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(e)(2)
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-12
INTERPLAY ENTERTAINMENT 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| No Fee Required
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction
applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
|_| Fee paid with preliminary materials:
|_| 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:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing party:
-----------------------------------------------------------------------
(4) Date filed:
-----------------------------------------------------------------------
INTERPLAY ENTERTAINMENT CORP.
-----------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
-----------------------------------------------------
TIME...................... 5:00 p.m. Pacific Time on June 30, 2008.
PLACE..................... Interplay Entertainment Corp.
100 North Crescent Drive
Beverly Hills, CA 90210
ITEMS OF BUSINESS......... (1) To approve an amendment to our
Restated Certificate of
Incorporation, as amended, to
decrease the minimum number of
directors from seven (7) to three
(3), effective as of the date on
which the number of directors first
fell below sever (7), with such
number being initially fixed at
three (3) and if Proposal 2 is
approved then such number shall be
fixed at five (5).
(2) Subject to the approval of Proposal
1, to elect five members of the
Board of Directors to serve until
the next annual stockholder
meeting.
(3) To amend our Amended and Restated
Certificate of Incorporation to
increase the number of authorized
shares of our Common Stock, par
value $0.001 per share, by
150,000,000 shares for a total
authorized amount of 300,000,000
shares of Common Stock.
(4) To transact such other business as
may properly come before the Annual
Meeting and any adjournment or
postponement.
RECORD DATE............... You can vote if, at the close of business on
May 14, 2008, you were a stockholder of the
Company.
PROXY VOTING.............. All stockholders are cordially invited to
attend the Annual Meeting in person.
However, to ensure your representation at
the Annual Meeting, you are urged to vote
promptly by signing and returning the
enclosed Proxy card.
May 20, 2008 /s/ Herve Caen
-----------------------------------------
Herve Caen
Chief Executive Officer and Interim Chief
Financial Officer
INTERPLAY ENTERTAINMENT CORP.
100 N. CRESCENT DRIVE BEVERLY HILLS, CALIFORNIA 90210
(310) 432-1958
PROXY STATEMENT
--------------------------------------------------------------------------------
These Proxy materials are delivered in connection with the solicitation by the
Board of Directors of Interplay Entertainment Corp., a Delaware corporation
("Interplay," the "Company", "we", or "us"), of Proxies to be voted at our 2008
Annual Meeting of Stockholders and at any adjournments or postponements thereof.
You are invited to attend our Annual Meeting of Stockholders on June 30, 2008,
beginning at 5:00 p.m. Pacific Time. The meeting will be held at Interplay
Entertainment Corp. office headquarters, 100 N. Crescent Drive, Beverly Hills,
California 90210.
Pursuant to the new rules recently adopted by the Securities and Exchange
Commission, we have elected to provide access to our proxy materials over the
Internet. Accordingly, we are sending on May 20, 2008 a Notice of Internet
Availability of Proxy Materials (the "Notice") to our stockholders of record and
beneficial owners. All stockholders will have the ability to access the proxy
materials on a website referred to in the Notice or request to receive a printed
set of the proxy materials. Instructions on how to access the proxy materials
over the Internet or to request a printed copy may be found on the Notice. In
addition, stockholders may request to receive proxy materials in printed form by
mail or electronically by email on an ongoing basis.
STOCKHOLDERS ENTITLED TO VOTE. Holders of our common stock at the close of
business on May 14, 2008 are entitled to vote their shares at the Annual
Meeting. Common stock is the only outstanding class of our securities entitled
to vote at the Annual Meeting. As of the close of business on May 14, 2008,
there were 103,855,634 shares of common stock outstanding, including 4,658,216
shares of Treasury Stock.
PROXIES. Your vote is important. If your shares are registered in your name, you
are a stockholder of record. If your shares are in the name of your broker or
bank, your shares are held in street name. We encourage you to vote by Proxy so
that your shares will be represented and voted at the meeting even if you cannot
attend. All stockholders can vote by Proxy card. Your submission of the Proxy
will not limit your right to vote at the Annual Meeting if you later decide to
attend in person. IF YOUR SHARES ARE HELD IN STREET NAME, YOU MUST OBTAIN A
PROXY, EXECUTED IN YOUR FAVOR, FROM THE HOLDER OF RECORD IN ORDER TO BE ABLE TO
VOTE AT THE meeting. If you are a stockholder of record, you may revoke your
Proxy at any time before the meeting either by filing with the Secretary of the
Company, at its principal executive offices, a written notice of revocation or a
duly executed Proxy bearing a later date, or by attending the Annual Meeting and
expressing a desire to vote your shares in person. All shares entitled to vote
and represented by properly executed Proxies received prior to the Annual
Meeting, and not revoked, will be voted at the Annual Meeting in accordance with
the instructions indicated on those Proxies. If no instructions are indicated on
a properly executed Proxy, the shares represented by that Proxy will be voted as
recommended by the Board of Directors.
QUORUM. The presence, in person or by Proxy, of a majority of the votes entitled
to be cast by the stockholders entitled to vote at the Annual Meeting is
necessary to constitute a quorum. Abstentions and broker non-votes will be
included in the number of shares present at the Annual Meeting for determining
the presence of a quorum. Broker non-votes occur when a broker holding customer
securities in street name has not received voting instructions from the customer
on certain non-routine matters and, therefore, is barred by the rules of the
applicable securities exchange from exercising discretionary authority to vote
those securities.
VOTING. Each share of our common stock is entitled to one vote on each matter
properly brought before the meeting. On the election of directors, our
stockholders have cumulative voting rights (please see "Election of Directors"
below for a description of your cumulative voting rights). Abstentions will be
counted toward the tabulation of votes cast on proposals submitted to
stockholders and will have the same effect as negative votes, while broker
non-votes will not be counted as votes cast for or against such matters.
PROXY SOLICITATION COSTS. The costs associated with the solicitation of
stockholder proxies by our Board in connection with this 2008 annual stockholder
meeting shall be borne by the Company.
AMENDMENTS TO THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION. The
approval of each of the amendments to our Amended and Restated Certificate of
Incorporation in Proposals 1 and 3 will require the affirmative vote of a
majority of the outstanding shares of common stock present, in person or by
proxy, at the Annual Meeting at which a quorum is present. For purposes of each
of the votes regarding amendment to the Certificate of Incorporation,
abstentions and broker non-votes will have the same effect as a vote against
approval of the amendment.
ELECTION OF DIRECTORS. The five nominees for director receiving the highest
number of votes at the Annual Meeting will be elected. If any nominee is unable
or unwilling to serve as a director at the time of the Annual Meeting, the
Proxies will be voted for such other nominee(s) as shall be designated by the
current Board of Directors to fill any vacancy. We have no reason to believe
that any nominee will be unable or unwilling to serve if elected as a director.
Our stockholders have cumulative voting rights when voting on the election of
directors. Cumulative voting rights entitle each stockholder to the number of
votes he or she would otherwise have in the absence of cumulative voting rights,
multiplied by the number of directors to be elected. Each stockholder may cast
all of the resulting votes for a single director, or may distribute them among
the directors to be elected at the stockholder's discretion. In order to
determine how many votes a stockholder is entitled to cast as a consequence of
cumulative voting rights, the stockholder multiplies the total number of shares
of our common stock owned by such stockholder by the number of directors being
elected, in this case five. The total that results is the number of votes the
stockholder may cast in the election of directors. The proxies solicited by the
Board of Directors confer discretionary authority on the proxy holders to
cumulate votes to elect the nominees listed in this Proxy Statement. The proxy
holder may cumulate votes to elect one or several directors as may be necessary
to elect the maximum number of nominees.
OTHER MATTERS. At the date this Proxy Statement went to press, we do not know of
any other matters to be raised at the Annual Meeting.
ITEM 1: AMENDMENT TO OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO
REDUCE THE MINIMUM NUMBER OF OUR DIRECTORS
--------------------------------------------------------------------------------
INTRODUCTION. The Board has unanimously approved, subject to stockholder
approval, an amendment to our Amended and Restated Certificate of Incorporation,
as amended ("the Director Reduction Amendment") that will decrease the minimum
number of directors from seven (7) to three (3). The Director Reduction
Amendment will be effective as of the date the number first fell below seven
(7). The specific of number of directors will initially will be fixed at three
(3) and if Proposal 2 is approved then such number shall be fixed at five (5).
The complete text of the form of the Director Reduction Amendment is set forth
as Appendix 1 to this Proxy Statement.
The Director Reduction Amendment has been recommended by our Board of Directors
because the Board has consisted for several years of only three directors and if
Proposal 2 is passed will consist of only five directors. While the Company has
been restructuring for the last few years it has not been in the best interests
of the Company to find new directors beyond the remaining three directors. Our
Board believes that reducing the required minimum and increasing the board size
to five directors is now appropriate for the Company.
If the Proposal is adopted, Article 5(a) of our Amended and Restated Certificate
of Incorporation, as amended, effective as of the date on which the number of
directors first fell below seven (7), will read as follows:
"ARTICLE 5
(a) The business and affairs of the Corporation shall be managed by or
under the direction of the Board of Directors and elections of directors need
not be by written ballot unless otherwise provided in the Bylaws. The number of
directors which shall constitute the whole Board of Directors of the Corporation
shall be between three (3) and nine (9), unless such minimum and/or maximum
number shall be changed by amendment to this Certificate of Incorporation. The
exact number of directors constituting the whole Board of Directors may be
changed from time to time by the Board of Directors, within the limits provided
above, in accordance with the Bylaws of the Corporation."
