SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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Check the appropriate box:
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/X/ Definitive Proxy Statement
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ACNielsen Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
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[LOGO]ACNielsen
177 Broad Street, Stamford, CT 06901
March 11, 1997
Dear Shareholder:
You are invited to attend the 1997 Annual Meeting of Shareholders of
ACNielsen Corporation on Wednesday, April 16, 1997 at 9:30 A.M. at 1209 Orange
Street, Wilmington, Delaware. This will be the first Annual Meeting of the
Company since the distribution by The Dun & Bradstreet Corporation of the
Company's shares on November 1, 1996 and we are delighted to have this
opportunity to review the Company's progress with you. In addition, we will
consider and vote upon the matters outlined in the attached Notice of Annual
Meeting and Proxy Statement. The Annual Report for the year ended December 31,
1996 also is enclosed.
Your vote is important. Accordingly, whether or not you plan to attend the
meeting, please ensure that your shares are represented by completing and
returning the accompanying proxy card.
Sincerely,
/s/ NICHOLAS L. TRIVISONNO
--------------------------------
NICHOLAS L. TRIVISONNO
Chairman and Chief Executive Officer
[LOGO]ACNielsen
177 Broad Street, Stamford, CT 06901
NOTICE OF ANNUAL MEETING
The Annual Meeting of Shareholders of ACNielsen Corporation will be held
on Wednesday, April 16, 1997 at 9:30 A.M. at 1209 Orange Street, Wilmington,
Delaware, to take action on the following matters:
1. To elect four Class I directors for a three-year term.
2. To consider and vote upon the ratification of the selection of
independent public accountants to audit the Company's consolidated
financial statements for 1997.
3. To consider and vote upon the approval of the Company's 1996 Key
Employees' Stock Incentive Plan.
4. To consider and vote upon the approval of the Company's 1996
Senior Executive Incentive Plan.
5. To transact such other business as may properly come before the
meeting or any adjournment thereof. The Company knows of no other business
to be brought before the meeting.
The Board of Directors has fixed the close of business on February 20,
1997 as the record date for determination of Shareholders entitled to notice of,
and to vote at, the meeting.
By Order of the Board of Directors,
/s/ ELLENORE O'HANRAHAN
ELLENORE O'HANRAHAN, Secretary
Dated: March 11, 1997
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of ACNielsen Corporation ("ACNielsen" or the "Company")
of proxies for the Annual Meeting of Shareholders to be held on April 16, 1997.
These proxy materials are being mailed to Shareholders commencing approximately
March 11, 1997.
The principal executive offices of ACNielsen are located at 177 Broad
Street, Stamford, Connecticut 06901 and its telephone number is (203) 961-3000.
SPIN-OFF FROM DUN & BRADSTREET
The Company began operating as an independent, publicly-held company on
November 1, 1996 (the "Spin-Off Date") as a result of its spin-off (the
"Spin-Off") on that date from The Dun & Bradstreet Corporation ("Dun &
Bradstreet"). Prior to the Spin-Off, the Company operated as a wholly-owned
business of Dun & Bradstreet.
VOTING AND REVOCABILITY OF PROXIES
Your vote is important and the Board of Directors urges you to exercise
your right to vote.
Sending in a signed proxy will in no way limit your right to vote at the
Annual Meeting if you later decide to attend in person. Any Shareholder giving a
proxy has the right to revoke it at any time before it is exercised by executing
and returning a proxy bearing a later date, by giving written notice of
revocation to the Secretary of ACNielsen, or by attending the meeting and voting
in person. Proxies must be filed with the secretary of the meeting prior to or
at the commencement of the Annual Meeting. All properly executed proxies not
revoked will be voted at the meeting in accordance with the instructions
contained therein. A proxy which is signed and returned by a Shareholder of
record without specification marked in the instruction boxes will be voted, as
to proposals specified in the proxy, in accordance with the recommendations of
the Board of Directors as outlined in this Proxy Statement. If any other
proposals are brought before the meeting and submitted to a vote, all proxies
will be voted in accordance with the judgment of the persons voting the
respective proxies.
The preceding paragraph does not apply to shares held in a participant's
account in (i) the ACNielsen Corporation Employee Stock Ownership Plan (the
"ESOP"), (ii) the ACNielsen Corporation Savings Plan (the "Savings Plan"), (iii)
the Dun & Bradstreet Profit Participation Plan, (iv) the DonTech Profit
Participation Plan, and (v) the Cognizant Corporation Savings Plan. For a
participant in the ESOP and for a participant in the other plans who has
contributions invested in ACNielsen Common Stock, the trustee of such plans has
agreed that the proxy will serve as a voting instruction for the trustee. The
proxy will also serve as a proxy for any shares registered in the participant's
own name. Proxies covering shares in the plans must be received prior to April
9, 1997. If a proxy covering shares in the ESOP or Savings Plan has not been
received prior to April 9, 1997 or if it is signed and returned without
specification marked in the instruction boxes, the trustee of those plans will
vote those plan shares in the same proportion as the respective shares in such
plan for which it has received instructions, except as otherwise required by
law. Shares held by other plans and not voted by participants will be voted in
accordance with the terms of those plans.
RECORD DATE
The Board of Directors has fixed the close of business on February 20,
1997 as the record date (the "Record Date") for the determination of the
Shareholders entitled to receive notice of, and to vote at, the Annual Meeting.
The only outstanding equity or voting securities of ACNielsen are shares of
Common Stock, par value $0.01 per share. Only holders of record of shares of
Common Stock as of the Record Date will be entitled to vote at the meeting. As
of the close of business on February 20, 1997, ACNielsen had outstanding
56,922,427 shares of Common Stock. Each such share will be entitled to one vote.
1
PROXY SOLICITATION
In connection with proxy soliciting material mailed to Shareholders,
employees of ACNielsen may communicate with Shareholders personally or by
telephone, facsimile or mail to solicit their proxies. ACNielsen also has
retained the firm of Georgeson & Company Inc. to assist in the solicitation of
proxies for a fee estimated at $10,000 plus expenses. ACNielsen will pay all
expenses related to such solicitations of proxies. ACNielsen and Georgeson &
Company Inc. will request banks and brokers to solicit proxies from their
customers where appropriate and will reimburse them for reasonable out-of-pocket
expenses.
QUORUM AND VOTING REQUIREMENTS
ACNielsen's by-laws provide that the holders of a majority in voting power
of the stock issued and outstanding and entitled to vote thereat, present in
person or represented by proxy, shall constitute a quorum at the Annual Meeting.
Abstentions and broker "non-votes" are counted as present and entitled to vote
for purposes of determining a quorum. A broker "non-vote" occurs when a nominee
holding shares for a beneficial owner does not vote on a particular proposal
because the nominee does not have discretionary voting power with respect to
that item and has not received instructions from the beneficial owner.
Directors shall be elected by the holders of a plurality of the voting
power present in person or represented by proxy and entitled to vote.
Abstentions and broker "non-votes" shall not be counted for purposes of the
election of directors. Approval of each of the 1996 Key Employees' Stock
Incentive Plan and the 1996 Senior Executive Incentive Plan shall require
approval by a majority of the votes cast on the matter and abstentions and
broker "non-votes" shall not affect the result.
SECURITY OWNERSHIP OF MANAGEMENT AND OTHERS
The following table sets forth the number of shares of ACNielsen Common
Stock beneficially owned by each of the directors, each of the executive
officers named in the Summary Compensation Table below, and all present
directors and executive officers of ACNielsen as a group, at February 28, 1997.
The table also sets forth the name and address of the only persons known to
ACNielsen to be the beneficial owners (the "Owners") of more than five percent
of the outstanding Common Stock and the number of shares so owned, to
ACNielsen's knowledge, on December 31, 1996 (or, in the case of FMR Corp.,
Edward C. Johnson 3d and Abigail P. Johnson (collectively, the "Fidelity
Group"), January 31, 1997). Such information is based upon information furnished
by each such person or, in the case of each Owner, based upon a Schedule 13G
filed by such Owner with the Securities and Exchange Commission ("SEC"). It
should be noted that in certain cases shares required under rules of the SEC to
be shown as beneficially owned are shares to which the indicated person holds
only rights to acquire within 60 days through exercise of stock options. Shares
owned by the executive officers named in the Summary Compensation Table include
shares purchased on the open market. Unless otherwise stated, the indicated
persons have sole voting and investment power over the shares listed. All
directors and executive officers as a group beneficially own less than 1% of the
Common Stock.
NAME NUMBER OF SHARES AND NATURE OF OWNERSHIP
---- ----------------------------------------
Robert H. Beeby .................. 1,000 Indirect (1)
1,904 Restricted Stock Grant (2)
---------
2,904
Robert J. Chrenc ................. 20,523* Direct
188 Held through ESOP plan (3)
---------
20,711
2
NAME NUMBER OF SHARES AND NATURE OF OWNERSHIP
---- ----------------------------------------
Michael P. Connors ............... 29,538* Direct
202 Held through ESOP plan (3)
86 Held through 401(k) plan (4)
24,287 Right to Acquire Within 60 Days
--------- by Exercise of Options (5)
54,113
Earl H. Doppelt .................. 21,702* Direct
202 Held through ESOP plan (3)
80,861 Right to Acquire Within 60 Days
--------- by Exercise of Options (5)
102,765
Donald W. Griffin ................ 1,904 Restricted Stock Grant (2)
Thomas C. Hays ................... 2,000 Direct
1,904 Restricted Stock Grant (2)
---------
3,904
Karen L. Hendricks ............... 2,000 Direct
1,904 Restricted Stock Grant (2)
---------
3,904
Robert M. Hendrickson ............ 1,000 Direct
1,904 Restricted Stock Grant (2)
---------
2,904
Robert Holland, Jr. .............. 1,000 Direct (6)
2,042 Restricted Stock Grant (2)
---------
3,042
Robert J Lievense ................ 37,050* Direct (7)
256 Held through ESOP plan (3)
107,097 Right to Acquire Within 60 Days
--------- by Exercise of Options (5)
144,403
John R. Meyer..................... 1,132 Direct (8)
1,904 Restricted Stock Grant (2)
---------
3,036
Brian B. Pemberton................ 500 Direct
1,904 Restricted Stock Grant (2)
---------
2,404
Robert N. Thurston................ 2,000 Direct
1,904 Restricted Stock Grant (2)
---------
3,904
Nicholas L. Trivisonno............ 65,607* Direct
296 Held through ESOP plan (3)
484 Held through 401(k) plan (4)
22,536 Right to Acquire Within 60 Days
--------- by Exercise of Options (5)
88,923
All Directors and Executive
Officers as a Group.............. 438,821 (9)
3
NAME NUMBER OF SHARES AND NATURE OF OWNERSHIP
---- ----------------------------------------
The Capital Group
Companies, Inc. and its
subsidiary, Capital Research
and Management Company,
333 South Hope Street,
Los Angeles, CA 90071 ....... 6,402,230 (10)(11)
FMR Corp., Edward
C. Johnson 3d and
Abigail P. Johnson,
82 Devonshire Street,
Boston, MA 02109 ............ 7,093,588 (12)(13)
Harris Associates L.P. and its
sole general partner,
Harris Associates, Inc.,
Two North LaSalle Street,
Suite 500,
Chicago, IL 60602 ........... 7,370,074 (14)(15)
- ----------
* Includes purchases on the open market on November 4, 1996, the first day
of regular way trading in the Company's Common Stock, in the amount of
45,607 shares in the case of Mr. Trivisonno, 28,504 shares in the case of
Mr. Lievense, 28,504 shares in the case of Mr. Connors, 20,523 shares in
the case of Mr. Doppelt and 20,523 shares in the case of Mr. Chrenc. Also
includes purchases on the open market during the week commencing February
24, 1997 in the amount of 20,000 shares in the case of Mr. Trivisonno and
7,500 shares in the case of Mr. Lievense.
(1) Represents shares held by spouse as to which the named person has shared
voting and shared investment power.
(2) Represents shares of restricted stock granted under the Non-Employee
Directors' Stock Incentive Plan.
(3) Represents shares held through the ACNielsen Employee Stock Ownership
Plan.
(4) Represents shares held through the ACNielsen Savings Plan, a 401(k) plan.
(5) Substitute Options (as defined below) that are exercisable within 60 days
of February 28, 1997.
(6) Shares owned jointly with spouse and as to which the named person has
shared voting power and shared investment power.
(7) Includes 7,533 shares held in the Robert J Lievense IRA.
(8) 832 of these shares are owned jointly with spouse and as to which the
named person has shared voting power and shared investment power.
(9) Includes all shares beneficially owned, regardless of nature of ownership,
and all rights to acquire shares within 60 days.
(10) Represents 11.26% of the total outstanding Common Stock on December 31,
1996.
(11) The Capital Group Companies, Inc. ("CGCI") and its wholly-owned
subsidiary, Capital Research and Management Company ("CRMC"), have jointly
filed a Schedule 13G with the SEC reporting that, as of December 31, 1996,
CGCI had sole voting power over 1,870,400 shares of the Company's Common
Stock and sole dispositive power over 6,402,230 shares, and CRMC had sole
dispositive power over 3,893,660 shares.
(12) Represents 12.47% of the total outstanding Common Stock on January 31,
1997.
(13) FMR Corp., Edward C. Johnson 3d and Abigail P. Johnson have jointly filed
a Schedule 13G with the SEC reporting that they had, as of January 31,
1997, sole dispositive power over 7,093,588 shares of the Company's Common
Stock and that FMR Corp. also had sole voting power over 257,227 shares.
(14) Represents 12.96% of the total outstanding Common Stock on December 31,
1996.
(15) Harris Associates L. P. and its sole general partner, Harris Associates,
Inc., have jointly filed a Schedule 13G with the SEC reporting that they
had, as of December 31, 1996, shared voting power over 7,370,074 shares of
the Company's Common Stock, sole dispositive power over 2,472,916.74
shares and shared dispositive power over 4,897,157.26 shares.
4
ELECTION OF DIRECTORS
The members of the Board of Directors of ACNielsen are classified into
three classes, one of which is elected at each Annual Meeting of Shareholders to
hold office for a three-year term and until successors of such class are elected
and have qualified.
The Board of Directors has nominated Messrs. Donald W. Griffin, Robert M.
Hendrickson, Brian B. Pemberton and Nicholas L. Trivisonno for election as Class
I Directors at the 1997 Annual Meeting for a three-year term expiring at the
2000 Annual Meeting of Shareholders. All of the nominees were elected directors
in 1996 prior to, and in anticipation of, the Spin-Off. The nominees comprise
all current Class I Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION AS DIRECTORS
OF THE NOMINEES LISTED ABOVE.
Except where otherwise instructed, proxies will be voted for election of
all the nominees, all of whom are now members of the Board. In the event, which
is not now anticipated, that any of such nominees should become unavailable to
serve for any reason, shares for which proxies have been received will be voted
for a substitute nominee unless the number of directors constituting the full
Board and Class I is reduced.
Set forth below is the principal occupation of, and certain other
information regarding, the nominees and other Directors whose terms of office
will continue after the Annual Meeting. With respect to Mr. Beeby, in 1992, when
he had been with Service America Corporation ("SAC") as acting Chief Executive
Officer for two months, SAC filed a voluntary petition for reorganization under
Chapter 11 of the U.S. Bankruptcy Code.
