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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
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(3)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
STIFEL FINANCIAL CORP.
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a 6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transactions applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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STIFEL FINANCIAL CORP.
500 NORTH BROADWAY
ST. LOUIS, MISSOURI 63102-2188
(314) 342-2000
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD TUESDAY, APRIL 23, 1996
To the Holders of the Common Stock of
Stifel Financial Corp.
The Annual Meeting of Stockholders of Stifel Financial Corp., a Delaware
corporation (the "Company"), will be held in the Crystal Room, 3rd Floor,
Missouri Athletic Club, 405 Washington Avenue, St. Louis, Missouri, on Tuesday,
April 23, 1996 at 10:00 a.m., for the following purposes:
1. To elect two (2) members of the Board of Directors;
2. To ratify the appointment of Coopers & Lybrand L.L.P. as
independent accountants for the year ending December 31,
1996; and
3. To consider and act upon such other business as may
properly come before the meeting and any adjournment
thereof.
The Company's Board of Directors has fixed the close of business on
March 12, 1996 as the record date for the determination of stockholders
entitled to receive notice of and to vote at the meeting and any adjournment
thereof.
By Order of the Board of Directors.
Charles R. Hartman, Assistant Secretary
March 22, 1996
St. Louis, Missouri
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND SIGN
THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE IN ORDER TO
ASSURE REPRESENTATION OF YOUR SHARES. NO POSTAGE NEED BE AFFIXED IF MAILED IN
THE UNITED STATES.
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STIFEL FINANCIAL CORP.
500 NORTH BROADWAY
ST. LOUIS, MISSOURI 63102-2188
(314) 342-2000
PROXY STATEMENT
For Annual Meeting of Stockholders to be
Held on Tuesday, April 23, 1996
Approximate Date of Mailing: March 22, 1996
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Stifel Financial Corp., a Delaware
corporation (the "Company"), for use at the Annual Meeting of Stockholders to
be held on Tuesday, April 23, 1996 at 10:00 a.m. in the Crystal Room, 3rd
Floor, Missouri Athletic Club, 405 Washington Avenue, St. Louis, Missouri, and
any adjournment thereof, for the purposes set forth in the accompanying Notice
of Annual Meeting of Stockholders.
All proxies will be voted in accordance with the instructions contained in
the proxy. If no choice is specified, proxies will be voted in favor of the
election of the nominees for director proposed by the Board of Directors in
Proposal I, and in favor of the ratification of the appointment of Coopers &
Lybrand L.L.P. as the Company's independent accountants for the year ending
December 31, 1996, as recommended by the Board of Directors. A stockholder who
executes a proxy may revoke it at any time before it is exercised by delivering
to the Company another proxy bearing a later date, by submitting written notice
of such revocation to the Assistant Secretary of the Company or by personally
appearing at the Annual Meeting and casting a contrary vote.
A plurality of the votes cast is required for the election of directors.
Under the General Corporation Law of the State of Delaware, an abstaining vote
is not deemed to be a "vote cast." As a result, abstentions and broker
"non-votes" are not included in the tabulation of the voting results on the
election of directors and, therefore, do not have the effect of votes in
opposition. The ratification of the appointment of Coopers & Lybrand L.L.P. as
the Company's independent accountants requires the affirmative vote of a
majority of the shares represented at the meeting and entitled to vote.
Abstentions on such matter will be counted for the purpose of determining the
number of shares represented by proxy at the meeting for such matter, and shall
therefore have the same effect as if such shares were voted against such
ratification. Broker "non-votes" will be treated as not represented at the
meeting as to the ratification of Coopers & Lybrand L.L.P. for purposes of
determining the number of votes needed for approval.
A broker "non-vote" occurs when a nominee holding shares for a beneficial
owner does not vote a particular proposal because the nominee does not have
discretionary voting power with respect to that item and has not received
instructions from the beneficial owner. Broker "non-votes" and the shares as to
which stockholders abstain are included for purposes of determining whether a
quorum of shares is present at a meeting.
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VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The close of business on March 12, 1996 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
Annual Meeting. Each outstanding share of the Company's common stock, $0.15 par
value ("Common Stock"), is entitled to one vote. On March 12, 1996, there were
outstanding and entitled to vote 4,476,491 shares of the Common Stock.
Ownership of Directors, Nominees and Executive Officers
The following table sets forth information regarding the amount of the
Common Stock beneficially owned, as of March 12, 1996, by each director of the
Company, each nominee for election as a director of the Company, the executive
officers named in the Summary Compensation Table and all directors and
executive officers of the Company as a group:
Name Beneficially Owned (1) Class (1)
- ----------------------------------- ---------------------- ------------------
George H. Walker III............... 410,030 (2)(3) 9.10%
Gregory F. Taylor.................. 76,256 (2)(4) 1.70%
James D. Sumption.................. 32,035 (2)(5) (7)
John J. Goebel..................... 17,016 (2)(3) (7)
Rick E. Maples..................... 14,194 (2) (7)
Lawrence E. Somraty................ 10,960 (2) (7)
Charles R. Hartman................. 7,338 (2)(6) (7)
Belle A. Cori...................... 7,292 (2) (7)
Richard F. Ford.................... 7,292 (2) (7)
Robert E. Lefton................... 6,977 (2) (7)
Charles A. Dill.................... 5,250 (2) (7)
Directors and Executive Officers
as a Group (18 persons).......... 693,751 (1)(2) 15.01%
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(1) Shares issuable upon exercise of options included herein were deemed to be
outstanding for purposes of calculating the percentage of outstanding
shares for each person holding such options but were not deemed to be
outstanding for the purpose of calculating the percentage of outstanding
shares for any other person.
