SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
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[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12
EDGAR ONLINE, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than Registrant)
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[EDGAR(R) ONLINE(R) LOGO]
June 27, 2003
Dear Stockholder:
On behalf of the Board of Directors of EDGAR Online, Inc., I cordially
invite you to attend our Annual Meeting of Stockholders, which will be held on
July 30, 2003 at 10:00 A.M. (local time) at our offices at 50 Washington Street,
Norwalk, Connecticut 06854.
At this year's meeting, you will vote on (i) the election of seven
directors; (ii) ratification of the appointment of KPMG LLP as independent
public accountants; and (iii) such other business as may properly come before
the Annual Meeting or any adjournments thereof. We have attached a notice of
meeting and a proxy statement that contains more information about these
proposals.
You will also find enclosed a proxy card appointing proxies to vote
your shares at the Annual Meeting. Please sign, date and return your proxy card
as soon as possible so that your shares can be represented and voted in
accordance with your instructions even if you cannot attend the Annual Meeting
in person.
Sincerely,
/s/ Marc Strausberg
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Marc Strausberg
Chairman of the Board
EDGAR ONLINE, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 30, 2003
TO THE STOCKHOLDERS OF EDGAR ONLINE, INC.:
We will hold the Annual Meeting of Stockholders (the "Annual Meeting")
of EDGAR Online, Inc., a Delaware corporation ("EDGAR Online" or the "Company"),
at the Company's offices, 50 Washington Street, Norwalk, Connecticut 06854 on
July 30, 2003 at 10:00 A.M. (local time) for the following purposes:
(1) ELECTION OF DIRECTORS. To elect seven members of the Board of
Directors to serve until the 2004 Annual Meeting of Stockholders or
until their respective successors are elected and qualified;
(2) RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS. To ratify the
appointment of KPMG LLP as independent public accountants of the
Company for the fiscal year ending December 31, 2003; and
(3) OTHER BUSINESS. To transact such other business as may properly
come before the Annual Meeting and any adjournment or postponement
thereof.
The foregoing items of business are more fully described in the Proxy
Statement that is attached to and made a part of this Notice. The Board of
Directors has fixed June 23, 2003 as the record date for determining
stockholders entitled to notice of, and to vote at, the Annual Meeting, or any
adjournment or postponement thereof.
All stockholders are cordially invited to attend the Annual Meeting in
person. Whether or not you plan to attend the Annual Meeting, your vote is
important. To assure your representation at the Annual Meeting, please sign and
date the enclosed proxy card and return it promptly in the enclosed envelope,
which requires no additional postage if mailed in the United States or Canada.
Should you receive more than one proxy card because your shares are registered
in different names and addresses, each proxy card should be signed and returned
to assure that all your shares will be voted. You may revoke your proxy at any
time prior to the Annual Meeting in the manner set forth in the Proxy Statement.
If you attend the Annual Meeting and vote by ballot, your proxy will be revoked
automatically and only your vote at the Annual Meeting will be counted.
The Proxy Statement and the accompanying proxy card are being mailed
beginning on or about June 27, 2003 to stockholders entitled to vote.
By Order of the Board of Directors
/s/ Susan Strausberg
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Susan Strausberg
Chief Executive Officer, President and Secretary
Norwalk, Connecticut
June 27, 2003
YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF
SHARES YOU OWN. PLEASE READ THE ATTACHED PROXY STATEMENT
CAREFULLY, COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD AS
PROMPTLY AS POSSIBLE AND RETURN IT IN THE ENCLOSED ENVELOPE.
EDGAR ONLINE, INC.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JULY 30, 2003
GENERAL
The enclosed proxy is solicited by the Board of Directors of EDGAR
Online, Inc., a Delaware corporation ("EDGAR Online" or "the Company"), for use
at the Annual Meeting of Stockholders of the Company to be held at 10:00 A.M.
(local time) on July 30, 2003, at the Company's offices, 50 Washington Street,
Norwalk, Connecticut 06854, and any adjournment or postponement thereof. This
Proxy Statement, the accompanying proxy card and the Company's Annual Report on
Form 10-K for the 2002 Fiscal Year are being mailed on or about June 27, 2003 to
stockholders entitled to vote at the meeting.
RECORD DATE AND VOTING SHARES
Only holders of record of the Company's common stock, par value $0.01
per share (the "Common Stock"), at the close of business on June 23, 2003 (the
"Record Date"), will be entitled to notice of and to vote at the Annual Meeting.
At the close of business on the Record Date, the Company had 16,878,698 shares
of Common Stock outstanding. No shares of the Company's preferred stock, par
value $0.01, were outstanding. Each stockholder is entitled to one vote for each
share of Common Stock held by such stockholder on the Record Date. Cumulative
voting is not permitted.
Directors are elected by a plurality of the votes, which means the
seven nominees who receive the largest number of properly executed votes will be
elected as Directors. Shares that are represented by proxies that are marked
"withhold authority" for the election of one or more Director nominees will not
be counted in determining the number of votes cast for those persons. The
affirmative vote of a majority of the shares present (in person or by proxy and
entitled to vote at the Annual Meeting) is needed to ratify the appointment of
KPMG LLP as the Company's independent auditors. Any other matters properly
considered at the Annual Meeting will be determined by a majority of the votes
cast.
VOTING OF PROXIES
If the enclosed form of Proxy is properly signed and returned, the
shares represented thereby will be voted at the Annual Meeting in accordance
with the instructions specified thereon. If the Proxy does not specify how the
shares represented thereby are to be voted, the Proxy will be voted "FOR" the
election of the Directors proposed by the Board unless the authority to vote for
the election of such Directors is withheld and, if no contrary instructions are
given, the Proxy will be voted "FOR" the approval of Proposal 2 described in
this Proxy Statement, and in accordance with the discretion of the proxy holders
as to all other matters that may properly come before the Annual Meeting. If a
broker indicates on the enclosed Proxy or its substitute that it does not have
discretionary authority as to certain shares to vote on a particular matter
("broker non-votes"), those shares will not be considered as voting with respect
to that matter. The Company believes that the tabulation procedures to be
followed by the Inspector of Elections are consistent with the general
requirements of Delaware law concerning voting of shares and determination of a
quorum.
The manner in which your shares may be voted depends on how your shares
are held. If you own shares of record, meaning that your shares of Common Stock
are represented by certificates or book entries in your name so that you appear
as a stockholder on the records of the Company's stock transfer agent, American
Stock Transfer & Trust Company, a proxy card for voting those shares will be
included with this Proxy Statement. You may vote those shares by completing,
signing and returning the proxy card in the enclosed envelope. If you own shares
in street name, meaning that your shares of Common Stock are held by a bank or
brokerage firm, you may instead receive a voting instruction form with this
Proxy Statement that you may use to instruct your bank or brokerage firm how to
vote your shares. As with a proxy card, you may vote your shares by completing,
signing and returning the voting instruction form in the envelope provided.
ATTENDANCE AND VOTING AT THE ANNUAL MEETING
If you own Common Stock of record, you may attend the Annual Meeting
and vote in person, regardless of whether you have previously voted by proxy
card. If you own Common Stock in street name, you may attend the Annual Meeting
but in order to vote your shares at the Annual Meeting you must obtain a "legal
proxy" from the bank or brokerage firm that holds your shares. You should
contact your bank or brokerage account representative to learn how to obtain a
legal proxy. We encourage you to vote your shares in advance of the Annual
Meeting, even if you plan on attending the Annual Meeting. If you have already
voted prior to the Annual Meeting, you may nevertheless change or revoke your
vote at the Annual Meeting in the manner described below.
