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
BOWLES FLUIDICS CORPORATION
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
( ) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
( ) $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
BOWLES FLUIDICS CORPORATION
NOTICE AND PROXY STATEMENT
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON
MARCH 14, 1996
TO THE STOCKHOLDERS:
Notice is hereby given to the Stockholders that the Annual Meeting of
Stockholders of BOWLES FLUIDICS CORPORATION will be held on the 14th day of
March 1996 at 9:30 o'clock in the forenoon, local time, at 6625 Dobbin Road,
Columbia, Maryland 21045.
The Annual Meeting will be held for the purpose of electing six
directors to hold office until the next annual election of directors or until
their successors are appointed, ratifying the directors' selection of Coopers &
Lybrand L.L.P. to be the Corporation's independent public accountants for the
ensuing year, and transacting such other business as may properly be brought
before the meeting.
The record of Stockholders entitled to vote at said meeting was taken at
the close of business February 1, 1996.
Stockholders are requested to specify their choice, sign, date and
return the enclosed Proxy in the enclosed envelope, postage for which has been
provided. Prompt response will be appreciated.
BY THE ORDER OF THE BOARD OF DIRECTORS
Eleanor M. Kupris, Secretary
Columbia, Maryland
February 14, 1996
<PAGE>
BOWLES FLUIDICS CORPORATION
PROXY STATEMENT
THE ACCOMPANYING PROXY IS SOLICITED BY THE MANAGEMENT OF
BOWLES FLUIDICS CORPORATION
This Proxy Statement is furnished by mail to the stockholders by the
management of Bowles Fluidics Corporation ("the Company") on whose behalf this
solicitation of proxies is being made for use at the Annual Meeting of
Stockholders to be held at 9:30 a.m., local time, on Thursday, March 14, 1996,
at the Company's offices, 6625 Dobbin Road, Columbia, Maryland 21045. This Proxy
Statement is being mailed on or about February 14, 1996, to all of the Company's
stockholders of record at the close of business on February 1, 1996, the "Record
Date."
THE EXPENSE OF THIS SOLICITATION WILL BE BORNE BY THE COMPANY.
The Proxy is revocable upon your written notice to the Secretary of the
Company at any time prior to the exercise of the authority granted thereby, and
it shall be suspended if you are present at the meeting and elect to vote in
person.
On the Record Date for voting at the meeting, the Company had outstanding
12,610,011 shares of Common Stock, par value $0.10, and 933,080 shares of voting
8% Convertible Preferred Stock, par value $1.00. Each share of Preferred Stock
is convertible into four shares of Common Stock at any time by the Preferred
Stockholder and at the option of the Company ten years after the date of
original issue if the dividends are current. The Company also had outstanding on
the Record Date incentive stock options for 180,000 shares. The Company has
never paid a dividend on the Common Stock. An $0.08/share dividend was paid on
the Preferred Stock under its indenture for fiscal years 1986, 1987, 1988, 1989,
and 1992. A Preferred Stock dividend related to the Company's earnings for
fiscal years 1989 and 1992, aggregating $94,640, was paid on March 19, 1993, and
dividends related to earnings in 1993, 1994, and 1995 in the amounts of $74,646
were paid to the holders of Preferred Stock on December 15 in each of 1993,
1994, and 1995.
The holders of Common Stock of record at the close of business on the
Record Date fixed by the Board of Directors pursuant to the By-Laws will be
entitled to one vote per share, for a total of 12,610,011 votes, and the holders
of the Preferred Stock of record on the same day will be entitled to four votes
per share, or 3,732,320 votes, for an aggregate of 16,342,331 votes on all
business of the meeting including election of directors. Owners of the Common
and Preferred Stock have cumulative voting rights so that all of the votes of a
stockholder may be accumulated for all directors' positions and voted for a
single candidate or allocated amongst directors in the stockholder's discretion.
The presence in person or by proxy of the stockholders entitled to cast a
majority of all of the votes entitled to be cast at the meeting shall constitute
a quorum for the transaction of business at the meeting. Election of directors
and appointment of auditors require only a simple majority of the votes cast.
<PAGE>
PROPOSALS OF SECURITY HOLDERS
Proposals of security holders intended to be presented at the next annual
meeting must be received by Bowles Fluidics Corporation at its executive offices
not less than 120 calendar days in advance of the date the Proxy Statement is to
be released to security holders in connection with the previous year's annual
meeting.
