BOONTON ELECTRONICS CORPORATION
25 Eastmans Road, P. O. Box 465
Township of Hanover
Parsippany, New Jersey 07054-0465
-----------------------------------------------------------
February 28, 1997
TO: THE HOLDERS OF THE COMMON STOCK OF
BOONTON ELECTRONICS CORPORATION
Enclosed is a copy of the Corporation's Annual Report for its fiscal
year ended September 30, 1996.
Annexed to this letter is the Notice of Annual Meeting of the
Stockholders to be held March 24, 1997.
The persons names in the enclosed form of Proxy propose to vote for the
election of two Directors. If at the time of election any of the foregoing
nominees are unavailable, the persons acting as proxies may, in their judgment,
vote for other nominees.
Sincerely,
By /s/ John E. Titterton
-------------------------
John E. Titterton
Secretary
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BOONTON ELECTRONICS CORPORATION
25 Eastmans Road, P. O. Box 465
Township of Hanover
Parsippany, New Jersey 07054-0465
-----------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of
BOONTON ELECTRONICS CORPORATION:
Please take notice that the Annual Meeting of Stockholders of BOONTON
ELECTRONICS CORPORATION will be held at the offices of the Corporation at 25
Eastmans Road, Township of Hanover, New Jersey, Thursday, the 24th day of March,
1997 at 3:00 o'clock in the afternoon for the following purposes:
1. To elect two Directors; and
2. To transact such other business as may properly come before the
meeting.
Only stockholders of record as of the close of business on January 30,
1997 will be entitled to vote at the meeting.
If you wish your stock to be voted and you do not expect to be present
in person at the meeting, please fill in, sign, and return the enclosed proxy in
the envelope provided.
This NOTICE is sent by order of the Board of Directors.
Sincerely,
By /s/ John E. Titterton
------------------------
John E. Titterton
Secretary
February 28, 1997
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BOONTON ELECTRONICS CORPORATION
25 Eastmans Road, P. O. Box 465
Township of Hanover
Parsippany, New Jersey 07054-0465
----------------------------------------------------------
PROXY STATEMENT
----------------------------------------------------------
The accompanying Proxy is solicited by the Board of Directors of the
Corporation for use at the Annual Meeting of Stockholders to be held on March
24, 1997. The persons named as proxies were selected by the Board of Directors
of the Corporation and are Directors of the Corporation.
Any stockholder giving a Proxy has the right to revoke it by notice in
writing to the Secretary of the Corporation at any time prior to its use.
The Corporation will pay the cost of soliciting Proxies in the
accompanying form. Proxies may be solicited by Directors, officers and other
employees of the Corporation personally, by mail, by telephone or by facsimile.
On request, the Corporation will pay brokers and other persons holding shares of
stock in their names or in those of their nominees for their reasonable expenses
in sending soliciting material to, and seeking instructions from, their
principals.
The information contained in this Proxy Statement with respect to the
nominees for the Board of Directors is based upon information furnished by them.
This Proxy Statement and the accompanying Proxy are first sent to
stockholders on February 28, 1997.
VOTING SECURITIES
---------------------
The Corporation has only one class of stock, which has the sole voting
power. At the date of this Statement there were 1,636,585 shares of the
Corporation's capital stock issued and outstanding entitled to vote. Each share
outstanding on the record date will be entitled to one vote at the meeting. Only
stockholders of record at the close of business on January 30, 1997 will be
eligible to vote at the meeting. Fifty-one (51%) percent of the outstanding
shares will constitute a quorum at the meeting.
The following tabulation lists, as to (i) each present Director of the
Corporation, (ii) each other person known to the Corporation to be the
beneficial owner of more than five percent (5%) of the voting stock of the
Corporation, and (iii) all Directors and officers as a group, the number and
percentage of the Corporation's voting common stock owned by such beneficial
owner, Director and group on the date indicated. Except as reflected in the
tabulation, all shares are
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directly owned by the named individuals and group members, and such individuals
and group members possess sole voting and investment power with respect to such
shares.
<TABLE>
<CAPTION>
Number of Shares
Beneficially Owned
Beneficial Owner on February 21, 1997 Percentage Ownership
- ----------------------------------------- --------------------------------- --------------------------------
<S> <C> <C>
Daniel Auzan (Director) -* 0.00%
c/o Metrix, S.A.