REVOCATION
If you own Common Stock of record you may revoke a previously granted
proxy at any time before it is voted by (i) delivering to the Secretary of the
Company a written notice of revocation or a duly executed proxy bearing a later
date or by (ii) attending the Annual Meeting and voting in person. Any
stockholder owning Common Stock in street name may change or revoke previously
given voting instructions by (i) contacting the bank or brokerage firm holding
the shares or by (ii) obtaining a legal proxy from such bank or brokerage firm
and voting in person at the Annual Meeting.
TABULATION OF VOTES; QUORUM
Votes cast in person or by proxy at the Annual Meeting will be
tabulated by the Inspector of Elections appointed for the Annual Meeting and
will determine whether or not a quorum is present. The holders of a majority of
the shares of Common Stock entitled to vote at the meeting, present in person or
represented by proxy, shall constitute a quorum for the transaction of business.
SOLICITATION
The Company will bear the entire cost of solicitation, including the
preparation, assembly, printing and mailing of this Proxy Statement, the Proxy
and any additional solicitation materials furnished to the stockholders. Copies
of solicitation materials will be furnished to brokerage houses, fiduciaries and
custodians holding shares in their names that are beneficially owned by others
so that they may forward this solicitation material to such beneficial owners.
In addition, the Company may reimburse such persons for their costs in
forwarding the solicitation materials to such beneficial owners. The original
solicitation of Proxies by mail may be supplemented by a solicitation by
telephone, telegram or other means by directors, officers or employees of the
Company. No additional compensation will be paid to these individuals for any
such services. Except as described above, the Company does not presently intend
to solicit Proxies other than by mail.
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STOCKHOLDER PROPOSALS
Our bylaws establish an advance notice procedure for stockholder
proposals to be brought before an annual meeting of stockholders. In general,
stockholder proposals and director nominations intended to be presented at our
2004 Annual Meeting of Stockholders must be received by us at our corporate
headquarters between May 1, 2004 and May 31, 2004 in order to be considered at
that Meeting. This notice requirement does not apply to (i) any stockholder
holding at least twenty-five percent (25%) of our outstanding Common Stock or
(ii) any stockholder who has an agreement with us for the nomination of a person
or persons for election to the Board of Directors. A copy of the full text of
the bylaw provisions discussed above may be obtained by writing to our Secretary
at our corporate headquarters.
In addition to our bylaw provisions, stockholder proposals submitted
pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, as amended,
and intended to be presented at the 2004 Annual Meeting of Stockholders must be
received by our Secretary at our corporate headquarters no later than February
28, 2004 in order to be considered for inclusion in our proxy materials for that
Meeting.
The proxy holders will have discretionary authority to vote on any
stockholder proposal presented at the 2004 Annual Meeting of Stockholders if we
fail to receive notice of such stockholder's proposal for the meeting by May 12,
2004.
MATTERS TO BE CONSIDERED AT ANNUAL MEETING
PROPOSAL NUMBER ONE
ELECTION OF DIRECTORS
The Company's By-laws provide that the number of Directors shall be
seven or such other number as fixed by the Board of Directors. The Board
reserves the right to increase the size of the Board as provided in the
Company's By-laws.
At the Annual Meeting, the stockholders will elect seven Directors, who
have been recommended by the Nominating Committee of the Board, who will serve a
one-year term until the 2004 Annual Meeting of Stockholders or until a successor
is elected or appointed and qualified or until such Director's earlier
resignation or removal. If any nominee is unable or unwilling to serve as a
Director, proxies may be voted for a substitute nominee designated by the
present Board. The Board has no reason to believe that the persons named below
will be unable or unwilling to serve as nominees or as Directors if elected.
Proxies received will be voted "FOR" the election of all nominees unless
otherwise directed. Pursuant to applicable Delaware corporation law, assuming
the presence of a quorum, seven Directors will be elected from among those
persons duly nominated for such positions by a plurality of the votes actually
cast by stockholders entitled to vote at the Annual Meeting who are present in
person or by proxy.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE
NOMINEES NAMED BELOW
INFORMATION CONCERNING NOMINEES
Certain information about each of the seven nominees is set forth
below. Each Director has served continuously with the Company since his or her
first election as indicated below.
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DIRECTOR
NAME AGE POSITION SINCE
---- --- -------- -----
Susan Strausberg (1)(4) 64 Chief Executive Officer, President, Secretary and 1995
Director
Marc Strausberg (1) 68 Chairman of the Board and Director 1995
Stefan Chopin (2)(4) 44 Director 1996
Mark Maged(2)(3)(4) 71 Director 1999
Benjamin Burditt (2)(3) 45 Director 2003
Richard Feinstein (3) 60 Director 2003
Jonathan Bulkeley 42 Director and non-executive Vice Chairman 2003
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(1) Member of the Outside Directors Compensation Committee.
(2) Member of the Compensation Committee.
(3) Member of the Audit Committee.
(4) Member of the Nominating Committee.
SUSAN STRAUSBERG, a co-founder of EDGAR Online, has served as a member of the
Board of Directors, Chief Executive Officer and Secretary since EDGAR Online was
formed in November 1995 and as President since January 2003. From December 1994
until the formation of EDGAR Online, Ms. Strausberg was a consultant to Internet
Financial Network. Ms. Strausberg served on the Board of Directors of RKO
Pictures from December 1998 to May 2001. Ms. Strausberg, the wife of Mr.
Strausberg, EDGAR Online's Chairman, holds a B.A. degree from Sarah Lawrence
College.
MARC STRAUSBERG, a co-founder of EDGAR Online, has served as Chairman of the
Board of Directors of EDGAR Online since its formation in November 1995 and
President from inception until March 1999. Mr. Strausberg resigned as President
upon the election of Tom Vos to this position in March 1999. In December 1994,
Mr. Strausberg co-founded Internet Financial Network, an EDGAR based financial
information vendor and served as IFN's co-chairman until founding EDGAR Online.
From 1992 to 1994, Mr. Strausberg was the publisher of the Livermore Report, a
newsletter that focused on the valuation of initial public offerings. Mr.
Strausberg, the husband of Ms. Strausberg, EDGAR Online's Chief Executive
Officer, holds a B.A. degree from Muhlenberg College.
STEFAN CHOPIN joined EDGAR Online as a member of the Board of Directors in 1996.
He is currently the President of Pequot Group Inc., a technology development
company for the financial services industry. Previously, Mr. Chopin was the
Senior Vice President of Technology for iXL Enterprises, Inc., an e-business
solutions provider. Prior to joining iXL in 1998, Mr. Chopin was the founder and
President of Pequot Systems, a software development and consulting firm. In
October 1998, Pequot was acquired by iXL Enterprises, Inc. Prior to founding
Pequot Systems in November 1995, Mr. Chopin served as the Vice President of
Engineering for Micrognosis, Inc., a leading provider of trading room systems.
MARK MAGED joined EDGAR Online as a member of the Board of Directors in March
1999. Since 1992, Mr. Maged, either individually or as Chairman of MJM
Associates, LLC, has engaged in various private investment banking activities in
the United States and internationally. From September 1995 through May 2000, he
was chairman of Internet Tradeline, Inc. From 1975 through 1983, he served as
President and Chief Executive Officer of Schroder's Incorporated, which operated
banking, investment banking and investment management businesses as the United
States arm of Schroders PLC, an international merchant bank.
