[PRELIMINARY PROXY]
EMCEE BROADCAST PRODUCTS, INC.
P.O. Box 68
White Haven, Pennsylvania 18661-0068
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
AUGUST 26, 1996
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders of EMCEE Broadcast Products,
Inc. will be held at the Pocono Ramada Inn, Route 940, White
Haven, Carbon County, Pennsylvania, on August 26, 1996 at 11:00
A.M., E.D.S.T., for the purpose of considering and acting upon
the following:
1. The election of a Board of Directors;
2. The approval of a proposal to amend the Company's Certificate
of Incorporation by deleting Article "TWELFTH" therefrom, which
requires the affirmative vote of not less than 80% of the
outstanding voting shares of the Company to authorize certain
corporate action;
3. The approval of a proposal to adopt the 1996 EMCEE Broadcast
Products Stock Option Plan, a copy of which is attached as
Appendix A to the Proxy Statement;
4. The ratification of the appointment of Kronick Kalada Berdy &
Co. as independent auditors to audit the financial statements of
the Company for fiscal year 1997; and
5. Such other business as may properly come before the Annual
Meeting, or any adjournment thereof.
The Board of Directors has fixed the close of business on July
15,1996, as the record date for the determination of stockholders
entitled to notice of and to vote at the Annual Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
Martin D. Cohn,
Secretary
White Haven, Pennsylvania
July 29, 1996
<PAGE>
YOUR VOTE IS IMPORTANT
----------------------
The Board of Directors considers the vote of each stockholder to
be important, regardless of the number of shares held. You are
urged to date, sign and promptly return your proxy so that your
shares may be voted in accordance with your wishes and in order
that the presence of a quorum may be assured at the Annual
Meeting. The giving of your proxy does not affect your right to
vote in person in the event you attend the Annual Meeting.
<PAGE>
PROXY STATEMENT
---------------
This Proxy Statement is furnished to stockholders in connection
with the solicitation of proxies by the Board of Directors of
EMCEE Broadcast Products, Inc. (the "COMPANY"), for use at the
Annual Meeting of Stockholders of the Company to be held on
August 26, 1996, or at any adjournment thereof, for the purposes
set forth in the accompanying Notice of Annual Meeting of
Stockholders and in this Proxy Statement. It is intended that
this Proxy Statement and the enclosed proxy will be first sent to
stockholders on or about July 29, 1996.
Proxies in the accompanying form, which are duly executed and
returned pursuant to this solicitation, will be voted at the
Annual Meeting and, where a choice is specified, will be voted in
accordance with the specification made. Any stockholder who gives
a proxy has the power to revoke it by notice to the Secretary at
any time before it is exercised. A later dated proxy will revoke
an earlier proxy, and stockholders who attend the Annual Meeting
may, if they wish, vote in person even though they may have
submitted a proxy, in which event the proxy will be deemed to
have been revoked.
The Company will pay all expenses connected with this
solicitation of proxies. In addition to solicitations by mail,
officers, directors and regular employees of the Company may,
without additional compensation, solicit proxies on behalf of the
Company in person or by telephone. The Company also expects to
reimburse its transfer agent, Harris Trust and Savings Bank, for
its reasonable out-of-pocket expenses in forwarding proxy
materials to stockholders.
In addition, the Company has engaged Proxy Services, Inc. ("PROXY
SERVICES") to assist in the solicitation of proxies. Proxy
Services has advised the Company that its services will include
forwarding proxy materials to brokers, banks and other
institutions and, thereafter, contacting them by telephone to
assure that such proxy materials have been received. Proxy
Services' aggregate fee of $1,000 for these services and its out-of-pocket
expenses will be paid by the Company.
The Company has only one class of capital stock, which is common
stock ("COMPANY STOCK"). Only stockholders of record at the close
of business on July 15, 1996, are entitled to vote at the Annual
Meeting. On that date there were 4,156,935 shares of Company
Stock issued and outstanding, with an additional 210,579
<PAGE>
shares held as treasury stock. Stockholders are entitled to one
vote for each share of Company Stock held on all matters to be
considered and acted upon at the Annual Meeting and do not have
cumulative voting rights in the election of directors.
The Annual Report to Stockholders for fiscal year ended March 31,
1996, which includes audited, consolidated financial statements,
is being mailed herewith to all stockholders of record as of the
close of business on July 15, 1996. The Board urges every
stockholder to carefully review the Annual Report to Stockholders
and this Proxy Statement.
BENEFICIAL OWNERSHIP OF STOCK
----------------------------
Under the proxy rules of the Securities and Exchange Commission
(the "SEC"), a person who directly or indirectly has or shares
voting power and/or investment power with respect to a security
is considered as a beneficial owner of the security. Voting power
includes the power to vote or direct the voting of shares, and
investment power includes the power to dispose of or direct the
disposition of shares.
Management
The following table provides information, as of July 15, 1996, on
the beneficial ownership of Company Stock held by all directors
and the President/CEO (by naming them), and by all directors and
executive officers as a group (without naming them), as reported
by each such person.
AMOUNT AND NATURE
NAME OF OF BENEFICIAL PERCENTAGE
BENEFICIAL OWNER OWNERSHIP OF CLASS
- ----------------------------------------------------------
James L. DeStefano 59,510(1)(2) 1.43%
Joe B. Hassoun 14,694(1)(2)less than 1.00%
Michael J. Leib 3,452 less than 1.00%
Richard J. Nardone - 0 - 0%
Evagelia R. Rogiokos 120,836(3) 2.91%
Leonard S. Teven 29,369(1) less than 1.00%
All directors and
executive officers
as a group 274,817(1) 6.61%
<PAGE>
(1) Includes shares which may be acquired within 60 days upon the
exercise of outstanding stock options granted under the Company's
1985 and 1988 Stock Option Plan: Mr. DeStefano, 13,334 shares;
Mr. Hassoun, 7,583 shares; Mr. Teven, 7,583 shares; and all
directors and executive officers as a group, 31,467 shares.
