UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
SCHEDULE
14A
Proxy
Statement Pursuant to Section
14(a)
of
the Securities Exchange
Act
of
1934 (Amendment No. __)
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 toss. 240.14a-12
Track
Data Corporation
(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)(4) 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:
95
Rockwell Place
Brooklyn,
NY 11217
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
TO
BE HELD NOVEMBER 9, 2006
To
the Stockholders of Track Data Corporation:
The
Annual Meeting of Stockholders of Track Data Corporation (the "Company") will
be
held at 95 Rockwell Place, Brooklyn, New York 11217, Fifth Floor Conference
Room, at 10:00 A.M. on Thursday, November 9, 2006, for the following
purposes:
|
(1)
|
To
elect eight Directors of the Company to hold office until the next
Annual
Meeting of Stockholders and until their successors have been duly
elected
and qualified;
|
|
(2)
|
To
ratify the selection and appointment by the Company's Board of Directors
of Marcum & Kliegman LLP, independent auditors, as auditors for the
Company for the year ending December 31, 2006;
and
|
|
(3)
|
To
consider and transact such other business as may properly come before
the
meeting or any adjournments
thereof.
|
A
Proxy
Statement, form of Proxy and the Annual Report to Stockholders of the Company
for the year ended December 31, 2005 are enclosed herewith. Only holders of
record of Common Stock at the close of business on September 20, 2006 will
be entitled to notice of and to vote at the Annual Meeting and any adjournments
thereof. A complete list of the stockholders entitled to vote will be available
for inspection by any stockholder during the meeting; in addition, the list
will
be open for examination by any stockholder, for any purpose germane to the
meeting, during ordinary business hours, for a period of at least ten days
prior
to the meeting at the office of the Secretary of the Company, located at 95
Rockwell Place, Brooklyn, New York 11217.
Brooklyn,
New York By
Order
of the Board of Directors,
September
25, 2006
Martin
Kaye
Secretary
All
stockholders are cordially invited to attend the Meeting. If you do not expect
to be present, please sign and date the enclosed form of Proxy and return it
promptly using the enclosed envelope. No postage is required if mailed in the
United States. Any person giving a Proxy has the power to revoke it at any
time
prior to its exercise and if present at the Meeting may withdraw it and vote
in
person. Attendance at the Meeting is limited to stockholders, their proxies
and
invited guests of the Company.
TRACK
DATA CORPORATION
95
ROCKWELL PLACE
BROOKLYN,
NEW YORK 11217
PROXY
STATEMENT
This
Proxy Statement is furnished in connection with the solicitation by the Board
of
Directors of Track Data Corporation (the "Company") of proxies in the form
enclosed. Such Proxies will be voted at the Annual Meeting of Stockholders
of
the Company to be held at 95 Rockwell Place, Brooklyn, New York, 11217, Fifth
Floor Conference Room, at 10:00 A.M. on Thursday, November 9, 2006 (the
"Meeting") and at any adjournments thereof for the purposes set forth in the
accompanying Notice of Annual Meeting of Stockholders.
This
Proxy Statement and accompanying Proxy are being mailed on or about September
25, 2006 to all stockholders of record on September 20, 2006 (the "Record
Date").
Any
stockholder giving a Proxy has the power to revoke the same at any time before
it is voted. The cost of soliciting Proxies will be borne by the Company. The
Company has no contract or arrangement with any party in connection with the
solicitation of proxies. Following the mailing of the Proxy materials,
solicitation of Proxies may be made by officers and employees of the Company
by
mail, telephone, telegram or personal interview. Properly executed Proxies
will
be voted in accordance with instructions given by stockholders at the places
provided for such purpose in the accompanying Proxy. Unless contrary
instructions are given by stockholders, it is intended to vote the shares
represented by such Proxies for
the
election of the eight nominees for director named herein and for
the
selection of Marcum & Kliegman LLP as independent auditors. The current
members of the Board of Directors presently hold voting authority for Common
Stock representing an aggregate of 4,756,888 votes, or approximately 57% of
the
total number of votes eligible to be cast at the Annual Meeting. The members
of
the Board of Directors have indicated their intention to vote affirmatively
on
all of the proposals.
VOTING
SECURITIES
Stockholders
of record as of the close of business on the Record Date will be entitled to
notice of, and to vote at, the Meeting or any adjournments thereof. On the
Record Date there were 8,373,279 outstanding shares of common stock, par value
$.01 per share (the "Common Stock"). Each holder of Common Stock is entitled
to
one vote for each share held by such holder. The presence, in person or by
proxy, of the holders of a majority of the outstanding shares of Common Stock
is
necessary to constitute a quorum at the Meeting. Proxies submitted which contain
abstentions or broker non-votes will be deemed present at the Meeting in
determining the presence of a quorum.
