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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant / /
Filed by a Party other than the Registrant /X/
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
ECC INTERNATIONAL CORP.
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(Name of Registrant as Specified In Its Charter)
MICHAEL N. TAGLICH
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(Name of Person(s) Filing Proxy Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(:)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)4 and 0-11:
1) Title of each class of securities to which transaction applies:
Not Applicable
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2) Aggregate number of securities to which transaction applies:
Not Applicable
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:(1)
Not Applicable
------------------------------------------------------------------------
- ------------------------
(1) Set forth the amount on which the filing fee is calculated and state how
it was determined.
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4) Proposed maximum aggregate value of transaction:
Not Applicable
------------------------------------------------------------------------
5) Total Fee paid:
Not Applicable
------------------------------------------------------------------------
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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1996 Annual Meeting of Stockholders
of
ECC INTERNATIONAL CORP.
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Proxy Statement
of
Michael N. Taglich
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TO MY FELLOW ECC INTERNATIONAL CORP. STOCKHOLDERS:
This Proxy Statement dated October 21, 1996 ("Proxy Statement") and the
enclosed blue proxy card are furnished to holders of the common stock, $0.10 par
value per share ("Common Stock"), of ECC International Corp., a Delaware
corporation ("Corporation"), in connection with a solicitation of proxies by
Michael N. Taglich, a stockholder of 1,000 shares of Common Stock of the
Corporation, for use at the 1996 annual meeting of stockholders of the
Corporation and at any adjournments, postponements or rescheduling thereof
("1996 Annual Meeting"). As of the date of this Proxy Statement, the Corporation
has filed its Form 10-K for the fiscal year ended June 30, 1996 with the
Securities and Exchange Commission stating that the 1996 Annual Meeting is
"scheduled for the week of December 2, 1996", but does not set forth the date,
time, or place of the meeting or fix the date for the determination of
stockholders of record entitled to vote at the meeting.
Beginning on or about October 21, 1996, this Proxy Statement and the
enclosed blue proxy card are being first sent or given to stockholders of the
Corporation. The principal executive offices of the Corporation are located at
175 Strafford Avenue, Suite 116, Wayne, Pennsylvania 19087. The address and
telephone number of Michael N. Taglich are 100 Wall Street, 10th Floor, New
York, New York 10005, (212) 479-7112.
THE PROPOSALS
In accordance with Article II, Section 14(a) of the By-laws of the
Corporation, Michael N. Taglich has given notice to the Corporation that at the
1996 Annual Meeting, the following two (2) proposals will be brought up for
discussion and to be voted upon:
1. RESOLVED, that it is the sense of the stockholders of ECC International
Corp., expressed at its annual meeting held in December 1996, that the
Corporation and/or its businesses be sold so as to maximize the return to
stockholders and that the same be done as expeditiously as is consistent
therewith, and to that end, the Board of Directors is requested to cause
the Corporation to engage an independent nationally recognized investment
banking firm to assist the Board in seeking to obtain a purchaser or
purchasers on terms and conditions that the Board deems expedient and in
the best interests of the Corporation and to submit the same to the
stockholders for their authorization.
2. RESOLVED, that Article II, Section 7 of the By-laws of the Corporation
be amended by adding the following provisions to the end thereof: "A
special meeting of the stockholders, for any purpose or purposes, unless
otherwise prescribed by statute or by the Certificate of Incorporation,
shall be called by the Corporation upon written notice from stockholders
owning not less than ten (10%) percent of the Corporation's outstanding
shares of voting stock, which notice shall set forth the purpose or
purposes of such special meeting and the Corporation shall hold the
special meeting of stockholders no later than thirty (30) days after the
date such notice is received
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by the Corporation. Notwithstanding anything to the contrary contained in
Article X, Section 1 of the By-laws of the Corporation, this By-law may
not be amended without the affirmative vote of a majority of shares of
voting stock present in person or represented by proxy at a meeting of
the Corporation's stockholders and entitled to vote on the matter."
This Proxy Statement and the enclosed proxy are being furnished to
stockholders to seek their support in the adoption of both proposals.
MICHAEL N. TAGLICH URGES ALL STOCKHOLDERS TO CHECK THE BOX MARKED "FOR" EACH
PROPOSAL, DATE, SIGN, AND RETURN THE ENCLOSED BLUE PROXY CARD IN THE ENCLOSED
POSTAGE PREPAID ENVELOPE. IF NO MARK IS MADE, YOU WILL BE DETERMINED TO HAVE
GIVEN A DIRECTION TO VOTE THE SHARES REPRESENTED BY THE BLUE PROXY CARD FOR THE
PROPOSALS SET FORTH ABOVE UNDER THE SECTION "THE PROPOSALS", PROVIDED THAT YOU
HAVE SIGNED THE BLUE PROXY CARD.
