (i) giving written notice to the Secretary of the Company; (ii)
delivery of a later dated proxy; or (iii) attending the Annual Meeting and
voting in person. The shares represented by the proxy will be voted in
accordance with the directions given unless the proxy is mutilated or
otherwise received in such form as to render it illegible. If sufficient votes
in favor of the election of directors are not received by the date of the
Annual Meeting, the persons named as proxies may propose one or more
adjournments of the Annual Meeting to permit further solicitation of proxies.
The Company's Bylaws provide that a majority of shares entitled to vote and
represented in person or by proxy at a meeting of the shareholders constitutes
a quorum. The Company's Bylaws provide that directors are elected by a
plurality of the votes cast by the shares entitled to vote in the election at
a meeting at which a quorum is present. The Company's Bylaws further provide
that other matters are approved if affirmative votes cast by the holders of
the shares represented at a meeting at which a quorum is present and entitled
to vote on the subject matter exceed the votes opposing the action, unless a
greater number of affirmative votes or voting by classes is required by the
Florida Business Corporation Act or the Company's Articles of Incorporation.
Therefore, abstentions and broker non-votes generally have no effect under
Florida law. A broker non-vote occurs when a broker who holds shares in street
name for a customer does not have authority to vote on certain non-routine
matters under the rules of the New York Stock Exchange because its customer
has not provided any voting instructions on the matter.
Regarding the election of Directors, shares may be voted for or withheld
from each nominee. Abstentions and broker non-votes will have no affect on the
election of Directors.
Shareholders should specify their choices on the enclosed form of proxy. If
no specific instructions are given with respect to the matters to be acted
upon, the shares represented by a signed proxy will be voted "FOR" the
election of all nominees.
ELECTION OF DIRECTORS
At the Annual Meeting, six individuals will be elected to serve as directors
of the Company for terms scheduled to end in conjunction with the next annual
meeting of shareholders and until their successors are duly elected and
qualified. Each nominee is presently available for election and is a member of
the Board of Directors. If any nominee should become unavailable, which is not
now anticipated, the persons voting the accompanying proxy may in their
discretion vote for a substitute.
Information concerning the Board of Directors' nominees, based on data
furnished by them, is set forth below. There are no family relationships
between any directors or executive officers of the Company.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE ELECTION
OF EACH OF THE NOMINEES. PROXIES SOLICITED BY THE BOARD WILL BE SO VOTED
UNLESS SHAREHOLDERS SPECIFY IN THEIR PROXIES A CONTRARY CHOICE.
YEAR FIRST
BECAME
POSITIONS WITH THE COMPANY; DIRECTOR
PRINCIPAL OCCUPATIONS DURING OF THE
NAME (AGE) PAST FIVE YEARS; OTHER DIRECTORSHIPS COMPANY
--------------------- ------------------------------------------- ----------
Derek E. Dewan (43)+ President and Chief Executive Officer of 1994
the Company since January 1, 1994; Director
since January 28, 1994 (Chairman since
June 19, 1996); Partner with the accounting
firm of Coopers & Lybrand L.L.P. for more
than five years, prior to joining the
Company, most recently as the managing
partner of the Jacksonville, Florida
Office. Mr. Dewan currently serves on the
Board of Directors of the National
Association of Temporary and Staffing
Services ("NATSS") and on the Boards of
Transit Group, Inc., a publicly-held
trucking company, and Payroll Transfers,
Inc.
Daniel M. Doyle (57) Director of the Company since October 7, 1997
1997; Chief Executive Officer or President
of Danka Business Systems since 1977. Mr.
Doyle currently serves on the Board of
Directors of Tech Data Corporation,
Pinellas County Education Foundation, U.S.
Ski Team Foundation, Eckerd College, Tampa
Bay Partnership, Board of Fellows for
University of Tampa, Board of Trustees for
University of South Florida, Florida
Council of 100.
Peter J. Tanous (59) Director of the Company since August 15, 1997
1997; President of Lynx Investment
Advisory, Inc. since 1992. Mr. Tanous
currently serves on the Board of Directors
of Cedars Bank, a California State
commercial bank, Kistler Aerospace
Corporation, Interstate Resources, Inc.,
TechniFlite of America, Inc. Mr. Tanous was
formerly First Vice President and
International Regional Director with Smith
Barney, Harris Upham International and is a
noted author. His recent book, Investment
Gurus, received wide public acclaim.
T. Wayne Davis (51).+ Director of the Company since February 1994
1994; Private investor for the past five
years; President and Chairman of the Board
of Tine W. Davis Family-WD Charities, Inc.;
President of Red Wing Properties, Inc.; Of
Counsel to the Florida law firm of
Greenberg, Traurig, et al. (from 1990-
1995); Director of Enstar Group, Winn-Dixie
Stores, Inc., a publicly-held grocery
chain, Secured Document Systems, Inc. and
Associated Industries Insurance Services,
Inc. Mr. Davis also serves as Vice Chairman
of the Board of Riverside Golf Investments;
and Chairman of the Board of Transit Group,
Inc., a publicly held trucking company.
