SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------
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:
[X] Preliminary Proxy Statement [ ] Confidential; for use
[ ] Definitive Proxy Statement of the Commission Only
[ ] Definitive Additional Materials (as permitted by Rule
[ ] Soliciting Material Pursuant to 14a-6(e)(2))
Rule 14a-11 or Rule 14a-12
CONOLOG CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Information Statement)
<PAGE>
CONOLOG CORPORATION
5 Columbia Road
Somerville, New Jersey 08876
- --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 17, 1999
- --------------------------------------------------------------------------------
To the Shareholders of
CONOLOG CORPORATION
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of CONOLOG
CORPORATION (the "Company"), a Delaware corporation, will be held at the offices
of Milberg Weiss Bershad Hynes & Lerach LLP, One Pennsylvania Plaza, New York,
New York 10119, on Thursday, June 17, 1999, at 5:00 p.m., local time, for the
following purposes:
1. To elect five directors to serve, subject to the provisions of the
By-laws, until the next Annual Meeting of Shareholders and until their
respective successors have been duly elected and qualified;
2. To consider and act upon a proposal to approve a certain Option
Agreement between the Company and CLOG LLC;
3. To consider and act upon a proposal to approve a certain Consulting
Agreement between the Company and The Nybor Group Inc.;
4. To consider and act upon a proposal to amend the Certificate of
Incorporation to change the par value of the common stock from $1.00
par value per share to $.01 par value per share.
5. To consider and act upon a proposal to approve the selection of
Rosenberg Rich Baker Berman & Company as the Company's independent
auditors for the 1999 fiscal year; and
6. To transact such other business as may properly come before the
meeting or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on April 29, 1999 as
the record date for the meeting and only holders of shares of record at that
time will be entitled to notice of and to vote at the Annual Meeting of
Shareholders or any adjournment or adjournments thereof.
By order of the Board of Directors.
ROBERT S. BENOU
President
Somerville, New Jersey
May 17, 1999
- --------------------------------------------------------------------------------
IMPORTANT
IF YOU CANNOT PERSONALLY ATTEND THE MEETING, IT IS
REQUESTED THAT YOU INDICATE YOUR VOTE ON THE ISSUES
INCLUDED ON THE ENCLOSED PROXY AND DATE, SIGN AND MAIL
IT IN THE ENCLOSED SELF-ADDRESSED ENVELOPE WHICH
REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES
- --------------------------------------------------------------------------------
<PAGE>
CONOLOG CORPORATION
5 Columbia Road
Somerville, New Jersey 08876
----------------------------
P R O X Y S T A T E M E N T
for
ANNUAL MEETING OF SHAREHOLDERS
to be held June 17, 1999
------------------------
May 17, 1999
The enclosed proxy is solicited by the Board of Directors of Conolog
Corporation, a Delaware corporation (the "Company") in connection with the
Annual Meeting of Shareholders to be held at the offices of Milberg Weiss
Bershad Hynes & Lerach LLP, One Pennsylvania Plaza, New York, New York 10119 on
Thursday, June 17, 1999, at 5:00 p.m., local time, and any adjournments thereof,
for the purposes set forth in the accompanying Notice of Meeting. Unless
instructed to the contrary on the proxy, it is the intention of the persons
named in the proxy to vote the proxies in favor of (i) the election as directors
of the nominees listed below to serve until the next Annual Meeting of
Shareholders, (ii) approval of the Option Agreement, (iii) approval of the
Consulting Agreement; (iv) the amendment to the Certificate of Incorporation;
and (v) the selection of Rosenberg Rich Baker Berman & Company as the Company's
independent auditors for the 1999 fiscal year. The record date with respect to
this solicitation is the close of business on April 29, 1999 and only
shareholders of record at that time will be entitled to vote at the meeting. The
principal executive office of the Company is 5 Columbia Road, Somerville, New
Jersey 08876, and its telephone number is (908) 722-8081. The shares represented
by all validly executed proxies received in time to be taken to the meeting and
not previously revoked will be voted at the meeting. This proxy may be revoked
by the shareholder at any time prior to its being voted. This proxy statement
and the accompanying proxy were mailed to you on or about May 17, 1999.
