<PAGE>
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:
[_] 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
PERSONAL COMPUTER PRODUCTS, INC.
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(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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
[LOGO OF PERSONAL COMPUTER PRODUCTS, INC.]
PERSONAL COMPUTER PRODUCTS, INC.
- --------------------------------------------------------------------------------
10865 Rancho Bernardo Road . San Diego, CA 92127
Phone: 619-485-8411 . Fax: 619-487-5809
November 10 1995
Dear Stockholder:
It is a pleasure to send to you the attached notice and proxy material with
regard to the annual meeting of stockholders of Personal Computer Products, Inc.
The matters to be considered at this meeting include election of directors and
ratification of the selection of accountants.
I hope you will be able to attend the annual meeting. Whether or not you plan to
attend the annual meeting, however, we request that you sign, date and return
the enclosed proxy card as soon as possible.
We are grateful for the confidence you have shown in us.
Sincerely yours,
Edward W. Savarese,
Chairman, President and
Chief Executive Officer
<PAGE>
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 21, 1995
To the Stockholders of
Personal Computer Products, Inc.:
The Annual Meeting of Stockholders of Personal Computer Products, Inc., a
Delaware corporation ("PCPI"), will be held at 10865 Rancho Bernardo Road, San
Diego, California on Thursday, December 21, 1995 at 11:00 a.m. for the following
purposes:
1. To elect a Board of Directors;
2. To act upon a proposal to ratify the selection of Boros & Farrington APC
as PCPI's independent accountants for fiscal year 1996;
and to transact such other business as may properly come before the Meeting, or
any postponements or adjournments thereof.
The Board of Directors has fixed the close of business on October 12, 1995 as
the record date for determination of stockholders entitled to notice of and to
vote at the Meeting.
All stockholders are cordially invited to attend the Meeting. In order to
allow us to provide adequate accommodations, please indicate on the enclosed
proxy card if you plan to attend in person.
BY ORDER OF THE BOARD OF DIRECTORS
Ralph R. Barry,
Secretary
Dated: November 10, 1995
YOUR VOTE IS IMPORTANT!
Please immediately date, sign and return your proxy in the enclosed envelope. If
you attend the meeting, you may withdraw your proxy and vote in person.
THANK YOU FOR ACTING PROMPTLY.
<PAGE>
PERSONAL COMPUTER PRODUCTS, INC.
- --------------------------------------------------------------------------------
10865 Rancho Bernardo Road . San Diego, California 92127
PROXY STATEMENT
INTRODUCTION
GENERAL INFORMATION FOR STOCKHOLDERS
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Personal Computer Products, Inc., a
Delaware corporation ("PCPI" or the "Company"), for use at the Annual Meeting of
Stockholders of PCPI to be held on December 21, 1995 or at any postponements or
adjournments thereof, for the purposes set forth in the accompanying Notice of
Annual Meeting of Stockholders. This proxy statement, the accompanying form of
proxy and PCPI's annual report for fiscal year 1995 are first being sent to
stockholders on or about November 10, 1995. If a proxy in the accompanying form
is duly executed and returned, the shares represented thereby will be voted, and
where a specification is made by the stockholder as provided therein, will be
voted in accordance with such specification. A stockholder giving a proxy may,
nevertheless, revoke it before its exercise by filing with the Secretary of PCPI
either an instrument revoking the proxy or a duly executed proxy bearing a later
date. A proxy will be revoked automatically if the stockholder who executed it
is present at the Meeting and votes in person.
The cost of the solicitation of proxies will be borne by PCPI. In addition
to solicitation by mail, certain directors, officers and regular employees of
PCPI, without receiving any additional compensation, may solicit proxies
personally or by telephone or telegram. PCPI will reimburse brokers and others
holding stock in their names, or in the names of nominees, for forwarding proxy
material to their principals.
VOTING SECURITIES
On October 12, 1995 (the "record date" for determination of stockholders
entitled to notice of and to vote at the Meeting), PCPI had outstanding
17,583,453 shares of Common Stock, which is the only class of stock entitled to
vote at the Meeting. Each share entitles the holder thereof to one vote on all
matters to be presented at the meeting.
BENEFICIAL OWNERSHIP OF VOTING SECURITIES
The following table sets forth the number of shares of equity securities of
PCPI owned beneficially (as determined in accordance with the rules adopted by
the Securities and Exchange Commission ("SEC") under the Securities Exchange Act
of 1934) for all persons (including any "group") known to PCPI to be the
beneficial owner of more than five percent of any class of voting securities of
PCPI as of October 27, 1995, except as disclosed in the Security Ownership of
Management section below.
