DBA SYSTEMS, INC.
1200 SOUTH WOODY BURKE ROAD
P.O. BOX 550
MELBOURNE, FLORIDA 32902-0550
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
November 13, 1996
Notice is hereby given that the Annual Meeting of Shareholders
(the "Meeting") of DBA Systems, Inc. (the "Company"), a Florida corporation,
will be held at the DBA Conference Facility, Granada Center, 1101 W. Hibiscus
Blvd., Melbourne, Florida on November 13, 1996 at 1:00 p.m., local time, for
the purpose of considering and acting upon the following matters:
1. To elect two Class I Directors and one Class III Director.
2. To approve the selection of Deloitte & Touche LLP, Orlando, Florida as
the Company's Independent Certified Public Accountants for the 1997
fiscal year.
3. To consider and act upon any other matters which may properly come
before the Meeting and any adjournments thereof.
The Board of Directors has fixed the close of business on September 27, 1996
as the record date for determination of shareholders entitled to notice of
and to vote at the Meeting or any adjournments thereof. On September 27,
1996, the Company had outstanding 4,483,038 shares of common stock, par
value $.10 per share (excluding treasury stock). The transfer books of the
Company will not be closed.
SHAREHOLDERS ARE URGED TO FILL IN, DATE, SIGN AND PROMPTLY
RETURN THE ENCLOSED PROXY IN THE ENCLOSED PREPAID
ENVELOPE. It is desirable that as many shareholders as possible be
represented at the Meeting. Consequently, whether or not you now expect to
be present, please execute and return the enclosed Proxy. You have the power
to revoke your Proxy at any time before it is voted, and the giving of a
Proxy will not affect your right to vote in person if you attend the Meeting.
By Order of the Board of Directors,
_______________________
(signature)
John L. Slack
Chairman of the Board, President,
Chief Executive Officer and
Treasurer, Acting
October 11, 1996
<PAGE>COVER
PROXY STATEMENT
INTRODUCTION
This Proxy Statement is furnished to shareholders of DBA Systems, Inc., a
Florida corporation (the "Company" or "DBA"), in connection with the
solicitation, on behalf of the Company's Board of Directors, of proxies to
be used at the Annual Meeting of Shareholders (the "Meeting") to be held at
the DBA Conference Facility, Granada Center, 1101 W. Hibiscus Blvd.,
Melbourne, Florida at 1:00 p.m. on November 13, 1996, and at any adjournments
thereof. The Notice of Annual Meeting, Proxy Statement and form of Proxy
are first being sent to shareholders on or about October 11, 1996.
Your proxy is solicited on behalf of the Board of Directors. The cost of
solicitation of proxies, including the cost of preparing and mailing the
Notice of Annual Meeting, Proxy Statement and form of Proxy, will be borne
by the Company. Employees of the Company, at no additional compensation,
may communicate with shareholders to solicit their proxies. The Company
does not intend to use specially engaged employees of the Company, or other
paid solicitors, in the solicitation of proxies. Brokers and others holding
stock in their names, or in the names of nominees, may be requested to
forward copies of the proxy soliciting material to beneficial owners and to
seek authority for execution of proxies; the Company will reimburse those
persons for their reasonable out-of-pocket expenses.
Enclosed is an Annual Report to shareholders for the fiscal year ending
June 30, 1996, which contains financial and other information pertaining to
the Company. The Annual Report is not part of the proxy soliciting material.
The Meeting has been called for the purpose of considering and acting upon
the following matters:
1. To elect two Class I Directors and one Class III Director.
2. To approve the selection of Deloitte & Touche LLP, Orlando, Florida as
the Company's Independent Certified Public Accountants for the 1997
fiscal year.
3. To consider and act upon any other matters which may properly come
before the Meeting and any adjournments thereof.
Voting rights are vested exclusively in the holders of the Company's
common stock ("Common Stock"), with each share entitled to one vote on each
matter coming before the Meeting. Only shareholders of record as of the
close of business on September 27, 1996 will be entitled to receive notice
of and to vote at the Meeting. On the record date, the Company had 4,483,038
outstanding shares of Common Stock, excluding treasury shares.
