VICON FIBER OPTICS CORP.
90 Secor Lane
Pelham Manor, New York 10803
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
To be held on
Tuesday, June 2, 1998
April 30, 1998
Notice is hereby given that the Annual Meeting of Shareholders of Vicon
Fiber Optics Corp., (the "Company"), will be held at the Ramada Plaza
Hotel, One Ramada Plaza, New Rochelle, New York 10801, on Tuesday, June 2,
1998. The meeting will commence at 11:00 a.m. and will be held for the
following purposes:
1. To elect eight directors for the ensuing year;
2. To ratify the appointment of auditors to examine the Company's
accounts for the year 1998;
3. To act upon such other matters as may properly come before the
meeting.
Holders of common shares of record at the close of business on April 30,
1998 will be entitled to vote with respect to this solicitation.
You are cordially invited to attend the meeting.
By Order of the Board of Directors,
Les Wasser
Secretary
<PAGE>
VICON FIBER OPTICS CORP.
90 Secor Lane
Pelham Manor, New York 10803
April 30, 1998
PROXY STATEMENT
This proxy is solicited by the Board of Directors of Vicon Fiber Optics
Corp. (the "Company") for use at the Annual Meeting of Shareholders to be
held on Tuesday, June 2, 1998, and at any adjournment or adjournments
thereof. This proxy statement and the accompanying proxy card are first
being mailed to Stockholders on or about May 5, 1998.
The Board of Directors has fixed the close of business on April 30, 1998 as
the record date for the determination of Stockholders entitled to notice of
and to vote at the Annual Meeting. As of such date, there were issued and
outstanding 8,515,770 shares of Common Stock, each of which is entitled to
one vote. The presence, in person or by properly executed proxy of the
holders of a majority of the outstanding shares of Common Stock entitled to
vote is necessary to constitute a quorum for the transaction of business at
the Annual Meeting.
The accompanying proxy provides space for a Stockholder to abstain from
voting for any or all nominees for the Board of Directors and to abstain
from voting on any proposal if he or she chooses to do so. Directors are
elected by a plurality of the votes cast and the ratification of the
appointment of auditors requires the approval of a majority of the votes
cast at the meeting. Abstentions (votes withheld) in connection with the
election of one or more nominees for director will not be counted as votes
cast for or against such nominees, and abstentions and "broker non-votes"
will not be counted in determining the number of votes cast in connection
with the ratification of the appointment of auditors.
A proxy may be revoked by a Stockholder at any time before it is voted at
the Annual Meeting by (1) giving notice in writing of such revocation to
the Secretary of the Corporation, (2) submitting another proxy bearing a
later date, or (3) voting in person at the Annual Meeting. Unless so
revoked, the shares represented by a properly signed proxy will be voted at
the Annual Meeting as specified by the Stockholder. If a proxy is properly
signed and returned and no specification is made, the shares represented
thereby will be voted FOR: (1) the election of all nominees for director
(Proposal 1); (2) FOR the ratification of the appointment of auditors
(Proposal 2).
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
General Information
Unless authority to vote is withheld, it is the intention of the persons
named in the enclosed form of proxy to vote shares covered by valid proxies
in favor of the election of the eight persons named below. All of the
directors will, if elected, hold office until the next Annual Meeting of
Stockholders and until their successors are elected and qualified. All of
the nominees have indicated a willingness to serve as directors, but if any
nominee becomes unable or unwilling to serve prior to the Annual Meeting,
which is not anticipated, the persons named in the proxy will vote for the
election of a replacement as recommended by the Board of Directors. The By-
Laws of the Company, which provided for a maximum of seven members on the
Board of Directors, were amended by the Board at a special meeting on April
7, 1998, increasing the number to eight. Further, the By-Laws provide for
the filing of vacancies or any newly created directorships by the Directors
then in office.
The Board of Directors recommends a vote "FOR" the Nominees below.
