SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
---------------------------------------
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
------------------------------------------------------------
Exchange Act of 1934 (Amendment No. __)
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the Com-
mission Only (as permitted by
Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
ACCESS WORLDWIDE COMMUNICATIONS, INC.
-------------------------------------
(Name of Registrant as Specified in Its Charter)
Not Applicable
-------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
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[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-
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to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
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offsetting fee was paid previously. Identify the previous filing by
registration statement number, or the form or schedule and the date of its
filing.
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[LOGO]
Notice of Annual Meeting of Stockholders
to be held on June 20, 2001
____________________
Boca Raton, Florida
May 5, 2001
To the Stockholders of
ACCESS WORLDWIDE COMMUNICATIONS, INC.:
The Annual Meeting of the Stockholders of ACCESS WORLDWIDE COMMUNICATIONS,
INC. (the "Company") will be held at the executive offices of the Company at
4950 Communication Avenue, Suite 300, Boca Raton, Florida 33431, at 11:00 a.m.,
local time, on Wednesday, June 20, 2001, to consider and act upon the following
matters:
1. To elect six directors as follows: (i) two directors to serve a
three-year term, two directors to serve a two-year term, and two
directors to serve a one-year term, or (ii) if Proposal Two is not
approved, six directors to serve a one-year term;
2. To approve an amendment to the Amended and Restated Certificate of
Incorporation of the Company (the "Certificate of Incorporation") to
provide for the classification of the Company's Board of Directors
(hereinafter referred to as the "Board of Directors" or the "Board");
3. To ratify the selection of PricewaterhouseCoopers LLP as the Company's
independent auditors; and
4. To transact such other business as may properly come before the
meeting or any adjournment or adjournments thereof.
The close of business on May 4, 2001, has been fixed by the Board of
Directors as the record date for the determination of stockholders entitled to
notice of, and to vote at, the annual meeting.
By Order of the Board of Directors,
Richard Lyew
Secretary
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, THE BOARD OF DIRECTORS URGES
YOU TO PROMPTLY MARK, SIGN AND DATE THE ENCLOSED FORM OF PROXY AND MAIL IT IN
THE ENCLOSED RETURN ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES, SO THAT YOUR VOTE CAN BE RECORDED AT THE MEETING IF YOU DO NOT ATTEND
PERSONALLY.
ACCESS WORLDWIDE COMMUNICATIONS, INC.
______________________
PROXY STATEMENT
______________________
This Proxy Statement, which will be mailed commencing on or about May 5,
2001, to the persons entitled to receive the accompanying Notice of Annual
Meeting of Stockholders, is provided in connection with the solicitation of
proxies on behalf of the Board of Directors of Access Worldwide Communications,
Inc. (the "Company") for use at the 2001 Annual Meeting of Stockholders (the
"Meeting") to be held on June 20, 2001, at 11:00 a.m., local time, at the
Company's executive offices, and at any adjournment or adjournments thereof, for
the purposes set forth in such notice. The Company's executive offices are
located at 4950 Communication Avenue, Suite 300, Boca Raton, Florida 33431.
Holders of record of issued and outstanding shares of common stock, $.01
par value per share ("Common Stock"), of the Company, as of May 4, 2001 (the
"Record Date"), will be entitled to notice of and to vote at the Meeting as
described below. On the Record Date, there were issued and outstanding 9,740,001
shares of Common Stock. The Company has no class or series of stock outstanding
and entitled to vote at the Meeting other than the Common Stock. Each share of
Common Stock is entitled to one vote with respect to each matter to be voted on
at the Meeting.
The presence, in person or by proxy, of the holders of a majority of the
outstanding shares of Common Stock entitled to vote at the Meeting is necessary
to constitute a quorum at the Meeting or any adjournments thereof. Except as
set forth below, abstentions and broker non-votes (as hereinafter defined) will
be counted as present for the purpose of determining the presence of a quorum.
Directors of the Company are elected by plurality vote. Adoption of
Proposal Two requires the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock entitled to vote thereon. Consequently, any
shares not voted (whether by abstention, broker non-vote or otherwise) will have
the same effect as votes against this proposal. A "broker non-vote" refers to
shares of Common Stock represented at the Meeting in person or by proxy by a
broker or nominee where such broker or nominee (i) has not received voting
instructions on a particular matter from the beneficial owners or persons
entitled to vote, and (ii) the broker or nominee does not have discretionary
voting power on such matter. Adoption of Proposal Three requires the affirmative
vote of the holders of a majority of the shares of Common Stock entitled to vote
thereon and present at the meeting in person or by proxy. For the purpose of
determining the vote required for approval of Proposals One and Three, shares
held by stockholders who abstain from voting will be treated as being "present"
and "entitled to vote" on the matter and, thus, an abstention has the same legal
effect as a vote against the matter. However, in the case of a broker non-vote
or where a stockholder withholds authority from his/her proxy to vote the proxy
as to Proposal One or Three, such shares will not be treated as "present" and
"entitled to vote" on the matter and, thus, a broker non-vote or the withholding
of a proxy's authority will have no effect on the outcome of the vote on the
matter.
Any proxy may be revoked at any time before it is exercised by written
notice to the Secretary of the Company. The casting of a ballot at the Meeting
by a stockholder who may theretofore have given a proxy will not have the effect
of revoking that proxy unless the stockholder so notifies the Secretary of the
Company in writing at any time prior to the voting of the shares represented by
the proxy.
PROPOSAL ONE
ELECTION OF DIRECTORS
Six directors will be elected at the Meeting. If the stockholders approve
Proposal Two, the Board of Directors will be divided into three classes with
staggered terms of office. The nominating committee of the Company ("Nominating
Committee") has determined that the initial classification of the Board will be
as follows: (i) the Class I directors, Peter D. Bewley and Lee H. Edelstein, who
will serve until the date of the 2002 Annual Meeting of Stockholders; (ii) the
Class II directors, Randall J. Lewis and Shawkat Raslan, who will serve until
the date of the 2003 Annual Meeting of Stockholders; (iii) and the Class III
directors, Michael Dinkins and Liam S. Donohue, who will serve until the date of
the 2004 Annual Meeting of Stockholders. At each Annual Meeting after 2001,
directors will be elected to succeed those directors whose terms then expire,
and each person so elected will serve for a three-year term. If Proposal Two is
not approved, directors elected at the Meeting will serve until the date of the
2002 Annual Meeting of Stockholders and until their respective successors are
duly elected and qualified.
All of the nominees are presently serving as directors. In case any of the
nominees are unable or decline to serve, such named persons reserve the right to
vote the shares represented by such proxy for another person duly nominated by
the Board of Directors in his stead or, if no other person is so nominated, to
vote such shares for the remaining nominees. The Board of Directors has no
reason to believe that any person named above will be unable or will decline to
serve. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF
THE NOMINEES NAMED ABOVE.
It is the intention of the persons named in the accompanying form of proxy
to vote the shares represented thereby in favor of the election of each of the
nominees named above unless otherwise instructed in such proxy.
Certain information concerning the nominees for election as directors is
set forth below. Such information was furnished by them to the Company.
2
Name of Nominee and Shares of Common Percent
Biographical Information Stock Owned of Class
Beneficially as of
May 1, 2001
- --------------------------------------------------------------------------------
Peter D. Bewley, age 54, has been a 36,669 (1) *
director of the Company since May 1997.
Mr. Bewley has been Senior Vice
President, General Counsel and Secretary
of The Clorox Company since February
1998. From May 1994 to February 1998, he
was Senior Vice President, General
Counsel and Secretary of NovaCare, Inc.
("NovaCare"), a provider of
comprehensive rehabilitation services.
Prior to joining NovaCare, Mr. Bewley
was employed as an attorney with Johnson
& Johnson for 17 years, most recently as
Associate General Counsel. Before that,
he served as an associate with the law
firm of Wilmer, Cutler & Pickering from
1972 to 1977.
Michael Dinkins, age 47, has been the 49,110 (2) *
Chairman of the Board since March 2000,
and a director, as well as President and
Chief Executive Officer of the Company
since July 1999. Previously, Mr. Dinkins
had been the Chief Financial Officer
from August 1997 until July 1999. From
May 1996 to August 1997, he was
President of Cadmus Graphic
Communications Group. From September
1993 to May 1996, he was Chief Financial
Officer of Cadmus Communications
Corporation. From 1976 to 1993, he
served in various managerial and
financial positions for General Electric
Company, Inc. Mr. Dinkins currently
serves as a director of the LandAmerica
Financial Group, Inc.