2
YEAR FIRST
BECAME
POSITIONS WITH THE COMPANY; DIRECTOR
PRINCIPAL OCCUPATIONS DURING OF THE
NAME (AGE) PAST FIVE YEARS; OTHER DIRECTORSHIPS COMPANY
---------------------------- ------------------------------------ ----------
John K. Anderson, Jr. (49).+ Director of the Company since 1996
November 7, 1996; currently is
Executive Vice President, Treasurer
and Chief Financial Officer of
American Heritage Life Investment
Corporation, a publicly-held
insurance holding company. Mr.
Anderson served as Chief Executive
Officer of E.G. Baldwin &
Associates, Inc., a regional
distributor of medical imaging
products and services from September
1993 to December 1995; Co-founder
and President of National Healthcare
Distribution, Inc. from January 1994
to December 1995; President and
Chief Executive Officer of Capitol
American Financial Corporation, a
publicly-held insurance holding
Company, from August 1990 to May
1993.
Michael D. Abney (62) Director of the Company since 1997
February 10, 1997, Secretary and
Treasurer; Senior Vice President of
the Company since March 1995 and
Chief Financial Officer of the
Company since joining the company in
November 1992. He is a certified
public accountant and was a partner
with Coopers & Lybrand, L.L.P. for
22 years prior to joining the
Company, most recently as managing
partner of Coopers & Lybrand
L.L.P.'s Jacksonville, Florida
office.
- --------
.Member of the Audit Committee.
+Member of the Compensation Committee.
BOARD OF DIRECTORS AND STANDING COMMITTEES. Regular meetings of the Board of
Directors are held approximately four times a year, with special meetings as
needed. During 1997, the Board of Directors held three regular meetings and
ten special meetings. Each director attended at least 75% of the aggregate of:
(i) all meetings of the Board of Directors and (ii) all meetings of Board
committees on which he served during 1997.
The Board of Directors has established two standing committees, an Audit
Committee and a Compensation Committee, which are described below. Members of
these committees are elected annually at the regular Board of Directors
meeting held in conjunction with the annual shareholders' meeting. The Board
of Directors presently does not have a nominating committee.
AUDIT COMMITTEE. The Audit Committee is presently comprised of Messrs.
Anderson (Chairman) and Davis, neither of whom is an officer of the Company.
The Audit Committee met once during 1997. The principal responsibilities of
and functions generally performed by the Audit Committee are reviewing the
Company's internal controls and the objectivity of its financial reporting,
making recommendations regarding the Company's employment of independent
auditors and reviewing the annual audit with the auditors.
COMPENSATION COMMITTEE. The Compensation Committee is presently comprised of
Messrs. Davis (Chairman), Dewan and Anderson. During 1997, the Compensation
Committee met three times. This Committee has the responsibility of approving
the compensation arrangements for senior management of the Company, including
annual bonus compensation. It also recommends to the Board of Directors
adoption of any
3
compensation plans in which officers and directors of the Company are eligible
to participate. Although a member of the Compensation Committee, Mr. Dewan
does not participate in any of the decisions regarding the terms of his
employment or compensation or the administration of the Company's stock option
plans.
PRINCIPAL SHAREHOLDERS AND SECURITIES
OWNERSHIP OF MANAGEMENT
The following table shows the beneficial ownership as of February 10, 1998
of (i) each director and nominee for director, (ii) the Named Executive
Officers, as defined below, (iii) those persons known to the Company to be
beneficial owners of more than 5% of its outstanding Common Stock and (iv) all
directors and executive officers as a group. Unless otherwise indicated, each
of the shareholders listed below exercises sole voting and dispositive power
over the shares.
SHARES BENEFICIALLY
OWNED
---------------------
NAME NUMBER PERCENT(1)
---- ---------- ----------
Derek E. Dewan(2)..................................... 1,553,767 1.45%
Walter W. Macauley.................................... 1,000,000 *
T. Wayne Davis(3)..................................... 220,067 *
John K. Anderson, Jr(4)............................... 12,700 *
Daniel M. Doyle....................................... 10,000 *
Peter J. Tanous....................................... 0 *
Michael D. Abney(5)................................... 557,340 *
James R. O'Reilly(6).................................. 453,102 *
Marc M. Mayo(7)....................................... 33,334 *
American Express Company(8)........................... 6,313,816 5.87
Putnam Investments, Inc.(9)........................... 7,927,259 7.37
Massachusetts Financial Services Company(10).......... 10,266,137 9.55
AMVESCAP PLC(11)...................................... 5,503,093 5.12
FMR Corp.(12)......................................... 9,639,387 8.97
All directors and executive officers as a group
(9 persons)(13)...................................... 3,839,610 3.57%
- --------
* Indicates less than 1%.
(1) Percentage is determined on the basis of 103,906,303 shares of Common
Stock outstanding as of February 10, 1998, plus shares of Common Stock
deemed outstanding pursuant to Rule 13d-3(d)(1) promulgated under the
Securities Exchange Act of 1934, as amended (the "1934 Act").
(2) Mr. Dewan owns or has options to acquire a total of 2,783,100 shares of
Common Stock, including the 1,553,767 shares shown in the table above. Mr.