(2) Includes shares registered jointly with spouse.
(3) Includes 510 shares held in 6 custodial accounts, although
Mrs. Rogiokos disclaims beneficial ownership of these shares, and
39,715 shares held in the name of the Estate of Mrs. Rogiokos'
late husband, Rigas Rogiokos, over which she has voting and
investment power.
Other Beneficial Owners
The following table provides information, as of July 15, 1996, on
the beneficial ownership of more than five percent of Company
Stock held by persons who are not directors or executive
officers:
AMOUNT AND NATURE
NAME AND ADDRESS OF OF BENEFICIAL PERCENTAGE
BENEFICIAL OWNER OWNERSHIP OF CLASS
- ---------------------------------------------------------------
Cellular Financial Services, Inc. 233,600 5.62%
P.O. Box 2688
Crossville, TN 38557(1)
Estate of Shirley Chalmers 344,970 8.30%
c/o Burton T. Witt, Esquire
Suite 3900
One North LaSalle Street
Chicago, IL 60602 (2)
Kennedy Capital Management, Inc. 225,000 5.41%
424 North New Ballas Road
St. Louis, MO 63141-6821(3)
(1) Information obtained from a Schedule 13D filed with the SEC
on November 13, 1991.
(2) Information obtained from an amended Schedule 13D filed with
the SEC on June 7, 1996. According to the amended Schedule 13D,
the Executor, Burton T. Witt, has sole voting power and shares
dispositive power with Martin D. Cohn with respect to these
shares. The amended 13D also discloses that the beneficiary with
respect to these shares is the Weizmann Institute of Science.
<PAGE>
(3)Information obtained from a Schedule 13G filed with the SEC on
or about February 8, 1996. The 13G indicates that Kennedy Capital
Management, Inc. shares voting and dispositive power with
discretionary accounts with respect to these shares.
ELECTION OF DIRECTORS
---------------------
Nominees
The following information concerns nominees to the Board of
Directors. Unless authority to so vote is withheld, it is
intended that proxies solicited hereby will be voted for the
election of the six nominees named in the table below. Those
elected will serve until the next Annual Meeting of Stockholders
and until their successors are elected and qualify.
POSITIONS/OFFICES WITH COMPANY;
BUSINESS EXPERIENCE; OTHER
NOMINEE DIRECTOR SINCE DIRECTORSHIPS; AND AGE
- -----------------------------------------------------------------
James L. DeStefano 1992 President/CEO of the Company
since June, 1992; Vice
President of Comark
Communications,
Inc. (high power TV broadcast
equipment manufacturer)
from prior to 1991 to June,
1992; Age 51.
Joe B. Hassoun 1991 Independent computer consultant
since prior to 1991; Since
April, 1995, President
of Infotronic Systems,
Inc. (computer consulting
company and developer of
computer software
Applications); Age 38.
Michael J. Leib 1995 Chief Executive Officer of
Weatherly Casting and Machine
Company (foundry and
manufacturer of mining
and power generation
related equipment)
since prior to 1991;
Director of First Federal
Savings & Loan Association
of Hazleton and Vibra-Tech
Engineers, Inc.; Age 47.
<PAGE>
Richard J. Nardone 1995 President of IMG Management
Services Corporation (human
resource consulting business)
and Director of Plastic
Companies Enterprises (plastics
manufacturer) since prior
to 1991; Age 44.
Evagelia R. Rogiokos 1992 Private investor since
prior to 1991; Age 55.
Leonard S. Teven 1985 President of Target
Communications, Inc.
(advertising company) since
prior to 1991; Age 60.
All of the nominees to be elected at the Annual Meeting are
currently directors of the Company and, with the exception of Mr.
Nardone, were elected by vote of the stockholders. In accordance
with the Company's by-laws, Mr. Nardone was elected a director by
the Board of Directors on November 13, 1995.
The Company's by-laws provide for a minimum of three and a
maximum of ten directors. Proxies cannot be voted for a greater
number of persons than those nominated. In the event any nominee
would become unable to serve as a director, the persons named in
the proxy will vote for such substitute nominee, if any, which
the Board of Directors may designate.
Vote Required
Only affirmative votes are counted in the election of directors.
The six nominees for election as directors at the Annual Meeting
who receive the greatest number of votes cast for the election of
directors by the holders of Company Stock present in person or
represented by proxy and entitled to vote at the Annual Meeting,
a quorum being present, will be elected as directors.
The Board of Directors recommends that you vote "FOR" the six
nominees.
Board Meetings; Compensation of Directors
During fiscal year 1996, the Board of Directors met four times.
Each director attended all of those meetings held during the
period for which he served as a director, as well as all of the
meetings held by each standing committee on which he served
during the periods in which he served.
<PAGE>
Each member of the Board of Directors, with the exception of the
President/CEO, was entitled to and received $2,500 for each Board
Meeting attended during fiscal year 1996. The Company also pays
all travel, accommodation and related expenses which are incurred
by Board members in attending Board meetings. There is no
additional compensation paid to Board members when they sit as
members of a standing committee.
