PROXY STATEMENT
IN OPPOSITION TO
MANAGEMENT AND THE CURRENT BOARD OF
DIRECTORS
OF
DDL ELECTRONICS, INC.
ANNUAL MEETING OF SHAREHOLDERS
SCHEDULED FOR MAY 31, 1995
Dear Fellow Shareholders in DDL ELECTRONICS, INC.:
This Proxy Statement is being sent to you by a group
of your fellow stockholders,
SCRMM ("Shareholders' Committee to Remove a
Moribund
Management"), in connection with
our solicitation of proxies to be used at the Annual
Meeting of
Shareholders of DDL Electronics,
Inc. ("DDL"), now set for Wednesday, May 31, 1995, at
10:00 AM
local time in Rosemont,
Illinois. Shareholders of DDL as of April 17, 1995, are
entitled
to vote at the forthcoming
Annual Meeting. We seek your proxy to:
1. TAKE CONTROL OF DDL BY THE ONLY METHOD
AVAILABLE -
EXPANDING THE BOARD OF DIRECTORS AND
ELECTING A NEW
MAJORITY - TO BRING AN END TO THE
DISAPPOINTING RESULTS THAT
THE CURRENT BOARD HAS OBTAINED FOR YOU
SINCE THEY HIRED
CURRENT MANAGEMENT 3.5 YEARS AGO, AND
2. ELECT A NEW MAJORITY OF THE BOARD OF
DIRECTORS, WHICH WILL
HAVE AS ITS SOLE OBJECTIVE TO INCREASE
THE
SALES, EARNINGS,
BOOK VALUE, CASH FLOW, SHARE TRADING
VOLUME
AND SHARE
PRICE OF DDL.
IF YOU OWN YOUR SHARES IN DDL IN THE NAME
OF A
BROKERAGE FIRM, YOU
MUST TELL YOUR BROKER HOW TO VOTE YOUR
SHARES.
YOUR BROKERS CAN
NOT VOTE AS YOU WISH UNLESS YOU GIVE THEM
SPECIFIC INSTRUCTIONS TO
DO SO. THESE INSTRUCTIONS CAN BE CONVEYED
BY
SIGNING, DATING AND
MAILING YOUR GREEN PROXY CARD TODAY.
PLEASE DO NOT RETURN THE PROXY CARD SENT
TO
YOU BY DDL
MANAGEMENT. IF YOU HAVE ALREADY
RETURNED
DDL'S PROXY, YOU HAVE
THE RIGHT TO REVOKE THIS AUTHORIZATION BY
RETURNING OUR LATER
PROXY. ONLY YOUR LATEST DATED, PROPERLY
EXECUTED PROXY WILL
COUNT AT THE ANNUAL MEETING. THE ONLY WAY
YOU
CAN VOTE FOR OUR
NOMINEES IS TO COMPLETE AND RETURN THE
ENCLOSED GREEN PROXY CARD.
We urge you to join us, by giving SCRMM your proxy,
to put
a new team in control of
the Board of Directors of DDL. VOTE FOR an end to the
performance of the past three and a
half years. VOTE FOR placing control of DDL in the
hands of
your fellow shareholders who
have the same desires as you to see the sales, earnings,
book
value, and stock price of DDL
increase. We have no doubt that our proposed slate of
Directors
will accomplish considerably
better results for DDL shareholders than we have seen
under
the current Board of Directors.
VOTE FOR THE FOLLOWING PROPOSALS:
PROPOSAL 1: NOMINEES FOR ELECTION AS CLASS
II
DIRECTORS
The DDL's Board of Directors is presently composed of
four
Directors, divided into
three classes of Directors who serve for three-year terms:
one in
Class I (whose term of office
expires in 1996), two in Class II (whose term of office
expired in
1994) , and one in Class III
(whose term of office expires in 1995). The two Class II
Directors to be elected at the Annual
Meeting scheduled for May 31 will serve until the 1997
Annual
Meeting of Shareholders, and
thereafter until their successors shall have been elected
and
qualified.
In opposition to the two incumbent Class II Directors
put
forward for re-election by
DDL, SCRMM proposes two experienced and
exceptionally
well-qualified nominees. If elected,
these two nominees would hold two of the four seats on
the
Board of Directors as presently
constituted.
Each nominee has consented to serve as a director of
DDL if
elected. SCRMM does not
expect that either of the nominees will be unable to stand
for
election but, in the event that a
vacancy in the slate of nominees should occur
unexpectedly, the
Shares represented by the
enclosed GREEN Proxy Card will be voted for a substitute
candidate selected by SCRMM.
The following information concerning business
address, age,
and principal occupation
has been furnished by SCRMM's nominees.
Bernee D. L. Strom
332 S. Michigan Avenue, #605
Chicago, Illinois 60604<PAGE>
Ms. Strom is currently President of USA Digital Radio, a
joint
venture partnership of Gannett Corporation,
Westinghouse, and
CBS. Since 1994, she has chaired the Board of Directors
of
Quantum Development Corporation, a business analysis
and
optimization consulting and technology company. She is
also a
director of Software Publishing Corporation, a NASDAQ
traded
company, and a member of the Board of Advisors of J.L.
Kellogg
Graduate School of Management at Northwestern
University.
From 1990-1995, Ms. Strom headed her own consulting
company.
During that time, she also served as a founding
shareholder,
consultant and Vice President of Gemstar Development
Corporation, which is the developer, manufacturer and
distributor
of the "VCR+" product. Other clients of Ms. Strom's
consulting
company from 1990-95 included the Chicago Sun-Times
and
Microware Systems. Prior to starting her own consulting
company
in 1990, Ms. Strom was a senior executive of the Los
Angeles
Herald Examiner; and former senior management
consultant
with
Deloitte, Haskins & Sells. Ms. Strom holds a Masters in
Mathematics from New York University, and an M.B.A.
from
UCLA. Ms. Strom is 47 years old.<PAGE>
Erven Tallman
72420 Beverly Way
Rancho Mirage, California
92260<PAGE>
Mr. Tallman has over 45 years of business experience as a
founder,
owner, director and operator of a variety of businesses.
Since
1964,
Mr. Tallman has served as a founder, and current
General
Managing Partner, of Inland Empire Properties, Ltd., a
large
privately-held commercial and industrial real estate
development
company. Since 1990, Mr. Tallman has served as founder
and
President of Phone Alert Corporation, a telephone-based
security
company, and Pactall Corporation, a software
development
company for automated wireless integrated systems. He
is also
Chief Executive Officer of E.B. Tall, Inc., a company
which he
founded in 1979. Prior to 1990, Mr. Tallman served as
founder,
director, or president of the following companies: Norco
Industries,
a privately held industrial distribution company; Tallman
Construction, a company ultimately acquired by Imasco, a
publicly
traded corporation in Canada; and Tallman Industries, an
electronic
royalty company which was purchased by DDL in 1979.
Mr.
