_______________________________________
DYNASIL CORPORATION OF AMERICA
385 Cooper Road
West Berlin, New Jersey 08091-9145
(856) 767-4600
_______________________________________
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD AT 11:00 AM,
ON FEBRUARY 1, 2000
To the Stockholders of Dynasil Corporation of America:
The 2000 annual meeting of stockholders of Dynasil Corporation of America (the
"Company"), a New Jersey corporation, will be held at the corporate headquarters
of the Company located at 385 Cooper Road, West Berlin, NJ, 08091 on February
1, 2000 at beginning at 11:00 A.M. local time. At the meeting, stockholders
will act upon the following matters:
(1) Election of seven (7) Directors, each for a term of one year;
(2) Ratification of appointment of Haefele, Flanagan & Co., p.c., as the
Company's independent accountants for fiscal 2000; and
(3) Any other matters that properly come before the meeting.
Stockholders of record at the close of business on November 30, 1999 are
entitled to vote at the meeting or any postponement or adjournment.
The accompanying form of proxy is solicited by the board of directors of the
company.
Stockholders (Whether they own one or many shares and whether they expect to
attend the annual meeting or not) are requested to vote, sign, date and return
promptly the accompanying proxy in the enclosed self addressed stamped envelope.
A proxy may be revoked at any time prior to its exercise (a) by notifying the
secretary of the company in writing, (b) by delivering a duly executed proxy
bearing a later date, or by attending the annual meeting and voting in person.
By order of the Board of Directors:
_____________________________
John Kane, Corporate Secretary
December 23, 1999
West Berlin, New Jersey
<PAGE>
DYNASIL CORPORATION OF AMERICA
385 Cooper Road
West Berlin, New Jersey 08091-9145
(856) 767-4600
______________________________
PROXY STATEMENT
______________________________
This Proxy Statement contains information related to the annual meeting of
stockholders of Dynasil Corporation of America (the "Company"), to be held on
Tuesday, February 1, 2000 at 11:00 A.M., local time, at the corporate
headquarters of the Company, 385 Cooper Road, West Berlin, New Jersey,
and at any adjournment or adjournments thereof.
ABOUT THE MEETING
What is the purpose of the annual meeting?
At the Company's annual meeting, stockholders will act upon the matters
outlined in the accompanying notice of meeting, including the election of
directors and ratification of the Company's independent auditors. In addition,
the Company's management will report on the performance of the Company during
fiscal 1999 and respond to questions from stockholders.
Who is entitled to vote?
Only stockholders of record at the close of business on the record date,
November 30, 1999 are entitled to receive notice of the annual meeting and to
vote the shares of common stock that they held on that date at the meeting, or
any postponement or adjournment of the meeting. Each outstanding share entitles
its holder to cast one vote on each matter to be voted upon.
Who can attend the meeting?
All stockholders as of the record date, or their duly appointed proxies,
may attend the meeting.
Please note that if you hold your shares in "street name" (that is, through
a broker or other nominee), you will need to bring a copy of a brokerage
statement reflecting your stock ownership as of the record date and check in at
the registration desk at the meeting.
What constitutes a quorum?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the shares of common stock outstanding on the record date will
constitute a quorum, permitting the meeting to conduct its business. As of the
record date, 2,345,136 shares of common stock of the Company were outstanding.
1
<PAGE>
Proxies received but marked as abstentions and broker non-votes will be included
in the calculation of the number of shares considered to be present at the
meeting.
How do I vote?
If you complete and properly sign the accompanying proxy card and return it
to the Company, it will be voted as you direct. If you are a registered
stockholder and attend the meeting, you may deliver your completed proxy card in
person. "Street name" stockholders who wish to vote at the meeting will need to
obtain a proxy form from the institution that holds their shares.
Can I change my vote after I return my proxy card?
Yes. Even after you have submitted your proxy, you may change your vote at
any time before the proxy is exercised by filing with the Secretary of the
Company either a notice of revocation or a duly executed proxy bearing a later
date. The powers of the proxy holders will be suspended if you attend the
meeting in person and so request, although attendance at the meeting will not
by itself revoke a previously granted proxy.
