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. )
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[ ] Preliminary proxy statement [ ] Confidential, for use of the
[X] Definitive proxy statement Commission only (as permitted by
[ ] Definitive additional materials Rule 14a-6(e)(2))
[ ] Soliciting material pursuant to Rule 14a-11(C)or Rule 14a-12
Atalanta/Sosnoff Capital Corporation
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(Name of Registrant as specified in Its Charter)
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(Name of Person[s] Filing Proxy Statement, if other than the Registrant)
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ATALANTA/SOSNOFF CAPITAL CORPORATION
101 PARK AVENUE
NEW YORK, N.Y. 10178
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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To the Stockholders of
Atalanta/Sosnoff Capital Corporation
The Annual Meeting of Stockholders of Atalanta/Sosnoff Capital
Corporation (the "Company") will be held at Bear, Stearns & Co. Inc., 383
Madison Avenue, 13th Floor, New York, New York, on Thursday, May 9, 2002 at
11:00 a.m. local time, to consider and vote upon:
1. The election of directors for the ensuing year;
2. Approval of the Amendment to the Management Incentive Plan;
3. Ratification of the appointment of independent auditors for 2002; and
4. Such other matters as may properly come before the meeting.
The close of business on March 22, 2002 has been fixed as the record date
for the determination of the stockholders entitled to notice of, and to vote
at, the Annual Meeting, and any adjournments thereof. The Company's stock
transfer books will not be closed.
By Order of the Board of Directors,
Anthony G. Miller
Secretary
Dated: March 22, 2002
IT IS IMPORTANT THAT YOUR STOCK BE REPRESENTED AT THE ANNUAL MEETING. IF
YOU DO NOT EXPECT TO ATTEND THE MEETING, AND WISH TO HAVE YOUR STOCK
REPRESENTED AT THE MEETING, PLEASE COMPLETE AND SIGN THE ACCOMPANYING FORM OF
PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED
IN THE UNITED STATES.
ATALANTA/SOSNOFF CAPITAL CORPORATION
101 PARK AVENUE
NEW YORK, N.Y. 10178
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PROXY STATEMENT
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This proxy statement is being mailed to the stockholders of
Atalanta/Sosnoff Capital Corporation (the "Company"), on or about March 31,
2002 in connection with the Annual Meeting of Stockholders to be held at Bear,
Stearns & Co. Inc., 383 Madison Avenue, 13th Floor, New York, New York, on
Thursday, May 9, 2002 at 11:00 a.m. and any adjournments thereof.
RECORD DATE
The close of business on March 22, 2002 has been fixed as the record date
for the determination of stockholders entitled to receive notice of, and to
vote at, the Annual Meeting.
SOLICITATION
The enclosed proxy is solicited by the Board of Directors of the Company.
The Chairman of the Board, the President and the Secretary have been
designated by the Board of Directors to act as proxyholders. All proxies
delivered pursuant to this solicitation are revocable at the option of the
person executing the same at any time prior to the voting of the proxy, by
delivering a valid superseding proxy or a written notice of revocation signed
in the same manner as the original proxy, or by attending the meeting and
voting in person.
EXPENSES
The cost of preparing, assembling and mailing the notice, proxy statement
and proxy will be borne by the Company. In addition to solicitation by mail,
certain officers and employees of the Company, who will receive no
compensation for their services other than their regular salaries, may solicit
proxies in person or by telephone or telegraph. These persons may be
reimbursed for their expenses. The Company may also make arrangements with
brokerage houses, custodians, nominees and other fiduciaries to send proxy
material to their principals, and the Company will reimburse them for their
expenses.
VOTING BY MR. SOSNOFF
Martin T. Sosnoff, the Company's Chairman of the Board and Chief
Executive Officer, who owns approximately 79% of the Company's outstanding
common stock, has advised the Company that he intends to vote for the Board's
nominees as directors of the Company, and for the other specified matters to
be voted upon at the Annual Meeting. Accordingly, such matters can be approved
without the vote of any other stockholders of the Company.
Dated: March 22, 2002
1
VOTING BY PROXY
If the stockholder is a corporation, the accompanying proxy card should
be signed in its corporate name by an officer. If signed as attorney,
executor, administrator, trustee or guardian, the signer's full title should
be given and, if possible, a certificate or other evidence of appointment
should be furnished.
If the stockholder specifies on the proxy card how the shares are to be
voted, they will be voted accordingly. If the stockholder does not specify on
the proxy card how the shares are to be voted, they will be voted "FOR" the
election of the nominees for directors listed herein; "FOR" the approval of
the Amendment to the Management Incentive Plan; and "FOR" the ratification of
the appointment of independent auditors named herein for 2002.
If the stockholder wishes to give a proxy to someone other than those
designated by the Board of Directors, the three names appearing on the
enclosed proxy card may be crossed out and the name of another person may be
inserted. The signed proxy card should be presented at the meeting by the
person representing the stockholder. Such person should have proof of
identification.
OUTSTANDING STOCK
The Company's common stock, $.01 par value, of which there were 8,875,707
shares outstanding as of March 22, 2002, constitutes the only class of voting
securities issued by the Company. Stockholders will be entitled to cast one
vote, in person or by proxy, for each share of the Company's common stock they
hold.
GENERAL INFORMATION
BOARD OF DIRECTORS
The Board of Directors has responsibility for establishing broad
corporate policies and for the overall management and performance of the
Company, although it is not involved in day-to-day operating details. The
members of the Board who are not senior officers of the Company are kept
informed of the Company's business by various reports and documents given to
them from time to time, as well as by operating, financial and other reports
made at Board and Committee meetings.
Regular meetings of the Board of Directors are generally held four times
per year and special meetings are scheduled when required. The Board held four
regular meetings in 2001, and acted by unanimous written consent on one
occasion.
COMPENSATION OF DIRECTORS
Non-employee directors receive an annual retainer of $12,000. They also
receive a fee of $2,000 for each Board meeting attended, plus travel and
incidental expenses. The maximum annual director's fee is $20,000. The three
full-time employees who serve as directors receive only reimbursement of
expenses, if any, actually incurred in attending meetings. During fiscal 2001,
Mr. Thurston Twigg-Smith and Mr. Ronald H. Menaker each received $20,000, and
Mr. Jay S. Goldsmith received $15,000, in regular compensation for serving as
non-employee directors of the Company.
2
COMMITTEES OF THE BOARD
The permanent Committees established by the Board of Directors to assist
it in the discharge of its responsibilities are described below. The
biographical information on the directors, set forth hereinafter in the proxy
statement, identifies the Committee memberships held by each director.