5
NOMINEES FOR CLASS I DIRECTORS FOR TERMS EXPIRING AT THE 2000 ANNUAL MEETING
POSITIONS WITH DIRECTOR PRINCIPAL OCCUPATION OTHER
NAME ACNIELSEN SINCE DURING LAST FIVE YEARS AGE DIRECTORSHIPS
---- --------- ----- ---------------------- --- -------------
Donald W. Griffin Director 1996 Chairman, President and 60 Olin Corporation;
Chief Executive Officer, Rayonier Inc.;
Olin Corporation Rayonier Forest
(manufacturer of chemicals, Products Company.
metals and ammunition), 4/96
to present; President and
Chief Executive Officer,
1/96 to 4/96; President and
Chief Operating Officer,
2/94 to 12/95; Vice Chairman
- Operations, 1/93 to 2/94;
Executive Vice President,
10/87 to 1/93.
Robert M. Director 1996 President, Juno Capital 67
Hendrickson Partners Ltd. (corporate
finance and investment
management consulting),
4/88 to present; Chairman,
Juno Land Investment
Corporation (residential
real estate development),
1/90 to present;
President, Juno Land
Development Corporation
(commercial real estate
development), 7/96 to
present.
Brian B. Pemberton Director 1996 Business consultant, 1/97 to 52
present; President - Skycell
Services, American Mobile
Satellite Corporation
(mobile communications),
8/96 to 12/96; President and
Chief Executive Officer,
4/95 to 8/96; President,
4/90 to 4/95.
Nicholas L. Chairman, Chief 1996 Chairman and Chief Executive 49 Rayonier Inc.; Yankee
Trivisonno Executive Officer Officer, ACNielsen, 5/96 to Energy System, Inc.
and Director present; Executive Vice
President - Finance and
Chief Financial Officer, Dun
& Bradstreet (business
information), 9/95 to 11/96;
Executive Vice President -
Strategic Planning and Group
President, GTE Corporation
(telecommunications), 10/93
to 7/95; Senior Vice
President - Finance, 1/89 to
10/93; director, 4/95 to 7/95.
6
CLASS II DIRECTORS HOLDING OFFICE FOR TERMS EXPIRING AT THE 1998 ANNUAL MEETING
POSITIONS WITH DIRECTOR PRINCIPAL OCCUPATION OTHER
NAME ACNIELSEN SINCE DURING LAST FIVE YEARS AGE DIRECTORSHIPS
---- --------- ----- ---------------------- --- -------------
Robert H. Beeby Director 1996 Business consultant; 65 Applied Extrusion
Non-Executive Technologies, Inc.;
Chairman, Service America Church & Dwight Co.,
Corporation (food service Inc.; Columbia Gas
operations), 9/91 to 1/97; System, Inc.
acting Chief Executive
Officer, 9/92 to 2/93.
Thomas C. Hays Director 1996 Chairman and Chief Executive 61 American Brands, Inc.
Officer, American Brands,
Inc. (consumer products),
1/95 to present; President
and Chief Operating Officer,
1/88 to 12/94.
Robert J Lievense President, Chief 1996 President and Chief 51
Operating Officer Operating Officer,
and Director ACNielsen, 5/96 to present;
Executive Vice President,
Dun & Bradstreet (business
information), 2/95 to
11/96; Senior Vice
President, 7/93 to 2/95;
Chairman, Dataquest
Incorporated (technology
information), 9/91 to
7/93; President, NCH
Promotional Services, Inc.
(coupon processing), 8/90
to 7/93.
John R. Meyer Director 1996 Professor Emeritus, Harvard 69 Dun & Bradstreet;
University, 1/97 to present; Union Pacific
Professor, Harvard Corporation; The
University, 7/73 to 12/96. Mutual Life Insurance
Company of New York.
7
CLASS III DIRECTORS HOLDING OFFICE FOR TERMS EXPIRING AT THE 1999 ANNUAL MEETING
POSITIONS WITH DIRECTOR PRINCIPAL OCCUPATION OTHER
NAME ACNIELSEN SINCE DURING LAST FIVE YEARS AGE DIRECTORSHIPS
---- --------- ----- ---------------------- --- -------------
Michael P.Connors Vice Chairman and 1996 Vice Chairman, ACNielsen, 41
Director 5/96 to present; Senior Vice
President and Chief Human
Resources Officer, Dun &
Bradstreet (business
information), 4/95 to
11/96; Senior Vice
President, American
Express Travel Related
Services (travel related
services), 9/89 to 3/95.
Karen L.Hendricks Director 1996 Chairman, President and 48 Baldwin Piano & Organ
Chief Executive Officer, Company.
Baldwin Piano & Organ
Company (manufacturer of
musical instruments), 1/97
to present; President and
Chief Executive Officer,
11/94 to 1/97; Executive Vice
President & General Manager,
Skin Care Division, The Dial
Corp (consumer products),
5/92 to 9/94; Manager,
Worldwide Strategic
Planning, Hair Care, The
Procter & Gamble Company
(consumer products), 9/71 to
5/92.
Robert Holland, Jr. Director 1996 Business consultant, 10/96 56 Ben & Jerry's
to present; President and Homemade, Inc.;
Chief Executive Officer, Ben Frontier Corporation;
& Jerry's Homemade, Inc. The Mutual Life
(ice cream and frozen Insurance Company of
desserts), 2/95 to 10/96; New York.
Chairman, Rokher-J, Inc.
(beverage distribution),
10/91 to 2/95.
Robert N. Thurston Director 1996 Business consultant, 1985 to 64 McDonald's
present; former Executive Corporation; Ag-Bag
Vice President, The Quaker International Ltd.
Oats Company.
8
MEETINGS AND COMMITTEES OF THE BOARD
During the period beginning with its election on October 16, 1996 and
ending December 31, 1996, the Board of Directors held two meetings. In addition,
four meetings of Board Committees were held.
The Board of Directors has three standing Committees comprising (i) the
Audit and Finance Committee, (ii) the Compensation Committee and (iii) the
Nominating Committee. All of these Committees were established in October 1996.
The principal functions of the Audit and Finance Committee are to (i)
assure that the internal accounting controls of the Company are adequate to
ensure that the Company's financial statements are prepared in accordance with
generally accepted accounting principles, and (ii) review the key financial
aspects of the Company's business, develop recommendations and render reports
with respect thereto to the Board. The Audit and Finance Committee consists of
Messrs. Hendrickson (Chairman), Griffin, Holland, Meyer, Pemberton and Ms.
Hendricks. The Audit and Finance Committee held one meeting during 1996.
The principal functions of the Compensation Committee are to (i) review
and approve the annual compensation and benefits of senior executives, and (ii)
administer the compensation and benefit plans maintained by the Company. It also
has the authority to amend all compensation and benefit plans maintained by the
Company to the extent the delegation of such authority to the Compensation
Committee is permitted under such plans. In performing its responsibilities, the
Compensation Committee advises on, recommends and approves executive and
professional compensation policies, strategies and pay levels and assists the
Board in ensuring that the Company's officers, key executives and Board members
are compensated in accordance with the executive and professional compensation
policy established by the Board of Directors. The Compensation Committee
consists of Messrs. Thurston (Chairman), Griffin, Hays and Pemberton. The
Compensation Committee held two meetings during 1996.
The principal functions of the Nominating Committee are to (i) recommend
criteria to the Board regarding qualifications for Board membership, (ii) review
the qualifications of candidates for Board membership and (iii) recommend
candidates to the Board for election as directors. Shareholders' recommendations
for nominees for membership on the Board of Directors will be considered by the
Nominating Committee. The Nominating Committee has not adopted formal procedures
for the submission of such recommendations. However, Shareholders may recommend
nominees to the Nominating Committee by submitting the names in writing to: John
R. Meyer, Chairman of the Nominating Committee, ACNielsen Corporation, 177 Broad
Street, Stamford, CT 06901. ACNielsen's by-laws specify certain time
limitations, notice requirements and other procedures applicable to the
submission of nominations to be brought before an Annual or Special Meeting of
the Company. The Nominating Committee consists of Messrs. Meyer (Chairman),
Beeby, Hays, Hendrickson and Trivisonno. The Nominating Committee held one
meeting during 1996.
RATIFICATION OF SELECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS
Upon the recommendation of the Audit and Finance Committee, the Board of
Directors of ACNielsen has selected Arthur Andersen LLP ("Arthur Andersen") as
independent public accountants to audit the consolidated financial statements of
the Company for the year 1997. In accordance with a resolution of the Board of
Directors, this selection is being presented to Shareholders for ratification at
the Annual Meeting.
Arthur Andersen was appointed by the Board of Directors of ACNielsen as
the Company's independent public accountants, effective as of the Spin-Off Date,
and after the Board had consulted with, and received the approval of, those
persons who were to be appointed to the Board's Audit and Finance Committee when
that Committee was subsequently formed.
Coopers & Lybrand L.L.P. ("Coopers & Lybrand") had been engaged by Dun &
Bradstreet prior to the Spin-Off to audit the financial statements of ACNielsen
in connection with the Spin-Off. The report of Coopers & Lybrand contained no
adverse opinion or a disclaimer of opinion, or qualification or modification as
to uncertainty, audit scope, or accounting principles.
9
During ACNielsen's 1994 and 1995 fiscal years, and the ten-month period in
1996 prior to engaging Arthur Andersen, neither ACNielsen nor, to the best of
ACNielsen's knowledge, anyone acting on ACNielsen's behalf, consulted Arthur
Andersen regarding either (i) the application of accounting principles to a
specified transaction, either completed or proposed, the type of audit opinion
that might be rendered on ACNielsen's financial statements, or a written report
or oral advice provided to ACNielsen that Arthur Andersen concluded was an
important factor considered by ACNielsen in reaching a decision as to the
accounting, auditing or financial reporting issue or (ii) any matter that was
the subject of a disagreement (as defined in paragraph 304(a)(1)(iv) of
Regulation S-K) with the former accountant or a reportable event (as described
in paragraph 304(a)(1)(v) of Regulation S-K).
In connection with the audits of the financial statements of ACNielsen as
of December 31, 1995 and 1994 and for each of the two years in the period ended
December 31, 1995, and in the subsequent interim period, no disagreements
existed between ACNielsen and Coopers & Lybrand on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure that, if not resolved to the satisfaction of Coopers & Lybrand, would
have caused it to make reference to the subject matter of the disagreement in
connection with its report.
A representative of Arthur Andersen is expected to be present at the
Annual Meeting. Such representative will have the opportunity to make a
statement if he or she so desires and is expected to be available to respond to
appropriate questions.
If the proposal to ratify the selection of Arthur Andersen is not approved
by Shareholders, or if prior to the 1998 Annual Meeting, Arthur Andersen
declines to act or otherwise becomes incapable of acting, or if its employment
is discontinued by the Board of Directors, then the Board of Directors will
appoint other independent accountants whose employment for any period subsequent
to the 1998 Annual Meeting will be subject to ratification by the Shareholders
at that meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THE
SELECTION OF ARTHUR ANDERSEN.
PROPOSALS REGARDING APPROVAL OF
EXECUTIVE COMPENSATION PLANS
Section 162(m) of the Internal Revenue Code (the "Code") provides, with
certain exceptions, that a publicly-held corporation (such as ACNielsen) may not
take a federal income tax deduction for compensation paid to a "covered
employee" in excess of $1 million in a taxable year. A "covered employee" is the
Chief Executive Officer of ACNielsen and any other officer who is among the four
highest compensated officers (other than the Chief Executive Officer) as
reported in the Proxy Statement and employed at year-end.
The million dollar limit on deductibility does not apply to compensation
that meets the requirements for "qualified performance-based compensation" as
defined in the applicable Treasury regulations. These requirements include,
among other things, that the material terms of the performance goals be
disclosed to and approved by Shareholders.
To comply with the requirements of Section 162(m), the Board of Directors
is seeking Shareholder approval for two employee compensation plans that provide
performance-based compensation to senior executives, so that such compensation
can qualify for tax deductibility under the Code. The two plans are the 1996
ACNielsen Corporation Key Employees' Stock Incentive Plan (the "Option Plan"),
which provides for the grant of stock options and other equity-based awards, and
the 1996 ACNielsen Corporation Senior Executive Incentive Plan (the "Incentive
Plan"), which provides for the grant of annual and long-term bonuses. In the
event Shareholders do not approve the Option and Incentive Plans, no additional
grants under those plans will be made. However, previously granted options and
LSARs will remain valid and annual bonuses previously awarded will remain
payable under the plans and continue to qualify as performance-based
compensation under Section 162(m) of the Code.
10
PROPOSED KEY EMPLOYEES' STOCK INCENTIVE PLAN
The summary of the Option Plan which is included below is subject to the
complete terms of the plan, a copy of which is attached to this Proxy Statement
as Exhibit A.
SUMMARY OF PLAN
Eligible Employees. Key employees of ACNielsen and its subsidiaries who
are from time to time responsible for the management, growth and protection of
the business of ACNielsen and its subsidiaries are eligible to participate in
the Option Plan. Currently, approximately 250 employees participate.
Shares Subject to Plan; Maximum Award. The total number of shares of
ACNielsen Common Stock that may be awarded under the Option Plan is 12,000,000.
The total number of shares that may be awarded to any participant during a
calendar year is 700,000.
Administration. The Compensation Committee of ACNielsen's Board of
Directors (the "Committee") selects participants and the number of options or
other types of awards to be granted to each participant, and has the authority
to administer and interpret the Option Plan. Members of the Committee must be
"non-employee directors" within the meaning of Rule 16b-3 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and "outside directors"
within the meaning of Code Section 162(m). The Chief Executive Officer of
ACNielsen may grant awards of up to 10,000 shares each year to any participant
who is not subject to Section 16 of the Exchange Act, provided the Chief
Executive Officer notifies the Committee of the proposed grant(s) and the
Chairman of the Committee approves.
Types of Awards. The Committee may grant stock options, stock appreciation
rights ("SARs"), limited stock appreciation rights ("LSARs"), and other
equity-based awards (including, but not limited to, restricted stock).
Options. Both nonqualified and incentive stock options may be granted
under the plan. Each option will have an exercise price no less than 100% of the
average of the high and low trading prices of ACNielsen Common Stock on the date
of grant. Options granted under the plan will be exercisable at such time and on
such terms and conditions as may be determined by the Committee, but in no event
will an option be exercisable more than ten years after the date it is granted.
A participant's rights to exercise options are contingent upon his or her
continuing employment and the circumstances under which employment is
terminated. If a participant's employment terminates by reason of death,
disability or retirement, all options will vest and may be exercised up to the
shorter of five years after termination or the remaining term of the option. If
a participant dies following disability or retirement while the options are
still exercisable, the unexercised options may be exercised for the shorter of
(i) the remaining term of the option or (ii) the longer of five years after the
date of termination or one year after death. Unless an award agreement otherwise
provides, if a participant's employment is terminated for any other reason,
options that are not vested as of the date of termination are forfeited, and
vested options may be exercised up to 90 days after the date of termination.
