<PAGE> 1
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 Rule 14a-11(c) or Rule 14a-12
SENSYTECH, INC.
---------------
(Formerly known as Sensys Technologies Inc.)
--------------------------------------------
(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):
[ X ] No fee required.
[ ] 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):
-------------------------------------------------------------
<PAGE> 2
(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:
-------------------------------------------------------------
2
<PAGE> 3
SENSYTECH, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD FEBRUARY 9, 2000
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Sensytech, Inc. will be held at the Hilton at Mark Center, 5000 Seminary Road,
Alexandria, Virginia, on Wednesday, February 9, 2000, at 10:00 a.m., local time,
for the following purposes:
(a) To elect seven members to the Board of Directors
(b) To ratify the appointment of independent auditors; and
(c) To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only stockholders of record at the close of business on December 20,
1999, will be entitled to notice of, and to vote at, the meeting and any
adjournment thereof.
THE BOARD OF DIRECTORS OF SENSYTECH, INC. HOPES THAT YOU WILL FIND IT
CONVENIENT TO ATTEND THE MEETING IN PERSON. EVEN IF YOU DO NOT GRANT YOUR PROXY,
IF YOU ARE PLANNING TO ATTEND THE MEETING, PLEASE INDICATE THAT FACT BY MARKING
THE APPROPRIATE LINE ON THE ACCOMPANYING PROXY FORM. WHETHER YOU INTEND TO
ATTEND THE MEETING OR NOT, PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY
IN THE ENCLOSED ENVELOPE TO MAKE SURE THAT YOUR SHARES ARE REPRESENTED AT THE
MEETING. IF YOU ATTEND THE MEETING, YOU MAY VOTE YOUR STOCK PERSONALLY EVEN
THOUGH YOU HAVE SENT IN YOUR PROXY.
By Order of the Board of Directors,
/s/ Lloyd A. Semple
-----------------------------------
Lloyd A. Semple
Secretary
Newington, Virginia
January 14, 2000
<PAGE> 4
SENSYTECH, INC.
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of Sensytech, Inc. (the "Company") for use
at the Annual Meeting of Stockholders of the Company ("Annual Meeting") on
Wednesday, February 9, 2000, at 10:00 a.m., local time, or at any adjournment
thereof, for voting on the matters set forth in the accompanying Notice of
Annual Meeting of Stockholders and in this Proxy Statement.
Only stockholders of record as of the close of business on December 20,
1999, will be entitled to vote at the Annual Meeting or any adjournment thereof.
The Company had 4,002,667 shares of Common Stock, $.01 par value (the "Common
Stock"), issued and outstanding as of that date. Presence in person or by proxy
of a majority of the shares of Common Stock outstanding on the record date is
required for a quorum. This Proxy Statement and the accompanying form of proxy
are being first sent or given to the Company's stockholders on or about January
19, 2000. Ten days before the Annual Meeting, a complete list of stockholders
entitled to vote at the meeting will be open to examination by any stockholder
for any purpose germane to the meeting during ordinary business hours at the
Company's principal office.
When proxies are properly dated, executed and returned, the shares they
represent will be voted at the Annual Meeting in accordance with the
instructions of the stockholder. If no specific instructions are given, the
shares will be voted FOR the election of the nominees for director set forth
herein, and FOR ratification of the appointment of auditors. In addition, if
other matters come before the Annual Meeting, the persons named in the
accompanying form of proxy will vote in accordance with their best judgment with
respect to such matters.
Shares represented by a proxy in the accompanying form, unless
previously revoked, will be voted at the meeting if the proxy, properly
executed, is received by the Company before the close of business on February 8,
2000. Shares represented by a proxy received after that time will be voted if
the proxy is received by the Company in sufficient time to permit the necessary
examination and tabulation of the proxy before a vote is taken. Stockholders who
execute a proxy in the accompanying form may nevertheless revoke the proxy at
any time before it is exercised by giving written notice to the Secretary prior
to the Annual Meeting, by executing and delivering a later dated proxy, or by
voting in person at the meeting.
Each share of Common Stock outstanding on the record date will be
entitled to one vote on all matters. The seven candidates for election as
directors at the Annual Meeting who receive the highest number of affirmative
votes will be elected. The ratification of the independent auditors for the
Company for the current fiscal year will require the majority vote of a majority
of the shares of the Company's Common Stock present or represented and entitled
to vote at the Annual Meeting. Because abstentions
<PAGE> 5
with respect to any matter are treated as shares present or represented and
entitled to vote for the purposes of determining whether that matter has been
approved by the stockholders, abstentions have the same effect as negative votes
for each proposal, other than the election of directors. Broker non-votes are
not deemed to be present or represented for purposes of determining whether
stockholder approval of that matter has been obtained, but they are counted as
present for purposes of determining the existence of a quorum at the Annual
Meeting.
