<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. 1)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] 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 Rule 14a-12
</TABLE>
MICRO-ASI, 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)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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:
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(5) Total fee paid:
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[ ] 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:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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<PAGE> 2
MICRO-ASI, INC.
12655 North Central Expwy.
Suite 1000
Dallas, TX 75243
Notice of Annual Meeting of Stockholders
To be Held on December 6, 2000
To the Stockholders of Micro-ASI, Inc.
NOTICE IS HEREBY GIVEN that the Annual meeting of Stockholders
of Micro-ASI, Inc., a Texas corporation (the "Company"), will be held at 10:00
a.m. (Local time) on Wednesday, December 6, 2000, at the Omni Richardson Hotel,
700 E. Campbell Road, Richardson, Texas, 75081, 972-231-9600, to consider and
act upon the following matters:
(1) To elect nine (9) directors to serve for the ensuing year or
until their successors are duly elected and qualified;
(2) To consider and vote on a proposal to amend the Company's
Second Amended and Restated Articles of Incorporation to
increase the authorized number of shares of Common Stock from
75,000,000 to 150,000,000, to increase the authorized number
of shares of Preferred Stock from 15,000,000 to 40,000,000,
and to authorize the Board of Directors of the Company to
determine the preferences, limitations and rights of any
Preferred Stock to be issued in the future; and
(3) To transact such other business as may properly come before
the meeting or any adjournment thereof.
Only stockholders of record of the Company's shares of Common
Stock and Series A Preferred Stock at the close of business on October 31, 2000
will be entitled to notice of and to vote at the meeting or any adjournment
thereof.
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU
OWN. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, THE BOARD OF
DIRECTORS URGES YOU TO SIGN, DATE AND RETURN THE ENCLOSED PROXY AS SOON AS
POSSIBLE.
By Order of the Board of Directors,
/s/ Joel E. Claybrook
Joel E. Claybrook
Vice Chairman and C.E.O.
Dallas, Texas
Dated: November 18, 2000
<PAGE> 3
MICRO-ASI, INC.
12655 North Central Expressway
Suite 1000
Dallas, TX 75243
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 6, 2000
----------
This Proxy Statement and the accompanying Proxy Card are being
furnished in connection with the solicitation by the Board of Directors of
Micro-ASI, Inc. (the "Company") of proxies to be voted at the Annual Meeting of
Shareholders to be held at 10:00 a.m. (local time) on Wednesday, December 6,
2000 at the Omni Richardson Hotel, 700 E. Campbell Road, Richardson, Texas 75084
and at any adjournment thereof, with respect to the matters referred to in the
accompanying notice. It is anticipated that this Proxy Statement and the
accompanying materials will first be mailed to shareholders on or about November
___, 2000.
ACTION TO BE TAKEN AT MEETING
The accompanying proxy, unless the shareholders otherwise
specifies in the proxy, will be voted:
(1) To elect nine directors to serve until the next Annual Meeting
or until their successors are duly elected and qualified;
(2) To consider and vote on a proposal to amend the Company's
Second Amended and Restated Articles of Incorporation to
increase the authorized number of shares of Common Stock from
75,000,000 to 150,000,000, to increase the authorized number
of shares of Preferred Stock from 15,000,000 to 40,000,000,
and to authorize the Board of Directors of the Company to
determine the preferences, limitations and rights of any
Preferred Stock to be issued in the future; and
(3) To transact such other business as may properly come before
the meeting or any adjournment thereof.
OUTSTANDING CAPITAL STOCK
The Company's shares of Common Stock, par value $.001 per
share and Preferred Stock, par value $.001 per share (the "Stock") are the only
outstanding classes of voting securities. Holders of record at the close of
business on October 31, 2000 (the "Record Date") are entitled to notice of and
to vote at, the Annual Meeting and any adjournment thereof. At the close of
business on October 31, 2000, there were issued and outstanding 30,906,261
Shares, of which there were 22,614,961 shares of Common Stock outstanding and
8,291,300 shares of Series A Preferred Stock outstanding, each entitled to cast
one vote.
QUORUM AND VOTING
The presence, in person, or by proxy, of the holders of a
majority of the outstanding Common and Preferred Stock is necessary to
constitute a quorum at the meeting. In deciding all questions, a holder of
Common or Preferred Stock is entitled to one vote, in person or by proxy for
each share held in his or her name on the record date. Abstentions may be
specified on all proposals except the election of directors. Abstentions, other
than for the election of directors, will have the same effect as a vote against
such proposal. Broker non-votes, if any, will not be included in vote totals
and, as such, will have no effect on any proposals.