The Audit Committee recommends to the Board (for appointment by the Board
and ratification by the stockholders) independent public accountants to be
used by the Company, reviews recommendations made by the independent public
accountants concerning the Company's accounting methods and system of internal
controls, reviews and reports to the Board with respect to the audit conducted
by the Company's independent public accountants, reviews with the independent
auditors the firm's relationship with management, and approves each major
professional service provided by the independent auditors in non-audit fields.
The Audit Committee, which in 2001 consisted of three non-employee directors,
met three times during 2001.
The Executive Committee has, subject to certain exceptions, all the
powers and duties of the Board of Directors in the management of the Company
when the Board is not in session and which are not in conflict with specific
powers conferred by the Board upon any other Committee. The Executive
Committee consists of Messrs. Sosnoff and Steinberg. The Executive Committee
did not formally meet during 2001.
The Compensation Committee acts on recommendations of management
concerning the compensation of executive officers of the Company, including
the Chief Executive Officer, and sets compensation policy. A Sub-Committee of
the Compensation Committee administers the Company's Management Incentive Plan
("MIP"). The Stock Option Committee administers options outstanding under the
Company's terminated Stock Option ("SOP") and Incentive Stock Purchase Plans.
The Stock Option and Compensation Committees administer the Company's 1996
Long Term Incentive Plan ("LTIP"). Mr. Sosnoff and the outside directors
comprise the Compensation and Stock Option Committees, while the outside
directors form the Sub-Committee of the Compensation Committee. The
Compensation Committee and Sub-Committee met once in 2001, and acted once by
Unanimous Written Consent.
The Company has no standing Nominating Committee.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Sosnoff, the Company's Chief Executive Officer and principal
stockholder, is a member of the Compensation Committee and the Stock Option
Committee. He does not participate in decisions relating to his compensation,
is not a member of the Compensation Sub-Committee, and does not participate in
decisions relating to the MIP. See "Board Compensation Committee Report"
hereinafter in this proxy statement. In 2001, these Committees had three
non-employee directors as members.
3
PROPOSAL 1
ELECTION OF DIRECTORS
A Board of five directors is to be elected at the Annual Meeting; each
director so elected to hold office for a term of one year and until the
election and qualification of a successor. It is intended that the proxies
will be voted for the following persons nominated by the Board of Directors:
Jay S. Goldsmith, Ronald H. Menaker, Martin T. Sosnoff, Craig B.
Steinberg and Thurston Twigg-Smith.
Each of the nominees has indicated his willingness to serve as a member
of the Board of Directors, if elected; however, in case any nominee shall for
any reason become unavailable for election the proxy holders will have
discretionary authority to use the proxies they hold to vote for a substitute.
Mr. Sosnoff was first elected by the stockholders in 1986, prior to the
Company's initial public offering. Mr. Twigg-Smith was first elected by the
stockholders in 1994. Mr. Steinberg was appointed to the Board in August, 1997
and first elected by the stockholders in 1998. Mr. Menaker was first elected
by the stockholders in 1999. Mr. Goldsmith was first elected by the
stockholders in 2001.
Messrs. Sosnoff and Steinberg are executive officers of the Company.
Information about the proposed nominees' principal occupations, Board
Committee memberships and other information follows. Information about their
ownership of the outstanding common stock of the Company appears hereinafter
under the caption, "Beneficial Ownership of Securities of the Company."
NAME, PRINCIPAL OCCUPATION
AND OTHER INFORMATION
JAY S. GOLDSMITH, 58, for more than five years has been President of
Balfour Investors, Inc. (a merchant banking firm) and the Vice
Chairman of PubliCARD, Inc. (a smart-card technology company).
In a judgement in 1998 in the United States District Court, Southern
District of New York, Mr. Goldsmith was held liable pursuant to Section
16(b) of the Securities Exchange Act of 1934 to repay to New Valley
Corp. "short-swing" profits he earned from certain purchases and sales
of that corporation's B Preferred Stock within a six-month period. Mr.
Goldsmith has advised the Company and the Company has concluded after
review, that the decision was based on a technical analysis of the
language in Section 16(b). The Appeals Court in affirming the decision
mentioned that the District Court had suggested that "...the
defendants, though liable, might well have acted in good faith."
Mr. Goldsmith serves on the Audit, Compensation and Stock Option
Committees.
RONALD H. MENAKER, 57, since January 1, 2000 has been retired. From July,
1998 through December, 1999 he was an Advisory Director of, and for
more than five years prior thereto he was a Managing Director of, and
held other offices with, J.P. Morgan & Co., Inc.
Mr. Menaker serves on the Audit, Compensation and Stock Option
Committees.
MARTIN T. SOSNOFF, 70, is the founder of the Company and has been Chairman
of the Board, Chief Executive Officer, and Chief Investment Officer of
the Company and its subsidiaries since their inceptions.
Mr. Sosnoff serves on the Executive, Compensation and Stock Option
Committees.
CRAIG B. STEINBERG, 40, has been President and Director of Research, and
has held other offices, with the Company and its subsidiaries since
1985.
Mr. Steinberg serves on the Executive Committee.
THURSTON TWIGG-SMITH, 80, retired as of March, 2002. For more than five
years prior thereto he was Chairman of the Board and Chief Executive
Officer of Persis Corporation (newspaper publishing).
Mr. Twigg-Smith serves on the Audit, Compensation and Stock Option
Committees.
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EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding compensation
paid during each of the Company's last three fiscal years to the Company's
Chief Executive Officer and to each of the Company's four other most highly
compensated executive officers who were officers during 2001.
ANNUAL COMPENSATION LONG-TERM COMPENSATION
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SECURITIES ALL OTHER
NAME AND OTHER ANNUAL RESTRICTED STOCK UNDERLYING COMPEN-
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION AWARDS OPTIONS SATION (10)
------------------ ---- ------ ----- ------------ ------ ------- ----------
MARTIN T. SOSNOFF 2001 $1,000,000 $ 0 (1) $8,500
Chairman of the Board; 2000 1,000,000 2,405,350 (1) 17,000
Chief Executive Officer; Director 1999 1,000,000 3,446,000 (1) 16,000
CRAIG B. STEINBERG 2001 700,000 264,022 (1,2) $1,588,500 (4) $8,500
President and Director 2000 700,000 2,404,744 (1) 1,573,500 (4) 17,000
of Research; Director 1999 700,000 86,758 (3) 1,479,750 (4) 16,000
ANTHONY G. MILLER 2001 350,000 $ 0 (1) 463,313 (6) $8,500
Executive Vice President, 2000 350,000 181,150 (1,5) 458,938 (6) 17,000
Chief Operating Officer, 1999 350,000 50,000 (5) 431,594 (6) 16,000
Secretary
JAMES D. STAUB 2001 175,000 $699,914 (7) $8,500
Senior Vice President 2000 175,000 619,486 (7) 17,000
of subsidiaries 1999 175,000 489,188 (7) 16,000
WILLIAM M. KNOBLER 2001 103,125 (8) 558,630 (9) $8,500
Senior Vice President 2000 113,975 (8) 824,189 (9) 17,000
of subsidiary 1999 334,245 (8) 1,499,800 (9) 16,000
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(1) Represents amounts received as bonuses by participants in the
Company's MIP. See "Management Incentive Plan" hereinafter in this
proxy statement.
