<PAGE>
SCHEDULE 14A INFORMATION
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 to Section240.14a-11(c) or
Section240.14a-12
AXIOM INC.
- --------------------------------------------------------------------------------
(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):
/ / No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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:
-----------------------------------------------------------------------
<PAGE>
AXIOM INC.
351 New Albany Road
Moorestown, NJ 08057-1177
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON WEDNESDAY, MARCH 4, 1998
------------------------
The Annual Meeting of Stockholders (the "Meeting") of Axiom Inc., a Delaware
corporation (the "Company"), will be held on Wednesday, March 4, 1998, at 10:00
a.m. at the offices of Wolf, Block, Schorr and Solis-Cohen LLP, 24th Floor,
Packard Building, 111 South 15th Street, Philadelphia, Pennsylvania 19102-2678,
for the following purposes:
1. To elect five directors to hold office until the Annual Meeting of
the Stockholders in 1999 and until their respective successors are duly
elected and qualified.
2. To transact such other business as may properly come before the
Meeting and any and all adjournments and postponements thereof.
The Board of Directors has fixed the close of business on January 21, 1998
as the record date for the Meeting. Only stockholders of record at that time are
entitled to notice of and to vote at the Meeting and any adjournment or
postponement thereof.
The enclosed proxy is solicited by the Board of Directors of the Company.
Reference is made to the accompanying Proxy Statement for further information
with respect to the business to be transacted at the Meeting.
A complete list of the stockholders entitled to vote at the Meeting will be
open to the examination of any stockholder, for any purpose germane to the
Meeting, during ordinary business hours, for a period of at least 10 days prior
to the Meeting, at the offices of Wolf, Block, Schorr and Solis-Cohen LLP, 12th
Floor, Packard Building, 111 South 15th Street, Philadelphia, Pennsylvania
19102-2678.
THE BOARD OF DIRECTORS URGES YOU TO DATE, SIGN AND RETURN THE ENCLOSED PROXY
PROMPTLY. THE RETURN OF THE ENCLOSED PROXY WILL NOT AFFECT YOUR RIGHT TO VOTE IN
PERSON IF YOU DO ATTEND THE MEETING.
By Order of the Board of Directors,
Mark J. Kadish
SECRETARY
Moorestown, New Jersey
January 27, 1998
<PAGE>
AXIOM INC.
351 New Albany Road
Moorestown, NJ 08057-1177
------------------------
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
WEDNESDAY, MARCH 4, 1998
------------------------
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Axiom Inc., a Delaware corporation (the
"Company"), for use at the Company's Annual Meeting of Stockholders (together
with any and all adjournments and postponements, the "Meeting") which is
scheduled to be held at 10:00 a.m. (local Philadelphia time), on Wednesday,
March 4, 1998 at the offices of Wolf, Block, Schorr and Solis-Cohen LLP, 24th
Floor, Packard Building, 111 South 15th Street, Philadelphia, Pennsylvania
19102-2678 for the purposes set forth in the accompanying Notice of Annual
Meeting of Stockholders. This Proxy Statement, the foregoing notice and the
enclosed proxy card are being sent to stockholders on or about January 27, 1998.
The cost of solicitation of proxies will be borne by the Company. In
addition to the use of the mails, proxies may be solicited by telephone by
officers, directors and a small number of regular employees of the Company who
will not be specially compensated for such services. The Company has retained
the services of StockTrans, Inc. as the Company's proxy solicitation agent for
the Meeting, at a cost of approximately $3,000, which will be borne by the
Company. The Company also will request banks, brokers and other custodians,
nominees and fiduciaries to solicit proxies from beneficial owners, where
appropriate, and will reimburse such persons for reasonable expenses incurred in
that regard.
The Company's annual report to stockholders for the fiscal year ended
September 30, 1997, including financial statements, is being mailed to
stockholders with this Proxy Statement, but does not constitute a part of this
Proxy Statement.
<PAGE>
VOTING SECURITIES AND SECURITY OWNERSHIP
VOTING SECURITIES
At the close of business on January 21, 1998, the record date fixed for the
determination of stockholders entitled to notice of and to vote at the Meeting,
there were outstanding 6,466,900 shares of the Company's Common Stock, par value
$.01 per share ("Common Stock"), which have one vote per share.
The Company presently has no other class of stock outstanding and entitled
to vote at the Meeting. The presence at the Meeting, in person or by proxy, of
stockholders entitled to cast at least a majority of the votes which all
stockholders are entitled to cast will constitute a quorum for the Meeting. A
plurality of the votes cast is required for the election of directors.
Stockholders do not have cumulative voting rights in the election of directors.
The affirmative vote of shares entitled to cast two-thirds (2/3) of all votes
entitled to be cast at the Meeting (whether or not the holders of such shares
are represented in person or by proxy at the meeting) is required to take action
with respect to any other matter that may properly be brought before the
Meeting.
Shares cannot be voted at the Meeting unless the holder of record is present
in person or by proxy. The enclosed proxy card is a means by which a stockholder
may authorize the voting of his or her shares at the Meeting. The shares of
Common Stock represented by each properly executed proxy card will be voted at
the Meeting in accordance with the stockholder's directions. Stockholders are
urged to specify their choices by marking the appropriate boxes on the enclosed
proxy card; if no choice has been specified, the shares will be voted as
recommended by the Board of Directors. The Board of Directors knows of no
matters other than the election of directors which are likely to come before the
Meeting. However, if any other matters are properly presented to the Meeting for
action, the proxy holders will vote the proxies (which confer discretionary
authority to vote on such matters) in accordance with their judgment.