Stock Appreciation Rights and Limited Stock Appreciation Rights. SARs
entitle a participant upon exercise to a cash payment equal to the excess of the
fair market value of a share of ACNielsen Common Stock on the exercise date over
the exercise price of the SAR. The exercise price will be an amount determined
by the Committee, but in no event less than the fair market value of a share of
Common Stock on the date the SAR is granted. The Committee may grant LSARs that
are exercisable upon the occurrence of a specified event. LSARs may provide for
a different method of determining appreciation, may specify that payment will be
made only in cash, and may provide that any related awards are not exercisable
while LSARs are exercisable.
Other Awards. The grant of other equity-based awards may consist of shares
of ACNielsen's Common Stock (including, but not limited to, shares of restricted
stock), or awards valued in whole or in part with reference to the fair market
value of such shares. The terms of other equity-based awards may be set by the
Committee and may include performance-based awards that are intended to conform
with the requirements of Section 162(m) of the Code. The
11
maximum amount of such other performance-based equity awards to any participant
for any fiscal year of ACNielsen will be $6 million. The maximum award was set
above ACNielsen's anticipated target award levels for executives because the
Section 162(m) regulations allow only "negative discretion" in respect of this
type of plan.
Performance Goals. Amounts payable with respect to performance-based
equity awards which are intended to conform with the requirements of Section
162(m) of the Code, will be determined based on the attainment of written
performance goals approved by the Committee for a performance period established
by the Committee while the outcome for that performance period is substantially
uncertain and no more than 90 days after the commencement of the performance
period to which the performance goal relates or, if less, the number of days
which is equal to 25% of the relevant performance period. The performance goals,
which must be objective, will be based upon one or more of the following
criteria: (i) consolidated earnings before or after taxes (including earnings
before interest, taxes, depreciation and amortization), (ii) net income, (iii)
operating income, (iv) earnings per share, (v) book value per share, (vi) return
on shareholders' equity, (vii) expense management, (viii) return on investment,
(ix) improvements in capital structure, (x) profitability of an identifiable
business unit or product, (xi) maintenance or improvement of profit margins,
(xii) stock price, (xiii) market share, (xiv) revenues or sales, (xv) costs,
(xvi) cash flow, (xvii) working capital and (xviii) return on assets. The
foregoing criteria may relate to ACNielsen, one or more of its subsidiaries, one
or more of its divisions or units or any combination of the foregoing and may be
applied on an absolute basis or be relative to one or more peer group companies
or indices, or any combination thereof, all as the Committee determines. To the
degree consistent with Section 162(m) of the Code, the performance goals may be
calculated without regard to extraordinary items.
Payment. The Committee determines whether the applicable performance goals
have been met and certifies and ascertains the amount of the award. At the
discretion of the Committee, the amount of the award actually paid in respect of
an award may be less than the amount determined by the applicable performance
goal formula. An amount payable with respect to an award will be paid to a
participant at a time determined by the Committee in its sole discretion after
the completion of the performance period provided that a participant may, if and
to the extent permitted by the Committee and consistent with the provisions of
Section 162(m) of the Code, elect to defer the payment of his or her award.
Adjustments. In the event of any change in outstanding shares pursuant to
certain events specified in the plan (e.g., a merger or recapitalization), the
Committee may make such substitutions or adjustments as it deems equitable.
Unless otherwise specified in related award agreements, the Committee may take
such action it deems necessary or desirable with respect to awards in the event
of a "change in control" (as defined in the Option Plan) of ACNielsen
(including, without limitation, (i) the acceleration of an award, (ii) the
payment of a cash amount in exchange for the cancellation of an award, or (iii)
the issuance of substitute awards that will substantially preserve the value,
rights and benefits of any affected awards previously granted).
Amendment; Termination. The Board of Directors of ACNielsen may amend or
discontinue the plan, but no amendment or discontinuation may be made which (i)
without the approval of the Shareholders of ACNielsen, would increase the total
number of shares reserved for issuance under the plan or change the maximum
number of shares for which awards may be granted to any participant or (ii)
without the consent of a participant, would impair any of the rights or
obligations under any award granted to such participant. Following a "change in
control," the Board of Directors may not amend or terminate the change in
control provisions of the plan.
International Participants. The Committee may amend the terms of the plan
or any award with respect to participants who reside or work outside the United
States to conform such terms with the requirements of local law.
Effectiveness. The Option Plan was effective as of November 1, 1996. The
Option Plan provides that if it is not approved by the Shareholders of ACNielsen
prior to November 1, 1997, no awards may be granted thereafter. See "Proposals
Regarding Approval of Executive Compensation Plans" above for further
information on the effect of non-approval of the plan by Shareholders. No award
may be granted under the plan after November 1, 2006.
Consideration. The consideration to be received for the granting of
options and any other awards under the Option Plan is the continued employment
by participants. Consideration for the issuance of shares under the Option
12
Plan upon exercise of an option will consist of the payment of the exercise
price. Consideration for the exercise of an LSAR is the surrender of a related
option.
FEDERAL INCOME TAX CONSEQUENCES
Nonqualified Stock Options. If a participant receives a nonqualified
option, the excess of the market value of the stock on the date of exercise over
the option price will be treated as taxable income to the participant on the
date of exercise and ACNielsen will be entitled to an income tax deduction in
the same year in an amount equal to the amount of income taxable to the
participant. The participant will be entitled to a cost basis for the stock for
income tax purposes equal to the amount paid for the stock plus the amount of
income taxable at the time of exercise. Any subsequent sale of such stock will
be entitled to short-term or long-term capital gain or loss depending on the
participant's holding period for the shares.
Incentive Stock Options. If a participant receives an incentive stock
option satisfying the requirements of the Code and does not dispose of shares
received upon exercise of the option less than one year after exercise and two
years after grant of the option, the excess of the option exercise price over
the fair market value of the shares received upon exercise (the "incentive stock
option spread") will not be subject to federal taxation until the optionee sells
or otherwise disposes of the shares received. In such event ACNielsen is not
entitled to a deduction for income tax purposes in connection with the exercise
of the option. Such incentive stock option spread, nevertheless, will be an
adjustment in computing alternative minimum taxable income as of the date of
exercise. Upon any subsequent sale of the shares received as a result of the
exercise, any amount realized in excess of the option exercise price will be
subject to tax as long-term capital gain and any loss will be treated as
long-term capital loss. If the above requirements for incentive stock option tax
treatment are not met, the option generally is treated as a nonqualified option.
Stock Appreciation Rights and Limited Stock Appreciation Rights. Amounts
received upon the exercise of a SAR or LSAR are taxed at ordinary rates when
received. ACNielsen will be allowed an income tax deduction equal to the amount
recognized as ordinary income.
Other Awards. Amounts received by a participant in respect of other
equity-based awards are generally taxed at ordinary rates when received. If such
amounts consist of property subject to restrictions, however, the amounts
generally will not be taxed until the restrictions lapse or until the
participant makes an election under Section 83(b) of the Code. Subject to
Section 162(m) of the Code, ACNielsen will generally be allowed an income tax
deduction equal to the amount recognized as ordinary income by the participant
at the time such amount is taxed.
ADDITIONAL INFORMATION
The amounts that will be received by participants under the Option Plan
are not yet determinable as awards are at the discretion of the Committee. The
numbers of shares subject to options, with tandem LSARs, which have been awarded
to date under the Option Plan to each of the five executive officers named in
the Summary Compensation Table are set forth in the table entitled "Option/SAR
Grants in Last Fiscal Year" which follows the Summary Compensation Table and are
described in such table as "Effective Date Options." The number of shares
subject to options which have been awarded to date to the following groups of
individuals are set forth below (only executive officers received tandem LSARs):
OPTIONS GRANTED
UNDER OPTION PLAN
-----------------
Executive Officers as a Group ............................... 2,100,000
Non-Executive Director Group ................................ 0
Non-Executive Officer Employee Group ........................ 2,541,055
The closing market price of ACNielsen Common Stock on February 28, 1997
was $14.75.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSED KEY EMPLOYEES'
STOCK INCENTIVE PLAN.
13
PROPOSED SENIOR EXECUTIVE INCENTIVE PLAN
The summary of the Incentive Plan which is included below is subject to
the complete terms of the plan, a copy of which is attached to this Proxy
Statement as Exhibit B.
SUMMARY OF PLAN
Eligible Employees. Only a senior executive of ACNielsen who (i) is (or is
anticipated to become) a "covered employee" as defined in Section 162(m) of the
Code and (ii) is selected by the Committee, may participate in the Incentive
Plan. Currently, five employees participate.
Maximum Award. The maximum amount of any award to any participant with
respect to any fiscal year of ACNielsen is $6 million. The maximum award was set
above ACNielsen's anticipated target award levels for executives because the
Section 162(m) regulations only allow "negative discretion" in respect of this
type of plan.
Administration. The Committee selects participants, determines the size
and terms of an award, the time when awards will be made and the performance
period to which they relate, establishes performance objectives and certifies
that such performance objectives are achieved, all in accordance with Section
162(m) of the Code. The Committee also has the authority to interpret the plan
and to make any determinations that it deems necessary or desirable for its
administration. Members of the Committee must be "non-employee directors" within
the meaning of Rule 16b-3 of the Exchange Act and "outside directors" within the
meaning of Code Section 162(m).
Performance Goals. A participant's award is based on the attainment of
written performance goals approved by the Committee for a performance period
established by it while the outcome of that performance period is substantially
uncertain, and no more than 90 days after the commencement of the performance
period to which the performance goal relates or, if less, the number of days
which is equal to 25% of the relevant performance period. The performance goals,
which must be objective, will be based upon one or more of the following
criteria: (i) consolidated earnings before or after taxes (including earnings
before interest, taxes, depreciation and amortization), (ii) net income, (iii)
operating income, (iv) earnings per share, (v) book value per share, (vi) return
on shareholders' equity, (vii) expense management, (viii) return on investment,
(ix) improvements in capital structure, (x) profitability of an identifiable
business unit or product, (xi) maintenance or improvement of profit margins,
(xii) stock price, (xiii) market share, (xiv) revenues or sales, (xv) costs,
(xvi) cash flow, (xvii) working capital and (xviii) return on assets. The
foregoing criteria may relate to ACNielsen, one or more of its subsidiaries, one
or more of its divisions or units or any combination of the foregoing, and may
be applied on an absolute basis or be relative to one or more peer group
companies or indices, or any combination, all as the Committee determines. To
the degree consistent with Section 162(m) of the Code, the performance goals may
be calculated without regard to extraordinary items.
Payment. Payment of an award may be made in cash or in the form of an
equity-based grant subject to the terms of the Option Plan. The Committee
determines whether the applicable performance goals have been met and certifies
and ascertains the amount of the award. At the discretion of the Committee, the
amount of the award actually paid may be less than the amount determined by the
applicable performance goal formula. The award will be paid to a participant at
a time determined by the Committee in its sole discretion after the completion
of the performance period provided that a participant may, if and to the extent
permitted by the Committee and consistent with the provisions of Section 162(m)
of the Code, elect to defer the payment of his or her award.
Adjustments. In the event of any change in outstanding shares pursuant to
certain events specified in the plan (e.g., merger or recapitalization), the
Committee may make such substitution or adjustment to the affected terms of an
award as it deems equitable. The Committee may take such action as it deems
necessary or desirable with respect to any award in the event of a "change in
control" (as defined in the Incentive Plan) of ACNielsen (including without
limitation (i) the acceleration of an award, (ii) the payment of a cash amount
in exchange for the cancellation of an award or (iii) the issuance of a
substitute award that will substantially preserve the value, rights and benefits
of any affected award previously granted). Any participant who as a result of a
"change in control" receives payments pursuant to a change in control agreement
will receive, subject to the same terms and conditions under which such payments
are made, an amount in cash equal to (i) the annual target bonus under the
Incentive Plan for the year in
14
which the change in control occurs, multiplied by a fraction, the numerator of
which equals the number of days in the annual performance period during which
the participant was employed by ACNielsen and the denominator of which is 365
and (ii) the entire target bonus opportunity with respect to all other
performance periods in progress under the Incentive Plan at the time of the
participant's termination of employment from the Company.
Amendment; Termination. The Board of Directors of ACNielsen may amend or
discontinue the plan, but no amendment or discontinuation may be made which
impairs any of the rights or obligations under any award previously granted to a
participant without his or her consent. Following a "change in control," the
Board of Directors may not amend or terminate the change in control provisions
of the plan.
Effectiveness. The Incentive Plan was effective as of November 1, 1996.
The Incentive Plan provides that if the plan is not approved by the Shareholders
of ACNielsen prior to the first meeting of Shareholders following November 1,
1997, no awards will be awarded or payable thereafter. See "Proposals Regarding
Approval of Executive Compensation Plans" above for further information on the
effect of non-approval of the plan by Shareholders.
ADDITIONAL INFORMATION
The amounts that will be received by participants under the Incentive Plan
are not yet determinable as awards are at the discretion of the Committee and
payments pursuant to such awards depend on the extent to which established
performance goals are met.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSED SENIOR EXECUTIVE
INCENTIVE PLAN.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
AND CERTAIN TRANSACTIONS
REPORT OF THE COMPENSATION COMMITTEE
BACKGROUND
This report to Shareholders reviews the decisions made and actions taken
by the Compensation Committee of the Board of Directors (the "Committee") as
they relate to the compensation of (i) the Chairman and Chief Executive Officer,
(ii) the other executive officers named in the Summary Compensation Table and
(iii) the senior management group in general, for the period from November 1,
1996, the Spin-Off Date, to December 31, 1996.
Dun & Bradstreet's Compensation Committee (the "D&B Committee"), under the
supervision of Dun & Bradstreet's Board of Directors and working with
independent executive compensation consultants, developed and approved the
general framework and many of the specific features of the Company's post
Spin-Off executive compensation program. The Committee reviewed the
aforementioned program developed and approved by the D&B Committee, exercised
its own independent judgment and approved the program with certain minor
modifications.
The Committee has developed an executive compensation philosophy intended
to meet several important criteria: (i) enable the Company to retain and attract
the necessary strategic management resources; (ii) directly link management
compensation to the Company's share price appreciation and, therefore,
shareholder value appreciation; and (iii) tie pay to the Company's achievement
of a financial turnaround. In all of its executive compensation determinations,
the Committee considered the nature of the financial and operational challenges
facing the Company.
EXECUTIVE COMPENSATION PROGRAM -- OVERVIEW AND ACTIONS
The executive compensation program for executive officers named in the
Summary Compensation Table (the "named officers") is comprised of two principal
elements: annual cash compensation (consisting of base salaries and annual
incentives) and long-term incentives (consisting of turnaround incentives and
stock option awards). These
15
plans were each designed to further the Shareholders' interests by facilitating
the employment of talented executives and motivating them to achieve superior
levels of performance. An overview of each of these elements and the specific
actions taken for the period subsequent to the Spin-Off is provided below.
ANNUAL CASH COMPENSATION
Annual cash compensation for ACNielsen executives consists of base salary
and an annual at-risk incentive.
The Committee reviewed competitive pay data, and set base salary levels
and annual incentive targets for the named officers for the period through
December 31, 1998. In making its determinations the Committee examined pay data
provided by an independent executive compensation consultant for similar or
related positions in a 28-company sample of consumer packaged goods companies
and reviewed such data with the consultant. In addition, the Committee
considered compensation practices among professional service firms.
The Company considers these to be relevant competitive frames of reference
as the pay levels reflect compensation levels for the labor market within which
ACNielsen competes for executive talent. The Committee is aware that this
comparison group differs from that used for relative shareholder return
comparison purposes in this Proxy Statement's performance graph. The Committee
believes that the performance graph peer group does not reflect the labor market
within which the Company competes for executive resources.
