<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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
Section 240.14a-12
Arizona Instrument Corporation
_______________________________________________
(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), 14a-6(i)(1),
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>
ARIZONA INSTRUMENT CORPORATION
[LOGO]
4114 E. Wood Street
Phoenix, Arizona 85040
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
June 22, 1995
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders of Arizona Instrument
Corporation, a Delaware corporation (the "Company"), will be held
on Thursday, June 22, 1995 at 2:00 p.m. local time, at the
corporate offices of the Company, 4114 E. Wood Street, Phoenix,
Arizona, for the following purposes:
(1) To elect three directors to serve for the next three
years or until their successors are elected;
(2) To ratify the appointment of Deloitte & Touche LLP
as independent auditors of the Company for the fiscal year ending
December 31, 1995; and
(3) 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.
Only stockholders of record at the close of business on
May 10, 1995 are entitled to notice of and to vote at the Meeting.
All stockholders are cordially invited to attend the
Meeting in person.
Sincerely,
[signature]
Susan D. Berry
Secretary
Phoenix, Arizona
May 4, 1995
________________________________________________________________
Whether or not you expect to attend the Meeting, please
complete, date and sign the enclosed Proxy and mail it promptly in
the enclosed envelope to assure representation of your shares. No
postage need be affixed if mailed in the United States.
<PAGE>
ARIZONA INSTRUMENT CORPORATION
4114 E. Wood Street
Phoenix, Arizona 85040
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JUNE 22, 1995
_______________________________
SOLICITATION, EXECUTION AND REVOCATION OF PROXIES
Proxies in the accompanying form are solicited on behalf,
and at the direction, of the Board of Directors of Arizona
Instrument Corporation, a Delaware corporation (the "Company").
All shares represented by properly executed proxies, unless such
proxies have previously been revoked, will be voted in accordance
with the direction on the proxies. If no direction is indicated,
the shares will be voted in favor of the proposals to be acted upon
at the Annual Meeting. The Board of Directors is not aware of any
other matter which may come before the Annual Meeting. If any
other matters are properly presented at the meeting for action,
including a question of adjourning the Annual Meeting from time to
time, the persons named in the proxies and acting thereunder will
have discretion to vote on such matters in accordance with their
best judgment.
When stock is in the name of more than one person, the
proxy is valid if signed by any of such persons unless the Company
receives written notice to the contrary. If the stockholder is a
corporation, the proxy should be signed in the name of such
corporation by an executive or other authorized officer. If signed
as attorney, executor, administrator, trustee, guardian or in any
other representative capacity, the signer's full title should be
given and, if not previously furnished, a certificate or other
evidence of appointment should be furnished.
This Proxy Statement and the form of proxy which is
enclosed are being mailed to the Company's stockholders commencing
on or about May 17, 1995.
A stockholder executing and returning a proxy has the
power to revoke it at any time before it is voted. A stockholder
who wishes to revoke a proxy can do so by executing a later-dated
proxy relating to the same shares and delivering it to the
Secretary of the Company prior to the vote at the Annual Meeting,
by written notice of revocation received by the Secretary prior to
the vote at the Annual Meeting or by appearing in person at the
Annual Meeting, filing a written notice of revocation and voting in
person the shares to which the proxy relates.
In addition to the use of the mails, proxies may be
solicited by personal interview, telephone and telegram by the
directors, officers and regular employees of the Company. Such
persons will receive no additional compensation for such services.
Arrangements will also be made with certain brokerage firms and
certain other custodians, nominees and fiduciaries for the
forwarding of solicitation materials to the beneficial owners of
Common Stock held of record by such persons, and such brokers,
custodians, nominees and fiduciaries will be reimbursed for their
reasonable out-of-pocket expenses incurred in connection therewith.
All expenses incurred in connection with this solicitation will be
borne by the Company.
The mailing address of the principal corporate office of
the Company is 4114 E. Wood Street, Phoenix, Arizona 85040.