(2) Includes the following shares which such persons and group have the right
to acquire within the 60 days after March 12, 1996 upon the exercise of
stock options: Mr. Walker -- 30,384, Mr. Sumption -- 14,581, Mr. Taylor --
13,448, Mr. Goebel -- 6,077, Ms. Cori -- 6,077, Mr. Ford -- 6,077, Mr.
Somraty -- 5,992, Mr. Lefton -- 5,788, Mr. Dill -- 5,250, Mr. Hartman --
4,135, Mr. Maples -- 3,891, and directors and executive officers as a group
-- 144,962 and also includes the following shares allocated to such persons
and group under the Stifel, Nicolaus Stock Ownership Plan and Trust:
Mr. Walker -- 4,706, Mr. Somraty --3,753, Mr. Maples -- 679, Mr. Taylor --
630, Mr. Sumption -- 525, and directors and executive officers as a group
-- 16,543.
(3) Includes 9,724 shares held by the George Herbert Walker Foundation as to
which Messrs. Goebel and Walker, as trustees, share voting power.
(4) Excludes 1,457 shares owned separately by Mr. Taylor's wife and children;
Mr. Taylor disclaims beneficial ownership of such shares.
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(5) Includes 4,800 shares of Common Stock awarded to Mr. Sumption which he
holds subject to restrictions which will lapse on July 31, 1996 and
July 31, 1997, provided that he remains in the employ of the Company.
(6) Excludes 2,100 shares owned by Mr. Hartman's wife. Mr. Hartman disclaims
beneficial ownership of such shares.
(7) Shares beneficially owned do not exceed one percent of the outstanding
shares of Common Stock.
Ownership of Certain Beneficial Owners
On March 12, 1996, the following persons were the only persons known to the
Company to be beneficial owners of more than five percent (5%) of the Common
Stock:
Shares Beneficially Owned
Name and Address as of March 12, 1996 Percent
- ------------------------------------------- ------------------------- -------
AEGON USA, Inc............................. 1,350,275 (1) 23.17%
4333 Edgewood Road N.E.
Cedar Rapids, Iowa 52499
Heartland Advisors, Inc.................... 619,369 (2) 13.84%
790 North Milwaukee Street
Milwaukee, Wisconsin 53202
George H. Walker III....................... 410,030 (3) 9.10%
500 North Broadway
St. Louis, Missouri 63102
Scattered Corp............................. 409,185 (4) 9.14%
640 North LaSalle Street, Suite 300
Chicago, Illinois 60610
John Latshaw............................... 334,145 (5) 7.46%
3 Dunford Circle
Kansas City, Missouri 64113
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(1) Five subsidiaries of AEGON USA, Inc. are the holders of $10,000,000
aggregate principal amount of the Company's 11.25% Senior Convertible Notes
Due September 1, 2000 (the "Notes"). The shares shown are the shares
issuable upon conversion of the Notes which are convertible into shares of
Common Stock at any time prior to maturity. The conversion price is
subject to adjustment in certain events and is currently $7.41 per share.
Such shares are not currently outstanding but were deemed to be outstanding
for purposes of calculating the percentage of outstanding shares held by
AEGON USA, Inc.
(2) The information shown is based on a Schedule 13G, dated February 9, 1996 of
Heartland Advisors, Inc. The number of shares reflected on the Schedule
13G as of December 31, 1995, has been adjusted to reflect the five percent
stock dividend distributed by the Company on February 20, 1996. This
Schedule 13G indicates that Heartland Advisors, Inc. is an investment
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adviser registered under Section 203 of the Investment Advisers Act of 1940
and has the sole power to vote or direct the vote 396,874 of the shares,
and has the sole power to dispose of or to direct the disposition of all of
the shares.
(3) See notes 1, 2 and 3 to the preceding table.
(4) The information shown is based on an Amendment No. 4 to a Schedule 13D,
dated January 19, 1996 of Scattered Corp. The number of shares reflected
on Amendment No. 4 to the Schedule 13D has been adjusted to reflect the
stock dividend distributed by the Company on February 20, 1996. This
Schedule 13D indicates that Scattered Corp. is a broker-dealer incorporated
in the State of Illinois and has the sole power to vote or direct the vote
of the shares.
(5) The information shown is based on Amendment No. 4 to the Schedule 13D,
dated August 11, 1995 of Mr. Latshaw and Latshaw Enterprises, Inc.
("Laten"), a Delaware corporation of which Mr. Latshaw is Chairman of the
Board and Chief Executive Officer. The number of shares reflected on
Amendment No. 4 to the Schedule 13D has been adjusted to reflect the stock
dividend distributed by the Company on February 20, 1996. Amendment No. 4
to the Schedule 13D indicates Mr. Latshaw is the beneficial owner of 69.2%
of Laten's shares.The information in such Schedule 13D indicates that
Mr. Latshaw has the sole power to vote, or to direct the vote, and the sole
power to dispose of, or to direct the disposition of, the shares owned by
him, and shares with Laten the power to vote, or to direct the vote, and
the power to dispose of, or direct the disposition of, the shares owned by
Laten.
