SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange
Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
SCIENCE DYNAMICS CORPORATION
- ----------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
SCIENCE DYNAMICS CORPORATION
- -----------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
/ / $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:
- ------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
- ------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
- ------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
- ------------------------------------------------------------------------ *
Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / 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:
- ------------------------------------------------------------------------
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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<PAGE>
SCIENCE DYNAMICS CORPORATION
CHERRY HILL, NEW JERSEY
_______________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 7, 1996
_______________________________
TO THE STOCKHOLDERS:
The annual meeting of stockholders of Science Dynamics Corporation originally
scheduled for June 12, 1996, is rescheduled for November 7, 1996, at
10:30 a.m., prevailing time, at the General Offices of the Company at 1919
Springdale Road, Cherry Hill, New Jersey 08003 for the following purposes:
(1) To elect directors to serve for the ensuing year;
(2) To ratify the selection by the Board of Directors of Nemiroff,
Cosmas and Company as independent public auditors;
(3) To approve an increase in the authorized common stock; and
(4) To transact such other business and vote on such other matters
as may properly come before the meeting or any adjournment(s)
thereof.
A detailed statement of the background, experience or qualifications of all
nominees for Directors is set forth on pp. 3-4 of the present proxy statement
and on pp. 12-13 of the Form 10-KSB submitted contemporaneously in the form
of an annual report to shareholders.
The Board of Directors has fixed the close of business on September 18, 1996,
as the record date for determination of stockholders entitled to notice of and
to vote at the meeting. A list of stockholders and their stockholdings as of
September 18, 1996, will be available for inspection by all shareholders at
the time and place of this meeting.
All matters set forth herein and on the proxy card as known or anticipated as
coming before the shareholders for a vote at the November 7, 1996, meeting,
including the election of directors, approval of increase in authorized
common stock, an authorization for a class of preferred stock, and
ratification of the selection of the public auditors of the Company, will be
determined by a simple majority vote of all shares voting, either in person
or by proxy. Any proxy that does not contain an express vote for or against
any nominee or proposal or an abstention from voting on any specific proposal
will be voted by the proxy holder(s) in favor of such nominee(s) or proposal.
Any shareholder may expressly vote against, in favor of, or to abstain from
casting either form of vote for any nominee(s) or proposal. In the latter
event, such ballot will not be counted in the determination of such question
but will be counted for purposes of establishing the presence of a quorum at
the meeting.
It is important that your shares be represented and voted. In order to
ensure the representation of a quorum at the meeting, all Stockholders are
urged to fill in, sign and date the enclosed proxy and promptly mail the same
in the accompanying envelope.
By Order of the Board of Directors:
/s/ Joy C. Hartman
-------------------------
Joy C. Hartman, Secretary
Cherry Hill, New Jersey
October 4, 1996
<PAGE>
SCIENCE DYNAMICS CORPORATION
CHERRY HILL, NEW JERSEY
_______________________________
PROXY STATEMENT FOR THE
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON NOVEMBER 7, 1996
_______________________________
This statement is furnished in connection with the solicitation by the
Board of Directors of Science Dynamics Corporation (herein called the
"Company") of proxies for use at the annual meeting of stockholders to
be held on November 7, 1996, and at any adjournment thereof. Any proxy
given pursuant to this solicitation may be revoked at any time prior to
the voting thereof either by appearing in person at the meeting or by
notice in writing received by the Secretary of the Company or by execution
and presentation of a proxy bearing a later date.
The Company had outstanding on September 18, 1996, the record date for
the meeting, 8,336,728 shares of common stock. Each stockholder of record on
the record date is entitled to one vote for each share held without right of
cumulation.
The following tables and text set forth information regarding stock ownership
as of December 31, 1995, and September 18, 1996, of the principal
shareholders, of each director and/or officer, and of all officers and
directors and all persons owning five percent or more of the Company's
common shares (par value $.01), its sole present class of security.