What are the board's recommendations?
Unless you give other instructions on your proxy card, the persons named as
proxy holders on the proxy card will vote in accordance with the recommendations
of the Board of Directors. The Board's recommendation is set forth together with
the description of each item in this proxy statement. In summary, the Board
recommends a vote:
1. for election of the nominated slate of directors (see page 5); and
2. for ratification of the appointment of Haefele Flanagan & Co., p.c.,
as the Company's independent auditors (see page 9).
With respect to any other matter that properly comes before the meeting,
the proxy holders will vote as recommended by the Board of Directors or, if no
recommendation is given, in their own discretion.
What vote is required to approve each item?
Election of directors. The affirmative vote of a plurality of the votes
cast at the meeting is required for the election of directors. A properly
executed proxy marked "WITHHOLD AUTHORITY" with respect to the election of one
or more directors will not be voted with respect to the director or directors
indicated, although it will be counted for purposes of determining whether
there is a quorum.
Other items. For each other item, the affirmative vote of the holders of a
majority of the shares represented in person or by proxy and entitled to vote on
the item will be required for approval. A properly executed proxy marked
"ABSTAIN" with respect to any such matter will not be voted, although it will be
counted for purposes of determining whether there is a quorum. Accordingly, an
abstention will have the effect of a negative vote.
If you hold your shares in "street name" through a broker or other nominee,
your broker or nominee may not be permitted to exercise voting discretion with
respect to some of the matters to be acted upon. Thus, if you do not give your
broker or nominee specific instructions, your shares may not be voted on those
matters and will not be counted in determining the number of shares necessary
for approval. Shares represented by such "broker non-votes" will, however,
be counted in determining whether there is a quorum.
2
<PAGE>
STOCK OWNERSHIP
Who are the largest owners of the company's stock?
James Saltzman, Chairman of the Board of Directors of the Company, owns or
controls 24.63% of the outstanding shares of common stock of the Company; and
Robert Lear, a director of the Company, owns or controls 7.37% of the
outstanding shares of common stock of the Company. See the table below.
How much stock do the company's directors and executive officers own?
The following table sets forth the beneficial ownership of the Common Stock
of the Company as of November 30, 1999 by each person who was known by the
Company to beneficially own more than 5% of the common stock, by each director
and executive officer who owns shares of common stock and by all directors and
executive officers as a group:
<TABLE>
<CAPTION>
Title Name and Address No. of Shares and nature of Percent of
of Class of Beneficial Owner Beneficial Ownership(1) Class
- -------- ------------------- --------------------------- ----------
<S> <C> <C> <C>
Common James Saltzman(2) 580,865 24.63%
621 East Germantown Pike
Suite 105
Plymouth Valley PA 19401
Common Gen. Charles J. Searock, 90,496 3.85%
Jr. (USAF Ret) (3)
39 Tee Pee Court
Medford, NJ 08055
Common Jan Melles(4) 56,500 2.40%
9 Riverside Road
Laguna Niguel, CA 92677
Common Nathan Schwartz(5) 48,394 2.03%
621 East Germantown Pike
Suite 105
Plymouth Valley, PA 19401
Common Dr. Peter P. Bihuniak(6) 16,000 0.68%
631 Scenic Circle
Holland, OH 43528
Common Robert Lear(7) 173,236 7.37%
420 South York Road
Hatboro, PA 19040
Common Robert E. Hibshman, Sr.(8) 59,000 2.51%
19689 7th Ave. NE, Suite 182
Poulsbo, WA 98370-7576
Common John Kane(9) 15,425 0.66%
149 Plowshare Road
Norristown, PA 19403
Common Bruce Leonetti 100 0.00%
200 Birdwood Avenue
Haddonfield, NJ 08033
All Officers and Directors
as a Group 1,040,015 42.76%
</TABLE>
- ------------
(1) The numbers and percentages shown include shares of common stock issuable to
the identified person pursuant to stock options that may be exercised within 60
days. In calculating the percentage of ownership, such shares are deemed to be
outstanding for the purpose of computing the percentage of shares of common
stock owned by such person, but are not deemed to be outstanding for the
purpose of computing the percentage of share of common stock owned by any other
stockholders. The number of shares outstanding on September 30, 1999 was
2,344,942.