Parc Les Glaisins
6, Avenue du Pre de Challes
B.P. 330-74943
Annecy-le-Vieux Cedex,France
Ronald T. DeBlis (Director) 63,648 3.89%
37 Farmstead Road
Short Hills, NJ 07078
Jack Frucht (Director) 36,782 2.25%
380 Mountain Road, Apt. 512
Union City, NJ 07087
Abel Sheng (Director) 134,859 8.24%
443 Northfield Avenue
West Orange, NJ 07052
Otto M. York (Director) 181,087 11.06%
130 Hempstead Court
Madison, NJ 07940
John M. Young (Director) 130,606** 7.98%
9749 Maplecrest Circle, S.E.
LeHigh Acres, FL 33936
G.E.M. USA, Inc. 260,300 15.91%
Holmes Bailey 215,000 13.14%
44 Nottingham Road
Short Hills, NJ 07078
- ----------------------------------------- --------------------------------- --------------------------------
All directors and officers 819,882*** 49.72%
as a group (8 persons)
- ----------------------------------------- --------------------------------- --------------------------------
</TABLE>
*Mr. Auzan is the indirect beneficial owner of the shares owned by G.E.M.
USA, Inc.
**Includes 6,000 shares owned by his wife to which Mr. Young disclaims
beneficial ownership.
***Includes 12,500 shares which may be acquired on exercise of outstanding
options.
- --------------------------------------------------------------------------------
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SHAREHOLDERS VOTING AGREEMENT
-----------------------------
The Corporation, on October 21, 1996, entered into a Subscription and
Option Agreement with G.E.M. USA, Inc. ("GEM"), whereby the Corporation agreed
to sell Eighty Thousand (80,000) of the authorized but unissued common shares in
the Corporation for the Subscription Price of Two Hundred Thousand Dollars
($200,000.00), which amount was paid on December 9, 1996.
In addition, in consideration for One Dollar ($1.00) and other good and
valuable consideration, the Corporation granted to GEM an option (the "Option")
until June 9, 1997, to subscribe for Four Hundred Forty-Three Thousand Seven
Hundred (443,700) of the authorized but unissued common shares in the
Corporation at the price of Three Dollars Twenty-Four Cents ($3.24) per share
or, in the aggregate, One Million Four Hundred Thirty-Seven Thousand Five
Hundred Eighty-Eight Dollars ($1,437,588.00).
In connection with the execution of the Subscription and Option
Agreement by and between GEM and the Corporation, certain Director-Shareholders
("Shareholders") of the Corporation, being RONALD T. DeBLIS, JACK FRUCHT, and
JOHN M. YOUNG, entered into a Shareholders and Voting Agreement, together with
GEM and the Corporation, which provides for, among other things, the following
provisions:
The Shareholders hereby agree to retain, vote, transfer or encumber
their respective Shares, owned by them as of the date of this Agreement or
thereafter acquired pursuant to an existing option, only in the manner and upon
the terms provided for in this Agreement, and further agree that none of the
Shares, nor any interest in all or any part of the Shares shall be sold,
assigned, pledged, given or otherwise transferred or encumbered (except with
respect to encumbrances arising from the purchase of Shares on margin), in any
manner and upon the terms and conditions provided for in this Agreement.
The Company shall not cause nor permit the transfer of any of the
Shares to be made on its books unless the transfer is permitted by this
Agreement, and has been made in accordance with its terms.
None of the Insider Shares nor any interest in all or any part thereof
may be sold, assigned, pledged, given or otherwise transferred or encumbered
(except with respect to encumbrances arising from the purchase of Shares on
margin), voluntarily or otherwise, to any person or entity, except by complying
with the terms, conditions and provisions of this Agreement. Nothing herein
shall restrict the right of GEM to sell, assign, pledge or otherwise transfer
the GEM Shares.
Upon the death, permanent disability or filing of a petition in
bankruptcy by or against an Insider Shareholder, GEM shall have the option to
purchase and, upon the exercise of such option, the legal representative of the
deceased Insider Shareholder, or such Insider Shareholder, as the case may be,
shall sell to GEM the Shares held by such Insider Shareholder or deceased
Insider Shareholder for a price equal to the average trading price per share of
the Company's registered shares for the last One Hundred Thousand (100,000)
shares sold though market makers authorized to sell the Shares during the period
immediately preceding the death,
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permanent disability, or entry of an order for relief in the bankruptcy
proceedings commenced by or against such Insider Shareholder.