Liam S. Donohue, age 33, has been a 3,700 *
director of the Company since December
1996. Mr. Donohue is a founding partner
of DHM Arcadia Partners, a private
equity fund investing in the for-profit
education and training industry. From
1995 through 1998, Mr. Donohue was a
principal of Foster Management Company,
a private equity investment firm. In
1994, he was an Associate in the Salomon
Brothers Corporate Finance Group in
London. From 1989 to 1993, he was an
Associate with Booz, Allen and Hamilton,
Inc.'s International Environmental
Management Practice and started Booz,
Allen's office in Budapest, Hungary.
Lee H. Edelstein, age 53, has been a 201,016 2.0%
director of the Company since October
1997. Mr. Edelstein is the President of
LHE Consulting, Inc., a
business-consulting firm. From January
1997 to May 1999, Mr. Edelstein was
President of the Company's TMS
Professional Markets Group. In 1992, he
founded TeleManagement Services, Inc.
("TMS"), a pharmaceutical and healthcare
direct marketing and teleservices
company acquired by the Company in
January 1997. Prior to founding TMS, Mr.
Edelstein worked for Goldline
Laboratories, a division of IVAX Corp.,
a pharmaceutical company, for eleven
years in various management positions
including Operations Manager, Director
of Marketing and Vice President of
3
Shares of Common
Stock Owned
Name of Nominee and Beneficially as of Percent
Biographical Information May 1, 2001 of Class
- --------------------------------------------------------------------------------
Marketing and Business Development.
Randall J. Lewis, age 38, has been a 5,000 *
director of the Company since May 2000.
Since November 1999, Mr. Lewis has
served as Executive Vice President and
Chief Auditor of Wells Fargo & Co.
("Wells Fargo"), a financial services
company. From July 1997 to November
1999, Mr. Lewis served as Vice President
of Corporate Development of Wells Fargo.
From 1984 to 1997, Mr. Lewis served in
various finance and operations positions
for General Electric Company, most
recently as Chief Financial Officer of
GE Consumer Financial Services.
Shawkat Raslan, age 49, has been a 19,003 (3) *
director of the Company since May 1997.
Since June 1983, Mr. Raslan has served
as President and Chief Executive Officer
of International Resources Holdings,
Inc., an asset management and investment
advisory service for international
clients. Prior thereto, he served as
Vice President of Trans Arabian
Investment Bank in Bahrain from 1980 to
1983. From 1976 to 1980, Mr. Raslan was
a liaison officer and engineer for
Turner International, a construction
management company. He currently serves
as a director of Tiedemann Investment
Group, Parisco Ltd., St. James's Club
Antigua, and Integra, Inc. Mr. Raslan is
the managing partner of Prima Partners
LP and Links Venture Partners LP.
* Less than one percent. As of May 1, 2001, each director had sole voting
and investment power with respect to all shares shown in the table as
beneficially owned by him.
(1) Includes 25,669 shares of Common Stock presently issuable upon exercise of
options and 2,003, which were surrendered pursuant to a Repricing Program
dated March 27, 2001.
(2) Includes 42,110 shares of Common Stock presently issuable upon exercise of
options and 85,082, which were surrendered pursuant to a Repricing Program
dated March 27, 2001.
(3) Includes 4,003 shares of Common Stock presently issuable upon exercise of
options and 23,670, which were surrendered pursuant to a Repricing Program
dated March 27, 2001.
4
During the fiscal year ended December 31, 2000, the Board of Directors met
eight times. All of the incumbent directors attended more than 75% of the
meetings of the Board of Directors and the total number of meetings held by all
committees of the Board of Directors.
The Board has a compensation committee ("Compensation Committee"), an audit
committee ("Audit Committee"), a capital and finance committee ("Capital and
Finance Committee") and the Nominating Committee.
The Compensation Committee reviews and makes recommendations regarding the
compensation for executive officers and other key employees of the Company,
including salaries and bonuses. No member of the Compensation Committee is an
officer of the Company. The current members of the Compensation Committee are
Shawkat Raslan, Peter D. Bewley, Liam S. Donohue and Randall J. Lewis. The
Compensation Committee has a stock option subcommittee ("Stock Option
Subcommittee"). The members of the Stock Option Subcommittee are Peter D.
Bewley, Randall J. Lewis and Shawkat Raslan. The Stock Option Subcommittee
administers the Company's stock option plan ("Stock Option Plan") and determines
the persons who are to receive options, the number of shares subject to each
option and the terms, including the exercise price, of such options. The
Compensation Committee met twice in 2000.
The members of the Audit Committee are Peter D. Bewley, Liam S. Donohue,
Randall J. Lewis and Shawkat Raslan. The Audit Committee acts as a liaison
between the Board and the independent accountants and annually recommends to the
Board the appointment of the independent accountants. The Audit Committee
reviews with the independent accountants the scope of their examination of the
Company's financial statements, the adequacy of internal accounting controls and
otherwise performs the duties described in the Audit Committee charter, a copy
of which is attached to this Proxy Statement as Appendix A. The Audit Committee
met seven times during 2000.
The members of the Capital and Finance Committee are Liam S. Donohue, Lee
H. Edelstein and Randall J. Lewis. The Capital and Finance Committee reviews the
financial condition of the Company so as to counsel the Board on the total
financial resources, strength and capabilities of the Company and is authorized
to explore and recommend various forms of financing and capital facilities. The
Capital and Finance Committee is authorized to approve acquisitions of
businesses having an aggregate purchase price of less than $1,000,000. The
Capital and Finance Committee met four times in 2000.
The members of the Nominating Committee are Lee H. Edelstein, Peter D.
Bewley and Shawkat Raslan. The Nominating Committee is authorized to review,
approve and recommend to the Board persons for election as directors. The
Nominating Committee met once during 2000. In addition, the Nominating Committee
will consider written nominations by stockholders, which are submitted to the
Chairman of the Nominating Committee and addressed in care of the Secretary,
Access Worldwide Communications, Inc., 4950 Communication Avenue, Suite 300,
Boca Raton, Florida 33431.
5
Compensation of Directors
Non-management directors of the Company receive an annual retainer of
$15,000, excluding the Chairman. A non-management Chairman would be entitled to
receive an annual retainer of $17,500. In addition, non-management directors of
the Company receive fees of $1,000 for each meeting attended in person, $500 for
each committee meeting attended on a day other than the day of a full Board of
Directors meeting and $500 for each Board of Directors or committee meeting
attended via teleconference. New non-management directors of the Company receive
options to purchase 10,000 shares of Common Stock at the closing price on the
day they are elected while existing non-management directors receive options to
purchase 5,000 shares of Common Stock on each annual meeting date. These stock
options vest evenly over three years. In addition, in the event that the Chief
Executive Officer is awarded a 100% bonus payment with respect to any fiscal
year, each non-management director receives an additional option to purchase
5,000 shares of Common Stock on the date that bonus payment is approved.
Directors who are officers of the Company do not receive any additional
compensation for serving on the Board. Directors are reimbursed for out-of-
pocket expenses related to their duties.
Peter D. Bewley, Liam S. Donohue, Lee Edelstein and Shawkat Raslan were
each granted options to purchase 5,000 shares of Common Stock on February 29,
2000 and Randall J. Lewis was granted an option to purchase 10,000 shares of
Common Stock on May 30, 2000.
6
EXECUTIVE OFFICERS
The Company's executive officers and their ages are as follows:
Name Age Position
- ---- --- --------
Michael Dinkins 47 Chairman of the Board, President and
Chief Executive Officer
John Hamerski 49 Executive Vice President and Chief Financial
Officer
Joseph Macaluso 60 Executive Vice President of Sales
Barbara Monaghan 43 Senior Vice President and Chief Operating
Officer - AM Medica Communications Group
Robert Regazzi 62 Senior Vice President and Chief Operating
Officer - Phoenix Marketing Group
Bernard Tronel 43 Senior Vice President and Chief Operating
Officer - Teleservices Group
Below is a summary of the business experience of each of the executive
officers. The business experience of Mr. Dinkins appears under the caption
"Proposal One - Election of Directors" above.
John Hamerski has been Executive Vice President and Chief Financial Officer of
Access Worldwide since July 2000. He joined the Company in November 1997 as
Senior Vice President, Financial Planning and Analysis. From March 1995 to
November 1997, he worked at Cadmus Communications Corporation, a printing and
communications company, his most recently position as Vice President and Chief
Financial Officer for Cadmus Interactive.