<TABLE>
PRINCIPAL STOCKHOLDERS
----------------------
<CAPTION>
Percent of Percent of
Name and Address No. of Shares Outstanding Shares No. of Shares Outstanding Shares
of Beneficial Owner as of 12/31/95<F1> as of 12/31/95<F1> as of 9/18/96<F11> as of 9/18/96<F11>
- ------------------- --------------- ------------------ --------------- ------------------
<S> <C> <C> <C> <C>
Lyndon A. Keele 775,034<F2> 9.78% 775,034<F2> 9.30%
701 Garwood Road
Moorestown, NJ 08057
Reynolds E. Moulton, Jr. 761,000 9.61% 692,000 8.30%
54 Washington Street
Marblehead, MA 01945
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
--------------------------------
The following information table sets forth information as to the shares and percentages of common stock
of the Company beneficially owned by the Directors of the Company, and by all Officers and Directors of
the Company as a group, as of December 31, 1995, and as of September 18, 1996.
<CAPTION>
Percent of Percent of
No. of Shares Outstanding Shares No. of Shares Outstanding Shares
Name as of 12/31/95<F1> as of 12/31/95<F1> as of 9/18/96<F11> as of 9/18/96<F11>
<S> <C> <C> <C> <C>
Lyndon A. Keele 775,034<F2> 9.78% 775,034<F2> 9.30%
(President, Chairman
of the Board, Director,
and Treasurer)
Russell R. Angely 11,000<F3> .14% 11,000<F3> .13%
(Vice President)
Joy C. Hartman 1,000<F2> .01% 1,000<F2> .010%
(Vice President,
Secretary, Director)
Kenneth P. Ray 6,000<F3> .08% 6,000<F3> .072%
(Director)
Sheldon C. Hofferman 365,533<F4> 4.61%
(Director until Not Not
May 31, 1996) ________ _______ Applicable Applicable
All Directors and
Officers as a Group<F5> 1,158,567 14.63% 793,034 9.51%
______________________
<FN>
<F1>
Based upon a total number of 7,922,978 shares outstanding as of December 31, 1995.
</FN>
<FN>
<F11>
Based upon a total number of 8,336,728 shares outstanding as of September 18, 1996.
</FN>
<FN>
<F2>
Includes 12,000 shares owned by Mr. Keele's daughter and 300 shares owned by Ms. Hartman's children.
The daughter of Mr. Keele has sole voting and investment power with respect to her shares and Mr. Keele
has sole voting and investment power with respect to all other shares in this total.
Ms. Hartman holds incentive options to acquire 35,000 shares of the Company's common stock.
</FN>
<FN>
<F3>
Has sole voting power and sole investment power with respect to the shares owned by such person.
In addition to the 6,000 shares owned by K. Ray, an outside Company Director, Mr. Ray holds incentive
options to acquire 20,000 shares. Mr. Angely holds incentive options to acquire 20,000 shares of the
Company's common stock.
</FN>
<FN>
<F4>
The total includes 266,133 shares owned by Golden Phoenix,L.P., of which Mr. Hofferman is the general
partner. Mr. Hofferman resigned from the Board of Directors on June 1, 1996, but continues to act as
an advisor to the Board.
</FN>
<FN>
<F5>
The above list excludes J. Cox, an outside Company Director, who holds incentive options that would
permit him to later acquire 20,000 shares. Mr. Cox has requested that he not be renominated for election
to the Board due to other business pursuits.
</FN>
______________________
</TABLE>
Section 16(a) of the Securities and Exchange Act of 1934 requires that the
Company's executive officers, directors and persons beneficially owning in
excess of ten percent of the Company's outstanding shares file initial
reports of ownership and reports of any ensuing changes in ownership with
both the Securities and Exchange Commission as well as with N.A.S.D. All
such persons are required in addition to furnish the Company with copies of
all such forms.
<PAGE>
Based upon a review of the forms so furnished to the Company, the Company
does not believe that any officer, director, or principal shareholder is or
has been delinquent in the filing of any required report forms (Forms 3, 4,
or 5) as required by Section 16 of the Securities Exchange Act, Item 4 or 5
of Regulation S-B (228.405). In order to ensure compliance with such
disclosure requirements, all officers, directors, and principal shareholders
are supplied with a detailed and comprehensive memorandum setting forth all
disclosure and reporting rules. In addition, before any affected party can
acquire or dispose of any interest of any nature in any Company securities or
any derivative rights in such securities such as options or warrants, they
are required to consult with both senior management and Company counsel.