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BENJAMIN BURDITT joined EDGAR Online as a member of the Board of Directors in
April 2003. Mr. Burditt is currently the Senior Vice President of Scripps
Ventures, LLC, a venture capital fund with $90 million invested in over 30 early
stage companies, which he co-founded in 1996. From 1994 to 1996, Mr. Burditt was
a Senior Vice President of United Media, a division of the E.W. Scripps Company
overseeing strategy and new investments for newspaper syndication and worldwide
licensing. From 1987 to 1993, Mr. Burditt was a management consultant with
McKinsey & Company where he worked with large multinational corporations on a
wide range of issues facing senior management. Mr. Burditt serves on the Board
of Directors of several portfolio companies including Affinity Solutions,
StructuredWeb, Timeless Hospitality and VipDesk. He holds an M.B.A. degree from
Yale University and a B.A. degree in economics from Middlebury College. Mr.
Burditt is also a commercial pilot and certified flight instructor.
RICHARD L. FEINSTEIN joined EDGAR Online as a member of the Board of Directors
in April 2003. Mr. Feinstein is currently a consultant providing management and
financial advice to clients in a variety of industries. From December 1997 to
October 2002, Mr. Feinstein was a Senior Vice President and Chief Financial
Officer for The Major Automotive Companies, Inc. (Nasdaq: MAJR), formerly a
diversified holding company, but now engaged solely in retail automotive
dealership operations. From December 1994 to December 1997, Mr. Feinstein
maintained his own financial and management consulting practice. From November
1989 to December 1994, he also served as Managing Director and Chief Financial
Officer of Employee Benefit Services, Inc., a benefit communications and
financial services firm. Prior to 1989, Mr. Feinstein was a partner of the Audit
Practice and National Director of Litigation Settlement Practice at KPMG Peat
Marwick and Partner, SEC Review Department, Audit and National Director, Finance
and Administration (CFO) of Main Hurdman & Co., an accounting firm. Mr.
Feinstein, a CPA, holds a B.B.A. degree from Pace University.
JONATHAN BULKELEY joined EDGAR Online as non-executive Vice Chairman and a
member of the Board of Directors in April 2003. Since February 1998, he has
served as the non-executive Chairman of QXL ricardo plc, a leading online
auction company in Europe. From February 2001 to October 2001, Mr. Bulkeley
served as Chairman and CEO of LifeMinders Inc., an online direct marketing firm
and served as a director of that company from August 1999 until October 2001.
From January 1999 to January 2000, Mr. Bulkeley served as Chief Executive
Officer of barnesandnoble.com. From March 1993 to December 1998, he was
affiliated with America Online, including serving as Managing Director of the
online services joint venture of AOL - U.K. and Bertelsmann Online and President
of AOL - U.K. Mr. Bulkeley serves on the Board of Directors of Milliken & Co.
and The Readers Digest Association as well as on the Advisory Boards of The
Jordan Edminston Venture Fund, Elderstreet Capital Partners and Jerusalem Global
Venture Partners. He has a B.A. degree from Yale University.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held seven meetings and took two actions by
written consent during the fiscal year ended December 31, 2002 (the "2002 Fiscal
Year"). The Board has an Audit Committee, a Compensation Committee, an Outside
Directors Compensation Committee and a Nominating Committee. Each Director
attended or participated in 75% or more of the aggregate of (i) the total number
of meetings of the Board and (ii) the total number of meetings held by all
committees of the Board on which such Director served during the 2002 Fiscal
Year.
The Audit Committee reviews, acts on and reports to the Board of
Directors with respect to various auditing and accounting matters, including the
selection of our independent auditors, the scope of the annual audits, fees to
be paid to the auditors, the performance of our independent auditors and our
accounting practices. The members of the Audit Committee are Messrs. Maged,
5
Burditt and Feinstein, each non-employee directors of the Company. The Audit
Committee held one meeting during the 2002 Fiscal Year.
The Compensation Committee reviews and approves the compensation and
benefits of our key executive officers, administers our employee benefit plans
and makes recommendations to the Board regarding such matters. The members of
the Compensation Committee are Messrs. Chopin, Maged and Burditt. The
Compensation Committee held one meeting during the 2002 Fiscal Year.
The Board has also established the Outside Directors Compensation
Committee and appointed Marc Strausberg and Susan Strausberg to be its members.
The Outside Directors Compensation Committee has the responsibility to
administer our 1999 Outside Directors Stock Option Plan. The Outside Directors
Compensation Committee held one meeting during the 2002 Fiscal Year.
The Board established a Nominating Committee in April 2003 that reviews
and assesses the composition of the Board, assists in identifying potential new
candidates for Director and nominates candidates for election to the Board of
Directors. The Nominating Committee consists of Messrs. Chopin and Maged and Ms.
Strausberg.
DIRECTOR COMPENSATION
Directors are currently eligible to receive stock options every three
years under any one of our three stock option plans: the 1996 Stock Option Plan,
the 1999 Stock Option Plan and the 1999 Outside Directors' Stock Option Plan. In
March 1999, each of our non-employee directors was granted options to purchase
10,000 shares of Common Stock at an exercise price of $4.50 per share under the
1996 Stock Option Plan. In August 2000, each of our non-employee directors was
granted options to purchase 7,500 shares of Common Stock at an exercise price of
$3.50 per share under the 1999 Stock Option Plan. In August 2002, each of our
non-employee directors were granted options to purchase 10,000 shares of our
Common Stock at a price of $1.75 per share under our 1999 Outside Directors
Stock Option Plan. In November 2002, a Mergers and Acquisition Committee was
formed consisting of Bruce Bezpa, Stefan Chopin and Mark Maged, our then current
outside directors to explore a proposed transaction. Each member of the
committee was paid $7,500 in 2002 and $7,500 in 2003. The transaction was not
consummated, and no further payments are due to the members of this committee,
which has since been terminated. In January 2003, Douglas McIntyre, a former
outside director, was granted options to purchase 15,000 shares of Common Stock
at an exercise price of $1.42 per share under our 1999 Outside Directors Stock
Option Plan. These options were cancelled when Mr. McIntyre resigned from the
Board in April 2003. In April 2003, Messrs. Burditt and Feinstein were each
granted options to purchase 15,000 shares at an exercise price of $0.86 per
share under our 1999 Outside Directors Stock Option Plan. Also in April 2003,
Jonathan Bulkeley was granted options to purchase 75,000 shares of our Common
Stock at a price of $0.86 under our 1999 Stock Option Plan. In addition, Mr.
Bulkeley is paid an annual salary of $60,000 to serve as non-executive Vice
Chairman of the Board of Directors.
AUDIT COMMITTEE REPORT
On June 12, 2000, the Board adopted a charter for the Audit Committee.
Pursuant to the charter, the Audit Committee makes recommendations as to the
engagement and fees of the independent auditors, reviews the preparations for
and the scope of the audit of EDGAR Online's annual financial statements,
reviews drafts of such statements and monitors the functioning of EDGAR Online's
accounting and internal control systems by meeting with representatives of
management, the independent auditors and the internal auditors.
