<PAGE>
[SI TECHNOLOGIES LOGO]
December 8, 2000
Dear Shareholder:
You are cordially invited to attend the annual shareholders meeting of SI
Technologies, Inc. which will be held at the corporate office 14192 Franklin
Avenue, Tustin, California, on January 23, 2001, at 2:00 p.m. I look forward to
greeting as many of our shareholders as possible.
Details of the business to be conducted at the annual meeting are given in the
attached Notice of Annual Meeting and Proxy statement.
Whether or not you attend the annual meeting it is important that your shares be
represented and voted at the meeting. Therefore, I urge you to sign, date, and
promptly return the enclosed proxy.
On behalf of the Board of Directors, I would like to express our appreciation
for your continued interest in the affairs of the Company.
Sincerely,
Rick A. Beets
President & CEO
<PAGE>
[SI TECHNOLOGIES LOGO]
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 23, 2001
To the shareholders of SI TECHNOLOGIES, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of SI
Technologies, Inc. (the "Company"), a Delaware corporation, will be held on
Tuesday, January 23, 2001, at 2:00 p.m. local time, at 14192 Franklin Avenue,
Tustin, California for the following purposes:
1. To elect a board of seven directors.
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Shareholders of record at the close of business on December 8, 2000 will be
entitled to a vote at the annual meeting and at any adjournment thereof.
By Order of the Board of Directors
Rick A. Beets
President, CEO, CFO and Director
Tustin, California
December 8, 2000
================================================================================
YOUR VOTE IS IMPORTANT
Whether or not you expect to attend in person, we urge you to sign, date, and
return the enclosed Proxy at your earliest convenience. This will ensure the
presence of a quorum at the meeting. PROMPTLY SIGNING, DATING, AND RETURNING THE
PROXY WILL SAVE THE COMPANY THE EXPENSE AND EXTRA WORK OF ADDITIONAL
SOLICITATION. Sending in your Proxy will not prevent you from voting your stock
at the meeting if you desire to do so, as your Proxy is revocable at your
option.
================================================================================
Page 1 of 7
<PAGE>
[SI TECHNOLOGIES LOGO]
14192 FRANKLIN AVENUE
TUSTIN, CALIFORNIA 92780
714-505-6483
PROXY STATEMENT
SOLICITATION OF PROXIES
The Board of Directors of SI Technologies, Inc. (the "Company"), is soliciting
the enclosed proxy for use at the Annual Meeting of Shareholders of the Company
to be held on Tuesday, January 23, 2001, at 2:00 p.m. local time, at 14192
Franklin Avenue, Tustin, California. Whether or not you plan to attend the
meeting, you are requested to date, sign and return the proxy to the Company as
promptly as possible. The shares represented by proxies will be voted in
accordance with the Board of Directors' recommendations unless the proxy
indicates otherwise. Any shareholders giving a proxy may revoke it at any time
prior to its use by filing with the Secretary of the Company a written
revocation of a proxy bearing a later date, or by voting in person at the
meeting. The costs of the solicitation will be paid by the Company. In addition
to the solicitation of proxies by the use of the mail, directors, officers and
employees of the company may solicit proxies personally, or by other appropriate
means. The Company may also request banks, brokerage houses, and other
custodians, nominees or fiduciaries holding stock in their names for others, to
send proxy materials and to obtain proxies from their principals, and the
Company will reimburse them for their expenses in doing so.
The approximate date on which this proxy statement and the form of proxy is
first being sent or given to the shareholders is December 8, 2000.
The Company's Annual Report for the fiscal year ended July 31, 2000 (the "Annual
Report"), is being mailed concurrently with this proxy statement. Brokerage
houses, custodians, nominees, and others may obtain additional copies of the
Annual Report or this proxy statement by request to the Company.
VOTING RIGHTS
As of December 8, 2000, there were 3,547,123 shares of the Company's common
stock outstanding. The Company has only one class of equity security
outstanding. Each share is entitled to one vote. The Board of Directors has set
the close of business on December 8, 2000, as the record date for determining
those shareholders entitled to vote at the annual meeting.