The expenses of solicitation of proxies will be paid by the Company. In
addition to solicitation by mail, the officers and employees of the Company, who
will receive no extra compensation therefor, may solicit proxies personally or
by telephone. The Company will reimburse brokerage houses and other nominees for
their expenses incurred in sending proxies and proxy materials to the beneficial
owners of shares held by them.
2
<PAGE> 6
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Common stock is the only voting security of the Company. The following
table sets forth certain information with respect to the beneficial ownership of
shares of the Company's Common Stock, as of December 20, 1999, by each person
who is known by the Company to have been the beneficial owner of 5% or more of
the shares of Common Stock outstanding on that date. Unless otherwise noted,
each stockholder exercises sole voting and investment power with respect to the
shares beneficially owned.
PRINCIPAL HOLDERS OF SECURITIES
<TABLE>
<CAPTION>
- --------------------------------------------- ------------------------------ ------------------------------
NAME AND ADDRESS OF NUMBER OF PERCENT OF
BENEFICIAL OWNER SHARES (1) CLASS
- --------------------------------------------- ------------------------------ ------------------------------
<S> <C> <C>
S. Kent Rockwell
960 Penn Avenue, Suite 800
Pittsburgh, PA 15222 900,394 (2) 22.5
- --------------------------------------------- ------------------------------ ------------------------------
S. R. Perrino
Sensytech, Inc.
P. O. Box 1430
Newington, VA 22122 790,635 (3) 19.8
- --------------------------------------------- ------------------------------ ------------------------------
</TABLE>
(1) The column sets forth shares of Common Stock which are deemed to be
"beneficially owned" by the persons named in the table under Rule 13d-3 of
the SEC.
(2) Shares held by Rockwell Holdings, Inc., over which Mr. Rockwell has sole
voting and investment power.
(3) Includes 68,315 shares held of record by the 401(k) Profit Sharing Plan
over which Mr. Perrino has sole voting and investment power. Excludes
10,000 shares held of record owned by Mr. Perrino's spouse as to which Mr.
Perrino disclaims beneficial ownership.
OWNERSHIP OF EQUITY AND VOTING
SECURITIES BY DIRECTORS AND OFFICERS
The following table sets forth information with respect to the
beneficial ownership of the Company's Common Stock by each person nominated for
director, by each of the Executive Officers named in the Summary Compensation
Table (the "Named Executive Officers") and by all nominees and executive
officers as a group, as of December 20, 1999. Except as noted, each person
exercises sole voting and investment power over the shares beneficially owned.
3
<PAGE> 7
<TABLE>
<CAPTION>
- --------------------------------------------- ----------------------------------- -------------------------
NAME NUMBER OF SHARES(1) PERCENT OF CLASS(2)
- --------------------------------------------- ----------------------------------- -------------------------
<S> <C> <C>
Charles W. Bernard 25,800 .6
- --------------------------------------------- ----------------------------------- -------------------------
James B. Busey, IV 25,800 .6
- --------------------------------------------- ----------------------------------- -------------------------
Joseph C. Hassab 65,333 1.6
- --------------------------------------------- ----------------------------------- -------------------------
Thomas R. Ory 54,936(3) 1.4
- --------------------------------------------- ----------------------------------- -------------------------
S. R. Perrino 790,635(4) 19.8
- --------------------------------------------- ----------------------------------- -------------------------
Philip H. Power 27,420 .7
- --------------------------------------------- ----------------------------------- -------------------------
S. Kent Rockwell 900,394(5) 22.5
- --------------------------------------------- ----------------------------------- -------------------------
John D. Sanders 70,210(6) 1.7
- --------------------------------------------- ----------------------------------- -------------------------
John Irvin 4,521 .1
- --------------------------------------------- ----------------------------------- -------------------------
Charles G. Stanich 41,339 1.0
- --------------------------------------------- ----------------------------------- -------------------------
All directors and executive officers as a
group (10 persons) 2,004,388 48.5
- --------------------------------------------- ----------------------------------- -------------------------
</TABLE>
(1) The column sets forth shares of Common Stock, which are deemed to be
"beneficially owned" by the persons named in the table under Rule 13-d-3 of
the SEC, including shares of Common Stock that may be acquired upon
exercise of stock options that were exercisable as of December 20, 1999, or
within the next 60 days as follows: Dr. Bernard, 25,800; Dr. Hassab,
33,333; Mr. Power, 3,000; Dr. Sanders, 28,800; Mr. Ory, 20,000; and Mr.
Stanich, 20,000.