On March 26, 2003, the Audit Committee (then consisting of Bruce Bezpa,
Mark Maged and Douglas McIntyre) met to review the results of the 2002 Fiscal
Year audit. During this meeting, the Audit Committee discussed the matters
required to be disclosed by Statement on Auditing Standards
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No. 1 with KPMG LLP, our independent public accountants ("KPMG"). KPMG delivered
the written disclosures and letter required by Independence Standards Board
Standard No. 1. This Standard requires auditors to communicate, in writing, at
least annually, all relationships between the auditors and the Company that, in
the auditor's professional judgment, may reasonably be thought to affect the
auditor's independence. The Audit Committee has received this disclosure and
discussed with KPMG its independence from the Company. In addition, the Audit
Committee discussed the audited financial statements for 2002 and the results of
the audit with the Company's management. Based upon its meetings with KPMG and
its review of the audited financial statements, the Audit Committee recommended
to the Board that the audited financial statements be included in the Company's
Annual Report on Form 10-K for the year ended December 31, 2002, which was filed
with the Securities and Exchange Commission on March 31, 2003.
The Audit Committee plans to meet with KPMG during the current fiscal
year and in early 2004 to review the scope of the 2003 audit and other matters.
Submitted by the Audit Committee:
Richard Feinstein, Chairman
Mark Maged
Benjamin Burditt
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No interlocking relationships exist between any members of the Board or
the Compensation Committee of the Company and the board of directors or
compensation committee of any other company, nor has any such interlocking
relationship existed in the past. The Company had business and financial
relationships with iXL Enterprises, Inc. Stefan Chopin was a Vice President of
iXL Enterprises, Inc., formerly known as Pequot Systems. Our relationship with
iXL is described below.
Pequot Systems (iXL)
From our inception through February 2001, we outsourced our technology
development to Pequot. During 1995, in partial payment for services rendered,
Pequot received warrants to purchase shares of Common Stock at an exercise price
of $.05 per share. The warrants were exercised in May 1997. In March 1998,
Pequot agreed to accept shares of our Common Stock valued at $1.25 per share in
partial payment for services rendered. As a result of these two transactions,
Pequot received 359,384 shares of Common Stock. In 2002, 2001 and 2000, we paid
Pequot a total of $0, $164,216 and $2,725,770, respectively, for services
provided. As a result of the acquisition of Pequot by iXL, an unrelated company,
in 1998, the shares owned by Pequot were transferred to Pequot's founders,
including Stefan Chopin, the founder and President of Pequot. Mr. Chopin has
been a member of our Board of Directors since 1996 and currently serves as a
member of our Compensation Committee and Nominating Committee. We believe that
the terms of our agreements with Pequot have been beneficial to EDGAR Online and
no less favorable to EDGAR Online than terms which might be available to us from
unaffiliated third parties.
INFORMATION CONCERNING EXECUTIVE OFFICERS
The executive officers of the Company as of the date of this Proxy
Statement, other than Susan Strausberg and Marc Strausberg, are identified
below. Each executive officer is elected annually by the Board and serves at the
pleasure of the Board.
7
NAME AGE POSITION
---- --- --------
Greg D. Adams 42 Chief Operating Officer and Chief Financial Officer
Jay Sears 36 Senior Vice President of Business Strategy and Development
Paul Sappington 40 Chief Software Officer and Vice President
GREG D. ADAMS joined EDGAR Online as Chief Financial Officer in March 1999 and
became Chief Operating Officer in January 2003. Mr. Adams is a Certified Public
Accountant with diversified business experience in both the public and private
sectors. Prior to joining EDGAR Online, Mr. Adams served as Senior Vice
President Finance and Administration of PRT Group Inc., a technology solutions
and services company. From 1994 to 1996, Mr. Adams was the Chief Financial
Officer of the Blenheim Group Inc., a publicly held UK information technology
exposition and conference management company. Prior to that, Mr. Adams worked
for 11 years as an accountant with KPMG Peat Marwick. He is a member of the New
York State Society of Certified Public Accountants and the American Institute of
Certified Public Accountants. Mr. Adams holds a B.B.A. degree in Accounting from
the College of William & Mary.
JAY SEARS joined EDGAR Online as Vice President of Marketing and Business
Development in May 1997. He is currently Senior Vice President of Business
Strategy and Development for EDGAR Online. From September 1995 to April 1997,
Mr. Sears was Vice President of Marketing for Wolff Media, a publisher of
Internet and printed guides to the Internet. From July 1991 to August 1995, Mr.
Sears was a Senior Account Supervisor at Creamer Dickson Basford, an
international marketing, communications and public relations firm. Mr. Sears
holds a B.A. degree from Kenyon College.
PAUL SAPPINGTON joined EDGAR Online as Vice President following EDGAR Online's
acquisition of Financial Insight Systems, Inc. in October 2000 and was named
Chief Software Officer of EDGAR Online in August 2001. Mr. Sappington joined FIS
in 1999 and served as Senior Project Manager from 1999 until October 2000. Mr.
Sappington also served as Project Manager (1997-1999), Manager of Software
Development (1992-1997) and Senior Software Engineer (1987-1992) of the Research
division of Thomson Financial (formally CDA Investment Technologies Inc.), a
provider of computer related financial services to the institutional community.
Mr. Sappington holds a B.S. degree from Bridgewater College.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
Executive Compensation
The following table sets forth the total compensation paid or accrued
for the fiscal years ended December 31, 2002, 2001 and 2000 by our Chief
Executive Officer and our five most highly compensated executive officers (other
than our Chief Executive Officer) (collectively, the "Named Executive
Officers").
8
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION SECURITIES
------------------- UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OTHER (3) OPTIONS (#)
--------------------------- ---- ------ ----- --------- -----------
Susan Strausberg 2002 $ 152,923 --- --- 14,000
Chief Executive Officer and President 2001 $ 149,654 --- --- 47,500
2000 $ 150,000 $ 20,000 --- 35,000
Marc Strausberg 2002 $ 146,885 --- --- 14,000
Chairman 2001 $ 149,654 --- --- 47,500
2000 $ 150,000 $ 20,000 --- 35,000
Tom Vos(l) 2002 $ 149,904 --- --- 14,000
Former President and Chief 2001 $ 149,173 --- --- 47,500
Operating Officer 2000 $ 125,000 $ 20,000 --- 70,000
Greg Adams 2002 $ 149,904 --- $ 43,049 14,000
Chief Operating Officer and Chief 2001 $ 149,173 --- $ 8,100 47,500
Financial Officer 2000 $ 125,000 $ 20,000 $ 8,100 70,000
Jay Sears 2002 $ 138,538 --- $ 6,000 12,500
Senior Vice President 2001 $ 137,923 --- $ 5,579 15,000
of Business Strategy and Development 2000 $ 125,000 $ 20,000 $ 5,100 65,000
Paul Sappington (2) 2002 $ 138,907 --- --- 62,500
Chief Software Officer and 2001 $ 136,098 --- --- 36,000
Vice President 2000 $ 23,366 $ 5,000 --- ---
- --------------
(1) Effective January 27, 2003, Ms. Strausberg assumed the responsibilities of
President and Mr. Adams assumed the responsibilities of Chief Operating
Officer.
(2) Mr. Sappington joined EDGAR Online as Chief Software Officer and Vice
President on October 30, 2000 at a salary of $140,000 per annum.
(3) Other compensation includes commutation allowances and a commission paid to
Mr. Adams for certain sales.