(2) Includes a discretionary bonus of $200,000 in 2001.
(3) Based on an agreement with the Company, Mr. Steinberg receives a
bonus based upon the pre-tax operating profits receivable by a
subsidiary of the Company as general partner of the investment
partnership Mr. Steinberg manages on behalf of the Company. See
"Management Incentive Plan" hereinafter in this proxy statement.
(4) Represents non-cash compensation required to be reported for tax
purposes. Mr. Steinberg was awarded the right to purchase and
purchased 600,000 shares of the Company's common stock for the
purchase price of $0.01 per share as of September 17, 1997 under the
Company's LTIP. For tax purposes, the Company and Mr. Steinberg
report the compensation element of the award in the years in which
the Company's right to repurchase equal fractions of the award lapse
at the first through the fourth anniversaries of the date of the
award. Under this method, Mr. Steinberg will report compensation of
$1,588,500 in 2001 (based on a market price of $10.60 per share at
the fourth anniversary), and reported $1,573,500 in 2000 (based on a
market price of $10.50 per share at the third anniversary), and
$1,479,750 in 1999 (based on a market price of $9.88 per share at the
second anniversary), and $1,273,500 in 1998 (based on a market price
of $8.50 per share at the first anniversary). The Company recorded
unearned compensation in shareholders' equity of approximately $7.0
million at the time of the award which was amortized to compensation
expense. Approximately $436,000 was expensed in the fourth quarter of
1997 for financial reporting purposes and approximately $1.7 million
was expensed in each full calendar year thereafter as the right to
repurchase the award lapsed, ending September 30, 2001. At September
17, 1997, the stock award value was approximately $7.0 million based
on the difference between the purchase price and the market value of
the award at such date, and the stock award value was approximately
$7.2 million based upon such calculation at December 31, 1997, $5.0
million at December 31, 1998, $5.2 million at December 31, 1999, $6.4
million at December 31, 2000, and $6.2 million at December 31, 2001.
In 1997, the Company loaned Mr. Steinberg $46,740 with interest at
the applicable federal rate for taxes attributable to dividends paid
on the shares received in his award. In 1998, the Company loaned Mr.
Steinberg $539,847 with interest at the applicable federal rate for
taxes attributable to the compensation element of his award and
dividends paid on the unvested shares received in his award. In 1999,
the Company loaned Mr. Steinberg $849,338 with interest at the
applicable federal rate for taxes attributable to the compensation
element of his award. In 2000, the Company loaned Mr. Steinberg
$762,361 with interest at the applicable federal rate for taxes
attributable to the compensation element of his award. In 2001, the
Company loaned Mr. Steinberg $769,628 with interest at the applicable
rate for taxes attributable to the compensation element of his award
and dividends paid on the unvested shares received in his award. In
1998, Mr. Steinberg paid $11,941 of interest to the Company related
to these loans, in 1999 he paid $45,603, in 2000 he paid $83,718, and
in 2001 he paid $127,673.
5
(5) Includes discretionary bonuses of $50,000 in 1999 and $100,000 in
2000.
(6) Represents non-cash compensation required to be reported for tax
purposes. Mr. Miller was awarded the right to purchase and purchased
175,000 shares of the Company's common stock for the purchase price
of $0.01 per share as of September 17, 1997 under the Company's LTIP.
For tax purposes, the Company and Mr. Miller report the compensation
element of the award in the years in which the Company's right to
repurchase fractions of the award lapses at the first through the
fourth anniversaries of the date of the award. Under this method, Mr.
Miller will report compensation of $463,313 in 2001 (based on a
market price of $10.60 per share at the fourth anniversary), reported
$458,938 in 2000 (based on a market price of $10.50 per share at the
third anniversary), reported $431,594 in 1999 (based on a market
price of $9.88 per share at the second anniversary), and reported
$371,438 in 1998 (based on a market price of $8.50 per share at the
first anniversary). The Company recorded unearned compensation in
shareholders' equity of approximately $2.0 million at the time of the
award which was amortized to compensation expense. Approximately
$127,000 was expensed in the fourth quarter of 1997 for financial
reporting purposes and approximately $508,000 was expensed in each
full calendar year thereafter as the right to repurchase the award
lapsed, ending September 30, 2001. At September 17, 1997, the stock
award value was approximately $2.0 million based on the difference
between the purchase price and the market value of the award at such
date, and the stock award value was approximately $2.1 million based
upon such calculation at December 31, 1997, $1.5 million at December
31, 1998, $1.5 million at December 31, 1999, $1.9 million at December
31, 2000, and $1.8 million at December 31, 2001. In 1997, the Company
loaned Mr. Miller $13,633 with interest at the applicable federal
rate for taxes attributable to dividends paid on the shares received
in his award. In 1998, the Company loaned Mr. Miller $157,455 with
interest at the applicable federal rate for taxes attributable to the
compensation element of the award and dividends paid on the unvested
shares received in his award. In 1999, the Company loaned Mr. Miller
$243,265 with interest at the applicable federal rate for taxes
attributable to the compensation element of the award. In 2000, the
Company loaned Mr. Miller $222,356 with interest at the applicable
federal rate for taxes attributable to the compensation element of
the award. In 2001, the Company loaned Mr. Miller $224,475 with
interest at the applicable federal rate for taxes attributable to the
compensation element of his award and dividends paid on the unvested
shares received in his award. In 1998, Mr. Miller paid $2,843 of
interest to the Company related to these loans, in 1999 he paid
$13,149, in 2000 he paid $24,215, and in 2001 he paid $36,988.
(7) Represents additional compensation paid to Mr. Staub in lieu of a
bonus based upon a percentage of investment advisory fees received by
the Company from clients solicited by Mr. Staub under an agreement
with the Company. See "Agreements and Transactions with Directors and
Executive Officers" hereinafter in this proxy statement.
(8) In 1999 and 2000, Mr. Knobler's salary was set based on the revenues
received by the Company from clients of the Company to whom Mr.
Knobler provides investment management services ("SVP" clients), net
of the costs associated with such revenues, under an arrangement with
the Company. In 2001, Mr. Knobler's salary was set as a percentage of
the gross revenues received from these clients in 2001, under an
arrangement with the Company.