The Shareholders agree among themselves, and with the company, that
they shall attend all meetings of Shareholders, in person or by proxy, and/or
execute all necessary unanimous written consents of the Shareholders and/or call
such special meeting of all the Shareholders of the Company as may be necessary
or desirable to accomplish the purpose and intent of the provisions of this
Agreement, in accordance with the principles set forth in this Agreement.
Each Shareholder agrees to take all action, including, but not limited
to, the voting of the capital stock of the Company owned by such Shareholder, so
that the Board of Directors of the Company shall consist of seven (7) qualified
directors including at least two qualified members designated by GEM, one of who
will serve as chairman of the Board of Directors. In the event of the
resignation, death, disqualification or removal by the Company or the Board of
Directors of any member of the Board of Directors designated by GEM, the
Shareholders agree to replace such director(s) with member(s) designated by GEM
and, to the extent necessary, to cause a notice of special shareholders' meeting
to be sent to each shareholder of record of the Company in accordance with the
By-laws of the Company, stating the purpose of the meeting and naming such
designee(s). At the meeting called pursuant to such notice, each of the
Shareholders shall vote his Shares so as to elect the nominee(s) of GEM as a
director of the Company.
In the event the Board of Directors of the Company causes or allows any
of the acts set forth in subsection (a) through (k) below to be taken (or
approves or allows any acts to be taken which contemplate the taking of any of
the acts described in subsection (a) through (k) below) without the consent of
the Board members designated by GEM, or allow any act or event described in
subsection (1) below to occur, each of the Shareholders agrees to cause (and/or
to cause the Board of Directors to cause) a notice of a special shareholders'
meeting to be called and served upon each shareholder of record of the Company
in accordance with the By-laws of the Company, for the purpose of removing the
existing Board of Directors, voting for a new Board of directors and naming
seven (7) designees to the Board, which shall include at least four (4) members
designated by GEM. At the meeting called pursuant to such notice, the
Shareholders agree to take all action, including, but not limited to, the voting
of the capital stock of the Company owned by such Shareholder, so that the Board
of Directors of the Company shall consist of seven (7) qualified directors,
including at least four (4) qualified members designated by GEM.
(a) Any amendment, alteration or repeal of any provision of the
Certificate of Incorporation or By-laws of the Company;
(b) The dissolution or liquidation, or the taking of any action
authorizing the dissolution or liquidation of the Company;
(c) Increasing the authorized shares of capital of the Company,
creating any new class or series of stock, or approving and/or authorizing any
recapitalization of the shares of capital stock of the Company;
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(d) The payment of any dividend on the common stock of the Company,
whether in cash or in securities of the Company or of any other entity, or the
making of any distribution to the shareholder of the Company;
(e) The approval or acceptance of any plan of redemption or acquisition
by the Company of any of its shares of capital stock;
(f) Any increase in the size of the Board of Directors;
(g) The termination of, or modification or amendment to, the powers and
duties of the Budget Committee, Compensation Committee, Audit Committee or
Environmental Committee;
(h) The appointment to each of the Environmental Committee,
Compensation Committee and Audit Committee of representatives or persons other
than Daniel Auzan, Ronald T. DeBlis and Otto H. York, (or any successor
unanimously approved by such committee's existing members), or the removal of
Daniel Auzan, Ronald T. DeBlis or Otto York (or any of their approved
successors) from such committees;
(i) The appointment to the Budget Committee of representatives or
persons other than Daniel Auzan, Otto H. York and Ronald T. DeBlis (or any
successor unanimously approved by such committee's existing members), or the
removal of any of Daniel Auzan, Otto H. York or Ronald T. DeBlis (or any of
their approved successors) from such committee;
(j) The removal of Daniel Auzan as Chairman of the Board of Directors
and Otto H. York as Vice Chairman of the Board of Directors of the Company
during their elected terms;
(k) Any increase in the compensation of any employee of the Company
other than as authorized by the Compensation Committee; or
(l) The occurrence of any default under Section 3 of that certain
Subscription and Option Agreement dated October 21, 1996 by and between GEM and
the Company.
Unless terminated sooner by the unanimous agreement in writing of the
Company and the Shareholders then remaining, this Agreement shall terminate upon
the occurrence of any of the following events:
(i) Cessation of the Company's business.
(ii) Liquidation and/or dissolution of the Company.
(iii) Upon all of the Shares being held by a single
Shareholder.