2
CERTAIN EFFECTS OF THE DIRECTOR REDUCTION AMENDMENT. The Board believes that
approval of this Proposal is essential. However, the following should be
considered by a stockholder in deciding how to vote upon this Proposal. The
Proposal, if approved, is intended to make valid the actions of the Board while
the Board has operated below the minimum number of seven directors and would
provide the Company with a Board size appropriate to the current operations of
the Company. The exact number of directors constituting the whole Board of
Directors will be initially fixed by the Board at three (3) and if Proposal 2 is
approved, will be fixed at five (5).
EFFECTIVENESS OF THE DIRECTOR REDUCTION AMENDMENT. If the Director Reduction
Amendment is approved by the requisite vote of our stockholders, the Director
Reduction Amendment will be effective as of the date on which the number of
directors first fell below seven and upon the date of filing and acceptance of
the Director Reduction Amendment with the Delaware Secretary of State, which
filing is expected to take place shortly after the Annual Meeting. If the
stockholders do not approve this Proposal, then the Director Reduction Amendment
will not be filed.
VOTE REQUIRED. The affirmative vote of a majority of the outstanding shares of
our common stock present, in person or by proxy, at the annual meeting at which
a quorum is present is required to approve the Director Reduction Amendment. For
purposes of the vote to amend the Amended and Restated Certificate of
Incorporation, as amended, abstentions and broker non-votes will have the same
effect as a vote against approval of the Director Reduction Amendment. All
proxies will be voted to approve the Director Reduction Amendment unless a
contrary vote is indicated on the enclosed proxy card.
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE PROPOSAL TO AMEND OUR AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION IN ORDER TO REDUCE THE MINIMUM NUMBER
OF OUR DIRECTORS.
ITEM 2: ELECTION OF DIRECTORS
--------------------------------------------------------------------------------
Item 2 is the election of five members of our Board of Directors. Our Board has
amended our Bylaws so that if Proposal 1 is approved, the Bylaws will provide
that the number of directors constituting the Board shall be between four and
nine, to be fixed by the Board from time to time. The Board has currently fixed
the number of directors at three, if Proposal 1 is approved, and five, if
Proposal 2 is approved.
Unless otherwise instructed, the Proxy holders will vote the Proxies received by
them for the nominees named below. If any nominee is unwilling to serve as a
director at the time of the Annual Meeting, the Proxies will be voted for such
other nominee(s) as shall be designated by the then current Board of Directors
to fill any vacancy. We have no reason to believe that any nominee will be
unable or unwilling to serve if elected as a director.
The Board of Directors proposes the election of the following nominee directors:
Herve Caen Eric Caen
Michel Welter Alberto Haddad
Xavier de Portal
If elected, the foregoing five nominees are expected to serve until the 2009
Annual Meeting of Stockholders. The five nominees for election as directors at
the Annual Meeting who receive the highest number of affirmative votes will be
elected.
The principal occupation and certain other information about the nominees and
the executive officers are set forth on the following pages.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ELECTION OF THE
NOMINEES LISTED ABOVE.
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following persons currently serve as our directors:
DIRECTORS AGE
--------- ---
Herve Caen 46
Eric Caen 42
Michel Welter 49
3
The Board of Directors has nominated Alberto Haddad and Xavier de Portal for
election to the Board of Directors. If elected, Alberto Haddad will serve on the
independent and compensation committees. If elected, Xavier de Portal will serve
on the independent, audit and compensation committees. Alberto Haddad is 44
years old and Xavier de Portal is 57 years old. Each of the nominees to the
Board of Directors has indicated their willingness to serve and, unless
otherwise instructed, the proxy holders will vote the proxy received by them for
those five nominees.
The following persons serve as our executive officers:
EXECUTIVE OFFICERS AGE TITLE
------------------ --- -----
Herve Caen 46 Chairman of the Board, Chief Executive
Officer and interim Chief Financial
Officer
Our executive officers are appointed by and serve at the discretion of our board
of directors. Herve Caen and Eric Caen are brothers. There are no other family
relationships between any director and/or any executive officer.
HERVE CAEN has been our Chief Executive Officer and Interim Chief Financial
Officer since 2002. Mr. Caen has served as Chairman of our Board of Directors
since 2001. Mr. Caen joined us as President and Director in 1999. Mr. Caen
served as Chairman of the Board of Directors of Titus Interactive S.A., an
interactive entertainment software company (placed in involuntary bankruptcy in
January, 2005 and previously the parent of the Company) between 1991 and 2005.
Mr. Caen also held various executive positions within the Titus group between
1985 and 2005.
ERIC CAEN has served as a director since 1999. He is the Chief Executive Officer
of Glow Entertainment Group. a video rental and video on demand provider
operating in France and Germany. He was a Director of Titus Interactive S.A., an
interactive entertainment software company between 1991 and 2005. Mr. Caen also
held various executive positions within the Titus group between 1985 and 2005.
MICHEL WELTER has served as a director since 2001, and has been the sole
independent director since 2004. He has been involved in the trading and
exploitation of animated TV series through his company Weltertainment since
2002. From 2000 to 2001 he served as President of CineGroupe International, a
Canadian company, which develops, produces and distributes animated television
series and movies. From 1990 to the end of 2000, Mr. Welter served as President
of Saban Enterprises where he launched the international merchandising for the
hit series "Power Rangers" and was in charge of international business
development where he put together numerous co-productions with companies in
Europe and Asia.
NEW DIRECTOR NOMINEES
ALBERTO HADDAD has been a partner resident in the Boston office of Melcion,
Chassagne & Company since 2002, a Paris, France based investment bank. He
advises entrepreneurs and supports them in the development of their projects
over their lifetime. He is a member of the board of the French-American Chamber
of Commerce in New England and is a Foreign Trade advisor of the French
government in New England. He also serves on advisory boards of various other
non-profit organizations. Before 2003 he ran his own advisory company,
Technology Square Partners, and acted as the CEO-US for France-based Startup
Avenue. Previously he held management positions at McKinsey and Eastman Kodak.
He holds a Msc (MBA) from MIT Sloan, a "diplome" in international business and
Finance (Ecofi) from the Institut d'Etudes Politiques de Paris in France and a
B.A. in Economics from the American University of Beirut.
XAVIER DE PORTAL has been a corporate finance consultant based in Paris, France
since 1991. He assists companies, both private and public, in addressing
financing needs in relation to their organic growth and/or acquisitions. From
2001 to 2004 he also served as CEO of Next Music. He also served in CEO and CFO
positions in press, music and video game companies in various stages of
development between 1991 and 2001. Prior to 1991, he was the development
director of a large retail bank in France. He holds a Doctorate Degree in
European Law, a "diplome" in international business and Finance (Ecofi) from the
Institut d'Etudes Politiques de Paris in France and a "diplome" of the European
Community from Pantheon, Paris.
4
FURTHER INFORMATION CONCERNING THE BOARD OF DIRECTORS
MEETINGS AND COMMITTEES. The Board of Directors held one meeting during fiscal
year 2007. The Board of Directors has an Independent Committee, Audit Committee
and a Compensation Committee. While we only have a limited number of Directors,
the full Board of Directors performs the functions of a Nominating Committee.
Mr. Welter is the sole Independent Director under Nasdaq and SEC rules.
The Independent Committee currently consists of Mr. Welter. The Independent
Committee reviews Related Persons Transactions. Mr. Welter acted as the
Independent Committee once during fiscal year 2007. (If elected we expect Mr.
Haddad and Mr. de Portal to join the Independent Committee.)
The Audit Committee currently consists of Mr. Welter. We do not have an Audit
Committee financial expert because we only have a limited number of Directors.
(If elected we expect Mr. de Portal to join the Audit Committee and become our
Audit Committee financial expert.) The Audit Committee recommends the engagement
of our independent public accountant currently Jeffrey S. Gilbert C.P.A.,
reviews the scope of the audit to be conducted by the independent public
accountant, and periodically meets with the independent public accountant, our
Interim Chief Financial Officer and Controller to review matters relating to our
financial statements, our accounting principles and system of internal
accounting controls, and reports its recommendations as to the approval of our
financial statements to the Board of Directors. The role and responsibilities of
the Audit Committee are more fully set forth in a written charter adopted by the
Board of Directors , a copy of which is set forth in Appendix 2. Mr. Welter
acted as the Audit Committee once during fiscal year 2007.
The Compensation Committee currently consists of Mr. Welter. The Compensation
Committee is responsible for considering and making recommendations to the Board
of Directors regarding executive compensation and, is responsible for
administering our stock option and executive incentive compensation plans. Mr.
Welter acted as the Compensation Committee once during fiscal year 2007.