(2) For purposes of calculating the percentage of Common Stock beneficially
owned by any person or group, the shares issuable to such person or group
upon exercise of stock options that were exercisable as of December 20,
1999, or within the next 60 days, are considered outstanding.
(3) Includes 34,936 shares with respect to which Mr. Ory shares voting and
investment power with his spouse.
(4) Excludes 10,000 shares owned by Mr. Perrino's spouse as to which Mr.
Perrino disclaims beneficial ownership and 68,315 shares held in the 401(k)
Profit Sharing Plan over which Mr. Perrino has sole voting and investment
power.
(5) Shares held by Rockwell Holdings, Inc. over which Mr. Rockwell has sole
voting and investment power.
(6) Includes 550 shares owned by Dr. Sanders' spouse and 17,190 shares held
in a profit sharing plan over which Mr. Sanders has sole voting and
investment power.
4
<PAGE> 8
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors has the ultimate responsibility and authority
for the management of the Company's business, objectives and operations. It
selects the Company's executive officers, delegates authority for the conduct of
the Company's day-to-day operations to those officers, and monitors their
performance.
Seven directors, constituting the entire Board of Directors, will be
elected at the Annual Meeting, each to hold office until the next Annual Meeting
of Stockholders or until his successor, if any, is elected or appointed. The
individuals who have been nominated for election to the Board of Directors at
the Annual Meeting are listed in the table below. Each of the nominees is
presently a Director of the Company, except Mr. John Irvin.
If, as a result of circumstances not now known or foreseen, any of the
nominees is unavailable to serve as a nominee for the office of Director at the
time of the Annual Meeting, proxies may be voted either (i) for the election of
a substitute nominee who will be designated by the proxy holders or by the
present Board of Directors or (ii) for the balance of the nominees, leaving a
vacancy. Alternatively, the size of the Board may be reduced accordingly. The
Board of Directors has no reason to believe that any of the nominees will be
unwilling or unable to serve, if elected as a Director. The nominees receiving a
plurality of the votes cast at the meeting will be elected as Directors. PROXIES
IN THE ACCOMPANYING FORM WILL BE VOTED FOR THE ELECTION OF THE NOMINEES LISTED
BELOW, UNLESS THE PROXY CARD IS MARKED OTHERWISE. THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR THE ELECTION OF THE NOMINEES LISTED BELOW.
5
<PAGE> 9
NOMINEES
<TABLE>
<CAPTION>
- --------------------------- --------- ------------------------------------------------ --------------------
YEAR FIRST
POSITIONS WITH THE COMPANY ELECTED OR
NAME AGE AND PRINCIPAL OCCUPATION OR EMPLOYMENT APPOINTED DIRECTOR*
- --------------------------- --------- ------------------------------------------------ --------------------
<S> <C> <C> <C>
Charles W. Bernard 68 Consultant 1992
- --------------------------- --------- ------------------------------------------------ --------------------
John Irvin 45 Senior Financial Manager --
- --------------------------- --------- ------------------------------------------------ --------------------
Thomas R. Ory 61 President, Imaging Products 1987
- --------------------------- --------- ------------------------------------------------ --------------------
S. R. Perrino 65 Chairman of the Board 1972
- --------------------------- --------- ------------------------------------------------ --------------------
Philip H. Power 61 Chairman, HomeTown Communications Network, Inc. 1985
- --------------------------- --------- ------------------------------------------------ --------------------
S. Kent Rockwell 55 Vice Chairman, CEO, CFO 1987
- --------------------------- --------- ------------------------------------------------ --------------------
John D. Sanders 61 Investor/Consultant 1982
- --------------------------- --------- ------------------------------------------------ --------------------
</TABLE>
*Reflects the year first elected or appointed to the Board of Directors of S.T.
Research Corporation ("STR") or Daedalus Enterprises, Inc. ("DEI"). On June 9,
1998, a newly formed wholly-owned subsidiary of DEI merged into STR which
thereafter merged into DEI (which had on the same date changed its name to
Sensys Technologies Inc., and subsequently changed its name to Sensytech, Inc.).
This overall transaction is hereafter referred to in this Proxy Statement as the
"Merger". Messrs. Bernard, Busey, Perrino and Rockwell were elected or appointed
to the Board of Directors of the Company in June 1998 in connection with the
Merger.
Admiral James B. Busey, IV will not seek reelection to the Board of
Directors for the upcoming year.
CERTAIN INFORMATION REGARDING NOMINEES
S. R. Perrino is Chairman of the Board and served as President and CEO
of STR since 1972 through the date of the Merger. He served as CEO of the
Company from June 9, 1998 until July 7, 1998. From 1967 to 1974, Mr. Perrino
worked as a consultant to the U.S. Navy for threat warning systems, and to
various companies including STR, Systems Dynamic, Inc., and System Consultants.