Joseph Macaluso has been the Executive Vice President of Sales for the Company's
Phoenix Marketing Group since January 2001. For the year 2000, Mr. Macaluso held
the position of Executive Vice President of Sales for the Company. Earlier in
his career Mr. Macaluso was responsible for product development, sales,
marketing and customer and industry relations of the Phoenix Marketing Group, a
company he co-founded in 1983 that was acquired by Access Worldwide in 1997.
Robert Regazzi has been Senior Vice President of Access Worldwide and Chief
Operating Officer of the Company's Phoenix Marketing Group since December 1999.
He joined Access Worldwide in September 1998 in the then newly created role of
Senior Vice President and General Manager of the Company's Phoenix Marketing
Group. From June 1996 to August 1998, Mr. Regazzi was President and Chief
Executive Officer of Product Knowledge Systems, Inc., a training and education
company, where he developed operating, sales, finance, administration and
research and development infrastructures.
Bernard Tronel has been Senior Vice President of Access Worldwide and Chief
Operating Officer of the Company's Teleservices Group since April 1999. From May
1996 to March 1999, he was Vice President and General Manager for the ICT Group,
a teleservices company, where he oversaw five call centers generating 100,000
hours of call production each month. From October 1994 to May 1996, he was
Worldwide Director of Telemarketing for the Franklin Mint, a creator and
supplier of collectibles. In that position, he oversaw call centers that
employed more than 1,200 employees and opened an office in London.
7
Barbara Monaghan has been Senior Vice President of Access Worldwide and Chief
Operating Officer of the Company's AM Medica Communications Group since
November 2000. From October 1993 to October 1998, Ms. Monaghan was Vice
President and Client Services Director of AM Medica Communications Ltd., and
continued in such position through November 2000 after the Company purchased AM
Medica Communications Ltd. in October 1998.
8
Executive Compensation
The following table sets forth information for the fiscal years ended
December 31, 2000, 1999 and 1998, concerning the compensation of the Company's
Chief Executive Officer, Chief Financial Officer and the four other most highly
compensated executive officers of the Company whose total annual salary and
bonus exceeded $100,000 during the fiscal year ended December 31, 2000 (the
"Named Executive Officers").
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term
-------------------------------------------------- Compensation Award
------------------------------------
Other Securities
Annual Underlying All Other
Year Salary Bonus Compensation Options Compensation
Name and Principal Position ($) ($) ($) (#) ($)(1)
- -------------------------------------------------------------------------------------------------------------------------
Michael Dinkins, Chairman, 2000 $292,315 $100,000 __ 10,000 $ 1,450
President and Chief Executive 1999 238,000 __ $55,566(2) 200,000 4,049
Officer 1998 200,000 80,000 __ 75,000 1,309
John Hamerski, Executive Vice 2000 142,000 50,000 __ 26,500 505
President and Chief Financial 1999 115,000 20,000 43,541(3) 2,000 505
Officer 1998 95,000 21,500 29,482(3) 12,500 505
Joseph Macaluso, Executive 2000 248,205 50,000 8,400 4,000 14,644
Vice President of Sales 1999 163,455 __ 8,400 2,000 12,038
1998 149,994 __ 8,400 __ 12,500
Barbara Monaghan, Senior Vice 2000 212,235 __ __ 1,500 __
President and Chief Operating 1999 170,135 __ __ 3,000 __
Officer - AM Medica 1998 109,000 __ __ __ __
Communications Group(4)
Robert Regazzi, Senior Vice 2000 205,620 63,600 __ 4,000 5,815
President and Chief Operating 1999 158,990 20,147 __ 2,000 2,878
Officer - Phoenix Marketing 1998 48,459 10,000 50,000(6) 50,000 __
Group(5)
Bernard Tronel, Senior Vice 2000 218,021 58,450 6,000 4,000 2,430
President and Chief Operating 1999 124,217 20,000 30,000(8) 15,000 1,569
Officer-Teleservices Group(7) 1998 __ __ __ __ __
(1) Includes contributions made by the Company on behalf of the Named Executive
Officers to the Company's 401(k) plan, medical and dental insurance plans,
term life/disability insurance plans and other benefits.
(2) Mr. Dinkins received $55,566 in moving expenses in 1999.
(3) Mr. Hamerski received $29,482 and $43,541 in moving expense in 1998 and
1999, respectively.
(4) Appointed Chief Operating Officer of AM Medica Communications, Inc. on
November 17, 2000.
(5) Mr. Regazzi's employment commenced on September 1, 1998.
(6) Mr. Regazzi received $50,000 in moving expenses in 1998.
(7) Mr. Tronel's employment commenced on February 22, 1999.
(8) Mr. Tronel received $25,000 in moving expenses and $5,000 automobile
allowance in 1999.
9
The following table sets forth the grants of stock options to the Named
Executive Officers during the fiscal year ended December 31, 2000. The amounts
shown for each of the Named Executive Officers as potential realizable values
are based on arbitrarily assumed annualized rates of stock price appreciation of
five percent and ten percent over the exercise price of the options during the
full terms of the options. Actual gains, if any, on option exercises and
holdings of Common Stock are dependent on the future performance of the Common
Stock and overall stock market conditions.
Option Grants in the Fiscal Year Ended
December 31, 2000
Potential Realizable
Individual Grants Value at Assumed
----------------- Annual
Number of % of Total Rates of Stock Price
Securities Options Appreciation for
Underlying Granted to Exercise Option Term
Options Employees Price or ---------------------------
Name Granted in Fiscal Base Expiration 5% 10%
(#) Year ($/Sh) Date ($) ($)
- -----------------------------------------------------------------------------------------------------------------------------
Michael Dinkins, Chairman, 10,000 4.87% $2.375 2/29/10 $14,936 $37,851
President and Chief Executive
Officer
John Hamerski, Executive Vice 1,500 0.73% $2.375 2/29/10 2,240 5,678
President and Chief Financial 25,000 12.17% $1.250 8/18/10 19,653 49,804
Officer
Joseph Macaluso, Executive Vice 4,000 1.95% $2.375 2/29/10 5,974 15,141
President of Sales
Barbara Monaghan, Senior Vice 1,500 0.73% $2.375 2/29/10 2,240 5,678
President and Chief Operating
Officer - AM Medica
Communications Group
Robert Regazzi, Senior Vice 4,000 1.95% $2.375 2/29/10 5,974 15,141
President and Chief Operating
Officer - Phoenix Marketing Group
Bernard Tronel, Senior Vice 4,000 1.95% $2.375 2/29/10 5,974 15,141
President and Chief Operating
Officer - Teleservices Group
10
The following table sets forth the number and value, net of exercise price,
of shares of Common Stock acquired upon exercise of options on the date of
exercise by the Named Executive Officers during the fiscal year ended December
31, 2000, and the number and value of options held by such Named Executive
Officers at December 31, 2000.
Aggregate Option Exercises in the Fiscal Year
Ended December 31, 2000 and Fiscal Year End Option Values
Number of Securities Underlying
Unexercised Value of Unexercised
Options at In-the Money Options
Shares Fiscal Year-End At Fiscal Year-End (1)
Acquired Value --------------------------------------------------------------
on Exercise Realized
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ------------------------------------------------------------------------------------------------------------------
Michael Dinkins, __ __ 127,192 242,808 __ __
Chairman, President and
Chief Executive Officer
John Hamerski, Executive __ __ 7,208 33,792 __ __
Vice President and
Chief Financial Officer
Joseph Macaluso, __ __ 7,201 10,799 __ __
Executive Vice
President of Sales
Barbara Monghan, Senior __ __ 1,102 3,398 __ __
Vice President and
Chief Operating
Officer - AM Medica
Communications Group
Robert Regazzi, Senior __ __ 21,228 34,772 __ __
Vice President and
Chief Operating Officer
- Phoenix Marketing
Group
Bernard Tronel, Senior __ __ 5,808 13,192 __ __
Vice President and
Chief Operating Officer
- Teleservices Group
__________
(1) In-the-money options are those options where the then fair market value of
the underlying Common Stock exceeds the exercise price thereof. The value
of in-the-money options is determined in accordance with regulations of the
Securities and Exchange Commission by subtracting the aggregate exercise
price of the options from the aggregate year-end market value of the
underlying Common Stock.