While the Compensation Committee has had only one member, the Compensation
Committee has not had a written charter. (If elected we expect Mr. Haddad and
Mr. de Portal to join the Compensation Committee, and we intend subsequently to
reconsider whether to have a written charter.) Mr. Herve Caen recommended to
Mr.Welter the compensation arrangements for our officers and our Board of
Directors, and Mr. Welter considered and approved such arrangements after
determining them to be in the best interest of our stockholders.
All incumbent directors attended 100% of the meeting(s) of the Board of
Directors in 2007. It is our policy that all Board members attend our Annual
Meeting, if practicable. No Annual Meeting was held in 2007. Mr. Herve Caen
recommended Mr. Haddad and Mr. de Portal to the Board of Directors for
nomination. The Board of Directors does not have a policy with regard to the
consideration of director candidates recommended by our stockholders, because we
only have a limited number of directors.
Essential criteria for all director candidates include the following:
o integrity and ethical behavior;
o maturity;
o management experience and expertise;
o independence and diversity of thought;
o broad business or professional experience; and
o an understanding of business and financial affairs, and the
complexities of business organizations.
Also we expect our directors to have substantive knowledge of or be experienced
in interactive entertainment.
Our Bylaws provide that any stockholder, if beneficially owning (as defined by
rule 13d-3 of the Securities Exchange Act of 1934, as amended) of record at
least one percent (1%) of the issued and outstanding capital stock of the
corporation, may nominate candidates for election to the Board of Directors. To
be timely, a stockholder's notice (which shall only be required with respect to
a special meeting of stockholders) shall be delivered to or mailed and received
5
at the principal executive offices of the corporation not less than 45 days nor
more than 90 days prior to the meeting; provided, however, that in the event
that less than 55 days' notice or prior public disclosure of the date of the
meeting is given or made to stockholders, notice by the stockholder to be timely
must be so received not later than the close of business on the 10th day
following the date on which such notice of the date of the meeting was mailed or
such public disclosure was made. Such stockholder's notice (which shall only be
required with respect to a special meeting of stockholders) shall set forth (A)
as to each person whom the stockholder proposes to nominate for election or
reelection as a director, (i) the name, age, business address and residence
address of such person, (ii) the principal occupation or employment of such
person, (iii) the class and number of shares of the capital stock of the
corporation which are beneficially owned by such person and (iv) any other
information relating to such person that would be required to be disclosed in
solicitations of proxies for election of directors, or would be otherwise
required, in each case pursuant to Regulation 14A promulgated under the
Securities Exchange Act of 1934, as amended (including without limitation such
person's written consent to being named in the proxy statement as a nominee and
to serving as a director if elected); and (B) as to the stockholder giving the
notice (i) the name and address of such stockholder and (ii) the class and
number of shares of the capital stock of the corporation which are beneficially
owned (as defined by Rule 13d-3 of the Securities Exchange Act of 1934, as
amended) by such stockholder. If requested in writing by the Secretary at least
15 days in advance of the annual meeting, a stockholder whose shares are not
registered in the name of such stockholder on the corporation's books shall
provide the Secretary, within ten days of such request, with documentary support
for such claim of beneficial ownership.
DIRECTORS' COMPENSATION. Currently, we pay each of our non-employee directors
compensation as follows:
o $5,000 in cash compensation per quarter for attendance at
Board of Directors meetings. All cash compensation was
suspended for the period September 30, 2006 through September
30,2007.
o $5,000 in cash compensation per annum for each Board committee
a director is a member of and participated in. All cash
compensation was suspended for the period September 30, 2006
through September 30, 2007.
o Upon election and appointment to the Board, or upon loss of
employee status of an employee director, an option to purchase
up to 25,000 shares of the Company's common stock under the
Company's Third Amended and Restated 1997 Stock Incentive
Plan. These director options are each for a term of ten years
and vest over the first three years. This program was
suspended and did not apply during fiscal year 2007.
o An option to purchase 5,000 shares of the Company's common
stock under the Company's Third Amended and Restated 1997
Stock Incentive Plan for each subsequent year of director
service. These director options are each for a term of ten
years and vest over the first three years. This program was
suspended and did not apply during fiscal year 2007.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION.
The Compensation Committee currently consists of Michel Welter. During 2007,
decisions regarding executive compensation were made by the Compensation
Committee. None of the 2007 member of the Compensation Committee nor any of our
2007 executive officers or directors had a relationship that would constitute an
interlocking relationship with executive officers and directors of another
entity.
STOCKHOLDER COMMUNICATIONS WITH DIRECTORS
You may communicate with our Board of Directors or Mr. Welter, by writing to
such persons c/o Herve Caen, Secretary, at 100 N. Crescent Drive Suite 324,
Beverly Hills, California 90210.
Mr. Caen distributes communications to the Board of Directors or to any
individual director or directors, as appropriate, depending on the facts and
circumstances outlined in the communication. In that regard, the Board of
Directors has requested that certain items that are unrelated to the duties and
responsibilities of the Board of Directors should be excluded, such as the
following:
6
o junk mail and mass mailings,
o product complaints,
o product inquiries,
o new product suggestions,
o resumes and other forms of job inquiries,
o surveys, and
o business solicitations or advertisements.
In addition, material that is unduly hostile, threatening, illegal or similarly
unsuitable will be excluded, with the provision that any communication that is
excluded must be made available to any outside director upon request.
ITEM 3: AMENDMENT TO OUR AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO
INCREASE THE NUMBER OF AUTHORIZED SHARES OF OUR COMMON STOCK
--------------------------------------------------------------------------------
INTRODUCTION. The Board has unanimously approved, subject to stockholder
approval, an amendment to our Amended and Restated Certificate of Incorporation,
as amended (the "Authorized Share Increase Amendment"), that will increase the
aggregate number of shares of common stock authorized for issuance from
150,000,000 shares to 300,000,000 (the "Authorized Share Increase"). The
complete text of the form of the Authorized Share Increase Amendment is set
forth as Appendix 3 to this Proxy Statement.
Although we have not currently entered into any agreements, nor do we currently
have any plans, to issue any of the additional shares to be available upon the
effectiveness of the Authorized Share Increase, the proposed increase in the
number of authorized shares of common stock has been recommended by the Board to
assure that an adequate supply of authorized but unissued shares is available
for use primarily in connection with raising additional capital for operations
and the issuance of shares under our third Amended and Restated 1997 Stock
Incentive Plan (the "1997 Plan").
If the Proposal is adopted, the first full sentence of Article 4 of our Amended
and Restated Certificate of Incorporation, as amended, will read as follows:
"Article 4
The total number of shares of all classes of stock which this
Corporation shall have authority to issue is 305,000,000, of which (i)
300,000,000 shares shall be designated "Common Stock" and shall have a
par value of $0.001 per share; and (ii) 5,000,000 shares shall be
designated "Preferred Stock" and shall have a par value of $0.001 per
share."
CERTAIN EFFECTS OF THE AUTHORIZED SHARE INCREASE AMENDMENT. The Board believes
that approval of the Proposal is essential for our growth and development.
However, the following should be considered by a stockholder in deciding how to
vote upon this Proposal. The Proposal, if approved, would strengthen the
position of the Board and might make the removal of the Board more difficult,
even if the removal would be generally beneficial to our stockholders. Once the
stockholders approve an increase in the Company's authorized shares of common
stock, the Board will have the authorization to issue the additional shares of
common stock. The Board's ability to issue additional shares of common stock may
provide the Board with a capacity to negate the efforts of unfriendly tender
offerors through the issuance of securities to others who are friendly or
desirable to the Board. The additional shares which the Board would be
authorized to issue upon approval of the Proposal, if so issued, would have a
dilutive effect upon the percentage of our equity owned by present stockholders.
The issuance of the additional shares might be disadvantageous to current
stockholders in that any additional issuances would potentially reduce per share
dividends, if any. Stockholders should consider, however, that the possible
impact upon dividends is likely to be minimal in view of the fact that we have
never paid dividends on shares of our common stock and we do not intend to pay
any cash dividends in the foreseeable future. We instead intend to retain
earnings, if any, for investment and use in business operations.
EFFECTIVENESS OF THE AUTHORIZED SHARE INCREASE. If the Authorized Share Increase
Amendment is approved by the requisite vote of our stockholders, the Authorized
Share Increase will be effective upon the date of filing and acceptance of the
7
Authorized Share Increase Amendment with the Delaware Secretary of State, which
filing is expected to take place shortly after the Annual Meeting. However, the
exact timing of the filing of the Authorized Share Increase Amendment will be
determined by the Board based upon its evaluation as to when such action will be
most advantageous to us and our stockholders, and the Board reserves the right
to delay filing the Authorized Share Increase Amendment for up to twelve months
following stockholder approval thereof. In addition, the Board reserves the
right, notwithstanding stockholder approval and without further action by the
stockholders, to elect not to proceed with the Authorized Share Increase
Amendment if, at any time prior to filing the Authorized Share Increase
Amendment, the Board, in its sole discretion, determines that it is no longer in
our best interests or in the best interests of our stockholders. If the
stockholders do not approve this proposal, then the Authorized Share Increase
Amendment will not be filed.