The presence, in person or by proxy, of a majority of shares entitled to vote
shall constitute a quorum. Assuming that a quorum is present or represented
at the Meeting, the vote of a plurality of the shares present or represented
at the Meeting will be required for the election of a director, and the vote
of a majority of the shares present or represented at the Meeting will be
required for approval of all other matters listed above. For purposes of
determining the number of votes cast with respect to any matter, only those
cast "for" or "against" are included. Abstentions and broker non-votes are
counted only for purposes of determining whether a quorum is present at the
Meeting.
<PAGE>1
The enclosed proxy, solicited on behalf of the Board of Directors, if
properly executed and not revoked, will be voted at the Meeting and where a
specification is made therein, will be voted in accordance with such
specification. The proxy may be revoked prior to the exercise of the powers
conferred by the proxy by filing with the Secretary of the Company an
instrument revoking it, by duly executing a proxy bearing a later date or
by attending the Meeting and personally voting.
ELECTION OF DIRECTORS
The Company's Articles of Incorporation provide that the Board of Directors
consists of three classes elected for three-year terms on a staggered basis,
with approximately one-third of the total number of directors being elected
at each Annual Meeting. Pursuant to these requirements, the Board of
Directors has nominated two individuals to serve as Class I Directors.
The two Class I nominees receiving the greatest number of votes cast by the
holders of Common Stock will be elected as directors for a term of three
years. The individuals elected will continue to serve until a successor is
elected and qualified or his term of office shall have been otherwise
terminated as provided by the Bylaws. The enclosed proxy cannot be voted for
a greater number of persons than the number of nominees named herein.
If for any reason the nominees shall become unavailable for election, the
proxy will be voted for nominees selected by the Board of Directors. The
Company knows of no reason why the nominees will not be available for
election.
NOMINEES FOR ELECTION TO THE BOARD OF DIRECTORS
Common Term
Stock % of of
Year Beneficially Outstanding Office
Principal Became a Owned as of Common (in
Name Age Occupation Director 8/30/96(1) Stock years)(2)
CLASS I
Dr. Richard N. 59 President and 1993 10,200 .23% 3
Baney CEO, Health First
Physicians, Inc.
Mr. William C. 55 President, 1981 6,633(3) .15%
3
Potter Potter, McClelland,
Marks & Healy, P.A.
CLASS III
Mr. Thomas J 63 International 1996 1
Boyce, Jr. Banking
Consultant
<PAGE>2
CONTINUING DIRECTORS
Common
Term
Stock % of of
Year Beneficially Outstanding Office
Principal Became a Owned as of Common (in
Name Age Occupation Director 8/30/96(1) Stock years)(2)
CLASS II
Mr. John L. Slack 58 Chairman, 1989 230,758(4) 5.04%
2
of the Board
President and
Chief Executive
Officer of the Company
Dr. Joseph A. Boyd 75 Chairman 1989 6,000 5 .13% 2
and CEO Fairchild
Controls Corporation
Amb. Robert F. 70 International 1989 10,000(6) .22% 2
Ellsworth Consultant
CLASS III
Dr. Lynn E. Weaver 66 President, 1989 6,000(7) .13%
1
Florida Institute
of Technology
(Florida Tech)
1 Unless otherwise indicated in the following notes, the persons herein
have sole voting and investing power with respect to shares shown as
being beneficially owned by them.
2 All directors are elected for three year terms, except Mr. Boyce who is
filling the Board position held by Dr. Tordella. The years set forth next
to Class II and Class III Directors represent the remaining term of office.
3 Includes options for 5,000 shares.
4 Includes options for 92,000 shares. Also includes 512 shares issuable
upon conversion of $10,000 principal amount of the Company's 8 1/4%
Convertible Subordinated Debentures due 2010 and 1,296 shares held in
trust by the DBA Systems Employee Stock Ownership Plan and Trust.
Excludes 3,000 shares owned by Mr. Slack's wife as to which shares he
disclaims any beneficial interest and options for 25,000 shares
exercisable in the event the Company is sold during Mr. Slack's tenure as
President upon terms and price acceptable to the stockholders of the
Company.
5 Includes options for 5,000 shares.
6 Includes options for 5,000 shares.
7 Includes options for 5,000 shares.
<PAGE>3
DIRECTORS' BACKGROUND AND EXPERIENCE
NOMINEES FOR ELECTION
CLASS I
DR. RICHARD N. BANEY is President and CEO of Health First Physicians, Inc., a
primary care medical group based in Melbourne, FL. He is a trustee of
Florida Tech and a director of The Bank Brevard. He was a founding director
and chairman of Reliance Bank of Florida from 1985 to 1995. Dr. Baney
attended Georgetown University, Washington, D.C. and the University of
Pittsburgh School of Medicine. He served as a medical officer in the U.S.
