<PAGE> 1
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:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
/X/ Definitive Proxy Statement Only (as permitted by Rule 14a-6(e)(2)
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
</TABLE>
GENERAL AUTOMATION, 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/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
----------------------------------------------------------------------
(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> 2
GENERAL AUTOMATION, INC.
17731 MITCHELL NORTH
IRVINE, CALIFORNIA 92714
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JANUARY 25, 1996
TO THE STOCKHOLDERS OF GENERAL AUTOMATION, INC.:
NOTICE IS HEREBY GIVEN, that the Annual Meeting of Stockholders of
General Automation, Inc., a Delaware corporation (the "Company") will be held
on Thursday, January 25, 1996 at 10:00 o'clock a.m., Pacific Standard Time, at
the principal executive offices of the Company, located at 17731 Mitchell
North, Irvine, California, for the following purposes:
1. To elect six directors to hold office until the next annual
meeting of stockholders and until their successors are
elected and qualified; and
2. To transact such other business as may properly come before
the meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice. The Board of Directors has fixed the close
of business on December 1, 1995 as the record date for the determination of
stockholders entitled to receive notice of and to vote at this Annual Meeting
and any adjournment or postponement thereof.
BY ORDER OF THE BOARD OF DIRECTORS
LAWRENCE MICHELS
CHAIRMAN
Irvine, California
December 29, 1995
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN
PERSON. WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE,
DATE, SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO
ENSURE YOUR REPRESENTATION AT THE MEETING. A RETURN ENVELOPE (WHICH IS POSTAGE
PREPAID IF MAILED IN THE UNITED STATES) IS ENCLOSED FOR THAT PURPOSE. EVEN IF
YOU HAVE GIVEN YOUR PROXY, YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE
MEETING. PLEASE NOTE, HOWEVER, THAT IF YOUR SHARES ARE HELD OF RECORD BY A
BROKER, BANK OR OTHER NOMINEE AND YOU WISH TO VOTE AT THE MEETING, YOU MUST
BRING TO THE MEETING A LETTER FROM THE BROKER, BANK OR OTHER NOMINEE CONFIRMING
YOUR BENEFICIAL OWNERSHIP OF THE SHARES. ADDITIONALLY, IN ORDER TO VOTE AT
THE MEETING, YOU MUST OBTAIN FROM THE RECORD HOLDER A PROXY ISSUED IN YOUR
NAME.
<PAGE> 3
GENERAL AUTOMATION, INC.
17731 MITCHELL NORTH
IRVINE, CALIFORNIA 92714
PROXY STATEMENT
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed proxy is solicited on behalf of the Board of Directors of
General Automation, Inc., a Delaware corporation (the "Company"), for use at
the Annual Meeting of Stockholders to be held on Thursday, January 25, 1995 at
10:00 o'clock a.m., Pacific Standard Time, at the principal executive offices
of the Company, located at 17731 Mitchell North, Irvine, California, or at any
adjournment thereof (the "Annual Meeting"), for the purposes set forth herein
and in the accompanying Notice of Annual Meeting.
SOLICITATION
The cost of soliciting proxies relating to the Annual Meeting will be
paid by the Company. Directors, officers and employees of the Company may,
without additional compensation, solicit proxies from stockholders, which
solicitation may be made by telephone, telegram or personal interview.
Brokerage houses, other custodians, nominees and fiduciaries will be requested
to forward soliciting materials to the beneficial owners of stock held of
record by such persons and will be reimbursed by the Company for expenses
incurred in doing so.
This Proxy Statement and the accompanying Notice of Meeting and proxy
card are first being mailed to stockholders on or about January 5, 1995.
STOCKHOLDER PROPOSALS
Any stockholder who intends to present a proposal at the Company's
next annual meeting for the 1996 fiscal year is advised that, in order for such
proposal to be included in the Board of Directors' proxy materials for such
meeting, the proposal must be received by the Company at its principal
executive office no later than August 21, 1996, directed to the Secretary of
the Company, and the proponent and the proposal must meet certain eligibility
requirements under rules promulgated by the Securities and Exchange Commission.
VOTING RIGHTS AND OUTSTANDING SHARES
Only stockholders of record at the close of business on December 1,
1995 will be entitled to notice of and to vote at the Annual Meeting or any
adjournment thereof. As of December 1, 1995, 7,391,776 shares of the Company's
Common Stock, par value $.10 per share, were outstanding.