In addition, management periodically reviews public reports of securities
transactions and Company's Transfer Agent also advises the Company of any
pending transfers of securities.
There were four directors' meetings in 1995.
All directors attended each meeting with the exception that Mr. Cox was
absent from one meeting. There were three meetings during 1996.
ELECTION OF DIRECTORS
---------------------
The Board of Directors has authorized, as in prior years, the provision for
four director positions. Four directors are to be elected who will serve
until the next annual meeting of stockholders or until their respective
successors shall be elected and qualified. Unless a stockholder expressly
indicates otherwise on his/her or their proxy, all proxies will be voted for
the election as directors those persons named in the following table and upon
the enclosed proxy ballot form. If any shareholder expressly abstains from
voting, such shares will not be counted except for determination of the
presence of a quorum. If any such nominee shall be unable or shall fail to
act as such by virtue of any unexpected occurrence, proxies will be voted
for such other person(s) as shall be determined by the proxy holder(s) in
his/her (their) discretion. The Board of Directors may also, in its own
discretion, alternatively reduce the number of directors to be elected.
No nominee for director has any direct personal interest in any matter to
be voted upon at the 1996 meeting. There are no rights to cumulatively vote
any shares. The election of directors will be determined by a simple
majority vote.
Principal Occupation
Nominees Age and Directorships
- -------- --- -----------------
Lyndon A. Keele 67 Chairman of the Board of Directors and President
since June 1973, Treasurer since December 1980,
and Director since April 1973.
Kenneth P. Ray 63 Incumbent Director.
Joy C. Hartman 47 Executive Vice President Administration and
incumbent Director.
Alan C. Bashforth 46 Candidate for Director
<PAGE>
EXPERIENCE AND BACKGROUND OF DIRECTORS AND OFFICERS
---------------------------------------------------
The general background, business experience, and other directorships of
nominees for the Board of Directors and of the Company's Executive Officers
is as follows:
LYNDON A. KEELE is the founder of the Company and has been active as Chairman
of its Board of Directors and President from June of 1973 and as its Treasurer
since December of 1980. From April of 1973 to August of 1977 he managed his
own investments and served as a consultant to a number of companies involved
in the electronics industry. Prior to 1973, Mr. Keele served for five years
as a Principal and Executive Vice President of TeleSciences, Incorporated, a
company engaged in design and manufacture of telephone support equipment.
He theretofore served as a Program Manager for multimillion dollar programs
involving data and circuit switching systems at ITT Federal Laboratories.
From 1958 to 1962, he was employed by GTE's Sylvania Electronics Systems
Division in various management positions, including Program Manager of data
processing and cryptographic communications Projects and Programs. He was
awarded a B.B.A. by the University of Texas in 1951.
KENNETH P. RAY is President of DelRay, Inc., an active telecommunications
consulting firm. From 1964 to 1987 he was associated with ITT in various
responsible positions and in 1976 became Vice President of ITT
Telecommunications, with responsibility for engineering, marketing and sales
departments. In 1981 he became Vice President and Director of Operations for
the Transmission Division of ITT Space Communications. In January, 1987,
ITT's telecommunications group was acquired by Alcatel and Mr. Ray became
Vice President of Marketing and Development for Alcatel Network Systems.
From 1988 to 1991, he was Vice President for Technology and Business
Development for Alcatel North America, a telecommunications company. Mr. Ray
received a BSEE from Polytechnic Institute of New York in 1954 and a Masters
in Economics from North Carolina State University in 1970.
SHELDON C. HOFFERMAN, has been an Attorney and Private Investor since 1971.
Mr. Hofferman graduated from the University of Pennsylvania in 1966 and
Temple University Law School in 1971. He was in private law practice in
Washington, D.C., specializing in communications law, from 1971 to 1974.
He served as Senior Trial Attorney for the Federal Trade Commission from
1974 to 1983, and re-entered private law practice thereafter. Mr. Hofferman
has also served as General Partner of Golden Phoenix Limited Partnership, an
investment concern, since 1983. Mr. Hofferman resigned from the Board
effective June 1, 1996, but continues as advisor to the Board.