<PAGE>
OUTSTANDING SHARES
The number of outstanding shares entitled to vote at the meeting is
4,257,773 common shares, par value $1.00 per share, not including 8,813 common
shares held in treasury. Each common share is entitled to one vote. The presence
in person or by proxy at the Annual Meeting of the holders of a majority of such
shares shall constitute a quorum. There is no cumulative voting. Assuming the
presence of a quorum at the Annual Meeting, directors shall be elected by a
plurality of the votes cast and the affirmative vote of a majority of the common
shares present at the meeting and entitled to vote on each matter is required
for the approval of the Option Agreement, the Consulting Agreement and the
approval of the Company's auditors, Rosenberg Rich Baker Berman & Company, as
the Company's auditors for fiscal 1999. The affirmative vote of the holders of a
majority of the total outstanding common shares is necessary to approve the
amendment to the Certificate of Incorporation. Votes shall be counted by one or
more persons who shall serve as the inspectors of election. The inspectors of
election will canvas the shareholders present in person at the meeting, count
their votes and count the votes represented by proxies presented. Abstentions
and broker nonvotes are counted for purposes of determining the number of shares
represented at the meeting, but are deemed not to have voted on the proposal.
Broker nonvotes occur when a broker nominee (which has voted on one or more
matters at the meeting) does not vote on one or more other matters at the
meeting because it has not received instructions to so vote from the beneficial
owner and does not have discretionary authority to so vote.
ELECTION OF DIRECTORS
The five persons named below, all of whom are presently directors of the
Corporation, have been nominated for re-election to serve until the Annual
Meeting of Shareholders and until their respective successors have been elected
and qualified.
2
<PAGE>
<TABLE>
<CAPTION>
Positions with Number of Shares
Corporation and/or Date of Initial Beneficially Owned
Principal Election as a as of April 29, Percent of
Name (age) Occupation Director 1999 Class
- ---------- ------------------ --------------- ------------------ ----------
<S> <C> <C> <C> <C>
Robert S. Benou (64) President and Director 1968 260,000 6.1%
Arpad J. Havasy (61) Executive Vice 1968 50,000 1.2%
President, Secretary,
Treasurer and Director
Louis S. Massad (61) Director 1995 15,000 0.3%
Marc R. Benou (31) Vice President, 1995 30,000 0.7%
Assistant Secretary and
Director
Edward J. Rielly (31) Director 1998 -0- 0.0%
</TABLE>
Each officer holds office at the pleasure of the Board of Directors. The
Corporation has no "significant" employees other than the executive officers.
There are no arrangements or understandings pursuant to which either the
directors or officers was selected as such.
Robert S. Benou has served as President and a Director of the Corporation
since 1968. Mr. Benou is responsible for new product development and supervision
of sales and marketing. Mr. Benou is a graduate of Victoria College and holds a
BS degree from Kingston College, England and a BSEE from Newark College of
Engineering, in addition to industrial management courses at Newark College of
Engineering. Robert S. Benou is the father of Marc R. Benou.
Arpad J. Havasy has served as the Corporation's Executive Vice President
and Director since 1968 and is responsible for manufacturing of both components
and hardware operations. Mr. Havasy is a graduate of Electromos E's Gepeszeti
Technikum (Hungary) and the University of Budapest. In addition, Mr. Havasy has
attended courses at both Rutgers University and the American Management
Association. Mr. Havasy is on total disability.
3
<PAGE>
Louis S. Massad has been a Director of the Corporation since April 1995.
Mr. Massad has been Vice President, Chief Financial Officer and Director of
Computer Power Inc. since 1986. Mr. Massad holds a BS and MS degree from Cairo
University (Egypt) and an MBA from Long Island University, New York.
Marc R. Benou joined the Corporation in 1991 and is responsible for
material, purchasing and inventory control. In March 1995, he was elected as
Vice President, Assistant Secretary and a Director. Mr. Benou attended Lehigh
and High Point University and holds a BS degree in Psychology and a BS in
Business Administration and Management. Marc R. Benou is the son of Robert S.