Dewan's 2,783,100 shares consist of: (i) 100 shares held in his name; (ii)
1,553,667 shares held pursuant to options that are exercisable within 60
days of February 10, 1998; (iii) 276,000 shares of restricted stock, which
vest ratably over the next four years; (iv) 453,333 options that will vest
ratably over the next two years and (v) 500,000 options which will vest
ratably over the next three years.
(3) Mr. Davis beneficially owns or has options to acquire 325,400 shares of
Common Stock, including the 220,067 shares shown in the table above. Mr.
Davis' 325,400 shares consist of: (i) 130,000 shares held in his name;
(ii) 30,000 shares held by Tine W. Davis Family-WD Charities, Inc., a
foundation, over which Mr. Davis has sole voting and dispositive power;
(iii) 5,400 held in Mr. Davis' wife's name; (iv) 54,667 shares held
pursuant to options that are exercisable within 60 days of February 10,
1998; (v) options for 25,333 shares which will vest ratably over the next
two years; and (vi) options for 60,000 shares which will vest ratably over
the next three years.
(4) Mr. Anderson beneficially owns or has options to acquire 140,700 shares
of Common Stock, including the 12,000 shares shown in the table above.
Mr. Anderson's 140,700 shares consist of : (i) 700 shares held in his
name; (ii) 12,000 shares held pursuant to options that are exercisable
within 60 days of February 10, 1998; (iii) 68,000 options which will vest
ratably over the next two year; and (iv) options for 60,000 shares which
will vest ratably over the next three years.
4
(5) Mr. Abney owns or has options to acquire a total of 781,340 shares of
Common Stock, including 557,340 shares shown in the table above. Mr.
Abney's 781,340 shares consist of: (i) 31,340 shares held in his name;
(ii) 526,000 shares held pursuant to options that are exercisable within
60 days of February 10, 1998; and (iii) 92,600 options that will vest
ratably over the next two years and (iv) 100,000 options which will vest
ratably over the next three years.
(6) Mr. O'Reilly owns or has options to acquire a total of 527,102 shares of
Common Stock, including the 453,102 shares shown in the table above. Mr.
O'Reilly's 527,102 shares consist of: (i) 12,102 shares held in his
individual retirement account; (ii) 441,000 shares held pursuant to
options that are exercisable within 60 days of February 10, 1998; and
(iii) 74,000 options that will vest ratably over the next three years.
(7) Mr. Mayo has options to acquire a total of 250,000 shares of Common Stock,
including the 33,334 shares shown in the table above. Mr. Mayo's 100,000
shares consist of (i) 33,334 shares held pursuant to options that are
exercisable within 60 days of February 10, 1998; (ii) 66,666 options that
will vest ratably over the next two years and (iii) 150,000 shares which
will vest ratably over the next three years.
(8) Based on information the company obtained from American Express Company's
Schedule 13-G filed as of January 29, 1998. The business address of
American Express Company is American Express Tower, 200 Vesey Street, New
York, New York 10285. American Express Company reports to have shared
voting power for 399,016 shares of Common Stock and shared dispositive
power for 6,313,816 shares of Common Stock.
(9) Based on information the Company obtained from Putnum Investments, Inc.'s
Schedule 13-G filed as of January 20, 1998. The business address of Putnam
Investments, Inc. is One Post Office Square, Boston, Massachusetts 02109.
Putnam Investments, Inc. reports to have shared voting power for 438,300
shares of Common Stock and shared dispositive power for 7,927,259 shares
of Common Stock. These shares are held through its affiliates which report
that Putnam Investment Management, Inc. has shared dispositive power for
7,140,459 shares and The Putnam Advisory Company has shared voting power
for 438,300 shares of Common Stock and share dispositive power for 786,800
shares of Common Stock.
(10) Based on information the Company obtained from Massachusetts Financial
Services Company's Schedule 13-G filed as of January 20, 1998. The
business address of Massachusetts Financial Services Company is 500
Boylston Street, Boston, Massachusetts 02116. Massachusetts Financial
Services Company reports to have sole voting power for 10,225,030 shares
of Common Stock and sole dispositive power for 10,266,137 shares of
Common Stock. The 10,266,137 shares of Common Stock are held by
Massachusetts Financial Services Company and certain other affiliates
that include the MFS Series Trust II--MFS Emerging Growth Stock Fund.
(11) Based on information the Company obtained from AMVESCAP PLC's Schedule
13-G filed as of February 11, 1998. The business address of AMVESCAP PLC
is 11 Devonshire Square, London, EC2M 4YR, United Kingdom. AMVESCAP PLC
reports to have shared voting and dispositive power for 5,503,093 shares
of Common Stock. The 5,503,093 shares of Common Stock are held by the
following subsidiaries of AMVESCAP PLC: AVZ, Inc., AIM Management Group,
Inc., AMVESCAP Group Services, Inc., INVESCO, Inc., and INVESCO North
American Holdings, Inc.
