UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14C
(RULE 14c-101)
SCHEDULE 14C
INFORMATION
Information
Statement Pursuant to Section 14(c) of the Securities Exchange Act of
1934
Check the
appropriate box:
¨ Preliminary
Information Statement
¨ Confidential,
for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))
ý Definitive
Information Statement
CTM
MEDIA HOLDINGS, INC.
(Name of
Registrant As Specified In Its Charter)
Payment
of Filing Fee (Check the appropriate box):
ý No
fee required
¨ Fee
computed on table below per Exchange Act Rules 14c-5(g) 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 (set forth the amount on which the filing fee is
calculated and state how it was
determined):
|
|
(4)
|
Proposed
maximum aggregate value of
transaction:
|
|
(5)
|
Total
fee paid:
|
¨ Fee
paid previously 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:
|
CTM
MEDIA HOLDINGS, INC.
11 Largo
Drive South
Stamford,
Connecticut 06907
November
24, 2009
Dear
Stockholders:
The
purpose of the accompanying Information Statement is to advise the stockholders
of CTM Media Holdings, Inc., a Delaware corporation (the “Company”), of the
following corporate actions taken by written consent of the majority
stockholders:
1. The
election of five (5) directors to serve until the next annual meeting of
stockholders and the due election and qualification of their respective
successors; and
2. The
ratification of the appointment of Zwick & Steinberger, P.L.L.C. as
independent auditor of the Company for Fiscal 2010.
The above
corporate actions were authorized by written consent in lieu of an annual
general meeting of stockholders by the holders of a majority of the combined
voting power over the Company’s outstanding capital stock on November 17, 2009,
in accordance with the requirements of the Delaware General Corporation Law. All
necessary corporate approvals in connection with the matters referred to in this
Information Statement have been obtained.
WE
ARE NOT ASKING YOU FOR A PROXY AND
YOU
ARE REQUESTED NOT TO SEND US A PROXY
No action
is required by you. The accompanying Information Statement is furnished pursuant
to Section 14 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), for the purpose of informing our stockholders of the actions
described above before they take effect. In accordance with Rule 14c-2 under the
Exchange Act, the actions by stockholder consent will not become effective until
at least 20 days following the mailing of this Information Statement to
stockholders. These actions have been approved by our Board of Directors and the
record and beneficial holders of a majority of the combined voting power of the
Company’s outstanding capital stock. Only stockholders of record at the close of
business on November 17, 2009 are being given notice of these actions by written
consent. The Company is not
soliciting proxies.
This
Information Statement is being mailed on or about November 27, 2009 to
stockholders of record of CTM Media Holdings, Inc. as of November 17, 2009, and
is being delivered to inform you of the corporate actions described herein
before they take effect in accordance with Rule 14c-2 of the Exchange
Act.
The cost
of furnishing this Information Statement will be borne by us. We will mail this
Information Statement to registered stockholders and certain beneficial
stockholders where requested by brokerage houses, nominees, custodians,
fiduciaries and other like parties.
Delivery
of Documents to Stockholders Sharing an Address
Unless we
have received contrary instructions from a stockholder, we are delivering only
one annual report to stockholders and one Information Statement to multiple
stockholders sharing an address. This practice known as “householding” is
intended to reduce the Company’s printing and postage costs. We will, upon
request, promptly deliver a separate copy of the annual report and this
Information Statement to a stockholder who shares an address with another
stockholder. A stockholder who wishes to receive a separate copy of the annual
report or Information Statement may direct such request to our Corporate
Secretary, Leslie B. Rozner, at CTM Media Holdings, Inc., 11 Largo Drive South,
Stamford, Connecticut 06907, telephone: (203) 323-5161, email: lrozner@ctmmedia.com.
Stockholders who receive multiple copies of the Information Statement or annual
report at their address and would like to request that only a single copy of
communications be delivered in the future to the shared address may do so by
making either a written or oral request to the Company contacts listed
above.
IMPORTANT
NOTICE REGARDING THE AVAILABILITY OF THE INFORMATION STATEMENT
FOR
CTM MEDIA HOLDINGS, INC.
The
Information Statement and the 2009 Annual Report are available at:
http://ir.ctmholdings.com/annualmeeting
Sincerely,
Howard S.
Jonas
Chairman
of the Board
CTM
MEDIA HOLDINGS, INC.
11 Largo
Drive South
Stamford,
Connecticut 06907
INFORMATION
STATEMENT
ACTIONS
BY BOARD OF DIRECTORS AND CONSENTING STOCKHOLDER
On
October 14, 2009, our Board of Directors, upon the recommendation of the
Company’s Nominating Committee, nominated for election the following five
directors, each for a term of one year: Howard S. Jonas, Marc Knoller, Jan
Buchsbaum, Perry Davis and Elion Krok and recommended that the stockholders of
the Company vote for the election of the foregoing directors. On November 17,
2009, by written consent of the holders of a majority of the combined voting
power of the Company’s outstanding capital stock (the “Consenting
Stockholders”), holding shares of the Company’s common stock (which includes
497,237 shares of Class A common stock, 2,394,365 shares of Class B common stock
and 1,090,775 shares of Class C common stock which are convertible into shares
of Class A common stock on a 1-for-1 basis), representing approximately 76.4% of
the combined voting power of the Company’s outstanding capital stock, as of
November 17, 2009 (the “Written Consent”), Messrs. Jonas, Knoller, Buchsbaum and
Davis and Dr. Krok were re-elected to the Board of Directors of the
Company.