Benou, the Corporation's President.
Edward J. Rielly has been a Director of the Corporation since January 1998.
Mr. Rielly is an Application Developer with Chubb & Son. From 1993 to 1998, Mr.
Rielly was an Application Developer with the United States Golf Association. Mr.
Rielly is a graduate of Lehigh University and holds a BS in Computer Science.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the fiscal year ended July 31, 1998, the Board of Directors held 4
meetings. All of the directors attended all of the meetings of the Board of
Directors.
The Company has an Audit Committee, which consists of Messrs. Marc Benou,
Massad and Rielly. The Audit Committee reviews the financial reporting and
internal controls of the Company and meets with appropriate financial personnel
of the Company, as well as its independent auditors, in connection with these
reviews. The Audit Committee also recommends to the Board the firm which is to
be presented to the shareholders for designation as independent auditors to
examine the corporate accounts of the Company for the current fiscal year.
The Corporation does not have a standing compensation or nominating
committee.
EXECUTIVE OFFICERS
The executive officers of the Corporation are Robert S. Benou, President,
Arpad J. Havasy, Executive Vice President, Secretary and Treasurer, Marc R.
Benou, Vice President and Assistant Secretary, information as to each of whom is
set forth above and Thomas R. Fogg, Vice President - Engineering. Mr. Fogg
joined the Company in 1976 as Chief Engineer responsible for analog and guidance
projects. Since 1986, when he became Vice President-Engineering, he led the
design team in the development of the Company's commercial products. Mr. Fogg
holds a BSEE degree from Lafayette College and a MSEE degree from Rutgers
University. Mr. Fogg is a fellow of the Institute of Electrical and Electronic
Engineers and has published articles on delay equalization and the use of
crystal resonators.
4
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth the cash compensation (consisting entirely
of salary) paid (or accrued for) by the Corporation to its President, the only
executive officer whose aggregate remuneration exceeded $100,000 in each of the
Corporation's last three fiscal years ended July 31, 1998, 1997 and 1996:
<TABLE>
<CAPTION>
Summary Compensation Table
--------------------------
Long-Term
Annual Compensation Compensation
--------------------------------------- ----------------
Other
Annual
Name and Principal Fiscal Compen-
Position Year-End Salary Bonus sation Awards Payout
- ------------------ -------- ------ ----- ------ ------ -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
All
Other
Restricted Options/ LTIP Compen-
Stock Awards SARS Payouts sation
------------ ---- ------- ------
Robert Benou, 1998 $170,000
President 1997 $150,000
1996 $150,000
</TABLE>
INCENTIVE STOCK OPTION PLAN
On May 15, 1995, the Board of Directors of the Company adopted, and on
August 14, 1995 the shareholders approved, the Conolog Corporation 1995/1996
Stock Option Plan (the "Option Plan"). The Option Plan is designed to permit the
Company to grant either incentive stock options under Section 422A of the
Internal Revenue Code (the "Code") or nonqualified stock options. Under the
Option Plan, a Stock Option Committee (the "Option Committee") of the Board is
authorized to grant options to purchase up to 200,000 shares of stock to key
employees, officers, directors and consultants of the Company. The Option
Committee administers the Option Plan and designates the optionees, the type of
options to be granted (i.e., nonqualified or incentive stock options), the
number of shares subject to the options and the terms and conditions of each
option. The terms and conditions include the exercise price, date of grant and
date of exercise of each option. An employee may, at the discretion of the
Option Committee, be permitted to exercise an option and make payment by giving
a personal note.
5
<PAGE>
Incentive stock options may only be granted to employees of the Company and
not to directors or consultants who are not so employed. The exercise price for
incentive stock options must be at least one hundred percent (100%) of the fair
market value of the Common Stock as determined by the Option Committee on the
date of grant. All incentive stock options under the Option Plan must be granted
within ten (10) years from the date of adoption of the Option Plan and each
option must be exercised, if at all, within ten (10) years of the date of grant.
