Microwave Filter Company, Inc.
6743 Kinne Street
East Syracuse, New York 13057
Notice of Annual Meeting of Shareholders
To the Shareholders of Microwave Filter Company, Inc.:
At the direction of the Board of Directors of Microwave Filter Company,
Inc., a New York corporation (the "Company"), notice is hereby given that the
Annual meeting of Shareholders of the Company (the "Meeting") will be held at
10:00 a.m. on Thursday, April 15, 1999 at the Embassy Suites Hotel, 6646 Old
Collamer Road, East Syracuse, New York 13057 for the purpose of voting on the
following matters:
Proposal 1. The election of 3 directors to hold office until the Annual
Meeting of the Shareholders at which their term expires or until their
successors have been duly elected.
Proposal 2. The ratification of PricewaterhouseCoopers LLP as the
Company's independent auditors for the fiscal year ending September 30, 1999.
The Board of Directors has fixed the close of business on February 23,
1999 as the record date for the determination of shareholders entitled to
notice of and to vote at the Meeting, or any adjournments thereof.
By order of the Board of Directors
Louis S. Misenti
Chairman of the Board
Dated: March 19, 1999
Syracuse, New York
YOUR VOTE IS IMPORTANT. YOU ARE THEREFORE REQUESTED TO SIGN
AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE, EVEN IF
YOU EXPECT TO BE PRESENT AT THE MEETING. YOU MAY WITHDRAW
YOUR PROXY AT ANY TIME PRIOR TO THE MEETING, OR IF YOU DO
ATTEND THE MEETING, YOU MAY WITHDRAW YOUR PROXY AT THAT TIME
AND VOTE IN PERSON IF YOU WISH.
<PAGE>
MICROWAVE FILTER COMPANY, INC.
Proxy Statement for Annual Meeting of Shareholders
General
The enclosed Proxy is solicited on behalf of the Board of Directors of
Microwave Filter Company, Inc. (the "Company") for use at the Company's Annual
Meeting of Shareholders (the "Annual Meeting") to be held on Thursday, April
15, 1999 at 10:00 a.m. local time or at any adjournment or postponement
thereof, for the purposes set forth herein and in the accompanying Notice of
Annual Meeting of Shareholders. The Annual Meeting will be held at the
Embassy Suites Hotel, 6646 Old Collamer Road, East Syracuse, New York 13057.
The Company's principal executive offices are located at 6743 Kinne
Street, East Syracuse, New York 13057. The telephone number at that address
is (315) 438-4700.
These proxy solicitation materials and the Annual Report to
Shareholders were first mailed on or about March 19, 1999 to all shareholders
entitled to vote at the Annual Meeting.
Record Date and Shares Outstanding
Shareholders of record at the close of business on February 23, 1999
are entitled to notice of, and to vote at, the Annual Meeting. At the record
date 3,292,866 shares of the Company's common stock were issued, outstanding
and entitled to vote at the Annual Meeting.
Revocability of Proxies
Any proxy given pursuant to this solicitation may be revoked by the
person giving it at any time before its use by delivering to the Secretary of
the Company a written notice of revocation or a duly executed proxy bearing a
later date or by attending the Annual Meeting and voting in person.
Voting and Solicitation
Every shareholder voting for the election for Directors and on the
other matters presented in this proxy is entitled to one vote for each share
held of record on the record date. Directors are elected by a plurality of
the votes cast at the meeting. Abstentions count for the purpose of
determining a quorum. Broker non-votes do not count for the purpose of
determining a quorum. Abstentions will not count as a vote for proposals 1
and 2. Broker non-votes will count as a vote for proposals 1 and 2.
The cost of this solicitation will be borne by the Company. The
Company has retained Regan & Associates to assist in the solicitation of
proxies at a fee of $8,000 (which includes expenses.) In addition, the Company
may reimburse brokerage firms and other persons representing beneficial owners
of shares for their expenses in forwarding solicitation material to such
beneficial owners. Proxies also may be solicited by certain of the Company's
directors, officers and regular employees, without additional compensation,
personally or by telephone or by telegram.