JOY C. HARTMAN, Executive Vice President, was employed by the Company in
January 1982, and is responsible for General Corporate Administration
including the functions inherent in comptrollership, personnel, employee
benefits, and insurance activities. Her prior experiences included MSA, a
marketing research company, TeleSciences, Incorporated, and Peat
Marwick-Mitchell. Ms. Hartman is a graduate of the Wharton School of
Business of the University of Pennsylvania.
ALAN C. BASHFORTH, is the President of Innovative Communications Technology,
LTD., a data communications company, located in Jersey, Channel Islands, and
has for the past three years been developing new data products. Prior
experience included ownership of the CSL Group of companies from its
inception in 1975. CSL is a Communications and Computer engineering group
and employed over 100 people in 1992 when Mr. Bashforth sold the company.
From 1970 to 1975, Mr. Bashforth was employed by Automaten CI, LTD., an
office equipment and telecommunications company in various engineering and
sales positions leading to the position of General Manager. Mr. Bashforth
was educated in electronic engineering at Mid Herts Polytechnic College in
England and holds a Higher National Diploma in Electronic Engineering.
COMMITTEES OF THE BOARD
-----------------------
The Company's Board of Directors has no salary or nominating committees.
Its sole committees are a Stock Option Committee and an Audit Committee.
The Stock Option Committee oversees the Company's Incentive Stock Option Plan.
During the past year, Lyndon A. Keele and Joy C. Hartman served on this
committee.
<PAGE>
In addition, the Company organized and instituted an Audit Committee in 1987
whose members during 1995 included John E. Cox and Kenneth P. Ray. There was
one formal meeting of the Audit Committee during 1995 and one meeting of the
Stock Option Committee. Peter Cosmas of Nemiroff, Cosmas and Company (the
Corporation's public auditors) normally participates in the Audit Committee
meeting but does not serve or act as a member of this Committee. There have
been no meetings of either Committee during the intervening period of 1996.
THE ACQUISITION OF
INNOVATIVE COMMUNICATIONS TECHNOLOGY, LTD.
------------------------------------------
Management believes the proposed acquisition of Innovative Communications
Technology, LTD. (ICT) will broaden both the Company's product line and
customer base. Science Dynamics will, assuming execution of the agreement as
presently constituted and closing thereupon, acquire all the assets and
intellectual property of ICT which includes, among other properties, a Frame
Relay System, a File Transfer System, and a Celerity System. The Frame
Relay System enables any digital data stream, (including audio and video) to
be transmitted in packetized form over dedicated telephone company data
circuits, thus allowing intracompany audio and video conferencing between
computer users at any time. The File Transfer System is designed for use
via satellite networks so as to enable computers to transfer data on a
confidential broadcast basis to any one or multiple addresses simultaneously.
This system is compatible with Windows 3.1 and Windows 95. The Celerity
System design concepts are used to increase access speed to private data
services and the internet.
As consideration for the acquisition of ICT's assets, the Company will issue
1,500,000 shares of SDC common stock. In addition, as a condition of the
acquisition, Mr. Allen Bashforth, ICT's Chairman and CEO, will purchase SDC
common shares, the number of which will be based on the market price of such
shares at the time of purchase. Further, based upon SDC's future performance
in both sales and profits, Mr. Bashforth will earn warrants to purchase up to
another 2,000,000 shares, also at prices to be determined on the basis of the
market price of such shares at the time the warrants are exercised. Mr.
Bashforth will become President and CEO of SDC upon consummation of the
above-described acquisition.
This acquisition can only be accomplished by a favorable vote on question
three, which amends the Company's Certificate of Incorporation to authorize
additional common stock. Should approval of the additional common stock be
withheld by the stockholders, the acquisition of Innovative Communications
Technology, LTD. could not be consummated. The consequences would be to
deprive the Company of its attempt to broaden the customer base with new
product offerings and negate the included financing. The deprived financing
would have deleterious effects on the Company's ability to move forward.
APPROVAL TO AMEND THE COMPANY'S CERTIFICATE OF INCORPORATION
TO AUTHORIZE AN INCREASE IN COMMON SHARES
AND A NEW CLASS OF PREFERRED STOCK
------------------------------------------------------------
The Board of Directors requests that the stockholders approve an amendment
to the Company's Certificate of Incorporation to authorize a common stock
increase from the present 10,000,000 shares (par value $.01) to 25,000,000
shares (par value $.01). In addition, the Board requests the stockholders
to approve the establishment of a new class of preferred stock in the amount
of 2,000,000 shares with par value of $.01.