<PAGE>
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Only stockholders of record at the close of business on
May 10, 1995 (the "Record Date") will be entitled to vote at the
meeting. On the Record Date, there were issued and outstanding
6,150,663 shares of Common Stock. Each holder of Common Stock is
entitled to one vote, exercisable in person or by proxy, for each
share of the Company's Common Stock held of record on the Record
Date. The presence of a majority of the shares of Common Stock
entitled to vote, in person or by proxy, is required to constitute
a quorum for the conduct of business at the Annual Meeting. The
affirmative vote of a majority of such quorum is required with
respect to the election of directors and the approval of Proposal
2. Abstentions and broker non-votes are each included in the
determination of the number of shares present for quorum purposes.
Abstentions are counted in tabulations of the votes cast on
proposals presented to stockholders, whereas broker non-votes are
not counted for purposes of determining whether a proposal has been
approved.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of April 17, 1995 the following table sets forth the
beneficial ownership of Common Stock of the Company by each
director and director nominee who owns shares, by each executive
officer named in the Summary Compensation Table set forth herein,
by all directors and executive officers as a group, and by each
person known by the Company to be the beneficial owner of more than
5% of the Company's Common Stock:
Shares of Common
Stock Beneficially
Owned
Number Percent
Name and Address (1) of Shares of Total
Walfred R. Raisanen 155,000 2.5%
S. Thomas Emerson (2) 30,000 (3)
John P. Hudnall (2) 63,521 1.0%
Quinn Johnson 315,001 5.0%
Richard Long (2) 31,000 (3)
R. J. McCrory (2) 7,500 (3)
Patricia Onderdonk (2) 10,000 (3)
Stanley Weiss (2) 25,000 (3)
Bridge Capital
Investors II (4) 837,298 11.8%
Glenpointe Centre West
Teaneck, New Jersey 07666
All directors and executive
officers as a group (2) (5)
(11 persons) 655,218 10.5%
__________________
<PAGE>
(1) Unless otherwise indicated, the beneficial owner's address is
4114 East Wood Street, Phoenix, Arizona 85040.
(2) Includes shares issuable upon exercise of options which are
currently exercisable or become exercisable within 60 days of
April 17, 1995 as applicable for each of the following
individuals:
Long 19,000 shares
Hudnall 60,000 shares
Emerson 10,000 shares
McCrory 7,500 shares
Onderdonk 7,500 shares
Weiss 5,000 shares
(3) Less than one percent.
(4) None of these shares are currently issued; 787,298 of the
shares may be issued upon conversion of an outstanding note
and up to 50,000 shares may be issued upon exercise of a
warrant. See "Certain Transactions."
(5) Includes 18,196 shares issuable upon exercise of options (in
addition to shares issuable upon exercise of options indicated
in note 2).
PROPOSAL 1
ELECTION OF DIRECTORS
NOMINEES
The Board of Directors currently consists of eight
members and is classified into three classes with each class
holding office for a three-year period. The terms of Mr. Long, Ms.
Onderdonk, and Mr. Weiss expire in 1995; the terms of Mr. Johnson
and Mr. Emerson expire in 1996; and the terms of Mr. Hudnall, Mr.
Raisanen and Mr. McCrory expire in 1997.
The Certificate of Incorporation restricts the removal of
directors under certain circumstances. The number of directors may
be increased to a maximum of 10.
Three directors, Messrs. Long and Weiss and Ms.
Onderdonk, are to be re-elected at the Meeting for a three-year
term expiring in 1998 or until their respective successors have
been elected. Unless otherwise instructed, the proxy holders will
vote the proxies received by them for Messrs. Long and Weiss and
Ms. Onderdonk, who are the Company's nominees. In the event that
any nominee of the Company 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. It is not expected that any
nominee will be unable or will decline to serve as a director.