11
Employment Arrangements
The Company has entered into employment arrangements with the Named
Executive Officers, as described below. All of those arrangements provide for,
among other things (i) non-compete and non-disclosure agreements; and (ii) other
than in Mr. Regazzi's and Mr. Tronel's employment agreements, the continuation
of compensation payments to a disabled executive officer until such officer has
been unable to perform the services required of him for the period of time set
forth therein. Each agreement also provides for health insurance and other
benefits.
The Company entered into a four-year employment agreement, effective as of
July 29, 1999, with Michael Dinkins, the Chairman of the Board, President and
Chief Executive Officer, which is automatically renewable for successive one-
year terms unless either party provides at least 180 days prior written notice
of an intention not to renew the agreement. The agreement, as amended on
December 21, 2000, provides for, among other things, Mr. Dinkins to receive an
initial annual base salary of $300,000, plus an annual incentive bonus of up to
50% of his then current annual base salary based upon the achievement of certain
quantitative and qualitative goals to be mutually agreed upon by Mr. Dinkins and
the Compensation Committee. In addition, Mr. Dinkins is eligible to receive
merit increases in his annual base salary as determined by the Compensation
Committee. Mr. Dinkins' current annual base salary is $318,000. In the event
that the Company exceeded the earnings before interest, taxes, depreciation, and
amortization ("EBITDA") target set by Mr. Dinkins and the Compensation Committee
by at least 25% for the year ended December 31, 2000, Mr. Dinkins' would be
entitled to receive a bonus equal to 100% of his then current annual base
salary; provided, however, that such bonus would be prorated between 50% and
100% of his then current annual base salary in the event the Company exceeded
its EBITDA target by less than 25%. In connection with the agreement, Mr.
Dinkins was granted a ten-year option to purchase 200,000 shares of the Common
Stock, which option vests equally over five years. The agreement also provides
for the payment to Mr. Dinkins of certain moving and relocation expenses. If
Mr. Dinkins' employment is (i) terminated without cause, or (ii) terminated
within two years after a change of control (as defined therein), with specified
exceptions, he is entitled to receive an amount equal to twice his then current
annual base salary. In addition, if Mr. Dinkins' employment is terminated
without cause he is entitled to receive a pro rata share of the total amount of
the bonus that he would otherwise be entitled to for the year in which the
termination occurs as if he had met all of the established target goals for that
year.
The Company entered into a three-year employment agreement, effective as of
December 5, 2000, with John Hamerski, Executive Vice President and Chief
Financial Officer, which provides for, among other things, Mr. Hamerski to
receive an initial annual base salary of $180,000, plus an annual incentive
bonus of up to 40% of his then current annual base salary based upon the
achievement of quantitative and qualitative goals established by the Chief
Executive Officer of the Company. In addition, Mr. Hamerski is eligible to
receive merit increases in his annual base salary as determined by the Chief
Executive Officer. Mr. Hamerski's current annual base salary is $180,000. If Mr.
Hamerski's employment is terminated within two years after a change of control
(as defined therein), with specified exceptions, he is entitled to receive (i)
an amount equal to his then current annual base salary, and (ii) a bonus of 40%
of his then current annual base salary, prorated to the date of termination;
provided, that the target goals established by the Chief Executive Officer have
been met or are reasonably on track to be
12
met. If Mr. Hamerski's employment is terminated without cause and he is not
otherwise entitled to the termination payment described above, he is entitled to
receive continuing payments of his then current annual base salary for a period
of one year.
The Company entered into a five-year employment agreement, effective as of
October 17, 1997, with Joseph Macaluso, Executive Vice President of Sales of the
Phoenix Marketing Group ("Phoenix "), which provides for, among other things,
Mr. Macaluso to receive an initial annual base salary of $150,000, plus an
annual incentive bonus of up to 20% of his then current annual base salary based
upon the achievement by Phoenix of certain financial performance goals
established by the Chief Executive Officer of the Company. In addition, Mr.
Macaluso is eligible for merit increases in his annual base salary as determined
by the Chief Executive Officer. For the year 2000, Mr. Macaluso held the
position of Executive Vice President of Sales of the Company. Mr. Macaluso's
current annual base salary is $215,000. Under the agreement, Mr. Macaluso was
granted an option to purchase 12,000 shares of the Common Stock, which vests
equally over two years. If Mr. Macaluso's employment is terminated without due
cause and provided that his employment is not terminated due to death or
disability, he is entitled to receive continuing payments of his then current
annual base salary for a period ending on the earlier of (i) the scheduled
expiration date of the term of the agreement, or (ii) six months following the
date of termination.
The Company entered into an employment agreement, effective as of March 29,
1999, with Bernard Tronel, Senior Vice President and General Manager of the
Company's TMS Professional Markets Group ("TMS"). The agreement provides for an
initial annual base salary of $175,000, plus an annual incentive bonus of up to
40% of Mr. Tronel's then current annual base salary based upon the attainment of
certain qualitative and quantitative goals established by Mr. Tronel and the
President of the TMS . Under the agreement, Mr. Tronel was granted an option to
purchase 10,000 shares of the Common Stock, which vests equally over five years.
The agreement also provides for the payment to Mr. Tronel of certain moving
expenses. Under the agreement, if Mr. Tronel's employment is terminated without
cause or involuntarily, whether or not due to a change of control (as defined in
the agreement), Mr. Tronel will be entitled to receive an amount equal to one-
half of his then current annual base salary plus an amount equal to one month of
his then current annual base salary for each year of service with the Company,
the total payments of which are not to exceed twelve months of his then current
annual base salary. Mr. Tronel was promoted to Senior Vice President and Chief
Operating Officer of the Teleservices Group in 1999 and his current annual base
salary is $200,000.
The Company has entered into an employment arrangement, effective as of
September 1, 1998, with Robert Regazzi, Senior Vice President and General
Manager of the Company's Phoenix Marketing Group ("PMG"). The agreement provides
for an initial annual base salary of $150,000, plus an annual incentive bonus
between $5,000 and $10,000 based upon the attainment of certain short-term goals
established by Mr. Regazzi and the President of the PMG. In addition, under
this agreement, Mr. Regazzi was granted an option to purchase 50,000 shares of
the Common Stock, which vests equally over five years. The agreement also
provides for the payment to Mr. Regazzi of $50,000 for moving expenses. Under
the agreement, if Mr. Regazzi's employment is terminated during the first three
years for any reason other than criminal behavior or gross misconduct, Mr.
Regazzi will be entitled to receive an amount equal to six months of his
13
then current annual base salary. Mr. Regazzi was promoted to Chief Operating
Officer of PMG in 1999 and his current annual base salary is $212,000.
The Company has entered into a five-year employment arrangement, effective
as of April 12, 1999, with Barbara Monaghan, Vice President and Client Services
Director of the Company's AM Medica Communications Group ("AM Medica"). The
agreement, as amended on November 17, 2000, provides for Ms. Monaghan to be the
Senior Vice President and Chief Operating Officer of AM Medica, at an initial
annual base salary of $200,000, subject to annual review, plus commission
payments based on gross sales in an amount ranging from 2% to 6.5% of gross
sales. In addition, under this agreement, Ms. Monaghan was granted an option to
purchase 10,000 shares of Common Stock, which vests equally over five years, as
well as additional options to purchase 4,000 shares of Common Stock annually
thereafter. Under the agreement, if Ms. Monaghan's employment is terminated by
the Company during the five-year term for any reason other than cause, Ms.
Monaghan will be entitled to receive an amount equal to three months of her then
current annual base salary plus an amount equal to two months of her then
current annual base salary for each year of service with the Company, the total
payments of which are not to exceed twelve months of her then current annual
base salary. Ms. Monaghan's current annual base salary is $200,000.
PERFORMANCE GRAPH
The Company's Common Stock began trading on the Nasdaq National Market
System on February 13, 1998 when its initial public offering commenced. The
following performance graph shows the total return to stockholders of an
investment in the Company's Common Stock as compared to the cumulative total
return of (i) the Nasdaq Index, (ii) the Company's peer group index used in its
1999 Proxy Statement ("Old Peer Group Index"), and (iii) the Company's peer
group index used this year's Proxy Statement ("New Peer Group Index"), for the
period commencing February 13, 1998 and ending December 31, 2000. The graph
assumes that $100 was invested on February 13, 1998 in each of the Company's
Common Stock, the Nasdaq Index, the companies listed in the Old Peer Group Index
and the companies listed in the New Peer Group Index (on a weighted market value
basis) and that all dividends were reinvested.