In making its determinations for the named officers, the Committee
considered the unique experience base and qualifications of the executives
joining ACNielsen and the nature of the challenges facing the Company. The
Committee reviewed base salary levels and annual incentive targets for the named
officers, and approved adjustments effective as of the Spin-Off based on the
executives' responsibilities in an independent company, the competitive data
presented by the independent consultant and levels of compensation at Dun &
Bradstreet.
The Committee did not continue the Dun & Bradstreet long-term performance
plan which historically represented a significant portion of executive
compensation.
The annual incentive plan links each executive's award to performance
measures most appropriate to the executive's responsibilities. To focus efforts
on overall Company objectives, all participants in the plan have a significant
portion of their award tied to corporate and/or specific business unit financial
performance, as defined by revenue, operating income and other measures selected
by the Committee at the outset of the year.
For 1996, with the exception of Robert J. Chrenc, annual incentives to the
named officers for the period through the November 1, 1996 Spin-Off Date were
determined by the D&B Committee and paid by Dun & Bradstreet. The Committee
determined annual incentive awards paid for the last two months of 1996 based on
the Company's fourth quarter and full-year business results.
LONG-TERM INCENTIVE COMPENSATION
The Company provides the named officers, other senior executives and key
managers of its principal business units with incentives linked to longer-term
corporate performance through the turnaround incentive described below and
through equity-based incentives. The combination of these two key elements is
intended to enable participants to benefit accordingly when meaningful
Shareholder wealth has been created, and directly link a significant portion of
total and at-risk compensation to the Company's long-term stock performance.
ACNielsen's turnaround incentive heightens the focus for senior and
operating executives on the need to dramatically improve the Company's financial
results. The turnaround incentive provides awards to participants based on the
Company's cumulative revenue growth, operating income and return on investment
performance over a two-year period. In conjunction with the Spin-Off, the
Committee approved the adoption of the turnaround incentive and specific
incentive targets for the participants and performance objectives for the
1997-1998 performance period.
For 1996, long-term incentive compensation for the period through the
November 1, 1996 Spin-Off Date was determined by the D&B Committee and paid by
Dun & Bradstreet.
The equity-based incentive plans provide senior corporate and business
unit managers and key employees, including the named officers, with stock
option-based incentives. The equity-based incentive plans are generally designed
to provide periodic grants of options to acquire the Company's Common Stock.
16
A portion of the stock options granted in conjunction with the Spin-Off
reflected the substitution of ACNielsen options ("Substitute Options") for Dun &
Bradstreet stock options held by ACNielsen executives as of the Spin-Off Date.
The conversion method was agreed to as part of the Spin-Off agreements with Dun
& Bradstreet and was calculated by comparing Dun & Bradstreet's average stock
price over the five consecutive trading days immediately preceding the first
date on which Dun & Bradstreet Common Stock traded ex-dividend and ACNielsen's
average stock price for the five consecutive trading days starting on the first
date on which ACNielsen Common Stock traded regular way. The conversion resulted
in an increased number of options, each with lower exercise prices to preserve
the economic value of the D&B options, all of which D&B options initially had
been granted at fair market value. Other material provisions, including the
normal vesting schedule and term, were not changed.
In addition to Substitute Options, grants of new stock options ("Effective
Date Options") were made to the named officers in conjunction with the
establishment of the Company as an independent, publicly-traded corporation.
These Effective Date Options were granted with an exercise price based on the
average of the high and low trading prices of ACNielsen Common Stock on the
first day of regular way trading as an independent company. The amounts of the
Effective Date Option grants were initially approved by the D&B Committee as
part of its pre-Spin-Off Date determinations as described above. Thereafter, the
Committee set the amounts and terms of such options prior to the Spin-Off. The
Effective Date Option grants were approved as part of the launching of the
independent ACNielsen, were designed to maximize the incentive to increase the
value of ACNielsen to its Shareholders, and recognized both (i) the reduced
long-term cash compensation opportunity available to the named officers as
compared to the long-term cash compensation opportunity that had been available
to them at Dun & Bradstreet prior to the Spin-Off and (ii) that the executive
compensation program anticipates no additional stock option grants to the named
officers and other select executives prior to November 1999.
The Effective Date Options granted to the named officers become
exercisable ratably over six years. In addition, the Committee added a
performance-accelerated vesting provision to these options whereby one-half of
the unvested options become exercisable if the Company's stock price reaches
150% of the exercise price for five consecutive trading days and the remaining
unvested options become exercisable if the Company's stock price reaches 200% of
the exercise price for five consecutive trading days.
COMPENSATION FOR THE CHIEF EXECUTIVE OFFICER
In October 1996, the Committee reviewed the base salary and annual
incentive target for the Company's Chairman and Chief Executive Officer, Mr.
Nicholas L. Trivisonno. Based on a review of competitive compensation levels,
and consideration of Mr. Trivisonno's promotion from Executive Vice President
and Chief Financial Officer of Dun & Bradstreet to Chairman and Chief Executive
Officer of an independent, publicly-traded company and the advice of outside
consultants, the Committee decided to adjust Mr. Trivisonno's base salary and
annual incentive target, by 22% and 43%, respectively, from the levels awarded
to him at Dun & Bradstreet. The Committee views the adjusted levels as
appropriate within the competitive labor market for Chairman and CEOs of
comparable companies. In addition, the Committee set Mr. Trivisonno's two-year
turnaround incentive target at $750,000 based on a review of competitive total
pay levels, the advice of outside consultants and his expected leadership role
in effecting the Company's financial turnaround.
Mr. Trivisonno was granted 650,000 Effective Date Options in conjunction
with the Spin-Off. These Effective Date Options were granted with exercise
prices equal to the fair market value of the Company's Common Stock on the first
day of regular way trading, six-year ratable vesting, and
performance-accelerated vesting as described above. In addition, Mr. Trivisonno
was granted 90,145 Substitute Options based on the conversion of Mr.
Trivisonno's outstanding Dun & Bradstreet stock options using the method
described above to preserve the economic value of such Dun & Bradstreet options.
The Committee also awarded Mr. Trivisonno an annual incentive award of
$86,000 for the two-month post Spin-Off period based on its assessment of the
Company's financial performance as having exceeded its revenue, operating income
and net income targets for the fourth quarter and full-year, and in recognition
of the Company having exceeded its employee satisfaction improvement objective.
Additionally, the Committee considered Mr. Trivisonno's efforts in successfully
leading ACNielsen in its Spin-Off from Dun & Bradstreet and to its new status as
a public company.
17
$1 MILLION DEDUCTION LIMIT
Section 162(m) of the Internal Revenue Code (the "Code") limits
deductibility of certain compensation for the Chief Executive Officer and the
additional four executive officers who are highest paid and employed at year-end
to $1 million per year per executive. The $1 million limit on deductibility does
not apply to compensation that meets the requirements for qualified
performance-based compensation as further described in the regulations adopted
under the Code.
Elsewhere in this Proxy Statement, there are set forth proposals to
approve the 1996 ACNielsen Corporation Senior Executive Incentive Plan and 1996
ACNielsen Corporation Key Employees' Stock Incentive Plan. If approved by
Shareholders, both of these plans would enable the Company to meet the
conditions necessary to allow compensation under those plans, including any
turnaround incentives, to qualify for tax deductibility under the Code. Under
the Code, the Effective Date Options and the annual incentive awards granted to
date under such plans qualify for tax deductibility.
IN CONCLUSION
The Committee believes the executive compensation program described above,
through the Committee's administration of the elements of the program, will
facilitate the Company's ability to retain, motivate and attract the executive
resources required to maximize Shareholder returns. The emphasis on variable pay
and the direct link to both short- and long-term results, as well as financial
and stock performance, links pay to critical measures of Company performance.
THE COMPENSATION COMMITTEE
Robert N. Thurston, Chairman
Donald W. Griffin
Thomas C. Hays
Brian B. Pemberton
18
PERFORMANCE GRAPH
The following graph compares the cumulative total return to Shareholders
of ACNielsen Common Stock to the cumulative total return of the Standard &
Poor's 500 Index and an index of performance peer companies. Since there is no
widely recognized standard industry group or index comprising ACNielsen and peer
companies, the BusinessWeek magazine Other Services group of companies has been
used as the peer group. This is an independently compiled company grouping that
includes ACNielsen and 12 other companies. The performance peer group return
figures shown in the graph exclude ACNielsen. As ACNielsen only commenced
regular way trading on the New York Stock Exchange on November 4, 1996, the
period covered by the graph begins on that date and ends on January 31, 1997.
[Graphical Representation of Data Table Below]
COMPARISON OF CUMULATIVE TOTAL RETURN
ACNIELSEN, S&P 500 & BUSINESSWEEK INDEX
S&P 500 BW INDEX ACNielsen
------- -------- ---------
11/04/96 $100 $100 $100
11/30/96 $107.56 $107.87 $111.16
12/31/96 $105.43 $103.78 $ 97.57
01/31/97 $112.02 $105.73 $104.77
Source: Zacks Investment Research, Inc.
Assumes $100 invested on 11/4/96
Assumes dividend reinvestment
THE PERFORMANCE PEER GROUP CONSISTS OF CDI CORPORATION, COGNIZANT CORPORATION,
CUC INTERNATIONAL, INC., HANDLEMAN COMPANY, HEALTHSOURCE, INC., INACOM
CORPORATION, KELLY SERVICES INC., MANPOWER INC., OLSTEN CORPORATION, PHH
CORPORATION, SERVICE CORPORATION INTERNATIONAL, AND SERVICEMASTER LIMITED
PARTNERSHIP. IN ACCORDANCE WITH SEC REQUIREMENTS, THE RETURN FOR EACH ISSUER IN
THE PEER GROUP HAS BEEN WEIGHTED ACCORDING TO THE RESPECTIVE STOCK MARKET
CAPITALIZATION OF SUCH ISSUER.
19
SUMMARY COMPENSATION TABLE
With the exception of Robert J. Chrenc, the executive officers named in
the Summary Compensation Table below were employed by Dun & Bradstreet until the
Spin-Off Date. Accordingly, as reflected in the Summary Compensation Table, such
executive officers' compensation, both annual and long-term, for all periods up
to the November 1, 1996 Spin-Off Date was paid by Dun & Bradstreet based on
their responsibilities at Dun & Bradstreet and their compensation for the
remainder of 1996 was paid by ACNielsen. All 1995 compensation was paid by Dun &
Bradstreet.
LONG-TERM COMPENSATION
--------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------ -------------------- ----------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
SECURITIES
OTHER ANNUAL RESTRICTED UNDERLYING LONG-TERM ALL OTHER
COMPEN- STOCK OPTIONS/ INCENTIVE COMPEN-
SALARY BONUS SATION(1) AWARD(S)(2) SARS(3) PAYOUTS(4) SATION(5)
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($) ($)
- --------------------------- ---- ------- ------- ---------- -------- ---------- ---------- ------
Nicholas L. Trivisonno (6) 1996 ACN 91,667 86,000 -- 0 740,145 0 3,208 ACN
Chairman and Chief D&B 375,000 691,667 -- 0 0 550,000 0 D&B
Executive Officer ------- ------- - ------- ------- -----
Total 466,667 777,667 -- 0 740,145 550,000 3,208 Total
====================================================================================================
1995 D&B 146,591 175,000 -- 0 24,114 0 0 D&B
====================================================================================================
Robert J Lievense 1996 ACN 79,167 64,000 -- 0 606,522 0 2,771 ACN
President and Chief D&B 368,333 694,406 576 0 0 1,096,341 27,791 D&B
Operating Officer ------- ------- --- - ------- --------- ------
Total 447,500 758,406 576 0 606,522 1,096,341 30,562 Total
====================================================================================================
1995 D&B 411,026 265,662 1,187 307,988 15,696 116,112 23,216 D&B
====================================================================================================
Michael P. Connors (7) 1996 ACN 62,500 56,000 -- 0 437,649 0 2,188 ACN
Vice Chairman D&B 263,333 622,500 551,914 0 0 392,800 8,001 D&B
------- ------- ------- - ------- ------- ------
Total 325,833 678,500 551,914 0 437,649 392,800 10,189 Total
====================================================================================================
1995 D&B 225,000 439,180 -- 249,951 16,759 0 0 D&B
====================================================================================================
Earl H. Doppelt 1996 ACN 62,500 43,000 -- 0 504,325 0 2,188 ACN
Executive Vice President D&B 295,833 791,666 -- 0 0 888,000 22,642 D&B
and General Counsel ------- ------- - ------- ------- ------
Total 358,333 834,666 -- 0 504,325 888,000 24,830 Total
====================================================================================================
1995 D&B 340,000 446,960 -- 79,992 9,411 0 5,671 D&B
====================================================================================================
Robert J. Chrenc (8) 1996 ACN 204,167 175,000 -- 0 325,000 0 2,042 ACN
Executive Vice President ====================================================================================================
and Chief Financial 1995 0 0 0 0 0 0 0
Officer ====================================================================================================
- ----------
(1) The amounts shown for Mr. Lievense represent reimbursement for taxes with
respect to Company-directed spousal travel. The amount shown for Mr.
Connors represents reimbursement for relocation expenses as follows:
$303,250 for relocation expenses incurred and $248,664 for taxes. There
are no amounts required to be reported for the other named officers.
(2) 1995 amounts represent the dollar value on the date of grant of Dun &
Bradstreet restricted stock granted in that year. In 1996, no restricted
stock was granted by either Dun & Bradstreet or ACNielsen and there were
no restricted stock holdings outstanding for the named officers at
December 31, 1996 as, in connection with the Spin-Off, all restrictions on
outstanding Dun & Bradstreet restricted stock terminated.
(3) Amounts shown represent the number of non-qualified stock options granted
each year. Amounts shown for 1996 include both Substitiute Options granted
to replace Dun & Bradstreet options held by the named officers as of the
Spin-Off Date and Effective Date Options granted as part of the launching
of ACNielsen. The number of Substitute Options granted to the named
officers were as follows: Mr. Trivisonno--90,145; Mr. Lievense--181,522;
Mr. Connors--62,649; Mr. Doppelt--179,325; Mr. Chrenc--0. The number of
Effective Date Options granted were as follows: Mr. Trivisonno--650,000;
Mr. Lievense--425,000;
20
Mr. Connors--375,000; Mr. Doppelt--325,000; and Mr. Chrenc--325,000. Under
the current executive compensation program approved by the Committee, it
is anticipated that the named officers will not receive additional stock
option grants prior to November 1999. The amounts shown for 1995 represent
Dun & Bradstreet options which were terminated upon the Spin-Off and which
were replaced by Substitute Options. Accordingly, the total number of
Substitute Options received by each of the named officers in 1996 and
listed above includes options to replace the listed 1995 options. LSARs
were granted in tandem with all listed options.
(4) The amounts shown represent payments made by Dun & Bradstreet under its
long-term incentive plans. The 1996 payments include accelerated payments
made under such plans as a result of the Spin-Off.
(5) 1996 ACNielsen amounts represent Company contributions for the account of
the named officers under the ACNielsen Employee Stock Ownership Plan. The
1995 and 1996 Dun & Bradstreet amounts represent aggregate Dun &
Bradstreet contributions for the account of the named officers under the
Dun & Bradstreet Profit Participation Plan and the Profit Participation
Benefit Equalization Plan.