(12) Based on information the Company obtained from FMR Corp.'s Schedule 13-G
filed as of February 9, 1998. The business address of FMR Corp is 82
Devonshire Street, Boston, MA 02109. FMR Corp. reports to have sole
voting power for 1,218,761 shares of Common Stock and sole dispositive
power for 9,639,387 shares of Common Stock. These shares are held through
various subsidiaries and affiliates of FMR Corp., including Fidelity
Management Research Company, an investment adviser to various investment
companies, Fidelity Management Trust Company, Fidelity International
Limited, Edward C. Johnson 3d and Abigail P. Johnson.
(13) Includes 3,620,668 held pursuant to options that are exercisable within
60 days of February 10, 1998.
5
Notwithstanding anything to the contrary as set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or
the Securities Exchange Act of 1934, as amended, that incorporate future
filings, including this Proxy Statement, in whole or in part, the following
Compensation Committee Report and the Comparative Stock Performance shall not
be incorporated by reference in to any such filings.
COMPENSATION COMMITTEE REPORT
The Company's overall compensation philosophy includes: attracting and
retaining quality executive talent; reinforcing strategic performance
objectives; and building goal congruence between the executive officers and
shareholders. Thus, there are three components to executive compensation: base
salary; incentive compensation; and equity participation.
BASE SALARY AND INCENTIVE COMPENSATION. In establishing the base salaries of
executive officers, attention is given to attracting and retaining quality
management. The Company looks to both the levels of compensation in the
staffing services industry and the marketplace for executives with similar
experience and abilities to determine the amount of base compensation. The
Company's intent with respect to base compensation, which has been established
pursuant to employment agreements in the case of Messrs. Dewan, O'Reilly,
Mayo, and Abney that are described elsewhere in this Proxy Statement, is to
set the level at or below the total compensation level of the industry and
marketplace to allow for stronger incentive compensation and equity
participation upon performance. The Chief Executive Officer's, Chief Operating
Officer's and Chief Financial Officer's bonuses are based on a percentage of
the year-to-year increase in the Company's pre-tax income. Other officers may
receive bonuses from time to time based on either the recommendation of the
CEO or the Board of Directors, tied to subjective as well as objective
performance criteria.
EQUITY PARTICIPATION. The Committee strongly believes that to encourage the
long-term growth of shareholders' value each executive officer must have some
form of equity participation. Thus, each of the executive officers
participates in stock ownership via either pre-existing ownership of stock or
via stock options (and in case of the Chief Executive Officer, via restricted
stock). During fiscal 1997, pursuant to the Company's stock plans, there were
option or stock grants for 100,000 shares of common stock to executive
officers and 2,352,176 shares of common stock were made to other employees.
CHIEF EXECUTIVE OFFICER. Although a member of the Committee, Mr. Dewan does
not participate in any of the decisions regarding the terms of his employment
or compensation. Mr. Dewan joined the Company on January 1, 1994. At such
time, the Company and Mr. Dewan entered into an employment agreement, which
provided that Mr. Dewan be compensated on a pay-for-performance basis. Since
his arrival, the Company has been able to grow revenues to approximately $2.4
billion in fiscal 1997 from approximately $498 million in fiscal 1993,
determined under the pooling-of-interests method of accounting, and increased
earnings per share approximately 1,063%. As reflected in the performance graph
included herein, the Company's stock has substantially outperformed both the
S&P 500 and the Company's industry peer group.
In January 1997, the Committee reviewed Mr. Dewan's compensation package and
determined that it reflected the objectives of the Committee and as such, Mr.
Dewan's base annual compensation of $350,000 was not changed for fiscal 1997.
Through the above described compensation, the Committee has sought to align
Mr. Dewan's compensation with the interests of the Company's shareholders. As
the Company's performance goals are met or
6
exceeded, resulting in increased value to shareholders, executives are
rewarded commensurately. In light of the contributions Mr. Dewan has made to
the Company, including the substantial increase in shareholder value during
his tenure with the Company, the Committee considers the amount of Mr. Dewan's
compensation for fiscal 1997 to be reasonable.
To the extent determinable and as one of the factors in its consideration of
compensation matters, the Compensation Committee considers the anticipated tax
treatment to the Company and to the executives of various payments and
benefits. Interpretations of and changes in the tax laws and other factors
beyond the Committee's control affect the deductibility of compensation.
Section 162(m) of the Internal Review Code of 1986, as amended (the "Code")
generally limits the corporate tax deduction for compensation paid to
executive officers named in the Summary Compensation Table to $1,000,000
unless certain requirements are met. The Committee believes that the Company's
1995 Stock Option Plan complies with Section 162(m) and, therefore, stock
options and stock appreciation rights ("SARs") granted under this plan would
qualify for the corporate tax deduction.
As it has done in the past, the Committee intends to design future
compensation awards for the executive officers subject to the deduction limit
so the corporate tax deduction is maximized without limiting the Committee's
flexibility to attract and retain qualified executives to manage the Company.
However, the Committee will not necessarily limit executive compensation to
that deductible under Section 162(m). The Committee will consider various
alternatives to preserving the deductibility of compensation payments and
benefits to the extent reasonably practicable and to the extent consistent
with its other compensation objectives.
The foregoing report has been furnished by:
ACCUSTAFF INCORPORATED
COMPENSATION COMMITTEE
T. Wayne Davis, Chairman
John K. Anderson, Jr.