The presence, either in person or by proxy, of persons entitled to
vote a majority of the outstanding shares of the Company's Common Stock is
necessary to constitute a quorum for the transaction of business at the Annual
Meeting. Abstentions and broker non-votes are counted for purposes of
determining a quorum.
<PAGE> 4
Each share is entitled to one vote on all matters voted on at the
Annual Meeting and, in the election of directors, each stockholder has the
right to cumulate his votes. Cumulative voting rights entitle a stockholder to
give one nominee as many votes as is equal to the number of directors to be
elected multiplied by the number of shares owned by him or to distribute his
votes on the same principle among two or more nominees as he sees fit. The six
nominees for director receiving the highest number of votes at the Annual
Meeting will be elected. In order for one or all stockholders to be entitled
to cumulate votes, a stockholder must give notice at the Annual Meeting prior
to the voting of his intention to cumulate his votes. Unless otherwise
directed, the shares represented by the accompanying proxy will be voted in the
discretion of the persons named therein so as to elect the maximum number of
the six director nominees listed below which may be elected by cumulative
voting.
The persons named in the accompanying proxy have advised the Company
that they will vote the shares represented by proxies received by them in
accordance with the stockholders' directions. If the proxy is signed and
returned without direction as to how to vote, the proxy holders will vote "FOR"
Proposal 1 as listed below. As to any other matters which may properly come
before the Annual Meeting, the proxy holders will vote in accordance with their
best judgment, although the Company does not presently know of any other such
matters.
REVOCABILITY OF PROXIES
A stockholder giving a proxy pursuant to this solicitation has the
power to revoke it at any time before it is exercised. It may be revoked by
filing with the Secretary of the Company, at the Company's principal executive
office, 17731 Mitchell North, Irvine, California 92714, a written revocation or
a duly executed proxy bearing a later date, or it may be revoked by attending
the Annual Meeting and voting in person. Attendance at the Annual Meeting will
not, by itself, constitute revocation of the proxy.
2
<PAGE> 5
PROPOSAL 1
ELECTION OF DIRECTORS
The persons who are elected directors will hold office until the next
annual meeting of stockholders and until their successors are elected and
qualified or until their death, resignation or removal. The Company's By-Laws
authorize a minimum of five and a maximum of eight directors and authorize the
Board of Directors to fix the exact number, which the Board has fixed at six.
Officers of the Company are appointed annually by the Board.
Unless instructed to the contrary, shares represented by proxies will
be voted FOR the election of the six nominees named below. If any shares are
voted at the Annual Meeting for the election of any person other than those
nominees named herein, the discretionary authority given to the designated
proxy holders includes the authority to cumulate votes for any one or more of
the nominees listed below in such manner as the proxy holders deem desirable.
In such event, the proxy holders intend to cumulate votes which they are
entitled to cast so as to elect as directors as many of the nominees named
herein as possible.
Each person nominated for election has agreed to serve if elected and
management has no reason to believe that any nominee will be unable to serve.
In the event that any nominee should be unavailable for election as a result of
an unexpected occurrence, shares represented by executed proxies will be voted
for the election of such substitute nominee or nominees as management may
propose.
The six candidates receiving the highest number of affirmative votes
cast at the Annual Meeting will be elected directors of the Company.
Abstentions or broker non-votes as to the election of directors will be not
affect the election of candidates receiving the plurality of votes.
MANAGEMENT RECOMMENDS A VOTE IN FAVOR OF EACH NAMED NOMINEE.
NOMINEES
Set forth below is information regarding the nominees, including
information furnished by them as to their principal occupations for the last
five years, certain other directorships held by them and their ages as of
December 10, 1995.