Any proxy may be revoked at any time prior to its exercise by notifying the
Secretary of the Company in writing, by delivering a duly executed proxy bearing
a later date, or by attending the Meeting and voting in person.
With regard to the election of directors, votes may be cast "FOR" or
"WITHHELD" from any or all of the nominees. Votes that are withheld will be
excluded entirely from the vote and will have no effect, other than for purposes
of determining the presence of a quorum. Brokers who hold shares in street name
for customers have the authority under the rules of the various stock exchanges
to vote on certain matters when they have not received instructions from
beneficial owners. Where brokers vote on some matters, but cannot exercise
discretionary authority on a matter for beneficial owners who have not provided
voting instructions (commonly known as "broker non-votes"), those shares will be
considered present and entitled to vote for quorum purposes, but will not be
included in the vote totals for the matter on which the broker could not vote.
Since brokers customarily have the authority to vote on behalf of the beneficial
owners in the election of directors even if they have not received instructions
from them, the Company does not expect the presence of broker non-votes to
affect the election.
YOUR VOTE IS IMPORTANT. ACCORDINGLY, YOU ARE ASKED TO COMPLETE, SIGN AND
RETURN THE ACCOMPANYING PROXY CARD WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING. IF YOU PLAN TO ATTEND THE MEETING TO VOTE IN PERSON AND YOUR SHARES ARE
REGISTERED WITH THE COMPANY'S TRANSFER AGENT IN THE NAME OF A BROKER OR BANK,
YOU MUST SECURE A PROXY CARD FROM THE BROKER OR BANK ASSIGNING VOTING RIGHTS TO
YOU FOR YOUR SHARES.
2
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
The table below sets forth certain information, as of January 21, 1998
(except as otherwise provided in note 1 below), regarding the holdings of Common
Stock of (i) each person who is known to the Company to be the beneficial owner
of more than 5% of the outstanding shares of the Company's Common Stock, (ii)
each director of the Company, (iii) each nominee for director, (iv) the
Company's Chief Executive Officer and each of the Company's four other most
highly compensated executive officers who were serving as executive officers at
the end of the fiscal year ended September 30, 1997 ("fiscal 1997") and (v) all
directors and executive officers as a group. Unless otherwise specified, the
named beneficial owner has sole voting and investment power. The information in
the table below was furnished by the persons listed, and constitutes beneficial
ownership as defined in regulations of the Securities and Exchange Commission.
Shares issuable pursuant to the exercise of stock options are included in the
table below if such options were currently exercisable or exercisable by March
22, 1998.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE
OF % OF
BENEFICIAL COMMON
NAME OF BENEFICIAL OWNER OWNERSHIP(2) STOCK
- -------------------------------------------------------------- ------------ -----------
<S> <C> <C> <C>
Securicor Communications Limited(1)........................... 3,476,900 53.8%
Michael G. Wilkinson(1)....................................... -0- --
Andrew P. Maunder............................................. 500 *
Michael S. Farina............................................. 4,000 *
Joseph F. Gorecki............................................. -0- --
Donald Hoffman................................................ -0- --
William J. Rahe, Jr. ......................................... 700 *
Robert B. Kelly............................................... -0- --
Sammy W. Pearson.............................................. 500 *
Trevor Sokell................................................. 1,700 *
All directors and executive officers as a group
(11 persons)................................................ 7,800 *
</TABLE>
- ------------------------
* Less than one percent.
(1) The address of Securicor Communications Limited ("Securicor Communications")
is Sutton Park House, 15 Carshalton Road, Sutton Surrey, United Kingdom. Mr.
Wilkinson may be deemed to own beneficially the shares owned by Securicor
Communications by virtue of his role as director of Securicor
Communications. Mr. Wilkinson disclaims beneficial ownership of these
shares. Securicor Communications is an indirect wholly-owned subsidiary of
Securicor plc, a multinational company based in the United Kingdom
("Securicor").
3
<PAGE>
ELECTION OF DIRECTORS
NOMINEES FOR ELECTION
At the Meeting, the stockholders will elect five directors to hold office
until the Annual Meeting of Stockholders in 1999 and until their respective
successors are duly elected and qualified. Unless contrary instructions are
given, the shares represented by a properly executed proxy will be voted "FOR"
the election of the following nominees: Andrew P. Maunder, Robert B. Kelly,
Sammy W. Pearson, Trevor Sokell and Michael G. Wilkinson. All of the nominees
are presently members of the Board of Directors of the Company.
The Board of Directors believes that all nominees will be able to serve as
directors; if this should not be the case, however, the proxies may be voted for
a substitute nominee designated by the Board of Directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR EACH OF THE
NOMINEES.
NOMINEES FOR ELECTION
<TABLE>
<CAPTION>
NAME AGE DIRECTOR POSITIONS WITH THE COMPANY
- --------------------------------- --- ----------- ------------------------------------------
<S> <C> <C> <C>
Andrew P. Maunder................ 41 1996 Chairman of the Board, President,
Chief Executive Officer and Treasurer
Robert B. Kelly(1)............... 41 1997 Director
Sammy W. Pearson(1)(2)........... 52 1996 Director
Trevor Sokell(1)(2).............. 56 1994 Director
Michael G. Wilkinson............. 47 1994 Director
</TABLE>
- ------------------------
(1) Member of the Compensation Committee.