In order to qualify for inclusion of a person's proposal in a Proxy
Statement, such person must be the beneficial owner of at least 1% or $1,000.00
in market value of the securities entitled to be voted at the meeting and must
have held the securities for at least one year prior to the date of the meeting.
BENEFICIAL OWNERSHIP
The following table reflects the names of the only persons known to the
Company to be the beneficial owners of 5% or more of the Common and Preferred
Stock outstanding on the Record Date.
<TABLE>
<CAPTION>
- ------------------------------ -------------------------- --------------------------
Direct and Percentage
Name Beneficial Ownership
-------------------------- --------------------------
------------- ------------ ------------- ------------
Common Preferred Common Preferred
- ------------------------------ ------------- ------------ ------------- ------------
- ------------------------------ ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C>
William Ewing, Jr.* 2,136,087 240,831 16.9 25.8
- ------------------------------ ------------- ------------ ------------- ------------
- ------------------------------ ------------- ------------ ------------- ------------
Estate of Arthur O. Choate 1,176,849 28,509 9.3 3.1
- ------------------------------ ------------- ------------ ------------- ------------
</TABLE>
*Mr. Ewing is a "control person" as that term is applied pursuant to the
securities laws.
MANAGEMENT IS PROVIDING WITH THIS PROXY STATEMENT, WITHOUT CHARGE TO
EACH PERSON WHOSE PROXY IS SOLICITED, A COPY OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND THE
SCHEDULES THERETO REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION.
The directors to be elected at the forthcoming meeting for which proxies
are being solicited will serve for the current fiscal year or until their
successors are elected. The management of the Company knows of no reason why the
nominees for election as directors would not be able to serve.
The Board of Directors has authorized the management of the Company to
solicit proxies for the forthcoming meeting and, in connection therewith, has
designated Eleanor M. Kupris and Howard L. Rose as Proxies and directed the
Secretary of the Company to prepare a formal Proxy
2
<PAGE>
upon which the shareholders may indicate their concurrence or objection to the
election of directors named herein and other matters set forth in the Proxy and
in this Proxy Statement. Unless otherwise directed in the Proxy, the persons
named in the Proxy will vote FOR the six directors nominated by management, will
vote FOR the approval of Coopers & Lybrand L.L.P. as the Company's independent
public accountants, and will vote in accordance with their best judgment on
other matters which may come before the meeting.
The Board of Directors met five times in fiscal year 1995. All meetings
were attended by all directors except one director at two meetings.
The Board has established Audit and Compensation Committees but not a
Nominating Committee.
The Audit Committee is composed of William Ewing III and Julian Lazrus. The
Committee met twice to review the financial statements of the Company and confer
with the Company's auditors. The Committee issued no written reports but
reported to the Board orally.
The Compensation Committee is composed of William Ewing, Jr., John E.
Searle, Jr., and Ronald D. Stouffer. The Committee met twice to review the
financial status of the Company and to consider employees' compensation in the
light thereof. Its reports to the Board were rendered orally.
All of the nominees have been directors of the Company for at least five
years or were discussed in a prior year's Proxy Statement.
The table on page 3 sets forth the holdings of Common and Preferred Stock
of each director on the Record Date and of all officers and directors as a
group.
For additional information on officers, see pages 31 and 32 of the enclosed
SEC Form 10-K.
3
<PAGE>
<TABLE>
<CAPTION>
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
Shares of Common Percentage of
Year Became and Preferred Stock Outstanding Shares
Principal Director Owned Directly and of Stock
Nominee Occupation Continuously1 Beneficially Owned Directly
(as of 2/1/96) and Beneficially
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
<S> <C> <C> <C> <C>
William Ewing, Jr.4 Chairman of Board of COMMON:
(age 83) Bowles Fluidics 1962 Direct 144,180 1.14%
Corporation since 1975 Beneficial 1,991,907 15.82%
PREFERRED:
Direct 50,054 5.40%
Beneficial 190,777 20.40%
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
Julian Lazrus5 Vice Chairman of the Board
(age 76) of Bowles Fluidics 1969 COMMON 48,938 .39%
Corporation since 1994; PREFERRED 5,701 .60%
President from 1973 to
1994; Chief Financial
Officer from 1989 to 1994
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
Ronald D. Stouffer6 President of Bowles
(age 64) Fluidics Corporation since 1978 COMMON 89,431 .71%
1994; Executive Vice
President from 1982 to 1994
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
William Ewing III3 Co-Trustee of Ewing
(age 49) family trusts; Vice 1985 COMMON 29,300 .23%
President and Treasurer of
Reeves Industries, Inc.