(2) Includes options to purchase 7,500 shares of the Company's common stock at
$1.00 per share, options to purchase 3,000 shares of the Company's common stock
at $3.52 per share, and options to purchase 3,000 shares of the Company's common
stock at $1.17 per share; also includes 567,365 shares owned by Saltzman
Partners.
(3) Includes options to purchase 3,000 shares of the Company's common stock at
$1.17 per share.
(4) Includes options to purchase 3,000 shares of the Company's common stock at
$3.52 per share, and options to purchase 3,000 shares of the Company's common
stock at $1.17 per share.
3
<PAGE>
(5) Includes options to purchase 20,000 shares of the Company's common stock at
$1.50 per share, options to purchase 5,000 shares of the Company's common stock
at $1.50 per share, options to purchase 3,000 shares of the Company's common
stock at $4.25 per share, options to purchase 3,000 shares of the Company's
common stock at $3.52 per share, and options to purchase 3,000 shares of the
Company's common stock at $1.17 per share.
(6) Includes options to purchase 10,000 shares of the Company's common stock at
$3.00 per share, options to purchase 3,000 shares of the Company's common stock
at $3.52 per share, and options to purchase 3,000 shares of the Company's common
stock at $1.17 per share.
(7) Includes options to purchase 3,000 shares of the Company's common stock at
$3.52 per share, and options to purchase 3,000 shares of the Company's common
stock at $1.17 per share; also includes 167,236 shares owned by Penn Independent
Corporation, for which Mr. Lear disclaims beneficial ownership.
(8) Includes options to purchase 3,000 shares of the Company's common stock at
$1.17 per share.
(9) Includes options to purchase 5,500 shares of the Company's common stock at
$2.65 per share.
4
<PAGE>
ITEM 1
ELECTION OF DIRECTORS
Seven (7) directors will be elected to hold office subject to the provisions of
the Company's by-laws until the next Annual Meeting of Shareholders, and until
their respective successors are duly elected and qualified. The vote of a
majority of the votes entitled to be cast by shareholders present in person or
by proxy, is required to elect members of the Board of Directors. The following
table sets forth the name, age, position with the Company and respective
director service dates of each person who has been nominated to be a director
of the Company:
Positions(s)
Name Age With the Company Director Since
- ----------------------------------------------------------------------------
Mr. James Saltzman 55 Chairman of the Board 1998
Gen. Charles J.
Searock, Jr. 63 President, CEO, Director 1996
Mr. Jan Melles 59 Director 1996
Mr. Nathan Schwartz 38 Director 1996
Dr. Peter P. Bihuniak 50 Director 1997
Mr. Robert Lear 54 Director 1998
Mr. Robert E.
Hibshman, Sr. 72 Director 1999
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE NOMINEES LISTED HEREIN.
Business Experience of the Directors
James Saltzman, Chairman, 55, has been a member of the Board since February
1998, and is a major shareholder in Dynasil Corporation. Mr. Saltzman, has been
the General Partner of Saltzman Partners, an investment firm, since 1982. Since
January 1997, Mr. Saltzman has served as Vice Chairman of Madison Monroe, Inc.,
a private company engaged in investments. He served as a director of Xyvision,
Inc., a publicly held company which develops, markets, integrates and supports
content management and publishing software, since 1992, and was Chairman of the
Board of such company from February 1994 to February 1995.
General Charles J. Searock, Jr. (USAF Ret), 63, has been a director of the
Corporation since February 1996 and currently serves as President and CEO.
General Searock retired from the United States Air Force having attained the
rank of Lieutenant General in 1993 after 36 years of active duty, having
received numerous military decorations. Prior to joining Dynasil, he was
executive Vice President of Aero Development Corporation from 1993 to 1996.
General Searock earned a BA in General Education from the University of
Nebraska in 1962, and a Masters degree in Management from Central Michigan
University in 1975.