(6) The 1995 salary and bonus for Mr. Trivisonno represent the amounts earned
from his date of employment, September 5, 1995.
(7) The 1995 salary and bonus for Mr. Connors represent the amounts earned
from his date of employment, April 3, 1995.
(8) The 1996 salary and bonus for Mr. Chrenc represent the amounts earned from
his date of employment, June 1, 1996.
21
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table shows all grants of options and tandem LSARs to the
named executive officers of ACNielsen in 1996. The options and LSARs were
granted under the Key Employees' Stock Incentive Plan and the Replacement Plan
for Certain Employees Holding The Dun & Bradstreet Corporation Equity-Based
Awards. Pursuant to SEC rules, the table also shows the value of the options
granted at the end of the option terms if the stock price were to appreciate
annually by 5% and 10%, respectively. There is no assurance that the stock price
will appreciate at the rates shown in the table.
INDIVIDUAL GRANTS
- --------------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g)
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/ POTENTIAL REALIZABLE VALUE
UNDERLYING SARS AT ASSUMED ANNUAL RATES OF
OPTIONS/ GRANTED TO EXERCISE STOCK PRICE APPRECIATION FOR
SARS EMPLOYEES OR BASE OPTION TERM(3)
GRANTED(1) IN FISCAL PRICE EXPIRATION ----------------------------
NAME (#) YEAR(2) ($/SHARE) DATE 5%($) 10%($)
- ---------------------- ---------- ----------- --------- ---------- ------------ --------------
Nicholas L. Trivisonno Effective Date Options 650,000 14.08% 15.7500 11/03/06 6,438,309 16,315,938
=====================================================================================================
Substitute Options 42,220 2.22% 17.0532 12/19/05 296,856 825,567
47,925 15.6488 09/19/05 394,927 976,780
=====================================================================================================
Robert J Lievense Effective Date Options 425,000 9.21% 15.7500 11/03/06 4,209,663 10,668,114
=====================================================================================================
Substitute Options 45,738 4.48% 17.0532 12/19/05 321,592 894,358
12,938 13.9100 04/18/05 124,126 271,614
41,536 14.4450 12/20/04 352,744 782,298
32,665 16.6519 12/14/03 169,640 444,307
18,848 15.9163 07/20/03 101,826 243,697
20,194 15.4481 12/15/02 108,177 243,446
9,603 15.6153 07/18/99 18,473 39,246
=====================================================================================================
Michael P. Connors Effective Date Options 375,000 8.12% 15.7500 11/03/06 3,714,409 9,413,041
=====================================================================================================
Substitute Options 28,145 1.55% 17.0532 12/19/05 197,892 550,346
34,504 13.9100 04/18/05 331,029 724,361
=====================================================================================================
Earl H. Doppelt Effective Date Options 325,000 7.04% 15.7500 11/03/06 3,219,154 8,157,969
=====================================================================================================
Substitute Options 35,181 4.42% 17.0532 12/19/05 247,364 687,927
41,536 14.4450 12/20/04 352,744 782,298
66,455 15.0469 05/17/04 487,634 1,108,708
36,153 15.0469 05/17/04 265,284 603,162
=====================================================================================================
Robert J. Chrenc Effective Date Options 325,000 7.04% 15.7500 11/03/06 3,219,154 8,157,969
================================================================================================================================
Increase in Value to Shareholders(4) 563,181,182 1,427,211,689
================================================================================================================================
(1) Additional information with respect to the grants denoted as "Effective
Date Options" and "Substitute Options" is contained in note 3 to the
Summary Compensation Table. The Effective Date Options vest ratably over
six years beginning on the first anniversary of the November 4, 1996 grant
date; provided, however, that (i) 50% of any unvested options vest if the
Company's stock price reaches 150% of the exercise price for five
consecutive trading days; and (ii) all unvested options vest (a) if the
Company's stock price reaches 200% of the exercise price for five
consecutive trading days, (b) upon a Change in Control of the Company as
defined in the Change in Control Severance Agreement entered into with the
named officer, or (c) with respect to options held by a named officer,
upon a termination of such named officer's employment without cause (as
defined in the Company's Executive Transition Plan). All outstanding Dun &
Bradstreet options held by the named officers terminated as of the
Spin-Off Date and ACNielsen Substitute Options were granted to replace
them. As discussed in the Committee report, the number and exercise price
of the Substitute Options were determined based on a formula intended to
preserve the economic value of the Dun & Bradstreet options being
replaced, all of which Dun & Bradstreet options initially had been granted
at fair market value. The vesting schedules and expiration dates of the
Substitute Options are identical to the Dun & Bradstreet options being
replaced except that, upon a termination of a named officer's employment
without cause (as defined in the Company's Executive Transition Plan),
such officer's Substitute Options vest immediately. All of the options
were granted with tandem LSARs. LSARs may be exercised,
22
in whole or in part, only during the 30-day period beginning on the first
day following the acquisition of at least 20% of all outstanding Common
Stock pursuant to any tender or exchange offer not made by the Company,
whether or not the Company supports the offer. LSARs are exercisable only
if and to the extent the related option is exercisable. Each LSAR
represents the right to receive cash, upon exercise, equal to the excess
over the related option exercise price of the highest price paid for
shares of Common Stock pursuant to a tender or exchange offer which is in
effect at any time during the 60 days preceding the date on which the LSAR
is exercised.
(2) The percentage shown for Effective Date Options represents the named
officer's percentage of the total Effective Date Options granted to all
employees (4,616,055 options). The percentage shown for Substitute Options
represents the named officer's percentage of the total Substitute Options
granted to all employees (4,054,731 options).
(3) In order to calculate the projected appreciation, the market price used
was $15.75 (the average of the high and low trading prices of ACNielsen
Common Stock on November 4, 1996) for the Effective Date Options and
$15.525 (the option price used to convert "old" Dun & Bradstreet options
to ACNielsen Substitute Options) for the Substitute Options.
(4) Calculated using (i) a Common Stock price of $15.75, the average of the
high and low trading prices on November 4, 1996 (which is the exercise
price of all of the Effective Date Options), and (ii) the total number of
outstanding shares of Common Stock on 12/31/96.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES
The following table provides information as to options exercised by each
of the named executive officers of ACNielsen during 1996, and the number of
securities underlying unexercised options and the value of unexercised
in-the-money options at fiscal year-end.
(a) (b) (c) (d) (e)
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS/SARS AT FISCAL IN-THE-MONEY OPTIONS/SARS
ACQUIRED VALUE YEAR-END (2)(#) AT FISCAL YEAR-END (3)($)
ON EXERCISE REALIZED(1) -------------------------- --------------------------
NAME (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------- ----------- ---------- ----------- ------------- ----------- -------------
Nicholas L. Trivisonno 0 0 22,536 717,609 0 0
Robert J Lievense (1) (1) 103,862 502,660 18,049 25,915
Michael P. Connors 0 0 15,660 421,989 10,478 31,444
Earl H. Doppelt 0 0 80,861 423,464 18,127 18,131
Robert J. Chrenc 0 0 0 325,000 0 0
- ----------
(1) Prior to the Spin-Off, Mr. Lievense exercised Dun & Bradstreet options for
12,541 Dun & Bradstreet shares. The value realized was $183,523.
(2) No SARs were outstanding at December 31, 1996.
(3) The values shown equal the difference between the exercise price of
unexercised in-the-money options and the average of the high and low
trading prices of ACNielsen Common Stock on December 31, 1996. Options are
in-the-money if the fair market value of the Common Stock exceeds the
exercise price of the option.
23
LONG-TERM INCENTIVE PLANS -- AWARDS IN LAST FISCAL YEAR
The following table shows the target award opportunities set during the
last fiscal year under the ACNielsen Senior Executive Incentive Plan.
(a) (b) (c) (d) (e) (f)
PERFORMANCE ESTIMATED FUTURE PAYOUTS
NUMBER OF OR OTHER UNDER NON-STOCK PRICE-BASED PLANS (2)
SHARES, UNITS PERIOD UNTIL ----------------------------------------
OR OTHER MATURATION THRESHOLD($) TARGET($) MAXIMUM($)
NAME RIGHTS (1) ($) OR PAYOUT (0%) (100%) (100%)
- ---------------------- -------------- ---------- ----------- --------- ---------
Nicholas L. Trivisonno 750,000 Two Years 0 750,000 750,000
Robert J Lievense 550,000 Two Years 0 550,000 550,000
Michael P. Connors 500,000 Two Years 0 500,000 500,000
Earl H. Doppelt 400,000 Two Years 0 400,000 400,000
Robert J. Chrenc 400,000 Two Years 0 400,000 400,000
- ----------
(1) The material terms of these grants are described in the Committee report.
Awards will be paid in cash, stock, or a combination of both, at the
Committee's discretion, at the expiration of the two-year performance
period.
(2) Awards may range from 0 to 100% of the nominal grant value based on
achievements within a range of performance goals.
ACNIELSEN RETIREMENT BENEFITS
The following table sets forth the estimated average annual benefits
payable under the ACNielsen Corporation Supplemental Executive Retirement Plan
("SERP") to persons in specified average final compensation and credited service
classifications upon retirement at age 65. Amounts shown in the table also
include (i) U.S. Social Security benefits, (ii) benefits payable under the
ACNielsen Corporation Balance Account for Retirement Plan and the ACNielsen
Corporation Retirement Benefit Excess Plan (qualified and excess defined benefit
plans, respectively, the benefits of which are not determined with reference to
final average compensation), and (iii) benefits, if any, payable under
predecessor plans of Dun & Bradstreet, all of which would be deducted in
calculating benefits payable under the SERP.
SERP benefits, which vest after five years of credited service, are
calculated as 5% of average final compensation per year, for the first ten years
of credited service, and 2% per year for the next five years, up to a maximum of
60% of average final compensation after 15 years of credited service. Benefits
payable under the SERP are greater than benefits payable under ACNielsen's
qualified and excess defined benefit plans.
ESTIMATED AGGREGATE ANNUAL ACNIELSEN RETIREMENT
AVERAGE BENEFIT ASSUMING CREDITED SERVICE OF:
FINAL ----------------------------------------------------
COMPENSATION 5 YEARS 10 YEARS 15 YEARS 20 YEARS
- ------------ -------- -------- -------- --------
$ 550,000 ............................ $137,500 $275,000 $330,000 $330,000
700,000 ............................ 175,000 350,000 420,000 420,000
850,000 ............................ 212,500 425,000 510,000 510,000
1,000,000 ............................ 250,000 500,000 600,000 600,000
1,150,000 ............................ 287,500 575,000 690,000 690,000
1,300,000 ............................ 325,000 650,000 780,000 780,000
1,450,000 ............................ 362,500 725,000 870,000 870,000
1,600,000 ............................ 400,000 800,000 960,000 960,000
The number of years of credited service for Messrs. Trivisonno, Lievense,
Connors, Doppelt and Chrenc are, respectively, one, seven, one, two and zero.
24
Compensation for the purpose of determining SERP benefits consists of base
salary and regular annual cash bonuses. Severance pay, income derived from
equity-based awards and other forms of special remuneration are excluded
(including bonuses based on a performance period of longer than one year).
For 1996, pensionable earnings under the SERP do not include accelerated
long-term and other special bonuses paid by Dun & Bradstreet to the named
executive officers, which were included in the annual compensation column in the
Summary Compensation Table. The following amounts are deemed pensionable
earnings under the SERP for 1996. They consist of 1996 base salary and, for all
named officers other than Mr. Chrenc, the 1995 bonus paid in 1996 and the 1996
accelerated annual bonus paid in October of 1996 by Dun & Bradstreet: $858,334
for Mr. Trivisonno, $968,818 for Mr. Lievense, $670,846 for Mr. Connors,
$788,626 for Mr. Doppelt and $204,167 for Mr. Chrenc.
Average final compensation is defined as the highest average annual
compensation during five consecutive twelve-month periods in the last ten
consecutive twelve-month periods of the member's credited service. The benefits
shown in the table above are calculated on a straight-life annuity basis.
CHANGE IN CONTROL SEVERANCE AGREEMENTS
The Company has entered into agreements with the executive officers named
in the Summary Compensation Table providing severance benefits in the event of a
termination of employment in the circumstances described below following a
"change in control" (as defined in the agreements) of the Company. The
agreements were effective as of November 1, 1996 and remain in effect through
December 31, 1999. On each January 1st thereafter, the agreement automatically
extends for an additional year unless notice is given to the contrary by the
Company prior to the preceding September 30th. Following the end of the month in
which a change in control occurs, the agreements will remain in effect for no
more than an additional 15 months (the "Protected Period").
Benefits become payable in the event the executive is terminated during
the Protected Period without "cause" (generally, the executive's willful and
continued failure to perform his duties or his engaging in conduct that is
materially injurious to the Company) or the executive terminates employment
during that period for "good reason" (generally, an unfavorable change in
employment status, reduction in compensation or benefits, required relocation or
the lapse of 12 months following the change in control). The benefits payable
under the agreements include (i) a lump sum amount equal to three times the sum
of the executive's annual base salary and annual bonus, (ii) full vesting under
the SERP and crediting of the maximum number of years of service for purposes of
determining the amount of retirement benefits, (iii) a pro-rated portion of the
executive's annual target bonus and a full target bonus payable with respect to
any performance period longer than one year, (iv) cash reimbursement up to 20%
of annual compensation (but no more than $100,000) for outplacement expenses,
(v) life and health insurance coverage for up to 36 months, and (vi) retiree
life and medical insurance beginning at age 55. In addition, the executive is
entitled to a gross-up payment from the Company to cover any required excise
taxes (and any income taxes on the gross-up amount) payable by the executive as
a result of the change in control.
A change in control will generally be deemed to have occurred under the
following circumstances: (i) an acquisition by any person of 20% of the combined
voting power of the Company's securities, (ii) during any period of twenty-four
months a majority of the Company's Board of Directors ceases to consist of (x)
directors in office at the beginning of such period or (y) directors whose
election was approved by two-thirds of the directors in office at the beginning
of the period or by directors whose election was so approved, (iii) the
Company's merger or consolidation with another entity (other than one in which
the Company's shares outstanding prior to the merger represent more than 66 2/3%
of the voting power of the surviving company and no shareholder holds 20% or
more of such voting power) or (iv) the liquidation or sale of substantially all
of the Company's assets.
EXECUTIVE TRANSITION PLAN
The ACNielsen Corporation Executive Transition Plan ("ETP") provides
severance benefits to the Chief Executive Officer of the Company and other
executives he designates, including those named in the Summary Compensation
Table. The ETP generally provides for the payment of severance benefits if the
employment of a covered executive terminates by reason of a reduction in force,
job elimination, unsatisfactory job performance or a mutually acceptable
resignation. In the event of an eligible termination, the executive will be paid
104 weeks of salary
25
continuation consisting of such executive's annual base salary (paid at the same
payroll intervals applicable to active employees) and annual incentive
opportunity for the year of termination (pro-rated to reflect its payment at the
same payroll intervals as salary). If, however, the executive is terminated by
reason of unsatisfactory performance, the annual incentive opportunity will not
be included in such executive's salary continuation payments.