<TABLE>
<CAPTION>
TITLE OF CLASS NAME SHARES BENEFICIALLY OWNED PERCENT OF CLASS
- -------------- ---- ------------------------- ----------------
<S> <C> <C> <C>
PCPI Common Nippo, Ltd. 2,117,197 12.0
</TABLE>
Nippo, Ltd., a Japanese corporation ("Nippo"), is located at 5-27-12 Sakae,
Naka-ku, Nagoya, Japan 460.
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth the number of shares of equity securities of
PCPI owned beneficially (as determined in accordance with the rules adopted by
the SEC under the Securities Exchange Act of 1934) as of October 27, 1995 by
each director and nominee for election as a director of PCPI, by each executive
officer of PCPI who earned more than $100,000 during fiscal year 1995, and by
all directors and executive officers as a group. In each case, such beneficial
ownership includes both sole voting and sole investment power. Nippo, Dr.
Savarese and Mr. Roth were, to the knowledge of PCPI, the only persons owning
beneficially (as determined in accordance with such rules) more than 5% of any
class of voting securities of PCPI as of such date. The business addresses of
Dr. Savarese and Mr. Bonar are the same as that of the Company. Mr. Roth and Dr.
Saal's business addresses are, respectively, 322 West 57th Street, Apartment
45T, New York, New York 10019, and 2520 Mission College Blvd. Santa Clara,
California 95054.
<TABLE>
<CAPTION>
TITLE OF CLASS NAME SHARES BENEFICIALLY OWNED PERCENT OF CLASS
- -------------- ---- ------------------------- ----------------
<S> <C> <C> <C>
PCPI Common Edward W. Savarese 1,171,350(a) 6.3
PCPI Common Irwin Roth 939,400(b) 5.2
PCPI Common Harry J. Saal 530,000(c) 3.0
PCPI Common Brian Bonar 140,000(d) .8
PCPI Common All directors and executive 2,890,750(e) 14.7
officers as a group (5 persons)
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
TITLE OF CLASS NAME SHARES BENEFICIALLY OWNED PERCENT OF CLASS
- -------------- ---- ------------------------- ----------------
<S> <C> <C> <C>
LPAC Common Edward W. Savarese 127,500(a) 4.1
LPAC Common Irwin Roth 126,500(b) 4.0
LPAC Common Harry J. Saal 76,500(c) 2.5
LPAC Common All directors and executive 330,500(e) 9.9
officers as a group (5 persons)
</TABLE>
(a) Includes options and/or warrants, now exercisable or exercisable within 60
days, to purchase 925,000 shares of PCPI Common Stock and 127,500 shares of
LPAC Common Stock. Also includes 30,000 shares of PCPI Common Stock owned by
Dr. Savarese's children; Dr. Savarese disclaims beneficial ownership of
those shares.
(b) Includes options and/or warrants, now exercisable or exercisable within 60
days, to purchase 658,335 shares of PCPI Common Stock and 126,500 shares of
LPAC Common Stock.
(c) Includes options and/or warrants, now exercisable or exercisable within 60
days, to purchase 253,700 shares of PCPI Common Stock and 76,500 shares of
LPAC Common Stock.
(d) Includes options and/or warrants, now exercisable or exercisable within 60
days, to purchase 140,000 shares of PCPI Common Stock.
(e) Includes options and/or warrants, now exercisable or exercisable within 60
days, to purchase 2,087,035 shares of PCPI Common Stock and 330,500 shares
of LPAC Common Stock. Also includes 30,000 shares of PCPI Common Stock owned
by Dr. Savarese's children; Dr. Savarese disclaims beneficial ownership of
those shares.
All percentages in this section were calculated on the basis of outstanding
securities plus securities deemed outstanding pursuant to Instruction 3 to Item
403 of Regulation S-B, under the Securities Exchange Act of 1934.