<PAGE>
In order to create more flexibility for financing opportunities, the Company
desires to have greater flexibility in offering equity securities to the
investment community other than common stock. Therefore, the Company is
requesting the shareholders to approve an Amendment to the Company's
Certificate of Incorporation to authorize a new class of 2,000,000 shares
(par value $.01) Preferred Stock. The Board of Directors will have the
authority to issue the Preferred Stock in one or more classes or series
and to fix the rights, and restrictions thereof, including dividend rights,
dividend rates, conversion rights, voting rights, terms of redemption,
redemption prices, liquidation preferences and the number of shares
constituting any classes or series of the designation of such classes or
series, without further vote or action by the shareholders. The Company
intends that its Board of Directors will exercise its authority under the
proposed Amendment, if adopted, to authorize a newly created class of
Preferred Stock to effectuate any future financing. While the Company has
no present plans to issue such preferred stock, should future events present
advantageous situations, the Company will be in a position to accomplish that
action.
EXECUTIVE OFFICERS
------------------
All Company Officers are elected yearly by the Board of Directors at its
annual organizational meeting immediately following each annual stockholder's
meeting. The officers during 1995 and as of the date of this Proxy Statement,
include Lyndon A. Keele, age 67, President, Chairman of the Board and
Treasurer; Joy C. Hartman, age 47, Executive Vice President, and Russell R.
Angely, age 57, Vice President of Sales and Marketing.
REMUNERATION OF OFFICERS AND
DIRECTORS AND CERTAIN TRANSACTIONS
----------------------------------
The following table sets forth all remuneration for services in all
capacities to the Company during the year ended December 31, 1995, for the
Company's Chief Executive Officer and for each executive officer and/or
director who received more than $100,000.00 from the Company during such
year. No director receives any compensation or payment of any nature for
his services as director other than for an honorarium of Two Hundred Fifty
Dollars ($250.00) paid to outside directors for each meeting attended.
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------- ----------------------
Name and Other Awards LTIP All
Principal Position Year Salary($) Bonus($) Annual Restricted Payouts($) Other
Compensa- Stock Options/ Compensa-
tion($) Award(s)($) SARs(#) tion($)
- ------------------ ---- ------------------------------ -------------------------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Lyndon A. Keele, CEO 1995 132,538 - 0 - - 0 - - 0 - - 0 - - 0 - - 0 -
Joy C. Hartman, EVP 1995 105,179(1) - 0 - - 0 - - 0 - - 0 - - 0 - - 0 -
Russell R. Angely, VP 1995 85,938 - 0 - 17,808(1) - 0 - 10,000 - 0 - - 0 -
*Ms. Hartman's base salary of $101,000 was supplemented by a one time payment
of $4,179 for accrued vacation. Mr. Angely's other compensation resulted
from sales commissions.
</TABLE>
<TABLE>
The following table sets forth the stock options granted by the Company in
1995 reflected in the Summary Compensation table above.
<CAPTION>
Name Options/SARs Granted % of Total Options/SARs Granted Exercise or Base Price
to Employees in Fiscal Year Per Share Expiration Date
<S> <C> <C> <C> <C>
Russ Angely 10,000 100% $ 1.00 05/02/2005
</TABLE>
The table below sets forth information with respect to the number and value
of unexercised options held by the named Executive Officers of the Company
on December 31, 1995. No stock options were exercised by such persons in
1995 and there are no outstanding stock appreciation rights.
<PAGE>
<TABLE>
<CAPTION>
YEAR-END OPTION VALUES
----------------------
Value of Unexercised
Name Shares Acquired on Number of Unexercised Options In-The-Money Options
Exercise Value Realized at December 31, 1995 at December 31, 1995
Exercisable Unexercisable Exercisable Unexercisable
- ----------- ------------------ -------------- ----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Russ Angely 0 -- None 20,000 None None
Joy C. Hartman 0 -- 35,000 0 None None
</TABLE>
There were no other such compensated executive officers or directors during
the calendar year 1995, and there are no others as of the date of this
Statement.
