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
[_] 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 Section 240. 14a-11(c) or Rule 14a-12
THERMODYNETICS, INC.
(Name of Registrant as Specified In Its Charter)
------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] 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 (set forth the amount on which the filing fee is
calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials:
[_] 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.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
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THERMODYNETICS, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
--------------------------------------------
December 4, 1998
The Annual Meeting of Stockholders of Thermodynetics, Inc. (the "Company")
for fiscal year ended March 31, 1998 will be held at the Company's principal
offices at 651 Day Hill Road, Windsor, Connecticut 06095 on Friday, December 4,
1998 at 9:30 A.M. (EST) for the purpose of considering and acting upon the
following matters:
1. Election of three (3) directors (Proposal One).
2. Such other business as may properly come before the meeting or
any adjournment thereof.
Pursuant to the provisions of the By-Laws, the Board of Directors has fixed
the close of business on October 7, 1998 as the record date for determining the
stockholders of the Company entitled to notice of, and to vote at the meeting or
any adjournment thereof.
Stockholders who do not expect to be present in person at the meeting are
urged to date and sign the enclosed proxy and promptly mail it in the
accompanying postage-paid envelope. A prompt response will avoid the cost to the
Company of additional mailings of proxy solicitations.
By Order of the Board of Directors
Thermodynetics, Inc.
Robert A. Lerman
President
October 15, 1998
Windsor, Connecticut 06095
PLEASE COMPLETE AND PROMPTLY RETURN YOUR PROXY IN THE
ENCLOSED ENVELOPE. THIS WILL NOT PREVENT YOU FROM VOTING IN
PERSON AT THE MEETING BUT WILL, HOWEVER, HELP TO ASSURE A
QUORUM AND AVOID ADDED PROXY SOLICITATION COSTS.
<PAGE>
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THERMODYNETICS, INC.
PROXY STATEMENT
-------------------------
This Proxy Statement is first being mailed to Stockholders on October 15,
1998 in connection with the solicitation of proxies by the Board of Directors to
be used at the Annual Meeting of Stockholders of Thermodynetics, Inc., a
Delaware corporation (the "Company"), to be held on Friday, December 4, 1998 at
the Company's principal offices at 651 Day Hill Road, Windsor, Connecticut 06095
at 9:30 A.M. (EST).
Accompanying this Proxy Statement is a Notice of Annual Meeting of
Stockholders, a form of Proxy for such meeting and the Company's Annual Report
for the fiscal year ended March 31, 1998 including financial statements with
respect to such year. All proxies which are properly filled in, signed and
returned to the Company in time will be voted in accordance with the
instructions thereon. Such proxies may be revoked by any stockholder prior to
the exercise thereof and stockholders who are present at the meeting may
withdraw their proxies and vote in person if they so desire. The Board of
Directors has fixed the close of business on October 7, 1998 as the record date
for the determination of stockholders who are entitled to notice of, and to vote
at the meeting or any adjournment thereof.
The expense of preparing, assembling, printing and mailing the form of
proxy and the material used in solicitation of proxies will be borne by the
Company. In addition to the solicitation of proxies by use of the mails, the
Company may utilize the services of some of its officers and regular employees
(who will receive no additional compensation therefor) to solicit proxies
personally, and by telephone and other communication mediums. The Company has
requested banks, brokers and other custodians, nominees and fiduciaries to
forward copies of the proxy material to their principals and to request
authority for the execution of proxies and may reimburse such persons for their
services in doing so.
Vote required, Principal Stockholders and Stockholdings of Management - The
presence, in person or by proxy, of the holders of a majority of the outstanding
shares of Common Stock of the Company is necessary to constitute a quorum at the
meeting. Election of directors (Proposal One) requires the affirmative vote of a
majority of the votes cast by the holders of Common Stock present in person or
by proxy at the meeting.
As of the record date, the Company had 12,408,110 shares of its Common
Stock issued and outstanding, the holders of which are entitled to one vote per
share.
The following table sets forth, as of the record date, the number of shares
of the Company's Common Stock owned beneficially to the knowledge of the
Company, by each beneficial owner of more than 5% of such Common Stock, by each
director, and by all officers and directors of the Company as a group. The
shares underlying the incentive stock options held by two officer/directors and
one officer which are presently exercisable are deemed as outstanding.