Navy from 1964 to 1967.
MR. WILLIAM C. POTTER is President of Potter, McClelland, Marks & Healy,
P.A., a law firm, which was founded in November 1986 and is legal counsel to
the Company. He is a graduate of Brown University and the University of
Michigan Law School. Mr. Potter is a member of the Advisory Board of First
Union National Bank of Florida. Mr. Potter also serves as Chairman of the
Board of Trustees of Florida Tech and is counsel for the Melbourne Airport
Authority. Mr. Potter holds the rank of Colonel in the U.S. Air Force Reserves.
CLASS III
MR. THOMAS J. BOYCE, JR. served until 1995 as the President of Sauqatuck
Securities Ltd., a private investment bank. He also served as the President
of Refco, an international financial services firm, and as a consultant to
the Quaker Oats Co. He was the CFO for Beatrice Foods Co., an international
diversified conglomerate. Mr. Boyce is a former member of the Boards of
Directors for Ward Foods Inc., Refco Securities Inc., Chamberlain
Manufacturing Co., Cape Canaveral Hospital Foundation, and Buena Vida
Retirement Community. As a director of Chamberlain Manufacturing Co. for
ten years he worked closely with the CEO to diversify the profitable defense
contractor into consumer products. Mr. Boyce holds a B.A. in Economics from
La Salle University and an M.B.A. in Finance from the Harvard Business
School and has performed post-graduate studies at Stanford University.
<PAGE>4
CONTINUING DIRECTORS
MR. JOHN L. SLACK is Chairman of the Board, President and Chief Executive
Officer of the Company. He was Deputy Assistant Secretary of Defense for
Intelligence between 1975 and 1977. From 1977 until he formed his own
consulting business in 1979, Mr. Slack was Vice President of Martin Marietta
Aerospace Corporation. Since 1979, he has acted as consultant to such
clients as the Congress of the United States (Appropriations Committee), the
Department of Defense, and the U.S. Air Force Deputy Chief of Staff on
defense-related technology matters. From October 1985 through August 1989,
Mr. Slack was President and a director of ARDAK Corporation, a company which
builds inexpensive space systems and supports major aerospace companies in
strategic planning. Mr. Slack is currently a director of ARDAK Corporation
and CTA Corporation. Mr. Slack is certified as an engineer, a
cryptomathematician, a data systems analyst and a signals analyst. He is a
recipient of the DoD Distinguished Civilian Service Medal and the Joint
Services Commendation Medal. Mr. Slack was elected as the President and
Chief Executive Officer of DBA Systems, Inc. in August 1989 and Chairman of
the Board of Directors in February 1990. Mr. Slack assumed the duties of
Acting Treasurer on May 15, 1994, with the departure of Mr. William R.
LeMasters, Vice President of Finance, from the Company. All other financial
duties have been delegated to the Corporate Controller.
DR. JOSEPH A. BOYD is Chairman and Chief Executive Officer of Fairchild
Controls Corporation. He was Chairman and Chief Executive Officer of
Fairchild Space & Defense Corporation and a member of its board of directors
from 1989 to 1994. Dr. Boyd was a director of Harris Corporation from 1967
until he retired from its board of directors in March 1993 and was Chief
Executive Officer from 1978 to 1986 and Chairman from 1978 to 1987. Prior
to his employment with Harris, Dr. Boyd was president of Radiation, Inc.
from 1962 to 1967. He was director of the Institute of Science and
Technology, University of Michigan, after serving as a director of the
University's Willow Run Laboratories. Dr. Boyd was a member of the
Electrical Engineering Faculty, University of Michigan, from 1949 to 1962.
He is a Fellow of the University of Kentucky and a Fellow of the Institute
of Electrical and Electronic Engineers.
AMBASSADOR ROBERT F. ELLSWORTH is President of Robert Ellsworth & Co.,
Inc., an investment and consulting firm; President and Chief Executive
Officer of The Sokol Group; and a director of Price Communications
Corporation, New York City; and of Voice Compression Technology, Inc.,
Greenwich, CT. He served three terms as a member of Congress from 1961 to
1967. He was U.S. Ambassador to NATO from 1969 to 1971, a general partner
with Lazard Freres & Co. from 1971 to 1974, Assistant Secretary of Defense
from 1974 to 1975 and Deputy Secretary of Defense from 1975 to 1977.