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
John E. Searle, Jr.2 Retired; formerly Vice
(age 71) President of TRW, Inc., 1987 COMMON 20,000 .16%
Fasteners Division
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
David C. Dressler8 Retired; formerly
(age 67) President and Vice 1993 COMMON 20,000 .16%
President of various
subsidiaries of the Martin
Marietta Corporation
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
ALL DIRECTORS AND COMMON:
OFFICERS AS A GROUP7 Direct 368,389 2.9%
(13) Beneficial 1,991,907 15.8%
PREFERRED:
Direct 55,755 6.0%
Beneficial 190,777 20.4%
- ---------------------- ---------------------------- ----------------- -------------------------- ----------------------
</TABLE>
4
<PAGE>
1 All directors' terms expire in 1996 and all directors are standing for
approximately one-year terms expiring in 1997.
2 Mr. Searle was elected to the Board of Directors on June 4, 1987.
3 William Ewing III was elected to the Board of Directors on October 30, 1985,
and is the son of William Ewing, Jr. William Ewing III and one of his
brothers are the trustees of 373,240 shares of Common Stock under various
trusts for 14 grandchildren of William Ewing, Jr. William Ewing III disclaims
beneficial ownership of such shares, and they are not included in the table
on page 3.
4 Mr. and Mrs. Ewing, Jr., as a result of their personal holdings,
trusteeships, and powers of attorney from other members of their families,
have effective voting control over approximately 79.6% of the number of votes
entitled to be cast at the Annual Meeting of Stockholders. However, Mr. Ewing
disclaims beneficial ownership of 7,318,625 shares of Common Stock (1) owned
by his wife, Mary C. Ewing, (2) held in trusts for members of his family and
of which he is trustee, and (3) owned by his adult children and nieces and
nephews and for which Mr. Ewing holds powers of attorney. As to Preferred
Stock, Mr. Ewing disclaims beneficial ownership of 636,111 shares either
owned by his wife or controlled via trusteeships and powers of attorney. The
above number of shares do not appear in the table on page 3. Mr. Ewing is a
director of Vacuum Instruments Corporation and Actronics, Inc., both
non-public companies.
5 Mr. Lazrus holds incentive stock options to purchase 20,000 shares of Common
Stock at $0.65 per share and 60,000 shares at $0.15 per share.
6 Mr. Stouffer holds incentive stock options to purchase 40,000 shares of
Common Stock at $0.15 per share.
7 Directors and officers as a group have incentive options on a total of
180,000 shares of Common Stock, par value $0.10 per share. Incentive options
for 50,000 shares are exercisable at $0.65 per share; 130,000 shares are
exercisable at $0.15 per share.
8 Mr. Dressler was elected to the Board at a meeting of the Board held on June
23, 1993. In 1995 Mr. Dressler exercised a non-incentive option to purchase
20,000 shares of Common Stock at $0.65 per share.
5
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
===========================================================================================================================
(a) (b) (c) (d) (e) (g) (i)
Long-Term
Annual Compensation Compensation,
Awards
===========================================================================================================================
Name and Principal Fiscal Salary Bonus Other Annual Options All Other
Position Year ($) ($) Compensation ($) (#) Compensation ($)
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Ronald D. Stouffer 1995 138,008 28,568 7,431 -0- 5,309
President 1994 127,499 31,578 13,709 -0- 4,405
1993 112,019 21,990 14,739 -0- 2,651
===========================================================================================================================
Richard W. Hess 1995 108,014 22,359 -0- -0- 3,520
Vice President, Engineering 1994 99,814 26,315 1,466 -0- 2,553
1993 95,014 15,000 29,706 30,000 -0-
===========================================================================================================================
David A. Quinn 1995 98,010 20,288 -0- -0- 3,912
Vice President, Finance 1994 90,002 23,684 6,659 -0- 328
===========================================================================================================================
</TABLE>
The Company has no long-term incentive plan, except for the stock option
plans described hereinafter, and does not have a pension plan wherein
benefits are determined by compensation and years of service. The Company
does have a 401(k) plan to which the Company makes a contribution of 50% of
the employee's contribution to a maximum of 6% of the employee's earnings
subject to IRS limitations. The Company has no executive officer employment
contracts except for Julian Lazrus, former President of the Company and now
Vice Chairman of the Board of Directors.