(9) The 2000 and 2001 amounts represent the second and third (final)
installment payments, respectively, made to Mr. Knobler by the
Company in January 2000 and January 2001 relating to the
relinquishment of his right to receive revenue from SVP clients under
a new facilities agreement with the Company. The 1999 amount includes
$1,498,766 representing the first installment payment. See
"Agreements and Transactions with Directors and Executive Officers".
(10) Represents contributions by the Company to the account of such
officers under the Company's Profit Sharing Plan for its employees.
See "Profit Sharing Plan" hereinafter in this proxy statement.
Except as noted, none of the individuals listed above received non-cash
compensation during 2001 in excess of the lesser of $50,000 or 10% of
his total annual salary and bonus.
6
COMPARATIVE STOCK PERFORMANCE
The following line graph compares the cumulative total shareholder
return on the Company's common stock with the cumulative total return of the
Russell 2000 Index(1) and the Russell 2000/Financial Services Index(2) over the
five year period ended December 31, 2001 (assuming the investment in the
Company's common stock and such indices of $100 on December 31, 1996, and the
reinvestment of all dividends):
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL STOCKHOLDER RETURN AMONG THE COMPANY,
RUSSELL 2000 INDEX, AND RUSSELL 2000/FINANCIAL SERVICES INDEX
Year Ended December 31
1996 1997 1998 1999 2000 2001
Russell 2000/Financial Services Index 100 138 126 119 144 166
Russell 2000 Index 100 122 119 145 140 144
Company 100 136 100 104 130 128
[GRAPHIC OMITTED]
RUSSELL 2000/
COMPANY RUSSELL 2000 FINANCIAL SERVICES
------- ------------ ------------------
Annualized rates of return:
5 years ended 12/31/01 5.1% 7.6% 10.7%
(1) The Russell 2000 Index is published by the Frank Russell Company and
is widely recognized as a measure of the performance of small market
capitalization stocks like the Company's common stock.
(2) The Russell 2000/Financial Services Index is an index of the
performance of financial services companies within the Russell 2000
Index.
7
BOARD COMPENSATION COMMITTEE REPORT
The Board has requested that the Compensation Committee describe in this
Report (a) its compensation policies generally applicable to the executive
officers of the Company, including the specific relationship of corporate
performance to executive compensation for 2001; and (b) the basis for Mr.
Sosnoff's compensation in 2001, including the factors and criteria on which
Mr. Sosnoff's compensation was based and the relationship of the Company's
performance to such compensation describing the measures of performance on
which such compensation was based.
Compensation Policies Generally Applicable to Executive Officers
In formulating its compensation policies for executive officers, the
Committee considers many factors, including the major factors described below:
Industry Compensation Standards, Salary History, Performance in Position,
Tenure of Employment.
The Committee believes that in order to attract and retain executive
officers of the highest quality the Company must provide a total package of
compensation that is competitive with other companies in the Company's segment
of the financial services industry. The Committee also reviews the salary
histories of current and prospective executive officers in making compensation
recommendations. In addition, the Committee reviews information about the
performance of executive officers. In formulating its compensation policies
the Committee generally places less weight on the qualitative elements of
executive officer performance, and more weight on the economic indices of the
officer's performance measured by the financial performance of the aspect of
the Company's business for which the officer is primarily responsible. The
Committee believes that an officer's employment tenure is entitled to some
weight in assessing appropriate levels of compensation.
Company Performance-General
The Committee believes that in the Company's case in the formulation of
executive officer compensation policy the Committee should not accord
significant weight to the market performance of the Company's common stock.
The Committee notes that the price at which the Company's common stock trades
often bears little relationship to the underlying fundamentals of the Company.
Because of the ownership structure (only approximately 12% of the Company's
common stock is held by the public) and lack of coverage by analysts, there is
very little trading activity in the common stock of the Company. During 2001,
aggregate market transactions in the Company's common stock (excluding shares
purchased in the market by the Company) equaled approximately 2.7% of the
common stock outstanding. As a result of this low turnover, the performance of
the common stock has not reliably reflected the financial results or prospects
for the Company; instead, it generally reflects market forces that result in
volatile stock performance because of the lack of market liquidity. Thus, in
the Committee's view, the investment performance of the Company's common stock
has not offered the Committee reliable guidance in formulating executive
officer compensation policy and in setting appropriate compensation levels for
the Company's executive officers. The Committee notes that the Company's book
value per share totaled $11.52 at the end of 2001, which has not been
adequately reflected in the price of the stock.
Financial Performance
The Committee has developed a number of financial performance criteria in
formulating its executive compensation policy and a number of specific
criteria assessing the appropriateness of specific executive officer
compensation.
In evaluating the performance of the executive officers of the Company as
a group generally, and in reference to 2001 compensation, the Committee has
reviewed the efficiency and productivity of the Company, and the Company's
employees managed by the executive officers as measured by the following
financial performance criteria: (1) Operating revenues, pre-tax operating
income and pre-tax operating income per employee, (2) pre-tax operating income
yield on assets under management, (3) pre-tax operating margin, (4) investment
performance of managed assets, including the Company's proprietary accounts,
and (5) other financial criteria.
8
In reviewing the compensation of specific executive officer positions,
the Committee places more weight on criteria relevant to the responsibilities
of that position. Thus, relatively more weight is attributed to revenue
criteria in evaluating the performance of executives engaged primarily in
marketing and investment management and related support activities and
relatively more weight is attributed to income criteria in fixing the
compensation of personnel engaged in cost management and related support
activities.
2001 Compensation and the Management Incentive Plan
After posting increases in both 1999 and 2000, operating revenues,
operating income, operating margin and operating income per employee all
decreased in 2001, reflecting the difficult market environment and a decrease
in assets under management in 2001 from negative performance results,
partially offset by almost $200 million in new assets from the increased focus
on marketing efforts.