<PAGE> 4
REVOCABILITY OF PROXIES
A shareholder may revoke a proxy at any time prior to its
exercise by (1) delivering to the Secretary of the Company a written notice of
revocation prior to the Annual Meeting, (2) delivering to the Secretary of the
Company prior to the Annual Meeting a duly executed proxy bearing a later date,
and (3) attending the Annual Meeting, filing a written notice of revocation with
the Secretary of the meeting, and voting in person.
PERSONS MAKING THE SOLICITATION
The accompanying proxy is being solicited by the Board of
Directors of the Company. In addition to solicitation by mail, directors,
officers and employees of the Company may solicit proxies for the Annual Meeting
from the shareholders of the Company personally or by telephone, mail, or
facsimile without additional remuneration therefore. The Company will also
provide persons, firms, banks and corporations holding Shares in their names or
in the names of nominees, which in either case are beneficially owned by others,
proxy materials for transmittal to such beneficial owners. The costs of this
solicitation are being borne by the Company and no other person or persons will
bear such risk either directly or indirectly.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table and notes thereto set forth, as of October
31, 2000, the name and number of voting shares of the Company's Common and
Preferred Stock, par value $.001 per share, held of record or beneficially by
each person who held of record or was known by the Company to own beneficially
more than 5% of the 22,614,961 issued and outstanding shares of the Company's
Common Stock or 8,291,300 shares of the Company's Preferred Stock and the
shareholdings of the executive officers and directors of the Company.
<TABLE>
<CAPTION>
Title of Class Name & Address Amount (1), (2) Percentage of Class
-------------- -------------- --------------- -------------------
<S> <C> <C> <C>
Common Cecil E. Smith, Jr. (3) 3,276,151 13.65%
Park Central Plaza I
12655 N. Central Expwy.
Suite 1000
Dallas, Texas 75243
Common Joel E. Claybrook (4) 1,426,700 6.09%
Park Central Plaza I
12655 N. Central Expwy.
Suite 1000
Dallas, Texas 75243
Common Dr. Meng-Sheng Lin (5) 1,300,000 5.69%
Park Central Plaza I
12655 N. Central Expwy.
Suite 1000
Dallas, Texas 75243
Common Dr. Myles B. Welborn 101,900 *
Common James R. Hamner (6) 255,000 1.12%
Common Dr. James A. Dukowitz (7) 425,000 1.85%
Common Scott E. Smith (8) 325,000 1.42%
Common Jerry D. Kline (9) 400,000 1.75%
Common Eaglestone Investment 2,100,000 8.50%
Partners I, LP (10),(11)
Preferred 3,627,444 43.75%
Common Signal Lake Venture Fund, 900,000 3.83%
LLC (11), (12)
Preferred 1,554,619 18.75%
Common Hare & Co. (11), (13) 1,200,000 5.04%
Preferred 2,072,825 25.00%
Common Gary Bottoms (14) 1,416,667 5.90%
Common Competitive Technologies, 300,000 1.31%
Inc. (11), (15)
Preferred 518,206 6.25%
Common Marise Segelov (11), (16) 300,000 1.31%
Preferred 518,206 6.25%
Robert J. Hoyt 1,800,000 7.96%
174 The Masters Circle
Costa Mesa, CA 92627
All Directors & Executive 7,509,791 28.52%
Officers as a Group 8
persons (17)
</TABLE>
* Denotes less than 1% ownership
2
<PAGE> 5
(1) The rules of the SEC provide that, for the purpose hereof, a person is
considered the "beneficial owner" of shares with respect to which the
person, directly or indirectly, has or shares the voting or investment
power, irrespective of his economic interest in the shares. Unless
otherwise noted, each person identified possesses sole voting and
investment power over the shares listed, subject to community property
laws.
(2) Based on a total of 22,614,961 shares of Common Stock issued and
outstanding as of the Record Date, shares of Common Stock subject to
options or warrants that are exercisable within 60 days of October 31,
2000, are deemed beneficially owned by the person holding such options
for the purposes of calculating the percentage of ownership of such
person but are not treated as outstanding for the purpose of computing
the percentage of any other person.
(3) Mr. Cecil E. Smith's shares include 350,000 and 1,041,335 shares that
could be purchased based on stock options and warrants held,
respectively.
(4) Mr. Joel E. Claybrook's shares include 350,000 shares and 450,0000
shares that could be purchased based on stock options and warrants held,
respectively.