Members of the Board of Directors are also eligible to
participate in and receive stock options under the Company's 1988
Stock Option Plan. Stock options under the 1988 Stock Option Plan
are also available to officers and certain other employees of the
Company, and are granted under the provisions of the Plan in the
discretion of the Board of Directors or a committee thereof.
Board Committees
The Board of Directors has standing audit, compensation and
nominating committees. Each committee meets at least once a year.
During fiscal year 1996, the Nominating Committee and the
Compensation Committee met once, and the Audit Committee met
twice. On March 4, 1996, the Board also established a Stock
Option Committee, which did not meet during fiscal year 1996.
Richard J. Nardone (Chairman), Michael J. Leib, Leonard S. Teven,
Evagelia Rogiokos and Joe B. Hassoun are the members of the Audit
Committee. The Audit Committee's function includes, but is not
limited to, reviewing the scope of the audit program to assure
that audit coverage and controls are satisfactory, and reviewing
the Company's financial statements with representatives of the
independent auditors.
All of the directors (Mr. Leib : Chairman) are members of the
Compensation Committee, except that the President/CEO may not
serve or vote on matters regarding his compensation as an officer
of the Company. The Compensation Committee determines the
compensation for all officers.
Mr. Hassoun (Chairman), Mr. Leib, Mrs. Rogiokos, Mr. Teven and
Mr. Nardone are members of the Nominating Committee. The
Nominating Committee is responsible for nominating persons to
serve on the Board of Directors of the Company and considers
nominees for Board membership recommended by stockholders if made
in the manner and within the period of time required below for
the submission of stockholder proposals. The Nominating Committee
is empowered to determine the type of supporting information and
data required to be submitted with any nomination.
James L. DeStefano (Chairman) and Mrs. Rogiokos are members of
the Stock Option Committee. The Stock Option Committee may be
responsible for administering any or all of the Company's Stock
Option Plans.
<PAGE>
IDENTIFICATION OF EXECUTIVE OFFICERS
------------------------------------
As of July 15, 1996, the following individuals served as
executive officers of the Company. All such officers, subject to
the provisions of the by-laws of the Company, serve one year
terms of office and are elected by the Board of Directors at a
meeting thereof held immediately following the Annual Meeting of
Stockholders.
POSITIONS/OFFICES WITH
NAME COMPANY; BUSINESS EXPERIENCE; AND AGE
- -----------------------------------------------------------
Martin D. Cohn Secretary of the Company and attorney
at law since prior to 1991;
Director and Secretary of Vibra-Tech
Engineers, Inc.; Chairman of the
Board of Blue Cross of Northeastern
Pennsylvania; Age 70.
James L. DeStefano See nominee table above.
Allan J. Harding Vice President-Finance of the
Company since 1992; Controller
of the Company, 1991-1992;
Controller of Stroud's, Inc.
(consumer retail business)
since prior to 1991; Age 60.
Robert G. Nash Vice President/Director of
Engineering of the Company since
1985; Age 49.
John Saul Vice President/Director of
Systems Engineering of the
Company since 1985; Age 54.
Perry Spooner Vice President-International
Sales of the Company since June,
1995; Vice President/Director of
International Systems Engineering
of the Company from 1985 to 1995;
Age 54.
<PAGE>
Compensation of Executive Officers
The following table sets forth information concerning the annual,
long term and other compensation of the person holding the
position of President/CEO of the Company as of the end of fiscal
year 1996, for services rendered in all capacities to the Company
for fiscal years 1994, 1995 and 1996. Information is not required
as to the compensation of the Company's next four highest paid
executive officers because the total salary and bonus earned by
each such executive officer during fiscal year 1996 did not
exceed $100,000.
SUMMARY COMPENSATION TABLE
Annual Compensation
-------------------
Name and Fiscal Other Annual
Principal Year Salary Bonus Compensation
Position ($) ($) ($)
- ------------------------------------------------------------
James L. DeStefano,1996 $124,954 $25,000 -------
President/CEO 1995 $118,031 $30,000 -------
1994 $107,956 $ 5,000 -------
Long Term Compensation
----------------------
Awards Payouts
------ -------
Restricted Options LTIP All other
stock awards (#) Payouts compensation
($) ($) ($)
- --------------------------------------------------------------
1996 ------ ------ ------ $12,130 (2)
1995 ------ 20,000 (1) ------ $10,273 (2)
1994 ------ ------ ------ $11,262 (2)
(1) Represents the number of shares for which a stock option was
granted in June, 1994, under the Company's 1988 Stock Option
Plan. No stock appreciation rights (SARs) were granted in
conjunction with this stock option.
(2) Represents amounts paid by the Company for hospitalization
and dental coverage ($4,616 in fy 1994; $3,627 in fy 1995; and
$5,502 in fy 1996 ), life insurance premiums ($594 in fy's 1994
<PAGE>
and 1995; and $576 in fy 1996), and lease payments for Company
vehicle utilized ($6,052 in fy's 1994,1995 and 1996).
Stock Option Grants
There were no stock options granted to the person named in the
Summary Compensation Table above during fiscal year 1996.
Accordingly, the Option Grants Table has been omitted from this
Proxy Statement.
Option Exercises and Values
The following table sets forth, as to the person named in the
Summary Compensation Table above, information with respect to
shares acquired through the exercise of stock options and the
number of shares (and their values) covered by unexercised stock
options held at the end of fiscal year 1996. There are no SARs
available with these stock options.
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1996
AND FISCAL YEAR-END OPTION VALUES
NUMBER OF VALUE OF
UNEXERCISED IN-THE-MONEY
OPTIONS OPTIONS
AT FY AT FY
SHARES
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($)UNEXERCISABLE UNEXERCISABLE
- ---------------------------------------------------------------
James L.