VOTE REQUIRED. The affirmative vote of a majority of the outstanding shares of
our common stock present, in person or by proxy, at the annual meeting at which
a quorum is present is required to approve the Authorized Share Increase
Amendment. For purposes of the vote to amend the Amended and Restated
Certificate of Incorporation, as amended, abstentions and broker non-votes will
have the same effect as a vote against approval of the Authorized Share Increase
Amendment. All proxies will be voted to approve the Authorized Share Increase
Amendment unless a contrary vote is indicated on the enclosed proxy card.
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE PROPOSAL TO AMEND OUR AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION IN ORDER TO INCREASE THE NUMBER OF
AUTHORIZED SHARES OF OUR COMMON STOCK.
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT
The Compensation Committee has reviewed and discussed with management the
following Compensation Discussion and Analysis. Based on its review and
discussions with management, the Compensation Committee recommended to the Board
of Directors that the Compensation Discussion and Analysis be included in our
Proxy Statement for 2008.
THE COMPENSATION COMMITTEE
Michel Welter
COMPENSATION DISCUSSION AND ANALYSIS
The following Compensation Discussion and Analysis describes the material
elements of compensation for our executive officer of Interplay identified in
the Summary Compensation Table (our "Named Executive Officer"). The Compensation
Committee of the Board of Directors (the "Committee") makes all decisions for
the total direct compensation -- that is, the base salary, annual bonus,
long-term equity compensation and perquisites -- of our officers, including the
Named Executive Officer.
OUR BUSINESS ENVIRONMENT
Our Mission. We are a publisher and licensor of interactive entertainment
software for both core gamers and the mass market. We are most widely known for
our titles in the action/arcade, adventure/role playing game (RPG), and
strategy/puzzle categories. We have produced and licensed titles for many of the
most popular interactive entertainment software platforms. We seek to publish or
license out interactive entertainment software titles that are, or have the
potential to become, franchise software titles that can be leveraged across
several releases and/or platforms, and have published or licensed many such
successful franchise titles to date. We are committed to developing and
delivering quality game experience for gamers around the world! As to our
officers and employees, our mission is to create an environment that is open,
honest and entrepreneurial, where each is challenged to reach his or her full
potential.
Our Values. Each of our employees is required to promote honest and ethical
conduct both within our organization and in our relations with customers or
business partners.
8
COMPENSATION PROGRAM OBJECTIVES AND REWARDS
Compensation Philosophy. In determining the compensation for an executive
officer, we have the following objectives:
o To attract and retain officers by maintaining competitive
compensation packages;
o To motivate officers to achieve and maintain superior
performance levels;
o To achieve a lean and flexible business model by rewarding
executives who are versatile and capable across multiple
business functions; and
o To support overall business objectives designed to increase
returns to our stockholders.
We measure the success of our compensation programs by the following:
o The overall performance of our business and the engagement of
our officers in improving performance;
o Our ability to attract and retain key talent; and
o The perception of employees that dedication, skill and focus
on success of the enterprise will be rewarded. We generally
seek to pay officers total compensation competitive with that
paid to officers of other companies of similar size in our
industry.
All of the compensation and benefits for our officers serve the primary purpose
of attracting, retaining and motivating the highly talented individuals who
perform the work necessary for us to succeed in our mission while upholding our
values in a highly competitive marketplace. Beyond that, we design different
elements of compensation to promote individually tailored goals.
PERFORMANCE AGAINST OBJECTIVES
A substantial percentage of officer compensation, including for the Named
Executive Officer, depends on the officer's achievement of individual
objectives. We generally establish these objectives early in the fiscal year.
The Committee confers with the CEO to establish his objectives, and the
Committee also measures performance against objectives. For other officers, the
CEO confers with the executive then submits proposed objectives to the
Committee. In designing objectives, the Committee and the CEO seek to fulfill
our strategic plan while promoting the individual's professional development.
Objectives may include financial objectives, such as sales targets or cost
reduction, as well as qualitative factors such as leadership, management
development, and the quality of execution of business strategies that drive the
growth of our business. As soon as practicable after the end of the year,
supervisors measure performance against objectives. For officers, the CEO
conducts this evaluation and reports to the Committee.
ELEMENTS OF COMPENSATION
The elements of compensation that may be paid to our officers include base
salary and equity compensation.
Base Salaries. We generally negotiate base salaries at a level necessary to
attract and retain the talent we need to execute our plans. The Committee
considers such factors as its subjective assessment of the executive's scope of
responsibility, level of experience, individual performance, and past and
potential contribution to our business. From time to time the Committee will
seek market data compiled by compensation consultants, but generally does not
rely on such data.
The Committee determines base salaries for officers, including the Named
Executive Officer, early each year. For officers other than himself, the CEO
proposes any change in base salary based on:
o his evaluation of individual performance and expected future
contributions;
9
o the general development of our business;
o a review of survey data when deemed necessary, and
o comparison of the base salaries of the officers who report
directly to the CEO to provide for internal equity.
In October 2006 the Company reduced the base salary of Herve Caen, our CEO and
interim CFO, from $460,000 to $250,000 through September, 2007 and as of October
1, 2007 his salary reverted to $460,000 per year.
Annual Cash Bonuses. The Committee has exclusive discretion to award bonuses to
our officers, including our Named Executive Officer, as an incentive for
employee productivity and effectiveness over the course of each fiscal year. The
CEO recommends executive bonuses to the Committee. The Committee decides based
on achievement of performance objectives and a subjective analysis of the
executive's level of responsibility. The Compensation Committee also considers
other types and amounts of compensation that may be paid to the executive.
The Committee determines bonuses in part based on our achievement of corporate
goals such as revenue and net income results versus the prior year and our
performance relative to our industry, as well as the performance of the
individual against preset personal objectives.
Bonuses to Named Executive Officer. Annual bonuses for executives and other key
employees are tied directly to the Company's financial performance as well as
individual performance. The purpose of annual cash bonuses is to reward
executives for achievements of corporate, financial and operational goals.
Annual cash bonuses are intended to reward the achievement of outstanding
performance. If certain objective and subjective performance goals are not met,
annual bonuses are reduced or not paid. No bonus was paid to any employee in
fiscal year 2007, including the Named Executive Officer.
Equity Compensation. The Committee believes that long-term equity incentive
awards serve to align the interests of the officers with the interests of our
stockholders. In 2006 we made awards of warrants and options to the Named
Executive Officer and our other board members as part of restructuring of
certain compensatory arrangements. Although we made no further awards during
2007, we do intend in the future to make awards under our stock plan for
employees, officers and directors, our 1997 Plan.
The purpose of the 1997 Plan is to create an opportunity for executives and
other key employees to share in the enhancement of stockholder value through
stock options. The overall goal of this component of pay is to create a strong
link between our management and our stockholders through management stock
ownership and the achievement of specific corporate financial measures that
result in the appreciation of our share price. The Compensation Committee
generally has followed the practice of granting options on terms that provide
that the options become exercisable in installments over a two to five year
period. The Compensation Committee believes that this feature not only provides
an employee retention factor but also makes longer-term growth in share prices
important for those receiving options.
No Stock options were granted to our officers in 2007. The Compensation
Committee continues to review the desirability of issuing stock options to our
officers in any given fiscal year to provide incentives in connection with our
corporate objectives. Stock options become valuable if the price of our common
stock rises after we grant the options. The Committee sets the exercise price of
a stock option on the date of grant at fair market value, which is generally the
closing price of our common stock on the over-the-counter market bulletin board
on that date. Under the 1997 Plan, we may not grant stock options having an
exercise price below fair market value of our common stock on the date of grant.
To encourage retention by providing a long-term incentive, the ability to
exercise an option may vest over a period of three or five years. We do not
backdate options or grant options retroactively.
Awards in 2007. During fiscal year 2007, the Board of Directors granted no
options or warrants to officers or directors, including the Named Executive
Officer.
Change in Control Arrangements. All of the warrants and options held by the
Named Executive Officer and other employees have already vested.
Perquisites. No perquisites are provided to our officers.
10
Benefits. Our officers, including the Named Executive Officer, participate in a
variety of health and welfare, and paid time-off benefits designed to enable us
to attract and retain our workforce in a competitive marketplace.
Policy under Section 162(m) of the Internal Revenue Code. We have not formulated
a policy for qualifying compensation paid to executive officers for
deductibility under Section 162(m) of the Internal Revenue Code, and do not
foresee the necessity of doing so in the near future. Should limitations on the
deductibility of compensation become a material issue, the Compensation
Committee will determine whether such a policy should be implemented, either in
general or with respect to specific transactions.
SUMMARY COMPENSATION
The following table summarizes the compensation of the Named Executive Officer
for the fiscal year ended December 31, 2007. The Named Executive Officer is the
Chief Executive Officer and Interim Chief Financial Officer. There are no other
executive officers of the Company.
STOCK OPTION ALL OTHER
SALARY BONUS AWARDS AWARDS COMPENSATION TOTAL
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) ($) ($) ($)
-------------------------------- ------------ -------- ----------- -------- -------- ------------ ----------
Herve Caen 2007 (1)(2)(3) 565,000 -- -- -- 5,000 570,000
Herve Caen 2006 (1)(4)(5) 407,500 -- -- -- 15,000 422,500
Chief Executive Officer and
Interim Chief Financial
Officer
(1) In October 2006, our Compensation Committee approved a reduction in Mr.