On
October 14, 2009, our Board of Directors, upon the recommendation of the
Company’s Audit Committee, ratified the appointment of Zwick & Steinberger,
P.L.L.C. as the Company’s independent registered public accounting firm for
Fiscal 2010, and recommended that the stockholders vote to ratify the same. The
action taken by the Board of Directors was subsequently ratified by Written
Consent of the Consenting Stockholders.
DISSENTER’S
RIGHT OF APPRAISAL
Under
Delaware law, stockholders are not entitled to dissenter’s rights of appraisal
with respect to the above corporate actions.
INTEREST
OF CERTAIN PERSONS IN OR OPPOSITION TO MATTERS TO BE ACTED UPON
No
director, executive officer, associate of any director or executive officer or
any other person has any substantial interest, direct or indirect, by security
holdings or otherwise, in the matters to be acted upon (other than elections to
office).
VOTING
SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of
November 17, 2009, there were 1,258,818 shares of our Class A common stock,
6,923,450 shares of our Class B common stock and 1,090,775 shares of our Class C
common stock, issued and outstanding and no shares of our preferred stock issued
or outstanding. Each holder of Class A shares is entitled to one vote, each
holder of Class B shares is entitled to one-tenth of a vote, and each holder of
Class C shares is entitled to three votes, for each such share held by such
holder. As of November 17, 2009, Howard S. Jonas was the beneficial owner of
497,237 Class A shares, 2,394,365 Class B shares and 1,090,775 Class C shares,
which represented 42.8% of the issued and outstanding common stock of, and
approximately 76.4 % of the combined voting power of the Company’s outstanding
capital stock. Mr. Jonas acquired his interest in the Company on September 14,
2009 when the Company’s capital stock was spun off from IDT Corporation (“IDT”)
and distributed to IDT’s stockholders (the “Spin-Off”) and pursuant to grants of
restricted stock as discussed more fully in the “Executive Compensation” section
below.
The
Consenting Stockholders approved the corporate actions described above by the
Written Consent. The Consenting Stockholders consist of Howard S. Jonas and
entities over which he possesses voting and dispositive power, including: the
Jonas Family Limited Partnership, Howard S. Jonas 2009 Annuity Trust I, Howard
S. Jonas 2009 Annuity Trust II, the Jonas Foundation, Howard S. and Deborah
Jonas Foundation, Inc., trusts for the benefit of the children of Mr. Jonas,
custodial accounts for the benefit of the children of Mr. Jonas, and shares held
in Mr. Jonas’ IDT Corporation 401(k) plan account.
1
VOTING
PROCEDURES
Pursuant
to our by-laws, the affirmative vote of the holders of issued and outstanding
capital stock of the Company representing not less than a majority of the voting
power of all issued and outstanding capital stock of the Company entitled to
vote thereon is sufficient to ratify the appointment of Zwick & Steinberger,
P.L.L.C. as independent auditor of the Company for Fiscal 2010, while the vote
standard for the election of directors is a majority of votes cast. Our by-laws
provide further that any action required or permitted to be taken at any annual
or special meeting of stockholders of the Company may be taken without a
meeting, without prior notice and without a vote, if a consent in writing,
setting forth such action to be taken, is signed by the holders of outstanding
stock having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to
vote thereon were present and voted. The vote to ratify the appointment of Zwick
& Steinberger, P.L.L.C. and to elect the directors to the Board of Directors
was obtained through the Written Consent of the Consenting Holders as the
holders of approximately 76.4% of the combined voting power of the Company as of
November 17, 2009.
Security
Ownership of Certain Beneficial Owners and Management
The
following table sets forth the number and percentage of shares of the Company’s
various classes of common stock owned beneficially and of record by each
director and each officer of the Company, and by each person beneficially owning
more than five percent (5%) of any class of the common stock, as of November 17,
2009. Except as otherwise noted, the address of the referenced individual is c/o
CTM Media Holdings, Inc., 11 Largo Drive South, Stamford, Connecticut
06907.
To our
knowledge, except as otherwise indicated in the footnotes below, each person or
entity has sole or shared voting and investment power with respect to the shares
of common stock set forth opposite such persons or entity’s name. Beneficial
ownership is determined in accordance with the rules of the U.S. Securities and
Exchange Commission (the “SEC”) and generally includes voting or investment
power with respect to the securities.
|
Name
|
Number of
Shares
of
Class
A Common
Stock
|
Percentage
of
Ownership
of
Class
A Common
Stock
|
Number of
Shares
of
Class
B Common
Stock
|
Percentage
of
Ownership
of
Class
B Common
Stock
|
Percentage
of
Aggregate
Voting
Powerd
|
|||||||||||||||
|
Howard
S. Jonas
Chairman
of the Board and Director
11
Largo Drive South
Stamford,
CT 06907
|
1,588,012 | (1) | 66.8 | % | 2,394,365 | (2) | 34.6 | % | 76.4 | % | ||||||||||
|
William
C. Martin
254
Witherspoon Street
Princeton,
New Jersey 08542
|
— | 834,245 | (3) | 12.1 | % | 1.6 | % | |||||||||||||
|
Marc
E. Knoller
Chief
Executive Officer, President and Director
|
— | — | 5,033 | (4) | * | * | ||||||||||||||
|
Leslie
B. Rozner
Chief
Financial Officer
|
— | — | 321 | (5) | * | * | ||||||||||||||
|
Jan
Buchsbaum
Independent
Director
|
— | — | — | — | — | |||||||||||||||
|
Perry
Davis
Independent
Director
|
— | — | — | — | — | |||||||||||||||
|
Elion
Krok
Independent
Director
|
— | — | — | — | — | |||||||||||||||
|
All
directors and executive officers as a group
|
1,588,012 | 66.8 | % | 2,399,719 | 34.7 | % | 76.4 | % | ||||||||||||
2
_______________
|
*
|
Less
than 1%.