<PAGE>
Thermodynetics, Inc. Proxy Statement
Page 2
Name and Address(1) Amount and Nature Percent of
of Beneficial Owner of Beneficial Ownership Class Owned
- ------------------- ----------------------- -----------
Directors and Officers
John F. Ferraro 3,725,100 shs(2)(6) 25.9%
Robert A. Lerman 3,993,211 shs(2)(7) 27.7%
Anthony C. Mirabella 210,087 shs(3) 1.7%
Robert I. Lieberman 252,739 shs(4) 2.0%
All officers and 8,181,137 shs(5) 57.3%
directors as a group
(four persons)
- ----------
(1) The address of all officers and directors is c/o the Company, 651 Day Hill
Road, Windsor, Connecticut 06095.
(2) Includes options exercisable to acquire 2,000,000 shares; includes 37,120
shares held for Mr. Ferraro and 49,251 shares held for Mr. Lerman in trust
under the Company's 401(k) Plan, respectively; excludes the aggregate
634,803 shares held in trust by the trustees of the 401(k) Plan for all of
the participating employees. Includes one-half of 166,121 shares held by
Pioneer Partners Corp; Messrs. Ferraro and Lerman each have a 50% interest
in such shares. Mr. Ferraro's beneficial holdings include 33,360 shares
held by his spouse. Mr. Lerman's beneficial holdings include 244,525 shares
held by his spouse.
(3) Includes options exercisable to acquire 50,000 shares. Excludes the
aggregate 634,803 shares held in trust by the trustees of the 401(k) Plan
for all of the participating employees.
(4) Includes options exercisable to acquire 150,000 shares; includes 16,939
shares held in trust under the Company's 401(k) Plan.
(5) Includes options exercisable to acquire 4,200,000 shares; includes 103,310
shares held in trust under the Company's 401(k) Plan for each respective
officer's account; excludes the aggregate 634,803 shares held in trust by
the trustees of the 401(k) Plan for all of the participating employees.
Includes 244,525 shares held by the spouse of Mr. Lerman, and 33,360 shares
held by the spouse of Mr. Ferraro. Includes 166,121 shares held by a
corporation which is owned by Messrs. Lerman and Ferraro.
(6) Mr. Ferraro contributed certain of his shares of Company stock in
accordance with the guidelines to the John F. Ferraro Defined Benefit
Pension Plan and Trust which was established in 1984; the aggregate
holdings of outstanding shares of Company stock actually issued which are
now owned by that pension plan equals 1,050,000 shares; Mr. Ferraro, as
trustee of the Plan, has full voting authority over that pension plan's
shares; thus that pension plan's shares have been included Mr. Ferraro's
above aggregate beneficial ownership calculation.
(7) Mr. Lerman contributed certain of his shares of Company stock in accordance
with the guidelines to the Robert A. Lerman Money Purchase Plan and Trust,
established in 1988; the aggregate holdings of outstanding shares of
Company stock actually issued which are now owned by that pension plan
equals 971,880 shares; Mr. Lerman, as trustee of that pension plan, has
full voting authority over that pension plan's shares; thus that pension
plan's shares have been included in Mr. Lerman's above aggregate beneficial
ownership calculation.
Holders of an aggregate 12,408,110 shares of the Company's Common Stock are
entitled to notice of and to vote at the Annual Meeting of Stockholders. The
Company's officers and directors, who have the right to vote an aggregate
4,512,629 shares representing thirty-six and four-tenths of one percent (36.4%)
of all shares which are entitled to be voted, have stated their intentions to
vote their shares FOR Proposal One.
<PAGE>
Thermodynetics, Inc. Proxy Statement
Page 3
ACTIONS TO BE TAKEN AT THE MEETING
ELECTION OF DIRECTORS
(Proposal One)
All directors shall serve until his successor is elected and is qualified.