Any stockholder entitled to vote for the election of
directors at a meeting may nominate persons for election as
directors only if written notice of such stockholder's intent to
make such nomination is given, either by personal delivery at 4114
E. Wood Street, Phoenix, Arizona or by United States mail, postage
prepaid to Secretary, Arizona Instrument Corporation, 4114 E. Wood
Street, Phoenix, Arizona 85040 not later than: (i) with respect to
the election to be held at an annual meeting of stockholders, 20
days in advance of such meeting, and (ii) with respect to any
election to be held at a special meeting of stockholders for the
election of directors, the close of business on the tenth day
following the date on which notice of such meeting is first given
to stockholders. Each such notice must set forth: (a) the name and
address of the stockholder who intends to make the nomination and
of the person or persons to be nominated; (b) a representation that
such stockholder is a holder of record of stock of the corporation
<PAGE>
entitled to vote at such meeting and intends to appear in person or
by proxy at the meeting to nominate the person or persons specified
in the notice; (c) a description of all arrangements or
understandings between such stockholder and each nominee and any
other person or persons (naming such person or persons) pursuant to
which the nomination or nominations are to be made by such
stockholder; (d) such other information regarding each nominee
proposed by such stockholder as would have been required to be
included in a proxy statement filed pursuant to the proxy rules of
the Securities and Exchange Commission if such nominee had been
nominated, or intended to be nominated, by the Board of Directors;
and (e) the consent of each nominee to serve as a director of the
corporation if elected. The chairman of a stockholder meeting may
refuse to acknowledge the nomination of any person not made in
compliance with the foregoing procedure.
The names of the directors and certain information about
them are set forth below.
Director
Name Age Principal Occupation Since
Walfred R. Raisanen 60 Chairman of the 1981
Board, Vice
President -
Research and
Development, and
Treasurer of the
Company
S. Thomas Emerson 54 Chairman of Xantel 1989
Corporation
John P. Hudnall 44 President and Chief 1988
Executive Officer of
the Company
Quinn Johnson 50 President of Horizon 1992
Engineering and
Testing, Inc., a
wholly-owned
subsidiary of the
Company
Richard Long 66 Marketing and 1987
Management
Consultant
R. J. McCrory 69 President, 1992
Venture Research
Consultants
Patricia Onderdonk 44 Vice President - 1992
Marketing,
Optical Disc
Corporation
Stanley H. Weiss 52 Director and President 1993
Terrell, Weiss &
Sugar, Ltd.
Walfred R. Raisanen has been the Chairman of the Board of
Directors since the Company's inception in January 1981. From 1981
until 1986 he was the President and Treasurer of the Company. Mr.
Raisanen was re-elected Treasurer in 1991 and also serves as Vice
President of Research and Development. From June 1976 until
January 1981 he was President and a Director of Motorola Process
Control, Inc., the predecessor to the Company.
S. Thomas Emerson, Ph.D. has been Chairman of Xantel
Corporation, a private company engaged in computer communications,
since August 1992. Dr. Emerson was Chief Executive Officer of
Syntellect Incorporated, a manufacturer of voice response systems,
from 1984 to April 1992. Prior to founding Syntellect in 1984, Dr.
Emerson was a founder of Periphonics Corporation of Bohemia, New
York where he served for 14 years in various executive capacities.
<PAGE>
John P. Hudnall came to the Company in 1985 as Chief
Financial Officer. He became President and Chief Executive Officer
in 1986 and a Director in 1988. Mr. Hudnall's background spans 22
years in industry, with positions in production, sales, finance and
systems, including a position as Chief Financial Officer for
Inter-Tel, Inc., an independent telephone company.
Quinn Johnson became President of Horizon Engineering &
Testing, Inc., a wholly-owned subsidiary of the Company
("Horizon"), in September 1992 upon the acquisition by the Company
of Horizon's predecessor. Mr. Johnson founded Horizon's
predecessor in 1990. Prior to forming Horizon's predecessor, Mr.
Johnson founded and served since 1983 as president of a company
engaged in general construction, paving and civil engineering.
Previously, Mr. Johnson was a construction manager for Northern
Industries of Eagar, Arizona; a project manager for the U.S. Forest
Service; and a structural engineer for Fluor Corp. of Los Angeles,
California. Mr. Johnson's employment agreement provides that the
Company shall nominate him for, and support his election to, the
Company's Board of Directors.
Richard Long has been involved in the private sector of
the telecommunications industry for over 20 years. He has been
both President and Chairman of the trade association representing
suppliers, contractors and manufacturers in the private sector and
has acted as a spokesman before Congress and regulatory bodies
during that time.
R. J. McCrory has been a director of the Company since
1992. Mr. McCrory is President of Venture Research Consultants, a
consulting firm focusing on strategies for emerging companies.