DeStefano, 13,334/ $90,005/
President/CEO 5,000 $31,250(1) 6,666 $44,496(2)
(1) Based on the NASDAQ Stock Market closing bid price on the
exercise date.
(2) Based on the NASDAQ Stock Market closing bid price on March
29, 1996.
<PAGE>
Pension Plans, Long Term Incentive
Plans and Option/SAR Repricing
The Company does not have a pension or other defined benefit or
actuarial retirement plan for its directors, officers or
employees, nor does it have in place any long-term incentive
plans. In addition, no action was taken in fiscal year 1996 to
lower the exercise price of an option or SAR.
Employment Contracts and Termination of
Employment and Change-In-Control Arrangements
The Company has entered into a Change in Control Agreement with
Mr. DeStefano, the person who is named in the Summary
Compensation Table above. The Agreement is for a term of 5 years
from December 28, 1995. Generally, change in control benefits
accrue to Mr. DeStefano under the Agreement if (1) his employment
with the Company is terminated, or (2) he experiences a decrease
in his compensation of 3% or more or (3) he is required to
relocate his place of employment outside of a 50 mile radius of
White Haven, Pennsylvania, at any time within a 24-month period
following a "change in control" of the Company, which is
specifically defined in the Agreement. Subject to certain
limitations and restrictions set forth in the Agreement, the
maximum change in control benefit Mr. DeStefano would be entitled
to receive thereunder would be two times his average aggregate
compensation -- which includes all monetary compensation plus
the monetary value of any perquisite or fringe benefit (excluding
stock options and restricted stock awards) not available to all
other full time Company employees on substantially the same terms
and conditions -- for the two years immediately preceding the
accrual of the change in control benefit. The Agreement also
restricts Mr. DeStefano's right to compete against the Company
and his disclosure of confidential or proprietary Company
information.
PROPOSAL TO APPROVE AMENDMENT TO THE CERTIFICATE OF INCORPORATION
- -----------------------------------------------------------------
Proposal
The Company is proposing to amend its Certificate of
Incorporation by deleting Article "TWELFTH" therefrom. Article
TWELFTH, as currently set forth in the Certificate of
Incorporation, is as follows:
<PAGE>
"ARTICLE TWELFTH: Except as set forth in (d) below, the
affirmative vote of the holders of not less than 80% of the
outstanding shares of the Corporation entitled to vote at an
election of directors shall be required to authorize any of the
following items of business:
(a) any merger or consolidation of the Corporation into or with
any other corporation;
(b) any sale, lease, exchange, or other disposition of all or
substantially all of the assets of the Corporation to any other
corporation, person or entity;
any purchase, lease or acquisition by the Corporation of any of
its subsidiaries of any assets or securities of the Corporation
or any of its subsidiaries; or
(d) any amendment of the Certificate of Incorporation which
changes the percentage of votes of shareholders required for the
transaction of any business or of any specified item of business,
including, without limitation, amendments to the Certificate of
Incorporation, unless such item of business has been authorized
by a majority of the entire Board of Directors of the
Corporation, in which latter event the approval of the holders of
not less than a majority of the shares of the Corporation present
and entitled to vote at a meeting of shareholder called for that
purpose shall be required to authorize any of the transactions
set forth in clauses (a), (b) or (d) hereof and no such approval
of shareholders shall be required to authorize any of the
transactions set forth in clause (c) hereof."
Discussion
The Company's management believes that Article TWELFTH, in its
present form, is unduly cumbersome and not in keeping with the
general corporate principal of majority rule. The Company's
management further believes that the super majority vote
requirement of this Article, as it relates to specific
fundamental corporate changes, may unreasonably interfere with
the taking of action which is in the Company's best interests and
could, in any event, be circumvented by third parties. It is
relevant to note that the provisions of this Article have never
been invoked since its adoption in 1982. It is also relevant to
note that the proposed amendment to delete Article TWELFTH was
passed unanimously by the full Board of Directors of the Company.
<PAGE>
Vote Required
Under Delaware law, the affirmative vote of the holders of a
majority of the shares of Company Stock present in person or
represented by proxy and entitled to vote at the Annual Meeting,
a quorum being present, is necessary to approve the proposed
amendment. An abstention from voting on a matter by a
stockholder present in person or represented by proxy and
entitled to vote, or a broker non-vote, has the same legal effect
as a vote "Against" the matter.
The Board of Directors recommends that you vote "FOR" the
proposed amendment. Unless otherwise directed therein, the
proxies solicited hereby will be voted for the proposed amendment
to the Certificate of Incorporation.
PROPOSAL TO APPROVE THE ADOPTION OF THE 1996 STOCK OPTION PLAN
--------------------------------------------------------------
Proposal
On June 3, 1996, the Board of Directors adopted, subject to
stockholder approval, the 1996 EMCEE Broadcast Products Stock
Option Plan (the "PLAN"). A copy of the Plan is set forth in its
entirety on Appendix A, which is attached hereto.
Discussion
All directors, officers and key management employees of the
Company or any of its subsidiaries are eligible to receive stock
options under the Plan.
The Plan was adopted by the Board to advance the interests of the
Company and its shareholders by affording eligible participants
the opportunity to become owners, or to increase their ownership
of, Company Stock, and to motivate and retain such individuals,
upon whose judgment, initiative, leadership and continued efforts
the success of the Company in large measure depends, as well as
to attract highly competent individuals to become directors,
officers and key management employees of the Company and its
subsidiaries.
The following summary of the Plan is qualified in its entirety by
reference to the full text of the Plan on Appendix A hereto.