Option Grants In Last Fiscal Year
The following table sets forth certain information regarding stock
options granted to the Named Executive Officers during the 2002 Fiscal Year. We
have never granted any stock appreciation rights.
POTENTIAL
INDIVIDUAL GRANTS (1) REALIZABLE VALUE
NUMBER OF PERCENT OF AT ASSUMED ANNUAL
SECURITIES TOTAL OPTIONS RATES OF STOCK
UNDERLYING GRANTED TO EXERCISE PRICE
OPTIONS EMPLOYEES IN PRICE PER EXPIRATION APPRECIATION FOR
NAME GRANTED 2002(2) SHARE ($) DATE OPTION TERM (3)
5% 10%
Susan 14,000 3.30% $3.60 January 28, 2007 --(4) --(4)
Strausberg
Marc 14,000 3.30% $3.60 January 28, 2007 --(4) --(4)
Strausberg
9
Tom Vos 14,000 3.30% $3.27 January 28, 2012 --(4) $18,493
Greg 14,000 3.30% $3.27 January 28, 2012 --(4) $18,493
Adams
Jay Sears 12,500 2.95% $3.27 January 28, 2012 --(4) $16,512
Paul 12,500 2.95% $3.27 January 28, 2012 --(4) $16,512
Sappington 50,000 11.80% $3.25 April 5, 2012 --(4) $67,046
(1) Each option represents the right to purchase one share of Common
Stock. The options shown in this table were all granted under our
1996 and 1999 Stock Option Plans, as amended.
(2) In the 2002 Fiscal Year, we granted options to employees to
purchase an aggregate of 423,775 shares of Common Stock.
(3) Amounts represent hypothetical gains that could be achieved for the
respective options if exercised at the end of the option term. The
5% and 10% assumed annual rates of compounded stock price
appreciation are mandated by the rules of the SEC and do not
represent our estimate or projection of future Common Stock price
growth. These amounts represent certain assumed rates of
appreciation in the value of our Common Stock from the fair market
value on the date of grant. Actual gains, if any, on stock option
exercises are dependent on the future performance of the Common
Stock and overall stock market conditions. The amounts reflected in
the table may not necessarily be achieved.
(4) Value less than zero ($0).
Aggregated Option Exercises In Last Fiscal Year And Fiscal Year-End Option
Values
The following table sets forth information concerning the exercise of
stock options during the 2002 Fiscal Year by each of the Named Executive
Officers and the fiscal year-end value of unexercised options. No options were
exercised by any of the Named Executive Officers during this period.
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
DECEMBER 31, 2002 DECEMBER 31, 2002(1)
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ----------- -------------
Susan Strausberg 42,916 53,584 $ 6,300 $6,300
Marc Strausberg 42,916 53,584 $ 6,300 $6,300
Tom Vos 362,918 68,583 $ 311,538 $7,538
Greg Adams 194,955 61,546 $ 7,538 $7,538
Jay Sears 138,334 44,166 $ 98,800 --
Paul Sappington 15,500 83,000 $ 7,035 $7,035
(1) The fair market value of the Common Stock as of December 31, 2002 was $1.77.
10
Employment Agreements
We entered into a five-year amended and restated employment agreement
dated as of May 6, 1999 with Susan Strausberg. The agreement extends
automatically for an additional year at the end of the initial term and each
anniversary thereafter unless 30-day prior notice of termination is provided by
either Ms. Strausberg or EDGAR Online. The agreement provides for a minimum
annual salary of $150,000, and an annual bonus at the discretion of the Board.
In the event there is a change of control (as defined in the agreement) and Ms.
Strausberg's employment is terminated (either by her or EDGAR Online) within one
year thereafter, Ms. Strausberg will receive a severance benefit equal to the
product of 2.99 times the sum of (1) her then applicable annual base salary and
(2) the average of her last two annual cash bonuses. Additionally, the agreement
contains non-compete and non-solicitation provisions effective during the term
of her employment and for one year thereafter. In consideration of Ms.
Strausberg assuming the additional responsibilities of President, the Company
and Ms. Strausberg executed an amendment to her employment agreement dated March
17, 2003. Pursuant to such amendment, Ms. Strausberg's annual compensation was
increased to $220,000 per annum and Ms. Strausberg was provided with a
commutation allowance equal to $1,750 per month.
We entered into a five-year amended and restated employment agreement
dated as of May 6, 1999 with Marc Strausberg. The agreement extends
automatically for an additional year at the end of the initial term and each
anniversary thereafter unless 30-day prior notice of termination is provided by
either Mr. Strausberg or EDGAR Online. The agreement provides for a minimum
annual salary of $150,000, and an annual bonus at the discretion of the Board.
In the event there is a change of control (as defined in the agreement) and Mr.
Strausberg's employment is terminated (either by him or EDGAR Online) within one
year thereafter, Mr. Strausberg will receive a severance benefit equal to the
product of 2.99 times the sum of (1) his then applicable annual base salary and
(2) the average of his last two annual cash bonuses. Additionally, the agreement
contains non-compete and non-solicitation provisions effective during the term
of his employment and for one year thereafter. The Company and Mr. Strausberg
executed an amendment to his employment agreement dated March 17, 2003. Pursuant
to such amendment, Mr. Strausberg's annual compensation was decreased to
$100,000 per annum and Mr. Strausberg was provided with a commutation allowance
equal to $1,750 per month.
We entered into a five-year amended and restated employment agreement
dated June 29, 2001 with Tom Vos to serve as President and Chief Operating
Officer. In March 2003, the Company and Mr. Vos entered into a Separation and
Release Agreement (the "Separation Agreement") pursuant to which Mr. Vos'
employment terminated with the Company as of February 24, 2003. Pursuant to the
Separation Agreement, the Company has agreed to pay Mr. Vos the following
payments (i) $250,000 on or before April 16, 2003, (ii) $50,000 on or before
January 15, 2004, (iii) $210,000 in 21 consecutive monthly installments of
$10,000 commencing on or before April 16, 2003 and (iv) $42,000 in six (or
fifteen at Mr. Vos' election) equal installments consistent with the Company's
group payroll dates commencing January 2005. All of the foregoing payments are
immediately due and payable upon a change of control (as defined in the
employment agreement with Mr. Vos) of the Company or upon death. Mr. Vos shall
also have the right on or after June 30, 2004 to demand payment in full of
payments then remaining due to him under the Separation Agreement, in which
event all other benefits due Mr. Vos shall terminate. The Company is also
obligated to make scheduled payments in 2003, 2004 and 2005 to the Deferred
Compensation Plan established for the benefit of Mr. Vos pursuant to the June
29, 2001 employment agreement. All stock options issued to Mr. Vos are fully
vested as of April 25, 2003 and are exercisable through June 30, 2005. Pursuant
to the Separation Agreement, Mr. Vos agreed (i) to make himself available as a
consultant on an as-needed basis at the request of the Company from April 25,
2003 through June 30, 2005 for no additional consideration and (ii) to
non-compete and non-solicitation provisions which are effective through March
31, 2004.
11
We entered into a three-year amended and restated employment agreement
dated February 1, 2002 with Greg Adams to serve as Chief Financial Officer. The
agreement extends automatically for an additional year at the end of the initial
term and each anniversary thereafter unless 30-day prior notice of termination
is provided by either Mr. Adams or EDGAR Online. The agreement provides Mr.