Tallman is 67 years old, and a shareholder in DDL.<PAGE>
None of the nominees has ever been convicted in a
criminal
proceeding (excluding traffic
violations or similar misdemeanors). None of the
nominees has
been a party to a civil
proceeding of a judicial or administrative body of
competent
jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final
order
enjoining further violations of,
or prohibiting activities subject to, federal or state
securities
laws or finding any violation of
such laws. Additional information concerning nominees
who
own stock in DDL is provided in
Appendix A hereto.
Two of DDL's executives have entered into severance
agreements with the Company
which call for payments to be made if their employment is
terminated other than for cause within
one year from the date of a change of control of the
Company. If
SCRMM's nominees for Class
II Director are elected, and Proposals No. 2 and No. 3
herein are
not adopted, the resulting Board
of Directors will consist of two old members and two new
members. Under these circumstances,
we believe that no change of control will occur and that
these
two severance agreements, if valid,
will not be invoked.
SCRMM urges you to sign, date and return the
enclosed
GREEN proxy card to vote
for the election of SCRMM's nominees as Class II
Directors.
PROPOSAL NO. 2: AMENDMENT OF THE BYLAWS
TO
SET THE NUMBER
OF DIRECTORS AT NOT LESS THAN
SEVEN
Section 3.02 of DDL's Bylaws deals with the number
and
term of office of members of the
Board of Directors. According to identical copies of the
Bylaws
provided by DDL's Chief
Executive Officer in June 1994, and in January 1995 by
Disclosure Information Services, Inc.,
Section 3.02 provides:
"SECTION 3.02 Number and Term of Office.
The
number of directors shall
be seven (7). Directors need not be stockholders.
Each
of the directors of the
Corporation shall hold office until his successor
shall
have been duly elected and
shall qualify or until he shall resign or shall have
been
removed in the manner
hereinafter provided." (Emphasis supplied)
This notwithstanding, DDL has set the size of the current
Board
of Directors at four. The
October 28, 1993, proxy statement of DDL, relating to the
last
Annual Meeting of Shareholders
held in December 1993, says that the Board of Directors
"in
accordance with DDL's Bylaws,
reduced the size of the Board of Directors to three. . . ." A
Company press release subsequently
announced that the size of the Board of Directors had
been
increased to four with the addition of
Mr. Coyne, an employee of DDL.
In view of the foregoing, it is apparent that the size
of the
Board has been shrinking and
growing more inbred. In recent years, with each available
vacancy the current Board of
Directors has reduced the overall size of the Board so that
no
new member was elected.
We believe that this has deprived DDL of new ideas and
expertise on the Board of
Directors, qualities which DDL desperately needs.
Accordingly, pursuant to DDL Bylaw Section 8.03,
SCRMM proposes that the shareholders
adopt the following Proposal to amend Bylaw Section
3.02:
"PROPOSAL NO. 2:
Effectively immediately upon adoption by the
Shareholders, Section 3.02 of DDL's
Bylaws are amended as follows:
Text of Amendment
SECTION 3.02 Number and Term of Office.
The
number of directors shall
be not less than seven (7). Directors need not be
stockholders. Each of the
directors of the Corporation shall hold office until
his
successor shall have been
duly elected and shall qualify or until he shall
resign or
shall have been removed
in the manner hereinafter provided.' (New
language
shown in italics)
Immediately following adoption of this amendment
to the
Bylaws, there shall be an
election of the number of new Directors required to
comply
with the Bylaw provision that
there be no less than the seven (7) members of the
Board.
In accordance with Article Six
of the Company's Certificate of Incorporation, two
(2)
persons shall be elected to serve as
Class I Directors, with terms expiring at the annual
meeting of shareholders in 1996; and
one person shall be elected to serve as a Class III
Director,
with a term expiring at the
annual meeting of shareholders in 1995. "
Pursuant to Section 8.03 of the Company's Bylaws,
stockholders may alter, amend or repeal,
or make new bylaws, at any annual meeting, without
previous
notice. Under Delaware law, such
amendments to the Bylaws are effective immediately.
Further,
absent a Bylaw provision to the
contrary, Delaware law accords stockholders the inherent
power
to fill newly-created
directorships. The Company's Bylaws do not contain any
provision which divests the
stockholders of this power. Moreover, Section 3.03 of the
Bylaws
provides that the Company's
Directors shall be elected annually. Therefore, under the
laws of
the State of Delaware and
under DDL's Bylaws, the stockholders can both amend
Section
3.02 of the Bylaws and fill the
new directorships to be created by amendment at the
Annual
Meeting.
Article Six of the Company's Certificate of
Incorporation
creates three classes of Directors --
Class I, Class II, and Class III -- and further provides that
such
classes shall be as nearly equal in
number as possible. Currently, there is one Class I
Director
(whose term expires in 1996); two
Class II Directors (both of whose terms expired in 1994);
and
one Class III Director (whose term
expires in 1995). The addition of two Class I Directors
and one
Class III Director will make the
classes as nearly equal in number of Directors as possible,
i.e.
three, two, and two, respectively.
The affirmative vote of a majority of the shares of
DDL's
Common Stock issued and
outstanding is required in order for Proposal No. 2 to be
adopted. Because amendment of the
Bylaws by the stockholders requires an affirmative vote
by a
majority of the outstanding shares
of Common Stock, any vote to ABSTAIN, and any broker
non-votes, on Proposal No. 2 will
have the effect of a vote AGAINST the proposal.
PROPOSAL 3: NOMINEES FOR ELECTION AS NEW
CLASS
III AND CLASS I
DIRECTORS ON THE SEVEN MEMBER
BOARD
Assuming that the Shareholders adopt Proposal No.
2
setting the number of Directors at
seven, effective immediately upon adoption, it will then be
necessary for the Annual Meeting to
elect three new Board members.
The election will be conducted in accordance with
the
provisions of DDL's Certificate of
Incorporation and Bylaws governing the election of
Directors.
Specifically, Stockholders are
entitled to cumulate their votes in the election of each
Class of
Directors by casting for the
election of one nominee a number of votes equal to the
number
of Directors to be elected in each
Class multiplied by the number of shares owned by the
Stockholder, or may distribute such votes
on the same principle among as many candidates as the
Stockholder sees fit. For Class III
Directors, a Stockholder will be entitled to multiply the
number
of shares owned by two (2), and
to distribute such votes between the two nominees as the
Stockholder sees fit. For Class I
Director, cumulative voting will have no practical effect
since
there is only one Director to be
elected. If a proxy is marked for the election of Directors,
it
may, at the discretion of the proxy
holders, be voted cumulatively in the election of Directors.
If a quorum is present at the meeting, i.e. if a
majority of
the outstanding shares of Common
Stock are present or represented by valid proxy, the
nominees
for election as Directors who
receive the greatest number of votes cast at the meeting
by
shares present in person or by proxy
and entitled to vote thereon, shall be elected as Directors.
