<PAGE> 1
SCHEDULE 14A
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 SECTION 240.14a-11(c) OR
SECTION 240.14a-12
ORBIT/FR, 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):
/X/ NO FEE REQUIRED.
/ / FEE COMPUTED ON TABLE BELOW PER EXCHANGE ACT RULES 14A-6(i)(4) AND 0-11.
<PAGE> 2
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> 3
ORBIT/FR, INC.
506 Prudential Road
Horsham, Pennsylvania 19044
DEAR STOCKHOLDER:
You are cordially invited to attend the annual meeting of stockholders
("Annual Meeting") of Orbit/FR, Inc. (the "Company") to be held on Friday, May
19, 2000 at 10:00 a.m., local time, at the Corporation Trust Center, 1209 Orange
Street, Wilmington, Delaware 19801.
The proposals for the Annual Meeting relate to (i) the election of four
(4) directors and (ii) the ratification of the Board of Directors' appointment
of Ernst & Young LLP, independent auditors for the Company for the fiscal year
ending December 31, 2000. Our Annual Report on Form 10-K for the fiscal year
ended December 31, 1999 accompanies this Proxy Statement.
We look forward to seeing you at the Annual Meeting. Whether or not you
are planning to attend, we urge you to return the enclosed proxy at your
earliest convenience.
Sincerely,
/s/ Zeev Stein
---------------------------------------------
Zeev Stein
Chairman of the Board of Directors
April 28, 2000
<PAGE> 4
ORBIT/FR, INC.
506 PRUDENTIAL ROAD
HORSHAM, PENNSYLVANIA 19044
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 19, 2000
To the Stockholders of
Orbit/FR, Inc.:
The Annual Meeting of Stockholders (the "Annual Meeting") of Orbit/FR,
Inc. (the "Company") will be held at the Corporation Trust Center, 1209 Orange
Street, Wilmington, Delaware 19801 on Friday, May 19, 2000 at 10:00 a.m., local
time, for the following purposes:
1. To elect four (4) directors for the ensuing year;
2. To ratify the selection of Ernst & Young LLP as the Company's
independent auditors for the year ending December 31, 2000;
and
3. To transact any other business as may properly be brought
before the Annual Meeting.
Any action may be taken on the foregoing matters at the Annual Meeting
on the date specified above, or on any date or dates to which the Annual Meeting
may be adjourned.
The Board of Directors has fixed the close of business on March 31,
2000 as the record date for determining the stockholders entitled to notice of,
and to vote at, the Annual Meeting and at any adjournments or postponements
thereof. Only stockholders of record of the Company's Common Stock (the "Common
Stock") at the close of business on that date will be entitled to notice of, and
to vote at, the Annual Meeting and at any adjournments or postponements thereof.
Your attention is directed to the accompanying Proxy Statement for the
text of the resolutions to be proposed at the Annual Meeting and further
information regarding each proposal to be made. A copy of the Company's Annual
Report on Form 10-K for the year ended December 31, 1999 is enclosed herewith.
All stockholders are cordially invited to attend the Annual Meeting.
Whether or not you plan to attend the Annual Meeting, all holders of shares of
the Company's Common Stock are urged to complete and sign the enclosed proxy,
and return it promptly to the Company. At any time prior to their being voted,
proxies are revocable by delivering written notice to the Company in accordance
with the instructions set forth in the Proxy Statement or by voting at the
Annual Meeting in person.
STOCKHOLDERS UNABLE TO ATTEND THE ANNUAL MEETING IN PERSON ARE ASKED TO VOTE,
SIGN, DATE AND RETURN PROMPTLY THE ENCLOSED PROXY IN THE ENCLOSED SELF-ADDRESSED
ENVELOPE, WHICH DOES NOT REQUIRE ANY POSTAGE IF MAILED IN THE UNITED STATES.
By order of the Board of Directors
/s/ Irene Honeycutt
------------------------------------------
Irene Honeycutt
Secretary
April 28, 2000
Horsham, Pennsylvania
<PAGE> 5
ORBIT/FR, INC.
506 PRUDENTIAL ROAD
HORSHAM, PENNSYLVANIA 19044
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 19, 2000
PROXY STATEMENT
This Proxy Statement (the "Proxy Statement") has been prepared and is
being distributed in connection with the solicitation by the Board of Directors
of Orbit/FR, Inc. (the "Company") of proxies (each a "Proxy" and collectively,
the "Proxies") in the enclosed form for use at the Annual Meeting of
Stockholders of the Company (the "Annual Meeting") to be held on Friday, May 19,
2000, at 10:00 a.m., local time, at the Corporation Trust Center, 1209 Orange
Street, Wilmington, Delaware 19801 and any adjournment(s) or postponement(s)
thereof.