In no event may any employee be given incentive stock options whereby more than
$100,000 of options become exercisable for the first time in a single calendar
year. All incentive stock options must be exercised by an optionee within three
(3) months after termination of the optionee's employment, unless such
termination is as a result of death, disability or retirement. In the event an
optionee's employment is terminated as a result of death or disability, such
optionee or his designated beneficiary shall be entitled to exercise any and all
options for a period of twelve (12) months after such termination. If an
optionee's employment is terminated as a result of retirement, the optionee
shall be entitled to exercise his options for a period of twenty-four (24)
months following such termination.
Nonqualified stock options under the Option Plan are generally subject to
the same rules as discussed above. Nonqualified stock options may, however, also
be granted to directors and consultants, whether or not such individuals are
employees of the Company. The exercise price for nonqualified stock options may
not be granted at less than eighty-five percent (85%) of the fair market value
of the shares on the date of grant.
On November 4, 1998, the Board of Directors granted 105,000 options to
officers and employees of the Company at an exercise price of $.6875, the fair
market value on the date of grant.
EMPLOYMENT AGREEMENTS
The Company entered into a five-year employment agreement, commencing June
1, 1997 and ending May 31, 2002, with Robert S. Benou. Under his employment
agreement, Mr. Benou will receive an annual base salary of $150,000 for the
first year of employment with an increase of $20,000 beginning November 1997 and
every profitable year thereafter. In addition, Mr. Benou is entitled to an
annual bonus equal to 6% of the Company's annual "income before income tax
provision," as stated in its annual Form 10-K. The employment agreement also
entitled Mr. Benou to the use of an automobile and to employee benefit plans,
such as life, health, pension, profit sharing and other plans.
Under the employment agreement, employment terminates upon death or
disability of the employee and employee may be terminated by the Company for
cause. The Company intends to maintain a $1,000,000 life insurance policy on the
life of Robert S. Benou.
6
<PAGE>
The Company entered into a five-year employment agreement, commencing June
1, 1997 and ending May 31, 2002, with Marc R. Benou. Under his employment
agreement, Mr. Benou will receive an annual base salary of $55,000 for the first
year of employment, with an increase of $6,000 beginning November 1997 and every
year thereafter.
Mr. Benou is entitled to an annual bonus equal to 3% of the Company's
annual "income before income tax provision," as stated in its annual Form 10-K.
The employment agreement also entitles him to the use of an automobile and to
employee benefit plans, such as life, health, pension, profit sharing and other
plans. Under the employment agreement, employment terminates upon death or
disability of the employee and employee may be terminated by the Company for
cause.
COMPENSATION OF DIRECTORS
No director of the Corporation receives any cash compensation for his
services as such. Currently, the Corporation has two directors who are not
employees, Mr. Massad and Mr. Rielly.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The full Board of Directors made all decisions concerning executive
compensation during fiscal 1998. During fiscal 1998, no executive officers of
the Corporation served as a member of the compensation committee or board of
directors of another entity.
PRINCIPAL SHAREHOLDERS
The following table sets forth, as of April 29, 1999, certain information
concerning stock ownership of the Company by (i) each person who is known by the
Company to own beneficially more than 5% of the outstanding common shares of the
Company, (ii) each of the Company's directors and (iii) all current directors
and officers of the Company as a group. Except as otherwise indicated, all such
persons have both sole voting and investment power over the shares shown as
being beneficially owned by them.
Name and Address of Amount and Nature Percent
Beneficial Owner of Beneficial Ownership of Class
- ------------------- ----------------------- --------
Robert S. Benou (1) 260,000 6.1%
Arpad J. Havasy (1) 50,000 1.2%
Marc R. Benou (1) 45,000 0.7%
Louis Massad (1) 15,000 0.3%
Thomas Fogg (1) 12,000 0.3%
Edward J. Rielly (1) -0- 0.0%
7
<PAGE>
All Executive Officers 367,000 8.6%
and Directors as a Group
(6 Persons)
- ----------------
(1) The address for these individuals is c/o Conolog Corporation, 5 Columbia
Road, Somerville, New Jersey 08876.