<PAGE>
The Plan will be administered from time to time by the Board of
Directors or a designated committee of the Board. If the
administering body is a committee of the Board, all members
thereof must be non-employee directors. The administering body is
entrusted with, among other things, determining the times when
options will be granted, choosing those individuals to whom
options will be granted and the number of shares subject to each
such grant.
The maximum number of shares of Company Stock available for
options under the Plan, subject to certain antidilution and
enlargement provisions, may not exceed 100,000. The price per
share of Company Stock subject to each option shall be its "fair
market value" (as defined in the Plan) on the date the
administering body grants the option. The Company Stock subject
to each option will be registered under applicable federal and
state securities laws at or prior to the time the option may be
exercised, which may not occur until at least two years have
lapsed from the date the option was granted.
Each stock option granted under the Plan will be evidenced by a
Stock Option Agreement in form and content approved from time to
time by the administering body. The administering body is also
empowered to fix the expiration date of each option, which may in
no event exceed ten years from the date it was granted.
No option is transferable or assignable other than by will or the
laws of descent and distribution or pursuant to a "qualified
domestic relations order" (as defined in the Plan). The Plan also
provides for a 30-day option exercise period for optionees whose
employment or directorship ends with the Company while an option
remains available (if the optionee's Stock Option Agreement does
not otherwise provide), as well as a 180-calendar day expiration
date with respect to options which are outstanding when an
optionee dies.
Subject to the provisions of the Plan governing the earlier
termination thereof, the Plan will end and terminate on August
25, 2006, at 5:00 P.M. However, the term of a stock option may
extend beyond the Plan termination date if it was granted prior
thereto.
<PAGE>
New Plan Benefits
It is not possible to determine the benefits or amounts that will
be received by or allocated to eligible Plan participants or
which would have been received by or allocated to them during
fiscal year 1996 if the Plan had been in effect. Therefore, the
New Plan Benefits Table otherwise required by the proxy rules has
been omitted from this Proxy Statement.
Federal Income Tax Consequences
The following is a brief description of the federal income tax
consequences generally arising with respect to options that may
be granted under the Plan and the exercise of those options by
optionees. This discussion is intended for the information of
stockholders considering how to vote at the Annual Meeting and
not as tax guidance or a professional tax opinion to eligible
participants or future optionees of the Plan.
The grant of an option will create no tax consequences for the
optionee or the Company. Upon exercise of an option, the optionee
must generally recognize ordinary income equal to the fair market
value of the Company Stock acquired on the date of exercise minus
the exercise price, and the Company will be entitled to a
deduction equal to the amount recognized as ordinary income by
the optionee (the exercise of an option will also cause payroll
taxes to be payable). A disposition of shares acquired upon the
exercise of an option generally will result in short-term or
long-term capital gain or loss measured by the difference between
the sale price and the optionee's tax basis (such basis is
generally the exercise price plus the amount recognized as
ordinary income) in such shares. Generally, there will be no tax
consequences to the Company in connection with the disposition of
option shares.
Vote Required
Under Delaware law, the affirmative vote of the holders of a
majority of the shares of Company Stock present in person or
represented by proxy and entitled to vote at the Annual Meeting,
a quorum being present, is necessary to approve the adoption of
the Plan. An abstention from voting on a matter by a stockholder
present in person or represented by proxy and entitled to vote,
or a broker non-vote, has the same legal effect as a vote
"Against" the matter.
<PAGE>
The Board of Directors recommends that you vote "FOR" the
approval of the adoption of the Plan. Unless otherwise directed
therein, the proxies solicited hereby will be voted for the
approval of the adoption of the Plan.
RATIFICATION OF APPOINTMENT OF AUDITORS
---------------------------------------
The Board of Directors has appointed Kronick Kalada Berdy & Co.
as independent auditors to audit the financial statements of the
Company for fiscal year 1997.
A representative of Kronick Kalada Berdy & Co. is expected to be
present at the Annual Meeting and will be accorded the
opportunity to address the stockholders if desired. That
representative will also be available to respond to appropriate
questions from stockholders.
Kronick Kalada Berdy & Co. audited the financial statements for
fiscal year 1996.
Vote Required
Under Delaware law, the affirmative vote of the holders of a
majority of the shares of Company Stock present in person or
represented by proxy and entitled to vote at the Annual Meeting,
a quorum being present, is necessary for the ratification of the
appointment of Kronick Kalada Berdy & Co. An abstention from
voting on a matter by a stockholder present in person or
represented by proxy and entitled to vote, or a broker non-vote,
has the same legal effect as a vote "Against" the matter.
The Board of Directors recommends that you vote "FOR" the
ratification of the appointment of Kronick Kalada Berdy & Co.
Unless otherwise directed therein, the proxies solicited hereby
will be voted for the ratification of the appointment of Kronick
Kalada Berdy & Co. In the event the stockholders fail to ratify
the appointment, the Board of Directors will reconsider its
selection of independent auditors.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
----------------------------------------------
Martin D. Cohn, who is the Secretary of the Company, is the
President and a stockholder of the law firm of Laputka, Bayless,
Ecker & Cohn, P.C. In fiscal year 1996, the Company paid Laputka,
Bayless, Ecker & Cohn, P.C. the sum of $94,296 for legal services
rendered to the Company.
<PAGE>
SECTION 16(a) OF THE EXCHANGE ACT
---------------------------------
Section 16(a) of the Securities Exchange Act of 1934 requires
that directors and certain officers of the Company, and persons
who own more than ten percent of Company Stock, file reports of
ownership and changes in ownership with the SEC as to shares of
Company Stock beneficially owned by them. Based solely on its
review of copies of such reports received by it, the Company
believes that during fiscal year ended March 31, 1996, all such
filing requirements were complied with in a timely fashion.