VOTING AND REVOCABILITY OF PROXIES
Stockholders of record as of the close of business on March 31, 2000
(the "Record Date") will be entitled to vote at the Annual Meeting and any
adjournment thereof. As of the Record Date, 6,074,473 shares of common stock,
par value $.01 per share of the Company (the "Common Stock") were outstanding
and entitled to one vote each. Execution of a Proxy will not in any way affect a
stockholder's right to attend the Annual Meeting and vote in person. Any
stockholder submitting a Proxy has the right to revoke it at any time before it
is exercised by another instrument or transmission revoking it or by filing a
properly created proxy bearing a later date with the Secretary of the Company.
Shares represented by properly executed Proxies for which no
instructions are received will be voted for all the nominees identified below
under "Proposal No. 1-Election of Directors," and for the ratification of
accountants identified below under "Proposal No. 2-Appointment of Accountants."
The persons named as proxies are either officers or directors of the Company.
The presence, in person or by Proxy, of stockholders entitled to cast
at least a majority of the votes that all stockholders are entitled to cast on a
particular matter to be acted upon at the Annual Meeting, shall constitute a
quorum for the purposes of consideration and action on such matter. Abstentions
and broker non-votes are each included in the number of shares present at the
Annual Meeting for purposes of establishing a quorum. The affirmative vote of a
plurality of the votes cast is required for the election of directors. For all
other proposals, the affirmative vote of the holders of a majority of shares of
Common Stock present, in person or by Proxy, at the Annual Meeting is required.
If any other matter should be presented at the Annual Meeting upon which it is
proper to take a vote, shares represented by all Proxies received will be voted
with respect thereto in accordance with the judgment of the persons named as
proxies.
This Proxy Statement and the accompanying materials were first sent to
the stockholders on or about May 1, 2000.
ADDITIONAL INFORMATION
The Company will furnish without charge to any stockholder, upon
written or oral request, a copy of the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1999, including any amendments thereto, and
other documents filed pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934. Requests for such documents should be addressed
to William A. Torzolini, Vice President, Finance and Chief Financial Officer,
Orbit/FR, Inc., 506 Prudential Road, Horsham, Pennsylvania 19044, telephone
number (215) 674-5100.
<PAGE> 6
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of April 28, 2000 certain
information with regard to beneficial ownership (as determined in accordance
with Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as
amended) of outstanding shares of the Company's Common Stock by (i) each person
known by the Company to beneficially own five percent (5%) or more of the
outstanding shares of the Company's Common Stock, (ii) each director and Named
Executive Officer (as defined below) individually, and (iii) all executive
officers and directors of the Company as a group:
<TABLE>
<CAPTION>
TOTAL NUMBER OF SHARES PERCENTAGE OF CLASS OF
NAME AND ADDRESS OF OF COMMON STOCK COMMON STOCK
BENEFICIAL OWNER BENEFICIALLY OWNED(1) BENEFICIALLY OWNED(1)
- ---------------- ---------------------- ----------------------
<S> <C> <C>
Orbit-Alchut Technologies, Ltd. (2) 3,700,000 60.9%
P.O. Box 3171
Industrial Zone
Netanya 42131 Israel
Zeev Stein (3) 3,706,000 61.9%
P.O. Box 3171
Industrial Zone
Netanya 42131
Israel
Shimon Alon (4) 12,000 *
c/o Orbit/FR, Inc.
506 Prudential Road
Horsham, PA 19044
Uri Jenach (5) -- *
c/o Orbit/FR, Inc.
506 Prudential Road
Horsham, PA 19044
William A. Torzolini (6) 12,000 *
Orbit/FR, Inc.
506 Prudential Road
Horsham, Pennsylvania 19044
Michael J. Hart, Sr. (7) 6,250 *
Orbit/FR, Inc.
506 Prudential Road
Horsham, Pennsylvania 19044
Thomas J. Burke (8) -- *
Orbit/FR, Inc.
506 Prudential Road
Horsham, Pennsylvania 19044
John Aubin (9) 10,000 *
Orbit/FR, Inc.
506 Prudential Road
Horsham, Pennsylvania 19044
</TABLE>
2
<PAGE> 7
<TABLE>
<S> <C> <C>
All executive officers and directors 3,755,750 61.8%
as a group (11 persons) (10)
</TABLE>
* Less than 1% of the outstanding Common Stock.
(1) The securities "beneficially owned" by an individual are determined in
accordance with the definition of "beneficial ownership" set forth in
the regulations of the Securities and Exchange Commission (the "SEC").