From 1960 through 1967, Mr. Perrino served as Director of Marketing/Project
Engineer and was one of the original founders of Radiation Systems, Inc.
S. Kent Rockwell, Vice Chairman, CEO, and CFO, is former Chairman of
the Board, President and CEO of Astrotech International Corporation, where he
served from 1986 to 1997. Mr. Rockwell has served as Chairman of Rockwell
Forest Products, Inc. since 1983, Appalachian Timber Services, Inc. since 1988;
and Chairman and President of Rockwell Venture Capital, Inc. since 1983. Mr.
Rockwell previously served on the board of Rockwell International, Inc. from
1973 to 1983.
6
<PAGE> 10
Dr. Charles Bernard, Director, served in a number of Government
positions. He was Technical Director of the Naval Weapons Laboratory in
Dahlgren, Virginia, from 1973 to 1975, and the Naval Ordnance Laboratory in
White Oak, Maryland, from 1975 to 1977. He was Director of Land Warfare on the
staff of the Under Secretary of Defense for Research, Development and
Acquisition from 1978 to 1988. He founded the Columbia Bay Company and
co-founded K&B Engineering Associates in 1995. Dr. Bernard has been on the
boards of directors of the Naval Weapons Laboratory from 1969 to 1975, the Naval
Ordnance Laboratory from 1975 to 1977, the Naval Surface Weapons Center from
1975 to 1977, the Columbia Bay Company from 1988 to present, and K&B Engineering
Associates from 1995 to present.
Dr. John D. Sanders, Director, serves as a business consultant to
emerging technology companies. He was Chairman and Chief Executive Officer of
Tech News, Inc., a technology news publisher, from 1988 to 1996, prior to its
sale to the Washington Post Company. In addition, Dr. Sanders has been a
Registered Representative (now inactive) of Wachtel & Co., Inc., a Washington
D.C.-based stock brokerage firm, since 1968. Dr. Sanders serves on the boards of
directors of Hadron Inc., ITC Learning Corporation, and Comtex News Network,
Inc.
Mr. Thomas R. Ory, Director, joined Daedalus Enterprises Inc. (the
Company's predecessor) in 1972 as Director of its Applications Division, and
served as Vice President-Marketing from 1979 to 1984, and Executive Vice
President from 1985 to August 1987, when he was appointed President and Chief
Executive. Since June 1998, Mr. Ory has been an officer of Sensytech, Inc.
Mr. John Irvin, nominee for Director, is President of Innovative
Benefits Consulting, Inc., a benefits and insurance consulting firm. From 1983
through 1993, Mr. Irvin was Vice Chairman and co-founder of Mid Atlantic Capital
Group and President of Mid Atlantic Insurance Corporation, where he specialized
in serving the financial planning, asset management and insurance needs of high
net worth individuals. He also chaired the committee which oversaw mergers,
acquisitions and strategic planning for the company. Prior to that, Mr. Irvin
managed his own certified public accounting firm. He serves on the board of
directors of Partners Financial, a national producer group.
Mr. Philip Power, Director, has served as Chairman of HomeTown
Communications Network, Inc., Livonia, Michigan, (formerly known as Suburban
Communication Corporation), for more than 20 years. Mr. Power currently serves
on the board of Jacobson Stores, Inc.
7
<PAGE> 11
MEETINGS AND COMMITTEES OF THE BOARD
During the last fiscal year, the Board of Directors of the Company met
a total of five times. The Audit Committee met one time, and the Executive
Compensation/Stock Option Committee met two times. Each of the directors
attended 75 percent or more of the aggregate number of meetings of the Board and
Committees on which he served during the last fiscal year, except Admiral Busey,
who attended 60 percent of the aggregate number of Board meetings and 100
percent of meetings of the Committees on which he served during the last fiscal
year.
The members of the Audit Committee are Messrs. Busey, Bernard and
Rockwell. Generally, the Audit Committee recommends for approval by the Board of
Directors the independent auditors for each fiscal year, reviews with the
independent auditors the scope and results of the audit engagement and any
non-audit services to be performed by the independent auditors. The Audit
Committee also examines the scope and results of the Company's procedures, the
adequacy of its system of internal accounting and financial controls, and
evaluates the independence of the independent auditors and their fees for
services.
The members of the Executive Compensation/Stock Option Committee are
Messrs. Power, Sanders and Busey. The Executive Compensation/Stock Option
Committee is responsible for reviewing the performance of, and recommending
salaries and other compensation arrangements for, officers of the Company, as
well as reviewing bonus, pension and other compensation plans prepared by
management for consideration by the Board, and performing such other functions
as may be delegated to it under the provisions of any bonus, stock option,
pension or other compensation plan adopted by the Company.