This year, the companies comprising the Old Peer Group Index were changed.
Applied Analytical Industries, Inc., currently known as aaiPharma, Inc., has
restructured its business and the Company believes that its business is no
longer comparable to that of the Company. Snyder Communications, Inc. was
acquired by Havas Advertising in September 2000 and was subsequently de-listed
from the New York Stock Exchange. As a result, the Company added Catalina
Marketing Corporation and Quintiles Transnational Corp. to comprise the New Peer
Group Index. The Company believes that the businesses conducted by these two
companies are comparable to the Company's business.
14
COMPARISON OF CUMULATIVE TOTAL RETURN
AMONG THE NASDAQ INDEX, THE OLD PEER GROUP INDEX(1), THE NEW PEER GROUP INDEX(2)
AND ACCESS WORLDWIDE COMMUNICATIONS, INC.
[GRAPH]
[PLOT POINTS]
02/13/98 12/31/98 12/31/99 12/31/00
-------- -------- -------- --------
AWWC $100.000 $ 69.792 $ 19.792 5.208
New Peer Group $100.000 $269.420 $140.901 142.127
Old Peer Group $100.000 $103.521 $ 70.141 75.911
Nasdaq Composite Index $100.000 $128.196 $237.913 144.439
2/13/1998 12/31/98 12/31/1999 12/31/2000
---------- --------- ----------- -----------
NASDAQ Index $ 100 $ 129 $ 238 $ 144
Old Peer Group Index $ 100 $ 104 $ 70 $ 76
New Peer Group Index $ 100 $ 269 $ 141 $ 142
Access Worldwide Communications, Inc $ 100 $ 70 $ 20 $ 5
(1) Companies in the Old Peer Group Index are as follows: Applied Analytical
Industries, Inc currently known as aaiPharma, Inc., Boron, LePore &
Associates, Inc., Parexel International Corporation, and Snyder
Communications, Inc.
(2) Companies in the New Peer Group Index are as follows: Boron, LePore &
Associates, Inc., Catalina Marketing Corporation, Parexel International
Corporation, and Quintiles Transnational Corp.
15
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee and the Stock Option Subcommittee (collectively,
the "Committee"), are composed of four outside directors and three outside
directors, respectively, and are responsible for administering the Company's
executive compensation program.
The Company's executive compensation program is intended to attract,
motivate and retain key executives who are capable of leading the Company
effectively and fostering its long-term growth. The compensation program for
executives is comprised of base salary, annual incentives and long-term
incentive awards. The Committee's compensation philosophy is based upon the
belief that success of the Company results from the coordinated efforts of all
Company employees working as a team to achieve objectives of providing superior
services to the Company's clients and maximizing the Company's value for the
benefit of its stockholders.
The Committee reviews significant qualitative components in evaluating the
individual performance of each executive officer. These components include such
executive officer's leadership, teambuilding and motivational skills,
adaptability to rapid change, and ability to assimilate new technical knowledge
to meet the demands of the Company's clients. In this qualitative evaluation,
the Committee exercises its collective judgment as to the executive officer's
contributions to the growth and success of the Company during the prior year and
the expected contributions of such executive officer in the future.
Base Salary: Base salary is determined by level of responsibility and
individual performance as well as by the need to provide a competitive package
that allows the Company to attract and retain key executives. After reviewing
individual and Company performance, the Chief Executive Officer makes
recommendations to the Compensation Committee concerning each executive
officer's base salary. The Compensation Committee reviews and, with any changes
it deems appropriate, approves these recommendations.
Executive Bonuses: Bonuses provide the opportunity for executive officers
to earn as additional compensation, a percentage of the executive officer's
annual base salary by achieving the Company's strategic and financial
performance goals. The bonuses based on achievement of the goals are
established by the Chief Executive Officer and reviewed and approved by the
Compensation Committee.
The key components in determining the amount of such bonuses include the
financial performance of the Company and the progress of the Company in
achieving its long-term strategic objectives. The judgment of each member of the
Compensation Committee and the Chief Executive Officer, in the case of other
executive officers, as to the impact of the individual or the support of the
individual to their teams on the financial performance and strategic progress of
the Company also are considered.
Stock Options: The Stock Option Plan is administered by the Stock Option
Subcommittee. The Stock Option Subcommittee consists of Peter D. Bewley,
Randall J. Lewis and Shawkat Raslan.
16
The Board of Directors and Stock Option Subcommittee believe that long-term
incentive compensation in the form of stock options is the most effective way of
making executive compensation dependent upon increases in shareholder value. In
addition, the Stock Option Subcommittee believes that stock option grants are an
effective means of attracting and retaining qualified key executives, an
essential element in the Company's highly regulated and client relationship-
driven industry. The Company's Stock Option Plan provides the means through
which executives can build an investment in Common Stock which aligns such
executive officers' economic interest with the interest of stockholders.
The exercise price of each option has been the market price of the Common
Stock on the date of grant. The grants provide for a delayed vesting period and
have a ten-year term. The Committee believes that stock options give the
executive officers incentives throughout the term of the options to strive to
operate the Company in a manner that directly affects the financial interests of
the stockholders both on the long-term, as well as a short-term basis.
In determining the number of option shares to grant to executive officers,
the Committee considers the same factors as it does in determining the other
components of compensation. The recommendation of the Chief Executive Officer is
significant in determining awards to persons other than himself.
Decisions Regarding 2000 Compensation: The Company reorganized, downsized
several operations and implemented a six-month delay in salary increases. The
Company's performance for the year 2000 included an EBITDA increase of 89% or
$3.2 million and a reduction in the Company's debt by $8.8 million. In addition,
the Company retained all its key clients, formed several strategic alliances and
successfully completed the sale of the Plano, Texas communications center. With
respect to non-financial performance, management continued to implement its
leadership model, which embodies principled-centered leadership that addresses
clients, associates and the community.
Based upon the attainment of the above quantitative financial performance,
the Compensation Committee awarded bonuses for 2000 to the Named Executive
Officers, excluding Mr. Dinkins, which were primarily within 50% to 75% of
targeted bonus amount.
Mr. Dinkins' compensation award was based upon the Compensation Committee's
assessment of the Company's financial performance as outlined above and its non-
financial performance against criteria that were established at the beginning of
fiscal year 2000.
Mr. Dinkins salary increase was delayed six months and he received a 6%
base salary increase. Mr. Dinkins was awarded a bonus of $100,000 or 64% of his
targeted bonus amount. Mr. Dinkins also received his targeted long-term
incentive of 10,000 stock options, which were granted at fair market value on
February 29, 2000.
Deductibility of Executive Compensation: Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"), limits the deductibility of
compensation exceeding $1 million to the Company's Chief Executive Officer and
each of the four other most highly compensated executive officers. Qualifying
performance-based compensation meeting the requirements promulgated by the
Internal Revenue Service under Section 162(m) will not be subject to the
17
deduction limit. The Company intends to conform its executive compensation
arrangements with such requirements.
The Compensation Committee believes that its compensation policies promote
the goals of attracting, motivating, rewarding and retaining talented executive
officers who will maximize value for the Company's stockholders.
COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
Shawkat Raslan
Peter D. Bewley
Liam S. Donohue
Randal J. Lewis
REPORT OF THE AUDIT COMMITTEE
On June 13, 2000, the Board of Directors adopted an Audit Committee Charter
under which the Audit Committee operates. The Audit Committee Charter, as
amended, is attached to this Proxy Statement as Appendix A.
Management has the primary responsibility for the Company's internal
controls, the financial reporting process and preparation of the consolidated
financial statements of the Company. The independent auditors are responsible
for performing an independent audit of the Company's consolidated financial
statements in accordance with generally accepted accounting principles and to
issue a report thereon. The Audit Committee's responsibility is to monitor and
oversee these processes.
The Audit Committee reviewed and discussed the audited consolidated
financial statements with management and the independent auditors. Management
represented to the Audit Committee that the Company's audited consolidated
financial statements were prepared in accordance with generally accepted
accounting principles. The Audit Committee also discussed with
PricewaterhouseCoopers LLP the matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees), as amended by
Statement on Auditing Standards No. 90 (Audit Committee Communications).