Accordingly, they may include securities owned by or for, among others,
the spouse and/or minor children of the individual and any other
relative who has the same home as such individual, as well as other
securities as to which the individual has or shares voting or
investment power or has the right to acquire under outstanding stock
options within 60 days after the date of this Proxy Statement.
Beneficial ownership may be disclaimed as to certain of the securities.
(2) Represents shares beneficially owned after the Company's initial public
offering effective June 17, 1997.
(3) Represents 3,700,000 shares held by Alchut. Mr. Stein is a director and
57% beneficial stockholder of Alchut. Also includes 6,000 shares of
Common Stock issuable upon the exercise of options granted to Mr.
Stein, which options became exercisable on December 16, 1999. Does not
include 24,000 shares of Common Stock issuable upon the exercise of
options granted to Mr. Stein, which options become exercisable in five
cumulative annual installments commencing 12 months after the date of
original grant, which options are not exercisable within 60 days of the
date of this Proxy Statement.
(4) Represents 12,000 shares of Common Stock issuable upon the exercise of
options granted to Mr. Alon, which options became exercisable on July
2, 1998 and 1999. Does not include 18,000 shares of Common Stock
issuable upon the exercise of options granted to Mr. Alon upon his
appointment to the Board of Directors, which options become exercisable
in five cumulative annual installments commencing 12 months after the
date of original grant, which options are not exercisable within 60
days of the date of this Proxy Statement.
(5) Does not include 30,000 shares of Common Stock issuable upon the
exercise of options granted to Mr. Jenach on December 16, 1998, which
options become exercisable in four cumulative annual installments
commencing 24 months after the date of grant.
(6) Includes 10,000 shares of Common Stock issuable upon the exercise of
options granted to Mr. Torzolini which become exercisable May 14, 2000.
Does not include 30,000 shares of Common Stock issuable upon the
exercise of options granted to Mr. Torzolini, which options become
exercisable in four cumulative annual installments commencing 24 months
after the date of original grant.
(7) Includes 6,250 shares of Common Stock issuable upon the exercise of
options granted to Mr. Hart which become exercisable May 2, 2000. Does
not include 18,750 shares of Common Stock issuable upon the exercise of
options granted to Mr. Hart which options become exercisable in four
cumulative annual installments commencing 24 months after the date of
original grant.
(8) Does not include 25,000 shares of Common Stock issuable upon the
exercise of options granted to Mr. Burke on December 16, 1998, which
options become exercisable in four cumulative annual installments
commencing 24 months after the date of original grant.
(9) Represents 10,000 shares of Common Stock issuable upon the exercise of
options granted to Mr. Aubin, which options are exercisable on June 17,
2000. Does not include 10,000 shares of Common Stock issuable upon the
exercise of options granted to Mr. Aubin, which options become
exercisable in four cumulative annual installments commencing 24 months
after the date of original grant, which options are not exercisable
within 60 days of the date of this Proxy Statement.
(10) Includes the information contained in the notes above, as applicable.
Includes 3,500 shares of Common Stock issuable upon the exercise of
options granted to certain other executive officers, which options are
exercisable on June 17, 2000. Does not include 50,750 shares of Common
Stock issuable upon the exercise of options granted to certain other
executive officers on June 17, 1997, which options become exercisable
in four cumulative annual installments commencing 24 months after the
date of original grant. Does not include 3,000 shares of Common Stock
issuable upon the exercise of options granted to certain other
executive officers on December 16, 1998, which options become
exercisable in four cumulative annual
3
<PAGE> 8
installments commencing 24 months after the date of original grant.
Does not include 29,000 shares of Common Stock issuable upon the
exercise of options granted to certain other executive officers on
March 24, 1999, which options become exercisable in four cumulative
annual installments commencing 24 months after the date of original
grant. Does not include 35,000 shares of Common Stock issuable upon the
exercise of options granted to certain other executive officers on
December 16, 1999, which options become exercisable in four cumulative
annual installments commencing 24 months after the date of original
grant.
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
Four (4) directors are to be elected at the Annual Meeting, each to serve
until the next annual meeting and until his successor shall have been elected
and qualified. Each of the nominees named below is presently a member of the
Board of Directors. In case any of the nominees should become unavailable for
election, for any reason not presently known or contemplated, the persons named
on the Proxy card will have discretionary authority to vote pursuant to the
Proxy for a substitute.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL NO. 1.
The following table sets forth the name, age and principal occupation of
each director, including the nominees.
<TABLE>
<CAPTION>
NAME AGE SINCE PRINCIPAL OCCUPATION
- ---- --- ----- --------------------
<S> <C> <C> <C>
Zeev Stein 47 1996 Chairman of the Board of Directors and Acting Chief
Executive Officer of the Company.
Shimon Alon 48 1997 Chief Executive Officer of Precise Software Ltd.