As described below, the changes in 2001 overall compensation as compared
with 2000 and 1999 for executive officers, with the exception of Mr. Staub and
Mr. Knobler who have separate arrangements with the Company, are attributable
to Awards made under the Management Incentive Plan ("MIP"), as follows:
2001 2000 1999
---- ---- ----
1. Operating Earnings Component $ 0 $541,000 $ 0
2. Investment Performance Component 0 2,216,000 3,446,000
3. Sabre Performance Component 64,022 2,215,394 0
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$ 64,022 $4,972,394 $3,446,000
======== ========== ==========
The MIP is designed to reflect the financial performance criteria which
the Company believes should be applied in determining executive officer
compensation. One component (the "Operating Earnings Component") is based on
pre-tax operating earnings before non-cash charges, which the Committee
believes is an appropriate measure of the performance of executive personnel
who function in the revenue producing and in the cost control areas of the
Company. Messrs. Sosnoff and Steinberg participate in the Operating Earnings
Component of the Award Bonus Pool at 35% each, and Messrs. Miller and Paul
Tanico, an Executive Vice President of the Company, participate at 15% each
(Mr. Tanico resigned as an employee at the beginning of 2002). The MIP is
administered by a Sub-Committee of the Compensation Committee, which is
composed entirely of non-employee directors. The Committee believes that the
Operating Earnings Component of the MIP provides a stimulus to a continuing
high level of commitment to further improvement in the financial performance
of the Company. The Committee notes that in the Operating Earnings Component
(a) no awards are payable unless there is an increase in adjusted operating
earnings (as defined in the MIP) over the 1998 base level of adjusted operated
earnings, (b) the annual Award Bonus Pool cannot exceed 50% of incremental
adjusted operating earnings above the threshold, and (c) aggregate annual
bonuses under the Operating Earnings Component of the MIP are capped at 10% of
earnings per share in any one year. The Sub-Committee believes that these
limitations strike an appropriate balance by fulfilling the need to continue
to motivate executive personnel while not unduly impacting the financial
results of the Company. No Operating Earnings Award was made under the MIP in
2001, compared with $541,000 in 2000 and none in 1999.
The Sub-Committee amended the MIP in 1999 to create an Investment
Performance Component of the MIP to provide incentive compensation to Mr.
Sosnoff in an amount equal to 20% of each year's performance of the Company's
proprietary accounts in excess of an identified benchmark. Under the
amendment, no bonus is paid if such performance is negative, even if it
exceeded such benchmark. The computation is made annually, based on each
calendar year's performance results, and is subject to a separate and
independent limitation that it not exceed 10% of earnings per share in any one
year. No award was made to Mr. Sosnoff in 2001 related to this component of
the MIP, compared with $2,216,000 in 2000, and $3,446,000 for 1999.
9
In 2000, the Sub-Committee amended the MIP to provide annual incentive
compensation to the Company's President based upon the investment performance
of Sabre Partners, L.P., an investment partnership which he manages on behalf
of a Company subsidiary, equal to (i) 50% of the pre-tax operating income
(revenues less direct expenses) that the Company receives from that
partnership (the "Sabre Performance Bonus") and (ii) 20% of the outperformance
of the Company's investment in such partnership as compared to the S&P 500
Index (the "Outperformance Bonus"), provided that the Outperformance Bonus is
payable if, and only to the extent that, the performance of the Company's
investment in such partnership is positive, and the closing net asset value of
any measurement period for the computation of the Outperformance Bonus exceeds
the highest level of net assets previously achieved. These computations are
made annually, based on each calendar year's results, and are subject to a
separate and independent limitation that it not exceed 10% of earnings per
share in any one year. Mr. Steinberg was awarded $64,022 for 2001 related to
this Component of the MIP, compared with $2,215,394 for 2000.
The MIP does not preclude the Board of Directors of the Company, upon
approval of the Sub-Committee, from making discretionary bonus payments to
participants in the MIP in addition to the amounts determined under the Plan.
Mr. Steinberg was awarded a discretionary bonus of $200,000 for 2001.
MIP Amendment. Due to the resignation of Mr. Paul P. Tanico, Executive
Vice President, the Sub-Committee has amended the Operating Earnings Component
of the MIP for the two years ended December 31, 2003, subject to stockholder
approval, to change the allocation of the Award Bonus Pool and to provide for
the participation by the two senior portfolio managers of the Company, Messrs.
Sosnoff and Steinberg, and by Mr. Miller. Under the proposed amendment,
Messrs. Sosnoff and Steinberg will participate in the Award Bonus Pool at 40%
each, and Mr. Miller at 20% . As amended, the MIP measures increases in
adjusted operating earnings against such earnings in the 1998 base year and
provides for the allocation of 50% of such increases to the Award Bonus Pool.
See "Approval of Amendment to Management Incentive Plan" hereinafter in this
Proxy Statement. The MIP does not preclude the Board of Directors of the
Company, upon approval of the Sub-Committee, from making discretionary bonus
payments to participants in the MIP in addition to the amounts determined
under the Plan.
The 2001 Compensation of Mr. Sosnoff
Mr. Sosnoff has not participated in this part of the Committee's review
or Report, or in its description of the basis for his compensation generally.
The Committee notes that there are certain qualitative factors in the
analysis of Mr. Sosnoff's compensation generally and in 2001 that, in its
view, should be taken into account in establishing appropriate bases for such
compensation. Mr. Sosnoff is the founder of the Company, which was founded in
1986 to acquire its operating subsidiaries and make a public offering of its
Common Stock. Mr. Sosnoff is the founder of such subsidiaries and is the
Company's principal stockholder. The Company bears his name. He also is a
widely known and respected member of the financial community and has written
regularly in the financial press. The Committee believes his reputation has
enhanced the stature of the Company and has had and will continue to have a
salutary affect on its marketing activities.
In conjunction with the Company's other executive officers, Mr. Sosnoff's
compensation is evaluated under the compensation policies generally applicable
to executive officers, including growth in the Company's book value per share,
and the financial performance criteria considered relevant by the Committee.
Under the Operating Earnings Component of the MIP, Mr. Sosnoff was awarded $ 0
for 2001, compared with $189,350 for 2000, and none in 1999.
10
It is also the policy of the Committee to review Mr. Sosnoff's
compensation in relation to the performance of the Company's client accounts
for which he has primary responsibility in setting investment policy and the
performance of the Company's own proprietary accounts. The Committee notes
that equity investment performance in client accounts improved markedly in the
four years ended December 31, 2001 (each of the four years generated client
performance returns in excess of relevant benchmarks), exceeding all relevant
benchmarks for the Company's composite equity and balanced products. However,
Mr. Sosnoff did not earn an Investment Performance bonus for 2001 under the
Investment Performance Component of the MIP because the performance of the
Company's proprietary accounts in 2001 was negative. In 2000, he earned an
Investment Performance Bonus of $2,216,000 and in 1999 he earned an Investment
Performance Bonus of $3,446,000 based upon the performance of the Company's
proprietary accounts in 2000 and 1999, which achieved net investment
performance totaling 9.2% and 46.0%, respectively, vs. the benchmark's return
of -9.1% and 14.6%, respectively. In the Sub-Committee's view, Mr. Sosnoff's
achievement in significantly increasing the Company's proprietary accounts'
net assets was appropriately reflected in Mr. Sosnoff's increased compensation
in those years.