SCRMM has a slate of experienced and highly
qualified
nominees for the two Class III
Directors and the Class I Director to be elected to the
Board.
Each nominee named below has consented to serve
as a
director of DDL if elected. In the
event that a vacancy in the slate of nominees should occur
unexpectedly, the Shares voted for
that nominee as represented by the enclosed GREEN
Proxy
Card will be voted for a substitute
candidate selected by SCRMM.
The nominees have provided the following
information
concerning business address, age, and
principal occupation.
Name and Business Address<PAGE>
Principal Occupation for Past Five Years<PAGE>
Melvin Foster
Melvin Foster & Associates
15 Court Square
Boston, Massachusetts 02108<PAGE>
Attorney and Investor. Mr. Foster has been a
practicing attorney in
Boston, Massachusetts since 1971. Between 1951 and
1968, he
served as an operations executive of Robert Hall Clothes, a
subsidiary of United Merchant Manufacturers. He
received his
M.B.A. from Boston University in 1951, and his J.D. from
Boston
University in 1971. Mr. Foster is 68 years old, and a
shareholder in
DDL.<PAGE>
Don A. Raig
555 Saturn Boulevard
Suite B-444
San Diego, California 92154<PAGE>
Attorney, Trustee, and Investor.
Mr. Raig has been a
practicing
attorney since 1967, and established his practice in San
Diego,
California, in 1975. In addition to the oversight of
personal
investments and as a fiduciary, Mr. Raig has served as a
member of
the board of directors of a number of private companies.
Mr.
Raig is
53 years old, and a shareholder in DDL.<PAGE>
Robert G. Wilson
1620-1185 West Georgia Street
Vancouver, British Columbia
V6E 4E6 CANADA<PAGE>
Mr. Wilson has been engaged since 1990 in a private
business
consulting practice, which advises companies
experiencing
financial
and organizational difficulties. His consulting practice
focuses
on
planning, budget-setting, and general troubleshooting.
Previously,
Mr. Wilson was with the House of Seagrams a
publicly-held
company in Montreal, Quebec, as Assistant to the Vice
President
for
Finance (1968-70); from 1970 to 1979, Mr. Wilson built up
a
series
of four General Motors dealerships, five automobile
leasing and
rental companies, a heavy equipment leasing company,
and a
major
tire wholesaler and retailer; during this same period, he
held
interests
in an oil drilling company, an oil field equipment
company, and
other businesses; in 1987, Mr. Wilson was a principal in
the
start-up
of Brandover Enterprises, Ltd., a Seattle-based public
company
which produces and distributes beer in the United States
and
other
countries, and is listed on the Toronto Stock Exchange.
Mr.
Wilson
has served as a director of Malibu Grand Prix Corp.
(1984-91),
Pioneer Food Corp. (1990-91), Brandover Enterprises,
Ltd.
(1989-present), Amusements International, Ltd.
(1992-present),
Bonkers
Indoor Playgrounds, Inc. (1993-present), Interactive
Telesis, Inc.
(1993-95). Mr. Wilson is 53 years old, and a shareholder
in
DDL.
<PAGE>
None of the nominees has been convicted in a
criminal
proceeding (excluding traffic
violations or similar misdemeanors) during the past ten
years.
None of the nominees has been a
party to a civil proceeding of a judicial or administrative
body of
competent jurisdiction and as a
result of such proceeding was or is subject to a judgment,
decree
or final order enjoining further
violations of, or prohibiting activities subject to, federal or
state
securities laws or finding any
violation of such laws. Additional information concerning
those
nominees who own stock in
DDL is set forth in Appendix A hereto.
Five months ago, in January 1995, the chief
executive
officer of DDL entered into an
employment agreement with the Company which provides
for
substantial payments to be made
in the event of involuntary termination. In brief, the
agreement
calls for a lump sum payment
equal to one year's base salary, determined on the basis of
his
highest salary within three years
of termination, plus a bonus equal to the average of all
bonus
and incentive compensation for the
two years immediately preceding termination. In the
event that
SCRMM's nominees are elected
as Class I and Class III Directors, and in the event that
they
determine in their capacity as
Directors to fire the present chief executive officer, and if
this
portion of his employment
agreement is valid, then the Company may incur
substantial
costs pursuant to this severance
agreement. Similarly, if the chief operating officer or the
chief
financial officer were fired, and
the severance provisions of their respective employment
agreements are valid and applicable, the
Company may also incur substantial additional costs
pursuant
to these agreements.
Provided that a quorum is present, any vote to
ABSTAIN,
and any broker non-votes, on
Proposal No. 3 will have no effect on the election of
nominees as
Directors. Those Directors
receiving the greatest number of votes present or
represented by
valid proxy, and giving effect to
cumulative voting procedures, will be elected.
SCRMM urges you to sign, date and return the
enclosed
GREEN proxy card to vote for
the election of SCRMM's nominees as Directors.
VOTING OF PROXIES
Unless otherwise indicated, the persons named in
the
accompanying GREEN Proxy Card will
vote properly executed, dated, and duly returned proxies
(1)
FOR the election of Bernee D.L.
Strom and Erven Tallman as Class II Directors, (2) FOR
the
amendment of Bylaw 3.02 to set the
membership of the Board of Directors at not less than
seven,
effective immediately upon
adoption, and to require the immediate election of two
new
Class I members and one new Class
III member of the Board of Directors following adoption of
the
Bylaw amendment, (3) FOR the
election of Melvin Foster and Robert G. Wilson as Class I
members, and the election of Dan A.
Raig as a Class III member, of the Board of Directors, and
(4) in
accordance with their judgment
on such other business as may be properly presented to
the
meeting and any adjournment or
postponement thereof.
The Company's Bylaws provide for the election of
directors
by cumulative voting. Under
cumulative voting, each shareholder is entitled to (a) cast
a
number of votes equal to the number
of his or her shares multiplied by the number of directors
in
each class, and (b) to distribute such
votes among the nominees in that class or to vote for a
lesser
number, or a single nominee, as he
or she sees fit. If a shareholder wishes to distribute his or
her
votes in a specific manner, the
proxy card should be marked to indicate how the votes are
to be
distributed among the nominees.
If a shareholder strikes out the name of a Class I or Class
II
nominee, all the cumulative votes of
such shareholder will be voted FOR the remaining
nominee. If
no specific instructions are given
regarding the distribution of proxies, SCRMM's proxy
holders
will distribute the shares which
they are entitled to vote in favor of its nominees, in their
discretion.
By virtue of stock ownership, including beneficial
ownership, SCRMM holds sufficient
proxies to elect one Class I and one Class II Director (For
further information, see Appendix A).
However, at the present time, SCRMM has not considered
any
allocation by which it intends to
distribute votes among its nominees.