|
|
d
|
Voting
power represents combined voting power of Class A common stock (one vote
per share), Class B common stock (1/10 of a vote per share) and Class
C common stock (three votes per
share).
|
|
(1)
|
Consists
of an aggregate of 1,090,775 shares of Class C common stock (which are
convertible into Class A common stock) and 497,237 shares of Class A
common stock (which includes 294,444 shares of restricted Class A Common
Stock) held directly by Mr. Jonas or trusts, foundations, accounts or
entities that Mr. Jonas controls.
|
|
(2)
|
Consists
of 2,394,401 shares of Class B common stock (which includes 2,177,856
shares of restricted Class B common stock) held directly by Mr. Jonas or
trusts, foundations, accounts or entities that Mr. Jonas controls and 482
shares of Class B common stock held by Mr. Jonas in his IDT Corporation
401(k) plan as of November 13, 2009. Does not include an aggregate of
383,360 shares of Class B common stock beneficially owned by trusts for
the benefit of Mr. Jonas’ children and 518 shares of Class B common stock
beneficially owned by Mr. Jonas’ adult child sharing the same household,
as Mr. Jonas does not exercise or share voting or investment power over
these shares.
|
|
(3)
|
Consists
of (i) 5,000 shares held directly by Mr. Martin, (ii) 451,933 shares held
by Raging Capital Fund, LP, and (iii) 377,312 shares held by Raging
Capital Fund (QP), LP, according to Form 4 filed with the Securities and
Exchange Commission on November 17,
2009.
|
|
(4)
|
Consists
of 4,535 shares of Class B common stock held by Mr. Knoller directly and
498 shares of Class B common stock held by Mr. Knoller in his IDT
Corporation Plan as of November 13,
2009.
|
|
(5)
|
Consists
of shares of Class B common stock held by Mr. Rozner
directly.
|
3
PROPOSAL
1
ELECTION
OF DIRECTORS
DIRECTORS
AND EXECUTIVE OFFICERS
Our five
incumbent directors were re-elected pursuant to the Written Consent. These
directors are to serve until the next annual meeting of the Company’s
stockholders, the next time directors are elected (at a meeting or by written
consent in lieu of a meeting of stockholders) or until their respective
successors are duly elected and qualified. The Board of Directors may also
appoint an additional 12 directors up to the maximum number of 17 directors
permitted under our by-laws. Each executive officer serves at the discretion of
the Board of Directors and holds office until his successor is elected or until
his earlier resignation or removal in accordance with our certificate of
incorporation and by-laws.
The name,
age and position of our present directors and officers are as set forth
below:
|
Name
|
Age
|
Position
|
||
|
Howard
S. Jonas
|
53
|
Chairman
of the Board and Director
|
||
|
Marc
E. Knoller
|
48
|
Chief
Executive Officer, President and Director
|
||
|
Leslie
B. Rozner
|
57
|
Chief
Financial Officer, Treasurer and Corporate Secretary
|
||
|
Jan
Buchsbaum
|
27
|
Director
|
||
|
Perry
Davis
|
61
|
Director
|
||
|
Elion
Krok
|
48
|
Director
|
Set forth
below is biographical information with respect to each of the aforementioned
individuals.
Howard S. Jonas has served as
our Chairman of the Board since our inception. Mr. Jonas founded IDT in August
1990, and has served as Chairman of IDT’s Board of Directors since its
inception. Mr. Jonas has served as Chief Executive Officer of IDT since
October 2009 and from December 1991 until July 2001. Mr. Jonas served as
President of IDT from December 1991 through September 1996, and as Treasurer of
IDT from inception through 2002. Mr. Jonas has served as Co-Vice Chairman of
Genie Energy Corporation since September 2009. Mr. Jonas has also served as
the Vice Chairman of the Board of Directors of IDT Telecom from December 1999 to
April 2008, as Co-Chairman since April 2008, and as a director of IDT Capital
since September 2004. Mr. Jonas served as Co-Chairman of the Board of
Directors of IDT Entertainment from November 2004 until August 2006. Since
August 2006, Mr. Jonas has been a director of Starz Media Holdings, LLC,
Starz Media, LLC and Starz Foreign Holdings, LLC, each of which is a subsidiary
of Liberty Media Corporation. In addition, Mr. Jonas has been a director of IDT
Energy since June 2007 and a director of American Shale Oil Corporation since
January 2008. Mr. Jonas is also the founder and has been President of Jonas
Media Group (f/k/a Jonas Publishing) since its inception in 1979. Mr. Jonas
was the Chairman of the Board of Directors of Net2Phone from October 2001 to
October 2004, the Vice Chairman of the Board of Directors of Net2Phone from
October 2004 to June 2006, and has served as the Chairman of Net2Phone since
June 2006. Mr. Jonas received a B.A. in Economics from Harvard
University.