Dated: March 7, 2002
The Compensation Committee The Compensation Sub-Committee
Jay S. Goldsmith Jay S. Goldsmith
Ronald H. Menaker Ronald H. Menaker
Martin T. Sosnoff Thurston Twigg-Smith
Thurston Twigg-Smith
11
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
The Audit Committee of the Board of Directors of the Company serves as
the representative of the Board for general oversight of the Company's financial
accounting and reporting process, system of internal control, audit process and
process for monitoring compliance with laws and regulations. The Company's
management has primary responsibility for preparing the Company's financial
statements and the Company's financial reporting process. The Company's
independent accountants are responsible for expressing an opinion on the
conformity of the Company's audited financial statements to generally accepted
accounting principles.
In this context, the Audit Committee hereby reports as follows:
1. The Audit Committee has reviewed and discussed the audited financial
statements with the Company's independent accountants.
2. The Audit Committee has discussed with the independent accountants
the matters required to be discussed by SAS 61 (Codification of
Statements on Auditing Standard, AU 380).
3. The Audit Committee has received the written disclosures and the
letter from the independent accountants required by Independence
Standards Board Standard No. 1 (Independence Standards Board
Standards No. 1, Independence Discussions with Audit Committees) and
has discussed with the independent accountants the independent
accountants' independence.
4. Based on the review and discussion referred to in paragraphs (1)
through (3) above, the Audit Committee has recommended to the Board
of Directors of the Company, and the Board has approved, that the
audited financial statements be included in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2001, for
filing with the Securities and Exchange Commission.
Each of the members of the Audit Committee is independent as defined
under the Listing Standards of the New York Stock Exchange.
The undersigned members of the Audit Committee have submitted this
Report to the Board of Directors.
Jay S. Goldsmith
Ronald H. Menaker
Thurston Twigg-Smith
Dated: March 7, 2002
12
STOCK OPTION AND LONG TERM INCENTIVE PLANS
Option Grants for 2001
There were no option grants made in 2001.
Exercises and Awards Outstanding
Option Exercises and Year-End Values for 2001
No stock options were exercised or cancelled in 2001.
The table below sets forth information with respect to the status of
unexercised options, if any, held at December 31, 2001 by the Company's Chief
Executive Officer and the other four most highly compensated executive officers.
AGGREGATE OPTION EXERCISES DURING 2001 AND OPTION VALUES ON DECEMBER 31, 2001
------------------------------------------------------------------------------------------------------------------------------------
Number of
Shares Acquired Value Exercise Value of Unexercised
Upon Exercise of Realized Number of Unexercised Price Per In-the-Money Options
Name Option Upon Exercise Options 12/31/01 Share 12/31/01 (1)
---- ------ ------------- ---------------- ----- ------------
Exercisable Unexercisable Exercisable Unexercisable
------------------------------------------------------------------------------------------------------------------------------------
Craig B. Steinberg 100,000 $ 9.50 $80,000
----------------------- ------------------ -------------- --------------- ----------------- ------------ -------------- -----------
----------------------- ------------------ -------------- --------------- ----------------- ------------ -------------- -----------
Anthony G. Miller 50,000 9.50 40,000
----------------------- ------------------ -------------- --------------- ----------------- ------------ -------------- -----------
----------------------- ------------------ -------------- --------------- ----------------- ------------ -------------- -----------
James D. Staub 50,000 6.13 208,750
----------------------- ------------------ -------------- --------------- ----------------- ------------ -------------- -----------
40,000 10,000 9.00 52,000 $13,000
----------------------- ------------------ -------------- --------------- ----------------- ------------ -------------- -----------
(1) Values are calculated by subtracting the exercise price from the fair
market value of the underlying common stock. For purposes of this
table, fair market value is deemed to be $10.30 per share, the closing
price of the common stock reported for New York Stock Exchange
transactions on December 31, 2001.
As of September 17, 1997, the Company awarded 775,000 shares of
restricted stock at the issue price of $.01 per share to two senior executives
under the terms of the LTIP. Craig B. Steinberg, President and Director of
Research, received 600,000 shares and Anthony G. Miller, Executive Vice
President and Chief Operating Officer, received 175,000 shares. Such
restricted stock awards vested over the four year-period ended September 30,
2001. See the Summary Compensation Table on page 5 of this proxy statement.
Management Incentive Plan
The purpose of the Operating Earnings Component of the Management
Incentive Plan (the "MIP") is to directly relate year-end bonuses of
participants to growth in operating earnings of the Company (adjusted for
non-cash charges and current year accruals under the MIP and the LTIP and
comparable non-cash charges) compared with the base year of 1998. The maximum
aggregate annual award payable to participants under the Operating Earnings
Component of the MIP is subject to the limitation that it cannot result in a
reduction of earnings per share in any one year of more than 10%. Each
participant's share of the aggregate award of the Operating Earnings Component
of the MIP is payable at year-end in assigned percentages.
For 2001, no award was made under the Operating Earnings Component of the
MIP, computed as described above, based upon a decrease in adjusted operating
earnings in 2001 as compared with 1998.
13
Under the Investment Performance Component of the MIP, Mr. Sosnoff is
entitled to an annual bonus (the "Investment Performance Bonus") equal to 20%
of the amount by which the investment performance of the proprietary accounts
of the Company exceeds a benchmark (the S&P 500 Index), so long as such
performance is positive, and subject to the limitation that it cannot result
in a reduction of earnings per share in any one year of more than 10%. For
2001, no Investment Performance Bonus was awarded under the MIP to Mr.
Sosnoff, computed as described above, because the performance of the
proprietary accounts was negative.
Under the Sabre Performance Component of the MIP, Mr. Steinberg is
entitled to an annual Performance Bonus based on (a) 50% of the pretax
operating income earned by a Company subsidiary as general partner of Sabre
Partners, L.P., a Company-sponsored investment partnership, and (b) an
Outperformance Bonus equal to 20% of the amount by which the Company's
proprietary investment in Sabre exceeds a benchmark (the S&P 500 Index), so
long as such performance is positive, and subject to the limitation that these
bonuses together cannot result in a reduction of earnings per share in any one
year of more than 10%. For 2001, a Sabre Performance Bonus of $64,022 was
awarded under the MIP to Mr. Steinberg, computed as described above.
Profit-Sharing Plan
The Company has a Profit-Sharing Plan for its employees. For the year
ended December 31, 2001, contributions in the amount of $208,496 were made to
the Plan.
AGREEMENTS AND TRANSACTIONS WITH DIRECTORS AND EXECUTIVE OFFICERS
Pursuant to Company policy, certain expenses of Mr. Sosnoff which were
initially paid by the Company, to the extent the Company and Mr. Sosnoff have
determined that such expenses would not be borne by the Company, were repaid
to the Company with interest.
Upon termination of his employment Mr. Steinberg is subject to
non-competition and non-solicitation restrictions under his employment
agreement with the Company.