COMPENSATION OF DIRECTORS
Each outside director (Messrs. Ewing, Jr., Ewing III, Searle, and Dressler)
receives $2,000 per year for serving on the Board plus $250 for each meeting
attended. In addition, three directors were compensated for travel, the
aggregate being approximately $7,000.
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Individual Grants: None
TRANSACTIONS INVOLVING DIRECTORS AND OFFICERS
A dividend aggregating $94,640 was paid on March 16, 1993, on the Preferred
Stock. This dividend related to the Company's earnings for fiscal years 1989 and
1992. Dividends of $0.08 per share on the Preferred Stock, related to earnings
for fiscal years 1993, 1994, and 1995, were declared on November 16, 1993,
November 9, 1994, and November 15, 1995, respectively, and paid on December 15
in the years 1993, 1994, and 1995.
On December 30, 1991, William Ewing, Jr., as trustee of a trust of which he
is the beneficiary, purchased 62,500 shares of the Company's authorized but
unissued $1.00 par value 8% Convertible Preferred Stock at a price of $1.00 per
share. Mr. Ewing also purchased an additional 187,500 shares of such stock at
$1.00 per share for various trusts for members of his family for which he is
also trustee. Mr. Ewing received $19,266 in each of 1993, 1994, and 1995 in the
form of dividends on his holdings, both direct and beneficial, of Preferred
Stock of the Company.
On December 28, 1994, William Ewing, Jr., transferred 373,240 shares of
Common Stock to his son and director, William Ewing III, and his son, Frederic
Ewing II, as trustees of various trusts for 14 of his grandchildren, and
transferred another 213,280 shares to his children, including 26,660 to William
Ewing III, for an aggregate 586,520 shares.
In 1995, Mr. Dressler exercised a non-incentive option for 20,000 shares of
the Company's Common Stock at $0.65 per share.
LEGAL PROCEEDINGS
For discussion of legal proceedings involving the Company, see Item 3 on
page 6 of the enclosed Form 10-K Report to the Securities and Exchange
Commission.
OTHER SIGNIFICANT EVENTS
The Company undertook a quasi-reorganization effective October 29, 1994,
pursuant to which the retained earnings deficit was eliminated by an adjustment
to additional paid-in capital; see Note 5 on page 26 of the enclosed Form 10-K
Report to the Securities and Exchange Commission.
7
<PAGE>
The Company recently formed a wholly owned subsidiary in the State of
Delaware to which the Company has transferred its U.S. and Canadian patents and
patent applications together with operating capital. The Company was granted an
exclusive license under said patents and patent applications in return for
specified royalties.
STOCK OPTIONS
An Employee Incentive Stock Option Plan, under which 300,000 shares were
allocated, was adopted by the Board of Directors on May 19, 1992. As of the same
date, options at $0.15 per share for six years were granted as follows: Julian
Lazrus, 60,000 shares; Ronald D. Stouffer, 40,000 shares; Eleanor M. Kupris,
30,000 shares; and a former officer, 30,000 shares. During 1993, Mr. Lazrus was
granted an option on 20,000 shares of Common Stock at $0.65 per share, and
Richard Hess, Vice President, Engineering, was granted an option on 30,000
shares at $0.65 per share. An option on 30,000 shares at $0.15 was exercised by
a former officer in January 1994. Options on 130,000 shares at $0.15 per share
and both options at $0.65 per share remain outstanding, for a total of 180,000
shares.
For income tax purposes, no income is recognized by the employee under the
Employee Incentive Stock Option Plan at the time of grant or exercise of the
option. However, in the year the recipient exercises the option, or his/her
rights in the option become transferable or no longer subject to a substantial
risk of forfeiture, an alternative minimum tax adjustment for the recipient
occurs to the extent the fair market value of the option exceeds the option
price. A gain is recognized upon the sale of the stock and taxed at ordinary
income or capital gains rates dependent upon the holding period of the option or
stock. Assuming the recipient holds the option for the required holding period,
there are no tax consequences for the Company at the time of grant or exercise
of the option.