The shares represented by proxies will be voted in favor of the election as
directors of the persons named below who are nominees for election and authority
to vote for the election of directors shall be deemed granted unless
specifically withheld. The Board of Directors has no reason to believe that any
of the nominees for the office of director will not be available for election as
a director. However, should any of them become unwilling or unable to accept
nomination for election, it is intended that the individuals named in the
enclosed proxy may vote for the election of such other person as the Board of
Directors may recommend. The Company does not have a nominating, an audit or a
compensation committee. During the fiscal year ended March 31, 1998 the
Company's Board of Directors held a total of three (3) meetings.
Nominees for Election as Directors
Director
Name of Nominee Age Position with the Company Since
- --------------- --- ------------------------- -----
John F. Ferraro 64 Chairman of the Board, Chief Executive
Officer and Secretary 1979
Robert A. Lerman 63 President and Director 1979
Anthony C. Mirabella 57 Director 1985
Principal Occupations of Directors and Nominees During the Past Five Years
Robert A. Lerman holds the degrees of Bachelor of Mechanical Engineering,
CCNY (1957); Master of Science in Mathematics, Adelphi College (1961); and
Master of Science in Electrical Engineering, University of Connecticut (1964).
In 1979, Mr. Lerman was elected Treasurer and a Director and in 1980 President
of the predecessor to the Company. Since the Company's 1981 merger, Mr. Lerman
has been President and a Director of the Company, and from 1981 through 1992
served as Treasurer. In 1988, Mr. Lerman, along with Mr. Ferraro, founded
Pioneer Capital Corp., of which he is Secretary, Treasurer and a Director, a
privately held venture capital corporation. Mr. Lerman co-authored the text
book, Nonlinear Systems Dynamics, which was published in 1992 by Van Nostrand
Reinhold, New York, New York. In 1993, Mr. Lerman, along with Mr. Ferraro,
founded Pioneer Partners Corp., of which Mr. Lerman is President and Managing
Director; it is a privately held corporation serving as the general partner of
Bridge Investors I Limited Partnership, a partnership formed by Messrs. Lerman
and Ferraro for the purpose of providing venture capital financing to companies.
In 1997, Mr. Lerman became President and a Director of Pioneer Ventures Corp.
and a manager of Ventures Management Partners LLC, the general partner of
Pioneer Ventures Associates Limited Partnership, a partnership formed for the
purpose of providing venture capital financing to companies. In 1998, Mr. Lerman
became a director of Initio, Inc., and Tristar Corporation. Mr. Lerman has
financial interests in other companies, none of which are competitive with the
Company. See "Certain Transactions".
John F. Ferraro holds the degree of Bachelor of Science in Industrial
Engineering, New York University (1962). In 1979, Mr. Ferraro was elected
Secretary and a Director of the predecessor to the Company. Since the Company's
1981 merger, Mr. Ferraro has been Chairman of the Board and Chief Executive
Officer of the Company. In 1987, he was elected Secretary of the Company. In
1988, Mr. Ferraro, along with Mr. Lerman, founded Pioneer Capital Corp. of which
Mr. Ferraro is President and a Director. In 1993, Mr. Ferraro, along with Mr.
Lerman, founded Bridge Investors I Limited Partnership and its general partner
Pioneer Partners Corp., of which he is Treasurer, Secretary and a Director. In
1997, Mr. Ferraro became Secretary and a Director of Pioneer Ventures Corp. and
a manager of Ventures Management Partners LLC, the general partner of Pioneer
Ventures Associates Limited Partnership. Mr. Ferraro has financial interests in
other companies, none of which are competitive with the Company. See "Certain
Transactions".
Anthony C. Mirabella holds the degrees of Bachelor of Mechanical
Engineering, Stevens Institute of Technology (1962) and Master in Business
Administration, Western New England College (1969). He was elected a director of
the Company in 1985. Mr. Mirabella has been employed by Connecticut Natural Gas
Corporation since
<PAGE>
Thermodynetics, Inc. Proxy Statement
Page 4
1971, and is a Senior Vice President of said concern, responsible for The Energy
Network, Inc. and its district heating and cooling operations.