(5) Dr. Meng-Sheng Lin's shares include 250,000 shares that could be
purchased based on stock options held.
(6) Mr. James R. Hamner's shares include 250,000 shares that could be
purchased based on stock options held.
(7) Dr. James A. Dukowitz's shares include 400,000 shares could be purchased
based on stock options held.
(8) Mr. Scott E. Smith's shares consist of 325,000 shares that could be
purchased based on stock options held.
(9) Mr. Jerry D. Kline's shares include 300,000 shares that could be
purchased based on stock options held.
(10) Eaglestone Investment Partners I, LP's shares of Common Stock consist of
2,100,000 shares that could be purchased based on warrants held.
(11) Dividends of preferred stock in the amount of 291,300 shares were
declared and issued through October 31, 2000 and have been included in
each preferred shareholders ownership.
(12) Signal Lake Venture Fund, LLC's shares of Common Stock consist of 900,000
shares that could be purchased based on warrants held.
(13) Hare & Company's shares of Common Stock consist of 1,200,000 shares that
could be purchased based on warrants held.
(14) Mr. Bottom's shares consist of 1,416,667 shares into which he has an
immediate right to convert a note due him from the Company for
$1,416,667.
(15) Competitive Technologies' shares of Common Stock consist of 300,000
shares that could be purchased based on warrants held.
(16) Marise Segelov's shares of Common Stock consist of 300,000 shares that
could be purchased based on warrants held.
(17) Includes 2,475,000 and 1,491,335 shares that could be purchased based on
stock options and warrants held, respectively.
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
Nine (9) directors are to be elected at the Annual Meeting to
hold office until their respective successors have been elected and qualified or
until their prior death, resignation or removal. The By-laws of the Company
provide that the Board of Directors ("Board")may determine the number of
directors from time to time. The Board has established the number of directors
at nine (9).
3
<PAGE> 6
To be elected a director, each nominee must receive a plurality of
all the votes cast at the meeting for the election of directors. Should any
nominee be unable to accept nomination or election, shareholders will vote for
the election of such other person to the office of director as management may
recommend in place of such nominee; however, management knows of no reason to
anticipate that this will occur. Unless a proxy specifies that it is not to be
voted in favor of a nominee for director, it is intended that Shares represented
by the proxy will be voted in favor of the nominees listed below.
The following table sets forth certain information with respect to
each nominee for election as a director. There are no arrangements or
understandings between the Company and any director or nominee pursuant to which
such person was elected or nominated to be a director of the Company. For
information with respect to security ownership of directors, see "Share
Ownership of Certain Beneficial Owners and Management."
Nominees for election of directors are as follows:
<TABLE>
<CAPTION>
FIRST YEAR
BECAME A
NAME AGE POSITION DIRECTOR
---- --- -------- -----------
<S> <C> <C> <C>
Cecil E. Smith, Jr. 63 Chairman of the Board 1995
Joel E. Claybrook 51 Vice Chairman, CEO, and CFO 1997
Dr. Myles B. Welborn 71 Director 1999
James R. Hamner 63 Director 1999
Dr. Meng-Sheng Lin 56 Director 1999
Jeffery D. Warren 43 Director 2000
Dr. Bart W. Stuck 53 Director 2000
David A. Ranhoff 45 Director 2000
Patrick J. Trippel 40 Director 2000
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF
SUCH NOMINEES.
Set forth below is certain information concerning each of the
persons nominated for election as directors of the company.
CECIL E. SMITH, JR., serves as Chairman of the Board of Directors. Since 1973,
Mr. Smith has served as Chief Executive Officer of S&N Corporation ("S&N"), a
provider of strategic planning and business development services to the
electronics industry. From 1996 to October 1999, Mr. Smith served as a contract
employee to the Company and joined the Company on a full time basis in October
1999. Mr. Smith served as a director for Microelectronic Packaging Systems, Inc.
from 1991 to 1996, and as Executive Vice President and Director of Alcoa
Electronic Packaging, Inc. from December, 1988 to March, 1992. Mr. Smith
attended the University of Texas and performed advanced studies with the
American Management Association (Executive Development) in Hemphill, New York
and Bell Laboratories (Advanced Semiconductor Technology) Phillipsburg,
Pennsylvania.
JOEL E. CLAYBROOK, serves as Vice Chairman, Chief Executive Officer and Chief
Financial Officer of the Company. Mr. Claybrook has 28 years of experience in
finance, marketing, and administrative management including over 10 years of
experience in sales management with the high tech and communications industries.