GREEN Proxy Cards should be signed, dated and
returned
in the postage-paid envelope
provided. Execution of the enclosed GREEN Proxy Card
will not
affect a shareholder's right to
attend the Annual Meeting and vote in person. A
shareholder
who has given a proxy may
revoke it at any time before such proxy is voted either by
a later
dated proxy or by voting
in person at the Annual Meeting. Attendance at the
Annual
Meeting will not in and of itself
constitute a revocation. If you were a shareholder on the
April
17, 1995, Record Date, you will
retain your voting rights in connection with the Annual
Meeting
even if you sell or sold such
Shares after the Record Date. Accordingly, it is
important that
you vote the Shares held by you
on the Record Date or grant a proxy to vote such Shares
whether
or not you still own the stock.
Shareholders cannot select Directors from among
those
proposed by DDL and SCRMM.
Therefore, if you wish to support SCRMM's nominees,
your last
dated, properly executed
proxy must be a GREEN Proxy Card.
YOUR INVESTMENT IS AT THE BOTTOM OF THE
BARREL.
WHO IS RESPONSIBLE?
Your DDL investment has hit the bottom of the
barrel and
stayed there. The majority of the
present Board of Directors and management team has
been in
control at DDL since January 1992
(approximately 3.5 years or 1,200 days). The stock's
performance during this period speaks for
itself no matter what criteria you would like to choose.
SCRMM has prepared an array of statistical and
graphical
data in order to assist you in
making an informed judgment regarding the stewardship
of
your company. The data is drawn
either from DDL's financial statements or from the
financial
database of Bridge Information
Systems. This data forms the basis for the tables and
charts
which follow; the actual tables and
charts were prepared by SCRMM, with verbal
authorization
from Bridge Information Systems
for the use of their data. The data is presented in two
forms and
requires some explanation:
1. DDL SPECIFIC DATA: Because DDL has had a
negative net worth, large write-offs,
significant asset sales, bond-to-stock conversions,
and
other non-recurring transactions, many
of the standard measures of financial performance
are not
relevant. Consequently, we have
focused on incontestable numbers such as revenues,
operating income, book value per share
and, course, stock price:
Table 1: Eight Standard Measurements of DDL's
Performance
While Under
Current Management
Year (Fiscal Year Ends June 30)
1992
1993
1994
1995
(9 mo)
Sales
58.5
57.9
48.5
22.7
Sales per Share
8.73
5.73
3.21
1.44
Operating Income ( 000,000)
(8.9)
(5.1)
(6.9)
(3.3)
Total Shares Outstanding ( 000)
6635
11973
14469
15909
Book Value per Share
(.92)
(.08)
(.34)
(.12)
Cash Flow per Share
(2.18)
(.12)
(.18)
N/A
Average Stock Price
1.3125
1.6875
1.4675
1.375
Average Daily Share Volume
15,900
42,000
31,800
15,800
_______________
Calendar year
The picture this data paints is one of a rapidly
shrinking
company but with an
increasing number of shares outstanding. Its
survival for
the last three years has
depended on the conversion of $12 million of bonds
into
common stock and the exercise
of $3,500,000 of warrants rather than any operating
successes.
2. DDL COMPARED TO PEER GROUPS: Because
DDL
does not exist in a vacuum, we
feel it is important to compare the performance of
DDL to
its peers. Bridge Information
Systems classifies companies into industry
segments.
DDL is classified in industry 255
(Electrical Components and Parts). Its peer group
consists
of approximately 30 firms that are
listed on the New York Stock Exchange and
approximately
50 that are traded on NASDAQ's
National Market System.
The peer groups appear to have done pretty well
over the
past three and one-half years.
Not so for DDL.
The graph below depicts the 10 year price movement
of
DDL stock compared to the DDL
peer groups. (Current outside members of the Board of
Directors have served on this Board
since 1986.) Notice the dramatic percentage rise in the
industry
stock prices since 1991. DDL's
percentage stock price change has not kept pace. The gap
between DDL and its peers has
widened as DDL continues to underperform its industry
peer
group even with a management
change at the end of 1991. This is not a record for DDL's
management to be proud of -- and it
certainly does not reflect a turnaround during the period
that
Mr. Cook has been Chief Executive
Officer.
Next, consider the graph of Quarterly Sales Growth
Compared to Prior Year. Again, we see
this alarming trend - the NYSE industry peer group
shows a
substantial and regular percentage
increase since 1992, while DDL's sales growth, after a
positive
trend in 1993, has dropped and
dropped and dropped dramatically since the beginning of
1994.
Finally, review the ranking of your company, DDL,
with its
peer group:
Measure
DDL
Ranking in Peer
Group
Median - 50% of
the Peer Group is
Above this Value
5 Year
Compounded
Revenue Growth
(Decline)Rate
- -17%
Bottom 4%
14.1%
Gross Profit
Margin
3.5%
Bottom 1%
24.5%
Average Daily
Trading Value -
Last 30 days
$189,750
Bottom 9%
$2,736,125
Absolute Stock
Price 4/21/95
1.375
Bottom 1%
13
Market
Capitalization
$22 million
Bottom 20%
$82 million
52-Week Stock
Price Change
22.2%
Top 45%
17.1%
26 Week Stock
Price Change
-26.7%
Bottom 7%
6.8%
Who is responsible for keeping DDL out of the bottom
of the
barrel? Who is
responsible for maintaining revenues and stock indices at
least
similar to the industry?
The Board of Directors and management are responsible.
It is
the Board of Directors'
responsibility to ensure that management performs.
WHAT DO YOU THINK OF THE JOB THEY HAVE
DONE
SO FAR?
The current Board of Directors and management (as a
team)
have watched over the
continuing abysmal performance of DDL for at least 3.5
years.
They have had almost 1200 days
to turn around DDL's performance and increase the value
of
your investment. Instead, they have
watched the average daily trading volume decline to
15,800,
from 42,000 in 1993, while the
number of outstanding shares more than doubled.
These pictures speak volumes.
While past results are never a certain indicator of
future
results, they are used by educated
men and women in their decision making process. The
past
results of the current Board of
Directors and their management team speak for
themselves.
WHAT DOES THE MARKET THINK?
In addition to these statistics, there is another
indicator of
the performance of the current
Board of Directors and their management team: the
market
itself. On a daily basis, buyers and
sellers come together to determine the value of assets
such as
your investment in DDL -- using
hard, cold cash, they vote on the prospects for the
company.
Over the past three and one-half
years, the market has voted on the prospects for DDL.
Their
vote places DDL's average share
price in the lowest one percent of its New York Stock
Exchange
peer group. We believe that the
market has voted thumbs down on the current Board of
Directors and their management team's
likelihood of success with our company.
We all should be concerned with the force of this
thumbs
down vote, echoed by the average
daily trading value of shares traded over the last thirty
days
which ranks us in the bottom ten
percent of peer group stocks traded. If the value of our
DDL
shares is to increase, there have to
be interested buyers in sufficient numbers to drive up the
share
price. We suggest that this low
share trading volume reflects investor's lack of interest in
and a
lack of confidence in the current
Board of Directors and their management team. If
investors had
any confidence in the potential
success of the present Board of Directors and their
management
team, then the stock we all own
would not be trading at its present levels.