Derek E. Dewan
7
COMPARATIVE STOCK PERFORMANCE
The following graph compares the cumulative total shareholder return on the
Company's Common Stock with the cumulative total return on the S&P 500 index
and the common stock of eight companies in the temporary staffing business, as
described below, for the period beginning August 16, 1994, the date that
trading first began on the Nasdaq National Market, and ending December 31,
1997 (the last trading date in the Company's 1997 fiscal year), assuming the
reinvestment of any dividends and assuming the investment of $100 in each. The
Company's Common Stock was traded on the Nasdaq National Market until November
15, 1996, at which time it commenced trading on the New York Stock Exchange
under the symbol ASI.
[GRAPH APPEARS HERE]
LEGEND
SYMBOL CRSP TOTAL RETURN INDEX FOR: 8/16/94 12/30/94 12/29/95 12/31/96 12/31/97
------ ---------------------------- ------- -------- -------- -------- --------
---------- AccuStaff Incorporated 100.0 117.6 752.9 1084.5 1180.7
... -- ... S&P 500 Stocks 100.0 99.9 137.4 169.4 226.2
- - - - - Self-Determined Temporary Staffing Peer Group 100.0 105.2 126.2 136.9 173.1
Companies in the Self-Determined Peer Group
INTERIM SERVICES INC KELLY SERVICES INC
MANPOWER INC WIS NORRELL CORP
OLSTEN CORP PERSONNEL MANAGEMENT INC
ROBERT HALF INTERNATIONAL INC
NOTES:
A.The lines represent monthly index levels derived from compounded
daily returns that include all dividends.
B.The indexes are reweighted daily, using the market capitalization on
the previous trading day.
C.If the monthly interval, based on the fiscal year-end, is not a
trading day, the preceding trading day is used.
D.The index level for all series was set to $100.0 on 08/16/94.
Total return calculations for the S&P 500 Stocks and the Self-Determined
Temporary Staffing Peer Group were prepared by the Center for Research in
Security Prices, The University of Chicago. The Self-Determined Temporary
Staffing Peer Group is composed of the stocks of certain companies selected by
the Company in the temporary staffing business, and includes the following
companies: Interim Services, Inc., Kelly Services, Inc., Manpower, Inc.,
Norrell Corp. GA, Olsten Corp., Personnel Management, Inc. and Robert Half
International, Inc. Career Horizons, Inc. is no longer included in the peer
group because it was merged into the Company during the 1996 fiscal year.
Additionally, Uniforce Temporary Personnel, Inc. is no longer included in the
peer group because it was acquired by another company during fiscal 1997.
Total returns were calculated based on cumulative total return, assuming the
value of the investment in the Company's Common Stock and in each index on
August 16, 1994 was $100 and that all dividends were reinvested. The indexes
are reweighted daily, using the market capitalization on the previous trading
day.
8
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid or accrued by the
Company for services rendered during the fiscal years indicated to the
Company's Chief Executive Officer and to the Company's four most highly
compensated executive officers who served the Company as executive officers
during 1997 and whose total salary and bonus exceeded $100,000 during the year
ended December 31, 1997 (the "Named Executive Officers"). The Company did not
grant any stock appreciation rights or make any long-term incentive plan
payouts during the periods shown.
SUMMARY COMPENSATION TABLE(1)
LONG-TERM
COMPENSATION AWARDS
-----------------------
ANNUAL COMPENSATION RESTRICTED SECURITIES
--------------------------- STOCK UNDERLYING ALL OTHER
YEAR SALARY BONUS AWARDS OPTIONS/SARS COMPENSATION
----- -------- ---------- ---------- ------------ ------------
Derek E. Dewan.......... 1997 350,000 3,903,720 -- -- 30,066
Chairman, President and 1996 350,000 1,092,640 4,887,500 1,700,000 42,678
Chief Executive 1995 250,000 376,331 -- 750,000 34,946
Officer(2)
Walter W. Macauley...... 1997 442,313 -- -- -- 108,986
Vice Chairman(3) 1996 57,693 450,000 -- 1,000,000 2,250,000
1995 -- -- -- -- --
Michael D. Abney........ 1997 200,000 681,948 -- -- --
Senior Vice President 1996 135,000 203,180 -- 390,000 --
and Chief Financial 1995 110,000 60,000 -- 300,000 --
Officer(4)
James R. O'Reilly....... 1997 200,000 331,948 -- -- --
Chief Operating 1996 150,000 203,180 -- 315,000 --
Officer(4) 1995 125,000 45,000 -- 300,000 --
Marc M. Mayo............ 1997 183,333 200,000 -- 100,000 5,346
Senior Vice President 1996 -- -- -- -- --
and General Counsel 1995 -- -- -- -- --
- --------
(1) All share amounts have been restated to reflect the Company's two-for-one
stock split effective November 27, 1995, and three-for-one stock split
effective March 27, 1996.
(2) Mr. Dewan's bonus is calculated as 4% of the year-to-year increase in the
Company's pre-tax income. The restricted stock amounts granted to Mr.
Dewan vest ratably over the next five years.
(3) Mr. Macauley resigned as Vice Chairman of the Company effective October 1,
1998.