Prior to joining Micro-ASI, Inc. in 1998, Mr. Claybrook, served four years as
General Partner of Hawk Financial Company, Ltd., an automobile finance company.
From 1992 to 1993, he served as Chief Financial Officer for Pinpoint
Communications, Inc., a Texas-based high-tech wireless data communications
company. Mr. Claybrook, a Certified Public Accountant since 1974, has served as
chief financial officer of several companies and practiced as a financial
consultant to the service, distribution, and manufacturing industries. He
received a Bachelor of Business Administration degree in 1971 from The
University of North Texas.
4
<PAGE> 7
DR. MYLES B. WELBORN, has 40 years experience in dentistry, and has served as
teacher and principal in the Texas school system. Upon earning a Bachelors
Degree from Hardin-Simmons Universtiy in 1949, Dr. Welborn served in the Army
for three years, attaining the rank of Cpl. Chief of Congressional Section of
the General's Office. After the military, he spent several years in education as
a teacher and principal in elementry schools. Dr. Welborn attended the Baylor
College of Dentistry, earning a DDS with honors. Since 1960 he has been
practicing dentistry.
JAMES R. HAMNER, serves as member of the Board of Directors and Director of
Strategic Communications, and is a member of the Executive Committee. Jim has
over 40 years of business experience, primarily specializing in information
technology. He began his professional career in 1960 at the U.S. Naval Ordnance
Laboratory in Corona, California where he designed and deployed early computing
capabilities for guided missile development and testing. Mr. Hamner worked for
32 years at Texas Instruments in multiple technical, administrative and
management roles supporting several TI business entities, and then was employed
as a Senior Manager for Andersen Consulting in Dallas, Texas. Mr. Hamner holds a
BA in Mathematics from Baylor University.
DR. MENG-SHENG LIN, serves as a member of the Board of Directors and as Director
of International Development. Dr. Lin has taught and practiced medicine for 29
years. Dr. Lin earned her Doctor of Medicine degree from Peking China Medical
College in 1970. As well, from 1982-83, Dr. Lin was a Postdoctoral Fellow with
the World Health Organization at the M.D. Anderson Hospital & Tumor Center,
University of Texas Health Science Center, Houston, Texas.
JEFFREY D. WARREN, serves as an outside member of the Board of Directors. Warren
joined Eaglestone Capital Services, Inc. in September 1998 to assist in the
analysis, negotiation and execution of investment opportunities for Eaglestone.
Warren was a corporate finance lawyer for approximately 17 years before joining
Eaglestone, and also provided independent consulting services to merchant
bankers and entrepreneurs engaged in acquisition transactions. Warren practiced
law with Chamberlain, Hrdlicka in Houston, Texas, Squire, Sanders & Dempsey and
its effective predecessors in Phoenix, Arizona, and with Keesal, Young & Logan
in Los Angeles, California. As a corporate finance attorney, Warren managed a
broad array of corporate finance, merger and acquisition and other transactions.
As a consultant, Warren was actively involved in analysis and execution of
acquisition transactions, primarily in the business consolidation area, and also
in providing general business advice. He earned a B.A. from Purdue University
and earned his J.D. from the University of Houston, both with honors. Warren
also currently serves as a member of the Board of Directors of Floral Works,
Inc.
DR. BART W. STUCK, serves as an outside member of the Board of Directors. In
1999 he co-founded Signal Lake Venture Fund LP, a Westport, Connecticut and
Boston, Massachusetts based early stage venture capital fund. In 1984 Dr. Stuck
founded Business Strategies LLC to work with leading edge computer
communications, hardware and software, equipment and services firms. From 1972
to 1984 he worked at Bell Laboratories in signal processing basic research. Dr.
Stuck has published more than thirty technical papers and served on the Board of
Governors of the IEEE Communications Society from 1984 to 1986. Hel holds the
degrees of SBEE, SMEE and ScD all in electrical engineering from the
Massachusetts Institute of Technology, Cambridge, Massachusetts.
DAVID A. RANHOFF, serves as Executive Vice President and Chief Operting Officer
of Credence Systems Corporation. At Credence, Mr. Ranhoff has responsibility for
Credence's five operating divisions including worldwide marketing, engineering,
manufacturing, sales and service. Mr. Ranhoff held a series of management
positions within Credence including Co-President, Executive Vice President Sales
and Marketing, Serior Vice President Sales & Service and Vice President and
Managing Director of European Operations. Mr. Ranhoff previously served in a
variety of positions at GenRad and Axiom Technology and now serves on the Boards
of Micro-ASI, Elmos Semiconductor AG, Fluence Technology and ICC.