<TABLE>
<CAPTION>
Director
Name Since Positions with the Company
- ---- -------- --------------------------
<S> <C> <C>
Lawrence Michels(1)(2) 1990 Chairman of the Board, Director
Leonard N. Mackenzie 1980 Vice Chairman of the Board, Director
Robert D. Bagby 1989 President, Chief Executive Officer, Director
Philip T. Noden(1)(2) 1989 Director
Paul L. Morigi(1)(2) 1990 Director
Robert M. McClure(1) 1994 Director
</TABLE>
(1) Member of the Audit Committee
(2) Member of the Compensation Committee
3
<PAGE> 6
Lawrence Michels (64) was elected to the Board of Directors in August
1990 and in August 1993 he was appointed Chairman of the Board of Directors of
the Company. Mr. Michels was President and Chief Executive Officer of The
Santa Cruz Operation, Inc., an international leader in the UNIX and open
systems. From 1979 until December 1992 he was President and Chief Executive
Officer of The Santa Cruz Operation, Inc. Previously he held the positions of
Vice President at TRW and President of TRW Data Systems. Mr. Michels has been
providing management consulting for various companies since 1992.
Leonard N. Mackenzie (58) served as the Company's Chairman of the
Board, President and Chief Executive Officer from 1980 to August 1988, at which
time he resigned those positions and was appointed Vice Chairman of the Board.
Mr. Mackenzie reassumed the position of President and Chief Executive Officer
of the Company in January 1990. In February of 1994 he resigned his position
as President but retained his current positions as Vice Chairman and Chief
Executive Officer, and in October 1994 he resigned his position as Chief
Executive Officer.
Robert D. Bagby (63) was elected to the Board of Directors in
September 1989. Mr. Bagby was the Company's Vice President of Operations from
1987 to 1994. In February of 1994 he was appointed President and Chief
Operating Officer and in October 1994 he was appointed Chief Executive Officer,
succeeding Leonard N. Mackenzie.
Philip T. Noden (53) has been a director of the Company since January
1989. Since 1983 he has been a member of the Board of Directors and Technical
Director of Sanderson Electronics PLC. ("Sanderson"), a United Kingdom-based
developer and supplier of applications software.
Paul L. Morigi (74) was elected to the Board of Directors in August
1990. Since 1987 he has been President of Paul Morigi & Company, Inc., a New
York stock brokerage firm. From 1982 to 1987 he was Senior Vice President and
a director of Advest, Inc., a stock brokerage firm.
Robert M. McClure (59) was elected to the Board in April 1994. Mr.
McClure is the President of Unidot, Inc., which he founded in 1979 to
specialize in the design of sophisticated computer software and hardware. Mr.
McClure also serves as a director of The Santa Cruz Operation, Inc.
EXECUTIVE OFFICERS
For information regarding the Company's executive officers who are
also directors of the Company, please see "Election of Directors" above.
Information regarding executive officers of the Company who are not also
directors of the Company follows.
John R. Donnelly (61) joined the Company in 1994 as Vice President
Finance, Chief Financial Officer and Secretary. Since graduating from the
University of Notre Dame, Mr. Donnelly has held senior management positions
with a number of firms including Martin Marrieta (Denver) as Chief of Long
Range Planning, ITT Cannon as Manager of Resource Planning and Assistant
Controller, Maxwell Laboratories as Vice President of Finance and Executive
Vice President, Science Applications, Inc. (SAI) as Vice President of Finance,
and Infodetics Corporation as Vice President of Finance.
4
<PAGE> 7
Jane M. Christie (44) joined the Company in 1979. In 1987 she was
made responsible for the Company's services division as well as the vertical
solutions group. Over the last twenty years, Ms. Christie has held various
senior executive positions within the Company, Sorbus and First Data Resources.
In August 1995 she became an officer of the Company and is currently serving as
Senior Vice President of Customer Services, Sales and Marketing.
BOARD MEETINGS AND COMMITTEES
During the fiscal year ended September 30, 1995, the Board of
Directors held a total of 5 meetings. Each director attended at least 75% of
the meetings of the Board and the Committees of which he was a member. The
Board has a Compensation Committee and an Audit Committee. The Board has no
Nominating Committee.
The Audit Committee meets with the Company's independent accountants
at least annually to review the results of the annual audit and discuss the
financial statements; recommends to the Board the independent accountants to be
retained; and receives and considers the accountants' procedures in connection
with the audit and financial controls. The Audit Committee, which during the
fiscal year ended September 30, 1995 was composed of Messrs. Michels, Morigi,
McClure and Noden, met once at meetings specially called for the Audit
Committee.
The Compensation Committee has the authority to award stock options to
employees and consultants under the Company's stock option plans and to perform
such other functions regarding compensation as the Board may delegate. The
Compensation Committee, which is composed of Messrs. Michels, Morigi and
Noden, met once during the fiscal year ended September 30, 1995.