WHETHER OR NOT YOU SIGN THE PROXY CARD THAT WILL BE SENT TO YOU BY THE
CORPORATION,--WHICH MICHAEL N. TAGLICH BELIEVES WILL NOT INCLUDE THE PROPOSALS
SET FORTH ABOVE--YOU ARE URGED TO SIGN THE ENCLOSED BLUE PROXY CARD. THERE IS NO
CONFLICT BETWEEN THE TWO PROXIES AS MICHAEL N. TAGLICH BELIEVES THAT THE
CORPORATION'S PROXY WILL DEAL ONLY WITH THREE (3) UNRELATED MATTERS AND ALSO
"SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING". THE BLUE PROXY
CARD THAT IS ENCLOSED DEALS WITH THE TWO (2) ABOVE-STATED PROPOSALS THAT WILL BE
PROPERLY BROUGHT BEFORE THE 1996 ANNUAL MEETING.
Shares of Common Stock of the Corporation cannot be voted at the 1996 Annual
Meeting in favor of the proposals set forth in the section entitled "THE
PROPOSALS" above unless the holder is present in person or represented by proxy.
A stockholder signing and returning the enclosed blue proxy card has the power
to revoke at any time prior to its exercise by giving notice to the Corporation
in writing or in open meeting, but without affecting any vote previously taken.
BACKGROUND
Following telephone conversations and correspondence between Michael N.
Taglich and George W. Murphy, President of the Corporation, on September 11,
1996, Michael N. Taglich sent the following letter to George W. Murphy,
President of the Corporation:
"September 11, 1996
Mr. George W. Murphy
ECC International Corp.
175 Strafford Avenue, Suite 116
Wayne, PA 19087-3377
Dear George,
I have read with interest your press release of August 28,
announcing the shareholder rights plan. I agree that ECC
should protect shareholders from "abusive take-over
tactics".
However, I also believe it is in the best interests of all
shareholders for ECC to consider the sale of the whole
company or the sale of the government related business. It
is my opinion that the sum of the value of the parts of
ECC will be
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substantially in excess of the current stock price. I
believe ECC should allow the shareholders to decide if
this plan is advisable. Accordingly I intend to make such
a proposal to the Company for inclusion in the proxy and
for discussion and action at the annual meeting.
This proposal will ask the Company to hire a nationally
recognized investment banking firm to examine ways to
enhance shareholder value, including the possibility of
selling the Company.
I will shortly be making a public announcement about this
and would welcome a conversation with you prior to doing
so. It is not my intention to put the Company or its
employees under any undue pressure. I have repeatedly
attempted to work with you and the Board--I remain
prepared to do so now. I am, however, quite convinced that
some action needs to be taken. I am prepared to initiate
this without your support.
I look forward to hearing from you soon.
Sincerely,
Michael N. Taglich"
No response was received from Mr. Murphy. Instead, counsel for the
Corporation replied as follows:
" September 13, 1996
Mr. Michael N. Taglich
100 Wall Street
10th Floor
New York, New York 10005
Dear Mr. Taglich:
George Murphy, President of ECC International Corp., has
referred your letter of September 11, 1996 to this firm.
In your letter, you indicated an intent to make a proposal
for inclusion in ECC's proxy statement for the annual
meeting of stockholders. ECC will include in its proxy
statement any stockholder proposal that complies with Rule
14a-8 of Regulation 14A under the Securities Exchange Act
of 1934. You should be aware that Rule 14a-8(a)(3)(i)
requires that a proponent shall submit his proposal not
less than 120 days in advance of the date of the
registrant's proxy statement released to stockholders in
connection with the previous year's annual meeting of
stockholders. Accordingly, last year's proxy statement
sets forth on page 14 (a copy of which is enclosed) the
deadline for submission of stockholder proposals for this
year's annual meeting, which was June 25, 1996.
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You also mentioned in your letter that you may be making a
public announcement concerning your proposal. We would
suggest that you may wish to consider seeking the advice
of counsel in this regard in order to assure compliance
with proxy solicitation and stockholder communications
regulations.
Very truly yours,
Philip P. Rossetti
cc: Mr. George W. Murphy"
PURPOSES OF THE PROPOSALS
THE PURPOSE OF THE FIRST PROPOSAL is to set in motion the necessary steps so
that, as soon as possible, the Corporation, as an entity, and/or its businesses
be sold to enable stockholders to realize the true value of their investment.
The stock of the Corporation has not benefitted from the substantial increase
that has occurred in the value of other listed securities and, quite to the
contrary, remains at or near its lowest price in several years. Michael N.