Uri Jenach 48 1999 General Manager of SophistiPak Ltd., Netanya, Israel.
Reuven Fatal 51 2000 President and Chief Executive Officer, Alchut.
</TABLE>
ZEEV STEIN has served as a director of the Company and its predecessor
since March 1996 and began serving as Chairman of the Board of Directors in
October 1998. Since July 1994, Mr. Stein has served as a Director of Alchut and
since September 1996, Mr. Stein has also served as the Vice-President of
Operations of Alchut. From 1991 to 1996, Mr. Stein was the General Manager of
Stein Special Art, Ltd., located in Ra'anana, Israel.
SHIMON ALON was named a director in June 1997, and has served as President
and Chief Executive Officer of Precise Software Ltd., a private company in
Braintree, Massachusetts since October 1997, which provides tools that link the
production support and application development processes. From 1982 to 1997, Mr.
Alon served with Scitex Corporation Ltd. in Herzlia, Israel in various
capacities, with his last position as President of Scitex America Corp. in
Bedford, Massachusetts which sells and supports products used in graphic arts
and digital printing.
URI JENACH was named a director in November 1999, and has served as the
General Manager of SophistiPak Ltd, an Engineering and Packaging Consulting
company since 1993. Mr. Jenach has served as a Director of Orbit FR,
Engineering, Ltd., a subsidiary of the Company since 1996. Mr. Jenach also
serves as a Director of Orbit Avionics, Ltd.
REUVEN FATAL has served as President and Chief Executive Officer of Alchut
since 1997. From 1994 to 1997, Mr. Fattal served as General Manager of Comverse,
Inc.'s Efrat's audio-disk division. Prior to 1994 Mr. Fattal served in various
roles with the Israeli Defense Forces.
The Board of Directors met three times during the last fiscal year. There
was no incumbent who, during the last full fiscal year, attended in person or by
phone fewer than 75% of the meetings of the Board of Directors.
BOARD OF DIRECTORS
The Company's Amended and Restated Certificate of Incorporation provides
that the Board of Directors shall consist of not less than three nor more than
thirteen members, the exact number to be fixed and determined from time to time
by the Board. The Company's Board of Directors is presently composed of four (4)
directors.
4
<PAGE> 9
COMMITTEES OF THE BOARD
The Board of Directors established its Compensation Committee and Audit
Committee in December 1998.
The Compensation Committee of the Board of Directors, subject to the
approval of the Board of Directors, determines the compensation of the Company's
executive officers and oversees the administration of executive compensation
programs. During 1999, the Compensation Committee met twice and was composed of
Mr. Alon, Uri Jenach, and Mr. Stein. Mr. Alon and Mr. Jenach were independent,
nonemployee directors. There was no member of the Compensation Committee who,
during the last fiscal year attended in person or by phone fewer than 75% of the
meetings of the Compensation Committee.
The Audit Committee recommends outside accountants, reviews the results
and scope of the annual audit, the services provided by the Company's
independent auditors and the recommendations of the auditors with respect to the
Company's accounting systems and controls. During 1999, the Audit Committee met
once and was composed of Mr. Alon, Mr. Stein and Mr. Jenach. Mr. Alon and Mr.
Jenach were independent, nonemployee directors. Representatives of the Company's
independent auditing firm, Ernst & Young LLP, met with the Audit Committee
during the first quarter of 2000 and reviewed their examination of the Company's
financial statements for the year ended December 31, 1999. There was no member
of the Audit Committee who, during the last fiscal year, attended in person or
by phone, fewer than 75% of the meetings of the Audit Committee.
COMPENSATION OF DIRECTORS
On December 16, 1998, Mr. Jenach was granted an option to purchase
30,000 shares of common stock at an exercise price of $3 per share. These
options will vest in five cumulative annual increments commencing 12 months
after the date of grant. Mr. Jenach and Mr. Alon received consulting fees
totaling $5,000 for serving on the Company's Board of Directors. Mr. Jenach,
under a separate agreement also received consulting fees of $12,000 during the
year.
COMPENSATION PHILOSOPHY AND POLICY
Our compensation program generally is designed to motivate and reward
our executive officers and other personnel responsible for attaining financial
objectives that will contribute to the overall goal of enhancing stockholder
value. In administering the program, the compensation committee assesses the
performance of our business and our employees relative to those objectives. Our
compensation program generally provides incentives to achieve annual and longer
term objectives. The principal elements of the compensation plan include base
salary, cash bonus awards and stock awards in the form of grants of stock
options. These elements generally are blended in order to provide compensation
packages which provide competitive pay, reward the achievement of financial
objectives and align the interests of our executive officers and other high
level personnel with those of our stockholders.