We agree with the market. After working with this
current
management team, we have
lost confidence in their ability either to formulate or to
implement a sound strategic plan.
We have lost confidence that the current Board of
Directors or
its management team can
either identify the most promising and attractive
candidates or
follow through with the
consummation of a merger, acquisition or consolidation
which
will be beneficial to the
shareholders of DDL.
Take this opportunity, VOTE THIS PROXY and remove
the
current Board who is
responsible for the results depicted above.
WHAT IS SCRMM?
WHAT WILL SCRMM DO FOR YOU AND AT
WHAT
COST?
SCRMM is a group of your fellow shareholders who
have
banded together under the name of
the Shareholders' Committee to Remove a Moribund
Management ("SCRMM"). Collectively,
the members of SCRMM own, or beneficially own,
3,950,956
shares of Common Stock in DDL
Electronics, Inc., constituting 25.9 percent of the shares
entitled
to vote at the forthcoming
Annual Meeting scheduled for May 31. Of these,
members of
SCRMM, collectively, have sole
or shared voting power with respect to 1,939,585 shares,
and
sole or shared dispositive power
over 3,931,056 shares. For further information, see
Appendix A.
The members of SCRMM are not corporate gadflies.
We are
responsible business people and
investors with a unity of interests with you and most of
the
other shareholders in DDL. We want
DDL to be a successful company. We want the stock price
to go
up.
SCRMM is offering the shareholders the opportunity to
elect
a slate of Directors that will be
able to lead DDL in a new direction -- upward. We believe
that
the urgency of a change is
painfully obvious.
First ask, "What has SCRMM done for DDL to date?"
The
answer is enlightening - members
have helped keep DDL alive by providing cash and
converting
millions of dollars in corporate
bonds into stock. The impact of this group's involvement
is
telling. Look at the following chart
showing the price action of DDL, annotated with SCRMM
member's actions on behalf of DDL:
It is more than fair for you to ask "What exactly will
SCRMM do for me, a shareholder,
if it is successful in its efforts to remove those responsible
for the
mediocre and altogether
unimpressive performance of DDL over the past three and
one-half years?" Our agenda is as
follows:
1. We have put forward a slate of Directors with
substantial
business, corporate management,
legal and accounting experience, both domestic and
international, four of whom are
substantial shareholders in DDL. We believe that we
all
share a common interest -- an
increase in the value of DDL's stock.
2. Our slate of Directors will conduct an assessment of
DDL's
assets, liabilities and operating
position, seeking to generate an immediate increase in
corporate sales revenues and the
elimination of any non-productive corporate expenses.
3. Our slate of Directors will put in place a management
team
which will aggressively manage
DDL so that you have a chance to receive higher
returns on
your investment in DDL.
4. Our slate of Directors will work to restore credibility
and
develop a following for our
company among institutional investors, money
managers and
other professional investors so
that the price of your shares has a better opportunity
to
appreciate in value.
5. Our slate of Directors will reevaluate the lucrative
stock
option and restricted stock award
benefit plans put in place by the current Board of
Directors
and their management team and, if
they so determine, propose to stockholders that these
plans
be significantly modified or
terminated.
6. Our slate of Directors will employ their skills and the
skills
of other experts to utilize fully
our company's assets in a series of one or more
business
combinations which improve the
performance of DDL and the value of your shares of
stock.
7. As they develop and implement a new strategic plan,
our
slate of Directors will always place
your interests as shareholders first.
WHAT SPECIFIC STEPS ARE NECESSARY TO
CHANGE
CONTROL
OF DDL?
Preliminarily, you need to know that the Certificate of
Incorporation and Bylaws of DDL
provide for cumulative voting and staggered terms for its
Directors. The cumulative voting
provision permits each stockholder to multiply the
number of
Directors standing for election in
each Class by the number of shares of stock that he owns,
and
cast some or all of his votes for
any one or more of the Directors standing for election in
that
Class. The staggered terms for
Directors, sometimes referred to as a "classified" board,
means
that only a portion of the
Directors stand for election at any one time; in the case of
DDL,
there are three classes of
Directors with members of each class serving a three-year
term.
Staggered terms for Directors is a protective measure
designed to insulate corporate
management from the voting power of the shareholders.
A
classified Board is intended to make
it very difficult to effect a change in corporate control, i.e.
to
change a majority of the Board of
Directors. This may be true even in situations in which
the
stockholders represent a clear
majority of the outstanding stock of DDL.
In this instance, since there are four members on the
present
Board, and only two Directors
are standing for election this year, it is necessary for your
fellow
stockholders at SCRMM not
only to put forth its own slate of two Directors in
opposition to
the re-election of management's
two candidates but also to amend the Bylaws to expand
the
Board to seven members. If our
nominees are also elected to the three new seats on the
expanded Board, five of the seven
members of the Board of Directors will be new members.
A
majority of the Board of Directors
should have the power to set corporate policy and to guide
corporate management, including any
necessary changes in the current management team.
PROXY SOLICITATION; EXPENSES
Proxies may be solicited by members of SCRMM and
their
nominees by mail, telephone,
telecopier and personal solicitation. Regular employees of
Fortuna and Karen Brenner
Investment Advisor may be used to solicit proxies and, if
used,
will not receive additional
compensation for this work. Banks, broker houses and
other
custodians, nominees and
fiduciaries will be requested to forward the soliciting
matter of
SCRMM to their customers for
whom they hold shares, and SCRMM will reimburse them
for
their reasonable out-of-pocket
expenses.
SCRMM has retained Beacon Hill Partners, Inc., 90
Broad
Street, New York, New York,
10004, to assist in the solicitation of proxies. SCRMM has
agreed to pay Beacon Hill Partners,
Inc., a fee of up to $14,000, and to reimburse it for its
reasonable out-of-pocket expenses.
Approximately 15 people will be used by Beacon Hill
Partners,
Inc. in its solicitation efforts.
The entire expense of preparing, assembling, printing
and
mailing this Proxy Statement and
related materials, and the cost of soliciting proxies for the
proposals and nominees endorsed by
SCRMM, will be borne by SCRMM. SCRMM estimates
that its
total expenditures relating to
the solicitation will be approximately $75,000 (including
professional fees and expenses, but
excluding any costs represented by salaries and wages of
regular
employees of Fortuna and
Karen Brenner Investment Advisor); total expenditures to
date
have been approximately
$25,000. There is no written agreement or understanding
regarding the sharing of expenses by
the members of SCRMM. Most of the cost of this
solicitation is
being borne by Fortuna
Investment Partners and Richard Fechtor, because of
their
longstanding commitment of money
and professional reputation to DDL. The other members
of
SCRMM have shared in the
expenses on a more modest basis, by contributing
overhead and
personal professional time. If
successful in this proxy contest, SCRMM will seek
reimbursement from DDL for its actual,
documented expenses. SCRMM does not intend to seek
shareholder approval for such
reimbursement unless such approval is required under
Delaware law.