Marc E. Knoller has been our
Chief Executive Officer, President and a director of the Company since our
inception. Prior to the Spin-Off, Mr. Knoller had served as an Executive Vice
President of IDT since December 1998 and served as a director of IDT from March
1996 to August 2007. Mr. Knoller joined IDT as a Vice President in March
1991 and also served as a director of its predecessor. Mr. Knoller has
served as Vice President of Jonas Media Group (f/k/a Jonas Publishing) since
1991. Mr. Knoller received a B.B.A. from Baruch College.
Leslie B. Rozner has been our
Chief Financial Officer since our inception and Chief Financial Officer of CTM
Media Group since August 2008. Mr. Rozner served as Chief Financial Officer of
IDT Spectrum from July 2006 until July 2008. Prior to that time, Mr. Rozner
worked as a certified public accountant and provided consulting services to IDT.
Mr. Rozner originally joined IDT in 1991 and served as Chief Financial Officer
of IDT until 1993.
4
Mr.
Rozner is a certified public
accountant licensed by the State of New York. Mr. Rozner received a B.S. in
Accounting from Brooklyn College of CUNY. Mr. Rozner filed for Chapter 7
personal bankruptcy in October 2005, which was discharged in December
2007.
Jan Buchsbaum has been a
director of the Company since August 2009. Mr. Buchsbaum serves as a management
associate at New York Life Insurance Company. Prior to working at New York Life,
Mr. Buchsbaum served as founder and CEO of MTB Solutions, Inc., a New York-based
electronics distribution company, from August 2007 to July 2009, and currently
serves on MTB’s Board of Directors. From May to August 2008, Mr. Buchsbaum
worked as a summer associate in Scotia Capital, the investment banking unit of
the Bank of Nova Scotia. Mr. Buchsbaum worked for IDT Telecom from August 2006
through August 2007, and for IDT Entertainment from August 2005 through August
2006. Mr. Buchsbaum received his M.B.A. from Georgetown University and a B.S. in
Business, Management and Finance from Brooklyn College.
Perry Davis has been a
director of the Company since August 2009. Mr. Davis is a partner at Perry Davis
Associates, Inc. (PDA), an international consulting firm providing management
and development assistance to non-profit organizations. Mr. Davis is a founder
of PDA and has been its President since 1986. Mr. Davis received his Ph.D. in
Public Law and Government from Columbia University and a B.A. in Political
Science from Yeshiva College.
Dr. Elion Krok has been a
director of the Company since August 2009. Dr. Krok founded Natron, Inc. in
1988, and has been the President and a director since its inception. Natron,
Inc. markets and sells consumer household products, including Wipease®.
Dr. Krok received his M.B.Ch.B. from the University of Cape Town, South
Africa and has been a medical resident at St. Barnabas Hospital in Livingston,
New Jersey since October 2008.
5
PROPOSAL
2
RATIFICATION
OF
APPOINTMENT
OF INDEPENDENT AUDITORS
The
appointment by our Board of Directors, upon the recommendation of the Board’s
Audit Committee, of Zwick & Steinberger, P.L.L.C. (“Z&S”), an
independent registered public accounting firm, as the Company’s independent
auditor was ratified by the Consenting Stockholders in the Written
Consent.
Audit
and Non-Audit Fees
The
following table presents fees for professional services rendered by Z&S for
the audit of the Company’s annual financial statements for the fiscal years
ended July 31, 2009 and 2008.
|
2009
|
2008
|
|||||||
|
Audit
fees
|
$ | 120,000 | (1) | $ | 112,139 | (2) | ||
|
Audit
related fees
|
$ | 21,311 | (3) | $ | — | |||
|
Tax
fees(4)
|
$ | — | $ | — | ||||
|
All
other fees(5)
|
$ | — | — | |||||
|
Total
|
$ | 141,311 | $ | 112,139 | ||||
|
|
(1)
|
Audit
fees for fiscal 2009 were principally for audit work performed on the
consolidated financial statements for the fiscal year ended July 31,
2009.
|
|
|
(2)
|
Audit
fees for fiscal 2008 were principally for audit work performed in fiscal
2009 on the consolidated financial statements for the fiscal years ended
July 31, 2008 and 2007.
|
|
|
(3)
|
Audit
related fees were principally for work completed on the Company’s
information Statement and Form 10 in connection with the
spinoff.
|
|
|
(4)
|
Z&S
did not provide any “tax services” during the
period.
|
|
|
(5)
|
Z&S
did not provide any “other services” during the
period.
|
Policy
on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of
the Independent Registered Public Accounting Firm
The Audit
Committee is responsible for appointing, setting compensation for, and
overseeing the work of the Company’s independent registered public accounting
firm. The Audit Committee has established a policy regarding pre-approval of all
audit and permissible non-audit services provided by the independent registered
public accounting firm, and all such services were approved by the Audit
Committee in Fiscal 2009. Each reference to a fiscal year in this Information
Statement refers to the fiscal year ending in the calendar year indicated (for
example, Fiscal 2009 refers to the fiscal year ended July 31,
2009).
The Audit
Committee assesses requests for services by the independent registered public
accounting firm using several factors. The Audit Committee will consider whether
such services are consistent with the PCAOB’s and SEC’s rules on auditor
independence. In addition, the Audit Committee will determine whether the
independent registered public accounting firm is best positioned to provide the
most effective and efficient service based upon the members’ familiarity with
the Company’s business, people, culture, accounting systems, risk profile and
whether the service might enhance the Company’s ability to manage or control
risk or improve audit quality.