CERTAIN TRANSACTIONS
The Company has adopted a policy that transactions with affiliated entities
or persons will be on terms no less favorable than could be obtained from
unrelated parties and that all transactions between the Company and its
officers, directors, principal shareholders and affiliates will be approved by a
majority of the Company's Board of Directors.
PROPOSAL TO APPROVE THE OPTION AGREEMENT
The Company and CLOG LLC have entered into an Option Agreement, dated as of
December 22, 1998, which was amended and restated as of May 5, 1999 (the "Option
Agreement"). Pursuant to the Option Agreement, the Company has granted an option
to CLOG to purchase convertible debentures of the Company having an aggregate
principal amount of up to $2,000,000. CLOG's option may be exercised at any time
prior to December 31, 1999, subject to shareholder approval of the Option
Agreement. The Option Agreement provides that the expiration date may be
extended by the Company.
Each convertible debenture is convertible into common stock of the Company
at a conversion rate of $1.00 per share, the fair market value of the common
stock on the date of the Option Agreement. If CLOG were to exercise its option
for all $2,000,000 of convertible debentures, it would have the right to convert
those notes into 2,000,000 shares of common stock (the "Conversion Shares"),
which would represent approximately 32% of the outstanding common stock of the
Company (without giving effect to the issuance of shares pursuant to the
Consulting Agreement discussed under "Proposal to Approve the Consulting
Agreement"). The Option Agreement provides that the voting power of any
Conversion Shares owned by CLOG will be voted in the same manner as shares voted
by all other shareholders of the Company. For example, if, of the votes cast on
a particular proposal, the other shareholders vote 60% for and 40% against the
proposal, CLOG will vote its Conversion Shares 60% for and 40% against the
proposal. This effectively nullifies CLOG's vote (other than to satisfy quorum
and minimum vote requirements) and permits the shareholders to maintain their
voting power.
Each convertible debenture will bear interest at the rate of 8% per annum
and will be due 12 months from the date such debenture is issued, subject to
acceleration under certain circumstances. At maturity, except with respect to
the initial $200,000 loaned, the Company will have the option to pay each
debenture, together with all accrued interest thereon, by issuing
8
<PAGE>
shares of a new Series C preferred stock having a value of $5.00 per share for
purposes of such repayment.
The Series C preferred will be non-voting and carry a cumulative dividend
of 8% per annum, which may be payable by the issuance of shares of common stock
valued at $5.00 per share. The Series C preferred will be convertible into
common stock at the rate of one share of common stock for each share of Series C
preferred and have a liquidating preference of $5.00 per share. The Series C
preferred may be redeemed by the Company at any time by paying $5.00 in cash
therefor.
The Option Agreement also provides that, for the one-year period commencing
on the issuance of any shares of Series C preferred (the "Registration Period")
CLOG may elect to include its Series C preferred in any post-effective amendment
to the Registration Statement discussed below or any new registration statement
under the Securities Act of 1933, as amended (the "Act"). In addition, the
Option Agreement also provides that, during the Registration Period, CLOG may
give notice to the Company to the effect that it desires to register its shares
under the Act for public distribution, in which case the Company will file a
post-effective amendment to a then current registration statement or a new
registration statement.
Pursuant to the Option Agreement, the Company filed a Registration
Statement with the Securities and Exchange Commission (the "Commission")
covering the resale of the 2,000,000 shares of common stock into which the
convertible debentures are convertible. Such Registration Statement was declared
effective by the Commission on April 12, 1999. The Company will take appropriate
measures to update the Registration Statement and the Prospectus to reflect the
results of the shareholder vote on this and the following proposal.
The managing member of CLOG, Warren Schreiber, also serves as President of
The Nybor Group, Inc. (see "Proposal to Approve the Consulting Agreement"
below).
The Board of Directors is recommending the approval of the Option
Agreement.