1
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth, as of August 31, 2006, information regarding the
beneficial ownership (as defined in Rule 13d-3 under the Securities Exchange
Act
of 1934) of the Company's Common Stock based upon the most recent information
available to the Company for (i) each person known by the Company to own
beneficially more than five (5%) percent of the Company's outstanding Common
Stock, (ii) each of the Company's officers and directors and (iii) all officers
and directors of the Company as a group. Unless otherwise indicated, each
stockholder's address is c/o the Company, 95 Rockwell Place, Brooklyn, New
York
11217.
|
Shares
Owned Beneficially (1)
|
||||||||
|
Name
|
No.
of Shares
|
%
of Class
|
||||||
|
Barry
Hertz (2)
|
5,302,775
|
59.
|
1%
|
|||||
|
Martin
Kaye (3)
|
177,680
|
2.
|
1%
|
|||||
|
Stanley
Stern (4)
|
31,953
|
*
|
||||||
|
Albert
Drillick (5)
|
41,780
|
*
|
||||||
|
Abraham
Biderman (6)
|
24,000
|
*
|
||||||
|
E.
Bruce Fredrikson (7)
|
29,600
|
*
|
||||||
|
Philip
Ort (6)
|
14,000
|
*
|
||||||
|
Shaya
Sofer (6)
|
14,000
|
*
|
||||||
|
All
Officers and Directors as a Group
|
||||||||
|
(eight
persons)(8)
|
5,635,788
|
60.
|
9%
|
|||||
---------------
*
= less
than 1%
|
(1)
|
Unless
otherwise indicated, (i) each person has sole investment and voting
power
with respect to the shares indicated and (ii) the shares indicated
are
currently outstanding shares. For purposes of this table, a person
or
group of persons is deemed to have "beneficial ownership" of any
shares as
of a given date which such person has the right to acquire within
60 days
after such date. For purposes of computing the percentage of outstanding
shares held by each person or group of persons named above on a given
date, any security which such person or persons has the right to
acquire
within 60 days after such date is deemed to be outstanding for the
purpose
of computing the percentage ownership of such person or persons,
but is
not deemed to be outstanding for the purpose of computing the percentage
ownership of any other person. Subject to the foregoing, the percentages
are calculated based on 8,373,279 shares
outstanding.
|
|
(2)
|
Consists
of 4,049,906 shares owned by Mr. Hertz, 633,880 shares owned by Trusts
established in the names of Mr. Hertz’s children and 18,989 shares held by
a family LLC managed by Mr. Hertz who owns 8% of such LLC. Mr. Hertz
disclaims beneficial interest in shares owned by the Trust and 92%
of the
family LLC not owned by him. Also includes 600,000 shares issuable
upon
the exercise of presently exercisable options under the Company’s Stock
Option Plans.
|
|
(3)
|
Consists
of 7,680 shares owned of record and 170,000 shares issuable upon
the
exercise of presently exercisable options granted under the Company's
Stock Option Plans.
|
|
(4)
|
Consists
of 9,953 shares owned of record and 22,000 shares issuable upon the
exercise of presently exercisable options granted under the Company's
Stock Option Plans.
|
|
(5)
|
Consists
of 30,220 shares owned of record jointly with his wife, 660 shares
owned
by a trust in the name of his child, and 10,900 shares issuable upon
the
exercise of presently exercisable options granted under the Company's
Stock Option Plans.
|
|
(6)
|
Consists
of shares issuable upon the exercise of presently exercisable options
granted under the Company’s Stock Option
Plans.
|
|
(7)
|
Consists
of 5,600 shares owned of record and 24,000 shares issuable upon the
exercise of presently exercisable options granted under the Company's
Stock Option Plans.
|
|
(8)
|
Consists
of 4,756,888 outstanding shares and 878,900 shares issuable upon
exercise
of options described in footnotes 2 through 7 above.
|
2
ITEM
I. ELECTION OF DIRECTORS
It
is the
intention of the persons named in the enclosed form of Proxy, unless such form
of Proxy specifies otherwise, to nominate and to vote the shares represented
by
such Proxy for
the
election as directors of Barry Hertz, Martin Kaye, Stanley Stern, Albert
Drillick, Abraham Biderman, Dr. E. Bruce Fredrikson, Phillip Ort and Shaya
Sofer
to hold office until the next Annual Meeting of Stockholders or until their
respective successors shall have been duly elected and qualified. All of the
nominees are presently directors of the Company. The Company has no reason
to
believe that any of the nominees will become unavailable to serve as directors
for any reason before the Annual Meeting. However, in the event that any of
them
shall become unavailable, the person designated as proxy reserves the right
to
substitute another person of his choice when voting at the Annual
Meeting.