(2) Member of the Audit Committee.
ANDREW P. MAUNDER has served as the Company's President and Chief Executive
Officer since October 1994 and as the Company's Treasurer since March 1995. Mr.
Maunder has been a director of the Company since October 1996 and was elected
Chairman of the Board in September 1997. From March 1994 until he joined the
Company, Mr. Maunder served as Chief Financial Officer of Oxford Molecular Group
plc, a biotechnology company based in the United Kingdom. From April 1987 until
February 1994, Mr. Maunder was Finance and Operations Director of Securicor
3Net, Ltd., ("3Net"), a communications company based in the United Kingdom that
from August 1993 until September 1997 was affiliated with Securicor. From
October 1996 to May 1997, Mr. Maunder also served as a director of Securicor
3Net, Inc., ("3Net Delaware"), which until September 1997 was a wholly-owned
indirect subsidiary of Securicor.
ROBERT B. KELLY has served as a member of the Company's Board of Directors
since July 1997. Mr. Kelly has been a principal in the Washington, D.C. law firm
of Kelly & Povich, P.C. since its formation in October 1994 and currently serves
as telecommunications counsel to Intek Diversified Corporation ("Intek"), a
wireless communications company. Mr. Kelly was a partner in the Washington D.C.
firm of Piper & Marbury from January 1989 to March 1992, was a sole practitioner
from March 1992 to February 1993 and was a principal in the firm of Kelly,
Hunter, Mow & Povich, P.C. from February 1993 to October 1994. Mr. Kelly is a
director of Intek.
SAMMY W. PEARSON has been a director of the Company since October 1996.
Since February 1994, Mr. Pearson has been the Vice President, Enterprise
Solutions of Oracle Government Services, a business unit of Oracle Corporation,
a provider of advanced software products, services and management solutions.
From May 1992 until February 1994, Mr. Pearson was Vice President of Oracle
Federal Consulting, where
4
<PAGE>
he managed Oracle's Federal government consulting business. From May 1991 to May
1992, Mr. Pearson was the principal of TechSales Limited, a software marketing
company.
TREVOR SOKELL has served as a director of the Company since July 1994. Mr.
Sokell served as the Company's President and Chief Executive Officer from July
1994 until October 1994 and served as the Company's Treasurer and Secretary from
July 1994 until March 1995. From November 1996 until May 1997, Mr. Sokell was
the Chairman of the Board of Directors of 3Net. From January 1987 until November
1996, Mr. Sokell served as Managing Director of 3Net. From November 1996 until
May 1997, Mr. Sokell was Chairman of Securicor Telecoms Ltd., an affiliate of
Securicor based in the United Kingdom.
MICHAEL G. WILKINSON has been a director of the Company since July 1994. Mr.
Wilkinson has been the Finance Director of the Communications Division of
Securicor since September 1992. From 1987 to September 1992, Mr. Wilkinson was
Finance Director of Securicor's Business Services Division. Prior to joining
Securicor in 1980, Mr. Wilkinson served as a Finance Director of RCA Limited, an
electronics company based in the United Kingdom. Mr. Wilkinson is a director of
Intek.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Company has an Audit Committee and Compensation Committee. The Audit
Committee, which consists of Messrs. Pearson and Sokell, held no meetings in
fiscal 1997. The functions of the Audit Committee generally include reviewing
with the independent auditors the scope and results of their engagement and
reviewing the adequacy of the Company's system of internal accounting controls.
The Compensation Committee, which held no meetings in fiscal 1997, consists
of Messrs. Kelly, Pearson and Sokell. The Compensation Committee is responsible
for establishing salaries, bonuses and other compensation, and granting stock
options, for the Company's executive officers.
The Board of Directors held four meetings in fiscal 1997. In fiscal 1997,
each director attended at least 75% of the combined number of meetings of the
Board and of the Committees on which such directors served. The Board of
Directors also acted by unanimous consent of the Board without a meeting on one
occasion.
COMPENSATION OF DIRECTORS
Each of the Company's directors, other than Mr. Maunder, is entitled to
receive an annual fee of $20,000 for his service on the Board of Directors. In
addition, each director is entitled to reimbursement of travel and other
expenses incurred in connection with his service as a director. Pursuant to
employment arrangements between Securicor and Mr. Wilkinson, his director's fee
is paid to Securicor. Messrs. Pearson and Sokell have each been granted options
to purchase 5,000 shares of Common Stock under the Company's 1997 Stock
Incentive Plan (the "Plan"). The law firm of which Mr. Kelly is a principal acts
as telecommunications counsel to Intek, which is an affiliate of Securicor.