OTHER MATTERS ON THE ANNUAL MEETING
AGENDA
SCRMM is not aware of any other matters scheduled
to be
presented at the Annual Meeting.
If any other matters properly come before the meeting,
the
persons named in the enclosed
GREEN Proxy Card will have discretionary authority to
vote all
proxies with respect to such
matters in accordance with their judgment.
WHAT SHOULD YOU DO NEXT?
IT SHOULD BE OBVIOUS . . . JOIN US!
We strongly urge you to join us by (1) NOT returning
the
proxy cards sent to you by the
current Board of Directors of DDL and, more importantly,
by (2)
voting FOR the Shareholders'
slate of Director nominees by signing, dating, and mailing
the
enclosed GREEN Proxy Card
today. It is clearly time for a change.
We welcome you aboard and should you have any
questions
on when or how to vote your
shares, you should feel free to call our proxy solicitors at
1-800-755-5001.
Sincerely,
Your Fellow Shareholders at SCRMM
May 1, 1995
<PAGE>
APPENDIX A
The members of SCRMM are Karen Beth Brenner,
Richard
Fechtor, Don R. Raig, Ronald J. Vannuki,
and Fortuna Investment Partners, L.P. The discussion
below
presents the ownership, including beneficial
ownership as defined in Rule 13d-3 promulgated by the
Securities and Exchange Commission, of DDL
stock by members of SCRMM, as well as nominees for
election to
DDL's Board of Directors.
As of the date of this Proxy Statement, and consistent
with
the Rule 13d-3 definition of "beneficial
owner", members of SCRMM and nominees for the Board
of
Directors have the following interests in the
stock of DDL Electronics, Inc.:
1. Karen Beth Brenner is a registered investment
advisor at
1300 Bristol Street, Suite 100, Newport
Beach, California 92660, with limited discretionary
authority
over some clients' accounts. Karen Beth
Brenner has acquired a total of 16,400 shares of the
Common
Stock in transactions in four of her
retirement plans. Clients of Brenner Investment Adviser
purchased a total of 301,605 shares of the
Common Stock in a series of purchases for a total price of
$549,232.
In addition, clients of Brenner Investment Adviser
acquired
1,139,839 shares of the Common Stock
through bond conversion of DDL's convertible debt
securities in
December, 1992 and through exercise on
July 29, 1993 of stock warrants, which had been received
in the
conversion. The total cost of acquiring
these convertible securities and warrants (which were
converted
and exercised) was $1,300,024. The
sources of the funds for these purchases were other funds
in the
respective client's accounts, some of
which may have been derived from then recent sales of
other
securities.
Included in the above client group are immediate
family
members of Karen Brenner who have
acquired 309,053 shares of the Common Stock for a total
purchase price of $371,580. The source of the
funds for these purchases of the Common Stock were each
family member's private funds.
In summary, Brenner has sole voting power over
16,400
shares, and sole dispositive power over
1,441,444 shares.
2. Richard Fechtor is a registered representative and
director
of Fechtor, Detwiler & Co, Inc., 155
Federal Street, Boston, Massachusetts 02110, a securities
brokerage firm. Richard Fechtor acquired a total
of 443,050 shares (jointly held with spouse Pauline
Fechtor) in
transactions to his own account for which
he paid a total purchase price for these shares of
$450,000. The
source of the funds for these purchases of
the Common Stock were his private funds.
In addition, immediate family members of Richard
Fechtor,
but neither dependents nor living in his
household, acquired 132,500 shares of the Common Stock
for a
total purchase price of $181,000. The
source of the funds for these purchases of the Common
Stock
were each family member's private funds.
Fechtor has no power over the voting or disposition of
these
shares.
Clients of Richard Fechtor have acquired a total of
1,889,883
shares of the Common Stock in a series
of purchases for a total price of $3,307,295. Mr. Fechtor
does
not have voting or disposition authority
with respect to DDL shares in these accounts;
accordingly, this
stock is not included among the shares for
which Mr. Fechtor is considered to have beneficial
ownership.
Accordingly, Richard Fechtor has shared voting and
shared
dispositive power over 443,050 shares.
3. Don A. Raig is an attorney-at-law who practices at 555
Saturn Boulevard, Suite B-444, San Diego,
California 92154. Don A. Raig, as an individual, acquired
a total
of 46,965 shares of the Common Stock
(21,000 as a joint tenant with Colleen Buskirk) in
transactions
to his own account for a total price of
$85,110. The source of the funds for these purchases of
the
Common Stock were his private funds.
Don A. Raig, as the trustee of four private trusts, has
also
acquired with funds from said trusts a total
of 473,010 shares of Common Stock for an aggregate
purchase
price of $742,628.
Accordingly, Raig has sole voting and sole dispositive
power
over 519,975 shares.
4. Ronald J. Vannuki is a registered representative at
Strome
Susskind Securities, L.P., 100 Wilshire
Boulevard, Fifteenth Floor, Santa Monica, California
90401.
Mr. Vannuki is also president of Fortuna
Capital Management, Inc., a California corporation
located at
the same address, and general partner of
Fortuna Investment Partners, L.P. ("Fortuna"). Fortuna,
in the
course of its business, used a total of
$1,414,775 of its working capital to acquire 956,660
shares of
the Common Stock in several separate
transactions.
Ronald J. Vannuki acquired a total of 3,500 (1,500 as
custodian for his minor son Randon Vannuki)
shares of the Common Stock for which he paid $5,244.
The
source of the funds for Mr. Vannuki's
purchases of the Common Stock were funds in his IRA
and
private funds. Mr. Vannuki has discretionary
dispositive authority with respect to a client's account
which
owns 566,427 shares, purchased for an
aggregate price of $509,784. The client's stock was
purchased
with the clients personal funds.
In addition, an immediate family member of Ronald J.
Vannuki acquired 15,150 shares of the
Common Stock for a total purchase price of $18,938. The
source
of the funds for this purchase was the
private funds of the family member, who does not reside
in the
same household. Mr. Vannuki has no
voting or dispositive power over these shares.
Clients of Mr. Vannuki's former brokerage firm, Drake
Capital Securities, Inc., own 1,241,227 shares
of the Common Stock which were purchased for the
aggregate
sum of $1,696,866. Mr. Vannuki has no
voting or disposition authority over these shares and none
of
theses shares is included among those for
which Mr. Vannuki is considered to have beneficial
ownership.
Accordingly, Fortuna Investment Partners has sole
voting
and dispositive power over 956,660 shares.
Mr. Vannuki has sole voting power over 3,500 shares and
sole
dispositive power over 569,927 shares.
5. Melvin Foster is a lawyer in Boston, Massachusetts.
Mr.
Foster owns 113,000 shares of Common
Stock, acquired in a series of purchases totalling
$169,500.