Caen's annual base salary from $460,000 as Chief Executive Officer and
Interim Chief Financial Officer to $250,000 per annum through
September, 2007. Mr. Caen's annual base salary reverted to $460,000 as
of October 1, 2007. Mr. Caen received warrants and options as part of
restructuring his compensatory arrangements in 2006 (see outstanding
equity awards information below).
(2) Of $565,000 paid during 2007, $302,000 was paid as compensation earned
in 2007, and $180,000 and $83,000 were paid respectively as
compensation earned but previously unpaid in 2006 and 2005.
(3) $5,000 was accrued as director's fees but was not paid.
(4) Of $407,500 accrued during 2006, only $249,167 was paid during 2006 to
Mr. Caen.
(5) $15,000 was accrued during 2006 as director's fees but was not paid.
GRANTS OF PLAN BASED AWARDS
FOR FISCAL YEAR ENDED
DECEMBER 31, 2007
The following table provides information on stock options and warrants
granted in 2007 to our Named Executive Officer. By providing the Grant Date Fair
Value of Awards in the table we do not imply any assurance that such values will
ever be realized.
ALL OTHER
OPTION AND WARRANT
ALL OTHER AWARDS: EXERCISE OR
STOCK AWARDS: NUMBER OF BASE PRICE OF
NUMBER OF SECURITIES OPTION AND CLOSING GRANT DATE
SHARES OF UNDERLYING WARRANT PRICE ON FAIR VALUE
APPROVAL STOCK OR UNITS OPTIONS AWARDS GRANT DATE OF AWARDS
NAME GRANT DATE DATE (#) (#) ($/SH) ($/SH) ($)(1)
--------------- ---------- ---------- -------------- ------------------ ------------- ------------- -------------
-- -- -- -- -- -- --
(1) No Awards were made in fiscal year 2007.
11
OUTSTANDING EQUITY AWARDS
AT FISCAL YEAR-ENDED
DECEMBER 31, 2007
The following table shows the number of shares covered by exercisable and
unexercisable options and warrants held by our Named Executive Officer on
December 31 2007. No other equity awards have been made to our Named Executive
Officer.
NUMBER OF NUMBER OF
SECURITIES SECURITIES
UNDERLYING UNDERLYING
UNEXERCISED UNEXERCISED OPTION OR OPTION OR
OPTIONS OR OPTIONS OR WARRANT WARRANT
WARRANTS WARRANTS EXERCISE EXPIRATION
EXERCISABLE UNEXERCISABLE PRICE ($) DATE
------------- ------------- ------------- -------------
Herve Caen 6,120,000 -- (1)(2)(3) .0279 10/02/2016
(1) 100% of the securities vested on October 2, 2006.
(2) Pricing was determined over an average closing price over ten days
subsequent to the resolution authorizing the issuance of the options
and warrants to the Named Executive Officer.
(3) The 6,100,000 warrants were issued to the officer to reduce his
compensation and to convert a portion of his unpaid Tompensation into a
conditional demand note. The 20,000 options were granted as directors'
fees.
OPTION EXERCISES AND STOCK VESTED AS OF
FISCAL YEAR-ENDED DECEMBER 31, 2007
The table below shows the number of shares of our common stock acquired by the
Named Executive Officer during 2007 on the exercise of options and warrants. No
stock awards to the Named Executive Officer vested in 2007.
OPTION AWARDS
-----------------------------------------
NUMBER OF SHARES VALUE REALIZED
ACQUIRED ON EXERCISE ON EXERCISE
NAME (#) ($)
----------------------- -------------------- ----------------
0 0
2007 DIRECTOR COMPENSATION
The chart below summarizes remuneration paid to non-employee directors during
2007 in the form of cash or stock option awards or warrants. The value shown for
stock options or warrants is the dollar amount we recognized for financial
statement reporting purposes in 2007 in accordance with FAS 123R.
FEES EARNED OR WARRANTS OR ALL OTHER
PAID IN CASH OPTION AWARDS COMPENSATION TOTAL
NAME ($) ($) ($) ($)
------------------ -------------- ------------- ------------ -----------
Eric Caen ........ 5,000 -- -- 5,000
Michel Welter (1) 8,750 -- -- 8,750
(1) Included in the fees earned by Michel Welter are compensation for his
services on the Audit, Compensation and Independent Committees.
12
EMPLOYMENT AGREEMENTS
Mr. Herve Caen currently serves as our Chief Executive Officer and interim Chief
Financial Officer. We previously entered into an employment agreement with Mr.
Herve Caen for a term of three years through November 2002, pursuant to which he
currently serves as our Chairman of the Board of Directors and Chief Executive
Officer. The employment agreement provided for an annual base salary of $250,000
(subsequently increased to $460,000), with such annual raises as may be approved
by the Board of Directors, plus annual bonuses at the discretion of the Board of
Directors. In October 2006 the Company reduced the base salary of Mr. Caen from
$460,000 to $250,000 and as of October 1, 2007 his salary reverted to $460,000
per year. Mr. Caen is also entitled to participate in the incentive compensation
and other employee benefit plans established by us from time to time.
EQUITY COMPENSATION PLAN INFORMATION
WHENEVER WE USE A GENERAL STATEMENT TO INCORPORATE THIS PROXY STATEMENT BY
REFERENCE INTO ANOTHER OF OUR DOCUMENTS FILED WITH THE SEC, THE FOLLOWING TABLE
IS EXCLUDED. THE FOLLOWING TABLE WILL NOT BE DEEMED FILED UNDER THE SECURITIES
ACT OR THE EXCHANGE ACT UNLESS WE EXPLICITLY INCORPORATE IT BY REFERENCE IN SUCH
A FILING.
The following table summarizes information about the options and other equity
compensation under our equity plans as of the close of business on December 31,
2007.
NUMBER OF SECURITIES
REMAINING AVAILABLE
NUMBER OF SECURITIES FOR FUTURE ISSUANCE
TO BE ISSUED UPON UNDER EQUITY
EXERCISE OF COMPENSATION PLANS
OUTSTANDING OPTIONS, WEIGHTED AVERAGE (EXCLUDING SECURITIES
WARRANTS AND RIGHTS (#) EXERCISE PRICE ($) REFLECTED IN COLUMN (a))
PLAN CATEGORY (a) (b) (#)(c)
------------------------ ------------------------ ------------------------
Equity Compensation Plans
Approved by Stockholders ... 1,410,000 (1) 0.044 8,590,000
Equity Compensation Plans
Not Approved by Stockholders 7,330,298 (2) 0.38 0
------------------------ ------------------------
TOTAL ...................... 8,740,298 8,590,000
======================== ========================
(1) The Company has one stock option plan currently outstanding. Under the
1997 Stock Incentive Plan, as amended (the "1997 Plan"), the Company
may grant options to its employees, consultants and directors, which
generally vest from three to five years. At the Company's 2002 annual
stockholders' meeting, its stockholders voted to approve an amendment
to the 1997 Plan to increase the number of authorized shares of common
stock available for issuance under the 1997 Plan from four million to
10 million. The Company's Incentive Stock Option, Nonqualified Stock
Option and Restricted Stock Purchase Plan- 1991, as amended (the "1991
Plan"), and the Company's Incentive Stock Option and Nonqualified Stock
Option Plan-1994, as amended, (the "1994 Plan"), have been terminated.
(2) During fiscal year 2006, the Board of Directors granted to the Named
Executive Officer 6,100,000 warrants to Durchase the Company's common
stock at an immediately exercisable exercise price of $.0279 per share
paverage closing price over ten days prior to the resolution
authorizing the issuance of the warrants). 170,000 warrants were issued
to Mr. Welter and 100,000 were issued to Eric Caen each at the same
exercise price as the Named Executive Officer. The remaining 960,298
warrants were issued in prior years to persons pot currently affiliated
with us. n
13
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Independent Committee currently consists of Mr. Welter. The Independent
Committee reviews Related Persons transactions. Mr. Welter did not act as the
Independent Committee during 2007 because the Company did not enter into any
Related Person transactions during 2007.
REVIEW OF RELATED PERSON TRANSACTIONS
The Board of Directors has adopted a written Related Person Transaction Policy,
which requires the approval of the Independent Committee for all covered
transactions. The Policy applies to any transaction or series of transactions in
which Interplay or a subsidiary is a participant, and a "Related Person" as
defined in the Policy, including executive officers, directors and their
immediate family members, has a direct or indirect material interest. Under the
Policy, all Related Person Transactions must be submitted to the Independent
Committee for review, approval, ratification or other action. Based on its
consideration of all of the relevant facts and circumstances, and full
disclosure of the Related Person's interest in the transaction, the Independent
Committee will decide whether or not to approve the transaction and will approve
only those transactions that are in the best interests of the Company.
CODE OF ETHICS
We have adopted a Code of Ethics for all of our employees, including our
principal executive officer, principal financial officer, principal accounting
officer or controller and any person performing similar functions. The Code of
Ethics was filed as an exhibit to the Amendment No. 1 to the 10-K for the period
ended December 31, 2003.