5
<PAGE> 8
PATRICK J. TRIPPEL, serves as President of Siemens Electronics Assembly Systems,
Inc. and is responsible for all marketing, sales and post-sales support for
Siemens surface mount products. Mr. Trippel also serves as General Manager of
the Global Solutions Provider business at Siemens. Mr. Trippel previously served
as Latin America Operations Manager and Southwest Regional Manager for Universal
Instruments Corporation. Mr. Trippel began his career with AMP Incorporated as a
Sales Engineer. Mr. Trippel holds a BS from Purdue University in Industrial
Engineering and has completed advanced studies at the University of Chicago,
Duke University and the University of Dallas. Mr. Trippel also serves on the
Boards of Advisors of ISSI Corp. and Gwinnett Technical College.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF
SUCH NOMINEES.
BOARD MEETINGS, ATTENDANCE AND COMMITTEES
The Board of Directors formed four standing committees, Audit,
Compensation, Benefits and Nominating in 2000. The Board of Directors held
twelve (12) meetings during the year commencing November 1, 1999 and ending
October 31, 2000. During this period all directors attended at least 75% of the
meetings of the Board of Directors.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under Federal securities laws, the Company's directors, its
executive officers and any person holding more than 10% of the Company's Shares
are required to report their ownership of the Company's Shares and any changes
in that ownership to the Securities and Exchange Commission ("SEC") on the SEC's
Forms 3, 4 and 5. The Company believes that all of its officers and directors
have complied with all filing requirements applicable to them with respect to
their stock ownership on October 31, 2000.
EXECUTIVE OFFICERS
The board elects executive officers annually at its first meeting following the
Annual Meeting of Shareholders. In addition to the executive officers who are
directors, the following are also elected officers.
DR. JAMES A. DUKOWITZ, 54, is the Executive Vice President and Chairman of the
Executive Committee of the Office of the Chief Executive. Dr. Dukowitz holds a
Ph.D. from the Massachusetts Institute of Technology, where he also served as
Special Assistant to MIT President Dr. Jerome Wiesner to establish the
Congressional Office of Technology Assessment. Prior to 1999, Dr. Dukowitz spent
over 20 years with Texas Instruments, Dallas, Texas, serving as President of TI
Asia and TI China for six years; Vice President of European and Latin American
Marketing; and Vice President, Corporate Staff with responsibilities for
Corporate Strategic Planning, Corporate Marketing, and Corporate Relations.
SCOTT E. SMITH, 41, President, has been with the Company since February 1999 and
is responsible for manufacturing operations. For the prior year, Mr. Smith was
General Manager of the Dallas based manufacturing operations of Xetl
Corporation, a large subcontract manufacturer of semiconductor products. Prior
to his Xetl experience, Mr. Smith served six years as Vice President Marketing
and Sales for Outsource Solution, Inc. He has more than 16 years of electronic
manufacturing experience in both the United States and Mexico. He has been
involved in a number of successful start-up operations and specializing in
semiconductor packaging and manufacturing. Mr. Smith is a 1982 graduate of
Baylor University with a Bachelor of Science degree. Scott is the son of Cecil
E. Smith, Jr.
JERRY D. KLINE, 42, Vice President of Technological Development, has been with
the Company since February 1999 and is responsible for Technological
Development. Prior
6
<PAGE> 9
to joining the Company, Mr. Kline served 15 years with Raytheon Systems as
Manager of Hardware Design for major military weapons systems. His most recent
assignment at Raytheon was a $30,000,000 upgrade to a key avionics package for
the F-16 aircraft. He is a 1980 graduate of Texas A&M University with a Bachelor
of Science in Electrical Engineering degree and is a member of the Institute of
Electrical and Electronics Engineers.
EXECUTIVE COMPENSATION
The following Summary Compensation Table shows cash and non-cash
compensation for the last three fiscal years paid by the Company to the Chief
Executive Officer and President of the Company. No other executive officers of
the Company received salary and bonus compensation, which exceeded $100,000 in
such fiscal years.