Mr. Staub and certain other members of the marketing and sales staffs of
the Company and its subsidiaries receive additional compensation based on
varying percentages of the revenues attributable to Company clients they have
solicited. Such compensation under certain conditions may continue after
termination of employment.
In May 1985, Atalanta/Sosnoff Management Corporation ("Management")
entered into an employment agreement with Mr. William M. Knobler, Senior Vice
President, to provide investment related services to both Management and
Atalanta/Sosnoff Capital Corporation (Delaware), the Company's operating
subsidiaries. Under the terms of the agreement, Mr. Knobler was paid the net
profits relating to the client accounts he managed at Management (the "Net
Profits"), which represents the advisory fees and commissions for such
accounts, net of clearance and floor brokerage charges, allocated payroll,
overhead and out-of-pocket expenses incurred on his behalf by Management.
Effective October 1, 1998, Management entered into a new agreement with
Mr. Knobler for the period ending December 31, 2000, under which Mr. Knobler
relinquished the net profits from the investment management and brokerage
services provided to the accounts he manages to Management. Pursuant to this
agreement, Management has made payments to Mr. Knobler in three installments
in January 1999, 2000 and 2001, based upon a multiple of annualized revenues
from such accounts. In addition, Management and Mr. Knobler agreed to change
the split of Net Profits paid to Mr. Knobler from 100% during the twelve-month
period ended September 30, 1998, to 50% for the twelve-month period ended
September 30, 1999, 25% for the twelve-month period ending September 30, 2000,
and 0% thereafter. Mr. Knobler has remained an employee of the Company, and in
2001 he earned a salary based on a percentage of the commissions and advisory
fee revenues earned from the accounts he manages. Additionally, the Company
paid Mr. Knobler $558,630 in January, 2001 representing the third and final
installment under this agreement.
14
Options issued under the SOP and LTIP, and restricted stock award shares
granted under the LTIP provide for accelerated vesting in the event of a
change in control of the Company, as defined. Certain of the Company's
agreements with employees provide for additional payments to them, or the
right for such employee to terminate his employment and continue to receive
payments from the Company in the event of a change in control, as defined.
The directors, officers and employees of the Company or its operating
subsidiaries are ordinarily required to execute personal securities
transactions through the Company's broker-dealer subsidiary and are allowed a
discount from the commission rates offered to unaffiliated customers. In
addition, the Company provides personal investment management and advisory
services to certain officers of the Company and its operating subsidiaries and
their associates without charge.
BENEFICIAL OWNERSHIP OF SECURITIES OF THE COMPANY
The following table sets forth information as of December 31, 2001 as to
the beneficial ownership of Company common stock by (1) each person known by
the Company to own 5% or more of the common stock, (2) each director and
nominee for director of the Company, (3) the Company's Chief Executive
Officer, (4) each of the Company's other four most highly compensated
executive officers for fiscal 2001, and (5) the directors and executive
officers of the Company as a group. The persons named in the table have sole
voting and investment power with respect to all shares of common stock owned
by them and use the Company's address as their business address, unless
otherwise noted.
BENEFICIAL OWNERS SHARES BENEFICIALLY OWNED PERCENT OF CLASS (9)
----------------- ------------------------- --------------------
Martin T. Sosnoff 7,012,516 (1) 76.8%
Craig B. Steinberg 700,000 (2) 7.7%
Anthony G. Miller 225,000 (3) 2.5%
William M. Knobler 1,100 (4) (10)
James D. Staub 90,000 (5) 1.0%
Ronald H. Menaker (6) 2,000 (10)
Thurston Twigg-Smith(7) 1,000 (10)
All executive officers
and directors as a
Group (10 persons) 8,031,616 (8) 88.0%
-----------
(1) includes 12,516 shares owned by a private charitable f oundation that
Mr. Sosnoff controls.
(2) includes 600,000 shares issued under the Company's LTIP and 100,000
shares issuable upon exercise of currently exercisable options issued
under the Company's SOP at an exercise price of $9.50 per share.
(3) includes 175,000 shares issued under the Company's LTIP and 50,000
shares issuable upon exercise of currently exercisable options issued
under the Company's SOP at an exercise price of $9.50 per share.
(4) includes 600 shares held in his Individual Retirement Account, 100
shares held by his wife, 200 shares held by her Individual Retirement
Account, and 200 shares held by a private charitable foundation
controlled by Mr. Knobler.
15
(5) includes 50,000 shares issuable upon exercise of currently
exercisable options issued under the Company's SOP at an exercise
price of $6.13 per share and 40,000 shares issuable upon exercise of
currently exercisable options issued under the Company's LTIP at an
exercise price of $9.00 per share. Does not include non-currently
exercisable options to purchase 10,000 shares at an exercise price of
$9.00 per share.
(6) Mr. Menaker's address is 700 Smoke Hollow Trail, Franklin Lakes, New
Jersey, 07417.
(7) Mr. Twigg-Smith's business address is Persis Corporation, 2447 Makiki
Heights Drive, Honolulu, Hawaii 96822.
(8) includes shares owned by executive officers of subsidiaries who have
been designated as executive officers of the Company. Includes
240,000 shares subject to currently exercisable options under the SOP
and LTIP. Does not include non-currently exercisable options to
purchase 10,000 shares.
(9) Calculated on the basis of 8,885,707 shares outstanding at December
31, 2001 plus 240,000 shares subject to currently exercisable
options, or a total of 9,125,707 shares.
(10) less than .1% of shares outstanding.
16
PROPOSAL 2
APPROVAL OF AMENDMENT TO MANAGEMENT INCENTIVE PLAN
History. The purpose of the Operating Income Component of the
Management Incentive Plan (the "MIP") is to directly relate year-end bonuses
of participants to annual growth in operating earnings of the Company
(adjusted for non-cash charges under the LTIP, current year accruals under the
MIP and comparable charges). Under the MIP currently in effect through
December 31, 2003, aggregate operating income awards are based on 50% of
annual increases in adjusted operating earnings above the 1998 Base Year. The
maximum aggregate award payable to participants under the Operating Income
Component of the MIP is subject to the limitation that it cannot result in a
reduction of earnings per share of more than 10%. Each participant's share of
the aggregate award is payable at year-end.
The Operating Income Component of the MIP was first approved by
stockholders in 1994 after its adoption by the Compensation Sub-Committee of
the Board of Directors. For the three years ended December 31, 1998, the
Sub-Committee amended the MIP to change the method of allocation of the Award
Bonus Pool and to provide for the participation by the then four senior
portfolio managers of the Company, and by one other officer, Mr. Miller, at
fixed percentages. For the five years ended December 31, 2003, the
Sub-Committee amended the MIP to change the method of computation and
allocation of the Award Bonus Pool and to provide for the participation by the
then three senior portfolio managers of the Company, and by Mr. Miller, at
fixed percentages.