PROPOSAL I: ELECTION OF DIRECTORS
In accordance with the by-laws of the Company, the Board of Directors has
fixed the number of directors at seven directors, divided into three classes of
three, two and two directors, with the terms of office of each class ending in
successive years. The Board of Directors has nominated Belle A. Cori and
Gregory F. Taylor for election as directors to hold office until the 1999
Annual Meeting of Stockholders and until their respective successors are
elected and qualified in the class to which such director is assigned or until
their earlier death, resignation or removal. James M. Oates, whose term as a
director was to end at the 1998 Annual Meeting, resigned as a member of the
Board of Directors of the Company as of October 31, 1995. Proxies cannot be
voted for more than two nominees.
Shares represented by your proxy will be voted in accordance with your
direction as to the election as directors of the persons listed below as
nominees. In the absence of direction, the shares represented by your proxy
will be voted FOR such election. In the event any of the persons listed as
nominees becomes unavailable as a candidate for election, it is intended that
the shares represented by your proxy will be voted for the balance of those
named.
Certain information with respect to each of the nominees and each of the
continuing directors is set forth below, including any positions they hold with
the Company and its principal subsidiary, Stifel, Nicolaus & Company,
Incorporated ("Stifel, Nicolaus").
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Served as
Director
Positions or Offices Continuously
Name Age with the Company and Stifel, Nicolaus Since
- ---------------------------------- --- ------------------------------------- ------------
NOMINEES FOR TERMS ENDING IN 1999
Belle A. Cori 58 None 1990
Gregory F. Taylor 46 President and Chief Executive Officer 1988
of the Company and Stifel, Nicolaus
DIRECTORS WITH TERMS ENDING IN 1997
Charles A. Dill 56 None 1995
Richard F. Ford 59 None 1984
John J. Goebel 66 None 1987
DIRECTORS WITH TERMS ENDING IN 1998
Robert E. Lefton 64 None 1992
George H. Walker III 65 Chairman of the Board of the Company 1981
and Stifel, Nicolaus
The following are brief summaries of the business experience during the
past five years of each of the nominees for election as a director of the
Company and the other directors whose terms of office as directors will
continue after the Annual Meeting, including, where applicable, information as
to the other directorships held by each of them.
Nominees
Belle A. Cori has been Chairman of Eau Claire Mattress Manufacturing
Corporation, a mattress manufacturer, since 1990 and, prior thereto, she was
President of such corporation. Ms. Cori was a Vice President and Manager of the
Business Service Department of Boatmen's Trust Company from 1980 until 1986 and
she was Vice President, Investment and Trust Planning, of Boatmen's Trust
Company from 1986 to 1989.
Gregory F. Taylor was branch manager of Stifel, Nicolaus' Chicago branch
from October, 1985 until July, 1988. He became Executive Vice President and
Director of National Sales and Marketing of Stifel, Nicolaus in July, 1988,
Chief Operating Officer in November, 1991 and President and Chief Executive
Officer as of October 26, 1992. He was elected a Vice President of the Company
in October, 1991 and President and Chief Executive Officer as of October 26,
1992.
The Board of Directors recommends a vote FOR the election of each of the
nominees for director of the Company.
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Continuing Directors
Charles A. Dill has been a General Partner of Gateway Equity Partners IV,
since November, 1995. From 1991 to 1995, Mr. Dill had been the President,
Chief Executive Officer and a director of Bridge Information Systems, Inc., a
company providing online information and trading services. From 1988 to 1990
Mr. Dill was President and Chief Operating Officer of AVX Corporation; prior
thereto, he was a senior vice president with Emerson Electric Co. Mr. Dill is
a director of ZOLTEK, Inc.
Richard F. Ford is a Managing General Partner of the management companies
which act as a General Partner of Gateway Mid-America Partners, L.P., Gateway
Venture Partners II, L.P., Gateway Venture Partners III, L.P., and Gateway
Partners, L.P., private venture capital funds formed in 1984, 1987, 1990 and
1994, respectively. Mr. Ford is a director of CompuCom Systems, Inc. and D&K
Wholesale Drug.
John J. Goebel has been a partner in the law firm of Bryan Cave LLP since
1966 and has been associated with that firm since 1956.
Robert E. Lefton, Ph.D. has been President and Chief Executive Officer of
Psychological Associates, Inc., an international training and consulting firm,
since 1958. Dr. Lefton is a director of Allied Healthcare Products, Inc.,
Greenfield Industries, and Wave Technology.
George H. Walker III joined Stifel, Nicolaus in 1976, became President and
Chief Executive Officer of Stifel, Nicolaus in December, 1978, and became
Chairman of Stifel, Nicolaus in July, 1982. From the time of the organization
of the Company in 1981 Mr. Walker has served as its Chairman of the Board and,
until October 26, 1992, Mr. Walker served as its President and Chief Executive
Officer. Mr. Walker is a director of Laclede Steel Company, Laidlaw Corp. and
EAC Corporation. He is active in various community activities and is a former
Chairman of Downtown St. Louis, Inc. and Webster University. He currently is
Chairman of the Missouri Historical Society and Chairman of the Advisory
Committee of Webster University Business School.