Should there be a change in control or ownership of the Company by
acquisition or merger, the Board of Directors on January 25, 1996, adopted a
resolution whereby the present officers of the Corporation are protected
from termination without cause. The compensation amount is limited to
compensation for three years of salary. Such compensation can be either
a lump sum payment or payment over a three year period.
The Company presently has no standing plans or arrangements for contingent
forms of compensation such as bonuses, commissions, executive stock options,
stock appreciation rights, profit sharing, pension, retirement plans or other
like benefit programs, except for the past and present Incentive Stock Option
Plan as hereafter described. No officer, director, or other employee
consequently received or was entitled to any form of non-cash compensation
under any form of plan described or included within Regulation S-B, Section
402(b)(1), Reg. 228.402, Section (b)(1).
The Shareholders approved an initial Incentive Stock Option Plan on April 22,
1982, including 162,000 shares, which was amended by the shareholders on
April 24, 1984, to include an additional 200,000 shares. This Plan expired
on April 27, 1992. The shareholders approved a successor Incentive Stock
Option Plan encompassing 290,950 shares of the authorized previously unissued
$0.01 per share par value stock of the Company. This included 90,950 shares
allocated to the initial Plan that had never been awarded and 200,000 newly
allocated shares. During the year 1992, 50,000 shares were made subject to
awards by the Committee to officers and directors, including 10,000 shares
each to all directors except for Mr. Keele who has never received any option
awards of any nature. Options can be and are awarded under the Plan only to
key engineering, design, manufacturing, sales, or management personnel and
all are granted at the then fair market value of the Company's stock. In the
event any option would be awarded to a person holding directly or
beneficially in excess of ten percent of the Company's stock, such award must
be made at 110% of the then fair market value of the Company's stock. In all
other respects, the Plan conforms to all provisions of Section 422 of the
Internal Revenue Service Code and has been granted authority from time to
time to enact amendments to bring the Plan into conformity with any
amendments to the Code. The shares allocated to the successor Plan were
subject to an S-8 Registration Statement filed with the Securities and
Exchange Commission on or about June 5, 1992.
There have been no changes of any nature in any of the substantive provisions
or procedures of this Plan since adoption. Awards under this Plan have been
made by a committee of the Board (which, during 1995, consisted of Lyndon A.
Keele and Joy C. Hartman) and are based solely upon individual performance
and are within the discretion and judgment of the Committee. While Ms.
Hartman holds options on certain shares of the Company under this Plan, all
of the same predate her membership on this Committee. Neither she nor Mr.
Keele nor any other prior member of this Committee have ever nor will any
successor member receive any option grants while serving on this Committee
other than for the 10,000 shares awarded to all directors (except Mr. Keele)
on both May 9, 1990, and on July 8, 1992.
The Plan has involved no assets or payments other than the award of options
which are required to be made at full market price on the date of the award.
All options have always been granted at the then current market price of the
Company's shares and at values ranging from $8.00 per share to $1.25 per
share as of the date of the statement. No options have ever been awarded at
less than market value. In addition, no option shares have ever been awarded
to the principal shareholders of the Company. With respect to principal
employees and directors, as of the date of the statement, Ms. Hartman has
options for 35,000 shares; Mr. Angely, options for 20,000 shares; and Mr.
Ray, options for 20,000 shares.
<PAGE>
The Company maintains no other compensation awards which are granted in
conjunction or in tandem with such options and the Company further maintains
no other pension, thrift, profit sharing or other options or similar
extraordinary compensation plans of any nature.
There are no standing plans or present proposals for specific payment of any
bonuses, commissions (other than regular sales commissions), awards of other
option rights or other remuneration within the terms of Section 402(b)(1),
Reg. 228.402(b)(1), other than salaries as the latter are now and will
hereafter from time to time be fixed by the Board of Directors. Bonuses,
commissions, options awards and other similar special payments as well as
salaries will continue to be fixed from time to time in the discretion of
the Option Committee and the Board of Directors, as circumstances and
performance shall indicate.
During 1995 there were two transactions with an officer and a director.