Previously, he was founder and president of Dymark Company, a new
venture company manufacturing and marketing consumer home repair
products. For 17 years, Mr. McCrory was Vice President of
Engineering and Executive Vice President of Gilbarco, a leading
manufacturer of service station equipment.
Patricia Onderdonk has been the Vice President of
Marketing for Optical Disc Corporation of Santa Fe Springs,
California since mid-1994, a company engaged in developing and
manufacturing high-density CD ROMs. Previously, she co-founded
Onderdonk & Haynes, Inc. in 1986 and had become President of the
marketing and communication consulting firm focused on technology-
based customers. Ms. Onderdonk's background spans 19 years of
marketing and communications experience with positions in account
and general management, including the position of Vice President
and General Manager for Regis McKenna, Inc., a high-technology
marketing and public relations firm.
Stanley H. Weiss has been president and director of
Terrell, Weiss & Sugar, Ltd., an accounting firm in Chicago,
Illinois, since September 1990. Mr. Weiss served as the firm's
secretary-treasurer from October 1981 until September 1990 and has
been a principal of the firm since December 1978. As a practicing
certified public accountant since 1974, Mr. Weiss has been actively
involved in consulting with entrepreneurs and managers in the areas
of income taxes, business planning, financial controls and employee
incentives.
COMPLIANCE WITH SECTION 16(a) REPORTING REQUIREMENTS
Under the securities laws of the United States, the
Company's directors, its executive officers, and any persons
holding more than 10% of the Company's Common Stock are required to
report their initial ownership of the Company's Common Stock and
any subsequent changes in that ownership to the Securities and
Exchange Commission. Specific due dates for these reports have
been established and the Company is required to disclose any
failure to file by these dates. All of these filing requirements
were satisfied during the year ended December 31, 1994. However,
the Company has not received copies of ownership reports due from
Bridge Capital Investors II, which beneficially owns greater than
10% of the Company's outstanding Common Stock, and thus has no
information regarding whether such reports have been filed or filed
on a timely basis with the Commission. In making these
disclosures, the Company has relied solely on written
representations of its directors and executive officers and copies
of the reports that they have filed with the Commission.
<PAGE>
BOARD MEETINGS AND COMMITTEES
The Board of Directors held a total of four meetings during
the fiscal year ended December 31, 1994. No director attended
fewer than 75% of the aggregate of all meetings of the Board of
Directors or any committee on which such director served during the
period of such service.
The Board presently has an Audit Committee and a Compensation
Committee. The Audit Committee currently consists of Mr. Long and
Mr. Emerson and met one time in fiscal 1994. The Audit Committee
meets independently with representatives of the Company's
independent auditors and with representatives of senior management.
The Committee reviews the general scope of the Company's annual
audit, the fee charged by the independent auditors and other
matters relating to internal control systems. In addition, the
Audit Committee is responsible for reviewing and monitoring the
performance of non-audit services by the Company's auditors. The
Committee is also responsible for recommending the engagement or
discharge of the Company's independent auditors.
The Compensation Committee currently consists of Messrs.
Emerson, Long, and McCrory and Ms. Onderdonk, and met two times in
fiscal 1994. The Compensation Committee reviews and reports to the
Board the salaries and benefit programs designed for senior
management, officers and directors with a view to insure that the
Company is attracting and retaining highly qualified managers
through competitive salary and benefit programs and encouraging
extraordinary effort through incentive rewards.
Nominations of persons to be directors are considered by the
full Board of Directors.
<PAGE>
REMUNERATION OF EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
The following table sets forth compensation information with regard
to the Company's Chief Executive Officer and each of the Company's
other executive officers who was serving as an executive officer at
the end of fiscal 1994 and whose salary and bonus aggregated at
least $100,000 for services rendered to the Company during fiscal
1994.