The entire Board of Directors agreed on the salaries set forth in
the Summary Compensation Table below. These amounts were based on the fair
market value of employees considering their experience and anticipated
contributions to the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Securities
Underlying All Other
Name and Fiscal Salary Options/SAR's Compensation
Principal Position Year ($) (1) (#)(6)(7) ($)(2) (3)
------------------ ------ ------- ------------- ------------
<S> <C> <C> <C> <C>
Cecil E. Smith, Jr. 1999 45,000 750,000 255,000
Chairman of the 1998 330,000
Board (2) 1997 135,000
Joel E. Claybrook 1999 180,000 750,000
Vice Chairman, Chief 1998 95,000
Executive Officer,(3) 1997 40,000
Chief Financial Officer
Dr. James A. Dukowitz 1999 15,000 400,000
Executive Vice President
& Chairman of the
Executive Committee of
the Office of the Chief
Executive (4)
Scott E. Smith 1999 110,000 325,000
President
Dr. Meng-Sheng Lin 1999 90,000 500,000
Director of Int'l
Development (5)
</TABLE>
----------
(1) Salaries shown above are for the twelve months ended December 31, 1999.
(2) Cecil E. Smith, Jr. received consulting fees and expenses in lieu of salary
until October 1, 1999. This consulting agreement ended September 30, 1999
when Mr. Smith became an employee of the Company.
(3) Joel E. Claybrook received consulting fees and expenses in lieu of salary
until December 31, 1998. This consulting agreement ended December 31, 1998
when Mr. Claybrook became an employee of the Company.
(4) Dr. James A. Dukowitz joined the Company September 1, 1999. He deferred
$45,000 of his salary from 1999 until 2000.
(5) Dr. Lin joined the Company July 1, 1999.
(6) The above officers and Directors were granted options pursuant to the 1999
Stock Option Plan. The total options granted have been included in the above
table.
(7) A Special Meeting of the Shareholders was held on March 1, 2000 at which
time the Shareholders approved an increase in the authorized shares of
Common Stock and Preferred Stock.
7
<PAGE> 10
OPTION EXERCISES AND HOLDINGS
The following table sets forth information regarding options granted
under the 1999 Stock Option Plan for each of the executive officers and
employees named below:
<TABLE>
<CAPTION>
% of
Number of Total Number of % of
Securities Incentive Securities Total Exercise
Underlying Options Exercise Underlying Non-Qualified Price
Incentive Granted Price Non-Qualified Options per
Options (#) in 1999/ Per Expiration Options Granted Share Expiration
Name (1) (2) 2000 Share ($) Date (#)(3) in 1999 ($) Date
------------------- ----------- --------- --------- ----------- ------------- ------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Cecil E. Smith, Jr. 500,000 25.06% 1.10 9/6/2004 250,000 50.00% 1.00 9/6/2009
Joel E. Claybrook 500,000 25.06% 1.10 9/6/2004 250,000 50.00% 1.00 9/6/2009
Dr. Meng-Sheng Lin 500,000 25.06% 1.00 9/6/2009
Scott E. Smith 250,000 12.53% 1.00 9/6/2009
Jerry D. Kline 200,000 10.03% 1.00 9/6/2009
James R. Hamner 200,000 6.21% 1.00 8/4/2010
</TABLE>
(1) No shares have been exercised under this Plan.
(2) The Incentive options are first exercisable 25% at the time of grant, 25%
after one year, 25% after two years and 25% after three years. The exercise
price is $1.00 per share except for Messer's. Cecil E. Smith, Jr. and
Joel E. Claybrook who have an exercise price of $1.10 per share.
(3) The Nonqualified options are first exercisable 20% per year for five years
beginning in 1999 at $1.00 per share.
CERTAIN TRANSACTIONS
Cecil E. Smith, Jr., Chairman of the Board was retained by the
Company under a consulting agreement that ended September 30, 1999, at which
time he joined the Company as a full time employee. Prior to becoming an
employee, Mr. Smith was paid consulting fees plus travel expenses, which are
shown in the Summary Compensation Table listed under All Other Compensation for
the years 1997, 1998 and 1999.
On May 7, 1999, the Company entered into a consulting contract with
Darwin's Beagle.Com, Inc. Ari Reubin and Dr. James Dukowitz were members of the
consulting firm. The Company paid Darwin's Beagle.Com, Inc. consulting fees per
their contract in the amount of $70,000.00 in cash for services rendered from
May 1999 through August 1999. Subsequently, Ari Reubin and Dr. James Dukowitz
became employees of the Company in September 1999. The agreement also called for
the issuance of 28,000 shares of the Company's Common Stock, which were issued
in March 2000.