Board of Directors and Committees
During the year ended December 31, 1995, the Board of Directors of the
Company met five times, including both regularly scheduled and special
meetings. During such year all of the incumbent directors attended at least 75%
of all meetings held by the Board of Directors and all committees on which they
serve.
The standing committees of the Board of Directors are the Executive
Committee, Audit Committee, Compensation Committee, Finance Committee and
Nominating Committee.
Executive Committee. Messrs. Walker (Chairman), Taylor and Goebel are the
current members of the Executive Committee, and Mr. Oates served on the
committee until his resignation on October 31, 1995. Except to the extent
limited by law, the Executive Committee has all the authority of the Board of
Directors. The Executive Committee did not meet during the year ended
December 31, 1995.
Audit Committee. Messrs. Dill (Chairman), Ford and Goebel are the current
members of the Audit Committee. (Mr. Oates was the former Chairman.) The
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functions of the Audit Committee are to monitor and assess the adequacy of
systems and procedures for providing reliable financial statements of the
Company and its subsidiaries, as well as suitable internal financial controls,
to review and approve the scope and performance of the independent external and
internal auditors' work, and to make such recommendations as it deems necessary
to the Board of Directors regarding the Company's financial statements,
financial controls and related matters. The Audit Committee met four times
during the year ended December 31, 1995.
Compensation Committee. Mr. Lefton (Chairman) and Ms. Cori are members of
the Compensation Committee. The functions of the Compensation Committee are to
recommend salary and bonus levels for the senior officers of the Company and
its subsidiaries and to administer the Company's employee stock plans. The
Compensation Committee met five times during the year ended December 31, 1995.
Finance Committee. Messrs. Ford (Chairman), Dill and Lefton and Ms. Cori
are the current members of the Finance Committee, and Mr. Oates served on the
committee until his resignation on October 31, 1995. The functions of the
Finance Committee are to review and monitor the consolidated financial
condition of the Company. The Finance Committee met five times during the year
ended December 31, 1995.
Nominating Committee. Messrs. Walker (Chairman), Lefton and Goebel are the
current members of the Nominating Committee, and Mr. Oates served on the
committee until his resignation on October 31, 1995. The function of the
Nominating Committee is to identify, evaluate and select potential director
nominees. The Nominating Committee did not meet during the year ended
December 31, 1995.
Compensation of Directors. Non-employee directors are paid annual
compensation at a rate of $15,000 for attendance at Board of Directors meetings
and $250 for attendance at Committee meetings and are reimbursed for expenses
incurred in attending such meetings. In addition, Mr. Oates received $3,200 for
special committee work during the year of 1995. Directors who are employees do
not receive any compensation for service as directors, but the Company pays
their expenses for attendance at Board meetings.
EXECUTIVE COMPENSATION
For the years ended December 31, 1995 and December 31, 1994, the five-month
transition period from July 30, 1993 to December 31, 1993 ("Transition
Period"), and the fiscal year ended July 30, 1993 the following table presents
summary information concerning compensation awarded or paid to, or earned by,
the Chief Executive Officer and each of the other four most highly compensated
executive officers for the year ended December 31, 1995 for services rendered
to the Company and it subsidiaries.
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SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
------------------------- ----------------------
Other Annual Restricted All Other
Compensation Stock Options Compensation
Name and Principal Position Year Salary ($) Bonus ($)<F1> ($)<F2> Awards ($) SARS (#) ($)
- --------------------------- ----- ---------- ------------- ------------ ------------ -------- ------------
Gregory F. Taylor(3) 1995 186,458 -0- -- -0- -0- 1,113 <F4>
President and Chief 1994 175,000 -0- -- -0- -0- 1,110 <F5>
Executive Officer of the 1993T 72,917 58,000 50,314 -0- -0- 1,469 <F6>
Company and Stifel, 1993 175,000 274,400 27,150 -0- -0- 4,162 <F7>
Nicolaus
Rick E. Maples 1995 140,000 811,381 -- -0- -0- 8,288 <F4>
Senior Vice President of 1994 140,000 98,048 -- -0- -0- 8,285 <F5>
Stifel, Nicolaus 1993T 55,833 203,227 -- -0- -0- 1,469 <F6>
1993 121,667 467,996 -- 33,125 <F8> -0- 11,890 <F7>
Charles R. Hartman <F9> 1995 150,000 150,000 -- -0- -0- 41,258 <F4>
Senior Vice President 1994 82,991 81,250 -- -0- 15,750 36,276 <F5>
of Stifel, Nicolaus 1993T -- -- -- -- -- --
1993 -- -- -- -- -- --
James D. Sumption 1995 250,000 22,500 -- -- -- 250 <F4>
President of 1994 250,000 10,000 -- -- -- 250 <F5>
Pin Oak Capital, Ltd. 1993T 104,167 11,677 -- -- -- 634 <F6>
1993 250,000 61,147 -- 82,500 <F10> -- 3,557 <F7>
Lawrence E. Somraty 1995 124,583 61,466 -- -- -- 250 <F4>
Chief Executive Officer 1994 83,750 52,756 -- -- -- 250 <F5>
of Century Securities 1993T 32,813 13,070 -- -- -- 355 <F6>
Associates, Inc. 1993 78,438 34,758 -- -- -- 2,258 <F7>
- ---------------
<FN>
(1) Represents bonuses paid under the executive compensation plans described in the Compensation Committee Report
on Executive Compensation set forth elsewhere in this Proxy Statement.