Adams with a minimum annual salary of $150,000, and an annual bonus at the
discretion of the Board. In the event there is a change of control (as defined
in the agreement) and Mr. Adams's employment is terminated (either by him or
EDGAR Online) within one year thereafter, Mr. Adams will receive a severance
benefit equal to the product of 2.99 times the sum of (1) his then applicable
annual base salary and (2) the average of his last two annual cash bonuses.
Additionally, the agreement contains non-compete and non-solicitation provisions
effective during the term of his employment and for one year thereafter. In
consideration of Mr. Adams assuming the additional responsibilities of Chief
Operating Officer, the Company and Mr. Adams executed an amendment to his
employment agreement dated February 17, 2003. Pursuant to such amendment, Mr.
Adams' annual compensation was increased to $195,000 per annum.
We entered into a three-year amended and restated employment agreement
dated April 13, 2001 with Jay Sears. The agreement provides Mr. Sears with a
minimum annual salary of $135,000 and an annual bonus at the discretion of the
Board of Directors. If Mr. Sears' employment is terminated without cause, or in
the event of a change of control (as defined in the agreement), we will pay him
eighteen months of his total annual compensation. Additionally, the agreement
contains non-compete and non-solicitation provisions effective during the term
of his employment and for six months thereafter in the case of the non-compete
provision and one year thereafter in the case of the non-solicitation provision.
We entered into a three-year amended and restated employment agreement
dated August 1, 2001 with Paul Sappington. The agreement provides Mr. Sappington
with a minimum annual salary of $140,000 and an annual bonus at the discretion
of the Board. If Mr. Sappington's employment is terminated without cause, or in
the event of a change of control (as defined in the agreement), we will pay him
a severance benefit equal to the product of 1.5 times his annual salary plus the
average of his last two annual cash bonuses. Additionally, the agreement
contains non-compete and non-solicitation provisions effective during the term
of his employment and for one year thereafter in the case of the non-compete
provision and one year thereafter in the case of the non-solicitation provision.
Compensation Committee Report On Executive Compensation
Scope of the Committee's Work
The Compensation Committee of the Board of Directors reviews and
approves the Company's executive compensation philosophy and policies and
applies those policies to the compensation of executive officers. The current
members of the Compensation Committee are Messrs. Chopin, Maged and Burditt,
each of whom is an independent outside director. The Compensation Committee
believes that the compensation programs for the Company's executive officers
should reflect the Company's performance and the value created for the Company's
stockholders. In addition, the Compensation Committee believes that the
compensation programs should support the short-term and long-term strategic
goals and values of the Company and should reward individual contribution to the
Company's success. The Compensation Committee ensures that the executive
compensation policies and plans provide the necessary total remuneration program
to properly align the Company's performance with the interests of the Company's
stockholders through the use of competitive and equitable executive compensation
in a balanced and reasonable manner, for both the short and long-term.
12
Executive Compensation Philosophy and Policies
EDGAR Online's overall compensation philosophy is to provide a total
compensation package that is competitive and enables EDGAR Online to attract,
motivate, reward and retain key executives and other employees who have the
skills and experience necessary to promote the short and long-term financial
performance and growth of the company.
The Compensation Committee recognizes the critical role of its
executive officers in the significant growth and success of the Company to date
and its future prospects. Accordingly, EDGAR Online's executive compensation
policies are designed to (1) align the interests of executive officers and
stockholders by encouraging stock ownership by executive officers and by making
a significant portion of executive compensation dependent upon the Company's
financial performance; (2) provide compensation that will attract and retain
talented professionals; (3) reward individual results through base salary,
annual cash bonuses, long-term incentive compensation in the form of stock
options and various other benefits; and (4) manage compensation based on skill,
knowledge, effort and responsibility needed to perform a particular job
successfully.
In its recommendations on salary, bonuses and long-term incentive
compensation for its executive officers, the Compensation Committee takes into
account both the position and expertise of a particular executive, as well as
the Committee's understanding of the competitive compensation for similarly
situated executives in the Company's industry.
Executive Compensation
Base Salary. Salaries for executive officers for 2002 were generally
determined on an individual basis by evaluating each executive's scope of
responsibility, performance, prior experience and salary history, as well as the
salaries for similar positions at comparable companies.
Bonus. The amount of cash bonuses paid to executives is partially based
upon the financial results of EDGAR Online, personal and team objectives and the
recommendations of the Compensation Committee. No bonuses were paid to Named
Executives of the Company in 2002.
Long-Term Incentive Awards
The Compensation Committee believes that equity-based compensation in
the form of stock options links the interests of executives with the long-term
interests of EDGAR Online's stockholders and encourages executives to remain in
EDGAR Online's employ. The Company grants stock options in accordance with its
various stock option plans. Grants are awarded based on a number of factors,
including the individual's level of responsibility, the amount and term of
options already held by the individual, the individual's contributions to the
achievement of EDGAR Online's financial and strategic objectives and industry
practices and norms.
Compensation of the Chief Executive Officer
In May 1999, the Company entered into an Employment Agreement with Ms.
Strausberg pursuant to which she serves as Chief Executive Officer of the
Company and was paid a base salary of $152,923 for the 2002 Fiscal Year and no
bonus. In consideration of Ms. Strausberg assuming the additional
responsibilities of President, the Company and Ms. Strausberg executed an
amendment to her employment agreement dated March 17, 2003. Ms. Strausberg's
salary and other compensation and the terms of her employment agreement have
been established by reference to the salaries and equity participations of other
chief executive officers of companies in EDGAR Online's industry and in
recognition of Ms. Strausberg's unique skills and importance to EDGAR Online.
13
Internal Revenue Code Section 162(m) Limitation
Section 162(m) of the Internal Revenue Code, enacted in 1993, generally
disallows a tax deduction to publicly held companies for compensation exceeding
$1 million paid to certain of the Company's executive officers. The limitation
applies only to compensation that is not considered to be performance-based. The
non-performance based compensation paid to EDGAR Online's executive officers in
2002 did not exceed the $1 million limit per officer. EDGAR Online's Stock
Option Plans are structured so that any compensation deemed paid to an executive
officer in connection with the exercise of option grants made under that plan
will qualify as performance-based compensation which will not be subject to the
$1 million limitation. The Compensation Committee currently intends to limit the
dollar amount of all other compensation payable to the Company's executive
officers to no more than $1 million. The Compensation Committee is aware of the
limitations imposed by Section 162(m), and the exemptions available therefrom,
and will address the issue of deductibility when and if circumstances warrant.
Submitted by the Compensation Committee:
Stefan Chopin, Chairman
Mark Maged
Benjamin Burditt
PROPOSAL NUMBER TWO
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
Our Audit Committee has appointed the firm of KPMG LLP, independent
public accountants for the Company during the 2002 Fiscal Year, to serve in the
same capacity for the year ending December 31, 2003, and is asking the
stockholders to ratify this appointment. The affirmative vote of a majority of
the shares of Common Stock represented and voting at the Annual Meeting is
required to ratify the selection of KPMG LLP.
In the event the stockholders fail to ratify the appointment, our Audit
Committee and Board of Directors will reconsider whether or not to retain that
firm. Even if the selection is ratified, our Audit Committee and Board of
Directors in their discretion may direct the appointment of a different
independent accounting firm at any time during the year if they determine that
such a change would be in the best interests of the Company and our
stockholders.