Mr. Sheldon Hofferman, a Company Director, purchased additional restricted
stock in the amount of $25,000. Mr. Lyndon A. Keele, President and a
Director, converted the Company's $188,600 indebtedness to him into common
stock. at the market price on the day of conversion. There have been no
other transactions resulting in any payment or grant or conveyance of other
properties or rights other than direct salary payments or sales commissions
made solely in exchange for actual services rendered in the normal course of
business.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
------------------------------------------------
Nemiroff, Cosmas and Company (formerly Nemiroff, Cosmas, Titus and Cochamiro)
have served as public auditors for the Company during the entire calendar
year 1995, having been re-engaged as Company auditors on December 21, 1990,
succeeding Coopers & Lybrand (which had been the Company auditors from 1985
until December 17, 1990). Nemiroff, Cosmas and Company previously served as
public auditors for the Company from 1981 through 1985. The Board of Directors
has voted unanimously to re-engage Nemiroff, Cosmas and Company as public
auditors for the Company for the current year and will request the
shareholders to ratify such selection at the annual meeting of shareholders
to be held on November 7, 1996. This proposal will be determined by a
simple majority vote.
Representatives of Nemiroff, Cosmas and Company will be present at the
meeting of stockholders to assist shareholders and to answer any questions
that may arise as to the current financial statements and reports and to
make any statement the auditor may desire to present.
Nemiroff, Cosmas and Company has not rendered non-auditing services nor has
it made any claim for payment of compensation for any non-auditing services.
It has no interest of any nature in the Company other than for its present
professional engagement. No member or affiliate of the firm has ever had
any business dealings or family relationships with any officers, directors,
or principal shareholders of the Company.
ANNUAL REPORT
-------------
The Company has mailed its 10-KSB Report for the year ended December 31, 1995,
and the Second Quarter 10Q for 1996 under identical cover with this Proxy
Statement to all stockholders. Reference may be made to that report for
financial and other information about the Company. ADDITIONAL COPIES OF THE
FORM 10-KSB OR ANY FORM 8-K PREVIOUSLY FILED AND/OR ALL EXHIBITS NOTED ON THE
10-KSB OR OF THE SUCCESSOR INCENTIVE STOCK OPTION PLAN WILL BE MADE AVAILABLE
TO STOCKHOLDERS AT NO COST UPON REQUEST TO THE COMPANY'S SECRETARY, 1919
SPRINGDALE ROAD, CHERRY HILL, NEW JERSEY 08003, WHICH SHOULD INCLUDE THE
PRECISE ADDRESS WHERE SUCH MATERIALS ARE TO BE SHIPPED.
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STOCKHOLDERS PROPOSALS
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No stockholder proposals have been received for submission at the November 7,
1996, meeting. Any stockholder proposal appropriate for shareholder
consideration and any action that a shareholder may desire to be considered
for inclusion in proxy material for the Company's annual meeting of
stockholders in 1997 must be received at the principal executive offices of
the Company no later than 120 days prior to the date in 1997 when the proxy
materials will have been distributed for the 1997 annual meeting of
shareholders which, at the time of preparation of this statement, is
estimated to be on or about June 1, 1997.
Any shareholder desiring to submit a proposal at any time is entitled to
have access to the relevant shareholders list. Requests for the same should
be submitted in writing to the Company's Secretary at 1919 Springdale Road,
Cherry Hill, New Jersey 08003.
GENERAL
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Proxies are being solicited by mail. Brokerage houses, custodians, nominees
and fiduciaries will be requested to forward the soliciting material to the
beneficial owners of stock held of record by such persons, and the Company
will reimburse them for their expenses in doing so.
THIS SOLICITATION OF PROXIES IS MADE FOR AND BY MANAGEMENT OF THIS COMPANY
AND THE ENTIRE COST OF THIS SOLICITATION WILL BE BORNE BY THE COMPANY.
Management does not intend to present and does not have any reason to
believe that others will present any proposal or item of business at the
annual meeting other than those set forth in the notice of the meeting and
within the present Proxy Statement. If any other matters are properly
presented for a vote, the proxies will be voted for such matters in
accordance with the best judgment of the person designated as proxy on the
proxy card. Any shareholder may attend the meeting in person, regardless of
whether a proxy has been previously executed. Attendance and voting in
person as well as subsequent execution of a latter written proxy will
automatically revoke any prior proxy not coupled with an interest.