REPORT OF THE AUDIT COMMITTEE
IN ANY OF OUR FILINGS UNDER THE SECURITIES ACT OR EXCHANGE ACT THAT INCORPORATE
THIS PROXY STATEMENT BY REFERENCE, THE REPORT OF THE AUDIT COMMITTEE OF THE
BOARD OF DIRECTORS WILL BE CONSIDERED EXCLUDED FROM THE INCORPORATION BY
REFERENCE, AND IT WILL NOT BE DEEMED A PART OF ANY SUCH OTHER FILING UNLESS WE
EXPRESSLY STATE THAT THE REPORT IS SO INCORPORATED.
The Audit Committee of the Board of Directors is currently composed of one
director who is an independent director as defined under NASDAQ and SEC rules.
The Audit Committee operates under a written charter adopted by the Board of
Directors.
The Audit Committee oversees Interplay's financial reporting process on behalf
of the Board of Directors. Management is responsible for Interplay's financial
statements and the financial reporting process, including the system of internal
controls. The independent registered public accounting firm is responsible for
expressing an opinion on whether Interplay's financial statements fairly
present, in all material respects, Interplay's financial position and results of
operations and conform with generally accepted accounting principles. In
fulfilling its oversight responsibilities, the Audit Committee has reviewed and
discussed with management and the independent registered public accounting firm
the audited financial statements that have been included in our Annual Report on
Form 10-K for the year ended December 31, 2007.
The Audit Committee has discussed with the independent registered public
accounting firm the matters required to be discussed by Statement on Auditing
Standards No. 61, Communication with Audit Committees, as amended. In addition,
the Audit Committee has reviewed with the independent registered public
accounting firm their independence from Interplay and its management including
the written disclosures and the letter provided to the Audit Committee as
required by Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committees. The Audit Committee reviewed and discussed
Company policies with respect to risk assessment and risk management.
Based on the review and discussions referred to above, the Audit Committee
recommended to the Board of Directors, and the Board of Directors has approved,
the inclusion of the audited financial statements in the Annual Report on Form
10-K for the 2007 fiscal year for filing with the SEC. The Audit Committee has
recommended and the Board of Directors has approved and authorized engagement of
Jeffrey S. Gilbert C.P.A. as our independent registered public accounting firm
for the fiscal year ending December 31, 2008.
The Audit Committee
Michel Welter
Dated May 20, 2008
14
PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following table summarizes the aggregate fees for professional services
provided by Jeffrey S. Gilbert C.P.A. related to fiscal 2006 and fiscal 2007:
2006 2007
-------- --------
Audit Fees(1) ........................................ $ 59,000 $ 62,000
Audit-related Fees(2) ................................ 4,500 0
Tax-related Fees(3) .................................. 14,500 8,000
(1) Both 2006 and 2007 Audit Fees include: (i) the audit of our
consolidated financial statements included in our Form 10-K and
services attendant to, or required by, statute or regulation; (ii)
reviews of the interim condensed consolidated financial statements
included in our quarterly reports on Form 10-Q for 2007 ; (iii) other
services related to SEC fillings; and (iv) associated expense
reimbursements.
(2) Audit-related Fees for 2006 include the fees for the audit of our
employee benefit plan. The plan has been terminated.
(3) Tax related fees were for tax preparation for Federal and California
Franchise tax returns for the tax year 2006.
The Audit Committee administers Interplay's engagement of Jeffrey S. Gilbert
C.P.A. and pre-approves all audit and permissible non-audit services on a
case-by-case basis. In approving non-audit services, the Audit Committee
considers whether the engagement could compromise the independence of Jeffrey S.
Gilbert C.P.A. and whether, for reasons of efficiency or convenience, it is in
the best interest of Interplay to engage its independent registered public
accounting firm to perform the services. The Audit Committee has determined that
performance by Jeffrey S. Gilbert C.P.A. of the non-audit services related to
the fees shown in the table above did not affect that firm's independence.
Prior to engagement, the Audit Committee pre-approves all independent auditor
services, and the Audit Committee pre-approved all fees and services of Jeffrey
S. Gilbert C.P.A., for work done in 2006 and 2007. The fees are budgeted and the
Audit Committee requires the independent auditor and management to report actual
fees versus the budget periodically throughout the year by category of service.
During the year, circumstances may arise when it may become necessary to engage
the independent registered public accounting firm for additional services not
contemplated in the original pre-approval categories. In those instances, the
Audit Committee requires specific pre-approval before engaging the independent
registered public accounting firm.
Interplay expects Jeffrey S. Gilbert C.P.A. to be present at the Annual Meeting,
where he will have an opportunity to make a statement if he desires to do so,
and will be available to respond to appropriate questions.
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table shows, as of May 14, 2008 information concerning the shares
of common stock beneficially owned by each person known by Interplay to be the
beneficial owner of more than 5% of our Common Stock (other than directors,
executive officers and depositaries). This information is based on publicly
available information filed with the SEC as of May 14, 2008.
Financial Planning and Development S.A. ("FPD") controls a majority of our
voting stock and can elect a majority of our Board of Directors and prevent an
acquisition of us that is favorable to our other stockholders. Alternatively,
FPD can also cause a sale of control of our Company that may not be favorable to
our other stockholders.
SHARES SUBJECT
TO WARRANTS
OR OPTIONS
SHARES OF EXERCISABLE
COMMON STOCK ON OR BEFORE PERCENT OF
NAME AND ADDRESS OWNED (1) MAY 14, 2008 (2) TOTAL CLASS (3)
------------------------ ------------ --------------- ----------- ----------
Financial Planning and
Development S.A. 58,426,293 400,000 58,826,293 56.4%
38 Avenue Du X Septembre
L-2550
Luxembourg
15
(1) Pursuant to Rule 13d-3(a), includes all shares of common stock over
which the listed person has, directly or indirectly, through any
contract, arrangement, understanding, relationship, or otherwise,
voting power, which includes the power to vote, or to direct the voting
of, the shares, or investment power, which includes the power to
dispose, or to direct the disposition of, the shares. Interplay
believes that each individual or entity named has sole investment and
voting power with respect to shares of Common Stock indicated as
beneficially owned by it, where applicable, except where otherwise
noted. Restricted shares are listed even when unvested and subject to
forfeiture because the holder has the power to vote the shares.
(2) In accordance with Rule 13d-3(d)(1) under the Securities Exchange Act
of 1934, each listed person is deemed Ihe beneficial owner of shares
that the person has a right to acquire by exercise of a vested warrant
or tption or other right within 60 days.
(3) Based on 103,855,634 shares of common stock outstanding as of May
14,2008. Under Rule 13d-3 of the Securities Exchange Act of 1934,
certain shares may be deemed to be beneficially owned by more than one
person (if, for example, a person shares the power to vote or the power
to dispose of the shares). As a result, the percentage of outstanding
shares of any person as shown in this table does not necessarily
reflect the person's actual ownership or voting power with respect to
the number of shares of Common Stock actually outstanding at May 14,
2008.
The following table shows, as of May 14, 2008, information with respect to the
shares of Common Stock beneficially owned by (1) each director and director
nominee, (2) each person (other than a person who is also a director or a
director nominee) who is an executive officer named in the Summary Compensation
Table below, and (3) all executive officers and directors as a group.
SHARES BENEFICIALLY OWNED
------------------------------------------
SHARES
SUBJECT TO
WARRANTS OR
OPTIONS
EXERCISABLE
SHARES OF ON OR BEFORE
COMMON STOCK MAY 14, PERCENT OF
NAME (1) OWNED (2) 2008 (3) TOTAL CLASS (4)
----------------------------------- ------------ ------------ ------------ ------------
Herve Caen **(5) .................. 8,681,306 6,120,000 14,801,306 14.2%
Eric Caen ......................... 30,001 170,000 200,001 *
Michel Welter ..................... 60,001 240,000 300,001 *
Alberto Haddad *** ................ -- -- -- *
Xavier de Portal *** .............. -- -- -- *
All current directors and executive
officers as a group ............ 8,771,308 6,530,000 15,301,308 14.7%
* Less than 1%.
** Current Director
*** Director nominee
(1) The business address of each person named is c/o Interplay
Entertainment Corp., 100 N. Crescent Drive Suite 324, Beverly Hills,
California 90210.
(2) Pursuant to Rule 13d-3(a), includes all shares of common stock over
which the listed person has, directly or indirectly, through any
contract, arrangement, understanding, relationship, or otherwise,
voting power, which includes the power to vote, or to direct the voting
of, the shares, or investment power, which includes the power to
dispose, or to direct the disposition of, the shares. Interplay
believes that each individual or entity named has sole investment and
voting power with respect to shares of Common Stock indicated as
beneficially owned by him or her, subject to community property laws,
where applicable, except where otherwise noted. Restricted shares are
listed even when unvested and subject to forfeiture because the holder
has the power to vote the shares.
(3) In accordance with Rule 13d-3(d)(1) under the Securities Exchange Act
of 1934, each listed person is deemed the beneficial owner of shares
that the person has a right to acquire by exercise of a vested warrant
or option or other right within 60.
(4) Based on 103,855,634 shares of Common Stock outstanding on the stock
records as of May 14, 2008. The percentages are calculated in
accordance with Rule 13d-3(d)(1), which provides that shares not
16
outstanding that are subject to options, warrants, rights or conversion
privileges exercisable within 60 days are deemed outstanding for the
purpose of calculating the number and percentage that each person owns,
but not deemed outstanding for the purpose of calculating the
percentage that any other listed person owns.
