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1.
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Information
regarding each Nominee required to be disclosed pursuant to Section 7 of
Article I of the Bylaws is set forth in Exhibit A and Exhibit B
hereto. Annex A hereto sets forth each Nominee’s written
consent to his/her nomination, to be named in any proxy statement as a
nominee and to serve as a director of the Company, if
elected.
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2.
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The
name and address of the Record Holder, as we believe it appears on the
Company’s books is: BD Media Investors LP, 300 Crescent Court, Suite 1111,
Dallas, Texas 75201.
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3.
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As
of the date hereof, the Record Holder is the beneficial owner of 669,937
shares of common stock, par value $.01 per share, of the Company (the
“Common Stock”), 100 shares of which are held of record. The
Record Holder and certain other parties (the “Beneficial Owners”) may be
deemed to be a member of a “group” for purposes of Section 13(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), as more
fully described in the Schedule 13D relating to the Company filed by the
Record Holder and the Beneficial Owners with the Securities and Exchange
Commission (the “SEC”) on December 18, 2009, as amended (the
“Filing”).1
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4.
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The
Record Holder and/or the Beneficial Owners intend to deliver a proxy
statement and form of proxy to holders of at least a percentage of the
Company’s Common Stock reasonably believed by the Record Holder and/or the
Beneficial Owners to be sufficient to elect the
Nominees.
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1.
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The
Record Holder believes that each Nominee meets the criteria the Corporate
Governance and Nominating Committee uses in selecting nominees as set
forth in the Corporate Governance and Nominating Committee Charter,
adopted April 7, 2009, including that each Nominee has the highest
personal and professional standards of integrity and ethical values and
the ability to exercise sound, independent
judgment.
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2.
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The
Record Holder expects that, if elected, each Nominee is prepared to fairly
and equally serve the interest of all of the stockholders of the Company
and to make himself or herself available to the Board in the fulfillment
of his or her duties as a director.
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1.
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A
complete record or list of the Company’s stockholders certified by its
transfer agent, which record or list sets forth the name and address of
each stockholder of the Company and the number of shares of Common Stock
registered in the name of each stockholder of the Company as of the most
recent practicable date;
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2.
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A
complete list on magnetic computer tape, cartridge file, floppy disk,
compact disc, USB flash drive, electronically transmitted file, or similar
electronic medium (any such electronic storage medium, an “Electronic
Medium”) of the holders of the Common Stock as of the most recent
practicable date, showing the name, address and number of shares
registered in the name of each such holder; such computer processing data
as is necessary to make use of such list on an Electronic Medium; and a
hard copy printout of the full contents of such list on an Electronic
Medium for verification purposes;
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3.
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All
information in or which comes into the Company’s or its transfer agent(s)’
or registrar(s)’ possession or control, or which can reasonably be
obtained from brokers, dealers, banks, clearing agencies or voting
trustees or their nominees, concerning the names, addresses and number of
shares held by the participating brokers and banks named in the individual
nominee names of Cede & Co. or other similar depositories or nominees,
including respondent bank lists obtained pursuant to the requirements of
Rule 14b-2 promulgated under the Exchange
Act;
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4.
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All
information in or that comes into the Company’s possession, or that can
reasonably be obtained from nominees of any central certificate depository
system, concerning the number and identity of the actual beneficial owners
of Common Stock, including a list of all owners who hold Common Stock in
the name of Cede & Co. or other similar
nominees;
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5.
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A
list or lists containing the name, address, and number of shares of Common
Stock attributable to participants in any employee stock ownership,
incentive, profit sharing, savings, retirement, stock option, stock
purchase, restricted stock or other comparable plan of the Company in
which the voting of shares held by such plan is made, directly or
indirectly, individually or collectively, by participants in such plan,
including the method by which the Record Holder or its agents may
communicate with each such participant, as well as the name, firm and
phone number of the trustee or administrator of such plan and a detailed
explanation of the treatment not only of shares for which such trustee or
administrator receives instructions from participants, but also shares for
which either they do not receive instructions or shares which are
outstanding in the plan but are unallocated to any
participant;
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6.
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As
promptly as practicable, any and all omnibus proxies and correspondent
participant listings with respect to all nominees and respondent banks
which are currently in effect;
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7.
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All
lists and other data, including data in any Electronic Medium, in or which
come into the possession or control of the Company, or which can
reasonably be obtained pursuant to Rules 14b-1 and 14b-2 promulgated under
the Exchange Act, which set forth the name and address of, and the number
of shares owned by, each beneficial owner of Common Stock who has not
objected to having his or her name disclosed (the “non-objecting
beneficial owners” or “NOBO” list);
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8.
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A
“stop transfer” list or stop list relating to the shares of Common
Stock;
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9.
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Any
and all information that the Record Holder would be entitled to receive
under Rule 12a-7 of the Exchange Act;
and
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10.
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All
additions, changes and corrections to any of the information requested
pursuant to items 1 through 9 from the date hereof until the Record Holder
requests termination of the transmission of such
materials.