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
Awards Payouts
Name and Principal Other Annual Restricted Options/SARs LTIP All Other
Position Year Salary ($) Bonus ($) Compensation ($) Stock Awards ($) (#) Payouts ($)Compensation ($)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
John P. Hudnall, 1994 153,226 0 5,400(1) 0 0 0 1,425(3)
CEO 1993 143,000 0 5,400(1) 0 95,480(2) 0 1,354(3)
1992 143,000 0 5,400(1) 0 12,000(2) 0 1,400(3)
Walfred R. 1994 135,009 26,460 0 0 0 0 3,329(3)
Raisanen, 1993 124,000 0 0 0 35,480(2) 0 2,974(3)
Vice President - 1992 120,000 0 0 0 12,000(2) 0 3,300(3)
Research and
Development
Quinn Johnson, 1994 129,190 0 0 0 0 0 2,721(3)
President 1993 129,029 15,427 0 0 11,480 0 2,606(3)
Horizon 1992 31,250 0 0 0 0 0 0
Engineering &
Testing, Inc.(4)
</TABLE>
(1) Automobile allowance.
(2) No SARs were granted. All but 11,480 of the options granted in 1993
represent the repricing of options granted in prior years.
(3) Life insurance premium payments.
(4) Commenced employment October 1, 1992.
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
No stock options were granted during the last fiscal year to the
executive officers named in the Summary Compensation Table.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUE TABLE
The following table sets forth information with respect to the
executive officers named in the Summary Compensation Table
concerning the number and value of options outstanding at the end
of the last fiscal year. None of the executive officers named in
the Summary Compensation Table exercised options during the last
fiscal year.
<PAGE>
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised in-the-Money
Options at Fiscal Year-End Options at Fiscal Year-End
Name Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C>
John P. Hudnall 60,000 35,480 0 0
Walfred R. Raisanen 2,352 44,880 0 0
Quinn Johnson 0 11,480 0 0
</TABLE>
EMPLOYMENT/CHANGE OF CONTROL ARRANGEMENTS
Effective November 5, 1992, the Company entered into a
five-year employment agreement with Walfred R. Raisanen pursuant to
which Mr. Raisanen agreed to serve as Vice President of Research
and Development for a base annual salary of $120,000, which is to
be adjusted annually for cost-of-living increases. Mr. Raisanen is
also entitled to participate in any benefit arrangements available
to executive officers of the Company. Upon termination of the
employment agreement by the Company without cause, Mr. Raisanen is
entitled to receive a cash payment equal to the compensation due
him over the balance of the term of the employment agreement, and
to participate in applicable benefit programs for the balance of
the term of the employment agreement.
Effective June 3, 1993, the Company entered into a three-
year employment agreement with its President and Chief Executive
Officer, John P. Hudnall. The agreement provides for a base annual
salary of $143,000, which is to be adjusted annually for cost-of-
living increases. Mr. Hudnall is also entitled to participate in
any benefit arrangements available to executive officers of the
Company. Upon termination of the employment agreement by the
Company without cause, Mr. Hudnall is entitled to receive an amount
equal to the compensation due him over the balance of the term of
the employment agreement, and to participate in applicable benefit
programs for the balance of the term of the employment agreement.
For information regarding the employment agreement of
Quinn Johnson, an executive officer of a subsidiary of the Company,
see "Certain Transactions."
<PAGE>
COMPENSATION OF DIRECTORS
Outside directors are currently paid $1,000 plus expenses
per Board or committee meeting attended. Pursuant to the 1991
Stock Option Plan, non-employee directors are automatically granted
options exercisable for 2,500 shares at the market price on the
date of grant upon joining the Board and on each January 1
thereafter. The options become exercisable six months after grant
and expire two years after termination of Board service. Directors
who are employees are only paid their expenses (if any) for
attendance at meetings.
CERTAIN TRANSACTIONS
Bridge Agreements. On July 6, 1989, the Company entered
into certain agreements (the "Note Agreement") with Bridge Capital
Investors II ("Bridge"). Pursuant to the Note Agreement as amended
through March 30, 1995, Bridge holds a 12% convertible subordinated
note (the "Note") with an outstanding principal balance of
$2,176,000 and a warrant to purchase up to 50,000 shares of the
Company's Common Stock at an exercise price of $.45 per share. As
a result of common stock issued in conjunction with the acquisition
of Horizon on September 30, 1992 and related financing and other
transactions, the Note is now convertible into 787,298 shares of
common stock at $2.76 per share. The Note requires a $375,000
payment of principal on December 31, 1994, $616,667 of principal
plus accrued interest on June 30, 1995 and December 31, 1995 and a
final payment of $567,916 on June 30, 1996. Interest on the unpaid
principal amount of the Note is due and payable on the last day of
each calendar quarter. The Company has been granted a four-month
extension on the December 31, 1994 and June 30, 1995 payments.