5
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding compensation
paid or accrued during each of the last three years to the Company's Chief
Executive Officer and each of the Company's four other most highly compensated
executive officers (collectively, the "Named Executive Officers") at September
30, 1997:
ANNUAL COMPENSATION
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
---------------
SECURITIES ALL
FISCAL UNDERLYING OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS COMPENSATION(3)
- ------------------------------------- ----------- --------- --------- --------------- -----------------
<S> <C> <C> <C> <C> <C>
Andrew P. Maunder.................... 1997 $ 175,252 $ 6,000 53,333(1) $ 5,423
PRESIDENT, CHIEF EXECUTIVE OFFICER 1996 158,924 23,380 48,970(2) 296
1995 151,346 48,690 -0- 296
Donald Hoffman....................... 1997 $ 144,846 $ 40,760 12,000(1) $ 7,193
SENIOR VICE PRESIDENT 1996 146,339 52,338 -0- 7,547
1995 153,627 3,480 -0- 6,836
William J. Rahe, Jr. ................ 1997 $ 139,475 $ 12,282 27,560(1) $ 5,592
VICE PRESIDENT, ENGINEERING 1996 131,800 24,840 18,360(2) 5,880
1995 60,400 10,400 -0- 1,609
Joseph F. Gorecki.................... 1997 $ 112,476 $ 1,160 22,260(1) $ 4,218
VICE PRESIDENT, CUSTOMER SERVICE 1996 106,454 18,365 18,360(2) 4,346
1995 45,029 9,450 -0- 1,060
Michael C. Farina.................... 1997 $ 84,039 $ 38,205 -0- $ 2,240
VICE PRESIDENT, MARKETING AND SALES
</TABLE>
- ------------------------
(1) Consists of options to purchase the Common Stock of the Company granted in
fiscal 1997 pursuant to the Plan.
(2) Consists of options to purchase the Common Stock of Securicor, a company
traded on the London Stock Exchange. At the close of business on September
30, 1997, the price of Securicor Common Stock as reported on the London
Stock Exchange was L2.70 per share. At the noon exchange rate of U.S.
Dollars into British Pounds Sterling reported by the Federal Reserve Bank of
New York on September 30, 1997, the price of such shares in U.S. Dollars was
$4.35 per share. The exercise price of such options is L2.45 per share or
$3.95 per share at the above described exchange rate.
(3) Includes amounts paid by the Company with respect to life insurance premiums
for the benefit of the Named Executives Officers and Company contributions
to the 401(k) accounts of such officers as follows: (i) Mr. Maunder: $296
for life insurance premiums in each of fiscal 1995, 1996 and 1997,
respectively, and $5,127 in 401(k) contributions in fiscal 1997; (ii) Mr.
Hoffman: $5,798, $5,471 and $6,155 in 401(k) contributions in fiscal 1995,
1996 and 1997, respectively and $1,038 for insurance premiums in each of
fiscal 1995, 1996 and 1997, respectively; (iii) Mr. Rahe: $1,313, $5,333 and
$5,320 in 401(k) contributions in fiscal 1995, 1996 and 1997, respectively,
and $296, $296 and $362 in insurance premiums in fiscal 1995, 1996 and 1997,
respectively; (iv) Mr. Gorecki: $1,060, $4,346 and $4,218 in 401(k)
contributions in fiscal 1995, 1996 and 1997, respectively, and $153 in life
insurance premiums in fiscal 1997; and (v) Mr. Farina: $2,240 in 401(k)
contributions and $160 in life insurance premiums in fiscal 1997. Excludes
any amounts based upon Mr. Maunder's right to sell to Securicor (at a price
based on operating results in fiscal 1996 of certain Securicor businesses)
shares of 3Net previously held by him that he acquired prior to his service
with the Company.
6
<PAGE>
STOCK OPTION GRANTS IN FISCAL 1997
The following table sets forth certain information with respect to
individual grants of new stock options in fiscal 1997 to the Named Executive
Officers. The information below does not reflect the repricing of such options
that occurred in January 1998. After the repricing, the options held by the
Named Executive Officers become exercisable at a price of $5.50 per share in
July 1999 and cannot be exercised unless on the date of exercise the closing
market price of the Common Stock on Nasdaq Stock Market equals or exceeds $9.00
per share. The repricing of the options was accomplished by means of canceling
outstanding options and issuing new options on the revised terms.
OPTION GRANTS IN FISCAL 1997
INDIVIDUAL GRANTS
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
PERCENT OF VALUE AT ASSUMED
NUMBER OF TOTAL OPTIONS RATES OF STOCK PRICE
SHARES GRANTED TO APPRECIATION FOR
UNDERLYING COMPANY EXERCISE OPTION TERM
OPTIONS EMPLOYEES IN PRICE EXPIRATION --------------------
GRANTED(1) FISCAL YEAR ($/SHARE) DATE 5% 10%
------------- ----------------- ----------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Andrew P. Maunder................. 53,333 16.5% 12.00 5/29/07 $ 402,490 $1,019,989
Donald Hoffman.................... 12,000 3.7% 12.00 5/29/07 90,561 229,499
William J. Rahe, Jr. ............. 27,560 8.6% 12.00 5/29/07 207,988 527,082
Joseph F. Gorecki................. 22,260 6.9% 12.00 5/29/07 167,990 425,720
Michael C. Farina................. 27,000 8.4% 12.00 5/29/07 203,762 516,372
</TABLE>
- ------------------------------
(1) All options granted to Named Executive Officers in fiscal 1997 were options
to purchase the Common Stock of the Company pursuant to the Plan.
EMPLOYMENT AGREEMENTS
In 1994, the Company and Mr. Maunder entered into an agreement regarding Mr.