(4) Mr. Abney and Mr. O'Reilly's bonuses for fiscal 1995 were calculated in
accordance with their employment agreements and were equal to 2% of the
year-to-year increase in the Company's pre-tax net income, provided,
however, the total bonus could not exceed $60,000 for Mr. Abney and
$45,000 for Mr. O'Reilly. For fiscal year 1996, both Mr. O'Reilly's and
Mr. Abney's employment agreements were renewed and the bonus formula
modified to reflect a fiscal 1996 bonus of approximately 0.75% of the
year-to-year increase in the Company's pre-tax income with no limitation
as to the total amount of the bonus. For fiscal year 1997, Mr. Abney's
employment agreement was renewed with the same bonus formula as in fiscal
year 1996.
9
OPTIONS GRANTED OR EXERCISED IN LAST FISCAL YEAR.
The following table sets forth information concerning each grant of stock
options to the Named Executive Officers during the year ended December 31,
1997.
OPTION GRANTS IN LAST FISCAL YEAR
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM(3)
--------------------------------------------------------------- -----------------------------
PERCENT OF TOTAL
NUMBER OF SECURITIES OPTIONS GRANTED TO EXERCISE OR
UNDERLYING OPTIONS EMPLOYEES IN FISCAL BASE PRICE EXPIRATION
NAME GRANTED YEAR (S/SH)(1) DATE 5% 10%
- ---- -------------------- ------------------- ----------- ---------- -------------- --------------
Marc M. Mayo............ 100,000 3.24% $18.875 1/14/2007 $ 1,187,039 $ 3,008,189
Derek E. Dewan.......... -- -- -- -- -- --
Michael D. Abney........ -- -- -- -- -- --
James R. O'Reilly....... -- -- -- -- -- --
Walter W. Macauley...... -- -- -- -- -- --
- --------
(1) All options were granted at the market value on the date of grant based
generally on the last sale price on the date of grant of the Company's
Common Stock.
(2) The dollar amounts under these calculations are the result of calculations
at the 5% and 10% rates set by the Securities and Exchange Commission and,
therefore, are not intended to forecast possible future appreciation, if
any, of the price of the Company's Common Stock or the present or future
value of the options.
The following table sets forth information regarding the number of options
exercised, the value realized on such exercises and the value of unexercised
options as of December 31, 1997, by each of the Named Executive Officers.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
---------------------------------------------------
NUMBER OF SECURITIES VALUE OF UNEXERCISED
NO. OF SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
ACQUIRED ON VALUE OPTIONS AT FISCAL YEAR END FISCAL YEAR END
NAME EXERCISE REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE(2)
- ---- ------------- ---------- -------------------------- ----------------------------
Derek E. Dewan.......... 383,000 $8,402,865 1,493,667 / 513,333 $14,143,810 / $1,530,000
Michael D. Abney........ 160,000 $3,289,821 514,000 / 136,000 $ 6,630,200 / $ 306,000
James R. O'Reilly....... 100,000 $2,245,500 429,000 / 86,000 $ 5,300,000 / $ 306,000
Walter W. Macauley...... -- -- 1,000,000 / -- -- / --
Marc M. Mayo............ -- -- -- / 100,000 -- / $ 412,500
- --------
(1) All share amounts have been restated to reflect the Company's two-for-one
stock split effective November 27, 1995, and three-for-one stock split
effective March 27, 1996.
(2) The closing price of the Company's Stock on the New York Stock Exchange on
December 31, 1997, the last trading day of the Company's fiscal year, was
$23.00
EMPLOYMENT AGREEMENTS
The Company has entered into an employment agreement with Derek E. Dewan,
the Company's President and Chief Executive Officer, that provides for an
annual base salary of $350,000 for fiscal 1998, plus incentive compensation
equal to 4% of the increase in the Company's pre-tax income for the fiscal
year over the previous fiscal year. If Mr. Dewan's employment is terminated by
the Company for reasons other than cause or by Mr. Dewan for good reason, the
agreement provides for any unvested options to become immediately exercisable
and for Mr. Dewan to receive a lump sum payment equal to the greater of: (i)
the present value of Mr. Dewan's base salary for the remaining portion of the
term of the employment agreement; or (ii) the present value of two
10
years' base salary. Any unvested options also will vest upon a change in
control. In addition, the employment agreement provides for Mr. Dewan to
receive a car allowance, life and disability insurance and Company-paid club
dues. Mr. Dewan's employment agreement expires on December 31, 2001.
Effective January 1, 1997, the Company agreed to renew for one year the
terms of the employment agreement of Michael D. Abney, the Company's Senior
Vice President and Chief Financial Officer, providing for an annual salary of
$200,000 plus incentive compensation of approximately 0.75% of the increase in
the Company's pre-tax income for the fiscal year over the previous fiscal
year. Pursuant to the agreement, if Mr. Abney is dismissed without cause, he
will receive one year's base salary. In the event of his death, disability or
termination without cause, or if there is a change in control of the Company,
the agreement provides for the automatic vesting of any unvested stock options
held by Mr. Abney on such date. The Company and Mr. Abney have continued to
comply with the terms of this agreement.