Report
of the Audit Committee
The
primary purpose of the Audit Committee is to assist the Board of Directors in
its general oversight of the Company’s financial reporting process. The Audit
Committee’s function is more fully described in its charter, which can be found
on the Company’s website at www.ctmholdings.com.
The Committee reviews the charter on an annual basis. The Board of Directors
annually reviews the Company’s Corporate Governance Guidelines’ definition of
independence for Audit Committee members and has determined that each member of
the Committee meets that
6
standard.
The Board of Directors has also determined that Jan Buchsbaum qualifies as an
“audit committee financial expert” within the meaning of Item 407(d)(5) of
Regulation S-K.
In
connection with the Audit Committee’s responsibilities set forth in its charter,
the Audit Committee has:
|
·
|
Reviewed
and discussed the audited financial statements for the fiscal year ended
July 31, 2009 with management and Zwick & Steinberger, P.L.L.C.
(“Z&S”), the Company’s independent
auditors;
|
|
·
|
Discussed
with Z&S the matters required to be discussed by the Statement of
Auditing Standards No. 114 (SAS 114 — The Auditor’s Communication with
Those Charged with Governance), as amended (AICPA Professional Standards,
Vol. 1 AU Section 380) as adopted by the Public Company Accounting
Oversight Board in Rule 3200T (SAS 114 requires Z&S to provide the
Audit Committee with additional information regarding the scope and
results of their audit of the Company’s financial statements with respect
to (i) their responsibility under auditing standards generally accepted in
the United States, (ii) significant accounting policies, (iii) management
judgments and estimates, (iv) any significant audit adjustments, (v) any
disagreements with management and (vi) any difficulties encountered in
performing the audit); and
|
|
·
|
Received
the written disclosures and the letter from Z&S required by the
applicable requirements of the Public Company Accounting Oversight Board
regarding Z&S’s communications with the audit committee concerning
independence, and has discussed with Z&S its
independence.
|
The Audit
Committee also considered, as it determined appropriate, tax matters and other
areas of financial reporting and the audit process over which the Audit
Committee has oversight.
Based on
the Audit Committee’s review and discussions described above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in the Company’s Annual Report on
Form 10-K for the fiscal year ended July 31, 2009 for filing with the
SEC.
|
THE
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
|
|
Jan
Buchsbaum, Chairman
|
|
Perry
Davis
|
|
Elion
Krok
|
7
CORPORATE
GOVERNANCE
Director
Independence
Our
Corporate Governance Guidelines provide that a majority of our directors must be
independent as defined therein. Our Board of Directors has determined that each
of Messrs. Buchsbaum, Davis and Krok is “independent” in accordance with the
Corporate Governance Guidelines and, thus, that a majority of the current Board
of Directors is independent. The full text of our Corporate Governance
Guidelines, including the director independence requirements, is available for
your review in the Corporate Governance section of our website at http://ir.ctmholdings.com.
Director
Selection Process
The
Nominating Committee will consider director candidates recommended by the
Company’s stockholders. Stockholders may recommend director candidates by
contacting the Chairman of the Board as provided under the heading
“Communications with the Board of Directors.” The Nominating Committee considers
candidates suggested by its members, other directors, senior management and
stockholders in anticipation of upcoming elections and actual or expected board
vacancies. All candidates, including those recommended by stockholders, are
evaluated on the same basis in light of the entirety of their credentials and
the needs of the Board of Directors and the Company. Of particular importance is
the candidate’s wisdom, integrity, ability to make independent analytical
inquiries, understanding of the business environment in which the Company
operates, as well as his or her potential contribution to the diversity of the
Board of Directors and his or her willingness to devote adequate time to fulfill
duties as a director.
Committees
of the Board of Directors
Our Board
of Directors has established an Audit Committee, a Nominating Committee, a
Compensation Committee, and a Corporate Governance Committee. All members of the
Audit, Compensation and Corporate Governance Committees meet the criteria for
independence as established by our Corporate Governance Guidelines and under the
Sarbanes-Oxley Act of 2002. Each of the Committees is described in greater
detail below. The Board of Directors has established written charters for each
of the Committees, which are available on our website in the Corporate
Governance section located at http://ir.ctmholdings.com,
and which are also available in print to any stockholder upon request to the
Corporate Secretary. Any changes to the charters are reflected on our
website.
Messrs.
Buchsbaum (Chairman), Davis and Krok have been designated as members of our
Audit Committee. The principal duties of the Audit Committee under its written
charter include: (i) responsibilities associated with our external and internal
audit staffing and planning; (ii) accounting and financial reporting issues
associated with our financial statements and filings with the SEC; (iii)
financial and accounting organization and internal controls; (iv) auditor
independence and approval of non-audit services; and (v) “whistle-blower”
procedures for reporting questionable accounting and audit
practices.
The Audit
Committee charter requires that the Committee be comprised of at least two
directors, both of whom must be independent under our Corporate Governance
Guidelines and the Sarbanes-Oxley Act of 2002. In addition, each member of the
Audit Committee is financially literate within the meaning of our Corporate
Governance Guidelines, and our Board of Directors has determined that Mr.
Buchsbaum has sufficient accounting or financial management expertise to qualify
as an “audit committee financial expert,” in accordance with SEC
rules.