(2) The named executive officers received certain perquisites in 1995, 1994, the Transition Period and fiscal 1993,
the amount of which did not exceed the lesser of $50,000 or 10% of any such officer's salary and bonus. The
amounts reflected for Mr. Taylor represent tax reimbursement payments in connection with restricted stock
awards granted prior to fiscal 1992.
(3) Mr. Taylor has served as President and Chief Executive Officer of the Company and Stifel, Nicolaus since
October 1992; prior thereto (including the portion of fiscal 1993 prior to October 1992) he served as Vice
President of the Company and Executive Vice President and Chief Operating Officer of Stifel, Nicolaus.
(4) The Company contributed $250 to the Profit Sharing Plan for each named executive officer and $863 to the
Employee Stock Purchase Plan for Messrs. Taylor, Maples and Hartman. The Company paid $20,493 in moving
expenses and forgave a loan amount of $19,652 (principal and interest) for Mr. Hartman. The Company paid a
premium of $7,175 on behalf of Mr. Maples for a life insurance policy.
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(5) The Company contributed $250 to the Profit Sharing Plan for each of Messrs. Taylor, Maples, Sumption and
Somraty and $860 to the Employee Stock Purchase Plan for each of Messrs. Taylor and Maples. The Company paid
$36,276 in moving expenses for Mr. Hartman. The Company paid a premium of $7,175 on behalf of Mr. Maples for a
life insurance policy.
(6) The Company contributed $117 to the Profit Sharing Plan for each of Messrs. Taylor, Maples, Sumption and
Somraty. Contributions by the Company to the Employee Stock Ownership Plan were made as follows: Mr. Taylor
($724), Mr. Maples ($724), Mr. Sumption ($517) and Mr. Somraty ($238). The Company contributed $628 each for
Messrs. Taylor and Maples toward the purchase of the Company's common stock under the Employee Stock Purchase
Plan.
(7) The Company contributed $2,171 to the Employee Stock Ownership Plan for each of the named executive officers,
except that the Company contributed $1,015 for Mr. Somraty. Contributions by the Company to the Profit Sharing
Plan were as follows: Mr. Taylor ($1,206), Mr. Maples ($1,759), Mr. Sumption ($1,386) and Mr. Somraty ($1,243).
The Company contributed $785 for each of Messrs. Taylor and Maples towards the purchase of the Company's common
stock under the Employee Stock Purchase Plan. The Company paid a premium of $7,175 on behalf of Mr. Maples for
a life insurance policy.
(8) On October 7, 1992, Mr. Maples was granted 5,000 shares of restricted stock, at which time the closing price of
the Company's Common Stock was $6.625 per share. As of the end of 1995, the aggregate stock holdings of Mr.
Maples consisted of 5,000 shares worth $31,550 at the then current market value. The amount reported in the
Table represents the market value of the shares at the date of grant ($6.625 per share) determined without
giving effect to the diminution of value attributable to the restrictions on such stock at the time of grant.
The restrictions on Mr. Maples' restricted stock lapsed on August 31, 1993, 1994 and 1995.
(9) Mr. Hartman has served as General Counsel to Stifel, Nicolaus since June, 1994; prior thereto he was not
employed by the Company or Stifel, Nicolaus.
(10) On August 1, 1992, Mr. Sumption was granted 12,000 shares of restricted stock, at which time the closing price
of the Company's Common Stock was $6.875 per share. As of the end of 1995, the aggregate restricted stock
holdings of Mr. Sumption consisted of 12,000 shares worth $79,500 at the then current market value, without
giving effect to the diminution of value attributable to the restrictions on such stock. The restrictions of
Mr. Sumption's restricted stock lapsed in the amount of 2,400 shares on each of July 31, 1993, 1994 and 1995,
respectively, and restrictions on the remaining shares will lapse on July 31 of 1996 and 1997 in the amounts of
2,400 and 2,400 shares, respectively. Mr. Sumption is entitled to receive dividends on the restricted shares.
The following presents certain information concerning stock options granted
to the named executive officers during the year ended December 31, 1995, and
year-end stock option values. No stock options were exercised by the named
executive officers during the year ended December 31, 1995.
OPTION GRANTS IN LAST YEAR
No stock option grants were made to the named executive officers during the
year ended December 31, 1995.
13
YEAR-END OPTION VALUE
Total Number of Shares for
which Unexercised Options Total Value of Unexercised,
held at In-the-Money Options held at
No. of Shares December 31, 1995 December 31, 1995 <F1>
Acquired on ------------------------------ ------------------------------
Name Exercise Value Realized Exercisable Unexercisable Exercisable Unexercisable
- ------------------- -------------- -------------- -------------- -------------- -------------- --------------
Gregory F. Taylor 0 $0 13,448 0 $11,232 $0
Rick E. Maples 0 $0 3,891 0 $ 5,346 $0
Charles R. Hartman 0 $0 4,135 12,403 $ 0 $0
James D. Sumption 0 $0 14,581 0 $14,628 $0
Lawrence E. Somraty 0 $0 5,992 0 $ 8,234 $0
- ---------------
<FN>
(1) Based on the Company's Common Stock closing price on December 31, 1995 of $6.31 ($6.625 actual, adjusted for the
5% stock dividend declared January 23, 1996).