Mr. Ellsworth is also a member of various professional societies including
the International Institute for Strategic Studies in London (of which he
is Chairman), the Atlantic Council of the U.S. in Washington, and the
Council on Foreign Relations in New York.
DR. LYNN E. WEAVER is President of the Florida Institute of Technology (Florida
Tech), Melbourne, Fl. Prior to his appointment at Florida Tech, Dr. Weaver
served in senior academic administrative positions including Department Head,
University of Arizona; Associate Dean, University of Oklahoma; School
Director, Georgia Institute of Technology; and Dean, Auburn University.
He has held offices in a number of national professional organizations and
is a Fellow of the American Nuclear Society. Dr. Weaver is a Registered
Professional Engineer and received his Bachelor's degree in Electrical
Engineering from the University of Missouri, a Master's degree in Electrical
Engineering from Southern Methodist University and his Ph.D. from
Purdue University.
<PAGE>5
COMMITTEES OF THE BOARD
The standing committees established by the Board of Directors to assist in
the discharge of its responsibilities are described in the paragraphs below.
Committee membership is reported as of the Company's fiscal year ended June
30, 1996.
The Executive Committee consisted of three members: Mr. John L. Slack,
Chairman; Dr. Joseph A. Boyd; and Mr. William C. Potter. When the Board of
Directors is not in session, the committee has the power to direct and
manage the business and affairs of the Company in cases for which specific
directions have not been given by the Board of Directors. The committee met
three times in fiscal year 1996.
The Audit Committee consisted of four members: Mr. William C. Potter,
Chairman; Dr. Richard N. Baney; Dr. Lynn E. Weaver and prior to his death
Dr. Louis W. Tordella. The committee meets with financial management and
the Company's independent public accountants to review the work of each and
to ensure that each is properly discharging its respective responsibilities.
The independent public accountants have free access to the Audit Committee
without management representatives present to discuss the results of their
examination and their opinions on the adequacy of internal controls and
quality of financial reporting. The committee recommends to the Board of
Directors the selection of the firm of independent public accountants to
audit the books and accounts of the Company. The committee met one time in
fiscal year 1996.
The Compensation Committee consisted of four members: Amb. Robert F. Ellsworth,
Chairman; Dr. Richard N. Baney; Dr. Lynn E. Weaver and prior to his death
Dr. Louis W. Tordella. The committee recommends salaries of the Chairman of
the Board, Chief Executive Officer and the non-wage benefits and perquisites
for officers and key employees. It also oversees the overall compensation
structure for all employees. The committee met one time in fiscal year 1996.
The Corporate Technology Committee consisted of five members: Dr. Lynn E.
Weaver, Chairman; Dr. Richard N. Baney; Dr. Joseph A. Boyd; Dr. Louis W.
Tordella and Mr. John L. Slack. The Corporate Development Committee reviews
and approves the strategic business plans of the Company as well as
considering potential merger/acquisition opportunities. The committee did
not meet fiscal year 1996.
The Finance Committee consisted of three members: Amb. Robert F. Ellsworth,
Chairman; Dr. Joseph A. Boyd; and Mr. William C. Potter. The Finance
Committee reviews and approves the proposed budgets for the Company as well
as overseeing the financing and banking relationships of the Company. The
committee did not meet in fiscal year 1996.
During fiscal year 1996 the Board of Directors had four regular meetings.
All directors attended 75 percent of the meetings of the Board of Directors
and the committees of which they were members. The Company has no nominating
committee.
<PAGE>6
EXECUTIVE COMPENSATION
REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE
COMPENSATION
Overview
The Compensation Committee of the Board of Directors is composed of three of
the Company's five outside directors and is responsible for setting and
administering policies that govern executive compensation and stock option
programs.
The Company has an executive compensation package that is driven by the
overall performance of the Company and the individual performance of the
executive. The measures of the Company's performance include revenues, new
business bookings and net income.
Form of Compensation
DBA provides its executive officers with a compensation package consisting of
base salary and variable incentive pay. In setting total compensation, the
committee considers individual and Company performances as well as market
information in the form of published survey data. The market data consists
primarily of base salary and total cash compensation rates, as well as
incentive bonus and stock programs, set forth in the Executive Compensation
in the Electronics Industry survey as published by the American Electronics
Association.