The Company does not have a standing nominating committee.
COMPENSATION OF DIRECTORS
Effective June 9, 1998, outside directors receive $1,200 per quarter
with an additional payment of $300 for each Board or Committee meeting attended,
and are reimbursed for travel expenses incurred in connection with their
attendance at Board and Committee meetings. Employee directors do not receive
directors' fees.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth the annual compensation for the years
indicated for the person who served as the Company's Chief Executive Officer
during fiscal 1999 and for the four most highly compensated executive officers
of the Company, other than the Chief Executive Officer, serving at the end of
fiscal 1999. The table shows compensation paid by the Company following the
Merger and amounts paid by DEI or STR prior to the Merger.
8
<PAGE> 12
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
NAME AND
PRINCIPAL FISCAL
POSITION YEAR ANNUAL COMPENSATION LONG TERM COMPENSATION
- -----------------------------------------------------------------------------------------------------------------------------
Other Annual
Salary Bonus(1) Compensation(2)
($) ($) ($) Awards Payouts
- -----------------------------------------------------------------------------------------------------------------------------
Securities
Restricted Underlying
Stock Options/SARs LTIP
Award(s)(3) (#) Payouts
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
S. Kent
Rockwell
Vice 1999 $ 96,919 $ 300 $ 0 $ 0 0 $ 0
Chairman, 1998(4) $ 0 $ 0 $ 0 $ 0 0 $ 0
CEO, CFO 1997 $ 0 $ 0 $ 0 $ 0 0 $ 0
- -----------------------------------------------------------------------------------------------------------------------------
Joseph C. 1999 $ 185,016 $45,000 $ 0 $45,000 100,000 $ 0
Hassab 1998(5) $ 19,925 $ 0 $ 0 $ 0 0 $ 0
President 1997 $ 0 $ 0 $ 0 $ 0 0 $ 0
- -----------------------------------------------------------------------------------------------------------------------------
Thomas R. Ory 1999 $ 154,814 $ 3,654 $ 0 $ 1,935 0 $ 0
President, 1998 $ 150,848 $ 0 $25,717 $ 0 0 $ 0
Imaging Products 1997 $ 148,000 $ 0 $26,315 $ 0 20,000 $ 0
- -----------------------------------------------------------------------------------------------------------------------------
S. R. Perrino 1999 $ 175,884 $ 300 $ 0 $ 0 0 $ 0
Chairman of 1998 $ 175,884 $ 0 $24,951 $ 0 0 $ 0
the Board 1997 $ 179,267 $ 0 $10,357 $ 0 0 $ 0
- -----------------------------------------------------------------------------------------------------------------------------
Charles G. Stanich(6) 1999 $ 136,802 $ 3,264 $ 0 $ 1,710 0 $ 0
Vice President, 1998 $ 132,202 $ 0 $22,207 $ 0 0 $ 0
Imaging Products 1997 $ 130,000 $ 0 $24,941 $ 0 20,000 $ 0
- -----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
NAME AND
PRINCIPAL
POSITION
- --------------------------------------
- --------------------------------------
All Other
Compensation
- --------------------------------------
<S> <C>
S. Kent
Rockwell
Vice $ 0
Chairman, $ 0
CEO, CFO $ 0
- --------------------------------------
Joseph C. $ 0
Hassab $ 0
President $ 0
- --------------------------------------
Thomas R. Ory $ 0
President, $ 0
Imaging Products $ 0
- --------------------------------------
S. R. Perrino $ 0
Chairman of $ 0
the Board $ 0
- --------------------------------------
Charles G. Stanich(6) $ 0
Vice President, $ 0
Imaging Products $ 0
- --------------------------------------
</TABLE>
(1) Paid pursuant to the Company's Incentive Compensation Plan.
(2) Detail of amounts reported in the "Other Annual Compensation" column is
in the table below.
(3) Paid pursuant to the Company's Incentive Compensation Plan. Shares vest
evenly over a three-year period.
(4) Mr. Rockwell became an unpaid employee of the Company effective July 1,
1998. He began receiving compensation at an annual rate of $100,000
effective October 1, 1998.
(5) Dr. Hassab began employment with the Company on August 24, 1998, at an
annual salary of $185,000.
(6) Mr. Stanich served as the Company's Chief Operating Officer until June 9,
1998; he currently serves as the Company's Vice President.