NOMINEES FOR ELECTION AS DIRECTORS
Leonard Scrivo, Age 60: Chairman, Chief Executive Officer and President of
the Company for more than the last five years. Has a Bachelor of Science
degree from City College of NY. Studied Optical Engineering at the
University of Rochester. Mr. Scrivo has over 30 years experience in
executive management, design and marketing of fiber optic products. He
also holds seven patents pertaining to fiber optics. He has been a
consultant to the American Society for Gastro-intestinal Endoscopy
committee for new instruments
Les Wasser, Age 54: Director, Secretary and Controller of the Company for
more than the last five years. Bachelors and M.B.A. in Accounting and
Taxation, Certified Public Accountant.
Michael Scrivo, Age 32: Director, Vice-President Operations. Elected to the
Board on April 23, 1998, at a special meeting of the Board of Directors, to
fill the vacancy created by the resignation of Stanley Youdelman. Employed
by the Company since 1988. He has a Bachelor of Science in Economics and a
Masters Degree in Industrial Management.
Allan Borkowski, Age 57: Director. Elected to the Board at a special
meeting of the Board of Directors on April 23, 1998. Business and
financial consultant for more than the past five years. Principal
stockholder and President of ASB Consultants, Inc. a privately held
business consulting firm. Since June, 1982 he has been Chairman and Chief
Executive Officer of Optivest Technologies Corp., a privately held business
development company. Formerly, Chairman of the Board of Selvac Corp.
through June 1996 and Director of Mehl/ Biophile International Corp. until
February 1997.
Robert J. Figliozzi, Age 60: Director. Elected to the Board at a special
meeting of the Board of Directors on April 23, 1998. Executive Vice
President of Mehl/ Biophile International Corp. since April 1997. August
1994 to April 1997, Vice President of World Fuel Corporation, an aviation
and fueling services corporation listed on the New York Stock Exchange.
Prior thereto he was Senior Managing Director and Director of Research of
Stamford Securities Corporation, a brokerage firm and member of the New
York Stock Exchange.
Michael J. Funke, Age 54: Director, Elected to the Board at a special
meeting of the Board of Directors on April 23, 1998. Editor/Publisher of
the MJF/Ruta Financial Newsletter. Private investment consultant and
financial advisor since 1992. Consultant to the Company since July 1996.
Employed 1967-1992 by IBM in numerous management and consulting positions.
MBA from The Wharton School.
Thomas E. Furey, Jr. Age 57 . Director, Elected to the Board at a special
meeting of the Board of Directors on April 23, 1998. Employed by IBM since
1963. Presently worldwide general manager for technology development,
architecture and implementation for the Olympic Games. Prior to this
position he was general manager of IBM's Worldwide Network Computing
Solutions Unit and has been a leader in the development of IBM's most
advanced hardware and software systems.
Kenneth Zimmerman, Age 47. Director, Elected to the Board at a special
meeting of the Board of Directors on April 23, 1998. Founder and Chief
Executive Officer, President and sole stockholder of Kenar Enterprises,
Ltd., a privately held women's apparel manufacturer and retailer for the
past twenty-one years. Director of Chic by H.I.S., Inc. listed on the New
York Stock Exchange.
Committees of the Board of Directors
The Board has established committees including the Audit Committee,
Compensation and Stock Option Committee, Executive Committee and
Acquisition Committee. The duties of the Compensation and Stock Option
Committees are described below in the Report of the Compensation and Stock
Option Committees. The Audit Committee recommends the appointment of the
independent auditors, reviews the annual financial statements of the
Corporation and reviews the scope and performance of the audit service
provided by the independent auditors. The Acquisition Committee has been
formed to seek out and review possible merger or acquisition situations
that would be beneficial to the Company. There were three committee
meetings held during 1997.
All directors in office during 1997 attended all of the meetings of the
Board and committees in that year.