Messrs.
Jonas (Chairman) and Knoller have been designated as members of our Nominating
Committee. The principal duties of the Nominating Committee under its charter
include: (i) developing the criteria and qualifications for membership on
the Board of Directors; (ii) recommending candidates to fill new or vacant
positions on the Board of Directors; and (iii) conducting appropriate
inquiries into the backgrounds of potential candidates.
8
Messrs.
Buchsbaum, Davis and Krok (Chairman) have been designated as members of our
Compensation Committee. The principal duties of the Compensation Committee under
its charter include: (i) ensuring that a succession plan for the Chief Executive
Officer is in place; (ii) reviewing management’s recommendations for executive
officers and making recommendations to the Board of Directors; (iii) approving
the compensation for the Chief Executive Officer; (iv) reviewing and approving
compensation policies and practices for other executive officers including their
annual salaries; (v) reviewing and approving major changes in employee benefit
plans; (vi) reviewing short and long-term incentive plans and equity grants; and
(vii) recommending to the full Board of Directors changes to the compensation of
the independent members of the Board of Directors, such as retainers, committee
and other fees, stock option, restricted stock and other stock awards, and other
similar items as deemed appropriate. The Compensation Committee confers with our
executive officers when making the above determinations. The Compensation
Committee charter requires that the Committee be comprised of at least two
directors, both of whom must be independent under our Corporate Governance
Guidelines. There were no Compensation Committee meetings during Fiscal
2009.
Messrs.
Buchsbaum, Davis (Chairman) and Krok have been designated as members of our
Corporate Governance Committee. The principal duties of the Corporate Governance
Committee under its charter include: (i) reviewing our Corporate Governance
Guidelines and other policies and governing documents and recommending revisions
as appropriate; (ii) reviewing any potential conflicts of interest of
independent directors; (iii) reviewing and monitoring related person
transactions; and (iv) overseeing the self-evaluations of the Board of
Directors, the Audit Committee and the Compensation Committee. The Corporate
Governance Committee charter requires that the Committee be comprised of at
least two directors, both of whom must be independent under our Corporate
Governance Guidelines.
Board
Meetings
Our Board
of Directors did not have any formal meetings during Fiscal 2009, but acted by
unanimous written consent on two occasions.
We
observe corporate governance practices and have adopted principal governance
documents which are designed to ensure that we maximize stockholder value in a
manner that is consistent with both the legal requirements applicable to us and
a business model that requires our employees to conduct business with the
highest standards of integrity. Our Board of Directors has adopted and adheres
to corporate governance principles which the Board of Directors and senior
management believe promote this purpose, are sound and represent best practices,
and will review these governance practices, the corporate laws of the State of
Delaware under which we are incorporated and the regulations of the SEC, as well
as best practices recognized by governance authorities to benchmark the
standards under which it operates. Our principal governance documents are as
follows:
|
·
|
Corporate
Governance Guidelines;
|
|
·
|
Board
of Directors committee charters,
including:
|
|
•
|
Audit
Committee charter;
|
|
•
|
Nominating
Committee charter;
|
|
•
|
Compensation
Committee charter;
|
|
•
|
Corporate
Governance Committee charter; and
|
|
·
|
Code
of Business Conduct and Ethics.
|
Our
governance documents are available on our website at
www.ctmholdings.com.
Our Board
of Directors, with assistance from its Corporate Governance Committee, will
regularly assess our governance practices in light of legal requirements and
governance best practices.
9
Executive
Director Sessions
Under our
Corporate Governance Guidelines, the non-employee directors meet in regularly
scheduled executive sessions without management.
Communications
with the Board of Directors
Stockholders
and other interested persons seeking to communicate directly with the Board of
Directors, the independent directors as a group or any of the Audit,
Compensation, Nominating or Corporate Governance Committees of the Board of
Directors, should submit their written comments c/o Corporate Secretary, Leslie
B. Rozner, Stockholder Communications at our principal executive offices at 11
Largo Drive South, Stamford, Connecticut 06907 and should indicate in the
address whether the communication is intended for the Chairman of the Board, the
Independent Directors or a Committee Chair. The Chairman of the Board will
review any such communication at the next regularly scheduled Board of Directors
meeting unless, in his or her judgment, earlier communication to the Board of
Directors is warranted.
If a
stockholder communication raises concerns about our ethical conduct of the
ethical conduct of our management, it should be sent directly to our Corporate
Secretary at our principal executive offices. The Corporate Secretary will
promptly forward a copy of any such communication to the Chairman of the Audit
Committee and, if appropriate, our Chairman of the Board, and take such actions
as they authorize to ensure that the subject matter is addressed by the
appropriate committee of the Board of Directors, by management and/or by the
full Board of Directors.
At the
direction of the Board of Directors, we reserve the right to screen all
materials sent to its directors for potential security risks, harassment
purposes or routine solicitations.
Code
of Business Conduct and Ethics
Our Board
of Directors has adopted a Code of Business Conduct and Ethics which applies to
our directors, Chief Executive Officer, Chief Financial Officer and other
Company employees.
Compliance
with Section 16(a) of the Exchange Act
Section 16(a)
of the Exchange Act requires the Company’s directors, executive officers and
persons who own more than 10% of a registered class of the Company’s securities
to file with the SEC initial reports of ownership and reports of changes in
ownership of common stock and other equity securities of the Company. Directors,
executive officers and greater than 10% shareholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) reports
they file.