The Note Agreement requires that the Company maintain net
worth of $5,500,000. The Note Agreement further provides that the
Company shall have the right to prepay the Note at any time if
prepayment is accompanied by the issuance of warrants to purchase
Common Stock at the rate of 200,000 warrants for each $1,000,000 of
principal which is prepaid. If issued, the exercise price of such
warrants would equal the lower of the conversion price of the Note
or the average market price of the Common Stock for the 30 days
prior to prepayment. The Note Agreement also provides that the
interest rate on the Note shall increase to 16% upon future
defaults, if any.
The Company is also required to purchase the warrants and
prepay the debenture for consideration of $6,000,000 (less
principal repaid, if any) upon the occurrence of certain business
combination transactions, or obtain the consent of Bridge. Bridge
has certain registration rights relating to the shares of Common
Stock issuable upon conversion of the Note or exercise of the
warrants.
Merger Agreement. On September 30, 1992, Horizon was
merged (the "Merger") into a wholly-owned subsidiary of the
Company. Shareholders of Horizon received cash consideration of
$190,000 and shares of the Company's Common Stock. Quinn Johnson
held 90% of the outstanding stock of Horizon at the time of the
Merger and received 529,328 shares of Common Stock in connection
with the Merger. The Company has registered the shares of Common
Stock issued pursuant to the Merger. See "Stock Registration,"
below. Mr. Johnson has agreed to indemnify Horizon and the Company
against certain liabilities in connection with the Company's
acquisition of Horizon, and has placed 49,030 shares of the
Company's Common Stock in escrow in connection therewith.
Non-Competition Agreement. Pursuant to a Non-Competition
Agreement dated September 30, 1992, and in consideration of a cash
payment of $350,000, Mr. Johnson agreed to refrain from competing
with Horizon until the later of September 30, 1998 or two years
after leaving the employment of Horizon, subject to earlier
termination under certain circumstances.
Employment Agreement. Mr. Johnson serves as President of
Horizon pursuant to an Employment Agreement dated September 30,
<PAGE>
1992. The Employment Agreement provides for a base salary of
$125,000 over its four-year term, with annual adjustments tied to
increases in the Consumer Price Index. The Employment Agreement
also provides for an annual bonus based upon Horizon's pretax
profits, with a maximum bonus over the term of the four-year
agreement equal to $700,000. Upon termination of the Employment
Agreement by the Company without cause, Mr. Johnson is entitled to
receive (i) the difference between $700,000 and bonus payments
prior to termination; plus (ii) an amount equal to the then-
applicable annual base salary.
Stock Registration. Pursuant to registration rights
previously granted, the Company filed a shelf registration
statement with the Securities and Exchange Commission ("SEC")
relating to 3,781,003 shares of its Common Stock issued in
connection with private placements in September 1992 and November
1993 and in connection with the acquisition of Horizon in September
1992. Also included in the registration are 209,000 shares of
Common Stock issuable upon the exercise of warrants issued to
Cruttenden & Co., Inc. ("Cruttenden") and its assignees in
connection with Cruttenden's activities as placement agent for the
November 1993 private placement. The registration statement was
declared effective by the SEC in February 1994. The Company has
agreed that it will maintain the effectiveness of the registration
statement (i) until November 1996, with respect to the shares
issued in the November 1993 private placement; (ii) until September
1995, with respect to the shares issued in the September 1992
private placement and the Horizon acquisition; and (iii) until two
years after exercise, with respect to shares issuable upon exercise
of the warrants referred to above. The registration statement as
originally filed included 465,001 shares beneficially owned by
Quinn Johnson, a director and executive officer of the Company,
which shares were acquired by Mr. Johnson in connection with the
acquisition of Horizon by the Company in September 1992. In
connection with the registration, Mr. Johnson agreed that his
registered and other sales of the Company's Common Stock shall not
exceed the volume limitations set forth in Rule 144 under the
Securities Act of 1933, as amended, subject to certain exceptions.