(5) Includes 8,681,306 shares of our common stock held by Mrs. Solange
Caen, Herve Caen's spouse.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our
executive officers, directors, and persons who own more than 10% of a registered
class of our equity securities to file reports of ownership and changes in
ownership with the SEC. Executive officers, directors and greater than 10%
stockholders are required by SEC rules and regulations to furnish us with all
Section 16(a) forms they file. Based solely on our review of the copies of the
forms received by us and representations from certain reporting persons that
they have complied with the relevant filing requirements, we believe that,
during the year ended December 31, 2007, all our executive officers, directors
and greater than 10% stockholders complied with all Section 16(a) filing
requirements, except for Financial Planning and Development S.A. with respect to
its holding of 56.3% of the Company's Common Stock.
STOCKHOLDER PROPOSALS
Any stockholder who intends to present a proposal at the 2009 Annual Meeting of
Stockholders for inclusion in our Proxy Statement and Proxy form relating to
such Annual Meeting must submit such proposal to us at our principal executive
offices by January 20, 2009. In addition, in the event a stockholder proposal is
not received by us by January 20, 2009, the Proxy to be solicited by the Board
of Directors for the 2009 Annual Meeting will confer discretionary authority on
the holders of the Proxy to vote the shares if the proposal is presented at the
2008 Annual Meeting without any discussion of the proposal in the Proxy
Statement for such meeting.
SEC rules and regulations provide that if the date of our 2009 Annual Meeting is
advanced or delayed more than 30 days from the date of the 2008 Annual Meeting,
stockholder proposals intended to be included in the proxy materials for the
2008 Annual Meeting must be received by us within a reasonable time before we
begin to print and mail the proxy materials for the 2009 Annual Meeting. Upon
determination by us that the date of the 2009 Annual Meeting will be advanced or
delayed by more than 30 days from the date of the 2008 Annual Meeting, we will
disclose such change in the earliest possible Quarterly Report on Form 10-Q.
SOLICITATION OF PROXIES
It is expected that the solicitation of Proxies will be by mail. We will
reimburse brokerage firms and other persons representing beneficial owners of
shares for their reasonable disbursements in forwarding solicitation material to
such beneficial owners. Proxies may also be solicited by certain of our
directors and officers, without additional compensation, personally or by mail,
telephone, telegram or otherwise.
ANNUAL REPORT ON FORM 10-K
A copy of Interplay's Annual Report on Form 10-K for the fiscal year ended
December 31, 2007 (excluding exhibits), as filed with the SEC, accompanies this
Proxy Statement, but it is not deemed to be a part of the proxy soliciting
material. The Form 10-K contains consolidated financial statements of Interplay
and its subsidiaries and the reports of Jeffrey S. Gilbert C.P.A, Interplay's
independent registered public accounting firm.
WE WILL PROVIDE TO ANY BENEFICIAL OWNER OF INTERPLAY'S COMMON STOCK AS OF THE
RECORD DATE A COPY OF THE ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED
DECEMBER 31 2007, WITHOUT CHARGE, IF THE BENEFICIAL OWNER SUBMITS A WRITTEN
REQUEST TO INTERPLAY ENTERTAINMENT CORP., C/O HERVE CAEN, CHIEF EXECUTIVE
OFFICER AND INTERIM CHIEF FINANCIAL OFFICER, 100 N. CRESCENT DRIVE SUITE 324,
BEVERLY HILLS, CALIFORNIA 90210. Exhibits to the Form 10-K will be provided on
written request of any beneficial owner, subject to reimbursement of Interplay's
reasonable expenses. Exhibits are available at no charge on the SEC's website,
www.sec.gov.
17
STOCKHOLDERS ARE URGED IMMEDIATELY TO COMPLETE, DATE AND SIGN THE ENCLOSED PROXY
AND RETURN IT IN THE ENVELOPE PROVIDED, TO WHICH NO POSTAGE NEED BE AFFIXED IF
MAILED IN THE UNITED STATES.
By Order of the Board of Directors,
INTERPLAY ENTERTAINMENT CORP.
/s/ Herve Caen
-------------------------
Herve Caen,
Secretary
Beverly Hills, California
May 20, 2008
18
APPENDIX 1
CERTIFICATE OF AMENDMENT
OF
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
INTERPLAY ENTERTAINMENT CORP.
The undersigned, Herve Caen, the Chief Executive Officer of Interplay
Entertainment Corp. (the "Corporation"), a corporation organized and existing by
virtue of the General Corporation Law (the "GCL") of the State of Delaware, does
hereby certify pursuant to Section 103 of the GCL as to the following:
1. The name of the Corporation is Interplay Entertainment Corp.
The original Certificate of Incorporation was filed with the Secretary of State
of the State of Delaware on February 27, 1998.
2. Article 5(a) of the Amended and Restated Certificate of
Incorporation of the Corporation, as amended, is hereby amended and restated,
effective as of the date on which the number of directors first fell below seven
(7), to read in its entirety as follows:
"ARTICLE 5
(a) The business and affairs of the Corporation shall be
managed by or under the direction of the Board of Directors and elections of
directors need not be by written ballot unless otherwise provided in the Bylaws.
The number of directors which shall constitute the whole Board of Directors of
the Corporation shall be between three (3) and nine (9), unless such minimum
and/or maximum number shall be changed by amendment to this Certificate of
Incorporation. The exact number of directors constituting the whole Board of
Directors may be changed from time to time by the Board of Directors, within the
limits provided above, in accordance with the Bylaws of the Corporation."
3. The foregoing amendment of the Amended and Restated
Certificate of Incorporation of the Corporation, as amended, has been duly
adopted by the Corporation's Board of Directors and Stockholders in accordance
with the provisions of Section 242 of the Delaware General Corporation Law.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Amendment of Amended and Restated Certificate of Incorporation as of the __ day
of __________ 2008.
-----------------------
Herve Caen
Chief Executive Officer
APPENDIX 2
INTERPLAY ENTERTAINMENT CORP.
CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
I. MEMBERSHIP
A. The Audit Committee (the "Committee") of the Board of
Directors (the "Board") shall meet the requirements of the
Sarbanes-Oxley Act (the "Act") and applicable rules of the
National Association of Securities Dealers (the "NASD") and
the SEC.
B. No member of the Committee shall receive compensation other
than director's fees and benefits for service as a director of
the Company, including reasonable compensation for Chairing
and/or serving on the Committee.
C. Any member of the audit committee may be removed or replaced
at any time by the Board of Directors and shall cease to be a
member of the Audit Committee on ceasing to be a Director.
II. PURPOSE
A. The Committee serves as the representative of the Board for
the general oversight of Company affairs relating to:
i. The quality and integrity of the Company's financial
statements.
ii. The independent auditor's qualifications and
independence, and
iii. The performance of the Company's independent
auditors.
B. Through its activities, the Committee facilitates open
communication among directors, independent auditors, and
management by meeting in private session regularly with these
parties.
III. MEETING AND PROCEDURES
A. The Committee shall meet in person or by telephone at least
quarterly.
B. It shall endeavor to determine that auditing procedures and
controls are adequate to safeguard Company assets and to
assess compliance with Company policies and legal
requirements.
C. The Committee shall be given full access to the Board
Chairman, Company executives and independent auditors. When
any audit has been prepared by a registered public accounting
firm for the Company, the Committee shall timely receive a
report from such firm on (1) all critical accounting policies
and practices; (2) all alternative treatments of financial
information within generally accepted accounting principles
that have been discussed with management officers of the
issuer, ramifications of the use of such alternative
disclosures and treatments, and the treatment preferred by the
registered public accounting firm; and (3) other material
written communications between the registered public
accounting firm and company management, such as any management
letter or schedule of unadjusted differences.
D. A majority of the members shall constitute a quorum or if
there shall only be one member, that member alone shall
constitute a quorum.