Employment Agreements
The Company and George H. Walker III entered into an Employment Agreement
as of August 21, 1987 and a First Amendment to Employment Agreement as of
December 2, 1991, which provides for the employment of Mr. Walker by the
Company at a base salary as established from time to time by the Board of
Directors, but not less than $150,000 per annum. Mr. Walker is also eligible to
participate in all incentive compensation plans and other employee benefits
provided to senior executive officers.
The term of the Agreement is to December 31, 1997, as explained below. The
Agreement provides that the term of employment is to December 31, 1996;
provided, however, that on December 31, 1995, and on each December 31
thereafter, the term shall be automatically extended for one additional year
unless, prior to such December 31, the Board elects not to extend. Since the
Board did not elect not to extend the term of employment prior to December 31,
1995, the Agreement was extended by its terms to December 31, 1997. The
Agreement, as amended, also provides that Mr. Walker will provide consulting
and advisory services to the Company for a period of two years following the
termination date of his employment for a fee of $75,000 per annum and contains
a one year non-competition covenant following the end of his consulting period.
The obligations of the Company under Mr. Walker's Agreement will terminate
upon the death or (except as described below) resignation of Mr. Walker, except
that, if his employment is terminated by reason of death or disability,
payments will continue in accordance with the Company's regular policies. If
Mr. Walker's employment is terminated by the Company for any other reason
(other than a "Good Cause Event" defined in the Agreement) or if he resigns
within one year after a Change of Control (as defined below), the Company will:
(a) continue his insurance benefits and (b) pay him a lump sum payment equal to
the total of the present value of monthly payments equaling 1/12 of his current
compensation (including bonus and incentive compensation payments) at the date
14
of termination payable over the remaining term of the Agreement, but not less
than one year, or three years in the event of his resignation, or a termination
by the Company in breach of the Agreement, after a Change in Control. Such
payments are subject to reduction to the extent they exceed the amounts
deductible by the Company for federal income tax purposes because of
Section 280G of the Internal Revenue Code of 1986, as amended (the "Code").
"Change of Control" is defined in Mr. Walker's Agreement as (a) the
acquisition, in one or a series of transactions by a person or group of persons
acting in concert, of beneficial ownership in more than 25% of the outstanding
voting stock of the Company, (b) the receipt of proxies for the election of
directors in opposition to management's nominees which aggregate more than 40%
of the outstanding voting stock, or (c) the sale or issuance of such number of
shares of voting stock of the Company for consideration other than cash in any
transaction or series of related transactions which constitutes more than 25%
of the outstanding voting power of the Company after giving effect to such
issuance or sale.
The Company and Gregory F. Taylor entered into an Employment Agreement as
of July 26, 1993 which provides for the employment of Mr. Taylor by the Company
at a base salary as established from time to time by the Board of Directors,
but not less than $175,000 per annum. Mr. Taylor is also eligible to
participate in all incentive compensation plans and other employee benefits
provided to senior executive officers.
The term of employment in Mr. Taylor's Agreement is to July 31, 1996;
provided, however, the obligations of the Company under the Agreement will
terminate upon the death or (except as described below) resignation of Mr.
Taylor, except that, if his employment is terminated by reason of death or
disability, payments will continue in accordance with the Company's regular
policies. If Mr. Taylor's employment is terminated by the Company for any other
reason (other than a "Good Cause Event" defined in the Agreement) or if he
resigns within one year after a Change of Control (as defined below), the
Company will: (a) continue his insurance benefits and (b) pay him a lump sum
payment equal to the total of the present value of monthly payments equaling
1/12 of his current compensation (including bonus and incentive compensation
payments) at the date of termination payable over the remaining term of the
Agreement, but not less than one year. Such payments are subject to reduction
to the extent they exceed the amounts deductible by the Company for federal
income tax purposes because of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code").
"Change of Control" is defined in Mr. Taylor's Agreement as (a) the
acquisition, in one or a series of transactions by a person or group of persons
acting in concert, of beneficial ownership in more than 25% of the outstanding
voting stock of the Company, (b) the receipt of proxies for the election of
directors in opposition to management's nominees which aggregate more than 40%
of the outstanding voting stock, (c) the sale or issuance of such number of
shares of voting stock of the Company for consideration other than cash in any
transaction or series of related transactions which constitutes more than 25%
of the outstanding voting power of the Company after giving effect to such
issuance or sale, (d) the sale or other transfer of 50% or more of the capital
stock of Stifel, Nicolaus or (e) the sale or other transfer of all or
substantially all of the assets of the Company or Stifel, Nicolaus.
Stifel, Nicolaus and Charles R. Hartman entered into a letter agreement on
May 23, 1994 which provides for the employment of Mr. Hartman at a base salary
of $150,000 per annum. Mr. Hartman is eligible to participate in the executive
15
bonus pool and, for fiscal 1994, 1995 and 1996, his bonus payment has been
guaranteed to be no less than $150,000 (pro rated for that portion of each year
actually employed). He was also provided a relocation allowance of $36,276, a
$50,000 interest-bearing line of credit due June 30, 1995, a $75,000 loan which
is forgivable over a five year period if he continues employment with Stifel,
Nicolaus, and options to purchase 15,750 shares of Common Stock of the Company.