Jan Melles, 59, has been a member of the Board of Directors of the Company
since February 1996. Since 1993, Mr. Melles has been President and sole
shareholder of Photonics Investments, bv, which is engaged in investments in,
and mergers and acquisitions of, photonics companies. From 1988 to 1992, he
served as Chief Executive Officer of Melles Griot, Inc., a division of J.
Bibby & Sons, PLC. Mr. Melles co-founded Melles Griot, Inc. in 1969 and sold
it to J. Bibby &
Sons, PLC in 1988. Mr. Melles also serves as a director of Excel Technology,
Inc., a publicly held company, and as a director of Gooch and Housego, PLC, a
publicly held company.
Nathan Schwartz, 38, has been a member of the Board since February 1996. He
is an attorney and financial advisor, providing legal and financial advice to
numerous financial service clients since 1992. Mr. Schwartz earned a B.A. in
History from Kenyon College in 1982, an M.B.A. in Public/Private Management from
Columbia University in 1986, and a J.D. from the University of Pittsburgh in
1989.
5
<PAGE>
Dr. Peter P. Bihuniak, 50, has been a member of the Board since February
1997. He has held his current position of Vice President of Technology for
SOLAREX since 1997. From 1995 to 1997, he served as Director of Research and
Development of Pilkington, Libbey-Owens-Ford in Toledo, Ohio, directing
invention
and development efforts for high performance glass. From 1988 to 1995, Mr.
Bihuniak served in various positions with PPG Industries, Inc., one of the major
producers of flat glass, fabricated glass and continuous-strand fiber glass in
the world, serving most recently as General Manager, Flat Glass Specialty
Products Division.
Robert Lear, 54, has been a member of the Board since February 1998. He is
President of Penn Independent Corporation, a property and casualty insurance
enterprise. Mr. Lear has been President and Chief Executive Officer of Penn
Independent since September 1996 and previously served as Executive Vice
President-Finance and Chief Financial Officer of that company for more than
seven
years. He was Vice President-Finance and Chief Financial Officer of Penn-America
Group, Inc. from its formation in July 1993 until March 1995, and still serves
Penn-America Group, Inc. as a director. Prior to joining Penn Independent, Mr.
Lear had over 15 years of public accounting experience, specializing in the
insurance industry. Mr. Lear is a certified public accountant.
Robert E. Hibshman, Sr., 72, has been a member of the Board since January
1999. He founded Hibshman Optical Labs, Inc. which was purchased by his son,
Robert E. Hibshman Jr. and eventually sold to Dynasil Corporation as Hibshman
Corporation. Mr. Hibshman Sr. is currently retired and is occupied with property
development and investments.
How are directors compensated?
Directors Compensation. No member of the Board receives any cash
compensation for serving on the Board except for reimbursement of reasonable
expenses incurred in attending meetings. All board members receive an annual
option to purchase 3,000 shares of the Company's common stock at an exercise
price that reflects market price at time of issuance.
What committees has the Board established?
Compensation Committee. The Compensation Committee is responsible for
negotiating and approving salaries and employment agreements with officers of
the Company. The committee consist of Messrs. Lear, Bihuniak and Schwartz.
Technical Advisory Committee. The Technical Advisory Committee is
responsible for developing policies and procedures to ensure quality remains at
the forefront of the Company's manufacturing process. The committee consist of
Messrs. Bihuniak, Searock and Saltzman.
6
<PAGE> EXECUTIVE COMPENSATION
The following table sets forth all information concerning total compensation
earned or paid to the officers of the Company who served in such capacities as
of September 30, 1999 for services rendered to the Company during each of the
last three fiscal years.