In fulfilling its responsibilities, the Audit Committee received from
PricewaterhouseCoopers LLP the written disclosures and letter required by
Independence Standards Board Standard No. 1 (Independence Discussions with Audit
Committees), has discussed with PricewaterhouseCoopers LLP their independence
from the Company and has considered whether the provision of non-audit services
to the Company is compatible with the independence of PricewaterhouseCoopers
LLP.
18
Based upon the Audit Committee's discussions with management and the
independent auditors and the Audit Committee's review of the representations of
management and the report and letter of the independent auditors provided to the
Audit Committee, the Audit Committee recommended to the Board of Directors that
the audited consolidated financial statements be included in the Company's
Annual Report on Form 10-K for the year ended December 31, 2000, for filing with
the Securities and Exchange Commission.
AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
Peter D. Bewley
Liam S. Donohue
Randall J Lewis
Shawkat Raslan
Audit Fees
PricewaterhouseCoopers LLP, advised the Audit Committee that it provided
$180,000 of audit services to the Company during the Company's fiscal year ended
December 31, 2000.
All Other Fees
PricewaterhouseCoopers LLP, advised the Audit Committee that it provided
$14,000 of other services to the Company during the Company's fiscal year ended
December 31, 2000. Other services include (i) audit of the Company's 401(k)
plan, and (ii) evaluating the effects of various accounting issues and changes
in professional standards on the Company's financial statements.
PricewaterhouseCoopers LLP advised the Audit Committee that it did not believe
its audit was impaired by its provision of such services, particularly in view
of the relationship of the related fees to its annual revenues. As a result,
PricewaterhouseCoopers LLP has confirmed that it was an independent accountant
with respect to the Company within the meaning of the Exchange Act (as defined
below) administered by the Securities and Exchange Commission and the
requirements of the Independence Standards Board.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors and executive officers, and
persons who own more than ten percent of the Company's Common Stock, to file
with the Securities and Exchange Commission initial reports of ownership and
reports of changes in ownership of Common Stock. Officers, directors and greater
than ten percent stockholders are required by Securities and Exchange Commission
regulations to furnish the Company with copies of all Section 16(a) reports they
file.
To the Company's knowledge, based solely on a review of copies of such
reports furnished and confirmations that no other reports were required during
the fiscal year ended
19
December 31, 2000, its directors, executive officers and greater than ten
percent stockholders complied with all Section 16(a) filing requirements.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Agreements with Lee H. Edelstein
TLM Holdings Corp., a wholly-owned subsidiary of the Company ("TLM
Holdings"), Mr. Lee H. Edelstein, a director of the Company, and TeleManagement
Services, Inc. ("TeleManagement"), which was then owned primarily by Mr.
Edelstein, entered into an agreement dated January 1, 1997, as subsequently
amended ("TeleManagement Agreement"), whereby TLM Holdings purchased
substantially all of the assets of TeleManagement. The purchase price for the
assets was as follows: (i) $6,500,000 in cash, (ii) the issuance by TLM Holdings
of a 6% convertible subordinated promissory note (current interest rate is 10%
due to a default under such note by TLM Holdings), in the principal amount of
$1,300,000, which was subsequently assigned by TeleManagement to Mr. Edelstein,
payable in the following manner: (i) all unpaid accrued interest is payable on
January 15th of each year, commencing on January 15, 1998, until the note is
paid in full, and (ii) the principal amount is payable in three equal
installments of $433,334 on January 15, 1998, January 15, 1999 and on the date
which is ten days following the date of the payment in full of all amounts owed
by the Company to Bank of America, N.A. under the Company's Credit Agreement
with Bank of America, N.A.; and (iii) certain additional contingent payments of
cash and common stock of TLM Holdings payable to Mr. Edelstein over a three-year
period dependent upon the achievement of certain financial and operational
goals. In 2000, Mr. Edelstein received contingent payments of $1,223,873 based
on the TMS Professional Marketing Group's 1999 financial and operational goals.
Mr. Edelsteinentered into a consulting agreement, effective May 10, 1999,
with TLM Holdings, to provide consulting services with respect to marketing and
sales activities, and to support the executive management of the TMS . The
agreement, as subsequently amended, provides for, among other things, (i) a term
through December 31, 2002, (ii) Mr. Edelstein to devote 20% of his business time
(not less than four days per month) to provide the required services, and (iii)
the payment of $75,000 annually to Mr. Edelstein.
Agreements with Ann M. Holmes
The Company, Ms. Holmes and AM Medica Communications, Ltd., which was then
owned primarily by Ms. Holmes ("AM Medica") entered into an agreement dated
October 24, 1998, ("AM Medica Agreement"), whereby the Company purchased all of
the the issued and outstanding shares of AM Medica. The purchase price for the
shares was as follows: (i) $20,000,000 in cash, (ii) the issuance by the Company
of a 6.5% subordinated promissory note in the original principal amount of
$5,500,000, as amended to decrease the principal amount to $5,219,000, payable
in the following manner: (a) consecutive monthly payments of $150,000 payable on
the first day of each month, (b) two additional payments of $250,000 each,
payable on May 25, 2000 and October 25, 2000, and (c) the remaining principal
amount and any outstanding accrued and unpaid interest thereon, payable on
October 1, 2003; and (iii) certain additional contingent payments of cash and
common stock of the Company payable to Ms. Holmes over a three-year period
dependent upon the achievement of certain financial and
20
operational goals. In 2000, Ms. Holmes received payments of $1,850,000 pursuant
to the Subordinated Promissory Note..
Additionally, effective February 14, 2001, the Company entered into a
consulting agreement with Ms. Holmes to provide consulting services and support
to AM Medica. The agreement provides for, among other things, (i) a term through
December 31, 2003, and (ii) the payment of a consulting fee of $15,000 per month
to Ms. Holmes.
Lease Agreement
PM Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary
of the Company ("PM"), has entered into a 10-year triple net lease agreement
with Phoenix Realty Partners, a New Jersey Partnership ("Phoenix Realty"), which
is comprised of Joesph Macaluso, and Douglas Rebak, a former officer of the
Company. , whereby PM is leasing an aggregate of approximately 102,000 square
feet of combined office, warehouse and mezzanine space for an aggregate base
rent of $662,860 per year during years 1 through 5 of the term, and $786,760 per
year during years 6 through 10.
21
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of May 1, 2001, by (i) each person
known by the Company to be the beneficial owner of more than five percent (5%)
of the shares outstanding of Common Stock (based on a review of filings with the
Securities and Exchange Commission); (ii) each Named Executive Officer; and
(iii) all of the Company's current directors and executive officers as a group.
The beneficial ownership of the Company's Common Stock with respect to the
directors and Mr. Dinkins appears under the caption "Proposal One - Election of
Directors" above. Unless otherwise indicated, each shareholder has sole voting
and investment power with respect to the indicated shares.
Amount and Nature of
Name and Address of Beneficial Owner Beneficial Ownership Percent of Class
- -------------------------------------------------------------------------------------------------------------
John Hamerski, Executive Vice President and 2,201(1) *
Chief Financial Officer
Joseph Macaluso, Executive Vice President of 177,264(2) 1.8%
Sales
Robert Regazzi, Senior Vice President and 30,401(3) *
Chief Operating Officer - Phoenix Marketing
Group
Bernard Tronel, Senior Vice President and 3,003(4) *
Chief Operating Officer - Teleservices Group
All directors and executive 527,367(5) 5.3%
officers as a group
(thirteen persons)
Compania Financiera Tassarina S.A. 551,130(6) 5.6%
8 Calle Aquilino de la Guardia
Panama City, Panama
__________________
* Less than one percent.
(1) Includes 701 shares of Common Stock presently issuable upon exercise of
options and 12,500 options of which 6,507 were vested which were
surrendered pursuant to a Repricing Program dated March 27, 2001.
(2) Includes1,201 shares of Common Stock presently issuable upon exercise of
options, 10,000 shares owned by Mr. Macaluso's spouse and 12,000 options of
which 6,000 were vested which were surrendered pursuant to a Repricing
Program dated March 27, 2001.
(3) Includes 401 shares of Common Stock presently issuable upon exercise of
options and 54,000 options of which 20,827 were vested which were
surrendered pursuant to a Repricing Program dated March 27, 2001.
(4) Includes 1,003 shares of Common Stock presently issuable upon exercise of
options and 14,000 options of which 4,805 were vested which were
surrendered pursuant to a Repricing Program dated March 27, 2001.