<PAGE>
Deadline for Receipt of Shareholder Proposals
Proposals of shareholders which are intended to be presented by such
shareholders at the Company's 2000 Annual Meeting must be received by the
Secretary of the Company at the Company's principal executive offices no later
than November 3, 1999 in order to be included in the proxy soliciting material
relating to that meeting.
Board Meetings and Committees
The Board of Directors held a total of four meetings during the fiscal
year ending September 30, 1998. No Director attended fewer than 75% of all
such meetings of the Board of Directors and of the Committees, if any, on
which such Directors served.
The Company's Finance and Audit Committee currently consists of
Sidney Chong, Chair, Daniel Galbally, Frank S. Markovich and Robert R.
Andrews. The Finance and Audit Committee reviews and approves the scope of
the audit performed by the Company's independent auditors as well as the
Company's accounting principles and internal accounting controls. The Finance
and Audit Committee held one meeting during fiscal year 1998.
The Company's Compensation Committee currently consists of Trudi B.
Artini, Chair, Sidney Chong, David B. Robinson, M.D., and Daniel Galbally.
The Compensation Committee reviews compensation and benefits for the Company's
executives. The Compensation Committee held one meeting during fiscal year
1998.
The Company's Nominating Committee currently consists of David B.
Robinson, M.D., Chair, Trudi B. Artini, Carl F. Fahrenkrug, P.E., Milo
Peterson and Frank S. Markovich. The Nominating Committee will consider
nominees for the Board of Directors recommended by shareholders if such
recommendations are in writing and are mailed to the Secretary of the Company
at the Company's principal executive office. The Nominating Committee did not
hold any meetings during fiscal year 1998.
The Company also has a standing Executive Committee.
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Compensation of Directors
Non-officer directors received fees of $400.00 per board meeting and
$300.00 per committee meeting, with the exception of the executive committee
which received $400.00 per committee meeting, during fiscal 1998. MFC also
reimburses directors for reasonable expenses incurred in attending meetings.
The Chairman of the Board and Officer members receive no compensation for
their attendance at meetings. During fiscal 1998, the Company paid Louis S.
Misenti $16,500 in compensation (part of which was taken in stock) for his
services as Chairman of the Board of Directors of Microwave Filter Company,
Inc. In addition, the Company paid Louis S. Misenti $30,600 during fiscal 1998
for consulting services. Outside directors have the option of receiving their
compensation for meetings in the form of restricted shares of the Company's
common stock. For this purpose, shares are valued at 85% of the mean between
the bid and ask price of the stock at the beginning of each quarter. During
fiscal 1998, 19,474 shares were issued to Directors in lieu of Directors'
fees and services:
Number of Shares Issued In
Director Lieu of Directors' Fees
Sidney Chong 4,461
Louis S. Misenti 15,013
<PAGE>
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding
beneficial ownership of the Company's common stock as of February 23, 1999 (i)
by each person who is known by the Company to own beneficially more than 5% of
the Company's common stock, (ii) each Director of the Company and (iii) all
Directors and Executive Officers as a group.
Directors, Officers Shares Beneficially Owned
5% Shareholders Number Percent
Carl F. Fahrenkrug * 384,566 11.7%
and Rita Fahrenkrug
8365 Indian Hill Road
Manlius, NY 13104
Louis S. Misenti * 395,090 12.0%
140 Clearview Road
Dewitt, NY 13214
Milo Peterson * 168,570 5.1%
Trudi B. Artini * 108,815 3.3%
David B. Robinson, M.D.* 116,332 3.5%
Frank S. Markovich * 4,508 **
Daniel Galbally * 1,489 **
Sidney Chong * 11,707 **
Robert R. Andrews * 1,214 **
All Directors and Executive
Officers as a group (ten persons) 1,223,199 37.1%
*Directors of the Company.
**Denotes less than one percent of class.
Frederick A. Dix 244,007 7.4%
and Margorie Dix
209 Watson Road
N. Syracuse, NY 13212
<PAGE>
EXECUTIVE COMPENSATION AND OTHER MATTERS
Executive Compensation
The following table sets forth the annual and long-term compensation
of the Company's Chief Executive Officer for services to the Company during
the three fiscal years ended September 30, 1998.