The following table provides information regarding Other Annual
Compensation not properly categorized as salary or bonus:
9
<PAGE> 13
<TABLE>
<CAPTION>
- ------------------------- ----------- ------------------- ----------------- -------------- ----------------
401(k)/
PENSION
OFFICER'S FISCAL PLAN EXCESS LIFE EXCESS AUTO/
NAME YEAR CONTRIBUTION INSURANCE VACATION FUEL
- ------------------------- ----------- ------------------- ----------------- -------------- ----------------
<S> <C> <C> <C> <C> <C>
S. Kent Rockwell 1999 $ 2,201 $ 458 $ 0 $ 0
1998 $ 0 $ 0 $ 0 $ 0
1997 $ 0 $ 0 $ 0 $ 0
- ------------------------- ----------- ------------------- ----------------- -------------- ----------------
Joseph C. Hassab 1999 $ 2,144 $1,316 $ 0 $1,899
1998 $ 0 $ 94 $ 0 $ 151
1997 $ 0 $ 0 $ 0 $ 0
- ------------------------- ----------- ------------------- ----------------- -------------- ----------------
Thomas R. Ory (1) 1999 $ 4,317 $1,597 $ 0 $ 0
1998 $17,873 $ 553 $ 0 $ 0
1997 $18,384 $ 450 $ 0 $ 0
- ------------------------- ----------- ------------------- ----------------- -------------- ----------------
S. R. Perrino 1999 $ 3,865 $1,901 $ 0 $2,046
1998 $ 6,652 $1,755 $14,368 $2,176
1997 $ 6,457 $1,755 $ 0 $2,144
- ------------------------- ----------- ------------------- ----------------- -------------- ----------------
Charles G. Stanich(1) 1999 $ 3,008 $ 848 $ 0 $ 0
1998 $14,618 $ 340 $ 0 $ 0
1997 $16,028 $ 288 $ 0 $ 0
- ------------------------- ----------- ------------------- ----------------- -------------- ----------------
</TABLE>
(1) Other Annual Compensation for Thomas R. Ory and Charles G. Stanich also
includes:
<TABLE>
<CAPTION>
- ------------------------- ----------- ------------------- ------------------------------ ------------------
DIRECTOR'S FISCAL DIRECTOR'S MEDICAL IMPUTED
NAME YEAR FEE REIMBURSEMENTS INTEREST
- ------------------------- ----------- ------------------- ------------------------------ ------------------
<S> <C> <C> <C> <C>
Thomas R. Ory 1999 $ 0 $ 0 $ 0
1998 $5,100 $ 991 $ 0
1997 $4,800 $2,630 $ 50
- ------------------------- ----------- ------------------- ------------------------------ ------------------
Charles G. Stanich 1999 $ 0 $ 0 $ 0
1998 $5,100 $2,149 $ 0
1997 $4,500 $4,125 $ 0
- ------------------------- ----------- ------------------- ------------------------------ ------------------
</TABLE>
OPTIONS
The following table provides information about the stock options shown
in the "Securities Underlying Options/SAR's" column of the Summary Compensation
Table, which were granted in fiscal 1999 to the named Executive Officers.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
- ---------------------- -------------------- --------------------- --------------------- --------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO EXERCISE OR
OPTIONS/SARS EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED FISCAL YEAR ($/SHARE) DATE
- ---------------------- -------------------- --------------------- --------------------- --------------------
<S> <C> <C> <C> <C>
Joseph C. Hassab 100,000(1) 23.34% $3.00 10/5/08
- ---------------------- -------------------- --------------------- --------------------- --------------------
</TABLE>
(1) Options exercisable over a three-year period.
10
<PAGE> 14
The following table provides information concerning stock option
exercises in fiscal 1999 by the Named Officers and the value of their
unexercised options at September 30, 1999.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT OPTIONS AT
ACQUIRED FISCAL YEAR FISCAL YEAR
ON VALUE END (#) END ($)
EXERCISE REALIZED EXERCISABLE (E)/ EXERCISABLE (E)/
NAME (#) ($) UNEXERCISABLE (U) UNEXERCISABLE (U)
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
S. Kent Rockwell 0 $ 0 0 $ 0
- -------------------------------------------------------------------------------------------------------------
Joseph C. Hassab 0 $ 0 100,000 (U) $300,000 (U)
- -------------------------------------------------------------------------------------------------------------
Thomas R. Ory 0 $ 0 20,000 (E) $ 75,000 (E)
- -------------------------------------------------------------------------------------------------------------
S. R. Perrino 0 $ 0 0 $ 0
- -------------------------------------------------------------------------------------------------------------
Charles G. Stanich 0 $ 0 20,000 (E) $ 75,000 (E)
- -------------------------------------------------------------------------------------------------------------
</TABLE>
BUSINESS EXPERIENCE OF EXECUTIVE OFFICERS
The following sets forth the business experience of the executive
officer who is not also a director of the Company.