Effective February 1, 1997, the Company entered into a three year employment
agreement with Marc M. Mayo, the Company's Senior Vice President and General
Counsel, that provides for an annual base salary of $185,000, since adjusted
to $200,000, plus a discretionary incentive bonus. Pursuant to the agreement,
if Mr. Mayo is dismissed without cause, he will receive one year's base
salary. In the event of his death, disability or termination without cause, or
if there is a change in control of the Company, the agreement provides for the
automatic vesting of any unvested stock options held by Mr. Mayo on such date.
DIRECTOR'S COMPENSATION
FEES AND OTHER COMPENSATION. All directors, including inside directors,
receive from the Company a quarterly fee of $1,000, attendance fees of $1,500
per Board meeting, $500 for each Board Committee meeting and reimbursement for
their out-of-pocket expenses.
NON-EMPLOYEES DIRECTOR STOCK PLAN. Prior to the Company's initial public
offering in August 1994, the Board of Directors (excluding outside directors)
adopted, and the Company's shareholders approved, a stock option plan for non-
employee directors (the "Director Plan"). Subsequently, the Board of Directors
unanimously adopted and the shareholders approved certain amendments to the
Director Plan. A total of 1,600,000 shares of Common Stock are currently
reserved for issuance under the Director Plan. The Director Plan is
administered by the Director Stock Plan Committee which is comprised of
members of the Board of Directors who are not eligible to participate in the
Director Plan.
The Director Plan provides for the issuance of non-qualified options to
purchase 60,000 shares of Common Stock to each new non-employee director, upon
first being appointed or elected, at an exercise price equal to the fair
market value of the stock on the date of grant. The options become exercisable
ratably over a five-year period. The awards have a term of ten years but are
only exercisable for a maximum of three years after the participant ceases to
be a director of the Company; however, if a participant ceases to be a
director within one year of initial appointment or election, the options
granted shall be canceled.
In addition, the Director Plan provides for the annual issuance of non-
qualified options to purchase 20,000 shares of Common Stock to each director,
upon reelection, at an exercise price equal to the fair market value of the
stock on the date of grant. The options become exercisable ratably over a
three-year period. The Director Plan also permits the Board of Directors to
grant additional options to non-employee directors as the Board of Directors
may determine in its discretion.
11
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
The Compensation Committee, which was formed in fiscal 1994, is presently
comprised of Messrs. Davis, Anderson and Dewan. Mr. Dewan is President and
Chief Executive Officer of the Company and does not participate in decisions
relating to his compensation or the administration of the Company's Stock Plan
and 1995 Stock Option Plan.
Mr. Dewan serves on the Board of Directors of Transit Group, Inc. which acts
as the Compensation Committee for such company. Mr. Davis, the Chairman of the
Company's Compensation Committee, is the Chairman of the Board of Transit
Group, Inc.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Set forth below are various transactions involving the Company and former
directors or their related parties. The Audit Committee of the Board of
Directors is responsible for evaluating the appropriateness of all related-
party transactions.
Each of the four founding directors of the Company, Ms. Delores P. Kesler
(resigned from the Board, September 1997) and Messrs. Stephen A. Hoffmann
(resigned from the Board, February 1997), David G. Richardson (deceased,
September 1996) and William H. Thumel, Jr. (resigned from the Board, August
1997), previously entered into an Employment and Noncompetition Agreement with
the Company under which the director is prohibited, for a period of three
years following termination of the director's employment with the Company and
its affiliates, from, among other things, engaging in, lending money for the
benefit of, or rendering services for any competitive business within a 50-
mile radius of any office of the Company, and employing, for himself or on
behalf of any other person, within a 50-mile radius of any office of the
Company, any person employed by the Company or its affiliates during the
noncompete period. The business retained by each of the four founding
directors are generally excepted from the noncompete provisions.
Ms. Delores P. Kesler is the President and sole owner of ATS Services, Inc.
("ATS"), an affiliate of one of the predecessor companies. Since May 1992, the
Company has leased an office building, its former headquarters, from ATS under
a noncancellable lease which expired on January 1, 1996. The Company has not
formally entered into a new lease with ATS and has continued to make payments
and comply with the terms of the previous lease. During the year ended
December 31, 1997, the Company paid ATS an aggregate annual rent of
approximately $120,000.
Mr. William H. Thumel, Jr. is Chairman and 50% owner of Abacus Business
Services, Inc. ("Abacus"), an affiliate of one of the Company's four
predecessor companies. Abacus paid the Company approximately $1,128,105 in
fiscal 1997 for temporary staffing services provided to its beeper and paging
operations.
12
Mr. Thumel and Abacus of Hampton Roads, Inc., a company owned by Mr. Thumel,
lease space to the Company for branch office locations in Virginia pursuant to
certain noncancellable leases. During fiscal 1997, the Company paid aggregate
rent of approximately $4,645 under these leases.