As the
consummation of the Spin-Off and related distribution of the Company’s common
stock occurred after Fiscal 2009, there were no reports of ownership filed
during Fiscal Year 2009 and, therefore, no requirement to comply with any
Section 16(a) filing requirements.
RELATED
PERSON TRANSACTIONS
Review
of Related Person Transactions
On
October 14, 2009, our Board of Directors adopted a revised Statement of Policy
with Respect to Related Person Transactions (which was originally adopted August
18, 2009), which is administered by our Corporate Governance Committee. This
policy applies to any transaction or series of transactions in which (i) the
Company or a subsidiary is a participant, (ii) the amount involved exceeds the
lesser of $120,000 or 1% of the average of the Company’s total assets at year
end for the last two completed fiscal years and (iii) a Related Person has a
direct or indirect material interest. Related Persons include directors,
director nominees, executive officers, any beneficial holder of more than 5% of
any class of the Company’s voting securities, and any immediate family member of
any of the foregoing persons. Under the Policy, the Company’s legal department
will determine whether a transaction meets the requirements of a Related Person
Transaction requiring review by the Corporate Governance Committee. Transactions
that fall within this definition will be referred to the Corporate Governance
Committee for approval, ratification or other action. Based on its consideration
of all of the relevant facts and circumstances, the Corporate Governance
Committee will decide whether or not to approve such transaction and will
approve only those transactions that are in the best interests of the Company
and its stockholders. If the Company becomes aware of an
10
existing
Related Person Transaction that has not been approved under this Policy, the
matter will be referred to the Corporate Governance Committee. The Corporate
Governance Committee will evaluate all options available, including
ratification, revision or termination of such transaction.
Transactions
with Related Persons, Promoters and Certain Control Persons
All of
the following Related Person Transactions were approved in accordance with the
policy described above:
Prior to
the Spin-Off, IDT, which is controlled by Howard S. Jonas, our controlling
stockholder and Chairman of the Board, provided certain services to the entities
that became the Company’s consolidated subsidiaries. The Company and IDT entered
into the Master Services Agreement, dated September 14, 2009, pursuant to which
IDT will continue to provide, among other things, certain administrative and
other services. In addition, pursuant to the Master Services Agreement, IDT will
provide certain additional services to the Company, on an interim basis, as a
separate publicly-traded company. Such services include assistance with periodic
reports required to be filed with the SEC as well as maintaining minutes, books
and records of meetings of the Board of Directors, Audit Committee and
Compensation Committee, as well as assistance with corporate governance matters.
The cost of these services will be approximately $1.5 million per year. This
transaction was originally approved by our Board of Directors prior to the
Spin-Off and subsequently by our Corporate Governance Committee in accordance
with our Related Person Transaction policy.
DIRECTOR
COMPENSATION
Compensation
of our Named Executive Officers
Prior to
the Spin-Off, all of the named executive officers were employees of IDT and all
compensation for Fiscal 2009 disclosed in the table below was paid by IDT for
services provided by the named executive officers to our business segments and
other units of IDT. During Fiscal 2009, Howard S. Jonas served as the Chairman
of the Board of Directors of IDT, Marc Knoller served as an Executive Vice
President of IDT and Les Rozner served as the Chief Financial Officer of CTM
Media Group, Inc.
The
historical compensation of Marc Knoller and Howard S. Jonas was set by the
Compensation Committee of the Board of Directors of IDT after discussions with
management about the recommended levels and components of compensation for each
of the individuals. The historical compensation of Les Rozner was set by the
management of IDT. After the Spin-Off, the Compensation Committee of our Board
of Directors approved the compensation paid to all of our named executive
officers.
Howard S.
Jonas has an employment agreement with IDT, which is summarized in IDT’s Proxy
Statement for its 2009 Annual Meeting of Shareholders and the agreement and all
amendments to the agreement have been filed as exhibits to IDT’s reports that
have been filed with the SEC. No other named executive officers have employment
agreements with the Company or IDT. Mr. Jonas continues to serve as the Chairman
of IDT.
On
October 14, 2009, our Board of Directors granted our Chairman of the Board and
founder, Howard S. Jonas, 1.8 million restricted shares of our Class B common
stock with a market value of $1.25 million on the date of grant in lieu of a
cash base salary for the next five years. The restricted shares will vest in
equal thirds on each of October 14, 2011, October 14, 2012 and October 14, 2013.
Unvested shares would be forfeited if we terminate Mr. Jonas’ employment other
than under circumstances where the accelerated vesting applies. The shares are
subject to adjustments or acceleration based on certain corporate transactions,
changes in capitalization, or termination, death or disability of Mr. Jonas. If
Mr. Jonas is terminated by us for cause, a pro rata portion of the shares would
vest. This
11
arrangement
does not impact Mr. Jonas’ cash compensation from the date of the Spin-Off
through the pay period including the grant date. This summary of the arrangement
between us and Mr. Jonas is qualified in its entirety by the Restricted Stock
Agreement between us and Mr. Jonas, which was filed with the SEC on October 20,
2009 as Exhibit 10.01 to our Current Report on Form 8-K.
The
compensation of our executive officers is set by the Compensation Committee of
our Board of Directors after discussions with management about the recommended
levels and components of compensation for each of the individuals.