BASE SALARY. In setting base salaries for officers and employees, we
consider the experience of the individual, the scope and complexity of the
position, our size and growth rate, profitability, and the compensation paid by
our competitors.
BONUSES. Our executive officers were not eligible to receive bonuses in
1999 due to actual losses incurred by the Company. The only bonus paid during
1999 related to sales objectives established for Mr. Burke. Mr. Burke's bonus
was based upon quarterly sales targets. A revised incentive plan for all
executives was established by the Compensation committee of the Board of
Directors for the year 2000. It is meant to incent executives for attaining
predetermined profit levels for both individual business units and for the
Company overall. The plan is calculated annually after year end results are
audited and executives must be employed by the Company on December 31st.
STOCK AWARDS. To promote our long-term objectives, stock awards are
made to directors, officers and employees who are in a position to make a
significant contribution to our long-term success. The stock awards are made to
directors, employees and consultants pursuant to our 1997 Stock Option Plan, in
the form of qualified and nonqualified stock options.
The compensation committee has discretion to determine which employees
and consultants will be granted stock options, the number of shares to be
optioned and the terms and conditions of such options. The full board of
directors conducts the administration of the option plan with respect to options
granted to directors or to officers subject to section 16 of the Exchange Act.
The compensation committee, or the board of directors, as applicable, also has
discretion to make adjustments to options in the event of a change in control or
other corporate event including, without limitation, the discretion to
accelerate the vesting of options or waive our repurchase right. Options
currently outstanding generally vest over a five year period.
5
<PAGE> 10
In selecting recipients and the size of grants, the compensation
committee considers various factors such as the potential of the recipient, the
salary of the recipient and competitive factors affecting our ability to attract
and retain employees, prior grants, a comparison of awards made to officers in
comparable positions at similar companies and the performance of our business.
During 1999, Mr. Bernstein was granted options to purchase 40,000
shares of our common stock. During 1999, Mr. Polan was granted options to
purchase 20,000 shares of our common stock. No other option awards were made to
other executive officers during 1999.
Respectfully submitted,
Zeev Stein, Chairman
Shimon Alon
Uri Jenach
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1999, we had a Compensation Committee comprised of all board
members as previously described under "Committees of the Board." Although Mr.
Alon and Mr. Jenach were independent, non employee directors, Mr. Stein was an
officer and employee during the year serving in the capacity of Chairman of the
Board of Directors and acting Chief Executive Officer of the Company. Mr.
Stein's compensation and stock ownership are described in detail in sections
"Security Ownership of Certain Beneficial Owners and Management" and "Summary
Compensation Table."
6
<PAGE> 11
STOCK PERFORMANCE GRAPH
The graph below provides an indicator of ORBIT FR, Inc.'s cumulative
stockholder return as compared to Nasdaq Composite Index. There are no publicly
traded companies included in ORBIT FR, Inc.'s list of direct competitors and we
have therefore not included peer group data.
The graph assumes an initial investment of $100 and reinvestment of
dividends. The graph covers a period of time beginning with the Company's
initial public offering in June 1997, through December 31, 1999.
[LINE GRAPH]
<TABLE>
<CAPTION>
Quarter ORFR Inc. Nasdaq
Ended Index Index
- ------- --------- -----
<S> <C> <C>
Jun 97 100.00 100.00
Sep 97 234.62 116.89
Dec 97 165.38 108.90
Mar 98 107.69 127.29
Jun 98 69.23 131.39
Sep 98 23.08 117.46
Dec 98 25.64 152.05
Mar 99 17.63 170.69
Jun 99 24.36 186.27
Sep 99 22.44 190.43
Dec 99 28.21 282.19
</TABLE>
7
<PAGE> 12
EXECUTIVE OFFICERS AND KEY EMPLOYEES OF THE COMPANY
The following table sets forth certain information regarding the
Company's executive officers, and certain key employees, who are not directors.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Ze'ev Stein 47 Chairman, Acting Chief Executive Officer
William A. Torzolini 39 VP Finance, Chief Financial Officer
Michael J. Hart, Sr. 47 VP EMC Division
Thomas J. Burke 39 Former VP Sales and Customer Support
John Aubin 46 VP Measurement Systems
Moshe Pinkasy 49 Chief Operating Officer, Engineering,
Marcel Boumans 42 Managing Director, Orbit FR Europe, GmbH
Gabriel Sanchez 48 President, AEMI
Jeff Polan 48 VP Research and Development, Chief Technology Officer
David S. Bernstein 53 Executive Vice President, Chief Operating Officer
Mark A. Bates 30 VP Software Development U.S.A.