Maunder's employment with the Company, the principal terms of which were set
forth in a definitive employment agreement executed on February 10, 1995.
Pursuant to this agreement, the Company agreed to employ Mr. Maunder as Chief
Executive Officer, subject to the right of the Company to terminate the
employment relationship immediately for cause or at any time without cause upon
12 months prior written notice. Mr. Maunder has the right to terminate the
agreement upon six months prior notice to the Company. The agreement provides
that the Company pay Mr. Maunder an annual base salary ($200,000 as of September
30, 1997) which is subject to annual review. Mr. Maunder is entitled to
participate in an incentive bonus program pursuant to which cash payments are
calculated based upon performance of the Company and upon individual performance
targets and are subject to a maximum payment of 40% of his annual salary. The
agreement also entitles Mr. Maunder to standard health and other insurance
benefits and an allowance for automobile expenses. As part of his employment
agreement, Mr. Maunder is required not to disclose any proprietary information
at any time and agreed to non-competition and non-interference covenants that
expire 12 months after the termination of his employment. Mr. Maunder's
agreement also contains a covenant restricting him from soliciting the Company's
customers for a period of six months after termination of his employment.
The Company has also entered into employment agreements with Messrs.
Hoffman, Rahe, Gorecki and Farina pursuant to which the Company has agreed to
employ each of them, subject to the Company's right to terminate the employee's
employment immediately, for cause or without cause, upon specified prior written
notice (between three months and one year). The agreements also are terminable
by the employee upon specified prior notice (between three months and six
months). Each of the agreements specifies that the employee shall be paid an
annual base salary that is subject to review by the Company on an annual basis.
Annual base salary at September 30, 1997 was $125,000 for Mr. Hoffman, $144,500
for
7
<PAGE>
Mr. Rahe, $140,000 for Mr. Farina and $116,000 for Mr. Gorecki. The agreements
also entitle the employees to incentive compensation, standard health and other
insurance benefits and an allowance for automobile expenses. As part of the
agreement, each of the officers agreed to non-disclosure, non-interference and
non-competition covenants, which in the case of Messrs. Rahe, Farina and Gorecki
expire 12 months after termination of employment and in the case of Mr. Hoffman
six months after termination. Each agreement also contains a covenant
restricting the employee from soliciting the Company's customers for a period of
six months after the termination of employment.
1997 STOCK INCENTIVE PLAN
Under the Plan, a variety of awards, including stock options, stock
appreciation rights and restricted and unrestricted stock grants may be made to
the Company's employees, officers, consultants and advisors who are expected to
contribute to the Company's future growth and success. The Company has reserved
450,000 shares of Common Stock for issuance under the Plan. The Compensation
Committee administers the Plan and determines the price and other terms upon
which awards shall be made. Stock options may be granted either in the form of
incentive stock options or non-qualified stock options. The option exercise
price of incentive stock options may not be less than the fair market value of
the Common Stock on the date of the grant. While the Company currently
anticipates that most grants under this Plan will consist of stock options, the
Company may grant stock appreciation rights, which represent rights to receive
any excess in value of shares of Common Stock over the exercise price;
restricted stock awards, which entitle recipients to acquire shares of Common
Stock, subject to the right of the Company to repurchase all or a part of such
shares at their purchase price in the event that the conditions specified in the
award are not satisfied; or unrestricted stock awards, which represent grants of
shares to participants free of any restrictions under the Plan. Options or other
awards that are granted under the Plan but expire unexercised are available for
future grants. Under the terms of the Plan, the Company may not grant options to
purchase in excess of 150,000 shares of Common Stock to any one grantee during
any fiscal year.
EMPLOYEE STOCK PURCHASE PLAN
In July 1997, the Company's Board of Directors adopted an Employee Stock
Purchase Plan (the "Stock Purchase Plan") pursuant to which the Company's
employees are permitted to purchase an aggregate of up to 300,000 shares of
Common Stock at a 15% discount to its then current market price.
8
<PAGE>
AGGREGATE OPTION EXERCISES IN FISCAL 1997 AND YEAR-END OPTION VALUES
The following table sets forth a summary of options to purchase Common Stock
of the Company ("Company Options") exercised during fiscal 1997 and presents the
value of unexercised Company Options as at September 30, 1997 held by the
Company's Chief Executive Officer and each of the Company's four other most
highly compensated executive officers at such date:
AGGREGATE COMPANY OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END 1997 COMPANY OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED
SHARES OPTIONS AT FY-END VALUE OF UNEXERCISED
ACQUIRED VALUE ------------------------------ IN-THE-MONEY OPTIONS
NAME ON EXERCISE REALIZED ($) EXERCISABLE UNEXERCISABLE AT FY-END(1)
- ----------------------------- --------------- ----------------- ------------- --------------- -------------------------
<S> <C> <C> <C> <C> <C>
Andrew P. Maunder............ -0- -0- 17,778 35,555 -0-
Donald Hoffman............... -0- -0- 4,000 8,000 -0-
William J. Rahe, Jr. ........ -0- -0- 9,187 18,373 -0-
Joseph F. Gorecki............ -0- -0- 7,420 14,480 -0-
Michael C. Farina............ -0- -0- 9,000 18,000 -0-
</TABLE>
- ------------------------------
(1) The price of the Company's Common Stock as reported on the Nasdaq National
Market at September 30, 1997 was $11.75 per share. The exercise price of the
options at September 30, 1997 was $12.00 per share. The options were
repriced in January 1998.