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BD
MEDIA INVESTORS LP
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By:
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SRB
Management, L.P., its general partner
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By:
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BC
Advisors, LLC, its general partner
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By:
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/s/Matthew A. Drapkin | |||
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Name: Matthew
A. Drapkin
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Title:
Co-Managing Member
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BD
MEDIA INVESTORS LP
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By:
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SRB
Management, L.P., its general partner
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By:
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BC
Advisors, LLC, its general partner
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By:
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/s/Matthew A. Drapkin | |||
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Name:
Matthew A. Drapkin
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Title:
Co-Managing Member
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1.
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The
Nominees are (i) Matthew A. Drapkin, age 37, (ii) Brian Edwards, age 46,
and (iii) Susan Rerat, age 52. Other than Mr. Drapkin, who, as
disclosed in the Filing, is the Co-Managing Member of BC Advisors LLC,
which is the general partner of SRB Management, L.P., which is the
investment manager for and general partner of the Record Holder, no
Nominee has any arrangement or understanding between him or her and any
other person pursuant to which he or she was or is to be selected as a
Nominee.
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2.
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There
exist no family relationships between any Nominee and any director or
executive officer of the Company.
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3.
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Each
Nominee’s background is set forth on Exhibit B. During the past
five years, none of the Nominees have held any occupation or employment
with the Company or any corporation or organization that is or was a
parent, subsidiary or other affiliate of the Company. Each
Nominee has the experience, qualifications, attributes and skills to serve
as a successful director of the Company. Mr. Drapkin has
specialized in the media sector and has a strong background in financial
analysis, including membership on the board and audit committee of a
publicly traded company (Plato Learning, Inc. since 2009). Mr.
Edwards has experience in film and television production in both business
and legal capacities at two leading companies in those
businesses. Ms. Rerat has had extensive experience in media
publication, both print and online, and specifically, experience reaching
female demographics.
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4.
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During
the last ten years, none of the Nominees were involved in any of the
events described in Item 401(f) of Regulation S-K and that are material to
an evaluation of the ability or integrity of any such Nominee to become a
director of the Company.
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5.
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There
is no transaction, or series of similar transactions, since January 31,
2009, or any currently proposed transaction, or series of similar
transactions, to which the Company or any of its subsidiaries was or is to
be a party, in which the amount involved exceeds $120,000 and in which any
Nominee or any associate of any Nominee, or any member of the immediate
family of any Nominee or of any associate of any Nominee, had, or will
have, a direct or indirect material
interest.
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6.
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As
fully disclosed in the Filing, Mr. Drapkin may be deemed to be a member of
a “group” which owns more than 10% of the Company’s outstanding Common
Stock. Based on a review of all Forms 3 and 4 filed by Mr.
Drapkin with the SEC since January 31, 2009, Mr. Drapkin has not filed any
Form 3 or 4 after the date on which it was due to be filed or engaged in
any transaction in the Company’s securities for which he failed to file a
required form. Mr. Drapkin represents that he has not been
required to file a Form 5. Other than Mr. Drapkin (as described
in the Filing), no Nominee owns any securities of the Company (or any
parent or subsidiary of the Company), directly or indirectly, beneficially
or of record, or has purchased or sold any securities of the Company
within
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7.
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the
past two years, and no associate of any Nominee (other than the associates
of Mr. Drapkin as described in the Filing) beneficially owns, directly or
indirectly, any securities of the
Company.
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8.
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Based
on the experience described above, including experience serving on the
audit committee of Plato Learning, Inc., Mr. Drapkin qualifies as an audit
committee financial expert.
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9.
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None
of the Nominees are officers or employees of the Company or has a
relationship which, in the opinion of the Record Holders, would interfere
with the exercise of independent judgment in carrying out the
responsibilities of a director, and each of them is an “independent
director” as the term is defined under Rule 5605(a)(2) of the NASDAQ
Marketplace Rules, and is “independent” as that term is defined in the
applicable rules and regulations promulgated by the
SEC.
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10.
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No
Nominee has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) during the past ten
years.
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11.
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Other
than as described in the Filing with respect to Mr. Drapkin, no Nominee is
or was within the past year, a party to any contract, arrangements or
understandings with any person with respect to any securities of the
Company, including joint ventures, loan or option arrangements, puts or
calls, guarantees against loss or guarantees of profit, division of losses
or profits or the giving or withholding of
proxies.
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12.
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No
Nominee or associate of any Nominee has any arrangement or understanding
with any person (a) with respect to any future employment with the Company
or its affiliates or (b) with respect to any future transactions to which
the Company or any of its affiliates will or may be a
party.
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13.
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No
Nominee has any substantial interest, direct or indirect, in the matters
to be acted on at the Annual Meeting, except his or her interest in being
nominated for election as a director, or in the case of Mr. Drapkin, his
beneficial ownership of the Company’s Common Stock as reported in the
Filing, and as otherwise described
herein.
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14.
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There
are no material proceedings in which the Nominees or any of their
associates is a party adverse to the Company or any of its subsidiaries,
or material proceedings in which such Nominee or any such associate has a
material interest adverse to the Company or any of its
subsidiaries.
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