<PAGE>
COMPENSATION OF DIRECTORS
The Board of Directors has the responsibility for establishing broad
corporate policies and for overseeing the overall performance of the
Company. The Corporation believes it must develop plans and programs which
seek to enhance the profitability of the Corporation and increase
shareholder value by closely aligning the financial interest of the
Corporation's directors with those of the Corporation and its Stockholders.
Accordingly, the Board has adopted a program to attract new Directors who
can achieve these goals and has issued warrants to newly elected Directors.
Each new Director elected to the Board on April 23, 1998, at a meeting of
the Board of Directors, in accordance with the by-laws of the Company has
been issued warrants to purchase 250,000 shares of Common Stock at $1.00
per share. 100,000 of these warrants vest and are exercisable in the first
year and the balance over a period of three years, subject to each Director
remaining on the Board, and expire in five years.
EXECUTIVE COMPENSATION
Report of Compensation and Stock Option Committee
Regarding Executive Compensation
The Company's compensation programs are designed to provide executives with
competitive earnings opportunity, by linking to the short-term and long-
term performance of the Company and the sustained performance of the
individual. Accordingly, the Company sets annual base salaries for these
individuals below what it believes to be competitive levels, and uses
longer term incentive compensation to reward officers and key employees for
improving the Company' profitability and shareholder value.
The Compensation and Stock Option Committees, comprised of three directors,
one of whom, the Chairman, is not an employee of the Corporation, reviews
and evaluates management's performance and makes recommendations on salary
increases and bonuses to the Board of Directors and administers the
Corporation's 1997 Incentive Stock Option Plan. Since, during 1997, the
entire Board of Directors served as standing Compensation and Stock Option
Committees, recommendations of the Committees are simultaneously adopted by
the Board of Directors.
The Board of Directors believes that its past compensation policies have
successfully focused the Company's management on long-term success and
increasing shareholder value.
<PAGE>
Summary Compensation Table
A. The following tables sets forth cash or other compensation received by
the Chief Executive Officer and the other most highly paid executive
officers of the Company whose compensation exceed $100,000 for each of the
last three fiscal years.
<TABLE>
<S> <C> <C> <C>
Annual Compensation Long-Term Compensation
Restricted
Stock
Name and Principal Position Year Total $ (1) Awards ($) Options (#)
Leonard Scrivo 1997 $101,481 0 0
President, C.E.O. 1996 92,944 $13,000 50,000
Chairmen of the Board (1) 1995 84,651 0 0
All Officers and Directors 1997 160,065 0 0
As a Group (1) 1996 150,958 21,000 130,000
(3 persons) 1995 133,161 0 0
</TABLE>
B. Options granted during the last fiscal year: None
C. Options exercised during the last fiscal year: None.
D. Fiscal year end option values:
<TABLE>
<S> <C> <C>
Value of
Unexercised in-
Unexercised the-money
Name Options (#) Options ($)
Leonard Scrivo 50,000 $14,500
All Officers and Directors
as a Group (3 persons) 130,000 $49,500
(1) See Certain Transactions for information on employment contracts.
CERTAIN TRANSACTIONS
In the last fiscal year there were no transactions between the Company and
any affiliates, including officers, directors or holders of more than 5% of
the outstanding common stock. On April 3, 1998, financial and management
consulting agreements were entered into with Allan Borkowski and Robert
Figliozzi, both of whom were subsequently elected to the Board of
<PAGE>
Directors. These agreements provide remuneration in the form of warrants
for the purchase of 150,000 shares of common stock at $1.00 per share each,
with 100,000 warrants exercisable in 1998 and 50,000 in 1999.
Employment contracts were entered into on April 7, 1998 between the Company
and certain senior executives. An employment contract was executed with
Leonard Scrivo, for a term of five years including a change of control
clause with severance conditions. Employment contracts were executed with
Les Wasser and Michael Scrivo for terms of three and five years,
respectively. Each of the agreements provides for compensation at their
current levels with annual minimum increases of 5% plus cost of living
adjustments.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The following table sets forth information concerning the beneficial
ownership of the Company's Common Stock for executive officers and each of
the nominees for Director and for each person known by the Company to be
the beneficial owner of more than 5% of the outstanding Common Stock as of
March 31, 1998.