The following table sets forth a summary of options to purchase ordinary
shares of Securicor ("Securicor Options") exercised during fiscal 1997 and
presents the value of unexercised Securicor options as at September 30, 1997
held by the Company's Chief Executive Officer and each of the Company's four
other most highly compensated executive officers at such date:
AGGREGATE SECURICOR OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END SECURICOR OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT FY-END AT FY-END (1)
ACQUIRED VALUE -------------------------------- ------------------------------
NAME ON EXERCISE REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------- --------------- ----------------- ------------- ----------------- ----------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Andrew P. Maunder........ -0- -0- 48,970 -0- $ 19,588 -0-
Donald Hoffman........... -0- -0- -0- -0- -0- -0-
William J. Rahe, Jr. .... -0- -0- 18,360 -0- $ 7,344 -0-
Joseph F. Gorecki........ -0- -0- 18,360 -0- $ 7,344 -0-
Michael C. Farina........ -0- -0- -0- -0- -0- -0-
</TABLE>
- ------------------------------
(1) All amounts reflect the conversion of British Pounds Sterling to U.S.
Dollars at the rate of 0.62 British Pounds Sterling to one U.S. Dollar, the
noon exchange rate reported by the Federal Reserve Bank of New York on
September 30, 1997.
9
<PAGE>
COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation Committee of Axiom Inc. (the "Committee") is pleased to
present its report on executive compensation. The report describes the
underlying philosophy and objectives of the Company's executive compensation
program, the various elements of the program, and the basis for the compensation
determinations made by the Committee with respect to executive officers for the
twelve-month period beginning July 1, 1997. Compensation decisions affecting the
Company's executive officers for the previous twelve-month period were
established by the Company's management in consultation with Securicor.
EXECUTIVE COMPENSATION PHILOSOPHY AND OBJECTIVES
The fundamental philosophy of the Company is to ensure that executive
compensation is linked directly to continuous improvements in corporate
performance, the achievement by officers of corporate objectives which are
linked to the Company's annual operating plan, and increases in long-term
stockholder value.
The compensation of the Company's top executives is established and reviewed
annually by the Committee, which is comprised entirely of non-employee
directors. The following guidelines have been adopted by the Committee in making
its compensation decisions:
- Providing a competitive total compensation package that enables the
Company to attract and retain key executives.
- Focusing executive behavior on fulfillment of both short and longer-term
business objectives and strategies.
- Emphasizing stockholders' interest by maintaining variable compensation
opportunities directly linked to corporate performance and stock
appreciation.
COMPENSATION PROGRAM ELEMENTS FOR FISCAL 1997
The Company's executive compensation is comprised of three components, as
described below. Each component is intended to serve the Company's compensation
philosophy and guidelines.
BASE SALARY: Base salary levels are established in July of each year
through a review of the executive's performance and experience, against industry
comparisons including telecommunications equipment companies and other
comparable firms in the Mid-Atlantic region. The Committee believes that
salaries for the Company's key executives are generally in the median range
within this comparison group. The base salaries of Messrs. Maunder, Hoffman,
Rahe, Farina and Gorecki are established pursuant to employment agreements
between these executives and the Company.
ANNUAL INCENTIVE COMPENSATION: The executive officers of the Company are
eligible to receive annual incentive payments. The Compensation Committee
generally makes these decisions in October with respect to the preceding fiscal
year. The objective of annual incentive compensation is to deliver competitive
levels of total cash compensation (base salary and incentive award) when annual
financial and operational accomplishments are made. The specific areas used to
measure key executive performance are described below:
(1) Individual performance during the year;
(2) Progress made by the Company in product development, improvements in
customer service and sales of products and services; and
(3) Achievement in reaching Company goals for profitability.
10
<PAGE>
Each of these factors is considered in evaluating the performance of the
Chief Executive Officer ("CEO") and each executive officer. These performance
evaluations are reviewed by the Committee for final determination of incentive
awards. The performance of the CEO is evaluated by the Committee and based on
the overall progress of the CEO and the Company in the specific areas described
above viewed retrospectively by the Committee. The Committee set actual
incentive awards for fiscal 1997 at a maximum of 40% of base salary for the CEO
and 20% of base salary for other executive officers, except for Messrs. Farina
and Hoffman, who are awarded bonuses based largely on the level of orders for
and sales of the Company's products and services.
STOCK OPTION PROGRAMS: The Committee strongly believes that the interests
of stockholders are best served by linking executives' financial success with
the Company's stock performance. Therefore, the Company maintains a stock option
program pursuant to which the Committee grants stock options to executives with
an exercise price equal to the fair market value on the date of grant. The
target award for each executive position is based on competitive norms for
awarding of stock options. Whether an individual receives more or less than his
target grant is based on the result of an individual performance review which
measures such individual's overall job performance.
COMPENSATION OF THE CEO AND OTHER EXECUTIVE OFFICERS
In July, the Company, in consultation with Securicor, set salary levels for
the twelve month period beginning July 1, 1997 for the Company's executive
officers. In October 1997 the Committee awarded Andrew P. Maunder, the Company's
CEO, a bonus with respect to fiscal 1997 of 3.0 % of his base salary. This award
recognized Mr. Maunder's significant role in the Company's progress in fiscal
1997, as set forth above.