By Order of the Board of Directors:
/s/ Joy C. Hartman
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Joy C. Hartman, Secretary
Cherry Hill, New Jersey
October 4, 1996
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SCIENCE DYNAMICS CORPORATION
Proxy Solicited on Behalf of The Board of Directors For
The Annual Meeting of Stockholders of November 7, 1996
The undersigned hereby appoints and constitutes Lyndon A. Keele and Joy C.
Hartman, or each or either of them as his/her true and lawful agent and
proxy with full power of substitution to represent the undersigned at the
Annual Meeting of Stockholders of Science Dynamics Corporation to be held
at the Corporate Offices at 1919 Springdale Road, Cherry Hill, New Jersey
on November 7, 1996 at 10:30 A.M. and at any adjournment of such meeting,
and to vote, as directed below, on matters coming before such meeting.
This proxy when executed will be voted as directed below. If no direction
is made, this proxy will be voted for the election of Directors the nominees
set forth below; for ratification of the Directors' engagement of Nemiroff,
Cosmas and Company to act as independent public auditors; increase in
authorized common stock and provide for preferred stock; and for all routine
matters normally incident to a meeting and, at the discretion of the
holder(s), for any other matter that could not reasonably have been
anticipated at time of solicitation. This proxy will be voted in accordance
with all specifications or instructions contained or inserted hereupon.
1. ELECTION OF DIRECTORS
Nominees for Directors:
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Lyndon A. Keele Kenneth P. Ray Joy C. Hartman Alan C. Bashforth
Mark only one:
[ ] Vote for all such nominees listed above and recommended by the
Board of Directors.
[ ] Vote for all such nominees, except those whose names are lined out.
[ ] Vote withheld from all nominees.
[ ] Abstention.
To approve an amendment to the Company's Certificate of Incorporation to
authorize a common stock increase from the present 10,000,000 par value $.01
shares to 25,000,000 par value $.01 shares. In addition, to establish a
new class of preferred stock in the amount of 2,000,000 shares. While the
Company has no present plans to issue preferred stock, should future events
present advantageous situations, the Company will be in a position to
accomplish that action.
PROPOSAL TO AUTHORIZE 2,000,000 SHARES OF A NEW CLASS OF PREFERRED STOCK
Mark only one:
[ ] Vote to authorize the creation of preferred stock
[ ] Vote against the creation of preferred stock
[ ] Abstain
PROPOSAL TO AUTHORIZE AN INCREASE IN COMMON STOCK FROM 10,000,000 SHARES TO
25,000,000 SHARES
Mark only one:
[ ] Vote to authorize the increase in Common Stock
[ ] Vote against the increase in Common Stock
[ ] Abstain
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC AUDITORS
FOR THE FISCAL YEAR ENDING DECEMBER 31, 1996
Mark only one:
[ ] Vote to ratify appointment of Nemiroff, Cosmas and Company as
recommended by Board of Directors
[ ] Vote against ratification of such auditors
[ ] Abstention
Please sign and date this proxy and return it promptly whether or not
you plan to attend the meeting. Sign exactly as name(s) appear(s) on
your Stock Certificate(s). Persons signing as attorneys, executors,
administrators, trustees, guardians or in like capacity should set forth
their full title. If signed on behalf of a corporation, the full corporation
name and the signer's corporate capacity should be signed by an authorized
officer. All joint tenants, tenants in common and tenants by the entirety
should sign. If you attend the meeting and vote by ballot, such vote will
automatically supersede this proxy. The Board of Directors is not aware
of any matters to be presented at the 1996 annual meeting other than for
the items defined above. In the event any unanticipated matter may be
presented at the meeting, the proxy holders or their substitutes are
authorized by your signature to vote upon any and all such other business
as may properly come before the meeting and which could not reasonably have
been anticipated to have been presented at the time of preparation of the
present proxy card and the enclosed proxy materials.
The undersigned hereby revokes any and all proxies heretofore given to vote
at such meeting or any adjournment thereof.
Dated: ,1996 _______________________________
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