Officers
and Directors
The
officers and directors of the Company are as follows:
|
Name
|
Age
|
Position
|
||
|
|
||||
|
Barry
Hertz
|
56
|
Chairman
of the Board, Chief Executive Officer
|
||
|
Martin
Kaye
|
59
|
Chief
Operating Officer, Chief Financial Officer,
|
||
|
Secretary
and Director
|
||||
|
Stanley
Stern
|
56
|
Chief
Compliance Officer, TDSC, Director
|
||
|
Albert
Drillick
|
60
|
Senior
Systems Analyst, Director
|
||
|
Abraham
Biderman
|
58
|
Director
|
||
|
E.
Bruce Fredrikson
|
68
|
Director
|
||
|
Philip
Ort
|
57
|
Director
|
||
|
Shaya
Sofer
|
57
|
Director
|
Barry
Hertz has
served as the Company's Chairman and Chief Executive Officer since its
inception. He holds a Masters degree in Computer Science from New York
University (1973) and a B.S. degree in Mathematics from Brooklyn College (1971).
Until his resignation in May 2001, Mr. Hertz also served as Chairman of Innodata
Corporation ("Innodata"), a public company co-founded by Mr. Hertz, of which
the
Company was a principal stockholder, and which is a global outsourcing provider
of Internet and on-line digital content services.
Martin
Kaye
has been
Chief Operating Officer since August 2001, and has been Chief Financial Officer,
Secretary and a Director of the Company since 1994. Mr. Kaye is a certified
public accountant. Mr. Kaye served as Chief Financial Officer of Innodata from
October 1993 and Director from March 1995 until his resignation from those
positions in May 2001. He had been an audit partner with Deloitte & Touche
LLP for more than five years until his resignation in 1993. Mr. Kaye holds
a
B.B.A. in accounting from Baruch College (1970).
3
Stanley
Stern
has been
Chief Compliance Officer of the Company’s broker-dealer subsidiary, TDSC, since
April, 2005. He served as Senior Vice President - Customer Relations from June
2000 to November 2005. He has been a Director of the Company since May 1999.
He
previously served as Director from April 1994 until his resignation in September
1997. He served as Vice President of the Company and in other capacities for
more than five years until his resignation in December 1996. From January 1998
through May 2000, Mr. Stern was Chief Operating Officer of Integrated Medical
Technologies, Inc., an Internet-based provider of medical services information.
Mr. Stern holds a B.B.A. from Baruch College (1973).
Albert
Drillick
has been
a Director of the Company since February 2004. He has served as a Director
of
Applications and Senior Systems Analyst for the Company for more than the past
five years. He holds a Ph.D. degree in Mathematics from New York University
Courant Institute (1971).
Abraham
Biderman
has been
a Director of the Company since August 2002. Mr. Biderman is Chairman of Eagle
Advisers, LLC, a diversified financial services and money management firm.
From
January 1990 to September 2003, he was Executive Vice President of Lipper &
Company, Inc., a diversified financial services firm. Prior thereto, he served
as special advisor to the Deputy Mayor and then the Mayor during New York City's
Koch Administration. From January 1988 through December 1989, Mr. Biderman
was
Commissioner of New York City's Department of Housing, Preservation and
Development. Prior thereto, he served as Commissioner of New York City's
Department of Finance and as Chairman of New York City's Employee Retirement
System. Mr. Biderman is a member of the Fiscal Opportunities Task Force of
the
New York City Partnership, a member of the Housing Committee of the Real Estate
Board of New York, a Director of m-Phase Technologies, Inc., a company that
manufactures and markets high-bandwidth telecommunications products
incorporating DSL technology, and is also on the boards of numerous
not-for-profit and philanthropic organizations. Mr. Biderman is a certified
public accountant and graduated with a B.A. in Accounting from Brooklyn College
(1970).
Dr.
E. Bruce Fredrikson
has been
a Director of the Company since June 1994. Dr. Fredrikson is currently an
independent consultant in corporate finance and governance. He is Professor
of
Finance, Emeritus, at Syracuse University's Martin J. Whitman School of
Management where he taught from 1966 until his retirement in May 2003. He is
a
director of Consumer Portfolio Services, Inc., a consumer finance company,
and
Colonial Commercial Corp, a supplier of HVAC products and supplies. Dr.
Fredrikson holds an A.B. in economics from Princeton University and a M.B.A.
in
accounting and a Ph.D. in finance from Columbia University.
Philip
Ort
has been
a Director of the Company since June 2004. Mr. Ort has been the owner/operator
of a family Real Estate Management and Investment business comprising
residential and commercial properties since 1972. He serves on the boards of
several non-profit organizations. He attended Brooklyn College from 1967 to
1970.