Taglich believes that the current market price of the Corporation's stock is not
reflective of the purchase price that could be obtained if the Corporation and
its businesses were made available for sale.
Michael N. Taglich believes that the best way for stockholders to obtain the
full value of their stockholdings is for the Board of Directors to direct a
nationally recognized investment banking firm that is totally independent and
that can objectively appraise the value of the Corporation and its businesses
and their prospects and then approach prospective purchasers and assist the
Board in negotiating a sale or sales.
The proposal does not deprive the Board of Directors of the ability to
consider and evaluate any offers. In doing so, however, it imposes upon the
Board the obligation not to give priority to the interests of its members and
the officers of the Corporation and to take into account that the stockholders
are the owners of the Corporation and that the Board has a fiduciary obligation
to them. Should a purchase offer be received that would produce more to
stockholders than the market price of the stock and that the independent banking
firm, after informed studies, favorably recommends, it should be compelling for
the Board to submit the proposal to the stockholders. The Board can then make
such recommendations and arguments as it deems appropriate, and it will then be
up to the stockholders to make a determination of what is in their best
interests. That is proper corporate governance.
If you share the opinion of Michael N. Taglich that by following that
procedure you can maximize your investment, he urges you to support the adoption
of the proposal.
THE SECOND PROPOSAL is to amend the Corporation's by-laws to provide that
stockholders owning at least ten (10%) percent of the Corporation's stock shall
have the right to require that the Corporation hold a special meeting of
stockholders. Under the Corporation's By-laws as currently written, stockholders
of the Corporation have no right to cause the Corporation to call a special
meeting of stockholders. Currently, special meetings can only be called by the
President, Chairman of the Board or by a majority of the members of the Board.
The Board, which is elected by the stockholders, should listen and be receptive
to the request for special meetings by stockholders having a significant
interest in the Corporation in order to give prompt and timely consideration to
matters that stockholders deem important to their interests and not be required
to wait until the next annual meeting. The lapse of time could be prejudicial.
Moreover,
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Section 109 of the Delaware General Corporation Law provides that the power to
amend the by-laws is in the stockholders.
Michael N. Taglich urges you to support the above proposal.
VOTING PROCEDURES
The shares of Common Stock are the only shares of capital stock of the
Corporation entitled to vote on any of the proposals set forth above under "THE
PROPOSALS". Every holder of Common Stock is entitled to one (1) vote for each
share of Common Stock held. In accordance with the Corporation's By-laws, at the
1996 Annual Meeting, the holders of a majority of the Common Stock issued and
outstanding and entitled to vote thereto, present in person or represented by
proxy, shall be required for the purpose of a quorum. For the proposals set
forth above under "THE PROPOSALS" to be adopted at the 1996 Annual Meeting, it
will be necessary that each proposal receive the affirmative vote of a majority
of the shares of Common Stock present in person or represented by proxy at the
1996 Annual Meeting and entitled to vote. IT IS, THEREFORE, OF THE UTMOST
IMPORTANCE, IF YOU ARE IN FAVOR OF THE PROPOSALS, THAT YOU PROMPTLY SIGN AND
RETURN THE ENCLOSED BLUE PROXY CARD.
Abstentions and broker non-votes are not votes cast and, therefore, will not
be counted in determining voting results, although abstentions and broker
non-votes will be counted in the determination of a quorum. Inspectors of
election that are appointed by the Board of Directors or, if no such appointment
if made, by the presiding officer of the Corporation at the 1996 Annual Meeting,
will tabulate the votes cast.
Only holders of record as of the close of business on the record date (to be
set by the Corporation) will be entitled to vote. If you are a stockholder of
record on the record date, you will retain your voting rights for the 1996
Annual Meeting even if you sell such shares after the record date. Accordingly,
it is important that you vote the shares you own on the record date or grant a
proxy to vote such shares on the blue proxy card, even if you sell such shares
after the record date.
If any of your shares of Common Stock are held in the name of a brokerage
firm, bank, bank nominee or other institution on the record date, only it can
vote such shares of Common Stock and only upon receipt of your specific
instructions. Accordingly, please contact the person responsible for your
account and instruct that person to execute the blue proxy card on your behalf.