Mr. Hartman is also eligible to participate in all other employee benefits
provided to senior executive officers.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors has furnished the
following report on executive compensation for the year ended December 31,
1995:
Executive Officer Compensation Policies and 1995 Results
The Compensation Committee of the Board of Directors administers the
Company's executive officer compensation programs, consisting primarily of base
salary and performance-based annual bonuses. In addition, the Committee has the
discretion to grant restricted stock awards and stock options. The Committee
believes it has established compensation policies for the Company's executive
officers that will attract and retain talented individuals and reward
productivity and profitability.
Salaries and salary adjustments for executive officers are based on the
responsibilities, performance and experience of each executive. Traditionally,
the Company has paid modest salaries relative to comparable executive positions
at other publicly held companies and relied on an annual bonus program to
fairly compensate and motivate executives. At several meetings during 1995,
the Compensation Committee reviewed compensation levels of executive officers
of publicly-held regional brokerage firms in connection with its evaluation of
the Company's overall compensation programs. The Compensation Committee has
made such review a regular process of its responsibilities.
Messrs. Taylor and Hartman participate in the executive bonus pool program.
Over the last several years, the Compensation Committee has modified this
annual bonus program by introducing a formula based approach and eliminating
the discretion related to annual bonuses. Under the 1995 executive bonus
program, bonuses would have been paid if pre-tax income for the Company
exceeded a specified level and certain performance-based factors, such as
targets for return on revenues and return on stockholders' equity, were
satisfied. As a result of Company-wide performance in 1995, no bonuses were
paid to Mr. Taylor. In addition, no bonuses would have been paid to Mr.
Hartman, except that in connection with his recruitment as an executive officer
of the Company, the Company agreed to guarantee Mr. Hartman's 1995 and 1996
bonus payments at no less than $150,000. Mr. Maples participates in a bonus
pool for the Company's financial institutions group of the corporate finance
group. Mr. Sumption participates in a bonus pool based on the financial
performance of Pin Oak Capital, Ltd. Mr. Somraty participates in a bonus pool
based on the financial performance of Century Securities Associates, Inc.
These pools receive a variable percentage of pre-tax, "after allocation,"
income of the applicable business unit. Individual percentages with respect to
these bonus pools are determined by the director of the business units, subject
to the approval of the Chief Executive Officer.
16
In addition, Mr. Taylor has an employment agreement and Mr. Hartman has a
letter agreement. The principal terms of such agreements have also been
described above under "Executive Compensation -- Employment Agreements". The
employment agreement with Mr. Taylor and the letter agreement with Mr. Hartman
were each approved by the entire Board of Directors.
While the Committee believes that the Company's various annual bonus
programs and employment agreements will reinforce the importance of long-term
values for the Company's stockholders, the Committee also seeks to promote the
identity of long-term interests between the Company's executive officers and
its stockholders with occasional grants of restricted stock and stock options.
Many of the Company's key executive officers currently own significant shares
of the Company's common stock and, as a result, stock options and restricted
stock grants have been used sparingly.
Chief Executive Officer
On October 26, 1992, Mr. Taylor was named Chief Executive Officer of the
Company succeeding Mr. Walker, who remains as Chairman of the Board of
Directors. Mr. Taylor previously served as Vice President of the Company and
Executive Vice President and Chief Operating Officer of Stifel, Nicolaus. On
July 26, 1993, the Company and Mr. Taylor entered into an employment agreement
which is described above under "Executive Compensation -- Employment
Agreements". For 1995, Mr. Taylor's salary remained at the level established
in July 1993 until July, 1995, when the Board of Directors established his
salary to be $200,000 per annum. As noted above, as a result of Company
performance in 1995, Mr. Taylor received no bonus with respect to 1995.
1995 Compensation Committee
Robert E. Lefton, Chairman
Belle A. Cori
17
PERFORMANCE GRAPH
The following graph sets forth a comparison of the Company's cumulative
total stockholder return (assuming investment of $100 and reinvestment of
dividends) from December 1990 through December 31, 1995, with the cumulative
total return for the same period measured by the Standard & Poor's 500
Composite Index and, as peer groups, the Lipper Analytical Regional Index and
Financial Services Analytics, Inc. Regional Index (the "FSA Regional Index"),
indices of publicly traded regional brokerage firms. The Company has decided
to use the FSA Regional Index because of improved serviceability provided by
Financial Services Analytics, Inc. The two indices are otherwise substantially
the same.
[PERFORMANCE GRAPH]
December 31
- -------------------------------------------------------------------------------
1990 1991 1992 1993 1994 1995
---- ---- ---- ---- ---- ----
Stifel Financial Corp. 100 207 214 311 196 232
S&P 500 Index 100 130 140 154 156 215
Lipper Regional 100 263 294 387 328 467
FSA Regional Index 100 257 288 377 321 475
Compensation Committee Interlocks and Insider Participation
During the year ended December 31, 1995, the Compensation Committee was
composed of Mr. Lefton and Ms. Cori, neither of whom served as an officer or
employee of the Company or any of its subsidiaries.
John J. Goebel is a partner in the law firm Bryan Cave LLP, which renders
legal services to the Company and its subsidiaries.
Robert E. Lefton, Ph.D. is the President and Chief Executive Officer of
Psychological Associates, Inc., an international training and consulting firm,
which renders services for the Company and its subsidiaries.