There are no family relationships among the directors or executive
officers of the Company.
COMPENSATION OF DIRECTORS
During the fiscal year ended September 30,1995, directors who were not
employees of the Company each received a monthly retainer of $1,200 and the
Chairman received a monthly retainer of $3,500. Directors who were also
employees of the Company received no additional remuneration for serving as a
director.
5
<PAGE> 8
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table, based in part upon information supplied by
executive officers, directors and principal stockholders, sets forth certain
information regarding the ownership of the Company's voting securities as of
December 1, 1995 by (i) all those known by the Company to be beneficial owners
of more than five percent of any class of the Company's voting securities; (ii)
each director and nominee for director; (iii) each of the Named Executive
Officers (as defined in page 7 hereof); and (iv) all current executive
officers and directors of the Company as a group. Unless otherwise indicated,
the address of each such shareholder is c/o General Automation, Inc., 17731
Mitchell North, Irvine, California 92714. Except to the extent indicated in
the footnotes, each of the stockholders listed below has sole voting and
investment power with respect to the shares listed opposite such shareholder's
name.
<TABLE>
<CAPTION>
Beneficial Ownership(1)
---------------------------
Name and Address Title of Number of Percent of
of Beneficial Owner Class Shares Class
- ------------------- -------- --------- ----------
<S> <C> <C> <C>
Sanderson Technology Limited(2)
Parkway House
Parkway Avenue Common 442,588 5.99%
Sheffield, S9 4WA
England
Robert D. Bagby(3) Common 587,901 7.95%
Leonard N. Mackenzie(3) Common 927,433 5.77%
Robert M. McClure(3) Common 60,000 *
Lawrence Michels(3) Common 809,833 10.96%
Paul L. Morigi(3) Common 203,200 2.75%
Philip T. Noden(4) Common 442,588 5.99%
All current executive officers and
directors as a group Common 3,471,015 46.96%
(8 persons)(5)
</TABLE>
* Less than 1%
(1) The number and percentage ownership for each beneficial owner is
calculated as if all options or warrants held by such owner that are
currently exercisable or exercisable within 60 days after December 1, 1995
were exercised and such shares ("beneficially
6
<PAGE> 9
owned" shares) were included in the numerator as shares owned and in
the denominator as shares outstanding for purposes of the calculation for
such beneficial owner only.
(2) Includes 442,588 shares held directly. Sanderson Technology Limited
also holds certain rights, commonly referred to as "Mirror Rights," to
acquire additional warrants to acquire Common Stock of the Company in the
event options under the Company's stock option plans or warrants that were
outstanding as of January 6, 1989 and held by parties other than Sanderson
are exercised. As of December 1, 1995, such Mirror Rights covered 630,000
shares of Common Stock. If issued, warrants granted pursuant to the
Mirror Rights would be exercisable for a period of ninety days for the
number of shares and at the exercise price of the options or warrants the
exercise of which triggered the issuance of such warrants.
(3) Shares listed for Bagby, Mackenzie, Michels, McClure and Morigi
include 585,000, 885,000, 50,000, 50,000 and 50,000 shares, respectively,
that may be acquired through the exercise of stock options.
(4) Includes the 442,588 shares held directly by Sanderson Technology
Limited, of which Mr. Noden may be deemed a beneficial owner. Sanderson
Technology Limited is a wholly-owned subsidiary of Sanderson, and Mr.
Noden is a member of the board of directors of Sanderson.
(5) Includes 2,120,000 shares that may be acquired through the exercise of
stock options. Also includes 442,588 shares held by Sanderson Technology
Limited. See footnotes 3 and 4 above.