Specific executive compensation elements are:
. Base salary. Base salary ranges are reviewed annually using published
salary survey data from the survey referenced above. Salary increases
are awarded annually based on the committee's evaluation of the individual
performance, as well as market-competitive considerations.
. Bonus plan. The Company's bonus plan provides a short-term incentive, in
the form of a bonus, that varies according to the Company's achievement of
revenues, new business bookings and after tax profit goals set by the
Board of Directors. This plan will effectively pay executives at or above
market when a high level of corporate performance and shareholder value is
achieved, and less than market when results are below expectations. If
less than 100% of budgeted goals are achieved, no bonus is paid. This
effectively puts a significant amount of cash compensation at risk,
dependent on achievement of budget goals.
. Long term incentives. Longer term incentives are provided through a stock
option plan, with options generally vesting over three years, which
rewards executives through growth in value of the common stock.
<PAGE>7
Fiscal Year 1996 Compensation
Compensation for the Company's Chief Executive Officer, was set according to
the established compensation philosophy described herein. The Chief
Executive Officer's base salary was a function of surveyed competitive base
compensation in addition to a merit increase determined by evaluating fiscal
year 1996 corporate performance as described.
Options for 30,000 shares were granted to the Chief Executive Officer during
fiscal year 1996. Such grants were based on the established compensation
philosophy described herein. Determination of the number of such options
awarded was based on the Committee's subjective assessment of the Chief
Executive Officer's performance.
COMPENSATION COMMITTEE
Ambassador Robert F. Ellsworth
Dr. Richard N. Baney
Dr. Lynn E. Weaver
Dr. Louis W. Tordella
<PAGE>8
SUMMARY COMPENSATION TABLE
The following table shows the total annual and long-term compensation of the
Chief Executive Officer (the only executive officer to receive total salary
and bonus in excess of $100,000 during the fiscal year ended June 30,
1996) for services rendered during the fiscal years ended June 30, 1996,
1995 and 1994.
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation
Name and Securities
All Other
Principal Underlying Options
Compensation
Position Year Salary($) Bonus($)(a) (#) (b) ($) (c)
<S> <C> <C> <C> <C> <C>
John L. Slack 1996 $216,466 - 30,000 $7,949
President/CEO 1995 $204,937 $49,992(c) 30,000 $7,947
Treasurer, Acting 1994 $204,937 - 32,000 $7,055
</TABLE>
(a) The bonus distribution plan was structured whereby the executive
receives approximately 41% of the bonus in September 1995, 33% in
September 1996 and 26% in September 1997. Distribution of payments may
vary slightly from the plan.
(b) The number of options granted during the covered fiscal year.
(c) Includes Company contributions of $2,901 to the Employee Retirement Plan,
$959 to the Employee Stock Ownership Plan, $750 to the 401(k) plan and
$3,339 in life insurance premiums paid by the Company. Such
contributions to the individual listed totaled $7,949 for fiscal year 1996.
<PAGE>9
OPTION GRANTS IN LAST FISCAL YEAR
The table below shows information regarding grant of stock options made to
the Chief Executive Officer under the Company's 1992 Employee Incentive Stock
Option Plan during the fiscal year ended June 30, 1996. The potential
realizable value of the option is based solely on arbitrarily assumed rates
of appreciation required by applicable SEC regulations. Actual gains, if
any, on option exercises are dependent on the future performance of the
Common Stock and overall stock market conditions.
<TABLE>
<CAPTION>
Potential
Realized
Value at
Assumed
Annual Rates
of
Stock Price
Appreciation
Individual Grants for
Option Term
Number of % of
Securities Total Options Exercise
Underlying Granted to or Base
Option Employees in Price Expiration
Name Granted(#)(1) Fiscal Year ($/Sh) Date 5%($) 10%($)
<S> <C> <C> <C> <C> <C> <C>
John L. Slack 30,000 27.37% $5.50 12/31/98 $38,130
$84,856
</TABLE>
1 Options granted under this Plan have a three-year term and may be exercised
33%, 33% and 34% on or after December 31 of the first, second and third
year, respectively, from the date of grant. Such shares may not be sold
from two years from the date of grant and one year from the date of
acquisition. The option price is equal to the market price of the Company's
stock on the date of grant.