CERTAIN TRANSACTIONS
Certain officers, directors and nominees for director of the Company
maintain margin accounts with Stifel, Nicolaus pursuant to which Stifel,
Nicolaus may make loans for the purchase of securities. All margin loans are
made in the ordinary course of business on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons, and do not involve more than normal
risk of collectability or present other unfavorable features.
Richard F. Ford is a General Partner of the management companies which act
as the General Partner of Gateway Mid-America Partners, L.P., Gateway Venture
Partners II, L.P., Gateway Venture Partners III, L.P. and Gateway Partners,
L.P. (the "Gateway Funds"), private venture capital funds formed in 1984, 1987,
1990 and 1994, respectively. The Company and Stifel Venture Corp., a subsidiary
of the Company, are also General Partners of the management companies. At
December 31, 1995, the Company's carrying value of these investments was
approximately $623,000 with a commitment to contribute $268,839 to the Gateway
Funds. Additionally, at December 31, 1995, the Company had a receivable of
18
$220,000 which was advanced for organizational costs of Gateway Partners, L.P.
Mr. Ford also provided consulting services to the Company during the year ended
December 31, 1995.
COMPLIANCE WITH SECTION 16(a)
Section 16(a) of the Securities Exchange Act of 1934 requires that the
Company's officers and directors, and persons who own more than ten percent of
the Company's outstanding stock, file reports of ownership and changes in
ownership with the Securities and Exchange Commission and the New York Stock
Exchange. During 1995, to the knowledge of the Company, all Section 16(a)
filing requirements applicable to its officers, directors, and greater than ten
percent beneficial owners were complied with, except that Mr. Dill failed to
timely file a Form 4, representing one transaction. The form has since been
filed.
PROPOSAL II:
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors, upon the recommendation of its Audit Committee, has
determined to appoint Coopers & Lybrand L.L.P. as the Company's independent
accountants for the year ending December 31, 1996. A resolution will be
presented at the meeting to ratify the appointment of Coopers & Lybrand L.L.P.
The Company has been advised that a representative of Coopers & Lybrand
L.L.P. will be present at the meeting with an opportunity to make a statement
if such representative desires and will be available to respond to questions of
the stockholders.
The Board of Directors recommends a vote FOR ratification of the
appointment of Coopers & Lybrand L.L.P. as the Company's independent
accountants for the year ending December 31, 1996.
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the 1997 Annual
Meeting of Stockholders must be received by the Company by December 1, 1996,
for inclusion in the Company's Proxy Statement and proxy relating to that
meeting. Upon receipt of any such proposal, the Company will determine whether
or not to include such proposal in the Proxy Statement and proxy in accordance
with regulations governing the solicitation of proxies.
MISCELLANEOUS
The Company will bear the cost of solicitation of proxies. Proxies will be
solicited by mail. They may also be solicited by officers and regular employees
of the Company and its subsidiaries personally or by telephone, but such
persons will not be specifically compensated for such services. Brokerage
houses, custodians, nominees and fiduciaries will be requested to forward the
soliciting material to the beneficial owners of stock held of record by such
persons and will be reimbursed for their reasonable expenses incurred in
connection therewith.
Management knows of no business to be brought before the Annual Meeting of
Stockholders other than that set forth herein. However, if any other matters
19
properly come before the meeting, it is the intention of the persons named in
the proxy to vote such proxy in accordance with their judgment on such matters.
Even if you plan to attend the meeting in person, please execute, date and
return the enclosed proxy promptly. Should you attend the meeting, you may
revoke the proxy by voting in person. A postage-paid, return-addressed envelope
is enclosed for your convenience. Your cooperation in giving this your prompt
attention will be appreciated.
By Order of the Board of Directors,
CHARLES R. HARTMAN, Assistant Secretary
March 22, 1996
St. Louis, Missouri
20
ANNEX A
PROXY CARD
[FRONT OF CARD]
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints George H. Walker III and Charles R. Hartman
or either one of them, as Proxies, each with the power to appoint a substitute
and hereby authorizes each to represent the undersigned and to vote as
designated below all the shares of common stock of Stifel Financial Corp.
entitled to be voted by the undersigned at the annual meeting of stockholders
to be held on April 23, 1996 and any adjournment thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE FOLLOWING:
1. ELECTION OF DIRECTORS:
[ ] FOR all nominees listed below (except as marked below)
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below.
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW.
For term expiring in 1999:
Belle A. Cori and Gregory F. Taylor
[BACK OF CARD]
2. PROPOSAL TO RATIFY THE APPOINTMENT OF COOPERS & LYBRAND L.L.P. as
independent public accountants of the Company:
[ ] For [ ] Against [ ] Abstain
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting and any adjournment
thereof.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this proxy
will be voted FOR Proposals 1 and 2.
The undersigned acknowledges receipt of the 1995 Annual Report to
Stockholders and the Notice of the 1996 Annual Meeting and the Proxy Statement.
Please mark, sign, date and return the proxy card promptly using the enclosed
envelope.
[ ] PLEASE CHECK THIS BOX IF YOU PLAN TO ATTEND THE
MEETING IN PERSON.
SIGN HERE
--------------------------------------------
(Please sign exactly as name appears hereon)
SIGN HERE
--------------------------------------------
Executors, administrators, trustees, etc.
should so indicate when signing
DATED
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