</TABLE>
Zeev Stein has served as Chairman of the Board and acting Chief
Executive Officer of the Company since October 1998. He has also served as a
Director of the Company and its predecessor since March 1996. Since July 1994,
Mr. Stein has served as a Director of Alchut and since September 1996, Mr. Stein
has also served as the Vice-President of Operations of Alchut. From 1991 to
1996, Mr. Stein was the General Manager of Stein Special Art, Ltd., located in
Ra'anana, Israel.
William A. Torzolini has served as Vice President of Finance and Chief
Financial Officer for the Company since May of 1998. From 1990 to 1998 Mr.
Torzolini was employed at Novacare, Inc., a national provider of rehabilitation
healthcare services in various senior management roles including Vice President
of Finance and Chief Financial Officer of Novacare's Outpatient Division.
Michael J. Hart, Sr. has served as the Vice President of the EMC
Division since joining the Company in May 1998. Mr. Hart was the President of
Quantum Change/EMC Systems, Inc., a privately held company specializing in
software for the electromagnetic compatibility (EMC) marketplace. The
significant assets of Quantum Change/EMC Systems, Inc. were purchased by the
Company in May 1998. From January 1980 through November 1994, Mr. Hart was the
President of Electro-Mechanics Company, a privately held manufacturer of EMC
components.
Thomas J. Burke served as Vice President of Sales and Customer Support
for the Company since September 1998. Effective January 1, 2000 Mr. Burke was
responsible for sales and customer support for the U.S. market. Mr. Burke left
the Company on April 3, 2000. From 1996 through 1998, Mr. Burke was employed as
the Director - Worldwide Sales and Customer Service for Robotic Vision Systems
Inc. From 1993 through 1996, Mr. Burke served in various capacities at Kulicke &
Soffa Industries, Inc.
John Aubin has served as Vice President of Measurement Systems since
June 1996. From 1991 to 1996, Mr. Aubin was Vice President in charge of the
Antenna Measurement Business Area for Flam & Russell.
Moshe Pinkasy has served as the Chief Executive Officer of Engineering
since January 1997. From February 1996 to December 1996, Mr. Pinkasy was
Alchut's Manager of the Microwave Test and Measurement Business in Israel. From
1992 to 1996, Mr. Pinkasy served, in various capacities, as the Mechanical
Engineering Department Manager for Alchut.
Marcel Boumans has served as the Managing Director of Orbit FR Europe,
GmbH since March 1997. Effective January 1, 2000 Mr. Pinkasy is responsible for
sales and customer support for Europe. From June 1995 to March 1997, Mr. Boumans
was a Systems Design Engineer for Dornier Satelliten Systeme GmbH, the satellite
systems subsidiary of Daimler-Benz Aerospace. From 1990 to 1995, Mr. Boumans was
a Systems Design Engineer for Dornier GmbH, the communications and defense
subsidiary of Daimler-Benz Aerospace.
8
<PAGE> 13
Gabriel Sanchez has served as President of AEMI since its establishment
in March of 1980. Prior to that period, Mr. Sanchez worked for Plessy Microwave
and Emerson and Cumming.
Jeffery S. Polan has served as the Company's Vice President, Research
and Development, and Chief Technology Officer since March 1999. During 1998 Mr.
Polan served as Vice President of Engineering at Aydin Telemetry. From 1996 to
1998 Mr. Polan served as Vice President Engineering at InterDigital
Communications Corporation. From 1989 to 1996 Mr. Polan was President of Program
Digital Systems Inc.
David S. Bernstein has served with the Company since March 1999. From
1997 to 1998 Mr. Bernstein served as Vice President of Operations at Aydin
Telemetry. From 1995 to 1997 Mr. Bernstein served as VP Operations at Solid
State Devices, Inc. From 1991 to 1995 Mr. Bernstein served as Vice President and
General Manager of Microtran.
Mark A. Bates was named the Company's Vice President of Software
Development, U.S.A. in January 2000, and has served in several software
development capacities since joining the company in 1995.
EXECUTIVE COMPENSATION
The following Summary Compensation Table summarizes the compensation of
the Chief Executive Officer and the other Named Executive Officers of the
Company for 1999 (the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long Term
Compensation
Awards All other
Name and Principal Underlying Compen-
Position Year Salary Bonus Options(#) sation(1)
- -------- ---- ------ ----- ------------ ---------
<S> <C> <C> <C> <C> <C>
Ze'ev Stein 1999 $180,000 -- -- --
Acting Chief 1998 30,000 --
Executive Officer
William A. Torzolini 1999 184,694 -- -- $456
Vice President, 1998 104,630 -- 40,000 410
Finance, Chief
Financial Officer
Michael J. Hart, Sr. 1999 120,840 -- -- 456
Vice President, 1998 103,458 -- 25,000 --
EMC Division
Thomas J. Burke 1999 120,008 25,832 -- 456
Former Vice President, 1998 39,802 -- 25,000 508
Sales and Customer Support
John Aubin 1999 100,006 -- -- 456
Vice President, 1998 115,352 3,350 -- 508
Measurement 1997 91,998 18,802 20,000 456
Systems
</TABLE>
(1) Represents life insurance premiums paid.