Annual Compensation
Salary Bonus
Name and Principal Position Year $ $
Carl F. Fahrenkrug, 1998 110,966 -
President and CEO 1997 117,882 -
1996 104,229 10,000
Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee was or is an officer or
employee of the Company or any of its subsidiaries.
Compliance with Section 16(a) of the Securities Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's Executive Officers and 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 of ownership with the Securities and Exchange Commission
and the National Association of Securities Dealers, Inc. Such Officers,
Directors and 10% shareholders are also required by SEC Rules to furnish the
Company with copies of all Section 16(a) forms that they file. Based solely on
its review of copies of such reports received by it, the Company believes that
during the fiscal year ended September 30, 1998, all such filing requirements
were complied with in a timely fashion.
<PAGE>
PROPOSAL ONE
ELECTION OF DIRECTORS
Nominees
Three Directors (Class III) are to be elected at the Annual Meeting.
Unless otherwise instructed, the proxy holders will vote the proxies received
by them for the three nominees named below, all of whom are presently
Directors of the Company. In the event that any nominee is unable or declines
to serve as a Director at the time of the Annual Meeting, the proxies will be
voted for any nominee who shall be designated by the present Board of
Directors to fill the vacancy. A term of office for each person elected as a
Director will continue to the Annual Meeting of Shareholders at which their
term expires or until his or her successor has been elected and qualified. It
is not expected that any nominee will be unable or will decline to serve as a
Director.
The name of and certain information regarding each nominee is set
forth below.
Director Principal Occupation
CARL F. FAHRENKRUG Mr. Fahrenkrug was appointed President and Chief
Age 56 Executive Officer of MFC on October 7, 1992. He
Director since 1984 has also served as President and Chief Executive
Officer of NSI since prior to 1986. He served as
Vice President of Engineering at Microwave Systems,
Inc., Syracuse, N.Y. from 1972 - 1976. Mr. Fahrenkrug
has a B.S. and M.S. in Engineering and a MBA from
Syracuse University.
DANIEL GALBALLY Mr. Galbally is an accountant for Auburn Steel
Age 51 Company, Inc. in Auburn, N.Y. Prior to joining
Director since 1995 Auburn Steel, he was the controller of Diamond
Card Exchange, Inc. in Syracuse, N.Y. He was the
Controller of Evaporated Metal Films (EMF) in
Ithaca, N.Y. Before joining EMF, he worked as
Controller and acting vice president of finance at
Philips Display Components Co. He has a B.S.
degree in accounting and a MBA from Syracuse University.
FRANK S. MARKOVICH Mr. Markovich is a consultant in the manufacturing
Age 53 operations and training field. Prior to that, he was the
Director since 1992 Director of the Manufacturing Extension Partnership
at UNIPEG Binghamton. He held various high level
positions in operations, quality and product management
in a 20 year career with BF Goodrich Aerospace,
Simmonds Precision Engine Systems of Norwich, N.Y.
He completed US Navy Electronics and Communications
Schools and received a MBA from Syracuse University.
<PAGE>
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
On the recommendation of the Audit and Finance Committee, the Board of
Directors has appointed PricewaterhouseCoopers LLP, independent certified
public accountants, to audit the Company's financial statements for the fiscal
year ending September 30, 1999 and recommends that shareholders vote for
ratification of such appointment.
PricewaterhouseCoopers has audited the Company's financial statements
since the fiscal year ended September 30, 1992. A representative is expected
to be present at the Annual Meeting, will have an opportunity to make a
statement if they desire to do so and are expected to be available to respond
to appropriate questions.
The Board of Directors unanimously recommends a vote "FOR" the
ratification of the appointment of PricewaterhouseCoopers LLP as independent
auditors.
Other Matters
The Company knows of no other matters to be submitted at the meeting.
If any other matters properly come before the meeting, it is the intention of
the persons named in the enclosed proxy to vote the shares they represent as
the Board of Directors may recommend.
THE BOARD OF DIRECTORS
Dated: March 19, 1999