Joseph C. Hassab, Ph.D., age 58, joined the Company in August, 1998 as
President and Chief Operating Officer. Dr. Hassab has over 25 years experience
in acquisition and development of large military systems. He was previously
employed by Lockheed Martin Corporation and predecessor companies, General
Electric Corporation and Radio Corporation of America (RCA) from 1985 to 1998.
Dr. Hassab was employed by the U.S. Navy at its Naval Undersea Warfare Center
from 1971 to 1985.
INCENTIVE COMPENSATION PLAN
The Company has adopted an Incentive Compensation Plan for all
employees, including executive officers, under which performance targets are
established for each employee for each fiscal year. Each employee earns an
incentive bonus consisting of a combination of a cash payment and shares of
Company Common Stock, based on whether he or she met the applicable target. Mr.
Rockwell and Mr. Perrino do not participate in the Incentive Compensation Plan.
11
<PAGE> 15
DEFERRED COMPENSATION PLAN
Prior to the Merger, Mr. Perrino entered into certain arrangements with
STR, a predecessor of the Company, to defer portions of his salary from STR. STR
accrued interest on the deferred income. These arrangements were assumed by the
Company in the Merger and interest is currently being accrued on this account at
the prime rate (as defined) plus 1/2%. The amount in the deferred account is
payable upon Mr. Perrino's retirement as a full-time employee of the Company.
EMPLOYMENT AGREEMENTS
The Company's employment agreement with Joseph C. Hassab requires the
Company to pay him upon termination, as Company President, severance
compensation of salary and benefits for two years.
Thomas R. Ory and Charles G. Stanich are each a party to an Employment
Agreement that requires the Company to pay him an amount equal to his present
salary and benefits until June 8, 2000, if termination of his employment meets
one of several criteria. There are further provisions for severance pay under
certain conditions. In general, such amounts would be payable upon resignation
following a reduction in his salary or other compensation, any diminution of
authority or duties or a significant change in the nature and scope of the
duties or any change in the status or title (other than a bona fide promotion).
The cash payment required under the agreement may be paid in a lump sum or in
monthly installments. If Mr. Ory or Mr. Stanich is employed subsequent to June
8, 2000, he is entitled to six months' severance plus benefits, if terminated by
the Company.
TERMINATION AGREEMENT
Robert R. Bower, a former executive officer of the Company, and the
Company entered into a Separation Agreement and Release of Claims dated August
13, 1999 (the "Agreement"). Under it, the Company agreed to pay Mr. Bower five
(5) months base salary plus $150,000, as severance pay, and to continue his
benefits through April 30, 2000. The Company also agreed to permit Mr. Bower to
fully exercise his vested and unvested stock option, which was granted under the
former STR option plan, to purchase approximately 15,000 shares of Company
Common Stock until February 13, 2000. The stock option previously issued to Mr.
Bower under the Company's Incentive Compensation Plan was terminated. Mr. Bower
agreed to provide certain consulting services to the Company, without further
compensation, and to waive certain possible claims against the Company.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Prior to June 30, 1999, the Company leased its principal facility in
Newington, Virginia, under two triple-net leases, from two separate partnerships
in which executive officers of the Company, along with other stockholders of the
Company, participated. The Company leased approximately 56,000 square feet from
Research Development
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Properties, a partnership in which S. R. Perrino and Robert Bower, the Company's
Chairman and former Chief Financial Officer, respectively, each held a 1/14th
interest along with 12 other persons, who each held a 1/14th interest. Of these
12 other partners, six were also stockholders in the Company. The second lease
was with Terminal Real Estate, a partnership in which S. R. Perrino was a 50%
partner. The remaining 50% interest in this partnership was also held by a
stockholder in the Company. On June 30, 1999, the facilities were sold to an
unrelated third party.
During the fiscal year ending September 30, 1999, the Company paid
Research Development Properties and Terminal Real Estate approximately $260,600
and $53,400, respectively, in rent. The rents paid under both leases were at the
same rate per square foot.
SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange
Act") requires the Company's officers and directors, and persons who own more
than 10% of a registered class of the Company's equity securities, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission ("SEC"). They are required by SEC regulation to furnish the Company
with copies of all Section 16(a) forms they file. Based solely on its review of
the copies of such forms received by it, or written representations from certain
reporting persons that no other reports were required for fiscal year 1999, the
Company believes that all Section 16(a) filing requirements applicable to the
directors, officers and 10% stockholders were complied with, except that Mr.
Bower, a former officer of the Company, filed one late report of a transaction.