PROPOSAL TO APPROVE THE CONSULTING AGREEMENT
The Company and The Nybor Group Inc. have entered into a Consulting
Agreement, dated as of December 22, 1998, which was amended and restated as of
May 5, 1999 (the "Consulting Agreement"). Pursuant to the Consulting Agreement
(the effectiveness of which is subject to shareholder approval), Nybor has
agreed to provide the services of its President, Warren Schreiber, to the
Company for management consulting and financial consulting purposes through
December 31, 2004. Mr. Schreiber also serves as the managing member of CLOG LLC
(see "Proposal to Approve the Option Agreement"). As compensation, Nybor will
receive 1,057,143 shares of common stock (the "Consulting
9
<PAGE>
Shares"), which would represent 19.9% of the outstanding common stock of the
Company (without giving effect to the issuance of shares pursuant to the Option
Agreement discussed under "Proposed To Approve the Option Agreement").
Pursuant to the Consulting Agreement, the Consulting Shares are considered
earned in full immediately upon shareholder approval of the Consulting
Agreement. Therefore, none of the Consulting Shares are returnable by Nybor even
if it is unable to provide the consulting services called for under the
Consulting Agreement (as a result of, for example, the death or disability of
Mr. Schreiber).
The Consulting Agreement provides that the voting power of the Consulting
Shares owned by Nybor will be voted in the same manner as shares voted by the
other shareholders (as discussed above under "Proposal to Approve the Option
Agreement").
The Registration Statement discussed above under "Proposal to Approve the
Option Agreement" also covered the resale of the shares issuable pursuant to the
Consulting Agreement.
The Company has benefitted from prior consulting agreements it has had with
Warren Schreiber and the Board of Directors is recommending the approval of the
Consulting Agreement.
PROPOSAL TO AMEND CERTIFICATE OF INCORPORATION
There is being submitted to the shareholders for approval at the 1999
Annual Meeting a proposal to amend the Certificate of Incorporation to change
the par value of the Company's common stock from $1.00 par value per share to
$.01 par value per share.
Under the Delaware General Corporation Law, the Company cannot issue its
common stock for consideration which is less than the par value of the stock.
While the Company does not currently have plans to issue common stock for
consideration which is less than the current par value, changing the par value
from $1.00 to $.01 per share will provide the Company the flexibility to issue
shares for consideration which the Board of Directors deems appropriate at the
time of issuance. The Board of Directors is recommending the amendment to the
Certificate of Incorporation.
SELECTION OF AUDITORS
The Board of Directors recommends the selection of Rosenberg Rich Baker
Berman & Company as independent auditors to examine its financial statements for
the fiscal year ending July 31, 1998.
Representatives of Rosenberg Rich Baker Berman & Company are expected to be
present at the annual meeting of shareholders with the opportunity to make a
statement if they desire to do so and will be available to respond to
appropriate questions.
OTHER MATTERS
The Board of Directors does not know of any matters other than those
mentioned above to be presented to the meeting.
SHAREHOLDER PROPOSALS
Proposals by any shareholders intended to be presented at the next Annual
Meeting of Shareholders must be received by the Corporation for inclusion in
material relating to such meeting not later than January 14, 2000.
EXPENSES
All expenses in connection with solicitation of proxies will be borne by
the Company. Officers and regular employees of the Company may solicit proxies
by personal interview and telephone
10
<PAGE>
and telegraph. Brokerage houses, banks and other custodians, nominees and
fiduciaries will be reimbursed for out-of-pocket and reasonable expenses
incurred in forwarding proxies and proxy statements. Georgeson & Co. has been
engaged to assist in the solicitation of proxies, brokers, nominees, fiduciaries
and other custodians. The Company will pay that firm approximately $15,000 for
its services and reimburse its out-of-pocket expenses.
By Order of the Board of Directors,
Robert S. Benou
President
11
<PAGE>
Exhibit A
Certificate of Amendment
of
Certificate of Incorporation
of
Conolog Corporation
- --------------------------------------------------------------------------------
Under Section 242 of the
Delaware General Corporation Law
- --------------------------------------------------------------------------------
Conolog Corporation, a corporation organized and existing under the laws
of the State of Delaware (the "Corporation") hereby certifies as follows:
1. The Certificate of Incorporation of the Corporation is hereby amended
by changing the article thereof numbered fourth so that, as amended, said
Article FOURTH shall be and read as follows:
"FOURTH: The total number of shares of all classes of stock which the
Corporation is authorized to issue is twenty-two million (22,000,000) shares of
which two million (2,000,000) shares having a par value of $.50 per share are to
be classified as Preferred Stock and twenty million (20,000,000) shares, having
a par value of $.01 per share are to be classified as Common Stock.