Shaya
Sofer
has been
a director of the Company since June 2004. Since January 2001, he has been
Senior Managing Project Director of Energy Spectrum Inc., an energy consulting
firm focusing on CHP "Combine Heat and Power" (Cogeneration). Prior thereto,
he
was a consultant. He served as Director of Facilities for Track Data Corp.
and
as Executive Vice President of Fast Track Systems, a disaster recovery business,
from 1985 through 1998. He also was a member of the board of directors of Track
Data Corp. from 1986 through 1995, prior to its merger with Global Market
Information, Inc. Mr. Sofer holds a B.A. in Mathematics from Queens College
(1972).
4
Directors
are elected to serve until the next annual meeting of stockholders and until
their successors are elected and qualified. Officers serve at the discretion
of
the Board. There are no family relationships among directors or officers. Albert
Drillick is the father of David Drillick, Chief Operating Officer of TDSC,
the
Company’s broker-dealer subsidiary.
Director
Independence
The
Board
of Directors has determined each of the following directors to be an
“independent director” as defined in Rule 4200(a)(15) of the listing standards
of the National Association of Securities Dealers (“the NASD listing
standards”): E. Bruce Fredrikson, Abraham Biderman, Phillip Ort and Shaya Sofer.
Controlled
Company Exemption
The
Company is a Controlled Company as defined in NASDAQ’s Stock Market Rule
4350(c)(5) as the Company is owned more than 50% by one individual. Accordingly,
a majority of independent directors is not required to serve on the Company’s
Board of Directors.
Meetings
of the Board of Directors
The
Board
of Directors held four meetings during the year ended December 31, 2005.
During
2005, each director attended in excess of 75% of both (i) the total number
of
board meetings held during the period for which he was a director and (ii)
the
total number of meetings of each committee of the board on which the director
served during the period for which he was on the committee. The Company does
not
have a policy requiring incumbent directors and director nominees to attend
the
Company’s annual meeting of stockholders. All directors attended last year's
annual meeting.
Audit
Committee
The
Company has a separately designated standing audit committee established in
accordance with Section 3(a)(58)(A) of the Exchange Act. Serving on the
Committee are Dr. E. Bruce Fredrikson, Abraham Biderman and Philip Ort. The
Board of Directors has determined that it has an audit committee financial
expert serving on the audit committee, Abraham Biderman. Mr. Biderman is an
independent director as defined in Item 7(d)(3)(iv) of Schedule 14A. The
function of the Audit Committee is to make recommendations concerning the
selection each year of independent auditors of the Company, to review the
effectiveness of the Company's internal accounting methods and procedures,
to
consider whether the principal accountant’s provision of non-audit services is
compatible with maintaining the principal accountant’s independence and to
determine through discussions with the independent auditors whether any
instructions or limitations have been placed upon them in connection with the
scope of their audit or its implementation. The Audit Committee met four times
during 2005. The Board of Directors has determined that the members of the
Audit
Committee are "independent" as defined in NASDAQ Stock Market’s Marketplace Rule
4200.
The
Board
of Directors does not have a Compensation Committee. In accordance with NASDAQ
Stock Market’s Marketplace Rule 4200, a majority of “independent” directors is
required to recommend and approve the compensation of executive
officers.
5
The
Company does not have a standing Nominating Committee. Due to the size of the
Company and the resulting efficiency of a Board of Directors that is also
limited in size, as well as the lack of turnover in the Company’s Board of
Directors, the Board of Directors has determined that it is not necessary or
appropriate at this time to establish a separate Nominating Committee. Potential
candidates are discussed by the entire Board of Directors, and director nominees
are selected by Board of Director resolution subject to the recommendation
of a
majority of the independent directors. All of the nominees recommended for
election to the Board of Directors at the Annual Meeting are directors standing
for re-election. Although the Board of Directors has not established any minimum
qualifications for director candidates, when considering potential director
candidates, the Board considers the candidate's character, judgment, diversity,
skills, including financial literacy, and experience in the context of the
needs
of the Company and the Board of Directors. In 2005, the Company did not pay
any
fees to any third party to assist in identifying or evaluating potential
nominees.
Report
of the Audit Committee
The
following report of the Audit Committee does not constitute soliciting material
and should not be deemed filed or incorporated by reference into any other
Company filing under the Securities Act of 1933 or the Securities Exchange
Act
of 1934, except to the extent the Company specifically incorporates this Report
by reference therein.
The
responsibilities of the Audit Committee, which are set forth in the Audit
Committee Charter, include providing oversight to the Company's financial
reporting process through periodic meetings with the Company’s independent
accountants and management to review accounting, auditing, internal controls
and
financial reporting matters. The Audit Committee is also responsible for the
appointment, compensation and oversight of the Company’s independent auditors.
The management of the Company is responsible for the preparation and integrity
of the financial reporting information and related systems of internal controls.
The Audit Committee, in carrying out its role, relies on the Company's senior
management, including senior financial management, and its independent
accountants.
The
Audit
Committee has implemented procedures to ensure that during the course of each
fiscal year it devotes the attention that it deems necessary or appropriate
to
each of the matters assigned to it under the Audit Committee’s Charter. To carry
out its responsibilities, the Audit Committee met four times during fiscal
2005.