<PAGE>10
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FY-END OPTION VALUES
The following table summarizes for the Chief Executive Officer the number of
stock options exercised during the fiscal year ended June 30, 1996, the
aggregate dollar value realized upon exercise, the total number of
unexercised options held at June 30, 1996, and the aggregate dollar value of
in-the-money, unexercised options, if any, held at June 30, 1996.
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options Options
at FY-End (#) at FY-End ($)
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise(#) Realized($)(a) Unexercisable
Unexercisable(b)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
John L. Slack 27,000 $(10,125) 62,000/30,000 $68,140/$13,700
</TABLE>
(a) Reflects the exercise of options to purchase 27,000 shares at $4.75 per
share. The fair market value of the underlying stock a the time of
exercise was $4.375 per share.
(b) Value of unexercised, in-the-money options at fiscal year-end is the
difference between its exercise price and the fair market value of the
underlying stock on June 30, 1996, which was $5.25 per share.
COMPENSATION OF EXECUTIVES AND DIRECTORS
Compensation of Directors
The nonemployee Directors of the Company receive an annual retainer of
$8,000, payable on a quarterly basis, plus $500 per meeting not to exceed
$1,000 per day. In addition, the Directors participate in the Directors'
Stock Option Plan, under which there were no options issued during fiscal
year 1996.
<PAGE>11
Employment Contracts and Change in Control Arrangement
A compensation agreement between the Company and Mr. Slack provides for a
Company-furnished automobile. The agreement also provides for the bonus
grant of Company stock based on the market price of the Company stock
achieving the following levels:
Bonus Shares Company Stock Price(1)
<TABLE>
<CAPTION>
<C> <C>
2,000 $14.00 per share
2,000 $16.00 per share
2,000 $18.00 per share
2,000 $20.00 per share
</TABLE>
1 The agreement stated that the price must be achieved and retained for at
least four consecutive weeks.
Mr. Slack has also received an option for 25,000 shares which will be
exercisable in the event the Company is sold during his tenure as President
upon terms and price acceptable to the shareholders of the Company.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. William C. Potter is President of the law firm of Potter, McClelland,
Marks & Healy, P.A. and is legal counsel to the Company. The amount accrued
or paid to this firm for legal services in fiscal year 1996 was approximately
$10,560.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 (the"Act") requires the
Company's directors and executive officers, as well as persons who own more
than ten percent of a registered class of a company's equity securities, to
file with the SEC initial reports of ownership and report changes in
ownership of Common Stock and other equity securities of the Company.
Directors, executive officers and more than ten percent owners are required
by SEC regulation to furnish the Company with copies of all such filings
which they make under Section 16(a) of the Act.
Based on a review of Company records, two members of the Board of Directors
filed the required Form 4 concerning stock trades outside of the specified
reporting period. Dr. Richard N. Baney's transaction on February 27, 1996
due on March 10, 1996 and transaction on March 11, 1996 due on April 10, 1996
were both filed on April 19, 1996. Mr. John L. Slack's transaction on
December 29, 1995 due on January 10, 1996 was filed on January 24, 1996.
<PAGE>12
FIVE YEAR SHAREHOLDER RETURN COMPARISON
The performance graph set forth below compares the cumulative five-year
total return for the Common Stock with the NASDAQ Stock Market Index and
NASDAQ Electronic Components Index. Returns are based on the change in
month-end to month-end price and assume reinvested dividends. These
calculations assume the value of an investment in the Common Stock, the
NASDAQ Stock Market Index and the NASDAQ Electronic Component Index each
was $100 on June 30, 1991.
<TABLE>
<CAPTION>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG DBA SYSTEMS, INC., THE NASDAZ STOCK MARKET-US INDEX
AND THE NASDAQ ELECTONIC COMPONENTS INDEX
<S> <C> <C> <C> <C> <C> <C>
6/91 6/92 6/93 6/94 6/95 6/96
DBA SYSTEMS, INC. 100 164 141 153 264 182
NASDAQ STOCK MARKET-US 100 120 151 152 204 261
NASDAQ ELEC COMPONENTS 100 122 210 231 476 504
</TABLE>
* $100 invested on 6/30/91 in stock or index including reinvestment
of dividends. FIscal year ending June 30.