Additionally, Mr. Foster owns 51,500 shares
in a profit-sharing plan, and 10,000 shares in a Keough
Plan,
purchased for an aggregate price of $92,250.
Mr. Foster, as custodian for his minor son, is the
beneficial
owner of 13,000 shares purchased for
$19,500.
Mr. Foster has sole voting and sole dispositive power
over
187,500 shares. .
6. Erven Tallman is a businessman of diverse interests
living
in Rancho Mirage, California. Mr. Tallman
owns 152,732 shares of stock, acquired in a series of
purchases
totalling $229,098. Accordingly, Mr.
Tallman has sole voting and sole dispositive power over
152,732
shares.
7. Robert G. Wilson is a businessman of diverse interests
living
in Vancouver, British Columbia. Mr.
Wilson owns 566,427 shares of stock in a discretionary
brokerage account, acquired in a series of
purchases totalling $849,641. Mr. Wilson has sole voting
and
shared dispositive power over 566,427
shares.
<PAGE>
The table below sets forth all Shares purchased or sold
by
members of SCRMM or nominees for the
Board of Directors within the past two years, the dates on
which
such purchases were made, and the
amount of such purchases.
Purchases and Sales of DDL Electronics, Inc. During the
Last
Two Years.
Date
Purchased
Number of
Shares
Total
Cost
Fortuna Investment Partners, L. P.
20-Apr-93
175,000
$245,875
20-Apr-93
189,580
$351,745
20-May-93
1,000
$2,040
20-May-93
500
$988
21-May-93
500
$963
21-May-93
800
$1,565
25-May-93
2,000
$3,875
16-Jul-93
20,040
$54,593
01-Sep-93
6,200
$11,960
03-Sep-93
200
$435
03-Sep-93
9,100
$17,452
08-Sep-93
100
$248
09-Sep-93
600
$1,180
10-Sep-93
20,000
$40,625
21-Sep-93
1,000
$1,810
22-Sep-93
9,000
$16,045
30-Sep-93
6,400
$11,417
18-Oct-93
20,000
$33,125
20-Oct-93
200
$360
22-Oct-93
900
$1,402
22-Oct-93
16,740
$25,637
03-Nov-93
3,000
$4,615
04-Nov-93
2,900
$4,462
04-Nov-93
3,000
$4,615
09-Nov-93
8,600
$12,108
17-Nov-93
5,000
$7,050
18-Nov-93
1,000
$1,430
19-Nov-93
3,600
$4,633
30-Nov-93
46,400
$59,417
14-Dec-93
5,000
$6,425
22-Dec-93
5,400
$6,262
29-Dec-93
23,500
$33,043
30-Dec-93
6,500
$9,158
31-Dec-93
500
$790
31-Dec-93
1,500
$2,133
31-Dec-93
2,200
$3,116
29-Apr-94
5,000
$6,400
29-Apr-94
5,000
$5,775
13-May-94
25,000
$21,063
13-May-94
65,000
$58,825
18-May-94
13,000
$12,578
18-May-94
5,000
$5,150
19-May-94
20,000
$20,600
20-May-94
5,000
$5,150
23-May-94
10,000
$10,300
26-May-94
1,500
$1,451
27-May-94
1,000
$968
27-May-94
5,000
$5,775
27-May-94
14,000
$14,420
24-Jun-94
2,000
$2,310
24-Jun-94
6,000
$6,180
24-Jun-94
10,000
$9,675
03-Jan-95
27,800
$42,534
12-Jan-95
20,000
$33,100
17-Jan-95
2,400
$3,372
19-Jan-95
15,000
$21,950
19-Jan-95
35,000
$53,550
28-Mar-95
15,000
$19,200
29-Mar-95
10,000
$14,050
30-Mar-95
21,600
$30,348
31-Mar-95
20,000
$28,100
Vannuki, Clients
30-Jul-93
113,133
$254,549
Fechtor Family
19-Apr-93
45,000
$59,061
23-Apr-93
75,000
$131,250
21-May-93
11,000
$5,500
18-Jul-93
3,000
$2,280
21-Jul-93
1,000
$625
29-Dec-93
2,000
$3,030
31-Dec-93
10,000
$13,834
31-Mar-94
14,500
$18,926
31-May-94
1,000
$1,030
Raig
08-Aug-94
249,375
$374,063
18-Aug-94
7,000
$10,500
02-Oct-94
5,000
$10,625
17-Oct-94
9,000
$17,750
20-Oct-94
32,500
$68,563
21-Oct-94
3,000
$6,375
26-Oct-94
8,000
$16,625
01-Nov-94
32,700
$68,525
02-Nov-94
28,800
$61,200
18-Nov-94
5,000
$8,750
20-Nov-94
13,000
$27,625
21-Nov-94
13,500
$23,188
22-Nov-94
5,000
$8,125
23-Nov-94
5,000
$8,125
25-Nov-94
5,000
$7,500
28-Nov-94
10,000
$14,375
29-Nov-94
5,000
$6,875
16-Dec-94
10,000
$1,250
19-Dec-94
5,000
$6,250
29-Dec-94
8,100
$10,988
30-Dec-94
10,000
$13,750
21-Mar-95
30,500
$34,313
22-Mar-95
4,200
$4,988
24-Mar-95
15,300
$17,413
Brenner, Clients
21-Apr-93
800
$1,050
21-Apr-93
400
$537
06-May-93
16,670
$25,005
07-May-93
34,080
$25,500
28-May-93
40,440
$75,827
23-Jun-93
20,000
$45,000
23-Jun-93
12,800
$24,000
30-Jun-93
2,000
$4,502
30-Jun-93
2,000
$4,502
30-Jun-93
2,000
$4,502
30-Jun-93
10,000
$22,502
27-Jul-93
3,000
$3,060
29-Jul-93
33,340
$50,001
29-Jul-93
50,010
$75,015
11-Aug-93
16,670
$25,005
11-Aug-93
2,500
$5,940
11-Aug-93
2,500
$5,940
11-Aug-93
19,233
$28,850
11-Aug-93
60,012
$90,018
11-Aug-93
3,334
$5,001
30-Aug-93
30,000
$67,502
31-Aug-93
5,000
$11,252
01-Sep-93
1,500
$2,888
03-Sep-93
500
$1,063
10-Sep-93
2,500
$5,002
13-Sep-93
2,500
$5,002
29-Sep-93
10,000
$18,752
30-Sep-93
95,000
$178,125
01-Oct-93
26,700
$50,332
07-Oct-93
5,000
$9,035
07-Oct-93
5,000
$9,035
26-Oct-93
5,000
$7,702
29-Oct-93
52,000
$84,502
01-Nov-93
25,000
$41,877
29-Nov-93
60,000
$75,602
03-Dec-93
26,000
$36,012
21-Dec-93
58,000
$80,332
29-Dec-93
9,000
$9,565
26-Apr-94
2,000
$2,252
26-Apr-94
2,000
$2,252
07-Jul-94
27,000
$40,652
25-Aug-94
4,500
$6,240
25-Aug-94
4,500
$6,240
22-Nov-94
55,000
$87,658
Dates
Sold
Number of
Shares
Total
Proceeds
Vannuki, Clients
20-Apr-93
185,000
$235,373
28-Apr-93
30,000
$56,248
23-Jun-93
120,000
$266,248
14-Jul-93
15,000
$31,873
08-Sep-93
20,000
$39,598
09-Sep-93
30,000
$60,000
14-Sep-93
20,000
$39,080
17-Sep-93
10,000
$18,748
23-Sep-93
2,000
$3,748
22-Sep-93
10,000
$18,123
29-Sep-93
45,300
$83,685
04-Oct-93
12,200
$22,804
20-Oct-93
1,800
$3,694
25-Oct-93
16,000
$26,000
Fechtor Family
05-Aug-94
5,000
$7,456
09-Aug-94
1,000
$1,469
Brenner, Clients
19-Apr-94
4,000
$3,998
14-Jul-94
27,000
$40,347
18-Aug-94
4,000
$5,477
18-Aug-94
5,000
$6,846
13-Sep-94
500
$840
13-Sep-94
2,000
$3,359
13-Sep-94
1,500
$2,519
25-Oct-94
12,800
$23,001
25-Oct-94
9,000
$16,173
25-Oct-94
1,000
$1,797
28-Oct-94
25,000
$49,998
04-Nov-94
25,000
$49,998
06-Jan-95
55,000
$89,373
As of the date of this Proxy Statement, May 1, 1995,
no
shares have been purchased after the Record
Date.