6
The
primary purpose of the Audit Committee is to assist the Board of Directors
in
fulfilling its oversight responsibilities relating to the quality and integrity
of the Company’s financial reports and financial reporting processes and systems
of internal controls. Management of the Company has primary responsibility
for
the Company’s financial statements and the overall reporting process, including
maintenance of the Company’s system of internal controls. The Company retains
independent auditors who are responsible for conducting an independent audit
of
the Company’s financial statements, in accordance with generally accepted
auditing standards, and issuing a report thereon.
On
the
basis of the foregoing reviews and discussions, 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 December 31,
2005, for filing with the Securities and Exchange Commission. The Audit
Committee has also recommended, subject to shareholder approval, the selection
of the Company's independent auditors.
Audit
Committee
E.
Bruce
Fredrikson
Abraham
Biderman
Philip
Ort
Code
of Ethics
The
Company has adopted a Code of Ethics that applies to its Chief Executive Officer
and Chief Financial Officer. The Code as well as any amendments and waivers
of
the Code, if any, is posted on the Company’s website at
http://www.trackdata.com/codeofethics.
7
Compliance
With Section 16(a) of the Securities Exchange Act of 1934
The
Company believes that during the period from January 1, 2005 through December
31, 2005 all Section 16(a) filing requirements applicable to its officers,
directors and greater than ten-percent beneficial owners were complied
with.
Stockholders
Communications With the Board of Directors
Generally,
stockholders who have questions or concerns regarding the Company should contact
our Investor Relations department at 718-522-7373. However, stockholders may
communicate with the Board of Directors by sending a letter to Board of
Directors of Track Data Corporation, c/o Corporate Secretary, 95 Rockwell Place,
Brooklyn, NY 11217. Any communications must contain a clear notation indicating
that it is a "Stockholder--Board Communication" or a "Stockholder--Director
Communication" and must identify the author as a stockholder. The office of
the
Corporate Secretary will receive the correspondence and forward appropriate
correspondence to the Chairman of the Board or to any individual director or
directors to whom the communication is directed. The Company reserves the right
not to forward to the Board of Directors any communication that is hostile,
threatening, illegal, does not reasonably relate to the Company or its business,
or is similarly inappropriate. The office of the Corporate Secretary has
authority to discard or disregard any inappropriate communication or to take
any
other action that it deems to be appropriate with respect to any inappropriate
communications.
Executive
Compensation
The
following table sets forth information with respect to compensation paid by
the
Company for services to it during the three fiscal years ended December 31,
2005
to the Company's Chief Executive Officer and to the executive officers whose
aggregate annual salary and bonus exceeded $100,000 in 2005.
Summary
Compensation Table
|
Fiscal
|
Annual
|
Number
of Stock
|
||||||||
|
Name
and Position
|
|
Year
|
Salary
|
Bonus
|
Options
Awarded
|
|||||
|
|
|
|
|
|
||||||
|
Barry
Hertz
|
2005
|
$454,500
|
-
|
-
|
||||||
|
Chairman,
CEO
|
2004
|
$450,000
|
-
|
-
|
||||||
|
2003
|
$450,000
|
-
|
100,
|
000
|
(A)
|
|||||
|
Martin
Kaye
|
2005
|
$303,000
|
-
|
50,
|
000
|
|||||
|
Chief
Operating Officer,
|
2004
|
$300,000
|
-
|
-
|
||||||
|
Chief
Financial Officer
|
2003
|
$300,000
|
-
|
40,
|
000
|
(A)
|
||||
|
Key
Employees
|
||||||||||
|
|
||||||||||
|
Stanley
Stern
|
2005
|
$154,500
|
-
|
10,
|
000
|
|||||
|
Senior
Vice President until December 1, 2005,
|
2004
|
$153,000
|
-
|
-
|
||||||
|
Chief
Compliance Officer of TDSC since
|
2003
|
$153,000
|
-
|
4,
|
000
|
(A)
|
||||
|
April
1, 2005
|
||||||||||
|
David
Drillick
|
2005
|
$165,000
|
$9,000
|
10,
|
000
|
|||||
|
Chief
Operating Officer of TDSC
|
||||||||||
|
since
December 1, 2005
|
||||||||||
(A)
Granted in March, 2004 for the 2003 calendar year.
The
above
table does not include certain perquisites and other personal benefits, the
total value of which does not exceed the lesser of $50,000 or 10% of such
person's compensation.