In addition, the ETP provides a covered executive with the following
benefits upon an eligible termination: (i) continued medical, dental and life
insurance coverage throughout the salary continuation period, (ii) unless
terminated for unsatisfactory performance, a pro-rated annual bonus will be paid
for the period of employment if the applicable performance target is met, (iii)
unless terminated for unsatisfactory performance, a pro-rated long-term bonus
will be paid for the period of employment if the applicable performance target
is met and the executive is employed for at least half the period of the
relevant performance cycle and (iv) in certain instances, outplacement services
and financial counseling. The ETP gives the Chief Executive Officer the
discretion to increase or decrease ETP benefits for executives other than the
Chief Executive Officer, subject to the review of any such decision with the
Compensation Committee. The Compensation Committee has this discretion with
respect to the Chief Executive Officer.
The ETP may not be amended during the one year period following a change
in control of the Company (as defined in the change in control agreements). Any
benefits payable under the ETP, however, will be offset by any other severance
payments made to a covered executive by the Company including, but not limited
to, amounts paid pursuant to the change in control agreements.
CERTAIN OTHER TRANSACTIONS
In connection with the launch of ACNielsen, the executive officers named
in the Summary Compensation Table decided to make significant equity purchases
of ACNielsen stock for their own accounts. Accordingly, on November 4, 1996, the
first day of regular way trading in ACNielsen stock, the following stock
purchases (with the total amounts invested) were made in open market
transactions by such officers: Mr. Trivisonno--45,607 shares ($720,000); Mr.
Lievense--28,504 shares ($450,000); Mr. Connors--28,504 shares ($450,000); Mr.
Doppelt--20,523 shares ($324,000); and Mr. Chrenc--20,523 shares ($324,000). In
connection with such purchases, the officers, other than Mr. Trivisonno,
obtained personal, full-recourse loans for the amount of the purchases from a
commercial bank and the Company guaranteed such loans. The guaranty with respect
to each loan can be called upon a default by the individual borrower.
COMPENSATION OF DIRECTORS
Cash Compensation. In 1996, each director not employed by the Company (a
"Non-Employee Director") who was elected a director on October 16, 1996 was paid
a retainer of $12,500. Mr. Holland, who was elected a director on December 19,
1996, was paid a retainer of $4,200. In addition, each Non-Employee Director was
paid a fee of $1,000 for each Board or Committee meeting attended in 1996 and
each Non-Employee Director who was Chairman of a Board Committee was paid a 1996
Chairman's fee of $3,000. Directors employed by the Company receive no retainers
or fees.
Under the director compensation program approved by the Board of
Directors, the following fees and retainers will be payable to Non-Employee
Directors in 1997: (i) an annual retainer of $25,000; (ii) an annual Committee
Chairman fee of $3,000; and (iii) meeting fees of $1,000 for each Board or
Committee meeting attended.
Deferred Compensation Plan. Non-Employee Directors may elect to defer all
or a specified part of the retainer and fees pursuant to the 1996 ACNielsen
Corporation Non-Employee Directors' Deferred Compensation Plan (the "Deferred
Compensation Plan"). Under this plan, these directors can defer compensation
into a cash account and/or a deferred stock account. Payment of deferred amounts
and applicable interest or dividends can be deferred until the first business
day of the calendar year immediately following the date on which a deferring
director terminates service as a director. Payments from a deferred cash account
are made in cash and payments from a deferred stock account are made in shares
of ACNielsen Common Stock.
Directors' Stock Incentive Plan. Under the terms of the 1996 ACNielsen
Corporation Non-Employee Directors' Stock Incentive Plan (the "Directors'
Incentive Plan"), the Compensation Committee may grant a
26
Non-Employee Director such number of stock options and/or such number of shares
of ACNielsen restricted stock as the Committee may, in its sole discretion,
determine.
In 1996, each Non-Employee Director was granted 10,000 stock options under
the Directors' Incentive Plan with an exercise price equal to the fair market
value of a share of ACNielsen Common Stock on the date of grant (the "Grant
Date"). In general, one-sixth of such options become exercisable each year
beginning one year after the Grant Date and the options expire on the tenth
anniversary of the Grant Date. One-half of any unvested options become
exercisable if the Company's stock price reaches 150% of the exercise price for
five consecutive trading days and any remaining unvested options become
exercisable if the Company's stock price reaches 200% of the exercise price for
five consecutive trading days. Under the director compensation program approved
by the Board of Directors, it is anticipated that, after the initial grant of
10,000 stock options, no additional option grants will be made for two years
from the Grant Date and that additional annual grants will be for 5,000 options.
In connection with the launch of ACNielsen, a special restricted stock
grant, equivalent in value to $30,000 on the date of grant, was made in 1996 to
each Non-Employee Director. In general, the restricted stock vests on the fifth
anniversary of the grant date. No additional grants of restricted stock are
currently anticipated.
Change in Control. The Deferred Compensation Plan and the Directors'
Incentive Plan provide that, in the event of a "change in control" (as defined
under "Change in Control Severance Agreements" above) of ACNielsen, the
Compensation Committee may, in its sole discretion, take such actions, if any,
as it deems necessary or desirable with respect to any Awards (as hereinafter
defined) as of the date of the consummation of the change in control including,
without limitation, (i) the acceleration of an Award, (ii) the payment of a cash
amount in exchange for the cancellation of an Award and/or (iii) the issuance of
substitute Awards that will substantially preserve the value, rights and
benefits of any affected Awards previously granted under each such plan.
For purposes of the Deferred Compensation Plan, an Award means the shares
or cash deferred pursuant to such plan. For purposes of the Directors' Incentive
Plan, an Award means a stock option or share of restricted stock granted
pursuant to such plan.
The Company has no retirement plan for Non-Employee Directors.
OTHER MATTERS
ACNielsen knows of no matters, other than those referred to herein, which
will be presented at the meeting. If, however, any other appropriate business
should properly be presented at the meeting, the persons named in the enclosed
form of proxy will vote the proxies in accordance with their best judgment.
SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Shareholder proposals intended to be presented at the ACNielsen Annual
Meeting of Shareholders in 1998 must be received by ACNielsen no later than
November 12, 1997. Shareholders should note that, in addition to applicable SEC
rules and regulations, ACNielsen's by-laws specify certain time limitations,
notice requirements and other procedures applicable to the submission of
nominations and other matters to be brought before an Annual or Special Meeting
of the Company.
March 11, 1997
27
EXHIBIT A
1996 ACNIELSEN CORPORATION
KEY EMPLOYEES' STOCK INCENTIVE PLAN
1. PURPOSE OF THE PLAN
The purpose of the Plan is to aid the Company and its Subsidiaries in
securing and retaining key employees of outstanding ability and to motivate such
employees to exert their best efforts on behalf of the Company and its
Subsidiaries by providing incentives through the granting of Awards. The Company
expects that it will benefit from the added interest which such key employees
will have in the welfare of the Company as a result of their proprietary
interest in the Company's success.
2. DEFINITIONS
The following capitalized terms used in the Plan have the respective
meanings set forth in this Section:
(a) Act: The Securities Exchange Act of 1934, as amended, or any
successor thereto.
(b) Award: An Option, Stock Appreciation Right or Other Stock-Based
Award granted pursuant to the Plan.
(c) Beneficial Owner: As such term is defined in Rule 13d-3 under
the Act (or any successor rule thereto).
(d) Board: The Board of Directors of the Company.
(e) Change in Control: The occurrence of any of the following
events:
(i) any Person (other than the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company), becomes the Beneficial
Owner, directly or indirectly, of securities of the Company
representing 20% or more of the combined voting power of the
Company's then-outstanding securities;
(ii) during any period of twenty-four months (not including
any period prior to the Effective Date), individuals who at the
beginning of such period constitute the Board, and any new director
(other than (A) a director nominated by a Person who has entered
into an agreement with the Company to effect a transaction described
in Sections 2(e)(i), (iii) or (iv) of the Plan, (B) a director
nominated by any Person (including the Company) who publicly
announces an intention to take or to consider taking actions
(including, but not limited to, an actual or threatened proxy
contest) which if consummated would constitute a Change in Control
or (C) a director nominated by any Person who is the Beneficial
Owner, directly or indirectly, of securities of the Company
representing 10% or more of the combined voting power of the
Company's securities) whose election by the Board or nomination for
election by the Company's stockholders was approved in advance by a
vote of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the period or
whose election or nomination for election was previously so
approved, cease for any reason to constitute at least a majority
thereof;
(iii) the stockholders of the Company approve any transaction
or series of transactions under which the Company is merged or
consolidated with any other company, other than a merger or
consolidation (A) which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than 66 2/3%
of the combined voting power of the voting securities of the Company
or such surviving entity outstanding immediately after such merger
or consolidation and (B) after which no Person holds 20% or more of
the combined voting power of the then-outstanding securities of the
Company or such surviving entity; or
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(iv) the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the
Company's assets.
(f) Code: The Internal Revenue Code of 1986, as amended, or any
successor thereto.
(g) Committee: The Compensation Committee of the Board.
(h) Company: ACNielsen Corporation, a Delaware corporation.
(i) D&B: The Dun & Bradstreet Corporation, a Delaware corporation.
(j) Disability: Inability to engage in any substantial gainful
activity by reason of a medically determinable physical or mental
impairment which constitutes a permanent and total disability, as defined
in Section 22(e)(3) of the Code (or any successor section thereto). The
determination whether a Participant has suffered a Disability shall be
made by the Committee based upon such evidence as it deems necessary and
appropriate. A Participant shall not be considered disabled unless he or
she furnishes such medical or other evidence of the existence of the
Disability as the Committee, in its sole discretion, may require.
(k) Effective Date: The date on which the Plan takes effect, as
defined pursuant to Section 17 of the Plan.
(l) Fair Market Value: On a given date, the arithmetic mean of the
high and low prices of the Shares as reported on such date on the
Composite Tape of the principal national securities exchange on which such
Shares are listed or admitted to trading, or, if no Composite Tape exists
for such national securities exchange on such date, then on the principal
national securities exchange on which such Shares are listed or admitted
to trading, or, if the Shares are not listed or admitted on a national
securities exchange, the arithmetic mean of the per Share closing bid
price and per Share closing asked price on such date as quoted on the
National Association of Securities Dealers Automated Quotation System (or
such market in which such prices are regularly quoted), or, if there is no
market on which the Shares are regularly quoted, the Fair Market Value
shall be the value established by the Committee in good faith. If no sale
of Shares shall have been reported on such Composite Tape or such national
securities exchange on such date or quoted on the National Association of
Securities Dealers Automated Quotation System on such date, then the
immediately preceding date on which sales of the Shares have been so
reported or quoted shall be used.
(m) LSAR: A limited stock appreciation right granted pursuant to
Section 8(d) of the Plan.
(n) Other Stock-Based Awards: Awards granted pursuant to Section 9
of the Plan.
(o) Option: A stock option granted pursuant to Section 7 of the
Plan.
(p) Option Price: The purchase price per Share of an Option, as
determined pursuant to Section 7(a) of the Plan.
(q) Participant: An individual who is selected by the Committee to
participate in the Plan pursuant to Section 5 of the Plan.
(r) Performance-Based Awards: Certain Other Stock-Based Awards
granted pursuant to Section 9(b) of the Plan.
(s) Person: As such term is used for purposes of Section 13(d) or
14(d) of the Act (or any successor section thereto).
(t) Plan: The 1996 ACNielsen Corporation Key Employees' Stock
Incentive Plan.
(u) Retirement: Termination of employment with the Company or a
Subsidiary after such Participant has attained age 55 and ten years of
service with the Company; or, with the prior written consent of the
Committee that such termination be treated as a Retirement hereunder,
termination of employment under other circumstances.
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(v) Shares: Shares of common stock, par value $0.01 per Share, of
the Company.
(w) Spinoff Date: The date on which the Shares that are owned by D&B
are distributed to the holders of record of shares of D&B.
(x) Stock Appreciation Right: A stock appreciation right granted
pursuant to Section 8 of the Plan.
(y) Subsidiary: A subsidiary corporation, as defined in Section
424(f) of the Code (or any successor section thereto).
3. SHARES SUBJECT TO THE PLAN
The total number of Shares which may be issued under the Plan is
12,000,000. The maximum number of Shares for which Awards may be granted during
a calendar year to any Participant shall be 700,000. The Shares may consist, in
whole or in part, of unissued Shares or treasury Shares. The issuance of Shares
or the payment of cash upon the exercise of an Award shall reduce the total
number of Shares available under the Plan, as applicable. Shares which are
subject to Awards which terminate or lapse may be granted again under the Plan.
4. ADMINISTRATION
The Plan shall be administered by the Committee, which may delegate its
duties and powers in whole or in part to any subcommittee thereof consisting
solely of at least two individuals who are each "non-employee directors" within
the meaning of Rule 16b-3 under the Act (or any successor rule thereto) and
"outside directors" within the meaning of Section 162(m) of the Code (or any
successor section thereto). The Committee is authorized to interpret the Plan,
to establish, amend and rescind any rules and regulations relating to the Plan,
and to make any other determinations that it deems necessary or desirable for
the administration of the Plan. The Committee may correct any defect or supply
any omission or reconcile any inconsistency in the Plan in the manner and to the
extent the Committee deems necessary or desirable. Any decision of the Committee
in the interpretation and administration of the Plan, as described herein, shall
lie within its sole and absolute discretion and shall be final, conclusive and
binding on all parties concerned (including, but not limited to, Participants
and their beneficiaries or successors). The Committee shall require payment of
any amount it may determine to be necessary to withhold for federal, state,
local or other taxes as a result of the exercise of an Award. Unless the
Committee specifies otherwise, the Participant may elect to pay a portion or all
of such withholding taxes by (a) delivery in Shares or (b) having Shares
withheld by the Company from any Shares that would have otherwise been received
by the Participant. The number of Shares so delivered or withheld shall have an
aggregate Fair Market Value sufficient to satisfy the applicable withholding
taxes. If the chief executive officer of the Company is a member of the Board,
the Board by specific resolution may constitute such chief executive officer as
a committee of one which shall have the authority to grant Awards of up to an
aggregate of 10,000 Shares in each calendar year to each Participant who is not
subject to the rules promulgated under Section 16 of the Act (or any successor
section thereto); provided, however, that (a) such chief executive officer shall
notify the Committee of any such grants made pursuant to this Section 4 and (b)
the chairman of the Committee shall approve any such grants made pursuant to
this Section 4.
5. ELIGIBILITY
Key employees (but not members of the Committee or any person who serves
only as a director) of the Company and its Subsidiaries, who are from time to
time responsible for the management, growth and protection of the business of
the Company and its Subsidiaries, are eligible to be granted Awards under the
Plan. Participants shall be selected from time to time by the Committee, in its
sole discretion, from among those eligible, and the Committee shall determine,
in its sole discretion, the number of Shares to be covered by the Awards granted
to each Participant.
6. LIMITATIONS
No Award may be granted under the Plan after the tenth anniversary of the
Effective Date, but Awards theretofore granted may extend beyond that date.
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7. TERMS AND CONDITIONS OF OPTIONS
Options granted under the Plan shall be, as determined by the Committee,
non-qualified, incentive or other stock options for federal income tax purposes,
as evidenced by the related Award agreements, and shall be subject to the
foregoing and the following terms and conditions and to such other terms and
conditions, not inconsistent therewith, as the Committee shall determine:
(a) Option Price. The Option Price per Share shall be determined by
the Committee, but shall not be less than 100% of the Fair Market Value of
the Shares on the date an Option is granted.