Except as otherwise set forth in this Appendix A,
neither
SCRMM nor any of its members nor any
"associate" of any of the foregoing persons or any other
person
who may be deemed a "participant" in the
Proxy Solicitation is the beneficial or record owner of any
Shares. Except as otherwise set forth in this
Appendix A, neither SCRMM nor any of its members nor
any
"associate" of any of the foregoing persons
or any other person who may be deemed a "participant" in
the
Proxy Solicitation has purchased or sold
any Shares within the past two years, borrowed any funds
for
the purpose of acquiring or holding any
Shares or is or was within the past year a party to any
contract
or arrangement or understanding with any
person with respect to any Shares. There has not been
any
transaction since the beginning of DDL's last
fiscal year, and there is not currently any proposed
transaction
to which DDL is a party, in which
SCRMM or any of its members or any "associate" or
immediate
family member of any of the foregoing
persons or any other person who may be deemed a
"participant"
in the Proxy Solicitation had or will have
a direct material interest including, without limitation,
any
understanding with respect to future
employment or any future transaction to which the
registrant or
any of its affiliates is a party.<PAGE>
[ Back Page ]
IMPORTANT
Your vote is important. No matter how many or
how few
DDL shares you own, please vote FOR the
Committee's nominees by signing, dating and mailing the
enclosed GREEN Proxy Card today. SCRMM
urges you NOT to return any proxy cards sent to you by
the
Board of Directors of DDL.
If you have already returned a Board of Directors'
proxy
card before receiving this Proxy Statement, you
have every right to change your vote by signing and
returning
the enclosed GREEN Proxy Card. Only your
latest dated, properly executed proxy will count at the
Annual
Meeting.
If you own your DDL Shares in the name of a
brokerage
firm, your broker cannot vote such Shares unless
he receives your specific instructions. Please sign, date
and
return the enclosed GREEN Proxy Card in the
postage-paid envelope that has been provided.
If you have any questions about how to vote your
DDL
shares, please call our proxy solicitor:
Beacon Hill Partners
90 Broad Street
New York, NY 10004
Telephone: 1-800-755-5001
<PAGE>
APPENDIX B
PROXY CARD
THIS PROXY IS BEING SOLICITED ON BEHALF
OF
THE
SHAREHOLDER COMMITTEE TO REMOVE A
MORIBUND MANAGEMENT
DDL ELECTRONICS, INC.
ANNUAL MEETING OF SHAREHOLDERS, MAY
31,
1995
The undersigned, revoking all proxies heretofore given,
hereby
appoints Karen Beth Brenner, Richard
Fechtor and Ronald J. Vannuki as Proxies (each of them
with
full power to act without the other), each
with the power to appoint his substitute, and hereby
authorizes
them to represent and to vote, as
designated below, the proposals which are more fully set
forth in
the Proxy Statement of the DDL
Shareholders Committee to Remove A Moribund
Management
(receipt of which is hereby acknowledged)
all shares of Common Stock of DDL Electronics, Inc. (the
"Company") held of record by the undersigned
on April 17 at the Annual Meeting of Shareholders to be
held on
May 31, 1995, or at any adjournment or
postponement thereof.
DDL SHAREHOLDERS COMMITTEE TO REMOVE A
MORIBUND MANAGEMENT ("SCRMM")
RECOMMENDS A VOTE "FOR" EACH OF THE
PROPOSALS
LISTED BELOW
1. Election of Class II Directors to continue in office until
1997
_____ FOR electing the nominees listed below, subject to
the
right of the Proxies, in their discretion, to
cumulate votes (except as marked to the contrary
below).
_____ WITHHOLD AUTHORITY to vote for all
nominees
listed below.
SCRMM Class II Nominees: Bernee D. L. Strom and
Erven
Tallman.
(Instruction -- to withhold authority to vote for any
individual
nominee, write that nominee's name on the
line below)
____________________________________________
2. Amendment of Section 3.02 of the Bylaws to set the
membership of the Board of Directors at not less
than seven (7), effective immediately upon adoption:
_____ FOR _____ AGAINST _____ ABSTAIN
3. Assuming the adoption of Proposal No. 2, the election
of two
new Class I Directors to continue in
office until 1996, and one new Class III Director to
continue in
office until 1995.
._____ FOR electing the nominees listed below, subject to
the
right of the Proxies, in their discretion, to
cumulate votes (except as marked to the contrary
below).
_____ WITHHOLD AUTHORITY to vote for all
nominees
listed below.
SCRMM Class I Nominees: Melvin Foster and Robert G.
Wilson
SCRMM Class III Nominee: Don A. Raig.
(Instruction -- to withhold authority to vote for any
individual
nominee, write that nominee's name on the
line below)
____________________________________________
This proxy, when properly executed, will be voted in the
manner
directed by the undersigned
shareholder(s). If no direction is made, this proxy will be
voted
FOR each of the listed proposals and
nominees. In their discretion, the Proxies are authorized
to vote
upon such other matters as may come
before the meeting or any adjournment thereof.
Date:____________________, 1995
X_________________________
X_________________________
Signature of Shareholder(s)
Please sign exactly as your name appears. For shares in
the
name of more than one person, each holder
should sign. When signing as attorney, administrator,
executor,
guardian, trustee, or custodian, please
write in your full title as such. If signing as a corporation,
please indicate the signer's title.