8
Option
Grants In Last Fiscal Year
Individual
Grants
|
Percent
of
|
Potential
Realized
|
|||||||||||||
|
Total
Options
|
Value
at Assumed
|
|||||||||||||
|
Granted
to
|
Annual
Rates of
|
|||||||||||||
|
Number
of
|
Employees
|
Stock
Appreciation
|
||||||||||||
|
Options
|
in
Fiscal
|
Exercise
|
Expiration
|
for
Option Term
|
||||||||||
|
Name
|
Granted
|
Year
|
Price
|
Date
|
5%
|
10%
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
Barry
Hertz
|
None
|
|||||||||||||
|
Martin
Kaye
|
50,000
|
25%
|
$3.00
|
12/27/2010
|
$41,500
|
$91,500
|
||||||||
|
Stanley
Stern
|
10,000
|
5%
|
$3.00
|
12/27/2010
|
$8,300
|
$18,300
|
||||||||
|
David
Drillick
|
10,000
|
5%
|
$3.00
|
12/27/2010
|
$8,300
|
$18,300
|
||||||||
Aggregate
Option Exercises in Last Fiscal Year;
Fiscal
Year End Option Values
|
Number
of Securities
|
Value
of Unexercised In-
|
|||||||||
|
Underlying
Unexercised
|
the-Money
Options at
|
|||||||||
|
Shares
|
Options
at Fiscal
|
Fiscal
Year End
|
||||||||
|
Acquired
on
|
Value
|
Year
End
|
Exercisable/
|
|||||||
|
Name
|
Exercise
|
Realized
|
Exercisable/Unexercisable
|
Unexercisable
|
||||||
|
Barry
Hertz
|
None
|
-
|
600,000/0
|
$-0-/$-0-
|
||||||
|
Martin
Kaye
|
None
|
-
|
170,000/0
|
$-0-/$-0-
|
||||||
|
Stanley
Stern
|
None
|
-
|
22,000/0
|
$-0-/$-0-
|
||||||
|
David
Drillick
|
None
|
-
|
21,000/0
|
$-0-/$-0-
|
There
are
no employment agreements, stock appreciation rights, pension plans or long-term
incentive plans.
Equity
Compensation Plan Information
All
equity compensation plans have been approved by the Company's
stockholders.
|
At
December 31, 2005
|
||
|
a)
|
Number
of securities to be issued upon exercise of outstanding
|
1,260,000
|
|
options
|
||
|
b)
|
Weighted-average
exercise price of outstanding options
|
$6.42
|
|
c)
|
Number
of securities remaining available for future issuance
|
|
|
under
equity compensation plans (excluding securities
|
||
|
reflected
in (a) above)
|
759,000
|
|
9
Directors
Compensation
Messrs.
Biderman, Fredrikson, Ort and Sofer are compensated at the rate of $1,250 per
month, plus $500 out-of-pocket expenses for each meeting attended. No other
director is paid cash compensation for his services as director.
In
2005,
Messrs. Biderman, Fredrikson, Ort and Sofer each received five-year options
to
purchase 10,000 shares at an exercise price of $3.05 per share, exercisable
immediately upon grant.
Compensation
Committee Interlocks and Insider Participation
For
the
Company's fiscal year ended December 31, 2005, Messrs. Hertz and Kaye were
officers of the Company and were members of the Board of Directors (there is
no
compensation committee).
Board
Report on Executive Compensation
The
following is the Board’s compensation policy: The Board of Directors (the
"Board") is responsible for determining the annual salary, short-term and
long-term incentive compensation, stock awards and other compensation of the
executive officers. In its deliberations regarding compensation of executive
officers, including the chief executive officer, the Board considered the
following factors: (a) Company performance, both separately and in relation
to
similar companies, (b) the individual performance, experience and scope of
responsibilities of each executive officer, (c) compensation and stock award
information disclosed in the proxy statements of other companies, (d) historical
compensation levels and stock awards at the Company, (e) the overall competitive
environment for executives and the level of compensation necessary to attract
and retain executive talent and (f) the recommendations of management. The
assessments were not subject to specific weightings or formulas.
Board
Members
Barry
Hertz
Martin
Kaye
Stanley
Stern
Albert
Drillick
E.
Bruce
Fredrikson
Abraham
Biderman
Philip
Ort
Shaya
Sofer
Principal
Accountant Fees and Services
Audit
Fees.
The
audit
fees for 2005 and 2004 were $100,000 for Marcum & Kliegman LLP and $200,000
for Grant Thornton LLP, respectively. All services provided by independent
accountants were approved by the audit committee.
10
Tax
Fees.
Tax
fees
consisted of consulting and preparation of tax returns. The fees were $25,000
in
2005 and 2004 for Marcum & Kliegman LLP.
Audit
Committee Pre-Approval Policies and Procedures.
The
Audit
Committee is directly and solely responsible for oversight, engagement and
termination of any independent auditor employed by the Company for the purpose
of preparing or issuing an audit report or related work.