Each share of the Company's Common Stock outstanding on the record date is
entitled to one vote per share at the 2000 annual meeting of stockholders. Under
Delaware law and the Company's certificate of incorporation, if a quorum is
present at the meeting, the seven (7) nominees for election as directors who
receive the greatest number of votes cast for the election of directors at the
meeting by the shares present in person or represented by proxy at the meeting
and entitled to vote shall be elected directors. In the election of directors,
any action other than a vote for a nominee will have the practical effect of
voting against the nominee. Abstention from voting will have the practical
effect of voting against any other matter submitted to a vote at the meeting
since it is one less vote for approval. Broker nonvotes on one or more matters
will have no impact on such matters since they are not considered "shares
present" for voting purposes.
Page 2 of 7
<PAGE>
PRINCIPAL HOLDERS OF VOTING SECURITIES
As of the close of business on November 24, 2000, there were 3,547,123 shares of
common stock of the Company outstanding. The following table sets forth certain
information regarding the Company's common stock beneficially owned on November
24, 2000 by (i) each person who is known by the Company to own beneficially more
than 5% of the Company's common stock, (ii) each director, (iii) each named
executive officer, and (iv) all directors and executive officers as a group:
<TABLE>
<CAPTION>
Number of Shares of Percent of
Common Stock Beneficial
Name and Address of Beneficial Owner Beneficially Owned(1) Ownership
------------------------------------ --------------------- ----------
<S> <C> <C>
RALPH E. CRUMP(2) 438,124(3) (4) 11.1%
Chairman of the Board, Treasurer, Director
RICK A. BEETS(2) 466,384(5) 11.8%
President, CEO, CFO & Director
EDWARD A. ALKIRE(2) 331,600(3) (6) 8.4%
Secretary, Director
S. SCOTT CRUMP(2),(7) 251,624(3) (8) 6.4%
Director
D. DEAN SPATZ(2) 122,500(3) (9) 3.1%
Director
HEINZ ZWEIPFENNIG(2) 106,000(3) 2.7%
Director
ALL DIRECTORS AND OFFICERS AS A GROUP (6 PERSONS) 1,716,232(2) (3) (4) (5) 43.3%
(6) (7) (8) (9)
THE CUTTYHUNK FUND LIMITED 446,960(10) 11.3%
THE ANEGADA FUND LIMITED 160,040(10) 4.0%
</TABLE>
(1) Information with respect to beneficial ownership is based upon the
Company's stock records and data supplied to the Company by the holders.
Subject to applicable community property and similar statutes, and except
as otherwise indicated, the persons listed as beneficial owners of the
shares have sole voting and investment power with respect to such shares.
(2) The address of each executive officer and director is c/o SI Technologies,
Inc., 14192 Franklin Avenue, Tustin, CA 92780.
(3) Includes 31,000 shares subject to currently exercisable options.
(4) Includes 203,562 shares held of record by Mr. Ralph Crump's wife, Marjorie
L. Crump. Mr. Ralph Crump has shared voting and investment power with
respect to such shares.
(5) Includes 126,800 shares subject to currently exercisable options. Does not
include 57,700 unvested option shares granted in 1998, 1999 and 2000.
(6) Includes 2,000 shares held of record by Mr. Alkire's children for whom he
acts as custodian. (7) S. Scott Crump is the son of Ralph E. Crump.
(8) Includes 109,562 shares held of record by Mr. S. Scott Crump's wife, Lisa
Crump. Mr. S. Scott Crump has shared voting and investment power with
respect to such shares.
(9) Includes 750 shares held of record by Mr. Spatz's wife, Ruth Carol Spatz.
Mr. Spatz has shared voting and investment power with respect to such
shares.
(10) J. Carlo Cannell, dba Cannell Capital Management is the investment advisor
to The Cuttyhunk Fund Limited and The Anegada Fund Limited, and shares
voting and investment control over the shares held by these funds.
Page 3 of 7
<PAGE>
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The Directors and Executive Officers of the Company are as follows:
<TABLE>
<CAPTION>
NAME AGE POSITION
<S> <C> <C>
Edward A. Alkire 47 Secretary, Director
Rick A. Beets 47 President, CEO, CFO & Director
Ralph E. Crump 77 Chairman of the Board, Treasurer,
Director
S. Scott Crump 47 Director
D. Dean Spatz 56 Director
Heinz Zweipfennig 67 Director
Bryant Riley 34 Director - nominee
</TABLE>
CERTAIN INFORMATION CONCERNING EXECUTIVE OFFICERS AND NOMINEES FOR DIRECTORS
EDWARD A. ALKIRE - Director since 1990, Chief Operating and Financial Officer
from 1989 to 1993. Mr. Alkire is currently employed at Holman & Associates,
Inc., P.S., a certified public accounting firm. Prior to joining SI
Technologies, Inc. in 1989, Mr. Alkire was a Senior Manager at Touche Ross &
Co., a certified public accounting firm, where he provided business and tax
consulting services to closely-held and emerging businesses. Mr. Alkire is a
Certified Public Accountant and is a graduate of Evergreen State College.