Management believes the NASDAQ Electronic Components Index industry group is
appropriate in view of the Company's historical business base. The Company
is currently diversifying its operations to non-defense industries and if
successful, a different industry group may be more appropriate in the future.
<PAGE>13
SECURITY OWNERSHIP
Information regarding beneficial ownership of the Common Stock by the
Company's directors and executive officers is set forth herein under the
captions "Election of Directors -- Nominees for Election to the Board of
Directions", "Continuing Directors" and "Executive Officers". The following
shareholders reported that they owned in excess of 5% of the outstanding
Common Stock as of August 30, 1996. Unless otherwise indicated, each of the
shareholders listed below has sole voting and sole investing power with
respect to the shares listed opposite such shareholder's name.
Amount of Percent
Name and Address Beneficial Ownership of Class
<TABLE>
<CAPTION>
<S> <C> <C>
Norman J. Wechsler 1,513,532 (1) 33.76%
39 Broadway
New York, NY 10006
Kathryn A. Eckstein 400,000 8.92%
614 West Front Street
Cassville, WI 53806
John L. Slack 230,758 (2) 5.04%
745 Beach Street
Satellite Beach, FL 32937
All directors and 321,326 (3) 6.92%
executive officers
as a group
</TABLE>
(1) Includes 2,103 shares issuable upon conversion of $41,000 principal
amount of the Company's 8 1/4% Convertible Subordinated Debentures due
2010 (the "Debentures").
(2) Includes 92,000 shares issuable upon exercise of options, 512 shares
issuable upon conversion of $10,000 principal amount of the Company's
8 1/4% Convertible Subordinated Debentures due 2010 and 1,296 shares held
in trust by DBA Systems Employee Stock Ownership Plan and Trust.
Excludes options for 3,000 shares owned by Mr. Slack's wife as to which
shares, he disclaims any beneficial interest and options for 25,000
shares exercisable in the event the Company is sold during Mr. Slack's
tenure as President upon terms and price acceptable to the stockholders
of the Company.
(3) Includes 161,000 shares issuable upon exercise of options, 512 shares
issuable upon conversion of $10,000 principal amount of the Debentures,
and 2,831 shares held in trust by DBA Systems Employee Stock Ownership
Plan and Trust.
<PAGE>14
EXECUTIVE OFFICERS
Common
Stock % of
Beneficially Outstanding
Owned Common
Name Age Position with Company as of 8/30/96 Stock
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
John L. Slack 58 Chairman of the Board, 230,758(1) 5.04
President, CEO, Treasurer
Acting & Director
Dudley J. Gordon 60 Divisional Vice President 20,201(2) .45
for Operations
Charles B. Robertson 50 Vice President of 25,334(3) .56
Administration, Corporate
Secretary
Edward M. Bielski 44 Corporate Controller 6,200(4) .14
</TABLE>
(1) See "Election of Directors -- Continuing Directors" for a description of
the components comprising common stock beneficially owned.
(2) Includes outstanding options for 20,000 shares and 201 shares held in
trust by the DBA Systems Employee Stock Ownership Plan and Trust.
(3) Includes options for 24,000 shares and 1,334 shares held in trust by the
DBA Systems Employee Stock Ownership Plan and Trust.
(4) Includes options for 5,000 shares.
JOHN L. SLACK was elected as the President and Chief Executive Officer of the
Company in August 1989 succeeding Mr. Howard N. Hebert as Chief Executive
Officer and Mr. Gerald A. Nathe as President. Mr. Slack was elected as
Chairman of the Board of Directors in February 1990. Mr. Slack assumed the
duties of Acting Treasurer on May 15, 1994, with the departure of Mr. William
R. LeMasters, Vice President of Finance, from the Company. All other
financial duties have been delegated to the Corporate Controller.
Biographical information about Mr. Slack appears above under the caption
"Directors' Background and Experience -- Continuing Directors".
DUDLEY J. GORDON joined the Company in March 1995 as Divisional Vice
President of Operations. Prior to joining DBA, Mr. Gordon held several
positions as senior operations officer in various successful commercial
ventures. Preceding his commercial career, Mr. Gordon served in the United
States Army, enlisting in 1954 as a private and rising to the rank of Major
General prior to his retirement in 1986 in the grade of Brigadier General.