9
<PAGE> 14
STOCK OPTION GRANTS
No stock options were granted to the Named Executive Officers of the
Company during the year ended December 31, 1999.
AGGREGATED FISCAL YEAR-END OPTION VALUES
The table below shows 1999 year-end amounts and value of shares of Common
Stock underlying outstanding options. The Named Executive Officers did not
exercise any stock options in 1999.
<TABLE>
<CAPTION>
Number of Securities Underlying Value of Unexercised In-the-Money
Unexercised Options at Options at
December 31, 1999 December 31, 1999(1)
----------------- --------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Ze'ev Stein 6,000 24,000 -- --
William A. Torzolini - 40,000 -- --
Michael J. Hart, Sr. - 25,000 -- --
Thomas J. Burke - 25,000 -- --
John Aubin 10,000 10,000 -- --
</TABLE>
(1) Based on the closing price of $2 5/8 on the Nasdaq National Market on
December 31, 1999.
EMPLOYMENT AGREEMENTS
Michael Hart. Effective May 2, 1998, the Company entered into an
employment agreement with Michael Hart, the Executive Vice President of the
Company's EMC Division, for an initial term of one year and thereafter
terminable by either the Company or Mr. Hart on 360 days notice within the first
year, 180 days in the second year and 90 days thereafter. Pursuant to the terms
of Mr. Hart's employment agreement, Mr. Hart is entitled to receive an annual
base salary of $120,000 or such higher amount as the Company's Board of
Directors may determine from time to time.
Mr. Hart's employment agreement may be terminated by the Company for
cause, which is defined as the material breach of the employment agreement by
Mr. Hart or if Mr. Hart commits a material act of dishonesty or a material
breach of trust or a fiduciary obligation with respect to the Company. The
employment agreement may be terminated by Mr. Hart immediately upon notice for
cause which is defined as a reduction in salary or a material breach of the
agreement which employer has failed to cure after ten days written notice
thereof. Under the employment agreement, Mr. Hart is subject to certain
non-disclosure, non-solicitation and non-competitive covenants.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
TRANSACTIONS BETWEEN ALCHUT AND ENGINEERING
Orbit/FR Engineering, Ltd. ("Engineering"), the Company's wholly-owned
Israeli subsidiary, and Alchut have an agreement, whereby Engineering purchases
from Alchut electrical and mechanical production services. Engineering pays
Alchut for these services based upon a rate of cost plus 5%, totaling
approximately $1,104,000 for the year ended December 31, 1999. In addition,
Alchut provided other administrative services to Engineering, including but not
limited to, bookkeeping, computer, legal, accounting, cost management,
information systems, and production support, which amounted to $240,000 in 1999.
These agreements are evaluated on an annual basis.
10
<PAGE> 15
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors and persons who own more than ten percent (10%)
of the Company's Common Stock to file initial reports of ownership and reports
of change of ownership with the SEC. Executive officers and directors are
required by SEC regulations to furnish the Company with copies of all Section
16(a) forms they file. Based solely on a review of the copies of such forms
furnished to it, the Company believes that, during the preceding year, the
executive officers and directors and persons who own more than ten percent (10%)
of the Company's Common Stock then subject to Section 16(a) complied with all
Section 16(a) filing requirements.
PROPOSAL NO. 2 - APPOINTMENT OF ACCOUNTANTS
Subject to stockholder ratification, the Board of Directors intends to
appoint the firm of Ernst & Young LLP which served as the Company's independent
auditors for the last fiscal year, as its independent auditors for the year
ending December 31, 2000.
One or more representatives of Ernst & Young LLP are expected to be present
at the Annual Meeting, who will have the opportunity to make a statement if so
desired and will be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL NO. 2
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
The Company intends to mail next year's proxy statement to its stockholders
on or about May 1, 2001. Any stockholder proposal intended to be presented at
the Company's 2001 annual meeting of stockholders pursuant to Rule 14a-8
promulgated under the Securities Exchange Act of 1934 (the "Exchange Act") must
be received by the Company at its office in Horsham, Pennsylvania on or before
January 1, 2001 in order to be considered for inclusion in the Company's proxy
statement and form of proxy relating to such annual meeting.