1997 STOCKHOLDER PROPOSALS
--------------------------
Stockholder proposals for the 1997 Annual Meeting of Stockholders
must be submitted in writing and received by the Administrative
Assistant to the President/CEO at EMCEE Broadcast Products, Inc.,
P.O. Box 68, White Haven, PA 18661-0068, no later than April 1,
1997, in order to be eligible for inclusion in the Company's
Proxy Statement for the 1997 Annual Meeting.
OTHER BUSINESS
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The Board of Directors knows of no other matters which will be
brought before the Annual Meeting of Stockholders. If, however,
any other matter shall properly come before the Annual Meeting,
or any adjournment thereof, the persons named in the proxy will
vote thereon in accordance with their discretion and best
judgment.
BY ORDER OF THE BOARD OF DIRECTORS
Martin D. Cohn, Secretary
THE COMPANY FILES A FORM 10-KSB REPORT ANNUALLY WITH THE SEC. THE
FORM 10-KSB REPORT FOR FISCAL YEAR 1996 IS AVAILABLE WITHOUT
CHARGE BY WRITING TO THE COMPANY AT P.O. BOX 68, WHITE HAVEN,
PENNSYLVANIA 18661-0068, ATTENTION: ADMINISTRATIVE ASSISTANT TO
THE PRESIDENT/CEO.
<PAGE>
APPENDIX "A"
EMCEE BROADCAST PRODUCTS, INC.
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NONSTATUTORY STOCK OPTION PLAN
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THIS NONSTATUTORY STOCK OPTION PLAN (the "PLAN"), approved by the
affirmative vote of a majority of the stockholders of EMCEE
Broadcast Products, Inc. (the "COMPANY"), a Delaware corporation,
present in person or represented by proxy, at the 1996 Annual
Meeting of Stockholders on August 26, 1996 (the "EFFECTIVE
DATE"), in accordance with the applicable laws of the State of
Delaware.
ARTICLE I - DEFINITIONS
1.1The following is a list which sets forth the meaning of
certain terms used in this Plan which are not elsewhere defined
herein:
1.1.1"Administering Body" shall mean the Board or the Committee.
1.1.2"Board" shall mean the Board of Directors of the Company.
1.1.3"Code" shall mean the Internal Revenue Code of 1986, as
amended.
1.1.4"Committee" shall mean the Stock Option Committee of the
Board or such other committee of the Board, duly established and
constituted by the Board from time to time by resolution.
1.1.5"Company Stock" shall mean the common stock of the Company.
1.1.6"Date of Grant" shall mean the date on which the
Administering Body, by resolution, grants an Option to an
Optionee.
1.1.7"Fair Market Value" shall mean the average of the highest
and lowest prices per share of Company Stock on the NASDAQ
National Market or on such other market or exchange on which the
Company Stock is then traded, as reported in the Wall Street
Journal or such other journal or reporting service as the
Administering Body shall from time to time deem reliable; in the
absence of such a report on the Date of Grant in question, the
first preceding day on which there was such a report shall be
used.
1.1.8"1934 Act" shall mean the Securities Exchange Act of 1934.
1.1.9"Non-Employee Director" shall have the meaning ascribed to
it in Rule 16b-3 under the 1934 Act.
1.1.10 "Option" shall mean an option to purchase Company Stock
pursuant to the provisions of this Plan.
1.1.11 "Optionee" shall mean a person to whom an Option, which
has not expired or been terminated, has been granted under the
provisions of this Plan.
1.1.12 "Stock Option Agreement" shall mean a written instrument
approved by the Administering Body from time to time, setting
forth the terms and conditions under which an Optionee has been
granted an Option.
1.1.13 "Subsidiary" shall mean a subsidiary corporation of the
Company as defined in Section 424 of the Code.
<PAGE>
1.1.14 "Termination Date" shall mean August 25, 2006, at 5:00
P.M.
ARTICLE II - PLAN FORMATION; ELIGIBLE PARTICIPANTS
2.1This Plan shall be known as the "1996 EMCEE Broadcast Products
Stock Option Plan".
2.2Any director, officer or key management employee of the
Company or any Subsidiary shall be eligible to become an
Optionee.
2.3The purpose of this Plan is to advance the interests of the
Company and its shareholders by affording chosen directors,
officers and key management employees of the Company and its
Subsidiaries the opportunity to become owners, or to increase
their ownership of, Company Stock, and to motivate and retain
such individuals, upon whose judgment, initiative, leadership and
continued efforts the success of the Company in large measure
depends, as well as to attract highly competent individuals to
such positions.
2.4The Options are not "incentive stock options" within the
meaning of Section 422 of the Code.
2.5This Plan is intended to be a plan, the transactions of which,
as to directors and officers, shall be exempt from Section 16
(b) of the 1934 Act, pursuant to Rule 16b-3 under the 1934 Act.
2.6This Plan shall begin and take effect on the Effective Date
and shall end and terminate on and as of the Termination Date.
ARTICLE III - PLAN ADMINISTRATION
3.1This Plan shall be administered by the Administering Body. If
the Administering Body is the Committee, it shall report all
action taken by it to the Board. If the Administering Body is the
Committee, all members thereof must be Non-Employee Directors.