The Amendment. For the two years ended December 31, 2003, subject to
stockholder approval, the Sub-Committee has amended the MIP due to the
resignation of Mr. Paul P. Tanico, Executive Vice President, to change the
method of allocation of the Award Bonus Pool to provide for the participation
by the current two senior portfolio managers of the Company, Messrs. Sosnoff
and Steinberg, and by the Company's Executive Vice President and Chief
Operating Officer, Mr. Miller. Messrs. Sosnoff and Steinberg will participate
at 40% each, and Mr. Miller will participate at 20%.
No other changes are being made to the MIP.
The Sub-Committee, with the concurrence of the Board of Directors,
has recommended that stockholders vote "FOR" the proposal to amend the
Management Incentive Plan.
17
PROPOSAL 3
APPOINTMENT OF AUDITORS
The Board of Directors, upon recommendation of the Audit Committee, has
appointed the firm of Rothstein, Kass & Company, P.C. as independent auditors
for the Company for 2002, subject to ratification by the stockholders. Arthur
Andersen LLP had served as the independent auditors for the Company since 1989.
The Audit Committee determined not to recommend the reappointment of Arthur
Andersen LLP based upon the Committee's concern about Arthur Andersen LLP's
exposure to civil and criminal liabilities. Arthur Andersen LLP's reports on the
Company's financial statements during this period have not contained any adverse
opinion or disclaimer of opinion or any qualification or modification of any
kind, nor have there been any disagreements with Arthur Andersen LLP on any
matter of accounting principles or practices, financial statement disclosure or
auditing scope or procedure.
Stockholder ratification of the selection of Rothstein, Kass &
Company, P.C. as the Company's independent auditors is not required by the
Company's Bylaws, Certificate of Incorporation or applicable law. However, the
Board of Directors is submitting the selection of Rothstein, Kass & Company,
P.C. to the stockholders for ratification as a matter of good corporate
governance and its own past practice. The engagement of Rothstein, Kass &
Company. P.C. is expected to commence as of the beginning of the Company's
2002 fiscal year.
For the fiscal year ended December 31, 2001, the aggregate fees
billed by Arthur Andersen LLP for professional services rendered for the audit
of the Company and its affiliates' annual financial statements and for the
reviews of the financial statements included in the Company's Quarterly
Reports on Form 10Q are shown below:
Services provided by Arthur Andersen LLP:
Audit and tax preparation work performed on behalf
of the Company $147,500
Additional audit and tax work performed on behalf
of unconsolidated affiliates of the Company
- Limited Partnerships (1) 77,500
- Investment companies (2) 43,200
------
Total services provided by Arthur Andersen LLP to the
Company and its unconsolidated affiliates $268,200
========
------------------------
(1) Refers to three limited partnerships which a subsidiary of the
Company manages as General Partner. For two of the partnerships,
the Company pays these fees directly, and in the other, the
partnership pays the fees directly.
(2) Refers to four mutual funds the Company created where its direct
and indirect wholly owned operating subsidiaries act as
Investment Advisor and Distributor, respectively. These fees are
paid by the mutual funds directly.
Arthur Andersen LLP did not provide any professional services to the
Company for information technology services relating to financial information
systems design and implementation for the fiscal year ended December 31, 2001.
A representative of Rothstein, Kass & Company, P.C., will be present
at the Annual Meeting and will be given an opportunity to make a statement if
he so desires and to respond to appropriate questions. A representative of
Arthur Andersen LLP will not be present at the Annual Meeting.
The Board of Directors recommends a vote "FOR" the proposal to ratify
the appointment of Rothstein, Kass & Company, P.C. as independent auditors.
18
STOCKHOLDER PROPOSALS
Any proposal to be presented at next year's Annual Meeting must be
received at the principal executive offices of the Company not later than
November 15, 2002 directed to the attention of the Secretary, for
consideration for inclusion in the Company's proxy statement and form of proxy
relating to that meeting. Any such proposal must comply in all respects with
the rules and regulations of the Securities and Exchange Commission.
OTHER MATTERS
The Board of Directors knows of no other matters that may come before
the meeting. If any matters other than those referred to above should properly
come before the meeting, it is the intention of the persons designated by the
Board to serve as proxies to vote such proxies in accordance with their best
judgment.
If any of the proposed nominees for election to the Board of
Directors should become unavailable to serve at or before the time of the
meeting, a substitute nominee or nominees may be chosen by the persons
authorized by the Board to vote the proxies.
By Order of the Board of Directors,
Anthony G. Miller
Secretary
19
ATALANTA/SOSNOFF CAPITAL CORPORATION
Proxy Solicited on Behalf of the Board of Directors of
P the Company for Annual Meeting May 9, 2002
R The undersigned hereby constitutes and appoints Martin T. Sosnoff, Craig B.
Steinberg and Anthony G. Miller, and each of them, his true and lawful
O agents and proxies with full power of substitution in each, to represent
the undersigned at the Annual Meeting of Stockholders of Atalanta/Sosnoff
X Capital Corporation, to be held at Bear, Stearns & Co., Inc., 383 Madison
Avenue, 13th Floor, New York, New York, on Thursday, May 9, 2002 and at any
Y adjournments thereof, on all matters coming before said meeting.
Election of Directors, Nominees:
Jay S. Goldsmith, Ronald H. Menaker, Martin T. Sosnoff, Craig B. Steinberg,
Thurston Twigg-Smith
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICE BY MARKING THE APPROPRIATE BOXES, SEE
REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES IF YOU WISH TO VOTE IN ACCORDANCE
WITH THE BOARD OF DIRECTOR'S RECOMMENDATIONS. THE PROXIES CANNOT VOTE YOUR
SHARES UNLESS YOU SIGN AND RETURN THIS CARD.
SEE REVERSE
SIDE
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ELECTION OF
DIRECTORS, FOR PROPOSAL 2, AND FOR PROPOSAL 3.
FOR WITHHELD
1. Election of Directors. [ ] [ ]
(see reverse)
For, except vote withheld for the following nominee(s):
FOR AGAINST ABSTAIN
2. Approval of Amendment to [ ] [ ] [ ]
Management Incentive Plan
FOR AGAINST ABSTAIN
3. Approval of independent accountants. [ ] [ ] [ ]
SIGNATURE(S) DATE
--------------------- -------
SIGNATURE(S) DATE
--------------------- -------
NOTE: Please sign exactly as name appears
hereon. Joint owners should each sign. When
signing as attorney, executor, administrator,
trustee or guardian, please give full title as
such.