Summary Compensation Table
<TABLE>
<CAPTION>
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- ------ -------
Other Securities Long-
Name and Annual Restricted Underlying Term All other
Principle Compen- Stock Options Incentive compen-
Position Year Salary ($) Bonus ($) sation ($) Awards ($) ($) Plans ($) sation ($)
- --------- ---- ---------- --------- ---------- ----------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Charles J. 1999 122,703
Searock, 1998 124,797
President, 1997 88,054 16,250
CEO
John 1999 83,339 2,625
Kane, 1998 88,289 1,118 6,000
Secretary, 1997 57,212 624 13,500
Treasurer,
CFO
Bruce 1999 65,042
Leonetti,
VP
</TABLE>
Employment Agreements
The three year employment agreement with Charles J. Searock, Jr., Chief
Executive Officer and President, which commenced on December 1, 1996 was renewed
for an additional one year term on December 1, 1999. It will renew automatically
at the end of the term unless terminated by either party upon ninety days
written
notice prior to the end of the term. Under the employment agreement, Mr. Searock
has agreed to work for us full time, and receives an annual base salary of
$125,000. Mr. Searock's agreement also provides for an annual bonus at the
discretion of our Board of Directors. The agreement also provides for a 401(k)
pension plan, health insurance benefits and contains three-year non-competition
provisions that prohibit him from competing with us. In addition, the agreement
provides that if Mr. Searock is terminated without cause, he will receive a
severance consideration of one year's salary.
The current employment agreement with John Kane, Chief Financial Officer,
Secretary and Treasurer, commenced on January 20, 1997 and will continue for a
three-year period, after which the agreement will automatically renew for
one-year terms, unless terminated by either party upon ninety days written
notice
prior to the end of any term, or for cause. Under the employment agreement, Mr.
Kane has agreed to work for us full time, and receives an annual base salary of
$85,000, to be reviewed no less than annually. Mr. Kane's agreement also
provides
for an annual bonus at the discretion of our Board of Directors. The agreement
also provides for a 401(k) pension plan, health insurance benefits and contains
eighteen month non-competition provisions that prohibit him from competing with
us.
We have also entered into an employment agreement with Bruce Leonetti, Vice
President of Marketing and Sales, which commenced on January 1, 1999 and will
continue for a three-year period, unless terminated for cause. Under the
employment agreement, Mr. Leonetti has agreed to work for us full time,
7
<PAGE>
and receives an annual base salary of $89,000, with commissions based on the
gross dollar amount of product shipped. Mr. Leonetti's agreement also provides
for an annual bonus at the discretion of our Board of Directors. The agreement
also provides for a 401(k) pension plan, health insurance benefits and contain
twenty four month non-competition provisions that prohibit him from competing
with us. In addition, the agreement provides that if Mr. Leonetti is terminated
without cause, he will receive a severance consideration of three months'
salary.
Option Grants in Last Fiscal Year
The following table sets forth information concerning options granted to the
executives named in the Summary Compensation Table above during the year ended
September 30, 1999.
<TABLE>
<CAPTION>
Individual Grants Potential Realizable
Number of % of Total Value at Assumed
Securities Options Exercise Annual Rates of Stock
Underlying Granted to or Base Price Appreciation
Options Employees in Price Expiration for Option Term
Name Granted (#) Fiscal Year ($/Sh) Date 5% 10%
<S> <C> <C> <C> <C> <C. <C>
Charles J.
Searock 3,000 100% $1.17 1/26/2004 $ 0 $0
</TABLE>
Aggregated Option Exercises in Last Fiscal Year and Year End Option Values
The following table sets forth information concerning option exercises during
the last fiscal year and outstanding options held as of September 30, 1999 by
the executive named in the Summary Compensation Table above.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying In-the-Money
Unexercised Options at Options at
Shares Fiscal Year End (#) Fiscal Year end ($)
Acquired on Value Exercisable/ Exercisable/
Name Exercise (#) Realized ($) Unexercisable Unexercisable
<S> <C> <C> <C> <C>
Charles J. Searock ----- ----- 3,000 / 0 $0 / $0
John Kane ----- ----- 5,500 / 0 $0 / $0
</TABLE>
8
<PAGE>
ITEM 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTS
The Company has appointed Haefele, Flanagan & Company, p.c. as the Company's
independent for the fiscal year ending September 30, 2000. Services provided to
the Company by Haefele, Flanagan & Company in fiscal year 1999 included the
examination of the Company's consolidated financial statements, preparation of
federal and state income taxes, and services related to filings with the
Securities and Exchanges Commission.