3.2Subject to the provisions of this Plan, the Administering Body
shall have full and final authority, in its discretion, to take
any and all actions and to make any and all determinations deemed
necessary or advisable for the proper administration of this
Plan, for which all such actions and determinations shall be
conclusively binding for all purposes and upon all persons and
entities, including, but not limited to:
3.2.1determining and choosing who will be Optionees;
3.2.2determining the time or times at which Options shall be
granted;
3.2.3determining the number of shares of Company Stock which
shall be subject to each Option;
3.2.4construing and interpreting this Plan; and
3.2.5determining the terms and conditions of Stock Option
Agreements, which need not be identical, including, but not
limited to, terms covering the payment of the "Option Price"
(defined hereinafter).
<PAGE>
3.3In determining and choosing who will be an Optionee, as well
as the number of shares of Company Stock covered by an Option
granted to each such Optionee, the Administering Body shall
consider such individual's position and responsibilities, the
nature and value to the Company or its Subsidiary of such
individual's services, such individual's present and/or potential
contribution to the success of the Company or a Subsidiary and
such other performance and contribution factors applicable to
such individual as the Administering Body may deem relevant.
ARTICLE IV - COMPANY STOCK SUBJECT TO OPTIONS;
OPTION PRICE; ANTIDILUTION
4.1Subject to Section 4.5 hereof, the aggregate number of shares
of Company Stock available for Options granted pursuant to this
Plan shall not exceed one hundred thousand (100,000).
4.2In the event of a forfeiture or rejection of an Option, or in
the event any Stock Option Agreement or Option shall terminate or
expire for any reason or be surrendered without having been fully
exercised, then, in any such event, the shares of Company Stock
subject thereto which were not purchased by the Optionee shall
again become available for Options to be granted subsequently
under this Plan.
4.3The Company Stock to be issued pursuant to the exercise of any
Option shall be registered under applicable federal and state
securities laws at or prior to the date on which the Option may
be exercised by the Optionee, and may come from authorized but
unissued shares or treasury stock.
4.4The price per share of Company Stock for which Options may be
granted hereunder (the "OPTION PRICE") shall be the Fair Market
Value thereof on the Date of Grant. If the Company Stock is at
any time traded on more than one market or exchange, the
Administering Body shall exercise its discretion in determining
which such market or exchange shall be used in determining Fair
Market Value.
4.5Subject to the provisions of Article VI hereof, in order to
prevent the enlargement or dilution of rights, in the event that
the outstanding shares of Company Stock are hereafter changed
into or exchanged for a different number or kind of shares or
other securities of the Company or of another corporation,
whether by reason of merger, consolidation, other reorganization,
recapitalization, reclassification, combination of shares, stock
split, stock dividend, subdivision, reverse split or otherwise,
the Administering Body shall, on the basis of a determination
made by the Company's independent auditors, which determination
shall be binding on the Company, its Subsidiaries and all
Optionees, proportionately adjust the aggregate number and/or
kind of shares available hereunder for Options as well as the
rights under outstanding Options granted hereunder, both as to
the number of shares and the Option Price.
<PAGE>
ARTICLE V - GENERAL TERMS AND CONDITIONS OF OPTIONS
5.1Each Option granted under this Plan shall be evidenced by a
Stock Option Agreement, which will incorporate by reference all
of the provisions of this Plan, and which must be duly executed
by the Company and the Optionee. The date of each Stock Option
Agreement shall be the Date of Grant of the Option therefor,
irrespective of the date of execution thereof. The Administering
Body shall have the discretion to cause a forfeiture of the grant
of any Option if the Optionee has not executed and delivered the
Stock Option Agreement by a date certain specified by the
Administering Body, which shall in no event be less than seven
(7) calendar days from the date the Stock Option Agreement is
delivered to the Optionee for execution.
5.2The Expiration Date of each Option shall be fixed by the
Administering Body, but such expiration date shall not exceed ten
(10) years from the Date of Grant. Provided that the Date of
Grant of an Option shall precede the Termination Date, the
expiration date thereof may be subsequent to the Termination
Date.
5.3Notwithstanding any possible contrary interpretation of any
provision set forth in this Plan or any Stock Option Agreement,
neither this Plan nor any Stock Option Agreement shall entitle an
Optionee to any of the rights of a stockholder of the Company. No
Optionee shall have any such rights unless and until duly
authorized certificates evidencing the shares of Company Stock
purchased are delivered to the Optionee.
5.4An Option may be exercised all at one time or in part from
time to time, at the discretion of the Optionee, during the term
thereof; provided, however, that each Stock Option Agreement
shall provide that no Optionee may exercise an Option, in whole
or in part, until at least two (2) years have expired from the
Date of Grant; and provided further that no partial exercise of
an Option may be for less than one hundred (100) shares of
Company Stock or, if less are available, the number of shares
remaining available thereunder.
5.5Subject to the expiration date thereof and the provisions of
this Plan, each Option shall be exercisable during the Optionee's
lifetime only by the Optionee. No Option shall be transferable or
assignable by an Optionee other than by will or the laws of
descent and distribution or pursuant to a "qualified domestic
relations order" as defined by the Code or Title I of the
Employee Retirement Income Security Act ("ERISA"), or the rules
thereunder. Except as expressly permitted herein, an Option shall
terminate and become null and void if it or the Stock Option
Agreement therefor is transferred, assigned, pledged or
hypothecated in any way or becomes subject to any security
interest, lien or other encumbrance, or to levy, execution,
attachment or similar process.
<PAGE>
5.6Upon termination of an Optionee's employment with the Company
or its Subsidiary, or the date on which he ceases to be a
director, as the case may be, the Optionee's rights and
privileges with respect to an Option granted to him pursuant to
this Plan shall be limited in the manner set forth in his Stock
Option Agreement or, if not specified therein, to the shares of
Company Stock subject to an Option or Options which were
exercisable by him on the date of such termination or cessation,
with such Option rights and privileges to expire and the Stock
Option Agreement(s) therefor to terminate in thirty (30) calendar
days from such date.