The Committee reviewed the performance of the other executive officers
against the same key elements that were considered significant in the evaluation
of the CEO. Certain of the executive officers were awarded annual bonuses
ranging from 1.0% to 8.5% of base salary. Mr. Farina and Mr. Hoffman are awarded
bonuses each month based largely on the level of orders for and sales of the
Company's products and services during the previous month. Bonuses awarded to
these executive officers during fiscal 1997 were 27% and 33% of base salary,
respectively.
THE LEGISLATIVE CAP ON DEDUCTIBILITY OF PAY
The Internal Revenue Code imposes a $1 million dollar limit on the
deductibility of pay for executives. The Company's cash compensation level is
far below the limit. Therefore, this legislation will not impact current pay
levels.
The Company believes that the stock options granted to their executives are
exempt from the limitations of the regulation, because they are a form of
"qualified performance-based compensation."
The foregoing report has been furnished by the members of the Committee who
are listed below. No member of the Committee is a current officer or employee of
the Company.
THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS:
Robert B. Kelly Sammy W. Pearson Trevor Sokell
January 22, 1998
11
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
From July 1994 to March 1995, Mr. Sokell served as an executive officer of
the Company. In addition, from January 1987 until he ended his employment
relationship with Securicor in June 1997, Mr. Sokell served in senior management
positions with 3Net, first as Managing Director and then as Chairman of its
Board of Directors.
The Company purchased $405,000 of products from 3Net during fiscal 1997. In
May 1997, the Company transferred all of the stock of 3Net Delaware to 3Net for
its nominal book value. Included in the net assets transferred was an obligation
to Securicor in the amount of approximately $1.1 million. 3Net Delaware utilized
certain office space and systems of the Company for which it has been charged
approximately $7,000 per month since its formation. In connection with the
Offering, the Company entered into an agreement with 3Net Delaware pursuant to
which the Company continues to make available such space and systems in
consideration of the payment of $4,500 per month for administrative services and
$650 per month for each 3Net Delaware employee located on the Company's
premises. These amounts are based upon an estimate of the Company's cost of the
space and personnel utilized by 3Net Delaware. This agreement became effective
as of May 23, 1997, was renewed on September 30, 1997 and is terminable on
September 30, 1998, subject to annual extensions if not terminated by either
party. During fiscal 1997, the Company received payments in the amount of
$89,000 from 3Net Delaware.
3Net was an subsidiary of Securicor until September 1997, at which time
Securicor sold 3Net together with 3Net Delaware to an unaffiliated company.
Mr. Kelly serves as a director of Intek, an affiliate of Securicor for which
he also acts as telecommunications counsel.
OTHER RELATIONSHIPS AND RELATED TRANSACTIONS
Prior to the completion of the Company's initial public offering of its
Common Stock in July 1997 (the "Offering"), the Company operated as an indirect
wholly-owned subsidiary of Securicor and was a member of the Telecoms Sector of
the Communications Division of Securicor. Accordingly, Securicor assessed the
Company intercompany charges related to group and divisional costs and sales and
marketing activities. These charges were based on Securicor's estimate of its
total relevant costs for the applicable fiscal year, allocated pro rata based on
estimated revenues of each applicable business unit. The Company paid to
Securicor total charges of $444,000 in fiscal 1997. Upon completion of the
Offering, the Company was no longer liable to Securicor for any group or
divisional charges. The Company and Securicor entered into a one-year agreement
effective as of the completion of the Offering pursuant to which Securicor will
continue to provide certain international marketing services to the Company in
consideration of the payment of $160,000 per year. This payment is an estimate
of the total cost to Securicor of the personnel whose services are to be
provided, pro rated based upon the estimated portion of such personnel's total
time to be utilized by the Company.
Prior to the completion of the Offering, Securicor, from time to time,
advanced funds to the Company to meet the Company's needs for working capital
and for other corporate purposes. Such advances were treated as indebtedness of
the Company to Securicor, a portion of which bore interest at varying rates
ranging from a low of 6.25% per annum to a high of 7.75% per annum. This
interest rate was 7.50% per annum at June 30, 1997. The highest principal
balance of such amount was $23.0 million during fiscal 1997 on which the Company
incurred interest expense in the amount of $552,000 in fiscal 1997. Advances of
$5.4 million were received from Securicor in fiscal 1997.
In July 1997, the Company used proceeds of the Offering to repay $22.9
million in Company borrowings from Securicor. At September 30, 1997, the balance
of indebtedness to Securicor was $183,000.
In connection with the Offering, the Company entered into a Registration
Rights Agreement pursuant to which Securicor has the right, subject to customary
limitations, to: (i) demand registration of the resale
12
<PAGE>
of its Common Stock once during each twelve-month period at the expense of
Securicor for so long as Securicor owns at least 10% of the outstanding Common
Stock; and (ii) include its Common Stock in registration statements filed by the
Company.
STOCK PERFORMANCE GRAPH
The following graph compares the Company's cumulative total stockholder
return on its Common Stock for a twelve week period (July 8, 1997 to September
30, 1997) with the cumulative total stockholder return of a the Nasdaq Composite
Index, the Standard & Poor's 500 Index and an index of peer group companies
consisting of providers of billing data systems and related products and
services. This peer group is one with which management believes the Company to
be most aligned. The graph assumes that $100 was invested in the common stock
and each index at July 8, 1997 and that any dividends have been reinvested.