Each one hundred (100) shares of the Corporation's Common Stock, par value
$.01 per share, issued and outstanding as of the close of business on August 17,
1995 shall be converted and reclassified into one (1) share of the Corporation's
Common Stock par value $1.00 per share, so that each share of the Corporation's
Common Stock, $.01 par value, issued and outstanding is hereby converted and
reclassified. No fractional interests resulting from such conversion shall be
issued, but in lieu thereof, the Corporation will pay cash for each currently
issued and outstanding share of Common Stock, par value $.01 per share,
representing such fractional interest at a price equal to the average of the
closing bid and ask prices of the Corporation's Common Stock as reported on the
OTC Bulletin Board on August 16, 1995."
2. The foregoing amendment has been duly adopted in accordance with the
provisions of Section 242 of the General Corporation law of the State of
Delaware by the vote of a majority of each class of outstanding stock of the
Corporation entitled to vote thereon.
<PAGE>
IN WITNESS WHEREOF, we have signed this Certificate this 17th day of June,
1999.
/S/
--------------------------
Robert S. Benou, President
ATTEST:
/S/
- --------------------------
Arpad J. Havasy, Secretary
<PAGE>
CONOLOG CORPORATION
PROXY
Annual Meeting of Shareholders - Thursday, June 17, 1999.
The undersigned shareholder of Conolog Corporation (the "Company") hereby
appoints Robert S. Benou the attorney and proxy of the undersigned, with full
power of substitution, to vote, as indicated herein, all the common shares of
the Company standing in the name of the undersigned at the close of business on
April 29, 1999 at the Annual Meeting of Shareholders of the Company to be held
at the offices of Milberg Weiss Bershad Hynes & Lerach LLP, One Pennsylvania
Plaza, New York, New York 10119 at 5:00 p.m., local time, on Thursday, June 17,
1999, and at any and all adjournments thereof, with all the powers the
undersigned would possess if then and there personally present and especially
(but without limiting the general authorization and power hereby given) to vote
as indicated on the proposals, as more fully described in the Proxy Statement
for the meeting.
(Please fill in the reverse side and return promptly in the enclosed envelope.)
<PAGE>
Please mark boxes |X| or |X| in blue or black ink.
1. Election of Directors.
FOR all nominees / /
WITHHOLD authority only for those nominees whose name(s) I have written
below / /
WITHHOLD authority for ALL nominees / /
Nominees for Directors are: Robert S. Benou
Arpad J. Havasy
Louis S. Massad
Marc R. Benou
Edward J. Rielly
- --------------------------------------------------------------------------------
2. Proposal to approve the Option Agreement.
For / / Against / / Abstain / /
- --------------------------------------------------------------------------------
3. Proposal to approve the Consulting Agreement.
For / / Against / / Abstain / /
- --------------------------------------------------------------------------------
4. Proposal to amend the Certificate of Incorporation.
For / / Against / / Abstain / /
- --------------------------------------------------------------------------------
5. Proposal to approve the selection of Rosenberg Rich Baker Berman & Company as
the Company's independent auditors for the fiscal year ending July 31, 1999.
For / / Against / / Abstain / /
- --------------------------------------------------------------------------------
6. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment or
adjournments thereof.
2
<PAGE>
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS AND WILL BE VOTED FOR THE
ELECTION OF THE PROPOSED DIRECTORS AND FOR THE ABOVE PROPOSALS UNLESS OTHERWISE
INDICATED.
SIGNATURE(S) should be exactly as name
[Sign, Date and Return the or names appear on this proxy. If stock
Proxy Card Promptly Using the is held jointly, each holder should
Enclosed Envelope.] sign. If signing is by attorney,
executor, administrator, trustee or
guardian, please give full title.
Dated _______________________, 1999
___________________________________
Signature
___________________________________
Print Name
___________________________________
Signature
___________________________________
Print Name