MATTERS TO BE CONSIDERED AT ANNUAL MEETING
ITEM NO. 1 - ELECTION OF DIRECTORS
NOMINEES FOR ELECTION AS DIRECTORS; EXECUTIVE OFFICERS
Four (4) directors are to be elected at the Meeting, each to serve until
the next annual meeting or until a successor is elected. All of the nominees are
now serving as directors of PCPI and all four have consented to be named and
have indicated their intent to serve if elected, and the proxyholders named in
the accompanying form of proxy will vote the shares represented by the proxy for
all of the nominees unless withholding of authority to vote has been specified
on the proxy with respect to one or more directors. If for any reason any
nominee named is not a candidate (which is not expected) when the election
occurs, the proxyholders will vote the shares for the other nominees named and
for such other person as may be designated by the Board of Directors.
The following table sets forth certain information regarding the nominees
for election to the Board of Directors of PCPI.
<TABLE>
<CAPTION>
NAME AGE SINCE DIRECTOR TITLE
- ---- --- ----- --------------
<S> <C> <C> <C>
Edward W. Savarese 48 1983 Director, Chairman of the Board, President and Chief Executive Officer
Brian Bonar 48 1995 Director and Executive Vice President Sales, Marketing and Engineering
Irwin Roth 64 1983 Director
Harry J. Saal 51 1983 Director
</TABLE>
Dr. Savarese is a founder of PCPI and has been Chairman and Chief Executive
Officer of PCPI and its predecessor since 1982, and in addition has been the
President of PCPI since 1989.
Mr. Bonar has been with PCPI since August 1992 as Director of Technology
Sales, and in April 1994 was appointed Vice President, Sales and Marketing. In
September 1994, Mr. Bonar became Executive Vice President Sales, Marketing and
Engineering and in August 1995 a Director. From 1991 to 1992, Mr. Bonar was Vice
President of Worldwide Sales and Marketing for Bezier Systems, Inc., a San Jose,
California-based manufacturer and marketer of laser printers. From 1990 to 1991,
he was Worldwide Sales Manager for Adaptec, Inc., a San Jose-based laser printer
controller developer. From 1988 to 1990, he was Vice President of Sales and
Marketing for Rastek Corporation, a laser printer controller developer located
in Huntsville, Alabama.
2
<PAGE>
Mr. Roth is an attorney, and has been practicing law in New York City for
more than the past five years. He has served on the Company's Board of Directors
since 1982. He was a co-founder of Panafax, Inc., the first marketer of
facsimile machines in the United States. He holds Bachelor's and law degrees
from the University of Michigan.
Dr. Saal has been President and Chief Executive Officer of Smart Valley,
Inc., a company which is working to create an electronic community in the San
Francisco Bay Area of California, since September 1, 1993. In addition, from
1986 until 1993 Dr. Saal was the President and a Director of Network General
Corp., which is engaged in the design, manufacture and sale of diagnostic
systems for local area networks (and related products). Dr. Saal continues to
serve as a Director of Network General Corp.
In addition to Dr. Savarese and Mr. Bonar, Ralph R. Barry, age 37, is an
executive officer of PCPI and serves as its Chief Financial Officer, Secretary
and Treasurer. Mr. Barry, a CPA, joined PCPI as Controller and Chief Accounting
Officer, and Assistant Secretary in October 1993 and became Chief Financial
Officer and Secretary in August 1995. Prior thereto, Mr. Barry served as a
senior accountant with Price Waterhouse since August 1989.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors held 13 meetings in fiscal year 1995. In addition to
action taken at meetings, the Board on occasion acts by unanimous written
consent.
The Board of Directors currently has no committees. Other than Mr. Bonar
who became a Director in August 1995, each of PCPI's current directors attended
at least 75% of the fiscal year 1995 meetings of the Board.
ITEM NO. 2 - SELECTION OF INDEPENDENT ACCOUNTANTS
The Board has selected the firm of Boros & Farrington APC as independent
accountants for PCPI for the fiscal year ending June 30, 1996, it being intended
that such selection would be proposed for ratification by the stockholders. The
proxyholders named in the accompanying form of proxy will vote the shares
represented by the proxy for ratification of the selection of Boros & Farrington
APC unless a contrary choice has been specified on the proxy. If the
stockholders do not ratify the selection of Boros & Farrington APC, the
selection of independent accountants will be reconsidered by the Board of
Directors. The Board retains the power to select another firm as independent
accountants for PCPI to replace a firm whose selection was ratified by the
stockholders in the event the Board determines that a change would be in the
best interest of PCPI.
Representatives of Boros & Farrington APC are expected to be present at the
Meeting to respond to appropriate questions and to make a statement if they
desire to do so.