(iv) When GEM no longer owns at least ten percent (10%) of
the outstanding shares of capital stock in the
Company.
(v) On April 21, 1998, provided, however, that in the
event GEM fails to timely exercise its option under
that certain Subscription and Option Agreement, dated
October 21, 1996 by and between GEM and the Company,
this Agreement will terminate.
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A copy of the Shareholders and Voting Agreement, in its entirety, is
available for review, by any qualified shareholder at the Corporation's offices
during normal business hours.
ELECTION OF DIRECTORS
---------------------
The Board of Directors is divided into three classes with terms
expiring on three successive Annual Meeting Dates. At the Annual Meeting to be
held in March 24, 1997, the following persons, Abel Sheng and John M. Young, are
nominees of the Board for election as directors for three-year terms expiring in
2000. It is intended that the Proxies solicited by and on behalf of the Board of
Directors will be voted for the election of the nominees; provided however, that
in the event of the death or ineligibility, inability or unwillingness to serve
of either nominee, the Proxies will be voted according to the judgment of the
persons named therein. The Board has no reasons to believe that either nominee
would be ineligible, unable or unwilling to serve if elected.
Listed below are the names and ages of the nominees and all other
Directors, all positions and offices held by each person and the period or
periods during which he has served in such positions and offices. The nominees
are now directors; Mr. Young was elected to his present term of office at the
Annual Meeting of Shareholders held March 31, 1994; Mr. Sheng was appointed to
the Board of Directors, effective December 9, 1996, by a majority vote of the
Board of Directors. Mr. Sheng previously served as a Director from 1991 to 1994.
The By-Laws of the Corporation provide for a Board of Directors consisting of a
maximum of seven members. The candidacy of neither of the nominees is the
subject of any arrangement or understanding between either nominee and any other
person or persons, except the Directors and officers of the Corporation acting
solely in that capacity. Neither of the nominees is related to any other
director or to any executive officer by blood, marriage or adoption.
<TABLE>
<CAPTION>
POSITION WITH ISSUER
NAME AGE AND PRINCIPAL OCCUPATION PERIOD AS DIRECTOR
- ------------------------------------------------------------------------------------------------------------
NOMINEES FOR ELECTION WITH TERMS EXPIRING IN 2000:
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
John M. Young 79 Director; retired Vice President and 1947 - Present
Operations Manager of the Corporation
Abel Sheng 56 Director; President, Raamco 1996 - Present
International, Inc. and Sidco 1991 - 1994
Investments, Inc., investment companies
</TABLE>
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<TABLE>
<CAPTION>
POSITION WITH ISSUER
NAME AGE AND PRINCIPAL OCCUPATION PERIOD AS DIRECTOR
- ------------------------------------------------------------------------------------------------------------
DIRECTORS WITH TERMS EXPIRING IN 1999:
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Otto H. York 86 Director, Chairman of the Board, and 1969 - Present
Acting President and CEO; President,
York Resources, Inc.
Daniel Auzan 53 Director, President Directeur General, 1996 - Present
General de Mesure et de Maintenance
Electronique, S.A.
Victor Tolan 43 Vice President Sales and Marketing, 1996 - Present
Metrix U.S.A.
DIRECTORS WITH TERMS EXPIRING IN 1998:
- ------------------------------------------------------------------------------------------------------------
Ronald T. DeBlis 72 Director; retired Dun & Bradstreet 1981 - Present
Jack Frucht 82 Director; retired Chairman of the Board 1947 - Present
and CEO of the Corporation
</TABLE>
No Director is or, within the last five years, has been employed by any
parent, subsidiary or affiliate of the Company.
During the past fiscal year, there were a total of seven meetings of
the Board of Directors. No Director attended fewer than 75 percent of such
meetings, during the period for which he was a Director.
The Proxies solicited by this Proxy Statement can be voted only for the
nominees named above, except in the event of occurrences previously discussed
herein.
COMPENSATION OF DIRECTORS AND OFFICERS
--------------------------------------
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG-TERM
NAME AND ANNUAL COMPENSATION COMPENSATION ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS OTHER AWARDS COMPENSATION
- ------------------ ---- --------------------------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Ronald T. DeBlis 1996 N/A N/A N/A N/A N/A
President & CEO
Otto H. York 1996 N/A N/A N/A N/A N/A
President & CEO
Holmes Bailey 1996 $ 72,962 N/A N/A N/A $32,308
President & CEO
Holmes Bailey 1995 $140,000 N/A N/A N/A $13,124
President & CEO
Holmes Bailey 1994 $ 57,948 $30,000 N/A N/A $17,624
President & CEO
</TABLE>
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Pre-requisites and other personal benefits, securities or property
conveyed to each officer did not exceed either $50,000 or 10% of such executives
salary and bonus. Effective March 31, 1996, Mr. Bailey's employment agreement
was not renewed and under the terms of his contract he was paid $32, 308 of
severance pay.