Executive Officers who are not Nominees for Director
Robert I. Lieberman is a certified public accountant. He holds the degree
of Bachelor of Science in Accounting and Business Administration from the State
University of New York (1975). Mr. Lieberman joined the Company as corporate
controller in 1986, in 1987 was elected Controller and Chief Financial Officer,
and in 1992 was elected Treasurer. In 1995 Mr. Lieberman was elected President
of Turbotec Products, Inc., the Company's principal operating subsidiary.
Certain Rights to Proceeds
Two of the Company's three directors currently own 656,334 shares in which
the Company has certain rights to the proceeds to be received upon the sale of
such shares which they received pursuant to 1984 stock subscription agreements,
as amended in 1988 and in 1994. Upon the sale of any of these shares, the
selling director shall pay directly to the Company at the time of receipt of the
net proceeds of such sale, which amount is equal to (i) such net sales proceeds
(up to a maximum of $0.40 per share for Messrs. Ferraro and Lerman) less (ii)
the purchase price paid by the subscriber for each share sold (approximately
$0.21). The directors retain full voting and dispositive control over these
shares. The Company has no other rights with respect to such shares. A total of
121,641 shares of a former director, Robert R. Googins, are subject to similar
restrictions as described above with the Company receiving the difference
between $0.21 and $1.00.
Section 16(a) Beneficial Ownership Reporting Compliance
At the fiscal year end and through the date hereof, the Company had not
received any reports from any director, officer or principal shareholder which
indicated on the report, or by calculation based on the transaction and receipt
dates, that any report was not filed on a timely basis.
Remuneration of Officers and Directors
The following table sets forth on an accrual basis for the three most
recent fiscal years, the remuneration of each of the Company's officers whose
remuneration exceeded $100,000 and for all officers of the Company as a group.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term Compensation
-----------------------------------------------------
Annual Compensation Awards Payouts
---------------------- -------------------------- --------------------
Other Restricted Company
Name and Fiscal Salary/ Compen- Stock Options/ LTIP 401(k)
Principal Position Year Bonus sation Awards SARS Payouts Contrib.
- ------------------ ---- ----- ------ ------ ---- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
John F. Ferraro (1) 1998 $149,029 $3,137 $0 0 shs $0 $398
Chairman of the Board 1997 $158,576(3) $2,413 $0 0 shs $0 $0
Chief Executive Officer 1996 $ 85,402(2) $2,350 $0 2,000,000 shs $0 $0
Secretary
Robert A. Lerman (1) 1998 $144,685 $3,450 $0 0 shs $0 $776
President 1997 $157,191(3) $3,450 $0 0 shs $0 $970
1996 $ 85,402(2) $3,985 $0 2,000,000 shs $0 $0
Robert I. Lieberman (4) 1998 $112,561 $15,330 $0 0 shs $0 $0
Treasurer 1997 $108,775 $750 $0 0 shs $0 $0
Chief Financial Officer 1996 $ 81,926 $750 $0 150,000 shs $0 $0
</TABLE>
<PAGE>
Thermodynetics, Inc. Proxy Statement
Page 5
(1) Messrs. Ferraro and Lerman entered into five year employment contracts with
the Company, effective April 1, 1996. Each employment contract provides for a
basic salary at an annual rate of $150,000 with an annual increase at April 1st
of each year based on increases in the Consumer Price Index. Each employment
contract requires the Company to provide medical insurance coverage for the
employee as well as $50,000 of group term insurance, and $1,500,000 of
additional life insurance. During the fiscal year ended March 31, 1998, the
Company paid $108,909 in net premiums on the two life insurance policies which
provide that upon death or termination of each such insured's employment, the
Company will be repaid from the proceeds of the policy the amount being the
lesser of the then existing cash surrender value of the policy or the aggregate
net premiums paid by the Company. At March 31, 1998, the amount receivable for
premiums paid on the policies was $923,790. In addition, each employment
contract contains a provision providing that in the event of disability, the
employee will receive disability payments of $100,000 per year for ten years
(with proportional reductions in the event of partial disability); and $5,000
per year for tax planning services. The contract may be terminated by the
employee on 120 days prior written notice. The contract may also be terminated
by the Company in which event the employee will be paid termination compensation
equal to each employee's then current salary for either the longer of the
remainder of the unrenewed term or three years; in the event there is a change
in control of the Company and the employee is terminated, the employee shall
receive twice the amount of termination compensation which would otherwise be
due.