In
general, each of our executive officers receives base compensation that is
commensurate with the officer’s duties, responsibilities and compensation levels
for similarly situated individuals in comparable positions. In addition,
executive officers may receive bonus compensation and compensatory equity-based
awards.
Any bonus
compensation to executive officers is determined by our Compensation Committee
based on factors it deems appropriate, including the achievement of specific
performance targets and our financial and business performance. No such targets
have yet been established. However, our Compensation Committee approved a
$15,000 bonus to Mr. Rozner which was granted upon the consummation of the
Spin-Off.
Equity
compensation awards to our Board of Directors, our management and our employees
are generally granted pursuant to our 2009 Stock Option and Incentive Plan at
levels determined by the Compensation Committee. No grants have been made nor
has the Company agreed to any specific grant or level of grants. The plan is
administered by our Compensation Committee.
COMPENSATION
OF EXECUTIVE OFFICERS
The
following tables set forth information concerning all cash compensation awarded
to, earned by or paid to all individuals serving as our principal executive
officers during the last three completed fiscal years, and all non-cash
compensation awarded to those same individuals as of July 31, 2009.
Summary
Compensation Table
|
SUMMARY
COMPENSATION TABLE (With respect to IDT Corporation)
|
||||||||||||||||||||||||||
|
Name
and Principal Position
|
Fiscal
Year
|
Salary
|
Bonus
|
Stock
Awards(1)
|
Option
Awards(1)
|
All
Other
Compensation
|
Total
|
|||||||||||||||||||
|
Marc
Knoller
Chief
Executive Officer and Director
|
2009
|
$ | 495,384 | (2) | — | — | $ | 39,204 | $ | 30,099 | (3) | $ | 564,687 | |||||||||||||
|
Howard
S. Jonas
Chairman
of the Board
|
2009
|
$ | 345,740 | $ | 925,000 | $ | 480,587 | — | $ | 33,217.02 | (4) | $ | 1,754,544 | |||||||||||||
|
Leslie
B. Rozner
Chief
Financial Officer, Treasurer and Corporate Secretary
|
2009
|
$ | 104,031 | (5) | — | — | — | — | $ | 104,031 | ||||||||||||||||
|
(1)
|
The
amounts shown in this column reflect the dollar amounts recognized by IDT
for stock option and restricted stock awards for financial statement
reporting purposes in accordance with FAS 123R. In valuing such awards,
IDT made certain assumptions. For a discussion of those assumptions,
please see Note 1 to the Consolidated Financial Statements included in
IDT’s Annual Report on Form 10-K for the Fiscal Year ended July 31,
2008.
|
|
(2)
|
Mr.
Knoller’s salary has been approved by our Compensation Committee at
$495,384 for Fiscal 2010.
|
|
(3)
|
Represents
$1,099 paid for life insurance premiums, $2,728 of earnings distributed to
Mr. Knoller under IDT’s Key Employee Share Option Plan, $4,545 paid
for long-term disability insurance premiums, and $1,725 matching
contribution to Mr. Knoller’s IDT stock account established under the IDT
401(k) plan and invested in IDT’s
stock.
|
12
|
(4)
|
Represents
$1,492 paid for life insurance premiums, and $1,725 matching contribution
to Mr. Jonas’s IDT stock account established under the IDT 401(k) plan and
invested in IDT’s stock.
|
|
(5)
|
Mr.
Rozner’s annual salary has been raised by our Compensation Committee to
$150,000 for Fiscal 2010.
|
WHERE
YOU CAN OBTAIN ADDITIONAL INFORMATION
Our
internet address is www.ctmholdings.com and the Investor Relations section of
our web site is located at http://ir.ctmholdings.com. We make available free of
charge, on the Investor Relations section of our web site, annual reports on
Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and
amendments to those reports filed or furnished pursuant to Section 13(a) or
15(d) of the Exchange Act, as well as information statements, as soon as
reasonably practicable after we electronically file such material with, or
furnish it to, the SEC. Also posted on our website, and available in print upon
request of any stockholder to our Corporate Secretary, Leslie B. Rozner, are our
certificate of incorporation and by-laws and our Code of Business Conduct and
Ethics governing our directors, officers and employees. Within the time period
required by the SEC, we will post to our website any amendment to the Code of
Business Conduct and Ethics and any waiver applicable to any executive officer,
director or senior financial officer (as defined in the Code).
Availability
of Annual Report on Form 10-K
We filed
with the SEC our Annual Report for the fiscal year ended July 31, 2009 on Form
10-K on October 29, 2009. A copy of the Form 10-K has been made available on the
Internet or mailed to all stockholders along with this Information Statement.
Additional copies of our Annual Report on Form 10-K may be obtained by
contacting our Corporate Secretary, Leslie B. Rozner, at CTM Media Holdings,
Inc., 11 Largo Drive South, Stamford, Connecticut 06907, telephone: (203)
323-5161, email: lrozner@ctmmedia.com.
13
WE
ARE NOT ASKING YOU FOR A PROXY AND
YOU
ARE NOT REQUESTED TO SEND US A PROXY.
IMPORTANT
NOTICE REGARDING THE AVAILABILITY OF THE INFORMATION STATEMENT
FOR
CTM MEDIA HOLDINGS, INC.
The
Information Statement and the 2009 Annual Report are available at:
http://ir.ctmholdings.com/annualmeeting
November
24, 2009
BY ORDER
OF THE BOARD OF DIRECTORS
Howard S.
Jonas
Chairman
of the Board
14