SOLICITATION OF PROXIES
Proxies may be solicited by mail, courier service, advertisement, telephone,
telecopier, or in person. Solicitations will be made by Michael N. Taglich, who
will not receive compensation for such solicitation. Michael N. Taglich may
request banks, brokerage firms, and other custodians, nominees, and fiduciaries
to forward all of the solicitation materials to the beneficial owners of the
shares they hold of record. Michael N. Taglich will reimburse these record
holders for customary clerical and mailing expenses incurred by them in
forwarding these materials to their customers. The entire expense of the
solicitation of proxies by Michael N. Taglich for the 1996 Annual Meeting will
be borne by Michael N. Taglich. At present, Michael N. Taglich does not intend
to seek reimbursement for such expenses from the Corporation or any other party
or parties. Michael N. Taglich estimates that the costs incidental to the
solicitation of proxies for the 1996 Annual Meeting, including expenditures for
printing, postage, legal and related expenses will be approximately $40,000.
Total costs incurred to date in furtherance of and in connection with the
solicitation of proxies by Michael N. Taglich are approximately $15,000.
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ADDITIONAL INFORMATION
Questions, or requests for additional copies of materials, should be
directed to Michael N. Taglich, 100 Wall Street, 10th Floor, New York, New York
10005, Telephone No. (212) 479-7112 and Fax No. (212) 509-6587.
MICHAEL N. TAGLICH URGES ALL STOCKHOLDERS TO CHECK THE BOX MARKED "FOR" EACH
PROPOSAL, DATE, SIGN, AND RETURN THE ENCLOSED BLUE PROXY CARD IN THE ENCLOSED
POSTAGE PREPAID ENVELOPE. IF NO MARK IS MADE, YOU WILL BE DETERMINED TO HAVE
GIVEN A DIRECTION TO VOTE THE SHARES REPRESENTED BY THE BLUE PROXY CARD FOR THE
PROPOSALS SET FORTH ABOVE UNDER THE SECTION "THE PROPOSALS", PROVIDED THAT YOU
HAVE SIGNED THE BLUE PROXY CARD.
MICHAEL N. TAGLICH
October 21, 1996
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PROXY CARD
ECC INTERNATIONAL CORP.
1996 ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED BY MICHAEL N. TAGLICH
The undersigned, is the record holder of Common Stock, par value, $0.10
per share (the "Shares") of ECC International Corp., a Delaware corporation
("Corporation") AND hereby appoints MICHAEL N. TAGLICH for and in the name
of the undersigned, to represent and to vote as designated below, all Shares
that the undersigned is entitled to vote, as if personally present at the
1996 Annual Meeting or Stockholders of the Corporation, and at any
adjournment, postponement or rescheduling thereof. The undersigned hereby
revokes any previous proxies with respect to the matters covered by this
Proxy.
MICHAEL N. TAGLICH RECOMMENDS A VOTE "FOR" ITEMS "1" AND "2" BELOW.
Please mark, sign, date and return this Proxy Card promptly in the
postage-paid envelope enclosed.
(Continued and to be signed on the reverse side.)
/X/ PLEASE MARK YOUR VOTES AS IN THIS EXAMPLE.
FOR AGAINST ABSTAIN
1. RESOLVED, that it is the sense of the / / / / / /
stockholders of ECC International Corp.,
expressed at its annual meeting held
December 1996, that the Corporation and/or
its businesses be sold so as to maximize the
return to stockholders and that the same be done
as expeditiously as is consistent therewith,
and to that end, the Board of Directors
is requested to cause the Corporation to
engage an
independent nationally recognized investment
banking firm to assist the Board in seeking to
obtain a purchaser or purchasers on terms and
conditions that the Board deems expedient and in
the best interests of the Corporation and to
submit the same to the stockholders for their
authorization.
2. RESOLVED, that Article II, Section 7 of the / / / / / /
By-laws of the Corporation be amended by adding
the following provisions to the end thereof:
"A special meeting of the stockholders, for any
purpose or purposes, unless otherwise prescribed
by statute or by the Certificate of Incorporation,
shall be called by the Corporation upon written
notice from stockholders owning not less than ten
(10%) percent of the Corporation's outstanding
shares of voting stock, which notice shall set
forth the purpose or purposes of such special
meeting and the Corporation shall hold the
special meeting of stockholders no later than
thirty (30) days after the date such notice is
received by the Corporation. Notwithstanding
anything to the contrary contained
in Article X, Section 1 of the By-laws of the
Corporation, this By-law may not be amended without
the affirmative vote of a majority of shares of
voting stock present in person or represented by
proxy at a meeting of the Corporation's stockholders
and entitled to vote on the matter.
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This proxy, when properly executed, will be voted in
the manner directed herein by the undersigned
stockholder. If no mark is made, this proxy will be
determined to be directed to vote "FOR" the above
proposals.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
SIGNATURE(S) DATE
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NOTE: Please sign exactly as name appears. When
shares are held as joint tenants, both should sign.
When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such.
If a corporation, please sign in full corporate name
by president or other authorized officer and if a
partnership, please sign in the partnership name by
authorized person.