(b) Exercisability. Options granted under the Plan shall be
exercisable at such time and upon such terms and conditions as may be
determined by the Committee, but in no event shall an Option be
exercisable more than ten years after the date it is granted.
(c) Exercise of Options. Except as otherwise provided in the Plan or
in an Award agreement, an Option may be exercised for all, or from time to
time any part, of the Shares for which it is then exercisable. For
purposes of Section 7 of the Plan, the exercise date of an Option shall be
the later of the date a notice of exercise is received by the Company and,
if applicable, the date payment is received by the Company pursuant to
clauses (i), (ii) or (iii) in the following sentence. The purchase price
for the Shares as to which an Option is exercised shall be paid to the
Company in full at the time of exercise at the election of the Participant
(i) in cash, (ii) in Shares having a Fair Market Value equal to the
aggregate Option Price for the Shares being purchased and satisfying such
other requirements as may be imposed by the Committee, (iii) partly in
cash and partly in such Shares, (iv) through the withholding of Shares
(which would otherwise be delivered to the Participant) with an aggregate
Fair Market Value on the exercise date equal to the aggregate Option Price
or (v) through the delivery of irrevocable instructions to a broker to
deliver promptly to the Company an amount equal to the aggregate Option
Price for the Shares being purchased. No Participant shall have any rights
to dividends or other rights of a stockholder with respect to Shares
subject to an Option until the Participant has given written notice of
exercise of the Option, paid in full for such Shares and, if applicable,
has satisfied any other conditions imposed by the Committee pursuant to
the Plan.
(d) Exercisability Upon Termination of Employment by Death. If a
Participant's employment with the Company and its Subsidiaries terminates
by reason of death after the date of grant of an Option, (i) the
unexercised portion of such Option shall immediately vest in full and (ii)
such portion may thereafter be exercised during the shorter of (A) the
remaining stated term of the Option or (B) five years after the date of
death.
(e) Exercisability Upon Termination of Employment by Disability or
Retirement. If a Participant's employment with the Company and its
Subsidiaries terminates by reason of Disability or Retirement after the
date of grant of an Option, (i) the unexercised portion of such Option
shall immediately vest in full and (ii) such portion may thereafter be
exercised during the shorter of (A) the remaining stated term of the
Option or (B) five years after the date of such termination of employment;
provided, however, that if a Participant dies within a period of five
years after such termination of employment, an unexercised Option may
thereafter be exercised, during the shorter of (i) the remaining stated
term of the Option or (ii) the period that is the longer of (A) five years
after the date of such termination of employment or (B) one year after the
date of death.
(f) Effect of Other Termination of Employment. Except as otherwise
provided in an Award agreement, if a Participant's employment with the
Company and its Subsidiaries terminates for any reason other than death,
Disability or Retirement after the date of grant of an Option as described
above, an unexercised Option may thereafter be exercised during the period
ending 90 days after the date of such termination of employment, but only
to the extent to which such Option was exercisable at the time of such
termination of employment.
8. TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS
(a) Grants. The Committee also may grant (i) a Stock Appreciation
Right independent of an Option or (ii) a Stock Appreciation Right in
connection with an Option, or a portion thereof. A Stock Appreciation
Right
A-4
granted pursuant to clause (ii) of the preceding sentence (A) may be
granted at the time the related Option is granted or at any time prior to
the exercise or cancellation of the related Option, (B) shall cover the
same Shares covered by an Option (or such lesser number of Shares as the
Committee may determine) and (C) shall be subject to the same terms and
conditions as such Option except for such additional limitations as are
contemplated by this Section 8 (or such additional limitations as may be
included in an Award agreement).
(b) Terms. The exercise price per Share of a Stock Appreciation
Right shall be an amount determined by the Committee but in no event shall
such amount be less than the greater of (i) the Fair Market Value of a
Share on the date the Stock Appreciation Right is granted or, in the case
of a Stock Appreciation Right granted in conjunction with an Option, or a
portion thereof, the Option Price of the related Option and (ii) an amount
permitted by applicable laws, rules, by-laws or policies of regulatory
authorities or stock exchanges. Each Stock Appreciation Right granted
independent of an Option shall entitle a Participant upon exercise to an
amount equal to (i) the excess of (A) the Fair Market Value on the
exercise date of one Share over (B) the exercise price per Share, times
(ii) the number of Shares covered by the Stock Appreciation Right. Each
Stock Appreciation Right granted in conjunction with an Option, or a
portion thereof, shall entitle a Participant to surrender to the Company
the unexercised Option, or any portion thereof, and to receive from the
Company in exchange therefor an amount equal to (i) the excess of (A) the
Fair Market Value on the exercise date of one Share over (B) the Option
Price per Share, times (ii) the number of Shares covered by the Option, or
portion thereof, which is surrendered. The date a notice of exercise is
received by the Company shall be the exercise date. Payment shall be made
in Shares or in cash, or partly in Shares and partly in cash, valued at
such Fair Market Value, all as shall be determined by the Committee. Stock
Appreciation Rights may be exercised from time to time upon actual receipt
by the Company of written notice of exercise stating the number of Shares
subject to an exercisable Option with respect to which the Stock
Appreciation Right is being exercised. No fractional Shares will be issued
in payment for Stock Appreciation Rights, but instead cash will be paid
for a fraction or, if the Committee should so determine, the number of
Shares will be rounded downward to the next whole Share.
(c) Limitations. The Committee may impose, in its discretion, such
conditions upon the exercisability or transferability of Stock
Appreciation Rights as it may deem fit.
(d) Limited Stock Appreciation Rights. The Committee may grant LSARs
that are exercisable upon the occurrence of specified contingent events.
Such LSARs may provide for a different method of determining appreciation,
may specify that payment will be made only in cash and may provide that
any related Awards are not exercisable while such LSARs are exercisable.
Unless the context otherwise requires, whenever the term "Stock
Appreciation Right" is used in the Plan, such term shall include LSARs.
9. OTHER STOCK-BASED AWARDS
(a) Generally. The Committee, in its sole discretion, may grant
Awards of Shares, Awards of restricted Shares and Awards that are valued
in whole or in part by reference to, or are otherwise based on the Fair
Market Value of, Shares ("Other Stock-Based Awards"). Such Other
Stock-Based Awards shall be in such form, and dependent on such
conditions, as the Committee shall determine, including, without
limitation, the right to receive one or more Shares (or the equivalent
cash value of such Shares) upon the completion of a specified period of
service, the occurrence of an event and/or the attainment of performance
objectives. Other Stock-Based Awards may be granted alone or in addition
to any other Awards granted under the Plan. Subject to the provisions of
the Plan, the Committee shall determine to whom and when Other Stock-Based
Awards will be made, the number of Shares to be awarded under (or
otherwise related to) such Other Stock-Based Awards; whether such Other
Stock-Based Awards shall be settled in cash, Shares or a combination of
cash and Shares; and all other terms and conditions of such Awards
(including, without limitation, the vesting provisions thereof).
(b) Performance-Based Awards. Notwithstanding anything to the
contrary herein, certain Other Stock-Based Awards granted under this
Section 9 may be granted in a manner which is deductible by the Company
under Section 162(m) of the Code (or any successor section thereto)
("Performance-Based Awards"). A Participant's Performance-Based Award
shall be determined based on the attainment of written performance goals
approved by the Committee for a performance period established by the
Committee (i) while the outcome
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for that performance period is substantially uncertain and (ii) no more
than 90 days after the commencement of the performance period to which the
performance goal relates or, if less, the number of days which is equal to
25 percent of the relevant performance period. The performance goals,
which must be objective, shall be based upon one or more of the following
criteria: (i) consolidated earnings before or after taxes (including
earnings before interest, taxes, depreciation and amortization); (ii) net
income; (iii) operating income; (iv) earnings per Share; (v) book value
per Share; (vi) return on stockholders' equity; (vii) expense management;
(viii) return on investment; (ix) improvements in capital structure; (x)
profitability of an identifiable business unit or product; (xi)
maintenance or improvement of profit margins; (xii) stock price; (xiii)
market share; (xiv) revenues or sales; (xv) costs; (xvi) cash flow; (xvii)
working capital and (xviii) return on assets. The foregoing criteria may
relate to the Company, one or more of its Subsidiaries or one or more of
its divisions or units, or any combination of the foregoing, and may be
applied on an absolute basis and/or be relative to one or more peer group
companies or indices, or any combination thereof, all as the Committee
shall determine. In addition, to the degree consistent with Section 162(m)
of the Code (or any successor section thereto), the performance goals may
be calculated without regard to extraordinary items. The maximum amount of
a Performance-Based Award to any Participant with respect to a fiscal year
of the Company shall be $6,000,000. The Committee shall determine whether,
with respect to a performance period, the applicable performance goals
have been met with respect to a given Participant and, if they have, to so
certify and ascertain the amount of the applicable Performance-Based
Award. No Performance-Based Awards will be paid for such performance
period until such certification is made by the Committee. The amount of
the Performance-Based Award actually paid to a given Participant may be
less than the amount determined by the applicable performance goal
formula, at the discretion of the Committee. The amount of the
Performance-Based Award determined by the Committee for a performance
period shall be paid to the Participant at such time as determined by the
Committee in its sole discretion after the end of such performance period;
provided, however, that a Participant may, if and to the extent permitted
by the Committee and consistent with the provisions of Section 162(m) of
the Code, elect to defer payment of a Performance-Based Award.
10. ADJUSTMENTS UPON CERTAIN EVENTS
Notwithstanding any other provisions in the Plan to the contrary, the
following provisions shall apply to all Awards granted under the Plan:
(a) Generally. In the event of any change in the outstanding Shares
after the Effective Date by reason of any Share dividend or split,
reorganization, recapitalization, merger, consolidation, spin-off,
combination or exchange of Shares or other corporate exchange, or any
distribution to stockholders of Shares other than regular cash dividends,
the Committee in its sole discretion and without liability to any person
may make such substitution or adjustment, if any, as it deems to be
equitable, as to (i) the number or kind of Shares or other securities
issued or reserved for issuance pursuant to the Plan or pursuant to
outstanding Awards, (ii) the Option Price and/or (iii) any other affected
terms of such Awards.
(b) Change in Control. Except as otherwise provided in an Award
agreement, in the event of a Change in Control, the Committee in its sole
discretion and without liability to any person may take such actions, if
any, as it deems necessary or desirable with respect to any Award
(including, without limitation, (i) the acceleration of an Award, (ii) the
payment of a cash amount in exchange for the cancellation of an Award
and/or (iii) the requiring of the issuance of substitute Awards that will
substantially preserve the value, rights and benefits of any affected
Awards previously granted hereunder) as of the date of the consummation of
the Change in Control.
11. NO RIGHT TO EMPLOYMENT
The granting of an Award under the Plan shall impose no obligation on the
Company or any Subsidiary to continue the employment of a Participant and shall
not lessen or affect the Company's or Subsidiary's right to terminate the
employment of such Participant.
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12. SUCCESSORS AND ASSIGNS
The Plan shall be binding on all successors and assigns of the Company and
a Participant, including without limitation, the estate of such Participant and
the executor, administrator or trustee of such estate, or any receiver or
trustee in bankruptcy or representative of the Participant's creditors.
13. NONTRANSFERABILITY OF AWARDS
An Award shall not be transferable or assignable by the Participant
otherwise than by will or by the laws of descent and distribution. During the
lifetime of a Participant, an Award shall be exercisable only by such
Participant. An Award exercisable after the death of a Participant may be
exercised by the legatees, personal representatives or distributees of the
Participant. Notwithstanding anything to the contrary herein, the Committee, in
its sole discretion, shall have the authority to waive this Section 13 (or any
part thereof) to the extent that this Section 13 (or any part thereof) is not
required under the rules promulgated under any law, rule or regulation
applicable to the Company.
14. AMENDMENTS OR TERMINATION
The Board may amend, alter or discontinue the Plan, but no amendment,
alteration or discontinuation shall be made which, (a) without the approval of
the stockholders of the Company, would (except as is provided in Section 10 of
the Plan), increase the total number of Shares reserved for the purposes of the
Plan or change the maximum number of Shares for which Awards may be granted to
any Participant or (b) without the consent of a Participant, would impair any of
the rights or obligations under any Award theretofore granted to such
Participant under the Plan; provided, however, that the Committee may amend the
Plan in such manner as it deems necessary to permit the granting of Awards
meeting the requirements of the Code or other applicable laws. Notwithstanding
anything to the contrary herein, the Board may not amend, alter or discontinue
the provisions relating to Section 10(b) of the Plan after the occurrence of a
Change in Control.
15. INTERNATIONAL PARTICIPANTS
With respect to Participants who reside or work outside the United States
of America and who are not (and who are not expected to be) "covered employees"
within the meaning of Section 162(m) of the Code, the Committee may, in its sole
discretion, amend the terms of the Plan or Awards with respect to such
Participants in order to conform such terms with the requirements of local law.
16. CHOICE OF LAW
The Plan shall be governed by and construed in accordance with the laws of
the State of New York applicable to contracts made and to be performed in the
State of New York.
17. EFFECTIVENESS OF THE PLAN
The Plan shall be effective as of the Spinoff Date. If the Plan is not
approved by the stockholders of the Company prior to the first anniversary of
the Spinoff Date, no Awards may be granted thereafter.
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EXHIBIT B
1996 ACNIELSEN CORPORATION
SENIOR EXECUTIVE INCENTIVE PLAN
1. PURPOSE OF THE PLAN
The purpose of the Plan is to advance the interests of the Company and its
stockholders by providing incentives in the form of periodic cash and/or
equity-based bonus awards to certain senior executive employees of the Company
and its subsidiaries, thereby motivating such executives to attain corporate
performance goals articulated underthe Plan.
2. DEFINITIONS
The following capitalized terms used in the Plan have the respective
meanings set forth in this Section:
(a) Act: The Securities Exchange Act of 1934, as amended, or any
successor thereto.
(b) Award: (i) A periodic cash bonus award granted pursuant to the
Plan or (ii) a periodic equity-based bonus award (A) issued pursuant to an
equity-based plan of the Company and (B) granted pursuant to the Plan.
(c) Beneficial Owner: As such term is defined in Rule 13d-3 under
the Act (or any successor rule thereto).
(d) Board: The Board of Directors of the Company.
(e) Change in Control: The occurrence of any of the following
events:
(i) any Person (other than the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as
their ownership of stock of the Company), becomes the Beneficial
Owner, directly or indirectly, of securities of the Company
representing 20% or more of the combined voting power of the
Company's then-outstanding securities;
(ii) during any period of twenty-four months (not including
any period prior to the Effective Date), individuals who at the
beginning of such period constitute the Board, and any new director
(other than (A) a director nominated by a Person who has entered
into an agreement with the Company to effect a transaction described
in Sections 2(e)(i), (iii) or (iv) of the Plan, (B) a director
nominated by any Person (including the Company) who publicly
announces an intention to take or to consider taking actions
(including, but not limited to, an actual or threatened proxy
contest) which if consummated would constitute a Change in Control
or (C) a director nominated by any Person who is the Beneficial
Owner, directly or indirectly, of securities of the Company
representing 10% or more of the combined voting power of the
Company's securities) whose election by the Board or nomination for
election by the Company's stockholders was approved in advance by a
vote of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the period or
whose election or nomination for election was previously so
approved, cease for any reason to constitute at least a majority
thereof;
(iii) the stockholders of the Company approve any transaction
or series of transactions under which the Company is merged or
consolidated with any other company, other than a merger or
consolidation (A) which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than 66 2/3%
of the combined voting power of the voting securities of the Company
or such surviving entity outstanding immediately after such merger
or consolidation and (B) after which no Person holds 20% or more of
the combined voting power of the then-outstanding securities of the
Company or such surviving entity; or
(iv) the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of
the Company's assets.