</TABLE>
<TABLE>
<C> <C> <C>
Shares
Beneficially
Name Owned Percent
Leonard Scrivo 1,052,978 12.4
Les Wasser 165,000 1.9
Michael Scrivo (1) 170,000 2.0
Allan Borkowski (2)(3) 241,000 2.8
Robert Figliozzi (2) 0 0
Michael J. Funke (6) 30,100 0.4
Thomas E. Furey,Jr. (1) 20,000 0.2
Kenneth Zimmerman (1)(4) 66,200 0.7
Directors and Executive
Officers as a Group 1,745,278 20.4
Donald J. Unger (5) 980,000 11.5
Joseph Cooper 557,478 6.8
</TABLE>
(1) As of April 3, 1998, owns warrants exercisable in 1998 to purchase
100,000 shares of common stock.
<PAGE>
(2) As of April 3, 1998, owns warrants exercisable in 1998 to purchase
200,000 shares of common stock.
(3) Includes 80,000 shares owned by members of his family in which Mr.
Borkowski disclaims any beneficial interest.
(4) Includes 7,200 shares owned by members of his family in which Mr.
Zimmerman disclaims any beneficial interest.
(5) Includes 200,000 shares owned by members of his family in which Mr.
Unger disclaims any beneficial interest.
(6) As of April 3, 1998, owns warrants exercisable in 1998 to purchase
275,000 shares of common stock.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF AUDITORS
Subject to shareholder ratification, the Board of Directors has reappointed
the firm of Sheft Kahn & Company, LLP, as the independent auditors to
examine the Company's financial statements for the year 1998.
The firm of Sheft Kahn & Company, LLP has audited the Company's books
annually since 1991, has offices convenient to where the Company operates,
and is considered by the Board of Directors to be well qualified. If the
Stockholders do not ratify the appointment of Sheft Kahn & Company, LLP,
the appointment of other independent auditors will be considered by the
Board of Directors.
A representative of Sheft Kahn & Company, LLP will attend the Annual
Meeting and will have the opportunity to make a statement and be available
to respond to appropriate questions.
The Board of Directors recommends that Stockholders vote "FOR" this
proposal.
GENERAL
A proposal submitted by a shareholder for action at next year's Annual
Meeting of the Company must be received at the Company's principal
executive office in Pelham Manor, New York, no later than January 25, 1999
in order to be eligible for inclusion in the Company's proxy statement for
that meeting.
<PAGE>
The Board of Directors is not aware of any other matters to be brought
before the meeting, but in the event that other matters are presented, the
persons named in the Board proxy will vote upon such matters in their
discretion.
The Annual Report to Stockholders for fiscal year ended December 31, 1997
is also enclosed, but is not part of the proxy soliciting material.
The Company's Annual Report on Form 10-KSB of the Securities and Exchange
Commission (without exhibits) will be provided without charge to
stockholders upon written request to the Company at 90 Secor Lane, Pelham
Manor, New York 10803.
SOLICITATION OF PROXIES
The enclosed proxy is solicited by and on behalf of the Board of Directors
of the Company. The Company will bear all costs of distribution and
solicitation of proxies, including the preparation, printing and mailing of
the Notice of Annual Meeting of Shareholders, Proxy Statement, form of
proxy, Annual Report to Shareholders, and business reply envelopes. The
solicitation will be conducted principally by mail, although directors,
officers and regular employees of the Company (at no additional
compensation) may solicit proxies personally or by telephone or telefax.
Brokers, nominees, fiduciaries and other custodians will be reimbursed
their reasonable fees and expenses incurred in forwarding proxy materials
to beneficial owners.
By Order of the Board of Directors
Les Wasser
Secretary