The registration statement also includes 20,000 shares and 20,000
shares beneficially owned by S. Thomas Emerson and Stanley Weiss,
directors of the Company, which shares were acquired in the
November 1993 private placement. The Company and the holders of
the shares of Common Stock included in the registration have agreed
to indemnify each other against certain liabilities.
Other. The Company utilized $150,000 of the net proceeds
from a November 1993 private placement to redeem 69,230 shares of
its Common Stock from Mr. Quinn Johnson, a director and executive
officer of the Company.
During September 1993, the Company loaned $45,000 to
Walfred R. Raisanen, a director and executive officer of the
Company. The loan bears interest at 10% per annum, is
collateralized by 15,000 shares of the Company's Common Stock and
$30,000 of the cash value of a life insurance policy covering Mr.
Raisanen, and is due August 1996.
<PAGE>
PROPOSAL 2
APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed Deloitte & Touche
LLP as independent auditors to audit the consolidated financial
statements of the Company for the fiscal year ending December 31,
1995 and recommends that stockholders vote for ratification of such
appointment. In the event of a negative vote on such ratification,
the Board will reconsider its selection.
Deloitte & Touche LLP has audited the Company's financial
statements annually since 1981. Its representatives are expected
to be present at the meeting with the opportunity to make a
statement if they desire to do so and are expected to be available
to respond to appropriate questions.
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 card to vote the shares they represent as the Board of
Directors may recommend.
STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company which are
intended to be presented by such stockholders at the Company's
annual meeting for the fiscal year ending December 31, 1995 must be
received by the Company no later than January 15, 1996 in order
that they may be considered for inclusion in the proxy statement
and form of proxy relating to that meeting. Additionally, if a
stockholder wishes to present to the Company an item for
consideration as an agenda item for a meeting, he must timely give
notice to the Secretary and give a brief description of the
business desired to be discussed. To be timely for this Annual
Meeting, such notice must be delivered to or mailed to and received
by the Company no later than 5:00 p.m. local time on May 29, 1995.
AVAILABLE INFORMATION
The Company files annual reports on Form 10-KSB with the
Securities and Exchange Commission. A copy of the Form 10-KSB
annual report for the fiscal year ended December 31, 1994 (except
for certain exhibits thereto) may be obtained, free of charge, upon
written request by any stockholder to Arizona Instrument
Corporation, 4114 E. Wood Street, Phoenix, Arizona 85040,
Attention: Stockholder Relations. Copies of all exhibits to the
annual report are available upon a similar request, subject to
payment of a $.15 per page charge to reimburse the Company for its
expenses in supplying any exhibit.
Dated: May 4, 1995
<PAGE>
PROXY
ARIZONA INSTRUMENT CORPORATION
4114 E. WOOD STREET
PHOENIX, ARIZONA 85040
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints John Hudnall and Scott Carter
as Proxies, each with the power to appoint his substitute, and
hereby authorizes each of them to represent and to vote, as
designated below, all the shares of Common Stock of Arizona
Instrument Corporation held of record by the undersigned on May 10,
1995, at the Annual Meeting of Stockholders to be held on June 22,
1995 or any adjournment thereof.
1. ELECTION OF DIRECTORS
/ / FOR the nominees listed below (except as marked to the
contrary below)
/ / WITHHOLD AUTHORITY to vote for the nominees
listed below (INSTRUCTION: To withhold authority to
vote for an individual nominee, strike a line through
the nominee's name below).
Richard Long Patricia Onderdonk Stanley Weiss
2. PROPOSAL TO APPROVE AND RATIFY THE APPOINTMENT OF DELOITTE &
TOUCHE LLP
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the meeting or
any adjournment thereof.
______________________________
<PAGE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE
NOMINEES AND FOR PROPOSAL 2.
Please sign exactly as name appears below.
When shares are held by more than one owner,
all should sign. When signing as attorney,
executor, administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full corporate
name by President or authorized officer. If
a partnership, please sign in partnership name
by authorized person.
Dated: ___________________, 1995
(Be sure to date this Proxy)
___________________________________________
Signature
___________________________________________
Signature