APPROVAL OF AMENDMENT TO ARTICLES OF INCORPORATION
(PROPOSAL NO. 2)
The company's Second Amended and Restated Articles of
Incorporation (the "Articles") currently provide that the Company is authorized
to issue 75,000,000 shares of Common Stock and 15,000,000 shares of Preferred
Stock. In November 2000, the Board authorized an amendment to the Articles,
subject to shareholder approval, to increase the authorized number of shares of
Common Stock to 150,000,000 shares and to increase the authorized number of
shares of Preferred Stock to 40,000,000 shares.
The terms of the additional authorized shares of Common Stock will
be the same as those that apply to the currently authorized shares of Common
Stock. Adoption of the amendment and any future issuance of the Common Stock
would not affect the rights of the holders of currently outstanding Common Stock
of the Company, except for effects incidental to increasing the number of shares
of the Company's Common Stock outstanding, such as dilution of the earnings per
share and voting rights of current holders of Common and Preferred Stock.
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<PAGE> 11
Adoption of the amendment would authorize the Board to determine
the terms, preferences, limitations and rights of the additional as well as the
currently authorized shares of Preferred Stock. The proposed amendment would
also give the Board the authority to issue additional shares of Common Stock and
Preferred Stock without requiring future shareholder approval of such issuances
except as may be required by applicable law. The shares could be used for such
purposes as acquisitions and equity financings. The Board has no present
agreement or arrangement to issue any of the additional shares.
The increase in the authorized number of shares of Common Stock
and Preferred Stock and the subsequent issuance of such shares (within the
limits imposed by applicable law) could have the effect of delaying or
preventing a change in control of the Company without further action by the
shareholders. Any such issuance of additional stock could have the effect of
diluting the earnings per share and book value per share of outstanding shares
of Common Stock and Preferred Stock, and such additional shares could be used to
dilute the stock ownership or voting rights of persons seeking to obtain control
of the Company.
Holders of the Common Stock of the Company do not now have
preemptive rights to subscribe for or purchase additional shares of Common Stock
or Preferred Stock and will have no preemptive rights to subscribe for or
purchase any of the authorized shares of Common Stock or Preferred Stock that
will be available for issuance as a result of the increase in the number of
authorized shares of Common Stock and Preferred Stock.
As of October 31, 2000, 22,614,961 shares of Common Stock were
issued and outstanding, 10,000,000 shares of Common Stock were reserved for
issuance in connection with stock options granted under the 1999 Stock Option
Plan, 500,000 shares of Common Stock were reserved for issuance in connection
with stock in the Employee Stock Purchase Plan, 1,625,000 shares of Common Stock
are reserved for stock options granted outside of the 1999 Stock Option Plan and
6,291,335 shares are reserved for the exercise of Warrants. In connection with
the acquisition of Best Technologies, Inc. ("BTI"), an additional 1,416,667
shares have been reserved for future issuance. As of October 31, 2000, there
were 8,291,300 shares of Series A Preferred Stock issued and outstanding and
1,308,700 reserved for future dividends to the Series A Preferred shareholders.
At least two thirds of the issued and outstanding Common and
Preferred Stock and a majority of the issued and outstanding Preferred Stock
voting as a class must approve this amendment.
RECOMMENDATION OF THE BOARD
THE BOARD HAS UNANIMOUSLY APPROVED THE AMENDMENT TO THE ARTICLES AND RECOMMENDS
THAT THE SHAREHOLDERS VOTE "FOR" THIS PROPOSAL.
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<PAGE> 12
OTHER MATTERS
(PROPOSAL NO. 3)
The Board of Directors is not aware of any other matters which are
likely to be brought before the Annual Meeting. However, in the event that any
other matters properly come before the Annual Meeting, it is intended that the
person named in the accompanying proxy will vote the Shares represented by all
properly executed proxies on such matters in such manner as shall be determined
by a majority of the Board of Directors.
THE COMPANY BECAME A REPORTING COMPANY UNDER THE 1934 ACT ON
NOVEMBER 2, 1999. THE COMPANY WILL PROVIDE, FREE OF CHARGE, TO ALL SHAREHOLDERS
A COPY OF ITS ANNUAL REPORT ON FORM 10-KSB (WITHOUT EXHIBITS) AND/OR A COPY OF
ITS QUARTERLY REPORTS ON FORM 10-QSB (WITHOUT EXHIBITS), UPON WRITTEN REQUEST OF
SUCH SHAREHOLDER TO DAVID G. MCLANE, SECRETARY, Micro-ASI, Inc., 12655 NORTH
CENTRAL EXPRESSWAY, SUITE 1000, DALLAS, TEXAS 75243.