(2) Messrs. Ferraro and Lerman waived all of their salaries and benefits for the
months of April through September, 1995 to assist the Company with its cash flow
needs.
(3) In 1997, Messrs. Ferraro and Lerman each received cash bonuses of $17,500.
(4) Mr. Lieberman entered into a 5 year employment contract with the Company's
primary operating subsidiary effective April 1, 1996. Under the contract Mr.
Lieberman is to be paid a base salary of $110,000 for the first year, increased
by $5,000 annually for each of the following two years. In addition, he may be
paid a bonus based on performance targets established by the board of directors.
The employment contract requires the Company to provide certain other benefits
including life and disability insurance, subject to a maximum cost per year. The
contract may be terminated for "cause" immediately or by the employee on 90 days
prior written notice. The contract may also be terminated by the Company in
which event the employee will be paid termination compensation for 180 days.
For the fiscal year ending March 31, 1999, the Company anticipates paying
aggregate direct remuneration (based on current salaries and anticipated
bonuses) of approximately $430,000 to all officers as a group (three persons) of
which Mr. Ferraro and Mr. Lerman will each be paid approximately $155,000 and
Mr. Lieberman will be paid approximately $120,000.
During the fiscal year ended March 31, 1998, $3,900 in directors' fees was
paid to the Company's one director who is not an officer or employee, Anthony C.
Mirabella. It is anticipated that the one director/nominee who is not an officer
or employee will be paid approximately $4,000 in directors' fees in the fiscal
year ending March 31, 1999.
Incentive Stock Options
1992 Incentive Stock Option Plan. On December 16, 1991, the Company's
stockholders approved the adoption of the Company's 1992 Incentive Stock Option
Plan (the "1992 Plan") reserving 500,000 shares of the Company's Common Stock
for issuance pursuant to ISOs which may be granted under the 1992 Plan at
exercise prices at least equal to 100% of the fair market value of the Common
Stock on the date of the effective date of the grant of the option. At October
7, 1998 no 1992 Plan ISOs were outstanding.
No options under the 1992 Plan were granted in fiscal year ended March 31,
1998.
Non-Qualified Stock Incentive Plan
1990 Non-Qualified Stock Incentive Plan. On February 28, 1990, the
Company's stockholders approved the adoption of the Company's 1990 Non-Qualified
Stock Incentive Plan ("1990 Plan") reserving 750,000 shares of the Company's
Common Stock for issuance pursuant to the 1990 Plan in the form of a stock
option, a stock bonus, or a stock appreciation right ("SAR").
The compensation values of the stock bonuses received by the named
executive officers and directors of the Company during the last three fiscal
years are reflected in the Summary Compensation Table in the column labeled
"Restricted Stock Awards".
<PAGE>
Thermodynetics, Inc. Proxy Statement
Page 6
1995 Stock Options. On May 15, 1995, the Company's Board of Directors
approved the adoption of the 1995 Stock Options ("1995 Options") reserving
4,920,000 shares of the Company's Common Stock for issuance in the form of stock
options of which 590,000 options had been reserved for non-management employees.
The purchase price for the exercise of shares subject to the options equaled the
fair market value ("FMV") of the shares of common stock of the Company on the
effective date of the option, May 19, 1995. The 590,000 options are currently
reassignable to members of the management team pro rata in accordance with their
terms; the Company anticipates reassigning such options on or before December
31, 1998. The expiration date of the options is September 30, 2002. See also
Aggregated Exercises and Certain Transactions.
Option Grants in Last Fiscal Year. No options were granted in the last
fiscal year. However, 590,000 of the 1995 Options are currently reassignable to
members of the management team pro rata in accordance with their terms. The
590,000 options are anticipated to be reassigned such that 268,182 will be
reassigned to Mr. Lerman, 268,182 will be reassigned to Mr. Ferraro, 20,114 will
be reassigned to Mr. Lieberman, 6,704 will be reassigned to Mr. Mirabella, and
26,818 will be reassigned to two other individuals. The anticipated reassigned
options are not included in the Aggregated Exercises table below.