Representatives of Haefele, Flanagan & Co. will be present at the annual meeting
to respond to appropriate questions and to make such statements as they may
desire.
The Board of Directors Recommends a Vote "For" Ratification of The Appointment
of Haefele, Flanagan & Company as The Company's Independent Accountants For
Fiscal Year 2000
OTHER MATTERS
As of the date of this proxy statement, the Company knows of no business that
will be presented for consideration at the annual meeting other than the items
referred to above. In the event that any other matter is properly brought before
the meeting for action by the stockholders, proxies in the enclosed form
returned
to the Company will be voted in accordance with the recommendation of the Board
of Directors or, in the absence of such a recommendation, in accordance with the
judgment of the proxy holder.
ADDITIONAL INFORMATION
Stockholder Proposals for the 2000 Annual Meeting. Stockholders interested
in presenting a proposal for consideration at the Company's annual meeting of
stockholders in 2001 may do so by following the procedures prescribed in Rule
14a-8 under the Securities Exchange Act of 1934 and the Company's by-laws. To be
eligible for inclusion, stockholder proposals must be received by the Company's
Corporate Secretary no later than August 23, 2000.
Proxy Solicitation Costs. The proxies being solicited hereby are being
solicited by the Company. The cost of soliciting proxies in the enclosed form
will be borne by the Company. Officers and regular employees of the Company
may,
but without compensation other than their regular compensation, solicit proxies
by further mailing or personal conversations, or by telephone, telex, facsimile
or electronic means. The Company will, upon request, reimburse brokerage firms
and others for their reasonable expenses in forwarding solicitation material to
the beneficial owners of stock.
By order of the Board of Directors:
___________________________
John Kane
Corporate Secretary
December 23, 1999
West Berlin, New Jersey
9
<PAGE>
PROXY FORM DYNASIL CORPORATION OF AMERICA PROXY FORM
Annual Meeting of Stockholders - To Be Held February 1, 2000
THE BOARD OF DIRECTORS SOLICITS THIS PROXY
The undersigned hereby appoint(s) CHARLES J. SEAROCK, JR. and JAMES SALTZMAN, or
either of them, as attorney, agent and proxy of the undersigned, with full power
of substitution, to vote all shares of common stock of Dynasil Corporation of
America that the undersigned would be entitled to cast if personally present at
the 2000 Annual Meeting of Stockholders of the Company, and at any postponement
or adjournment thereof.
THIS PROXY WILL BE VOTED AS SPECIFIED BY THE UNDERSIGNED. IF NO CHOICE IS
SPECIFIED, THE PROXY WILL BE VOTED FOR EACH OF THE BELOW LISTED PERSONS AND
PROPOSALS.
Please date, sign exactly as your name appears on the form, and mail the proxy
promptly. When signing as an attorney, executor, administrator, trustee or
guardian, please give your full title as such. If shares are held jointly, both
owners must sign.
Director Nominees:
(1) Charles J. Searock, Jr., (2) Jan Melles, (3) Nathan Schwartz,
(4) Dr. Peter P. Bihuniak, (5) James Saltzman, (6) Robert Lear,
(7) Robert E. Hibshman, Sr.
- ------------------------------------------------------------------------------
(1) ELECTION OF DIRECTORS: Charles J. Searock, Jr., Jan Melles,
Nathan Schwartz, Dr. Peter P. Bihuniak, James Saltzman, Robert Lear,
Robert E. Hibshman, Sr.
<TABLE>
<S> <C> <C>
FOR WITHHOLD WITHHOLD authority to vote for the
All nominees Authority to vote individual nominee(s) identified
(except as marked for all nominees in the space provided below
to the contrary)
[ ] [ ] _________________________________
</TABLE>
(2) To ratify the appointment of Haefele, FOR AGAINST ABSTAIN
Flanagan & Company as the Company's [ ] [ ] [ ]
independent public accountants for
the 2000 fiscal year
(3) To transact such other business as
may properly come before the
meeting or any adjournments thereof [ ] [ ] [ ]
- --------------------------------
SIGNATURE DATE
- --------------------------------
SIGNATURE DATE