IV. RESPONSIBILITIES
A. The Committee shall:
i. Have the sole authority to appoint, compensate,
oversee, evaluate and, where appropriate, replace the
independent auditor.
ii. Annually review and approve the proposed scope of
each fiscal year's outside audit.
iii. Review and, if appropriate, approve in advance any
audit and non-audit services and fees to be provided
by the Company's independent auditor, other than
"prohibited nonauditing services" and minor audit
services, each as specified in the Act. The Committee
has the sole authority to make these approvals,
although such approval may be delegated to any
committee member so long as the approval is presented
to the full Committee at a later time. In approving
non-audit services, the Committee shall consider
whether the engagement has any potential to
compromise the independence of the independent
auditor, and whether for reasons of efficiency or
convenience it is in the best interest of the Company
to engage its independent auditor to perform the
services.
iv. Inform each registered public accounting firm
performing work for the Company that such firm shall
report directly to the Committee.
v. Oversee the work of any registered public accounting
firm employed by the Company, including the
resolution of any disagreement between management and
the auditor regarding financial reporting, for the
purpose of preparing or issuing an audit opinion or
related work.
vi. At, or shortly after the end of each fiscal year,
review with the independent auditor and Company
management, the audited financial statements and
related opinion and costs of the audit for that year.
vii. Provide any recommendations, certifications and
reports that may be required by the NASD or the SEC
including the report of the Committee that must be
included in the Company's annual proxy statement.
viii. Review and discuss the annual audited financial
statements and quarterly financial statements with
management and the independent auditor.
ix. Establish and oversee procedures for (a) the receipt,
retention, and treatment of complaints received by
the Company regarding accounting, internal accounting
controls, or auditing matters; and (b) the
confidential anonymous submission by employees of the
Company of concerns regarding questionable accounting
or auditing matters.
x. Have the authority to engage independent counsel and
other advisors as it determines necessary to carry
out its duties. The Company shall provide for
appropriate funding as determined by the Committee,
in its capacity as a committee of the Board of
Directors, for payment of compensation to any
advisors employed by the Committee and to the
independent auditor employed by the Company for the
purpose of rendering or issuing an audit report.
xi. Ensure, if required, the rotation of the lead audit
partner at least every five years.
xii Confirm, if required, with any independent auditor
retained to provide audit services for any fiscal
year that the lead (or coordinating) audit partner
(having primary responsibility for the audit), or the
audit partner responsible for reviewing the audit,
has not performed audit services for the Company in
each of the five previous fiscal years of the Company
and that the firm meets all legal and professional
requirements for independence.
xiii. Discuss with management the Company's policies with
respect to risk assessment and risk management.
xiv. Meet separately, and periodically, with management
and with the independent auditor.
xv. In consultation with management, review the integrity
of the Company's financial reporting process.
xvi. Review with the Chief Executive Officer ("CEO") and
the Chief Financial Officer ("CFO") (or if the CEO is
the interim CFO then only with such person)on an
annual basis the Company's disclosure controls and
procedures, including any significant deficiencies
in, or material non-compliance with, such controls
and procedures.
xvii. Review with the independent auditor (a) any audit
problems or other difficulties encountered by the
auditor in the course of the audit process, including
any restrictions on the scope of the independent
auditor's activities or on access to requested
information, and any significant disagreements with
management and (b) management's responses to such
matters, and all other items required by law.
xviii. Verify that the policies of the Audit Committee
regarding hiring of employees or former employees of
the independent auditor have been met. At a minimum,
these policies should provide that any registered
public accounting firm may not provide audit services
to the Company if the CEO, Controller, CFO, Chief
Accounting Officer or any person serving in an
equivalent capacity for the Company was employed by
the registered public accounting firm and
participated in the audit of the Company within one
year of the initiation of the current audit.
xiv. Report regularly to the Board of Directors. Such
report to the Board of Directors may take the form of
an oral report by the Chairman or any other member of
the Committee designated by the Committee to make
such report.
xx. Perform a review and evaluation, at least annually,
of the performance of the Committee. The Audit
Committee shall solicit feedback from the Board, CEO,
CFO, and the external auditor on specific
opportunities to improve Audit Committee
effectiveness. In addition, the Committee shall
review and reassess, at least annually, the adequacy
of this Charter and recommend to the Board of
Directors any improvements to the Charter that the
Committee considers necessary or valuable. The
Committee shall conduct evaluations and reviews in
such a manner as it deems appropriate.
xxi. Review periodically the effect of accounting
initiatives on the financial statements of the
Company.
xxii. At least annually, if required, receive a report by
the external auditors describing any material issues
raised by the most recent internal quality control
review by the local practice office or by any inquiry
or investigation by governmental or professional
authorities of the local practice office, within the
preceding two years, and steps taken to address any
such issues. The report, if applicable, shall also
include any similar matters pertaining to offices
other than the local practice office, to the extent
the audit partner is aware of such matters.
xxiii. Discuss with management an outline of press releases
or announcements regarding results of operations as
well as general policies on earnings guidance to be
provided to analysts, rating agencies, and the
general public. Review any relevant items with
management and the Company's independent auditors
prior to release of any such press releases or
earnings guidance including the use of "pro forma" or
"adjusted" non-GAAP information. The review shall be
with the Chairman of the Audit Committee or the full
Committee, as may be appropriate.
B. Management is responsible for preparing the financial
statements for the Company completely, accurately and in
accordance with generally accepted accounting principles.
C. The independent auditors are responsible for performing an
audit of the Company's financial statements and reporting on
the effectiveness of the internal controls over financial
reporting in accordance with the standards of the U.S. Public
Company Accounting Oversight Board.
APPENDIX 3
CERTIFICATE OF AMENDMENT
OF
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
INTERPLAY ENTERTAINMENT CORP.
The undersigned, Herve Caen, the Chief Executive Officer of Interplay
Entertainment Corp. (the "Corporation"), a corporation organized and existing by
virtue of the General Corporation Law (the "GCL") of the State of Delaware, does
hereby certify pursuant to Section 103 of the GCL as to the following:
1. The name of the Corporation is Interplay Entertainment Corp. The
original Certificate of Incorporation was filed with the Secretary of State of
the State of Delaware on February 27, 1998.
2. The first full sentence of Article 4 of the Amended and Restated
Certificate of Incorporation of the Corporation, as amended, is hereby amended
and restated to read in its entirety as follows:
"ARTICLE 4
The total number of shares of all classes of stock which this
Corporation shall have authority to issue is 305,000,000, of which (i)
300,000,000 shares shall be designated "Common Stock" and shall have a
par value of $0.001 per share; and (ii) 5,000,000 shares shall be
designated "Preferred Stock" and shall have a par value of $0.001 per
share."
3. The foregoing amendment of the Amended and Restated Certificate of
Incorporation of the Corporation, as amended, has been duly adopted by the
Corporation's Board of Directors and Stockholders in accordance with the
provisions of Section 242 of the Delaware General Corporation Law.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Amendment of Amended and Restated Certificate of Incorporation as of the __ day
of ______________.
__________________________
Herve Caen
Chief Executive Officer
INTERPLAY ENTERTAINMENT CORP.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, a stockholder of INTERPLAY ENTERTAINMENT CORP., a
Delaware corporation (the "Company"), hereby nominates, constitutes and appoints
Herve Caen as proxy of the undersigned with full power of substitution, to
attend, vote and act for the undersigned at the Annual Meeting of Stockholders
of the Company, to be held on June 30, 2008, and any postponements or
adjournments thereof, and in connection therewith, to vote and represent all of
the shares of the Company which the undersigned would be entitled to vote with
the same effect as if the undersigned were present, as follows:
A VOTE FOR ALL PROPOSALS IS RECOMMENDED BY THE BOARD OF DIRECTORS:
Proposal 1. To approve an amendment to our Restated Certificate of
Incorporation, as amended, to decrease the minimum number of
Directors from seven (7) to three (3), effective as of the date
on which the number of directors first fell below seven (7),
with such number being initially fixed at three (3) and if
Proposal 2 is approved then such number shall be fixed at five
(5).
|_| FOR |_| AGAINST |_| ABSTAIN
Proposal 2. Subject to the approval of Proposal 1, to elect the Board of
Directors' five nominees as directors:
Herve Caen Xavier de Portal
Eric Caen
Michel Welter
Alberto Haddad
|_| FOR ALL NOMINEES LISTED ABOVE (except as marked to the
contrary below)
|_| WITHHELD for all nominees listed above
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name in the space below:)
-----------------------------------------------------------------------
The undersigned hereby confer(s) upon the proxies, and each of them,
discretionary authority with respect to the election of directors in
the event that any of the above nominees is unable or unwilling to
serve.
Proposal 3. To approve an amendment to our Restated Certificate of
Incorporation, as amended, to increase the aggregate number of
shares of common stock authorized for issuance from 150,000,000
shares to 300,000,000 shares.
|_| FOR |_| AGAINST |_| ABSTAIN
The undersigned hereby revokes any other proxy to vote at the Annual
Meeting, and hereby ratifies and confirms all that said attorneys and proxies,
and each of them, may lawfully do by virtue hereof. With respect to matters not
known at the time of the solicitation hereof, said proxies are authorized to
vote in accordance with their best judgment.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS SET FORTH
ABOVE OR, TO THE EXTENT NO CONTRARY DIRECTION IS INDICATED, WILL BE TREATED AS A
GRANT OF AUTHORITY TO VOTE FOR ALL PROPOSALS. IF ANY OTHER BUSINESS IS PRESENTED
AT THE ANNUAL MEETING, THIS PROXY CONFERS AUTHORITY TO AND SHALL BE VOTED IN
ACCORDANCE WITH THE RECOMMENDATIONS OF THE PROXIES.
The undersigned acknowledges receipt of a copy of the Notice of Annual
Meeting and accompanying Proxy Statement dated May 20, 2008 relating to the
Annual Meeting.
Dated: , 2008
-----------------------------------------
Signature:
-------------------------------------------
Signature:
-------------------------------------------
Signature(s) of Stockholder(s)
(See Instructions Below)
The Signature(s) hereon should correspond exactly
with the name(s) of the Stockholder(s) appearing on
the Share Certificate. If stock is held jointly, all
joint owners should sign. When signing as attorney,
executor, administrator, trustee or guardian, please
give full title as such. If signer is a corporation,
please sign the full corporation name, and give title
of signing officer.
|_| Please indicate by checking this box if you
anticipate attending the Annual Meeting.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.