With respect to the Company's 2001 annual meeting of stockholders, if the
Company is not provided notice of a stockholder proposal, which the stockholder
has not previously sought to include in the Company's proxy statement under Rule
14a-8, by March 17, 2000, the management proxies will be allowed to use their
discretionary authority when the proposal is raised at the meeting, without any
discussion of the matter in the proxy statement.
OTHER MATTERS
The Board of Directors does not intend to bring any matters before the
Annual Meeting, other than as stated in this Proxy Statement, and is not aware
that any other matters will be presented for action at the Annual Meeting. If
any other matters come before the Annual Meeting, the persons named in the
enclosed Proxy will vote the Proxy with respect thereto, in accordance with
their best judgment, pursuant to the discretionary authority granted by the
Proxy.
EXPENSES OF SOLICITATION
The cost of preparing, assembling, mailing and soliciting the Proxies will
be borne by the Company. In addition to the use of the mails, Proxies may be
solicited by regular employees of the Company, either personally or by
telephone. The Company does not expect to pay any compensation for the
solicitation of Proxies, but may reimburse brokers and other persons holding
shares in their names or in the names of nominees for expenses in sending proxy
materials to beneficial owners and obtaining Proxies from such owners.
All properly executed Proxies delivered pursuant to this solicitation and
not revoked will be voted at the Annual Meeting in accordance with the
directions given. In voting by Proxy in regard to the election of directors to
serve until the next annual meeting of stockholders, stockholders may vote in
favor of all nominees or withhold votes as to all nominees or withhold votes as
to specific nominees. With respect to other items to be voted upon, stockholders
may vote in favor of the item or against the item or may abstain from voting.
Stockholders should specify their choices on the enclosed Proxy. If no specific
instructions are given with respect to the matters to be acted upon, and the
Proxy is returned properly executed, then the shares represented by the Proxy
will be voted FOR the election of all directors, and FOR the proposal to ratify
the appointment of the independent accountants.
11
<PAGE> 16
ORBIT/FR, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, revoking all previous proxies, hereby appoints Zeev
Stein, Shimon Alon and Uri Jenach or any of them acting individually, as the
proxy of the undersigned, with full power of substitution, to vote, as indicated
below and in their discretion upon such other matters as may properly come
before the Annual Meeting, all shares which the undersigned would be entitled to
vote at the Annual Meeting of the Company to be held at 10:00 A.M., eastern
standard time, May 19, 2000 at the Corporation Trust Center, 1209 Orange Street,
Wilmington, Delaware 19801, and at any adjournment or postponement thereof.
PLEASE DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE.
NO POSTAGE IS REQUIRED IF IT IS MAILED IN THE UNITED STATES.
ORBIT/FR, INC.
/s/ Irene Honeycutt
-----------------------------------------------
Irene Honeycut
Secretary
<PAGE> 17
1. ELECTION OF DIRECTORS:
[ ]FOR all nominees listed below
[ ]WITHHOLD AUTHORITY to vote for all nominees listed below
Nominees: For a term expiring at the next Annual Meeting of Stockholders:
Zeev Stein, Shimon Alon, Uri Jenach, Reuven Fattal.
(INSTRUCTION: To withhold authority to vote for any nominee(s), write the
name(s) of such nominee(s) on the line below.)
- --------------------------------------------------------------------------------
2. RATIFICATION OF APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS FOR
THE FISCAL YEAR ENDING DECEMBER 31, 2000:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(Please date and sign your Proxy on the reverse side and return it promptly)
This Proxy is solicited on behalf of the Board of Directors. Unless
otherwise specified, the shares will be voted "FOR" the election of all nominees
for director listed on the reverse side hereof and "FOR" ratification of
appointment of Ernst & Young LLP as the Company's independent auditors. This
Proxy also delegates discretionary authority with respect to any other business
which may properly come before the Annual Meeting or any adjournment or
postponement thereof.
The undersigned hereby acknowledges receipt of the notice of Annual
Meeting and Proxy Statement.
Date:____________________________________, 2000
Signature of Stockholder
Signature of Stockholder
NOTE: PLEASE SIGN THIS PROXY EXACTLY AS NAME(S)
APPEAR ON YOUR STOCK CERTIFICATE. WHEN SIGNING AS
ATTORNEY-IN-FACT, EXECUTOR, ADMINISTRATOR, TRUSTEE
OR GUARDIAN, PLEASE ADD YOUR TITLE AS SUCH, AND IF
SIGNER IS A CORPORATION, PLEASE SIGN WITH FULL
CORPORATE NAME BY A DULY AUTHORIZED OFFICER OR
OFFICERS AND AFFIX THE CORPORATE SEAL. WHERE STOCK
IS ISSUED IN THE NAME OF TWO (2) OR MORE PERSONS,
ALL SUCH PERSONS SHOULD SIGN.
