FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[ X ]ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1996
OR
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition perio to
Commission file number 0-6933
CAMBEX CORPORATION
(Exact name of registrant as specified in its charter)
Massachusetts 04 244 2959
(State or other (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or
organization)
360 Second Avenue 02154
Waltham, Massachusetts (Zip Code)
(Address of principal
executive offices)
Registrant's telephone number, including area code: 617-890-6000
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.10 par value
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
An Exhibit Index setting forth the exhibits filed herewith or incorporated by
reference herein is included herein at Page A-1.
The aggregate market value of the voting stock held by non-affiliates of
Cambex Corporation as of March 27, 1997 was $10,256,577, based on the closing
price of the common stock on the Nasdaq National Market reporting system on
that date.
The number of shares of Cambex Corporation's common stock outstanding as of
March 27, 1997: 9,080,683.
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PART III
Item 11. Executive Compensation
The following table provides certain summary information concerning
compensation paid or accrued by the Company to or on behalf of the Company's
Chief Executive Officer and each of the other executive officers of the
Company (determined as of the end of the last fiscal year) for the fiscal
years ended December 31, 1996, August 31, 1995 and August 31, 1994.
Summary Compensation Table
Annual Compensation
Commissions
and Incentive
Name and Position Year Salary Bonuses
Joseph F. Kruy 1996 $200,000 $ -
Chairman, President and CEO 1995 $195,385 $ 8,962
1994 $180,000 $46,810
Sheldon M. Schenkler 1996 $110,000 $ -
Vice President of Finance and 1995 $110,000 $ 1,680
Chief Financial Officer 1994 $106,731 $ 8,777
Long Term Compensation Awards
All Other
Options Compensation (1)
Name and Position Year (#)
Joseph F. Kruy 1996 - $3,854
Chairman, President and CEO 1995 - $2,250
1994 - $4,943
Sheldon M. Schenkler 1996 10,000 $3,237
Vice President of Finance and 1995 - $1,832
Chief Financial Officer 1994 5,000 $3,828
(1) Company contribution in Company Common Stock on officer's behalf to
the Company's 401(k) Plan.
Directors who are not employed by the Company receive an annual fee of
$10,000 and a fee of $1,000 for each meeting of the Board attended.
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STOCK OPTIONS
The following table contains information concerning the grant of stock
options under the Company's 1987 Combination Stock Option Plan to the
executive officers named in the Summary Compensation Table.
Option Grants in Last Fiscal Year
Individual Grants
% of Total
Options Options Granted Exercise
Granted to Employees in Price Expiration
Name (#) Fiscal Year ($/share) Date
Joseph F. Kruy --- --- --- ---
Sheldon M. Schenkler 10,000 4.61 $5.10 3/4/2006
Potential Realizable
Value at Assumed Annual
Rates of Stock Price
Appreciation for Option
Name Term (1)
0% 5% 10%
Joseph F. Kruy -- -- --
Sheldon M.
Schenkler $9,000 $46,700 $104,600
(1) Amounts represent hypothetical gains that could be achieved for the
respective options if exercised at the end of the option term. These
gains are based on assumed rates of stock price appreciation of 5% and
10% compounded annually from the date the options were granted to their
expiration date. This table does not take into account any appreciation
in the price of the Common Stock to date. Actual gains, if any, on
stock option exercises will depend on the future performance of the
Common Stock and the date on which the options are exercised. The
Company does not necessarily agree that this procedure fairly values the
options involved.
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Aggregate Option Exercises in Last Fiscal Year
and Fiscal Year End Option Value
Number of
Options at
December 31, 1996
Shares Acquired Value Exercisable/
Name on Exercise (#) Realized Unexercisable
Joseph F. Kruy 65,788 $336,177 -
Sheldon M. Schenkler - - 25,100/15,000
Value of
Unexercised
In-the-money
Options at
December 31, 1996
(1)
Exercisable/
Name Unexercisable
Joseph F. Kruy -
Sheldon M. Schenkler 14,459/-
(1) The closing price of the Company's Common Stock on December 31, 1996 on
the Nasdaq National Market was $1.81. The numbers shown reflect the
value of options accumulated over all years of employment.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee is presently comprised of the Board of Directors.
Mr. Kruy, the Company Chairman of the Board of Directors, President and CEO,
participates as a member of the Board in compensation decisions, excluding
decisions regarding his own compensation.