The
Committee:
Meets
with the independent auditor prior to the audit and discusses the planning
and
staffing of the audit;
Approves
in advance the engagement of the independent auditor for all audit services
and
non-audit services and approves the fees and other terms of any such
engagement;
Obtains
periodically from the independent auditor a formal written statement of the
matters required to be discussed by Statement of Auditing Standards No. 61,
as
amended, and, in particular, describing all relationships between the auditor
and the Company; and
Discusses
with the auditor any disclosed relationships or services that may impact auditor
objectivity and independence.
STOCK
PRICE PERFORMANCE GRAPH
The
following performance graph compares the cumulative total return (assuming
reinvestment of dividends) of an investment of $100 in Track Data Corporation
on
January 1, 2001 and held through December 31, 2005 to the Nasdaq Market Index
and the Industry Index for SIC Code 7375, Information Retrieval
Services.
INFORMATION
PROVIDED BY MEDIA GENERAL FINANCIAL SERVICES.
11
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
The
Company leases its executive office facilities in Brooklyn from a limited
partnership owned by the Company’s Chairman and members of his family. The
Company paid the partnership rent of $623,000 and $600,000 for the years ended
December 31, 2005 and 2004, respectively. The lease provides for the Company
to
pay $630,000 per annum through April 1, 2006. The Company has continued to
pay
rent at the same rate after April 1, 2006 without a new lease.
In
connection with the Company's arbitrage trading program, the Company's Chairman
pledged approximately 1.8 million shares of his holdings of the Company's common
stock as additional collateral for the arbitrage trading accounts. The Company
is paying its Chairman at the rate of 2% per annum on the value of the
collateral pledged. Such payments aggregated $44,000 and $87,000 for the years
ended December 31, 2005 and 2004, respectively.
The
Company's Chairman had a margin loan of approximately $3 million as a customer
of the Company's broker-dealer that was collateralized by 2.5 million of the
Company's shares owned by him. The loan was repaid in November
2005.
In
2005
and 2004, the Company's Chairman sold 300,000 and 4,000 shares of the Company's
common stock to the Company for $837,000 and $16,000, respectively.
The
Company has an employee savings program under which employees may make deposits
and receive interest at the prime rate. As of December 31, 2005, the Company’s
Chief Financial Officer had deposits in the program of $328,000 and received
interest of $16,000 and $6,000 during the years ended December 31, 2005 and
2004, respectively.
In
2005,
the Company granted five-year options to purchase an aggregate of 102,500 shares
to its officers and directors at exercise prices of $3.00 - $3.05 per share,
the
market value at date of grant. The options are exercisable
immediately.
CHANGE
IN INDEPENDENT PUBLIC ACCOUNTANT
On
January 17, 2006, the Audit Committee of the Board of Directors of the Company
dismissed Grant Thornton LLP ("GT") as the Company's independent registered
public accounting firm. The decision to change accountants was made unanimously
by the Company's Audit Committee.
The
audit
reports of GT on the Company's financial statements for the years ended December
31, 2004 and 2003 did not contain an adverse opinion or a disclaimer of opinion
and were not qualified or modified as to uncertainty, audit scope or accounting
principle. During the two years ended December 31, 2004 and through January
17,
2006, there have been no disagreements with GT on any matter of accounting
principles or practices, financial statement disclosures, or auditing scope
or
procedures, which disagreements, if not resolved to the satisfaction of GT,
would have caused GT to make reference to the subject matter of the disagreement
in connection with its reports on the financial statements for such periods.
During the two years ended December 31, 2004 and through January 17, 2006,
there
have been no reportable events as defined in Item 304(a)(1)(v) of Regulation
S-K.
12
ITEM
II. RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Subject
to approval by the stockholders, the Board of Directors has appointed Marcum
& Kliegman LLP as the independent auditors to audit the financial statements
of the Company for the fiscal year ending December 31, 2006. Marcum &
Kliegman LLP also served as the Company's auditors for the fiscal year ended
December 31, 2005. It is expected that a representative of Marcum & Kliegman
LLP will be present at the Annual Meeting with the opportunity to make a
statement if he desires to do so and to be available to respond to appropriate
questions from stockholders.
In
the
event that the stockholders fail to ratify this appointment, other certified
public accountants will be considered upon recommendation of the Audit
Committee. Even if this appointment is ratified, our Board of Directors, in
its
discretion, may direct the appointment of a new independent accounting firm
at
any time during the year, if the Board believes that such a change would be
in
the best interest of the Company and its stockholders.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS YOU VOTE FOR RATIFICATION OF THE
APPOINTMENT OF MARCUM & KLIEGMAN LLP AS INDEPENDENT
AUDITORS
VOTE
REQUIRED
Election
of Directors.
Directors will be elected at the meeting by a plurality of the votes cast (i.e.,
the eight nominees receiving the greatest number of votes will be elected as
Directors).
Ratification
of the Appointment of Independent Auditors.