On May 19, 1992, Mr. Searle, a director, was granted a non-incentive option
on 20,000 shares of Common Stock at $0.15 per share, the Asked price on the
over-the-counter market on the date of grant. This option has been exercised in
full.
On September 10, 1993, Mr. Dressler, a director, was granted a
non-incentive stock option for five years on 20,000 shares at $0.65 per share,
the average of the Bid and Asked prices on the date of grant. This option was
exercised on August 30, 1995.
Generally, for other than the Employee Incentive Stock Option Plan, a
taxable event occurs on the date of grant of an option for both the Company and
the recipient of the option, to the extent the fair market value exceeds the
option price on that date. For income tax purposes, as the Company's stock or
options are not actively traded on an established market, a readily
ascertainable fair market value cannot be determined. As such, no income to the
recipient or corresponding compensation expense for the Company is recognized
for income tax purposes at the date of grant, but is recognized for tax purposes
at the time of exercise to the extent that the value of stock purchased exceeds
the amounts paid for the stock. In addition, a gain or loss would be recognized
to the recipient at the time of the sale of the stock.
8
<PAGE>
APPROVAL OF AUDITOR
The accounting firm of Coopers & Lybrand L.L.P. is recommended to
stockholders as the Company's independent public accountants for the current
year. A representative of Coopers & Lybrand L.L.P. will attend the Annual
Meeting of Stockholders and be available to answer appropriate questions from
the stockholders. It is not expected such representative will make a statement
at the meeting.
OTHER BUSINESS
Other than a request for approval of the minutes of last year's Annual
Meeting, management does not intend to present any business for action at the
meeting other than discussed herein and does not know of any other business
intended to be presented by others.
ANNUAL REPORT AND FINANCIAL INFORMATION
A copy of the President's letter dated February 14, 1996, and a copy of the
Company's Form 10-K which includes financial statements for its fiscal year
ended October 28, 1995, are being mailed with this Proxy Statement on February
14, 1996, to each shareholder of record as of February 1, 1996.
----------------------------
Eleanor M. Kupris, Secretary
Columbia, Maryland
February 14, 1996
9
<PAGE>
PROXY
BOWLES FLUIDICS CORPORATION
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
MARCH 14, 1996
The undersigned hereby appoints Eleanor M. Kupris and Howard L. Rose,
jointly and severally, Proxies, with full power of substitution, to vote as
designated below all shares of Common and/or Preferred Stock which the
undersigned is entitled to vote for the election of directors and on all other
matters which may come before the 1996 Annual Meeting of Stockholders of Bowles
Fluidics Corporation to be held on March 14, 1996, or any adjournment thereof,
including any proposal omitted from this proxy and the Proxy Statement pursuant
to the Proxy rules of the Securities and Exchange Commission. The meeting will
begin at 9:30 a.m., local time, at the Company's offices, 6625 Dobbin Road,
Columbia, Maryland 21045.
1. ELECTION OF DIRECTORS:
[] FOR all nominees listed below [] WITHHOLD AUTHORITY to
(except as marked to the vote for all nominees listed
contrary below) below
(INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through the nominee's name in the list below.)
DAVID C. DRESSLER WILLIAM EWING, JR. WILLIAM EWING, III
JULIAN LAZRUS JOHN E. SEARLE, JR. RONALD D. STOUFFER
2. APPROVE SELECTION OF COOPERS & LYBRAND L.L.P. as the independent public
accountants of the Company.
[] FOR [] AGAINST [] ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS SPECIFIED, BUT IF NOT
OTHERWISE MARKED, THEY WILL BE VOTED "FOR" THE ABOVE ITEMS.
Please sign exactly as your name or names appear below. When signing as
executor, administrator, attorney, trustee or guardian, please give your full
title as such. Corporations are requested to affix seals.
_____________________________________(SEAL)
Signature of Stockholder
-------------------------------------------
-------------------------------------------
Dated _____________________________________
(Please sign, date and
return this Proxy in the
enclosed envelope.)