Aggregated Exercises
Aggregated Option/SAR Exercises and Fiscal Year End Option/SAR Values. No
options were exercised by any executive officers of the Company during fiscal
year ended March 31, 1998. See also "1995 Stock Options", "Option Grants in Last
Fiscal Year", and "Certain Transactions". The following table reflects the
aggregated option exercise values at year end held by the executive officers and
directors:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
Number of
Securities Value of
Underlying Unexercised
Unexercised in-the-Money
Shares Options at Options at
Acquired FY-End (#) FY-End ($)
Name of on Value Exercisable ("E") Exercisable ("E")
Officer or Director Exercise Realized Unexercisable ("U") Unexercisable ("U")
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
John F. Ferraro 0 $0.00 2,000,000 E $240,000 E
Robert A. Lerman 0 $0.00 2,000,000 E $240,000 E
Anthony C. Mirabella 0 $0.00 50,000 E $ 6,000 E
Robert I. Lieberman 0 $0.00 150,000 E $ 18,000 E
</TABLE>
Employee Retirement Savings Plan
Effective April 1, 1991, the Company adopted the Thermodynetics, Inc.
401(k) Retirement Savings Plan (the "401(k) Plan"). The 401(k) Plan allows
full-time employees of the Company to defer two to fifteen percent of their
earnings on a pre-tax basis through earnings or salary reduction contributions
to the 401(k) Plan. The Company may in its discretion make matching
contributions in the form of Company's common stock equal to a percentage of the
employees' aggregate contributions. Under the 401(k) Plan the board of directors
has the authority in its sole discretion to determine the Company's matching
contribution, if any, for each Plan year. The Company has determined its
matching contributions to the 401(k) Plan for the plan year ending December 31,
1998 will be at the rate of 70% of employee contributions, not to exceed 100,000
shares.
<PAGE>
Thermodynetics, Inc. Proxy Statement
Page 7
The compensation value of the 401(k) participation received by the below
listed officers and directors is reflected in the Summary Compensation Table at
the column labeled "Company Contribution to 401(k) Plan". The following table
sets forth the number of shares of Common Stock contributed to the below
referenced persons or groups of persons during the 401(k) Plan year ended
December 31, 1997, Column (1), and for all years from inception of the Plan
through Plan year ended December 31, 1997, Column (2).
Shares Contributed by the
Company and Held in
Name Trust Under 401(k) Plan
---- -----------------------
Officers and Directors Column (1) Column (2)
---------------------- ---------- ----------
(Aggregate)
John F. Ferraro(a) 6,511 37,120
Robert A. Lerman(a) 12,688 49,251
Robert I. Lieberman -0- 16,939
Anthony C. Mirabella(a) -0- -0-
All officers and directors
as a group(a) (4 persons) 19,199 103,310
Total Matching Contribution 95,362 634,803
to all employees
(30 persons)
- ----------
(a) Trustees of the 401(k) Plan. Excludes the aggregate shares held in trust by
the trustees of the 401(k) Plan for all participating employees.
Other Plans
The Company does not have any pension or similar plan. See footnotes (1)
and (4) to the cash compensation table as to the Company's employment contracts
with Messrs. Ferraro, Lerman and Lieberman containing disability and termination
payment provisions.
Certain Transactions
During the fiscal year ended March 31, 1998, the Company engaged in
transaction(s) with certain officers, directors, beneficial holders of more than
5% of its outstanding voting securities and entities with which they were
affiliated. None of the officers and directors of the Company are engaged in
businesses competitive to the business of the Company. The Company's
transactions with these individuals and entities in the fiscal year most
recently ended are described below.
With the Directors and Officers - A total of 590,000 of the 1995 stock
options are currently reassignable to the management team pro rata in accordance
with their terms; the Company anticipates reassigning such options on or before
December 31, 1998. See "1995 Stock Options" and "Option Grants in Last Fiscal
Year."
Indebtedness of Management - At March 31, 1998 no member of management was
indebted to the Company in excess of $60,000.
Legal Proceedings
There are no material legal proceedings known or threatened against the
Company.