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(f) Code: The Internal Revenue Code of 1986, as amended, or any
successor thereto.
(g) Committee: The Compensation Committee of the Board.
(h) Company: ACNielsen Corporation, a Delaware corporation.
(i) D&B: The Dun & Bradstreet Corporation, a Delaware corporation.
(j) Effective Date: The date on which the Plan takes effect, as
defined pursuant to Section 13 of the Plan.
(k) Fair Market Value: On a given date, the arithmetic mean of the
high and low prices of the Shares as reported on such date on the
Composite Tape of the principal national securities exchange on which such
Shares are listed or admitted to trading, or, if no Composite Tape exists
for such national securities exchange on such date, then on the principal
national securities exchange on which such Shares are listed or admitted
to trading, or, if the Shares are not listed or admitted on a national
securities exchange, the arithmetic mean of the per Share closing bid
price and per Share closing asked price on such date as quoted on the
National Association of Securities Dealers Automated Quotation System (or
such market in which such prices are regularly quoted), or, if there is no
market on which the Shares are regularly quoted, the Fair Market Value
shall be the value established by the Committee in good faith. If no sale
of Shares shall have been reported on such Composite Tape or such national
securities exchange on such date or quoted on the National Association of
Securities Dealers Automated Quotation System on such date, then the
immediately preceding date on which sales of the Shares have been so
reported or quoted shall be used.
(l) Participant: A senior executive of the Company or any of its
Subsidiaries who (i) is (or is anticipated to become) a "covered employee"
as defined in Section 162(m) of the Code (or any successor section
thereof) and (ii) is selected by the Committee to participate in the Plan.
(m) Person: As such term is used for purposes of Section 13(d) or
14(d) of the Act (or any successor section thereto).
(n) Plan: The 1996 ACNielsen Corporation Senior Executive Incentive
Plan.
(o) Shares: Shares of common stock, par value $0.01 per Share, of
the Company.
(p) Spinoff Date: The date on which the Shares that are owned by D&B
are distributed to the holders of record of shares of D&B.
(q) Subsidiary: A subsidiary corporation, as defined in Section
424(f) of the Code (or any successor section thereto).
3. ADMINISTRATION
The Plan shall be administered by the Committee or such other persons
designated by the Board. The Committee may delegate its duties and powers in
whole or in part to any subcommittee thereof consisting solely of at least two
individuals who are each "non-employee directors" within the meaning of Rule
16b-3 of the Act (or any successor rule thereto) and "outside directors" within
the meaning of Section 162(m) of the Code (or any successor section thereto).
The Committee shall have the exclusive authority to select the senior executives
to be granted Awards under the Plan, to determine the size and terms of an Award
(subject to the limitations imposed on Awards in Section 5 below), to modify the
terms of any Award that has been granted (except for any modification that would
increase the amount of the Award payable to an executive), to determine the time
when Awards will be made and the performance period to which they relate, to
establish performance objectives in respect of such performance periods and to
certify that such performance objectives were attained; provided, however, that
any such action shall be consistent with the applicable provisions of Section
162(m) of the Code. The Committee is authorized to interpret the Plan, to
establish, amend and rescind any rules and regulations relating to the Plan, and
to make any other determinations that it deems necessary or
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desirable for the administration of the Plan. The Committee may correct
any defect or supply any omission or reconcile any inconsistency in the
Plan in the manner and to the extent the Committee deems necessary or
desirable. Any decision of the Committee in the interpretation and
administration of the Plan, as described herein, shall lie within its sole
and absolute discretion and shall be final, conclusive and binding on all
parties concerned. Determinations made by the Committee under the Plan
need not be uniform and may be made selectively among Participants,
whether or not such Participants are similarly situated. The Committee
shall have the right to deduct from any payment made under the Plan any
federal, state, local or foreign income or other taxes required by law to
be withheld with respect to such payment. Unless the Committee specifies
otherwise, the Participant may elect to pay a portion or all of such
withholding taxes by (a) delivery in Shares or (b) having Shares withheld
by the Company from any Shares that would have otherwise been received by
the Participant. The number of Shares so delivered or withheld shall have
an aggregate Fair Market Value sufficient to satisfy the applicable
withholding taxes.
4. ELIGIBILITY
Only Participants shall be eligible to receive awards under the Plan.
5. AWARDS
(a) Performance Goals. A Participant's Award shall be determined
based on the attainment of written performance goals approved by the
Committee for a performance period established by the Committee (i) while
the outcome for that performance period is substantially uncertain and
(ii) no more than 90 days after the commencement of the performance period
to which the performance goal relates or, if less, the number of days
which is equal to 25 percent of the relevant performance period. The
performance goals, which must be objective, shall be based upon one or
more of the following criteria: (i) consolidated earnings before or after
taxes (including earnings before interest, taxes, depreciation and
amortization); (ii) net income; (iii) operating income; (iv) earnings per
Share; (v) book value per Share; (vi) return on stockholders' equity;
(vii) expense management; (viii) return on investment; (ix) improvements
in capital structure; (x) profitability of an identifiable business unit
or product; (xi) maintenance or improvement of profit margins; (xii) stock
price; (xiii) market share; (xiv) revenues or sales; (xv) costs; (xvi)
cash flow; (xvii) working capital and (xviii) return on assets. The
foregoing criteria may relate to the Company, one or more of its
Subsidiaries or one or more of its divisions or units, or any combination
of the foregoing, and may be applied on an absolute basis and/or be
relative to one or more peer group companies or indices, or any
combination thereof, all as the Committee shall determine. In addition, to
the degree consistent with Section 162(m) of the Code (or any successor
section thereto), the performance goals may be calculated without regard
to extraordinary items. The maximum amount of an Award to any Participant
with respect to a fiscal year of the Company shall be $6,000,000.
(b) Payment. The Committee shall determine whether, with respect to
a performance period, the applicable performance goals have been met with
respect to a given Participant and, if they have, to so certify and
ascertain the amount of the applicable Award. No Awards will be paid for
such performance period until such certification is made by the Committee.
The amount of the Award actually paid to a given Participant may be less
than the amount determined by the applicable performance goal formula, at
the discretion of the Committee. The amount of the Award determined by the
Committee for a performance period shall be paid to the Participant at
such time as determined by the Committee in its sole discretion after the
end of such performance period; provided, however, that a Participant may,
if and to the extent permitted by the Committee and consistent with the
provisions of Section 162(m) of the Code, elect to defer payment of an
Award.
(c) Compliance with Section 162(m) of the Code. The provisions of
this Section 5 shall be administered and interpreted in accordance with
Section 162(m) of the Code to ensure the deductibility by the Company or
its Subsidiaries of the payment of Awards.
6. AMENDMENTS OR TERMINATION
The Board may amend, alter or discontinue the Plan, but no amendment,
alteration or discontinuation shall be made which would impair any of the rights
or obligations under any Award theretofore granted to a Participant under the
Plan without such Participant's consent; provided, however, that the Committee
may amend the Plan in such
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manner as it deems necessary to permit the granting of Awards meeting the
requirements of the Code or other applicable laws. Notwithstanding anything to
the contrary herein, the Board may not amend, alter or discontinue the
provisions relating to Section 10(b)(ii) of the Plan after the occurrence of a
Change in Control.
7. NO RIGHT TO EMPLOYMENT
Neither the Plan nor any action taken hereunder shall be construed as
giving any Participant or other person any right to continue to be employed by
or perform services for the Company or any Subsidiary, and the right to
terminate the employment of or performance of services by any Participant at any
time and for any reason is specifically reserved to the Company and its
Subsidiaries.
8. NONTRANSFERABILITY OF AWARDS
An Award shall not be transferable or assignable by the Participant
otherwise than by will or by the laws of descent and distribution.
9. REDUCTION OF AWARDS
Notwithstanding anything to the contrary herein, the Committee, in its
sole discretion (but subject to applicable law), may reduce any amounts payable
to any Participant hereunder in order to satisfy any liabilities owed to the
Company or any of its Subsidiaries by the Participant.
10. ADJUSTMENTS UPON CERTAIN EVENTS
(a) Generally. In the event of any change in the outstanding Shares
after the Effective Date by reason of any Share dividend or split,
reorganization, recapitalization, merger, consolidation, spin-off,
combination or exchange of Shares or other corporate exchange, or any
distribution to stockholders of Shares other than regular cash dividends,
the Committee in its sole discretion and without liability to any person
may make such substitution or adjustment, if any, as it deems to be
equitable, as to (i) the number or kind of Shares or other securities
issued or reserved for issuance pursuant to the Plan or pursuant to
outstanding Awards and/or (ii) any other affected terms of such Awards.
(b) Change in Control. Notwithstanding any other provisions in the
Plan to the contrary, in the event of a Change in Control, (i) the
Committee in its sole discretion and without liability to any person may
take such actions, if any, as it deems necessary or desirable with respect
to any Award (including, without limitation, (A) the acceleration of an
Award, (B) the payment of a cash amount in exchange for the cancellation
of an Award and/or (C) the requiring of the issuance of substitute Awards
that will substantially preserve the value, rights and benefits of any
affected Awards previously granted hereunder) as of the date of the
consummation of the Change in Control and (ii) any Participant who, as a
result of a Change in Control, receives payments pursuant to a
Change-in-Control agreement shall receive, subject to the same terms and
conditions under which such payments are made, an amount in cash equal to
(A) the annual target bonus under the Plan for the year in which the
Change in Control occurs, multiplied by a fraction, (I) the numerator of
which equals the number of full or partial days in such annual performance
period during which he or she was employed by the Company and (II) the
denominator of which is 365, and (B) the entire target bonus opportunity
with respect to all other performance periods in progress under this Plan
at the time of his or her termination of employment from the Company.
11. MISCELLANEOUS PROVISIONS
The Company is the sponsor and legal obligor under the Plan and shall make
all payments hereunder, other than any payments to be made by any of the
Subsidiaries (in which case such payments shall be made by such Subsidiary, as
appropriate). The Company shall not be required to establish any special or
separate fund or to make any other
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segregation of assets to ensure the payment of any amounts under the Plan, and
the Participants' rights to the payment hereunder shall be no greater than the
rights of the Company's (or subsidiary's) unsecured creditors. All expenses
involved in administering the Plan shall be borne by the Company.
12. CHOICE OF LAW
The Plan shall be governed by and construed in accordance with the laws of
the State of New York applicable to contracts made and to be performed in the
State of New York.
13. EFFECTIVENESS OF THE PLAN
The Plan shall be effective as of the Spinoff Date. If the Plan is not
approved by the stockholders of the Company prior to the first meeting of the
stockholders following the first anniversary of the Spinoff Date, no Awards
shall be payable or granted thereafter.
B-5
ACNIELSEN CORPORATION
PROXY/VOTING INSTRUCTIONS FOR THE ANNUAL MEETING TO BE HELD APRIL 16, 1997
AT 9:30 A.M. AT 1209 ORANGE STREET, WILMINGTON, DELAWARE
NICHOLAS L TRIVISONNO, ROBERT J. CHRENC and EARL H. DOPPELT, or any of
them, with full power of substitution, are hereby appointed proxies to vote all
the shares of Common Stock of ACNielsen Corporation ("Common Stock") which the
undersigned is entitled to vote at the Annual Meeting of Shareholders on April
16, 1997, and at any adjournment thereof. Participants in the benefit plans
listed in the "Notice to Participants in Certain Benefit Plans" on the back of
this card are referred to such notice for information on the voting of shares
held in such plans.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ELECTION OF ALL NOMINEES
IDENTIFIED IN ITEM (1) AND FOR ITEMS (2), (3) AND (4).
(1) Election of four Class I Directors for a three-year term expiring at the
2000 Annual Meeting of Shareholders. Nominees: Donald W. Griffin, Robert
M. Hendrickson, Brian B. Pemberton and Nicholas L Trivisonno.
|_| FOR all nominees listed above, except |_| WITHHOLD authority to
vote withheld from the following vote for all nominees
nominees (if any):
_____________________________________
(2) Ratification of the selection of Arthur Andersen LLP as independent public
accountants to audit the Company's consolidated financial statements for
1997. Mark only one.
FOR |_| AGAINST |_| ABSTAIN |_|
(3) Approval of the 1996 ACNielsen Corporation Key Employees' Stock Incentive
Plan. Mark only one.
FOR |_| AGAINST |_| ABSTAIN |_|
(4) Approval of the 1996 ACNielsen Corporation Senior Executive Incentive
Plan. Mark only one.
FOR |_| AGAINST |_| ABSTAIN |_|
(Please Turn Over and Sign)
ACNIELSEN CORPORATION
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS AND WILL BE VOTED AS
DIRECTED ON THE REVERSE SIDE OF THIS CARD. A PROXY WHICH IS SIGNED AND RETURNED
BY A SHAREHOLDER OF RECORD WITHOUT SPECIFICATION MARKED IN THE INSTRUCTION BOXES
WILL BE VOTED FOR ELECTION OF ALL NOMINEES IDENTIFIED IN ITEM (1), AND FOR ITEMS
(2), (3) AND (4). IF ANY OTHER MATTER IS PROPERLY BROUGHT BEFORE THE MEETING AND
SUBMITTED TO A VOTE, A PROXY WILL BE VOTED IN ACCORDANCE WITH THE JUDGMENT OF
THE PERSON(S) VOTING THE PROXY.
NOTICE TO PARTICIPANTS IN CERTAIN BENEFIT PLANS.
The trustee of (i) the ACNielsen Corporation Employee Stock Ownership Plan
(the "ESOP"), (ii) the ACNielsen Corporation Savings Plan (the "Savings Plan"),
(iii) the Dun & Bradstreet Profit Participation Plan, (iv) the DonTech Profit
Participation Plan, and (v) the Cognizant Corporation Savings Plan, has agreed
that this proxy will also serve as voting instructions from participants in such
plans who have plan contributions for their respective accounts invested in
Common Stock. Proxies covering shares in the plans must be received prior to
April 9,1997. If a proxy covering shares in the ESOP or Savings Plan has not
been received prior to April 9, 1997 or if it is signed and returned without
specification marked in the instruction boxes, the trustee of those plans will
vote those plan shares in the same proportion as the respective shares in such
plan for which it has received instructions, except as otherwise required by
law. Shares held by other plans and not voted by participants will be voted in
accordance with the terms of those plans.
Date______________________________, 1997
________________________________________
________________________________________
Signature(s)
Please sign exactly as name appears at
left. Joint owners should each sign.
Executors, administrators, trustees,
etc. should so indicate when signing and
sign as required by the authority held.
Proxy form begins on the reverse side.
Please vote, date, sign and return
immediately.