(5) Includes 75,789 shares of Common Stock presently issuable upon exercise of
options and 362,000 options of which 185,549 were vested which were
surrendered pursuant to a Repricing Program dated March 27, 2001.
22
(6) According to a Schedule 13D, dated September 17, 1999, filed by Compania
Financiera Tassarina, S.A. ("Compania"), Compania has sole voting and no
dispositive power over all 551,130 shares and Charles Henri Weil has no
voting power and sole dispositive power over all 551,130 shares.
23
PROPOSAL TWO
APPROVAL OF AN AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION TO
PROVIDE FOR CLASSIFICATION OF THE BOARD OF DIRECTORS.
General Information on the Amendment
The Board has unanimously approved and recommended that the stockholders of
the Company approve an amendment to the Company's Certificate of Incorporation.
The proposed amendment provides for the classification of the Board into three
classes of directors with staggered terms of office (the "Amendment"). A copy
of the Amendment is attached to this Proxy Statement as Appendix B.
Delaware law permits the Company to include a provision in its Certificate
of Incorporation that provides for a classified board of directors with
staggered three-year terms. Absent such a provision, Delaware law provides that
all directors serve a one-year term and until their successors are duly elected
and qualified. The Amendment provides that directors will be classified into
three classes, as nearly equal in number as possible. The initial terms of one
class will expire at the Company's 2002 annual meeting, the initial terms of the
second class will expire at the Company's 2003 annual meeting, and the initial
terms of the third class will expire at the Company's 2004 annual meeting. At
each Annual Meeting following this initial classification and election, the
successors to the class of directors whose terms expire at that meeting would be
elected for a term of office to expire at the third succeeding Annual Meeting
after their election, and until their successors have been duly elected and
qualified. Under Delaware law, directors chosen to fill vacancies on the
classified board would hold office until the next stockholders meeting at which
directors were elected, even if a new director was filling an unexpired term in
a class with more than one year remaining in its term.
If the Company's stockholders adopt the Amendment, the election procedure
described above would be implemented in connection with the elections at the
Meeting and would be applicable to every future election of directors. If the
Company's stockholders do not adopt the Amendment, six directors will be elected
to serve a one-year term until the Company's 2002 Annual Meeting of
Stockholders. The Company's Certificate of Incorporation does not authorize
cumulative voting for directors, and the Amendment would not change the
requirement that any directors standing for election must be elected by a
plurality of votes cast.
The proposal is not intended as a takeover-resistive measure in response to
a specific threat, but rather is being recommended to assure fair treatment of
the Company's stockholders in takeover situations. Although the Board may
review other possible anti-takeover programs, the Board has no present intention
of proposing additional amendments to the Certificate of Incorporation that
would affect the ability of a thirdparty to change control of the Company.
Advantages of the Amendment
The Board has observed that certain tactics, including the accumulation of
substantial stock positions as a prelude to an attempted takeover or significant
corporate restructuring, have
24
become relatively common in corporate takeover practice. The Board is of the
opinion that such tactics can be highly disruptive to a company and can result
in dissimilar treatment of a company's stockholders. The Amendment will, by
making it more time consuming and difficult for a substantial stockholder or
stockholders to gain control of the Board without its consent, ensure some
continuity in the management of the business and affairs of the Company and
provide the Board with sufficient time to review both takeover proposals and
appropriate alternatives. The Board also believes that the Amendment will serve
to encourage any person intending to attempt a takeover to negotiate in advance
with the Board, which in turn would allow the Board to protect better the
interests of the Company's stockholders.
Disadvantages of the Amendment
Stockholders should be aware that the proposed classified board will extend
the time required to effect a change in control of the Board and may discourage
hostile takeover bids for the Company, even if such a bid might be deemed by
stockholders to be in their best interests. If the Company's stockholders
approve the Amendment, it will take at least two annual meetings for a majority
of stockholders to effectuate a change in control of the Board. Currently, a
majority of stockholders could effectuate a change in control of the Board at
one stockholder meeting. Because of the additional time required to change
control of the Board, and the limitation on the removal of directors, the
Amendment will tend to perpetuate present management. The Board also believes
that the Amendment (i) will significantly reduce the possibility that a third
party could effect a sudden or surprise change in majority control of the Board
without the support of the incumbent Board, and (ii) will have significant
effects on the ability of the Company's stockholders to cause immediate changes
in the composition of the Board and otherwise to exercise their voting power to
affect the composition of the Board.
In addition, since the Amendment is designed to discourage accumulations of
large blocks of Common Stock by purchasers whose objective is to have such stock
repurchased by the Company at a premium, adoption of the Amendment could tend to
reduce any temporary fluctuations in the market price of the Common Stock that
are caused by such accumulations. Accordingly, stockholders could be deprived
of certain opportunities to sell their stock at a higher market price. Because
the Amendment will increase the amount of time required for a takeover bidder to
obtain control of the Company without the cooperation of the Board, even if the
takeover bidder were to acquire a majority of the Company's outstanding stock, a
classified board may tend to discourage certain tender offers that would
otherwise allow stockholders the opportunity to realize a premium over the
market price of their stock. The Amendment will also make it more difficult for
the Company's stockholders to change the composition of the Board even if the
stockholders believe such a change would be desirable based on the performance
of directors and the Company.
The Board of Directors is not generally aware of any pending or proposed
takeover or change in control of the Company.
Vote Required to Approve Amendments
Under Delaware law, any amendment to a company's certificate of
incorporation must be approved by a majority of the outstanding stock entitled
to vote thereon. As a result, the
25
affirmative vote of a majority of the outstanding shares of Common Stock is
required to approve the Amendment. Abstentions and broker non-votes will not be
considered a vote for the Amendment.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE PROPOSED AMENDMENT TO THE
COMPANY'S CERTIFICATE OF INCORPORATION TO CREATE A CLASSIFIED BOARD OF DIRECTORS
WITH STAGGERED THREE-YEAR TERMS BE APPROVED.
It is the intention of the persons named in the accompanying form of proxy
to vote the shares represented thereby in favor of the proposed amendment to the
Company's Certificate of Incorporation unless otherwise instructed in such
proxy.
PROPOSAL THREE
RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Board of Directors of the Company has selected PricewaterhouseCoopers
LLP to serve as independent accountants for the Company for the fiscal year
ending December 31, 2001. Such firm has examined the financial statements of the
Company since prior to the Company's initial public offering on February 13,
1998.
Although it is not required to do so, the Board of Directors is submitting
its selection of the Company's accountants for ratification at the Meeting in
order to ascertain the views of stockholders regarding such selection. If the
selection is not ratified, the Board of Directors will reconsider its selection.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE FOR
RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP TO EXAMINE THE
CONSOLIDATED FINANCIAL STATEMENTS OF THE COMPANY AND ITS SUBSIDIARIES FOR THE
FISCAL YEAR ENDING DECEMBER 31, 2001.
It is the intention of the persons named in the accompanying form of proxy
to vote the shares represented thereby in favor of such ratification unless
otherwise instructed in such proxy.
A representative of PricewaterhouseCoopers LLP will be present at the
Meeting and will have the opportunity to make a statement if such representative
desires to do so, and will be available to respond to appropriate questions.
OTHER MATTERS
The Board of Directors does not know of any other matters which may be
brought before the Meeting. However, if any such other matters are properly
presented for action, it is the intention of the persons named in the
accompanying form of proxy to vote the shares represented thereby in accordance
with their judgment on such matters.
26
SOLICITATION OF PROXY
The proxy accompanying this Proxy Statement is being solicited on behalf of
the Company's Board of Directors. Officers, directors and certain employees of
the Company, none of whom will receive any additional compensation for their
services, may solicit proxies. Also, the Company has retained Morrow and
Company, Inc., a proxy solicitation firm, to solicit proxies at an estimated
cost of $20,000 plus reasonable expenses. Such solicitations may be made
personally, or by mail, facsimile, telephone, telegraph, messenger, or via the
Internet. The Company will pay persons holding shares of Common Stock in their
names or in the name of nominees, but not owning such shares beneficially, such
as brokerage houses, banks, and other fiduciaries, for the expense of forwarding
solicitation materials to their principals. The Company will pay all of the
cost of solicitation of proxies.
MISCELLANEOUS
It is important that proxies be returned promptly. Whether or not you
expect to attend the meeting in person, the Board of Directors urge you to mark,
sign and date the accompanying form of proxy and mail it in the enclosed return
envelope, which requires no postage if mailed in the United States, so that your
votes can be recorded.