RICK A. BEETS - Chief Executive Officer since August 1993, President since
December 1993, a Director since October 1997, interim Chief Financial Officer
since April 2000. Prior to joining SI, Mr. Beets served as a Division Manager
for the Machinery and Equipment Group of Chicago-based FMC Corporation from
1988-1993. Prior to FMC (from 1977-1988), he worked with Colt Industries, Inc.,
in a number of increasingly responsible positions with the Fairbanks Morse Pump
Division and the company's France Compressor Products Division. Mr. Beets holds
a BS degree in Industrial Management and a MA degree in Business Administration.
RALPH E. CRUMP - Director since 1981, Treasurer since 1983, and Chairman of the
Board since November 1988. Mr. Crump is President of Crump Industrial Group, an
investment firm located in Trumbull, Connecticut. Mr. Crump is also a co-founder
and director of Osmonics, Inc. (NYSE), Stratasys, Inc. (NASDAQ), Imtec, Inc.
(NASDAQ) and Mity-Lite, Inc. (NASDAQ) and ex-chairman of Med-Chem Products,
Inc., (AMEX), and Ivy Medical, Inc. (formerly NASDAQ). Prior to November 1986,
Mr. Crump was Chairman, President, and Director of Frigitronics, Inc., a
manufacturer of eye care products, which he co-founded in 1962. Frigitronics'
common stock was listed on the New York Stock Exchange until its acquisition by
Revlon in November, 1986. Mr. Crump is a Trustee of the Alumni Foundation of the
University of California at Los Angeles and a member of the Board of Overseers
for the Thayer Engineering School at Dartmouth College.
S. SCOTT CRUMP - Director since 1981. Mr. Crump joined the Company as its Vice
President-Marketing and was an Executive Vice President until June 1988. He is
the Chairman and President of Stratasys Inc., (NASDAQ), a manufacturer of
equipment for the product design industry using prototyping technology. From
1988 until 1989 he was Chief Operating Officer of Ivy Medical, Inc., (formerly
Page 4 of 7
<PAGE>
NASDAQ) a manufacturer of equipment for the health care industry. He holds a BS
in Mechanical Engineering and is a registered professional engineer.
D. DEAN SPATZ - Director since 1983. Mr. Spatz is the Chairman and President of
Osmonics, Inc. (NYSE), which designs, develops, manufactures and markets
membrane systems for use in water purification and waste treatment equipment.
Mr. Spatz is also a director of Signa Aldrich Corp. (NASDAQ). He holds a B.A.
from Dartmouth College and a Master of Engineering degree from the Thayer School
of Engineering, Dartmouth College.
HEINZ ZWEIPFENNIG - Director since 1979. Mr. Zweipfennig served, from 1984 until
his retirement, as President of Zweipfennig Management Consultants, an
international consulting company. He also served as a member of the board of
directors of the Software Management Services Corporation. From 1979 to 1984, he
was co-founder and director of Scientific Data Systems, Inc., a Los Angeles,
California based computer systems manufacturing company. Prior to 1979, he held
senior management positions with Perkin-Elmer, Macro Data and Xerox Corporation.
BRYANT RILEY - Nominated by the Board of Directors in November 2000. Mr. Riley
is the Founder, Chairman & CEO of B. Riley & Company, LLC, a Los Angeles based
regional brokerage firm. Prior to B. Riley & Company Mr. Riley held a variety of
research, trading and sales positions with Dabney Resnick, Inc., Beverly Hills,
CA, Gaines Berland, Inc, New York, NY, and Huberman & Riley, Inc., Dallas, TX.
Mr. Riley holds a B.S. in finance from Lehigh University.
PROPOSAL 1 --- ELECTION OF DIRECTORS
At the Annual Meeting seven directors, constituting the entire Board of
Directors, are to be elected to hold office until the next Annual Meeting and
until their successors are duly elected and qualified. Messrs. R. Crump, E.