Those Directors of the Company who are not salaried officers (Messrs.
Auzan, DeBlis, Frucht, Tolan, York and Young) are paid Directors' fees at the
rate of $10,000 per year, in quarterly installments, plus $500 per scheduled
meeting of the Board or any committee. The Board has, by resolution, agreed to
be paid fifty percent (50%) of their fees for fiscal year 1997 and 1996
respectively.
As approved by the Corporation's stockholders at the 1987 annual
meeting, the Corporation's 1987 Incentive Stock Option Plan provided for the
granting of tax-qualified stock options to key employees for up to 75,000 shares
of the Corporation's Common Stock. No shares remain available for future option
grants under the Plan. On November 15, 1994 the Board of Directors authorized
the grant of options to purchase 55,000 shares to officers and other key
employees, and as they relate to officers, they have been included in the Voting
Securities section of this Proxy Statement. The Plan is administered by the
Board of Directors, which selects participants. Under the Plan, incentive stock
options must be granted at 100% of the fair market value of the Common Stock on
the date of grant and may not be granted to any employee who owns more than 10%
of the Corporation's Common Stock nor for a term exceeding five years. Options
under the Plan are not transferable and are subject to adjustment in the event
of a stock dividend, stock split, reorganization or any other change in the
corporate structure or shares of the Corporation. On November 15, 1994 options
to purchase 12,500 shares were granted to all executive officers as a group. The
per share exercise price for all outstanding options is $1.0625.
As approved by the Corporation's stockholders at the 1987 annual
meeting, the Corporation's Stock Option Program for Non-Employee Directors
provided for the grant of non-qualified stock options to non-employee directors
for up to 37,500 shares of the Corporation's Common Stock. No shares remain
available for future option grants under the Plan..
INDEPENDENT PUBLIC ACCOUNTANTS AND RELATED MATTERS
--------------------------------------------------
I. Weismann Associates, Certified Public Accountants, has been engaged
by the Corporation as its independent public accountant. A representative from
I. Weismann Associates is expected to be present at the Annual Meeting of
Stockholders with the opportunity to make a statement if so desired and to be
available to respond to appropriate questions.
COMMITTEES
----------
The Board of Directors has a standing audit committee consisting of
Messrs. Auzan, DeBlis and York. The last meeting of the audit committee was held
June 25, 1996 to discuss the Corporation's audit for the fiscal year ending
September 30, 1996 and to discuss other matters relating to the Corporation's
accounting, financial reporting and auditing functions.
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The Board of Directors has a standing compensation committee consisting
of Messrs. Auzan, DeBlis, and York. The last meeting of the compensation
committee was held December 9, 1996.
The Board of Directors has a standing budget committee consisting of
Messrs. Auzan, DeBlis and York. The last meeting of the budget committee was
held December 9, 1996.
The Board of Directors has a standing environmental committee
consisting of Messrs. Auzan, DeBlis and York. The last meeting of the
environmental committee was December 9, 1996.
DATE FOR RECEIPT OF STOCKHOLDER PROPOSALS
-----------------------------------------
Proposals from stockholders must be received by the Corporation by
October 31, 1997 for inclusion in the proxy relating to the annual meeting to be
held in 1998.
PURPOSES OF MEETING AND OTHER MATTERS
-------------------------------------
The meeting is called to elect two Directors and to transact such other
business as may properly come before the meeting.
As of the date of this Proxy Statement, the Board does not know of any
business, other than the election of Directors, to come before the meeting, but
if any business does lawfully come before the meeting, it is the intention of
the persons named in the enclosed Proxy to vote in regard thereto in accordance
with their best judgment.
A copy of the Annual Report for the year ended September 30, 1996 is
enclosed herewith. The Annual Report is not regarded as proxy soliciting
material.
BOONTON ELECTRONICS CORPORATION
By /s/ John E. Titterton
----------------------
John E. Titterton
Secretary
Township of Hanover, New Jersey
February 28, 1996