<PAGE>
Thermodynetics, Inc. Proxy Statement
Page 8
Information Concerning Independent Public Auditors
The firm of DiSanto Bertoline & Company, P.C., certified public
accountants, audited the consolidated financial statements of the Company and
its subsidiaries for the fiscal year ended March 31, 1998. DiSanto Bertoline &
Company, P.C. was first appointed to serve as the Company's auditors in
February, 1991. Representatives of such firm are not expected to be present at
the Annual Meeting of Stockholders.
Stockholder Proposals for Next Annual Meeting
Under current rules of the Securities and Exchange Commission, stockholders
wishing to submit proposals for inclusion in the Proxy Statement of the Board of
directors for the 1998 fiscal year end Annual Meeting of Stockholders must
submit such proposals so as to be received by the Company at 651 Day Hill Road,
Windsor, Connecticut 06095 on or before July 1, 1999.
Form 10-KSB Annual Report
A copy of the Company's Annual Report on Form 10-KSB for the year ended
March 31, 1998 as filed with the Securities and Exchange Commission may be
obtained by any stockholder entitled to vote at the December 4, 1998 Annual
Meeting of Stockholders by addressing a written request to the Secretary,
Thermodynetics, Inc., 651 Day Hill Road, Windsor, Connecticut 06095.
OTHER MATTERS
Management does not know of any other matters which are likely to be
brought before the Meeting. However, in the event that any other matters
properly come before the Meeting, the persons named in the enclosed proxy will
vote said proxy in accordance with their judgment on said matters.
By Order of the Board of Directors
Thermodynetics, Inc.
Robert A. Lerman
President
Windsor, Connecticut 06095
October 15, 1998
<PAGE>
PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS PROXY
Please Sign and Return this Proxy Promptly
THERMODYNETICS, INC.
Annual Meeting of Stockholders - December 4, 1998
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby appoints John
F. Ferraro and Robert A. Lerman, or any one of them acting in the absence of the
other, as attorneys and proxies of the undersigned with full power of
substitution, for and in the name of the undersigned, to represent the
undersigned at the Annual Meeting of Stockholders of Thermodynetics, Inc., a
Delaware corporation, to be held at the Company's principal offices at 651 Day
Hill Road, Windsor, Connecticut 06095 at 9:30 A.M. (EST) on Friday, December 4,
1998 and at any adjournments thereof, and to vote all shares of stock of said
Company standing in the name of the undersigned with all the powers which the
undersigned would possess if personally present at such meeting. The undersigned
directs that this Proxy be voted as follows:
1. To elect three (3) directors (Proposal One).
FOR [_] all nominees listed below WITHHOLD AUTHORITY [_]
(except as marked to the contrary below) (to vote for all nominees
listed below)
Nominees: John F. Ferraro, Robert A. Lerman, Anthony C. Mirabella
If it is desired to withhold authority to vote for any individual
nominee, check the FOR box above and strike out the name of the
nominee for whom you desire to withhold voting authority.
2. In their discretion, on all other matters that may properly come before the
meeting.
AUTHORITY GRANTED [_] AUTHORITY WITHHELD [_]
(Continued and to be signed on other side)
<PAGE>
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE GIVEN FOR
ANY ITEM, THIS PROXY WILL BE VOTED FOR THAT ITEM. DISCRETIONARY AUTHORITY IS
HEREBY CONFERRED AS TO ALL OTHER MATTERS THAT MAY COME BEFORE THE MEETING.
STOCKHOLDERS WHO ARE PRESENT AT THE MEETING MAY WITHDRAW THEIR PROXY AND VOTE IN
PERSON IF THEY SO DESIRE.
Dated: ____________________________ 1998
________________________________________
________________________________________
(Signature of Stockholder)
Please sign exactly as name appears on
this Proxy. If shares are registered in
more than one name, the signatures of
all such persons are required. A
corporation should sign in its full
corporate name by a duly authorized
officer, stating his title. Trustees,
guardians, executors and administrators
should sign in their official capacity,
giving their full title as such. If a
partnership, please sign in partnership
name by authorized person.
PLEASE SIGN AND RETURN THIS PROXY PROMPTLY
No postage is required if returned in the enclosed envelope and
mailed in the United States
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