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EMPLOYMENT CONTRACTS AND TERMINATION AGREEMENTS
Mr. Kruy is employed under an agreement which provides for his full-time
employment as Chairman of the Board of Directors, President and Chief
Executive Officer of the Company until December 31, 1998. Pursuant to an
employment agreement dated November 18, 1994, the Company has agreed to pay
Mr. Kruy minimum base compensation of $200,000 per year and an incentive bonus
pursuant to the Company's Incentive Bonus Plan in an amount equal to 4% of the
Company's pre-tax profit, as defined, beginning in fiscal year 1995 for each
fiscal year during the term of the agreement. If another person is given
either the title or the powers of Chief Executive Officer, Mr. Kruy will be
entitled to resign and continue to be paid his fixed and incentive
compensation, subject to mitigation, through December 31, 1998.
REPORT ON EXECUTIVE COMPENSATION
The Company has designed its compensation program to compensate employees,
including its executives, in a consistent manner to promote a cooperative
effort toward common goals of quality performance. Compensation is set at
levels which the Company believes will attract, motivate and retain employees
who can achieve these goals.
Compensation for the Company's executive officers consists of base salary,
bonus and stock options. Base salaries and stock options are approved by the
Compensation Committee presently comprised of the Board of Directors based
upon a review of the responsibilities of the officer as well as a review of
the base salaries and stock options of similar positions in other high
technology companies of comparable revenues.
The Company believes that a substantial portion of an employee's compensation
should be based on the performance of the Company. Therefore, the Company has
an Incentive Bonus Plan which provides for annual cash bonuses to certain key
employees of the Company based on the Company's operating results for the year
up to an aggregate maximum of 15% of the Company's pre-tax income. As of
December 31, 1996, approximately 10 employees were eligible to participate in
this plan. Of the executive officers, Messrs. Kruy and Schenkler were
participants in the plan in 1996. The amount of each individual bonus is
determined at the discretion of the Board of Directors.
The Company also has the Cambex Corporation Employee Stock Purchase Plan
which is an equity purchase plan designed to attract and retain employees who
can make significant contributions to the success of the Company.
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BOARD OF DIRECTORS
Joseph F. Kruy
Philip C. Hankins
C. V. Ramammorthy
Robert J. Spain
Item 12. Security Ownership of Certain Beneficial Owners and Management
(#)Shares of Common
Stock Beneficially
Owned as of Percent
Name December 31, 1996 of Class
Joseph F. Kruy 1,404,940 (1) 15.43%
Philip C. Hankins 106,358 1.17%
C.V. Ramamoorthy 99,156 1.09%
Robert Spain 0 0%
Sheldon M. Schenkler 10,900 (2) 0.11%
All directors and
executive officers
as a group
(5) persons 1,621,354 (3) 17.80%
(1) Includes 56,250 shares owned by Mr. Kruy as co-trustee for his wife and
children. Excludes 960,194 shares held by CyberFin Corporation, which
is owned by Mr. Kruy's son. Mr. Kruy disclaims any beneficial interest
in such shares.
(2) Excludes 25,100 shares as to which options are exercisable currently or
within 60 days, of which 10,100 are in-the-money options.
(3) Directors and officers have shared investment power with respect to
56,250 shares and sole voting power with respect to 1,565,104 shares.
Solely for the purpose of calculating the aggregate market value of voting
stock held by non-affiliates of the Company as set forth on the Cover Page, it
was assumed that only directors and executive officers on the calculation date
together with spouses and dependent children of such persons constituted
affiliates.
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SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
CAMBEX CORPORATION
By: /s/ Joseph F. Kruy
Joseph F. Kruy, President March 27, 1997
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the Company
and in the capacities indicated as of March 27, 1997.
By: /s/ Joseph F. Kruy
Joseph F. Kruy, Chairman of the Board, President and Director
(Principal Executive Officer)
By: /s/ Sheldon M. Schenkler
Sheldon M. Schenkler, Vice President of Finance
(Principal Financial and Accounting Officer)
By: /s/ Robert J. Spain
Robert J. Spain, Director
By: /s/ Philip C. Hankins
Philip C. Hankins, Director
By: /s/ C. V. Ramamoorthy
C. V. Ramamoorthy, Director
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