CHARLES B. ROBERTSON joined the Company in 1986 as a Program Manager. Prior
to joining DBA, Mr. Robertson was responsible for all Air Launched Missile
Systems Subcontracts for Martin Marietta, Orlando, FL. He has held numerous
management positions during his tenure at DBA including Director of the
Military Products Division. In July 1990, Mr. Robertson became Director of
Administration and in January 1994, he became Vice President of
Administration and Corporate Secretary.
<PAGE>15
EDWARD M. BIELSKI joined the Company in May 1996 as Director of Finance to
replace Mr. Timothy L. Stull. In August 1996, he became Corporate Controller.
Prior to joining DBA, Mr. Bielski was Chief Financial Officer of the Atlas
Door Company in Orlando, Fl. He has 17 years of aerospace experience having
held senior financial management positions with Martin Marietta, LTV and
Litton Industries. Mr. Bielski is a licensed CPA with the State of Florida.
Mr. Bielski holds a Master's degree in Management and a Bachelor's degree in
Aeronautical Engineering from Purdue University.
RELATIONSHIP WITH INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS
The Board of Directors has selected Deloitte & Touche LLP, Certified Public
Accountants, to serve as the Independent Certified Public Accountants for
the Company during Fiscal Year 1997 and recommends that shareholders vote
for such selection.
Deloitte & Touche LLP conducted the Company's fiscal year 1996 independent
audit. A representative of Deloitte & Touche LLP will be present at the
Meeting. This representative will have the opportunity to make a statement
regarding the year-end audit and will be available to respond to appropriate
questions for the shareholders.
OTHER BUSINESS
It is not anticipated that any action will be asked of the shareholders at
the Meeting other than the election of directors and the approval of the
selection of Deloitte & Touche LLP as Independent Certified Public
Accountants. If any other matters are properly presented to the Meeting, it
is intended that the persons named in the proxy will vote in their best
judgment on such matters.
To be considered for inclusion in the proxy material relating to the 1997
Annual Meeting of Shareholders, shareholders' proposals must be received by
the Secretary, DBA Systems, Inc., P.O. Box 550, Melbourne, Florida,
32902-0550, on or before June 13, 1997. A copy of the Company's Annual
Report filed with the Securities and Exchange Commission on Form 10-K is
available, without charge, upon written request to the Company Secretary.
By Order of the Board of Directors,
________________________
(signature) John L. Slack
Chairman of the Board, President,
Chief Executive Officer and
Treasurer, Acting
Melbourne, Florida
October 11, 1996
<PAGE>16
DBA SYSTEMS, INC.
1101 West Hibiscus Boulevard, Melbourne, Florida 32901
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints John L. Slack and Charles B. Robertson or
any one of the two acting in the absence of the other, with authority to
appoint, in writing, substitutes to act in their place, proxies for and in
the name and place of the undersigned, to vote the number of shares of
DBA Systems, Inc. at its Annual Meeting of Shareholders to be held at the
DBA Conference Facility, Granada Center, 1101 West Hibiscus Boulevard,
Melbourne, Florida on November 13, 1996, at 1:00 p.m., local time, or any
adjournment thereof, upon the matters set forth in the Notice of Annual
Meeting and Proxy Statement, receipt of which is hereby acknowledged, as
follows:
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER.
IF A DULY EXECUTED PROXY CONTAINS NO SPECIFICATIONS WITH
RESPECT TO A MATTER WHERE CHOICE IS PROVIDED, THIS WILL BE VOTED
"FOR" PROPOSALS 1 AND 2.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE
__X__ Please Mark
votes as in
this example.
PLEASE FILL IN, DATE, SIGN AND MAIL THIS PROXY IN THE ENCLOSED POST-PAID
RETURN ENVELOPE.
FOR AGAINST ABSTAIN
1. To elect two Class I Directors 2.To approve the ___ ___ ____
and one class III Director. selection of Deloitte &
Touche LLP:Orlando Florida as the
Class I Nominees Richard N. Baney Company Independent Certified
William C. Potter Public Accountants
Class III Nominee: Thomas J. Boyce, Jr.
FOR WITHHELD
____ ___ 3 To consider and act upon any other
matters which may properly come
before the Meeting and any
adjournments thereof.
______
For all nominees except as noted above
MARK HERE MARK HERE
FOR ADDRESS IF YOU PLAN
CHANGE AND ___ TO ATTEND ___
NOTE AT LEFT THE MEETING
Signature____________ Date______ Signature______________ Date________