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 executive officers and directors and persons who beneficially
own more than 10% of a registered class of the Company's equity securities, to
file reports of securities ownership and changes in such ownership with the
SEC. Officers, directors and greater than 10% beneficial owners also are
required by rules promulgated by the SEC to furnish the Company with copies of
all Section 16(a) forms they file. Based solely on review of the copies of
such reports furnished to the Company, the Company believes that, during the
last fiscal year, its executive officers, directors and greater than 10%
beneficial owners complied with all applicable Section 16(a) filing
requirements.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTS
The Company has selected the firm of Coopers & Lybrand L.L.P. to serve as
the independent certified public accountants for the Company for the current
fiscal year ending December 31, 1998. That firm has served as the auditors for
the Company since 1992. Representatives of Coopers & Lybrand L.L.P. are
expected to be present at the Annual Meeting and will be accorded the
opportunity to make a statement, if they so desire, and to respond to
appropriate questions.
OTHER MATTERS
The Board of Directors does not know of any other matters to come before the
Annual Meeting; however, if any other matters properly come before the Annual
Meeting it is the intention of the persons designated as proxies to vote in
accordance with their best judgment on such matters. If any other matter
should come before the Annual Meeting, action such matter will be approved if
the number of votes cast in favor of the matter exceeds the number opposed.
SHAREHOLDER PROPOSALS
Regulations of the Securities and Exchange Commission require Proxy
Statement to disclose the date by which shareholder proposals must be received
by the Company in order to be included in the Company's proxy materials for
the next annual meeting. In accordance with these regulations, shareholders
are hereby notified that if they wish a proposal to be included in the
Company's Proxy Statement and form of proxy relating to the 1999 annual
meeting, a written copy of their proposal must be received at the principal
executive offices of the Company no later than December 14, 1998. To ensure
prompt receipt by the Company, proposals should be sent certified mail return
receipt requested. Proposals must comply with the proxy rules relation to
shareholder proposals in order to be included in the Company's proxy
materials.
ANNUAL REPORT
A copy of the Company's Annual Report for the year ended December 31, 1997,
accompanies this Proxy Statement. Additional copies may be obtained by writing
to Michael D. Abney, Senior Vice President and Chief Financial Officer, at One
Independent Drive, Jacksonville, Florida 32202.
13
EXPENSES OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. The Company
does not expect to pay any compensation for the solicitation of proxies but
will reimburse brokers and other persons holding stock in their names, or in
the names of nominees, for their expenses for sending proxy material to
principals and obtaining their proxies. Certain officers and regular employees
of the Company or its subsidiaries, without additional compensation, may use
their personal efforts, by telephone or otherwise, to obtain proxies in
addition to solicitation by mail. Should the Company's management deem it
appropriate, the Company may also retain the services of Corporate
Communications, Inc. and/or Morrow & Co., Inc. to aid in the solicitation of
proxies for which the Company anticipates it will pay a fee not to exceed, in
the aggregate, $10,000 plus reimbursement of expenses.
Date: April 14, 1998
SHAREHOLDERS ARE URGED TO SPECIFY THEIR CHOICES, DATE, SIGN AND RETURN THE
ENCLOSED PROXY IN THE ENCLOSED ENVELOPE, POSTAGE FOR WHICH HAS BEEN PROVIDED.
YOUR PROMPT RESPONSE WILL BE APPRECIATED.
14
LOGO
ACCUSTAFF INCORPORATED
ONE INDEPENDENT DRIVE
JACKSONVILLE, FLORIDA 32202
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
KNOW ALL MEN BY THESE PRESENTS that I, the undersigned shareholder of
AccuStaff Incorporated, a Florida corporation (the "Company"), do hereby
nominate, constitute, and appoint Derek E. Dewan and Michael D. Abney, or any
one or more of them, my true and lawful attorney(s) with full power of
substitution for me and in my name, place and stead, to vote all of the Common
Stock, par value $.01 per share, of the Company, standing in my name on its
books on March 24, 1998, at the Annual Meeting of its Shareholders to be held
in the Auditorium in the AccuStaff Building, One Independent Drive,
Jacksonville, Florida on May 18, 1998, at 10:00 a.m., local time, or at any
adjournment thereof.
1. Election of the following nominees as directors:
Derek E. Dewan, Daniel M. Doyle, Peter J. Tanous,
T. Wayne Davis, John K. Anderson, Jr. and Michael D. Abney.
[_FOR]all [_]WITHHOLD AUTHORITY
nominees listed to vote for all
(except as marked to nominees listed
the contrary)
(INSTRUCTION: To withhold authority to vote for any individual nominee(s),
write that nominee's name(s) in the space provided below.)
- --------------------------------------------------------------------------------
(CONTINUED ON THE OTHER SIDE)
LOGO
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
This proxy, when properly execut-
ed, will be voted in the manner
directed herein by the under-
signed shareholder. Please sign
exactly as your name appears
herein. When shares are held by
joint tenants, both should sign.
When signing as attorney, execu-
tor, administrator, trustee or
guardian, please give full title
as such. If a corporation, please
sign in full corporate name by
president or other authorized of-
ficer. If a partnership please
sign in partnership name by au-
thorized person. Make sure that
the name on your stock certifi-
cate(s) is exactly as you indi-
cate below.
----------------------------------
Signature
----------------------------------
Signature if jointly held
Dated: ____________________ , 1998
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING
THE ENCLOSED SELF-ADDRESSED ENVELOPE.