COMPARISON OF CUMULATIVE TOTAL RETURN FROM 7/8/97 TO 9/30/97
AMONG AXIOM INC., THE NASDAQ COMPOSITE INDEX AND A PEER GROUP INDEX(1)
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
7/8/97 7/31/97 8/29/97 9/30/97
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Axiom Inc...................................................................... $ 100 $ 104 $ 81 $ 98
NASDAQ......................................................................... $ 100 $ 107 $ 107 $ 114
Peer Index..................................................................... $ 100 $ 105 $ 96 $ 98
</TABLE>
- ------------------------
(1) The Peer Index includes the common stock of the following companies:
ACE*COMM Corp., CSG Systems International, Inc., ITDS, Inc., LHS Group,
Inc., Lightbridge Inc., Saville Systems plc and USCS International, Inc.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the directors and certain officers of the Company and persons who own more than
ten percent of the Company's Common Stock, to file with the Securities and
Exchange Commission initial statements of beneficial ownership and statements of
changes in beneficial ownership of Common Stock of the Company. Such directors,
officers and more than ten percent stockholders are required by regulation to
furnish the Company with copies of all Section 16(a) statements they file.
To the Company's knowledge, based solely on a review of the copies of such
statements furnished to the Company and written representations of such
directors and officers that no other statements were
13
<PAGE>
required, all fiscal 1997 Section 16(a) filing requirements applicable to its
directors, officers and more than ten percent stockholders were complied with.
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the Annual Meeting of
Stockholders in 1999 must be received by the Company at its principal office in
Moorestown, New Jersey, no later than September 25, 1998 in order to be
considered for inclusion in the Company's proxy statement and form of proxy
relating to that meeting. Stockholder proposals should be directed to Mark J.
Kadish, Secretary, at the address of the Company set forth on the first page of
this proxy statement.
ANNUAL REPORT ON FORM 10-K
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON SOLICITED BY THIS
PROXY STATEMENT, ON THE WRITTEN REQUEST OF ANY SUCH PERSON, A COPY OF THE
COMPANY'S ANNUAL REPORT ON FORM 10-K (INCLUDING THE FINANCIAL STATEMENTS AND THE
SCHEDULES THERETO BUT EXCLUDING EXHIBITS) AS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION FOR ITS MOST RECENT FISCAL YEAR. SUCH WRITTEN REQUEST SHOULD
BE DIRECTED TO MARK J. KADISH, CHIEF FINANCIAL OFFICER AND SECRETARY, AT THE
ADDRESS OF THE COMPANY APPEARING ON THE FIRST PAGE OF THIS PROXY STATEMENT.
By Order of the Board of Directors,
Mark J. Kadish
SECRETARY
14
<PAGE>
AXIOM INC.
351 NEW ALBANY ROAD
MOORESTOWN, NJ 08057-1177
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of AXIOM INC. (the "Company") hereby constitutes
and appoints ANDREW P. MAUNDER and MARK J. KADISH, and each of them acting
individually, as the attorney and proxy of the undersigned, with full power of
substitution, for and in the name and stead of the undersigned to attend the
Annual Meeting of Stockholders of the Company to be held on March 4, 1998 at
10:00 a.m. at the offices of Wolf, Block, Schorr and Solis-Cohen LLP, 24th
Floor, Packard Building, 111 South 15th Street, Philadelphia, Pennsylvania
19102-2678, and any adjournment or postponement thereof. The undersigned directs
said proxies to vote as specified below.
UNLESS OTHERWISE SPECIFIED, ALL SHARES WILL BE VOTED FOR THE ELECTION OF ALL
NOMINEES LISTED. THIS PROXY ALSO DELEGATES DISCRETIONARY AUTHORITY TO VOTE WITH
RESPECT TO ANY OTHER BUSINESS WHICH MAY PROPERLY COME BEFORE THE MEETING OR ANY
ADJOURNMENT OR POSTPONEMENT THEREOF.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY.
<TABLE>
<S> <C> <C>
ELECTION OF DIRECTORS FOR all nominees listed / / WITHHOLD AUTHORITY
(except as indicated to the to vote for all
contrary below) nominees / /
</TABLE>
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH
THE NOMINEE'S NAME LISTED BELOW:
<TABLE>
<S> <C> <C>
Andrew P. Maunder Robert B. Kelly Sammy W. Pearson
Trevor Sokell Michael G. Wilkinson
</TABLE>
CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE
<PAGE>
THE UNDERSIGNED HEREBY REVOKES ALL PREVIOUS PROXIES FOR THE MEETING AND
ACKNOWLEDGES RECEIPT OF THE NOTICE OF ANNUAL MEETING, PROXY STATEMENT AND ANNUAL
REPORT OF AXIOM INC.
Dated: _____________________, 1998
(Complete Date)
____________________________(SEAL)
(Stockholder's Signature)
____________________________(SEAL)
(Stockholder's Signature)
____________________________Shares
NOTE: Please sign as name appears
on the address label. If shares
are registered in more than one
name, all owners should sign. If
signing in a fiduciary or
representative capacity, please
give full title and attach
evidence of authority.
Corporations please sign with full
corporate name by a duly
authorized officer and affix
corporate seal.