A representative of KPMG LLP is expected to be present at the Annual
Meeting, will have the opportunity to make a statement if he or she desires to
do so, and will be available to respond to appropriate questions.
FEES BILLED FOR SERVICES RENDERED BY INDEPENDENT PUBLIC ACCOUNTANTS DURING THE
2002 FISCAL YEAR
For the 2002 Fiscal Year, KPMG LLP, our independent accountant, billed
the approximate fees set forth below.
14
Audit Fees
The aggregate fees billed by KPMG LLP for professional services
rendered in connection with the audit of the Company's consolidated financial
statements as of and for the 2002 Fiscal Year and for the reviews of the
financial statements included in the Company's Quarterly Reports on Form 10-Q
for that fiscal year were $180,858.
Financial Information Systems Design and Implementation Fees
The Company did not incur any fees billed by KPMG for professional
services rendered for information technology services relating to financial
information systems design and implementation for the 2002 Fiscal Year.
All Other Fees
The aggregate fees billed by KPMG for services rendered to the Company,
other than the services described above under "Audit Fees" and "Financial
Information Systems Design and Implementation Fees," for the 2002 Fiscal Year
were $172,461. These fees were for non-audit services consisting primarily of
tax services and services rendered in connection with potential transaction
matters.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE SELECTION
OF KPMG LLP TO SERVE AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS FOR THE
FISCAL YEAR ENDING DECEMBER 31, 2003.
OTHER MATTERS
The Company knows of no other matters that will be presented for
consideration at the Annual Meeting. If any other matters properly come before
the Annual Meeting, it is the intention of the persons named in the enclosed
form of Proxy to vote the shares they represent as the Board of Directors may
recommend. Discretionary authority with respect to such other matters is granted
by the execution of the enclosed Proxy.
INFORMATION REGARDING BENEFICIAL OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND
MANAGEMENT
The following table sets forth certain information known to the Company
with respect to the beneficial ownership of the Common Stock as of the Record
Date by (i) all persons who are beneficial owners of five percent (5%) or more
of the Common Stock, (ii) each director and nominee for director, (iii) the
executive officers named in the Summary Compensation Table of the Executive
Compensation section of this Proxy Statement and (iv) all directors and
executive officers as a group. Unless otherwise indicated, each of the
stockholders has sole voting and investment power with respect to the shares
beneficially owned, subject to community property laws, where applicable. Unless
otherwise indicated, the address for those listed below is c/o EDGAR Online,
Inc., 50 Washington Street, Norwalk, Connecticut 06854.
15
SHARES BENEFICIALLY OWNED
NUMBER OF
NAME OF BENEFICIAL OWNER SHARES (1) PERCENT
Executive Officers and Directors:
Susan Strausberg (2).................. 2,913,294 17.12%
Marc Strausberg (3)................... 2,913,294 17.12%
Tom Vos (4)........................... 373,490 2.17%
Greg Adams (5)........................ 293,299 1.71%
Jay Sears (6)......................... 159,167 *
Paul Sappington (7)................... 79,167 *
Jonathan Bulkeley..................... 20,000 *
Benjamin Burditt...................... - *
Richard Feinstein .................... - *
Stefan Chopin (8)(9).................. 315,217 1.87%
35 Godfrey Road
Weston, CT 06883
Mark Maged(9)......................... 45,143 *
Rue Kwadeplas, 55
1640 Rhode Saint Genese
Belgium
All executive officers and directors
as a group (11 persons)............ 4,198,777 23.51%
Other 5% Stockholders:
Albert Girod (10)..................... 1,647,090 9.76%
11105 South Glen Road
Potomac, MD 02085
Bowne & Co., Inc...................... 1,000,000 5.92%
345 Hudson Street
New York, NY 10014
Par Investment Partners, L.P (11)..... 852,930 5.05%
One Financial Center,
Suite 1600
Boston, MA 02111
Austin W. Marxe/David 2,938,404 17.15%
Greenhouse (12).......................
153 East 53rd Street
New York, NY 10021
- -----------
* Less than 1%.
16
(1) Shares of Common Stock subject to options currently exercisable or
exercisable within 60 days of the Record Date are deemed outstanding for the
purpose of computing the percentage ownership of the person holding such options
but are not deemed outstanding for computing the percentage ownership of any
other person. Unless otherwise indicated below, the persons and entities named
in this table have sole voting and sole investment power with respect to all
shares beneficially owned, subject to community property laws where applicable.
(2) Includes 176,500 shares owned by Ms. Strausberg's husband, Marc Strausberg,
EDGAR Online's Chairman of the Board and 2,550,426 shares owned by TheBean LLC
as well as 67,584 shares issuable upon exercise of options exercisable within 60
days of the Record Date and 67,584 shares issuable upon exercise of options
exercisable within 60 days of the Record Date owned by Ms. Strausberg's husband,
Marc Strausberg. Ms. Strausberg is a managing member of TheBean LLC and as such
she may be deemed to be the beneficial owner of all the shares held by TheBean
LLC. Ms. Strausberg disclaims beneficial ownership of the shares owned by her
husband.
(3) Includes 51,200 shares owned by Mr. Strausberg's wife, Susan Strausberg,
EDGAR Online's Chief Executive Officer and 2,550,426 shares owned by TheBean LLC
as well as 67,584 shares issuable upon exercise of options exercisable within 60
days of the Record Date and 67,584 shares issuable upon exercise of options
exercisable within 60 days of the Record Date owned by Mr. Strausberg's wife,
Susan Strausberg. Mr. Strausberg is a managing member of TheBean LLC and as such
he may be deemed to be the beneficial owner of all the shares held by TheBean
LLC. Mr. Strausberg disclaims beneficial ownership of the shares owned by his
wife.
(4) Includes 362,584 shares issuable upon exercise of options exercisable within
60 days of the Record Date.
(5) Includes 227,584 shares issuable upon exercise of options exercisable within
60 days of the Record Date.
(6) Includes 169,167 shares issuable upon exercise of options exercisable within
60 days of the Record Date.
(7) Includes 49,667 shares issuable upon exercise of options exercisable within
60 days of the Record Date.
(8) Includes shares owned jointly with Barbara Chopin, his wife.
(9) Includes 22,500 shares issuable upon exercise of options exercisable within
60 days of the Record Date.
(10) Reflects amount derived from this person's Form 4 as filed with the SEC on
March 5, 2003.
(11) Reflects amount derived from this entity's Schedule 13G as filed with the
SEC on February 14, 2003.