SHAREHOLDER PROPOSAL FOR 2001 ANNUAL MEETING
An eligible shareholder who wishes to submit a proposal to be
included in the Company's proxy materials for the 2001 Annual Meeting of
Shareholders must submit it, in accordance with the SEC's Rule 14a-8, so that it
is received by the Company's Secretary at the principal executive offices, on or
before July 21, 2001.
A shareholder who wishes to make a proposal at the 2001 Annual
Meeting of Shareholders without complying with the requirements of Rule 14a-8
(and therefore without including the proposal in the Company's proxy materials)
must give written notice of that proposal to the Company's Secretary, at the
Company's principal executive offices, by October 3, 2001. If a shareholder
fails to timely give that notice, then the persons named as proxies in the proxy
cards solicited by the Company's Board of Directors for that meeting will be
entitled to vote the proxy cards held by them regarding that proposal, if
properly raised at the meeting, in their discretion.
By Order of the Board of Directors
Joel E. Claybrook
Vice Chairman and CEO
Dated: November 18, 2000
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<PAGE> 13
MICRO-ASI, INC.
PROXY
The undersigned hereby (i) acknowledges receipt of the notice dated November
18, 2000, of the Annual Meeting of Shareholders of Micro-ASI, Inc. (the
"Company") to be held at 10:00 am local time on Wednesday, December 6, 2000, at
the Omni Richardson Hotel, 700 E. Campbell Road, Richardson, Texas, 75081, and
the proxy statement in connection therewith; and (ii) appoints CECIL E. SMITH,
JR. and JOEL E. CLAYBROOK and each of them, the undersigned's proxies with full
power of substitution, for and in the name, place and stead of the undersigned,
to vote upon and act with respect to all of the shares of Common Stock of the
Company standing in the name of the undersigned or with respect to which the
undersigned is entitled to vote and act, at the meeting and at any adjournment
thereof, and the undersigned directs that this proxy be voted as follows:
(1) Proposal to elect nine (9) directors to serve until the 2001 Annual
Meeting of Stockholders, or until their respective successors are elected
and qualified
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote
(except as marked to the contrary) for all nominees listed below
Directors: Cecil E. Smith, Jr., Joel E. Claybrook, Dr. Myles B. Welborn,
James R. Hammer, Dr. Meng-Shen Lin, Jeffrey D. Warren,
Dr. Bart W. Stuck, David A. Ranhoff and Patrick J. Trippel.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
WRITE THAT NOMINEE'S NAME IN THE SPACE BELOW.)
----------------------------------------------------------------------------
(2) Proposal to approve the amendment the Company's Amended and Restated
Articles of Incorporation to increase the authorized number of shares of
Common Stock from 75,000,000 to 150,000,000 and to increase the authorized
number of shares of Preferred Stock from 15,000,000 to 40,000,000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(3) In the discretion of the proxies on any other matter that may properly come
before the meeting or any adjournment there of.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
THIS PROXY WILL BE VOTED AS SPECIFIED ABOVE. IF NO SPECIFICATION IS MADE, THIS
PROXY WILL BE VOTED FOR THE MATTERS SPECIFICALLY REFERRED TO ABOVE.
If more than one of the proxies named above shall be present in person or by
substitute at the meeting or any adjournment thereof, both of the proxies so
present and voting, either in person or by substitute, shall exercise all of the
proxies hereby given.
The undersigned hereby revokes any proxy or proxies heretofore given to vote
upon or act with respect to such Common Stock and Series A Preferred Stock and
hereby ratifies and confirms all that the proxies, their substitutes, or any of
them may lawfully do by virtue hereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
[ ] I PLAN TO ATTEND THE ANNUAL MEETING.
DATED:
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SIGNATURE OF SHAREHOLDER
TELEPHONE:
---------------------------- ------------------------------------------
NAME (please print)
NUMBER AND
CLASS OF SHARES:
------------------ ------------------------------------------
------------------ SIGNATURE OF JOINT SHAREHOLDER
(if applicable)
------------------------------------------
NAME OF JOINT SHAREHOLDER (please print)
------------------------------------------
TITLE (if applicable)
When signing as an attorney, administrator, executor, guardian or trustee,
please add your title as such. If executed by a corporation or other entity, the
proxy should be signed by a duly authorized officer or representative of such
entity. Each joint tenant should sign the proxy.
NOTE: PLEASE MARK, SIGN, DATE AND RETURN VIA MAIL OR FACSIMILE (972-392-9639)
THIS PROXY CARD PROMPTLY TO:
MICRO-ASI, INC.
12655 N. Central Expressway
Suite 1000
Dallas, Texas 75243