The
appointment of Marcum & Kliegman LLP as independent auditors requires the
affirmative vote of a majority of the shares present in person or represented
by
proxy at the meeting and entitled to vote on the matter. Abstentions will have
the same effect as a vote against such ratification, whereas broker non-votes
and shares not represented at the meeting will not be counted for purposes
of
determining whether such ratification has been approved.
EXPENSE
OF SOLICITATION
The
cost
of soliciting proxies, which also includes the preparation, printing and mailing
of the Proxy Statement, will be borne by the Company. Solicitation will be
made
by the Company primarily through the mail, but regular employees of the Company
may solicit proxies personally, by telephone or telegram. The Company will
request brokers and nominees to obtain voting instructions of beneficial owners
of the stock registered in their names and will reimburse them for any expenses
incurred in connection therewith.
13
PROPOSALS
OF STOCKHOLDERS
Stockholders
of the Company who intend to present a proposal for action at the next Annual
Meeting of Stockholders of the Company must notify the Company's management
of
such intention by notice in writing received at the Company's principal
executive offices on or before May 23, 2006 in order for such proposal to be
included in the Company's Proxy Statement and form of proxy relating to such
Meeting. Stockholders who wish to present a proposal for action at the next
Annual Meeting are advised to contact the Company as soon as possible in order
to permit the inclusion of any proposal in the Company's proxy
statement.
ANNUAL
REPORT
A
copy of
our Annual Report on Form 10-K for the 2005 Fiscal Year has been mailed
concurrently with this Proxy statement to all stockholders entitled to notice
of
and to vote at the Annual Meeting. The annual report is not incorporated into
the Proxy Statement and is not considered proxy solicitation
material.
OTHER
MATTERS
The
Company knows of no items of business that are expected to be presented for
consideration at the Annual Meeting which are not enumerated herein. However,
if
other matters properly come before the Meeting, it is intended that the person
named in the accompanying Proxy will vote thereon in accordance with his best
judgement.
PLEASE
DATE, SIGN AND RETURN THE PROXY CARD AT YOUR EARLIEST CONVENIENCE IN THE
ENCLOSED RETURN ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
A PROMPT RETURN OF YOUR PROXY CARD WILL BE APPRECIATED AS IT WILL SAVE THE
EXPENSE OF FURTHER MAILINGS.
Brooklyn,
New York By
Order
of the Board of Directors
September
25, 2006
Martin Kaye, Secretary
14
PROXY
TRACK
DATA CORPORATION
ANNUAL
MEETING OF STOCKHOLDERS
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The
undersigned Stockholder of Common Stock of Track Data Corporation (the
"Company") hereby revokes all previous proxies, acknowledges receipt of the
Notice of the Meeting of Stockholders to be held on Thursday, November 9, 2006
and hereby appoints Barry Hertz and Martin Kaye, and each of them, as proxies
of
the undersigned, with full power of substitution, to vote and otherwise
represent all of the shares of the undersigned in the Company at said meeting
and at any adjournments thereof with the same effect as if the undersigned
were
present and voting the shares. The shares represented by this proxy shall be
voted on the following matters and, in their discretion, upon any other business
which may properly come before said meeting.
1.
Election of Directors:
| o | For all nominees listed below | o | Withhold authority | |||
| (except as indicated) | to vote for all nominees listed below | |||||
To
withhold authority for any individual nominee, strike through that nominee's
name in the list below.
| Barry Hertz | Martin Kaye | Albert Drillick | Stanley Stern | ||
| Abraham Biderman | E. Bruce Fredrikson | Phillip Ort | Shaya Sofer | ||
|
|
2.
Ratification of the selection of Marcum & Kliegman LLP as independent
auditors:
oFor
oAgainst oAbstain
THE
SHARES REPRESENTED BY THIS PROXY, DULY EXECUTED, WILL BE VOTED IN ACCORDANCE
WITH THE SPECIFICATIONS MADE. IF NO SPECIFICATION IS MADE, THE SHARES
REPRESENTED BY THIS PROXY WILL BE VOTED IN FAVOR OF EACH OF THE ABOVE NOMINEES,
FOR SELECTION OF MARCUM & KLIEGMAN LLP AS INDEPENDENT AUDITORS, AND FOR SUCH
OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING AS THE PROXYHOLDERS DEEM
ADVISABLE.
Dated:________________ ,
2006
Signature(s)
of Stockholder _______________________________________________
(Title,
if appropriate)
_____________________________________________________
This
proxy should be signed by the Stockholder(s) exactly as his or her name appears
hereon. Persons signing in a fiduciary capacity should so indicate. If shares
are held by joint tenants or as community property, each owner should sign.
If a
corporation, please sign in full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name by authorized
person.
TO
ASSURE
YOUR REPRESENTATION AT THE ANNUAL MEETING, PLEASE MARK, SIGN AND DATE THIS
PROXY
AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.