EXECUTIVE COMPENSATION
The following table sets forth certain information concerning the
annual and long-term compensation for each of the three fiscal years ended
September 30, 1995 of those persons who at September 30, 1995 were either (i)
the Company's Chief Executive Officer or (ii) one of its most highly
compensated executive officers whose salary and bonus during the fiscal year
ended September 30, 1995, exceeded $100,000 (collectively, the "Named Executive
Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Annual Compensation(1) Compensation(1)
--------------------------------- ---------------
Awards
---------------
Securities All Other
Name and Underlying Compensation
Principal Position Year Salary($) Bonus($) Options(#) ($)(2)
------------------ ---- --------- -------- --------------- ------------
<S> <C> <C> <C> <C> <C>
Leonard N. Mackenzie 1995 123,565 -0- 485,000
Vice Chairman of Board 1994 171,965 -0- -0-
of Directors and CEO 1993 209,035 -0- -0
Robert D. Bagby 1995 140,000 -0- 485,000 4,200
President, CEO 1994 129,368 -0- -0- 3,351
and Director 1993 125,691 -0- -0- 3,426
</TABLE>
7
<PAGE> 10
(1) The Company made no long-term incentive plan payouts to its Named
Executive Officers during the 1993, 1994 and 1995 fiscal years.
(2) Includes contributions to the Company's Employee Savings Plan on behalf
of the Named Executive Officers to match contributions (included under
Salary) made by each to such plan.
COMPENSATION OF DIRECTORS
During the fiscal year ended September 1995, directors who were not
employees of the Company each received a monthly retainer of $1,200 and the
Chairman received a monthly retainer of $3,500. Directors who were also
employees of the Company received no additional remuneration for serving as a
director.
STOCK OPTION GRANTS
The following table sets forth certain information regarding options
granted to the Named Executive Officers during the fiscal year ended September
30, 1995:
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Number of Percent of Potential
Securities Total Realizable Value
Under- Options/ at Assumed Annual
lying SAR's Rates of Stock Price
Options/ Granted to Exercise Appreciation
SAR's Employees or Base for Option Term
Granted in Fiscal Price Expiration --------------------
Name (#) Year ($/Sh) Date 5%($) 10%($)
- ---- --------- ---------- -------- ---------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Leonard N. Mackenzie 485,000 38% 0.86 3/2000 47,142 168,731
Robert D. Bagby 485,000 38% 0.86 3/2000 47,142 168,731
</TABLE>
OPTION EXERCISES AND YEAR-END OPTION VALUES
The following table sets forth the number of shares of Common Stock
issuable upon the exercise of outstanding stock options held by each of the
Named Executive Officers at September 30, 1995. The exercise price of each
option was higher than the closing price of the Company's Common Stock at
year-end and thus none of these options were "in-the-money" as of such date.
None of the Named Executive Officers exercised any stock options during the
fiscal year ended September 30, 1995.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised
Options/SARs at FY-End (#)
--------------------------------------
Name Exercisable Unexercisable
---- ----------- -------------
<S> <C> <C>
Leonard N. Mackenzie 885,000 0
Robert D. Bagby 585,000 0
</TABLE>
8
<PAGE> 11
The following Compensation Committee Report and Performance Graph are
not to be deemed to be incorporated by reference to any filing by the Company
under the Securities Act of 1933 or the Securities Exchange Act of 1934, except
to the extent that the Company specifically incorporates it by reference.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The role of the Compensation Committee is to carry out the
compensation responsibilities of the Board of Directors, which involve the
discussion, research and approval of the recommendations of management with
regard to the compensation (including cash and non-cash) of the executive
officers of the Company. This report sets forth the major components of
executive compensation and the basis by which fiscal year 1995 compensation
determinations were made with respect to the executive officers of the Company,
including those named in the Summary Compensation Table.
Compensation Policy and Guidelines
- ----------------------------------
The goals of the Company's compensation policy are to align executive
compensation with the Company's long-term business objectives and performance,
to enable the Company to attract and retain high-quality executive officers and
employees who will contribute to the long-term success of the Company and to
reward such executive officers and employees for their successful efforts in
attaining objectives beneficial to the growth and profitability of the Company.
In order to achieve the Company's goals, executive officers are
compensated at base salary levels which are generally competitive with
prevailing industry standards, and are provided with incentive bonus awards
based upon profitability. Another long-term goal of the compensation program
is to align the financial interests of the Company's executive officers with
those of the Company's stockholders. Compensation has been based upon the
following factors: The strengths and weaknesses of the individual executive
officers, the Board's perception of such individual's historical performance
and expected future contributions to the success of the Company.
Compensation Program Elements
- -----------------------------
The Company's compensation levels and benefits are reviewed on an
annual basis to determine whether they are competitive and reasonable in light
of the overall performance of the Company and the Company's ability to attract
and retain talented executives. The particular elements of the compensation
programs for the executive officers are explained in more detail below.