5.7If an Optionee shall die while all or any part of an Option
granted to him under this Plan remains outstanding, then,
notwithstanding Section 5.5 hereof, such Optionee's personal
representative shall have one hundred eight (180) calendar days
from the date of the Optionee's death to exercise such Option, to
the extent it is exercisable during such time, after which such
Option shall expire and the Stock Option Agreement therefor shall
terminate.
ARTICLE VI - FUNDAMENTAL CHANGES
6.1Notwithstanding any other provision contained in this Plan or
in any Stock Option Agreement, in the event the Company resolves
to (1) consolidate or merge with or into another corporation, (2)
accept an offer to purchase thirty (30%) percent or more of the
then issued and outstanding Company Stock, (3) sell all or
substantially all of its assets, or (4) voluntarily or
involuntarily dissolve or liquidate, then, in any such event, the
Administering Body may terminate all Options then outstanding in
whole or in part and the Stock Option Agreements therefor after
having given thirty (30) days advance written notice to each
Optionee, during which time each such Optionee shall have the
right to exercise, to the extent then exercisable, his Option or
Options in accordance with this Plan and his Stock Option
Agreement(s).
ARTICLE VII - TERMINATION; AMENDMENT
7.1Except as otherwise required by applicable law, the Board may
at any time, upon recommendation of the Committee, if the
Committee is then the Administering Body, but otherwise in its
sole discretion, terminate and in any respect amend this Plan;
provided, however, that no such action without approval of the
majority of the stockholders of the Company may increase the cost
of this Plan to the Company or alter the allocation of the
benefits hereunder; and provided further, however, that no
termination, except as provided in Article VI hereof, or
amendment of this Plan shall in any manner affect any Option
granted under this Plan which is then outstanding, without the
consent of the Optionee.
<PAGE>
ARTICLE VIII - MISCELLANEOUS
8.1Nothing in this Plan or in any Stock Option Agreement shall
confer upon any Optionee the right to continue in the Company's
or any Subsidiary's employ, or to continue to be engaged as a
director thereof, as the case may be.
8.2The adoption of this Plan shall not affect any other stock
option, incentive or other compensation plan of the Company or
any Subsidiary, nor shall this Plan preclude the Company or any
Subsidiary from establishing any such plan for its directors,
officers or employees in the future.
8.3This Plan shall be binding upon the Company and its successors
and assigns and, subject to the restrictions and limitations
contained in Sections 5.5 -- 5.7 hereof, inclusive, each Optionee
and his heirs, personal representatives and assigns. The Company
shall provide each Optionee with a copy of this Plan at the time
the Optionee's Stock Option Agreement is delivered to him for
execution, and each such Optionee shall be deemed to have
accepted and agreed to each of the provisions of this Plan by
virtue of his execution of such Stock Option Agreement.
8.4Any conflicts or inconsistencies between this Plan and any
Stock Option Agreement shall be resolved in favor of this Plan.
8.5Whenever used herein nouns in the singular shall include the
plural, and the masculine pronoun shall include the feminine
gender.
8.6The Article titles set forth in this Plan are inserted for
convenience and reference only and shall not be considered to
constitute a part of this Plan or limit, expand or change any of
the provisions of this Plan.
<PAGE>
(APPENDIX "B" - Proxy Card)
(PRELIMINARY COPY)
PROXY
EMCEE Broadcast Products, Inc.
P.O. Box 68
White Haven, PA 18661
This Proxy is Solicited on Behalf of the Board of Directors.
The undersigned hereby appoints James L. DeStefano and Martin D.
Cohn as Proxies, each with the power to appoint his substitute,
and hereby authorizes them to represent and to vote, as
designated below, all the shares of common stock of EMCEE
Broadcast Products, Inc. held on record by the undersigned on
July 15, 1996, at the Annual Meeting of Shareholders to be held
on August 26, 1996, or any adjournments thereof.
1. Election of Directors FOR all nominees below Withhold
(except as marked to Authority
the contrary below) to vote for
all nominees
listed
below
(Instructions: To withhold authority to vote for any individual
nominee, strike a line through the nominee's name as shown
below.)
James L. DeStefano, Joe B. Hassoun, Michael J. Leib, Richard J.
Nardone, Evagelia R. Rogiokos, Leonard S. Teven
2. Proposal to amend the Corporation's Certificate of
Incorporation by deleting Article "TWELFTH" therefrom.
FOR AGAINST ABSTAIN
3. Proposal to adopt the 1996 EMCEE Broadcast Products Stock
Option Plan.
FOR AGAINST ABSTAIN
4. Proposal to ratify the appointment of Kronick Kalada Berdy
and Company as the independent auditors of the corporation.
FOR AGAINST ABSTAIN
5. In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the Meeting.
<PAGE>
This proxy when properly executed will be voted in the manner
directed herein by the undersigned stockholder. If no direction
is made, this proxy will be voted for Proposals 1, 2, 3 and 4.
Please sign exactly as name appears below. When shares are held
by joint tenants, both should sign. When signing as attorney, as
executor, administrator, trustee or guardian, please give full
title as such. If a corporation, please sign in full corporate
name as President or other authorized officer. If a partnership,
please sign in partnership name by authorized person.
------------------------
Signature
DATED: , 1996
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PLEASE MARK, SIGN, DATE AND
RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE
-------------------------
Signature if held jointly