STOCKHOLDER PROPOSALS
The deadline for submission of stockholder proposals pursuant to Rule 14a-8
of the Exchange Act for inclusion in our proxy statement for the 2002 annual
meeting of stockholders is January 5, 2002. Additionally, the Company must
receive notice of any stockholder proposal to be submitted at the 2002 annual
meeting of stockholders (but not required to be included in our proxy statement)
by March 21, 2002, or such proposal will be considered untimely pursuant to Rule
14a-4 and 14a-5(e) under the Exchange Act and the persons named in the proxies
solicited by management may exercise discretionary voting authority with respect
to such proposal.
ANNUAL REPORT ON FORM 10-K
A copy of the Company's Annual Report on Form 10-K, including the financial
statements for the fiscal year ended December 31, 2000, which has been filed
with the Securities and Exchange Commission, is included in the Annual Report
accompanying this Proxy Statement.
May 5, 2001
27
Appendix A
----------
AUDIT COMMITTEE CHARTER
-----------------------
Statement of General Policy
---------------------------
The primary purpose of the Audit Committee (the "Committee") is to assist the
Board of Directors (the "Board") in fulfilling its responsibilities to oversee
management activities related to internal control, accounting and financial
reporting policies and auditing practices; to review the independence of the
outside auditors and the objectivity of the internal auditors and to review the
adequacy and reliability of disclosures to stockholders.
The members of the Committee shall meet the independence and experience
requirements of the National Association of Securities Dealers. The Committee
shall comprise of a minimum of three members all of which are appointed by the
Board on the recommendation of the Nominating Committee.
The Committee will meet at least twice a year with the Chief Financial Officer,
the Director of Internal Audit and the outside auditors in separate executive
sessions. The outside auditors are ultimately accountable to the Board and the
Committee.
The Committee recognizes that management, internal auditors, and the outside
auditors have more time, knowledge and detailed information on the Company than
do Committee members. Consequently, in carrying out its oversight
responsibilities, the Committee is not providing any expert or special
assurances as to the Company's financial statements, internal controls or any
professional certification as to the outside auditors' work.
In carrying out its oversight role, the Committee shall have the authority to
retain special legal, accounting or other consultants at its discretion and at
the Company's expense without permission of the Board or management.
The Committee is responsible for conducting the following recurring activities:
1. Review and reassess the adequacy of the Charter annually. At any time, the
Committee may recommend amendments to this charter and submit amendments
for Board approval.
2. Review and discuss the annual audited and quarterly unaudited financial
statements with management and the outside auditors. Discuss with the
outside auditors their judgment about the quality, not just the
acceptability, of the Company's accounting principles as applied to its
financial reporting as required by SAS 61, as modified or supplemented.
3. Recommend to the Board whether to include the audited financial statements
in the Company's Form 10-K.
4. Review the report required by the Securities and Exchange Commission to be
included in the Company's annual proxy statement.
5. Review significant changes in the Company's policies related to risk
management, internal controls, accounting and financial reporting and
ethical behavior of employees.
6. Review internal reports to remain appraised of material financial exposures
and management actions to address issues related to:
. Internal audit activities and internal and outside auditors'
evaluation of internal control;
. Exposures, uninsured risks, insurance coverages and premiums;
. Compliance with Company policies, including the Code of Ethics and
Business Conduct, and with federal and state laws;
. Legal actions brought against the Company and any liabilities and
contingencies, which would jeopardize its financial condition.
7. Select and evaluate the outside auditors' performance and where
appropriate, replace the outside auditors subject to approval by the Board
and ratified by the stockholders; and review the appointment and
replacement of the Director of Internal Audit.
8. Confirm annually the outside auditors independence from the Company.
9. Review with the outside auditors' the scope of their examination for the
succeeding year subsequent to the close of the current year.
10. Approve fees charged by the outside auditors.
11. Report minutes of the Audit Committee meetings to the full Board.
12. Review the Company's activities with respect to minimizing any adverse
environmental impact of its operations, products and product packaging.
Appendix B
----------
AMENDMENT TO ARTICLE V OF THE COMPANY'S
---------------------------------------
CERTIFICATE OF INCORPORATION
----------------------------
Section 1. Number of Directors. The number of directors of this Corporation
shall be not less than three (3). The exact number of directors shall be fixed
from time to time by, or in the manner provided in, the By-Laws of the
Corporation, and may be increased or decreased as therein provided.
Section 2. Number and Classification of Directors. The directors shall be
divided into three classes, designated Class I, Class II and Class III. Each
class shall consist, as nearly as possible, of one-third of the total number of
directors constituting the entire Board of Directors. The term of the initial
Class I directors shall terminate on the date of the 2002 Annual Meeting of
stockholders; the term of the initial Class II directors shall terminate on the
date of the 2003 Annual Meeting of stockholders; and the term of the initial
Class III directors shall terminate on the date of the 2004 Annual Meeting of
stockholders. At each meeting of stockholders beginning in 2002, successors to
the class of directors whose term expires at that Annual Meeting shall be
elected for a three-year term. If the number of directors is changed, any
increase or decrease in directorships shall be apportioned among the classes so
as to maintain the number of directors in each class as nearly equal as
possible, and any additional directors of any class elected to fill a vacancy
resulting from an increase in such class shall hold office until the next
election of directors of such class by the stockholders, but in no case will a
decrease in the number of directors shorten the term of any incumbent director.
Directors shall hold office until the annual meeting for the year in which their
terms expire and until their successors shall be elected and shall qualify,
subject, however, to prior death, resignation, retirement, disqualification or
removal from office. Any vacancy on the Board of Directors, howsoever
resulting, may be filled by the affirmative vote of a majority of the remaining
directors then in office, even if less than a quorum. Any director elected to
fill a vacancy shall hold office until the next election of directors of such
class by the stockholders.
________________________________
WHEN PROXY IS OKAYED PLEASE SIGN
& DATE IT ABOVE
- -------------------------------------------------------------------------------
ACCESS WORLDWIDE COMMUNICATIONS, INC.
Proxy - Annual Meeting of Stockholders - June 20, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned, a stockholder of ACCESS WORLDWIDE COMMUNICATIONS, INC., does
hereby appoint Michael Dinkins and Richard Lyew, or either of them, with full
power of substitution, the undersigned's proxies, to appear and vote at the
Annual Meeting of Stockholders to be held June 20, 2001, at 11:00 a.m., local
time, or at any adjournments thereof, upon such matters as may properly come
before the Meeting.
(Continued and to be Completed on Reverse Side.)
- -------------------------------------------------------------------------------
ACCESS WORLDWIDE COMMUNICATIONS, INC.
Annual Meeting of Stockholders
June 20, 2001
Please mark, your, date and return the
proxy card promptly using the enclosed envelope.
| Please Detach and Mail in the Envelope Provided |
- -------------------------------------------------------------------------------
A [X]Please mark your
votes as in this
example.
WITHHOLD
AUTHORITY
to vote for
FOR nominees listed
Nominees: CLASS I
1. Election of [ ] [ ] -------
Directors. Peter D. Bewley
Lee H. Edelstein
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE CLASS II
FOR AN INDIVIDUAL NOMINEE, WRITE THAT --------
NOMINEES NAME IN THE SPACE PROVIDED BELOW.) Randall J. Lewis
Shawkat Raslan
CLASS III
---------
Michael Dinkins
Liam S. Donohue
2. Approve an Amendment to the Restated Certificate of Incorporation to provide
for the classification of the Board of Directors.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
3. Ratification of appointment of PricewaterhouseCoopers LLP as independent
accountants for the fiscal year ending December 31, 2001.
[ ] [ ] [ ]
The Board of Directors recommends a vote "FOR" each Item.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS INDICATED. IF NO DIRECTION
IS INDICATED, SUCH SHARES WILL BE VOTED IN FAVOR OF THE ITEM(S) FOR WHICH NO
DIRECTION IS INDICATED AND AT THE DISCRETION OF THE PERSON NAMED IN THIS PROXY
AS TO OTHER MATTERS THAT MAY PROPERLY COME BEFORE THIS MEETING.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
Stockholder(s) Sign Here _________________ (L.S.) _____________ Dated _______
NOTE: Please sign exactly as your name appears on this proxy. If your stock is
jointly owned, both partner must sign. Fiduclanes and corporate and other
represantatives should to indicate when signing and when more than one named a
majority should sign.