Salary. Salary levels are primarily determined by the Compensation
Committee in consideration of the performance of the individual
executive, the financial performance of the Company and the prevailing
industry standards for similar executives of similar companies. The
Board of Directors believes that the base salary levels for the
Company's executive officers in 1995 were competitive within a range
considered to be reasonable and necessary.
SUBMITTED BY THE COMPENSATION COMMITTEE
Lawrence Michels
Paul Morigi
Philip Noden
9
<PAGE> 12
PERFORMANCE GRAPH
The following graph compares the cumulative, five-year shareholder
returns on the Company's Common Stock with the shareholder returns of the AMEX
Computer Technology Index and a peer group index comprised of the common stock
of the companies listed below, excluding the Company. The peer group index is
based on a selection of companies operating in the same industry and whose
common stock is traded on the NYSE or NASDAQ Stock Market. The graph assumes
that the value of the investment in the Company's Common Stock and each index
was $100 on September 30, 1990.
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
G.A. 100.00 125.00 200.00 137.50 100.00 150.00
PEER GROUP 100.00 103.34 82.71 97.77 77.41 4.15
AMEX INDEX 100.00 121.81 128.09 139.16 165.17 268.30
</TABLE>
10
<PAGE> 13
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
At September 30, 1995, the Company had loans outstanding in the
amounts of $449,803 issued in 1987 through a private placement by Paul Morigi &
Company, of which Paul Morigi, a director of the Company, is the President. In
1995, the note holder, Capuchin Order, Providence of St. Joseph, entered into a
plan of repayment which calls for full payment by January, 1997. All payments
are made to a directed depository; no interest payments were paid to Paul
Morigi & Company in fiscal 1995.
On November 10, 1994, the Company sold its entire interest in SGA
Pacific Limited, an Australian corporation which was a 51% owned subsidiary of
the Company, to Sanderson Technology Limited ("STL"). In consideration, STL
paid the Company $1,000,000 in cash, delivered to the Company a promissory note
in the principal amount of $1,000,000 payable over 24 months, and transferred
4,100,000 shares of the Company's Common Stock back to the Company. As a
result, Sanderson's beneficial ownership of the Company's Common Stock has been
reduced to under 10%. See "Security Ownership of Certain Beneficial Owners and
Management." Mr. Philip Noden, a director of the Company, is a member of the
Board of Directors and Technical Director of Sanderson Electronics PLC
("Sanderson"), of which STL is a wholly-owned subsidiary.
A portion of the consideration paid by STL to the Company consisted of
4,100,000 shares of the Company's outstanding Common Stock. Of these shares,
2,275,000 shares (the "GA Group Shares") were acquired by STL, immediately
prior to the closing, from The GA Group and Mr. Donald Rutherford in exchange
for cancellation by STL of the remaining unpaid principal amount of a loan
previously made by STL to the partners of The GA Group and Mr. Donald
Rutherford. The GA Group is a general partnership originally composed of
Messrs. Lawrence Michels, Chairman of the Board of the Company, Leonard
Mackenzie, Vice Chairman of the Board of the Company, Robert D. Bagby,
President, Chief Executive Officer and director of the Company, and Donald
Rutherford, formerly Vice President Finance and a director of the Company (the
"Purchasers"). Under an Agreement with STL dated August 27, 1993 (the "GA
Group/STL Agreement"), the Purchasers acquired the GA Group Shares from STL for
L1,200,000. Under the GA Group/STL Agreement, the entire purchase price for
the GA Group Shares had been treated as a loan to the Purchasers by STL (the
"STL Loan"), all of which remained outstanding at November 10, 1994. On
November 10, 1994, the exchange rate for the British Pound Sterling was US
$1.61.
Sanderson Technology Limited and its affiliates continue to acquire
the Company's products in significant quantities, which aggregate purchases in
fiscal 1995 to approximately $671,000. As of September 30, 1995, the Company
had trade accounts receivable of approximately $154,000 due from Sanderson.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers, directors and persons who own more than 10% of a
registered class of the Company's equity securities to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
and the American Stock Exchange. Such persons are also required by SEC
regulations to furnish the Company with copies of the Section 16(a) forms which
they file.
During the fiscal year ended September 30, 1995, Mr. Morigi, a
director of the Company, was not timely with respect to the filing of one
report relating to one transaction involving the purchase of shares of the
Company's Common Stock by Mr. Morigi.