Alkire, R. Beets, S. Crump, D. Spatz, and H. Zweipfennig are the current
directors of the company and have been nominated to continue as directors.
Additionally, the board has nominated Mr. Bryant Riley to be appointed a
director subject to shareholder vote. Unless otherwise directed, the proxy
holders will vote all proxies with a view toward the election of these nominees.
If, due to circumstances not at present foreseen, any of such nominees shall not
be available for election, the proxy will be voted for such other person or
persons as the Board of Directors may recommend.
COMMITTEES AND COMPENSATION OF THE BOARD OF DIRECTORS
During the last fiscal year of the Company, the Board of Directors had four
meetings. Except for an audit committee and the committee for the administration
of the 1994 Stock Option Plan, the Board of Directors has no compensation,
nominating or other committee to carry out all or part of its management
functions. The members of the audit committee are Messrs. Ralph E. Crump, D.
Dean Spatz, and Ed Alkire.
During fiscal year 2000, each director attended 100 percent of the aggregate
number of meetings of the Board of Directors and the committees on which each
Director serves. During fiscal year 2000 one meeting was held by the Audit
Committee. Members of the Board do not receive cash compensation for their
service on the Company's Board of Directors or any committee thereof but are
reimbursed for business expenses incurred in attending meetings.
Page 5 of 7
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information with respect to compensation paid or
accrued during the years ended July 31, 2000, 1999 and 1998 for the Chief
Executive Officer and each other named executive receiving compensation over
$100,000 in the most recent fiscal year.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------- ----------------------
Awards
------
Options
Name & Principal Position Fiscal Year Annual Salary Bonus (Shares)
-------------------------- ----------- -------------- ----- --------
<S> <C> <C> <C> <C>
Rick A. Beets 2000 $205,000 $ - 7,500(1)
President & CEO, 1999 $180,000 $ 18,000 20,000(2)
Director 1998 $150,000 $150,000 57,000(3)
</TABLE>
(1) Consists of an option to acquire 7,500 shares at an exercise price of
$2.375 issued under the Company's 1994 Stock Option
(2) Consists of an option to acquire 20,000 shares at an exercise price of
$2.25 issued under the Company's 1994 Stock Option Plan.
(3) Consists of an option to acquire 50,000 shares at an exercise price of
$4.625 and an option to acquire 7,000 shares at an exercise price of $4.125
issued under the Company's 1994 Stock Option Plan.
The following table sets forth information about stock option grants during
2000.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Percentage of Potential Realized Value
Total Options at Assumed Annual Rates
Granted to of Stock Price
Options Employees in Exercise Expiration Appreciation for Option
Name Granted 2000 Price Date(1) Term(2)
---- ------- ---- ----- ------- ------
5% 10%
-- ---
<S> <C> <C> <C> <C> <C> <C>
Rick A. Beets 7,500 60.0% $2.375 1/20/10 $11,202 $30,698
</TABLE>
(1) The options were granted for a term of ten years. The options vest over
five years from the date of grant.
(2) Potential values stated are the result of using the Securities and Exchange
Commission method of calculations of 5% and 10% appreciation in value from
the date of grant to the end of the option term. Such assumed rates of
appreciation and potential realizable values are not necessarily indicative
of the appreciation, if any, which may be realized in future periods.
The following table shows information concerning the number and value of
unexercised options held by Mr. Beets at the end of fiscal 2000.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR END OPTION VALUES(1)
<TABLE>
<CAPTION>
Number of Securities Underlying Value of Unexercised in-the-money
Unexercised Options at FY-End Options at FY-End
Name Exercisable/unexercisable(1) Exercisable/unexercisable
---- ---------------------------- -------------------------
<S> <C> <C>
Rick A. Beets 126,800/57,70 0 $88,552/$3,481(2)
</TABLE>
(1) No options were exercised by Mr. Beets during fiscal year 2000.
(2) The values shown equal the difference between the exercise price of
unexercised in-the-money options and the closing price of the underlying
common stock at July 31, 2000. Options are in-the-money if the fair market
value of the Common Stock exceeds the exercise price of the options.