(12) Consists of the following as reported in such persons' Amendment No. 1 to
Schedule 13G as filed with the SEC on February 14, 2003: 1,561,671 shares of
Common Stock and 150,000 shares of Common Stock issuable upon exercise of
warrants exercisable within 60 days of March 20, 2003 owned by Special
Situations Fund III, L.P., 1,045,933 shares of Common Stock, and 100,000 shares
of Common Stock issuable upon exercise of warrants exercisable within 60 days of
March 20, 2003 owned by Special Situations Private Equity Fund, L.P. and 80,800
shares of Common Stock owned by Special Situations Cayman Fund L.P. AWM
Investment Company, Inc. is the general partner and investment adviser to the
Special Situations Cayman Fund L.P. and is the general partner of MGP Advisers
Limited Partnership, the general partner of Special Situations Fund III, L.P. MG
Advisors, L.L.C. is the general partner of and investment advisor to Special
Situations Private Equity Fund, L.P. Austin W. Marx and David M. Greenhouse are
the principal owners of AWM Investment Company, Inc., MGP Advisers Limited
Partnership and MG Advisors, L.L.C.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Employee Loans
In January 2001, we loaned the sum of $400,000 to certain executives,
employees and outside directors of the Company for the purpose of purchasing
shares of our Common Stock from TheBean
17
LLC, an entity in which Susan Strausberg, our Chief Executive Officer and Marc
Strausberg, our Chairman of the Board are beneficial owners. The Common Stock
was purchased at a price of $1.75 per share, the closing Nasdaq market price on
the date of sale. The loan was evidenced by separate loan and pledge agreements
with, and three-year promissory notes of, each of the borrowers. The promissory
notes are full recourse and are secured by the Common Stock purchased with the
proceeds of the individual loans. The executive officers and outside directors
participating in this transaction were Tom Vos ($175,000 Note and 100,000
shares), Greg Adams ($115,001 Note and 65,715 shares), Bruce Bezpa ($10,001 Note
and 5,715 shares) and Mark Maged ($30,000 Note and 17,143 shares). The shares of
Common Stock described in this paragraph were registered for resale pursuant to
a Registration Statement on Form S-3 that was declared effective in February,
2002. Mr. Vos fully satisfied his outstanding loan in June 2003 by tendering
129,094 shares of Common Stock to the Company.
Pequot Systems (iXL)
For information regarding our relationship with iXL, see "Compensation
Committee Interlocks and Insider Participation."
Susan Strausberg and Marc Strausberg
From time to time, we have received cash loans from and have made cash
advances to Susan Strausberg and Marc Strausberg, our founders. In December
2000, we advanced the Strausbergs $250,000 which was subsequently repaid in
January 2001. In July 2001, we advanced the Strausbergs $200,000 which was
subsequently repaid in September 2001.
STOCK PERFORMANCE GRAPH
The following graph compares, for the periods indicated below, a
comparison of cumulative total stockholder returns for the Company, the Russell
2001 Index and a composite of the following peer group companies: Hoovers, Inc.,
MarketWatch, Inc., Multex Inc. and TheStreet.com, Inc.
[CUMULATIVE TOTAL RETURN GRAPH]
18
Cumulative Total Return
---------------------------------------------------------
5/26/99 12/31/99 12/31/00 12/31/01 12/31/02
EDGAR ONLINE, INC. 100.00 77.63 16.78 32.63 18.63
RUSSELL 2000 100.00 116.87 113.34 116.16 92.37
PEER GROUP 100.00 67.18 7.65 5.29 9.36
Notes:
(1) The graph covers the period commencing May 26, 1999, the effective date of
the Company's initial public offering of shares of its Common Stock, to December
31, 2002.
(2) The graph assumes that $100 was invested in Common Stock of the Company on
May 26, 1999, and in each index or composite, and that all dividends were
reinvested. No cash dividends have been declared on the Company's Common Stock.
(3) Stockholder returns over the indicated period should not be considered
indicative of future stockholder returns.
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings made under the Securities Act of 1933, as amended, or
the Securities Exchange Act of 1934, as amended, that might incorporate future
filings made by the Company under those statutes, the preceding Stock
Performance Graph is not to be incorporated by reference into any such prior
filings, nor shall such graph be incorporated by reference into any future
filings made by the Company under those statutes.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act generally requires the Company's
executive officers and directors, and persons who own more than ten percent of
the Company's Common Stock, to file reports of beneficial ownership and changes
in beneficial ownership with the SEC. The Company became subject to the
requirements of Section 16(a) on May 26, 1999. Regulations promulgated by the
SEC require the Company to disclose in this Proxy Statement and the Company's
Form 10-K any reporting violations with respect to the 2002 Fiscal Year which
came to the Company's attention based on a review of the applicable filings
required by the SEC to report the status of an officer or director, or such
changes in beneficial ownership as submitted to the Company. Based solely on
review of such forms received by the Company, we believe that all required
reports for the 2002 Fiscal Year have been timely filed.
FORM 10-K
The Company filed an Annual Report on Form 10-K with the Securities and
Exchange Commission on March 31, 2003. A copy of this report is included with
these materials.
By Order of the Board of Directors
/s/ Susan Strausberg
------------------------------------------------
Susan Strausberg
Chief Executive Officer, President and Secretary
Dated: June 27, 2003
19
EDGAR ONLINE, INC.
PROXY
Annual Meeting of Stockholders, July 30, 2003
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
EDGAR ONLINE, INC.
The undersigned revokes all previous proxies, acknowledges receipt of the
Notice of the Annual Meeting of Stockholders to be held July 30, 2003 and the
Proxy Statement and appoints Susan Strausberg, Chief Executive Officer and
President, and Greg Adams, Chief Financial Officer and Chief Operating Officer
and each of them, the Proxy of the undersigned, with full power of substitution,
to vote all shares of Common Stock of EDGAR Online, Inc. (the "Company") which
the undersigned is entitled to vote, either on his or her own behalf or on
behalf of any entity or entities, at the Annual Meeting of Stockholders of the
Company to be held at the Company's offices, 50 Washington Street, Norwalk,
Connecticut 06854 on Wednesday July 30, 2003 at 10:00 a.m. local time (the
"Annual Meeting"), and at any adjournment or postponement thereof, with the same
force and effect as the undersigned might or could do if personally present
thereat. The shares represented by this Proxy shall be voted in the manner set
forth on the reverse side of this proxy.
1. To elect seven directors to serve for a one-year term ending in the
year 2004 or until each of their successors are duly elected and
qualified;
Jonathan Bulkeley
Benjamin Burditt
Stefan Chopin
Richard Feinstein
Mark Maged
Marc Strausberg
Susan Strausberg
[_]
FOR all nominees listed at left
(except as written below to the contrary)
[_]
WITHHOLD AUTHORITY
TO VOTE for all nominees listed at left
______________________________________________________________
Instruction: To withhold authority to vote for an
individual nominee, write the nominee's name in the
space provided above.
2. |_| FOR |_|AGAINST |_| ABSTAIN To ratify the appointment of KPMG LLP
as independent public accountants of the Company for the fiscal year ending
December 31, 2003.
3. |_| FOR |_|AGAINST |_| ABSTAIN In accordance with the discretion of the
proxy holders, to act upon all matters incident to the conduct of the
meeting and upon other matters as may properly come before the meeting.
The Board of Directors recommends a vote IN FAVOR OF the directors listed above
and a vote IN FAVOR OF the proposal to ratify the appointment of KPMG LLP as
independent public accountants. This Proxy, when properly executed, will be
voted as specified above. IF NO SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED
IN FAVOR OF THE ELECTION OF THE DIRECTORS LISTED ABOVE, TO RATIFY THE
APPOINTMENT OF KPMG LLP AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS, AND IN
ACCORDANCE WITH THE DISCRETION OF THE PROXIES OR PROXY WITH RESPECT TO ANY
OTHER MATTERS THAT COME BEFORE THE ANNUAL MEETING.
Please mark, date, sign and mail this proxy in the envelope provided for this
purpose.
Please print the name(s) appearing
on each share certificate(s) over
which you have voting authority: ____________________________________
Please sign your name:
_________________________ _________________________ ______
Signature(s) Signature if held jointly Date