11
<PAGE> 14
FINANCIAL REPORTS
The Company's Annual Report for the year ended September 30, 1995 is
being mailed together with this Proxy Statement.
THE COMPANY WILL PROVIDE, WITHOUT CHARGE, A COPY OF ITS ANNUAL REPORT
ON FORM 10-K, INCLUDING FINANCIAL STATEMENTS, FINANCIAL STATEMENTS SCHEDULES
AND A LIST OF EXHIBITS, UPON WRITTEN REQUEST, TO ANY PERSON WHO WAS THE
BENEFICIAL OWNER OF THE COMPANY'S VOTING SECURITIES AS OF THE RECORD DATE.
REQUESTS SHOULD BE DIRECTED TO THE COMPANY AT 17731 MITCHELL NORTH, IRVINE,
CALIFORNIA 92714, ATTENTION SECRETARY. EXHIBITS TO THE FORM 10-K WILL BE MADE
AVAILABLE UPON A REASONABLE CHARGE.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Price Waterhouse, the Company's independent accountants for the fiscal
year ended September 30, 1995, has been selected by the Board of Directors,
upon recommendation of the Audit Committee, to act in the same capacity for the
fiscal year ending September 30, 1996.
Representatives of Price Waterhouse are expected to be present at the
Annual Meeting, and will be given an opportunity to make a statement if they
desire to do so and are expected to be available to respond to appropriate
questions from stockholders.
OTHER MATTERS
Management knows of no other matters to be presented for consideration
at the Annual Meeting. If, however, any other matters should properly come
before the Annual Meeting, it is the intention of the persons named in the
accompanying proxy to vote such proxy in accordance with their best judgment on
such matters.
FOR THE BOARD OF DIRECTORS
Lawrence Michels
Chairman
December 29, 1995
12
<PAGE> 15
PROXY
GENERAL AUTOMATION, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JANUARY 25, 1996
The undersigned hereby appoints Leonard N. Mackenzie and Robert D. Bagby, and
each of them, as attorneys and proxies of the undersigned, with full power of
substitution, to vote all of the shares of stock of General Automation, Inc.
which the undersigned may be entitled to vote at the Annual Meeting of
Stockholders of General Automation, Inc. to be held on Thursday, January 25th,
1996 at 10:00 o'clock a.m., Pacific Standard Time, at the principal executive
offices of the Corporation, located at 17731 Mitchell North, Irvine,
California, and at any and all adjournments and postponements thereof, as
follows:
IMPORTANT -- PLEASE SIGN OTHER SIDE
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE> 16
MANAGEMENT RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTOR LISTED BELOW.
1. ELECTION OF DIRECTORS: NOMINEES: Robert D. Bagby, Leonard N. Mackenzie,
FOR all nominees WITHHOLD Lawrence Michels, Paul L. Morigi,
listed to the AUTHORITY Robert M. McClure, Phillip T. Noden
right except to vote for
as marked to all nomi- (INSTRUCTION: To withhold authority to vote for
the contrary). nees listed. any nominee(s), write such
nominee(s)' name(s) below.)
/ / / /
-----------------------------------------------
This proxy, when properly
2. OTHER MATTERS executed, will be voted as
In their discretion, the proxies named specified herein. If no choice
herein are authorized to vote upon such is specified, this proxy will
other business as may properly come be- be voted for the election of
fore the meeting or any adjournment or all nominees named above, and
postponement thereof, including proce- in accordance with the best
dural and other matters relating to the judgment of the proxy holders
conduct of the meeting. with respect to matters
incident to the conduct of the
/ / / / meeting and any other matters
which may properly come before
the meeting.
Dated: , 1996
------------------
-------------------------------
Signature(s)
Please sign exactly as your
name appears hereon. If the
stock is registered in the
names of two or more persons,
each should sign. Executors,
administrators, trustees,
guardians and attorneys-in-fact
should add their titles. If
signer is a corporation, please
give full corporate name and
have a duly authorized officer
sign, stating title. If signer
is a partnership, please sign
in partnership name by
authorized person.
PLEASE VOTE, SIGN, DATE AND PROMPTLY RETURN THIS PROXY
IN THE ENCLOSED POSTPAID ENVELOPE.
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