Page 6 of 7
<PAGE>
DESCRIPTION OF THE COMPANY'S STOCK OPTION PLANS
The Company has options outstanding under two Stock Option Plans, the amended
and restated 1984-85 Stock Option Plan and the 1994 Stock Option Plan (the "1994
Plan"). The 1984-1985 Plan has expired and no further options may be granted
under that plan. The 1994 Plan provides for the grant of statutory stock options
and non-qualified stock options to purchase an aggregate of 600,000 shares of
common stock. The Plan is administered by two or more members of the board of
directors. Statutory options may not be granted at an exercise price less than
fair market value of the common stock on the date of grant. Unless otherwise
specified, the options granted under the 1994 Plan expire up to ten years from
the date of grant. Generally, if an optionee ceases to be an employee or
director for any reason other than death or disability, the option expires 90
days after the date of termination.
COMPLIANCE WITH SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors, executive officers and persons who own more than ten percent (10%) of
a registered class of the Company's equity securities to file with the
Securities and Exchange Commission initial reports of ownership and reports of
changes in ownership of common stock and other equity securities of the Company.
Officers, directors, and greater than ten percent (10%) shareholders are
required by SEC regulation to furnish the Company with copies of all section
16(a) reports.
To the Company's knowledge, based solely on review of such reports furnished to
the Company, during the fiscal year ended July 31, 1999, all Section 16(a)
filing requirements applicable to its officers, directors and persons who own
more than 10% of a registered class of the Company's equity where filed on a
timely basis.
SHAREHOLDER PROPOSAL
Proposals of shareholders to be presented at the 2001 Annual Meeting of
Shareholders must be received by the Company at its principal executive offices,
no later than August 26, 2001, in order to be included in the proxy statement
and form of proxy relating to that meeting.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB, AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, WILL BE FURNISHED WITHOUT CHARGE TO ANY
SHAREHOLDER UPON WRITTEN REQUEST TO THE PRESIDENT OF SI TECHNOLOGIES, INC.,
14192 FRANKLIN AVENUE, TUSTIN, CALIFORNIA 92780, ATTN: RICK A. BEETS, PRESIDENT
& CEO.
OTHER BUSINESS
The Board of Directors knows of no business that will be presented for
consideration at the annual meeting other than as stated in the Notice of Annual
Meeting. If, however, other matters are properly brought before the meeting,
shares represented by proxies will be voted in accordance with the best judgment
of the proxy holders or their substitutes.
Page 7 of 7
<PAGE>
SI TECHNOLOGIES, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD of
Directors for the Annual Meeting of Shareholders to be
held on January 23, 2001. The undersigned hereby
constitutes and appoints Rick A. Beets and Ralph E.
Crump and each of them, with full power of substitution,
attorneys and proxies of the undersigned, to represent
the undersigned and vote as if personally present at the
Annual Meeting of Shareholders to be held at 14192
Franklin Avenue, Tustin, California at 2:00p.m. local
time and at any adjournment thereof, in the following
manner:
1. ELECTION OF DIRECTORS: MANAGEMENT NOMINATES THE FOLLOWING DIRECTORS
Edward A. Alkire Rick A. Beets Ralph E. Crump
S. Scott Crump D. Dean Spatz HeinzZweipfennig
Bryant Riley
/ / FOR all nominees listed above (except as marked contrary below)
/ / WITHHOLD AUTHORITY to vote for all nominees listed above
/ / ABSTAIN
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
-------------------------- -------------------------
------------------------- -------------------------
-------------------------- -------------------------
-------------------------
2. IN ACCORDANCE WITH THEIR BEST JUDGMENT WITH RESPECT TO ANY OTHER MATTERS
WHICH MAY PROPERLY COME BEFORE THIS MEETING.
When this proxy is properly executed and returned, shares it represents will be
voted at the meeting in accordance with the choices specified above.
If no choices are specified, this proxy will be voted for the nominees and
proposals set forth herein and in accordance with the best judgment of the
designated individuals with respect to any other matters which may properly come
before the meeting.
Please date and sign exactly as your name or names appear below. If more than
one owner, all should sign. When signing as attorney executor, administrator,
trustee or guardian, give your full name and title as such. If the signatory is
a corporation or partnership, sign the full corporate or partnership name by a
duly authorized officer or partner.
DATED:_________________________________________
Signature:________________________________________
Signature:________________________________________
PLEASE COMPLETE, SIGN AND RETURN THIS PROXY PROMPTLY.