PROPOSAL 2
RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has, upon recommendation of the Audit Committee,
selected PricewaterhouseCoopers LLP as independent auditors of the Company for
the fiscal year ending September 30, 2000, and has further directed that the
selection of such auditors be submitted for ratification by the stockholders at
the Annual Meeting. PricewaterhouseCoopers LLP has been the independent auditors
of the Company since the Merger.
During the Company's two most recent fiscal years, there has been no
reportable event as defined in Regulation S-B Item 304(s)(1)(v).
The Company engaged PricewaterhouseCoopers LLP (formerly Coopers &
Lybrand, L.L.P.) as the Company's new independent accountants as of June 9,
1998. PricewaterhouseCoopers LLP had served as the independent accountants of
STR for fiscal year ended September 30, 1997. The Company has been advised by
PricewaterhouseCoopers LLP that neither the firm nor any of its associates had
any relationship with the Company other than the usual relationship that exists
between
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independent certified public accountants and their clients during the
last fiscal year. Representatives of PricewaterhouseCoopers LLP will attend the
meeting, at which time they may make any statement they consider appropriate and
will respond to appropriate questions raised at the meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE FOR
APPROVAL OF THE PROPOSAL TO RATIFY THE APPOINTMENT OF INDEPENDENT AUDITORS.
GENERAL
At the date of this Proxy Statement, management is not aware of any
matters to be presented for action at the meeting other than those described
above. However, if any other matters should come before the Annual Meeting, it
is the intention of the persons named in the accompanying proxy to vote such
proxy in accordance with their judgment on such matters.
STOCKHOLDER PROPOSALS FOR YEAR 2001 ANNUAL MEETING
Proposals by stockholders, which are intended to be presented at the
Company's 2001 Annual Meeting of Stockholders, must be submitted in writing to
the Secretary of the Company no later than September 5, 2000. The submission of
a stockholder proposal does not guarantee that it will be included in the
Company's proxy statement for the next annual meeting.
By order of the Board of Directors
/s/ Lloyd A. Semple
----------------------------------
Lloyd A. Semple
Secretary
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PROXY PROXY
2000 ANNUAL STOCKHOLDERS' MEETING
SENSYTECH, INC.
The 2000 Annual Meeting of Stockholders of Sensytech, Inc. will be held
at the Hilton at Mark Center, Alexandria, Virginia, on Wednesday, February 9,
2000, at 10:00 a.m., local time. The undersigned hereby constitutes and appoints
Joseph C. Hassab and Darla Cavaliere, or either of them, with power of
substitution, as attorneys and proxies to appear and vote, as designated below,
all of the shares of Common Stock of Sensytech, Inc. that the undersigned is
(are) entitled to vote at the 2000 Annual Meeting and at any adjournments
thereof, upon the following matters which are being proposed by the Company:
1. Election of Directors. For the election as directors of all nominees listed
below (except as marked to the contrary): [ ]
[ ] Charles W. Bernard; [ ] John Irvin; [ ] Thomas R. Ory; [ ] S. R. Perrino;
[ ] Philip H. Power; [ ] S. Kent Rockwell; [ ] John D. Sanders
Withhold authority for the following:
[ ] Charles W. Bernard; [ ] John Irvin; [ ] Thomas R. Ory; [ ] S. R. Perrino;
[ ] Philip H. Power; [ ]S. Kent Rockwell; [ ] John D. Sanders
Withhold authority for all nominees: [ ]
2. Ratification of selection of independent auditors. To ratify the
selection of PricewaterhouseCoopers LLP as the Company's independent accountants
for the 2000 Fiscal Year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
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THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED; IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES. IN THEIR
DIRECTION, THE PROXIES ARE ALSO AUTHORIZED TO VOTE UPON SUCH OTHER MATTERS AS
MAY PROPERLY COME BEFORE THE MEETING, INCLUDING THE ELECTION OF ANY PERSON TO
THE BOARD OF DIRECTORS WHERE A NOMINEE NAMED IN THE PROXY STATEMENT DATED
JANUARY 14, 2000 IS UNABLE TO SERVE OR, FOR GOOD CAUSE, WILL NOT SERVE.
I (we) acknowledge receipt of the Notice of Annual Meeting of Stockholders and
the Proxy Statement dated January 14, 2000, and the 1999 Annual Report to
Stockholders and ratify all that the proxies, or either of them, or their
substitutes may lawfully do or cause to be done by virtue hereof and revoke all
former proxies.
--------------------------------------------------------------
Signature Date
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Signature Date
NOTE: Please sign exactly as name(s) appear(s) on stock records.
When signing as attorney, administrator, trustee, guardian or
corporate officer, please so indicate.
Comments/Address Changes:
I/We plan to attend the Annual Meeting. ________
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF SENSYTECH, INC.
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