EXECUTIVE COMPENSATION
The following table shows as to each of the executive officers who earned
more than $100,000 during the fiscal year ended June 30, 1995, information
concerning compensation for services rendered in all capacities to PCPI and its
subsidiaries during the previous three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION
COMPENSATION AWARDS
------------------------------------ ------------
FISCAL OTHER ANNUAL OPTIONS/
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION SARS (#)
- --------------------------- ------ ------ ----- ------------ ----------
<S> <C> <C> <C> <C> <C>
Edward W. Savarese.................... 1995 $229,290 $------ $74,000/(1)/ ------
Director, Chairman of the Board, 1994 200,000 30,000 ------ 175,000
President and Chief Executive Officer 1993 194,192 15,000 ------ ------
Brian Bonar............................ 1995 129,039 ------ ------ 350,000
Director, Executive Vice President, 1994 135,469 ------ ------ 150,000
Sales, Marketing and Engineering/(2)/
All executive officers as a group 1995 419,637 ------ $74,000 350,000
(3 persons for 1995, 5 persons for 1994 625,909 54,000 ------ 618,500
1994 and 2 persons for 1993). 1993 352,372 25,000 ------ ------
</TABLE>
(1) As of June 30, 1995, $2,811 remained unpaid for Dr. Savarese. The amount
for 1995 includes $74,000 of accrued but unpaid vacation benefits used by
Dr. Savarese to exercise warrants to purchase stock.
3
<PAGE>
(2) Mr. Bonar was hired August 1, 1992 and was appointed Vice President, Sales
and Marketing on April 28, 1994. The table includes all of Mr. Bonar's
fiscal 1994 compensation even though he was not an executive officer for
all of fiscal 1994.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table provides information on options/SARs granted in fiscal
year 1995 to the named executive officers.
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF TOTAL
SECURITIES OPTIONS/SARs EXERCISE
UNDERLYING GRANTED TO OR BASE
OPTIONS/SARs EMPLOYEES IN PRICE
NAME GRANTED (#) FISCAL YEAR ($/SHARE) EXPIRATION DATE
---- ------------- ---------------- ---------- ---------------
<S> <C> <C> <C> <C>
Brian Bonar 100,000(1) 14.6% $.75 September 22, 1998
Brian Bonar 250,000(2) 36.4% $.52 April 25, 2005
All executive officers
as a group (3 persons) 350,000 51.0%
</TABLE>
(1) Warrants were granted to purchase common stock of PCPI with warrants for
20,000 shares exercisable on date of grant, September 22, 1994, and the
remaining balance becoming exercisable equally on an annual basis over the
first four years of the warrant term.
(2) Stock options were granted on April 24, 1995 to purchase common stock of
PCPI. The options become exercisable over a three year period beginning
April 24, 1996 in installments of 100,000, 75,000 and 75,000 respectively.
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
The following table provides information on option/SAR exercises in fiscal
year 1995 by the named executive officers and the value of such officers'
unexercised options/SARs at June 30, 1995. Warrants to purchase PCPI common
stock are included as options.
<TABLE>
<CAPTION>
SHARES NUMBER OF SECURITIES VALUE OF UNEXERCISED
ACQUIRED ON VALUE UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS/SARs
NAME EXERCISE (#) REALIZED ($) OPTIONS/SARs AT FY-END (#) AT FISCAL YEAR END ($)/(1)/
----- ------------ ------------- -------------------------- ---------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Edward W. Savarese 300,000 9,375 925,000 ----- ----- -----
Brian Bonar ------ ------ 70,000 430,000 ----- -----
Ralph R. Barry ------ ------ 93,000 34,000 ----- -----
All executive officers as
a group (3 persons) 300,000 9,375 1,088,000 464,000 ----- -----
</TABLE>
(1) Fiscal year ended June 30, 1995. The average of the bid and asked price of
the Company's Common Stock on that date on NASDAQ was $0.47.
DIRECTOR COMPENSATION
As fees for service on PCPI's Board of Directors, the non-employee
directors of PCPI received in fiscal 1995 and will receive in fiscal 1996 $1,500
per month plus travel expenses. Employee directors receive no additional
compensation for service on the PCPI Board of Directors. In addition, the
Company calls upon Mr. Roth from time to time to provide special consulting
services on various corporate matters, for cash compensation. On April 1, 1994,
PCPI and Mr. Roth entered into a five-year consulting agreement for Mr. Roth to
continue to provide these services payable in monthly installments of $9,000.
The Company paid Mr. Roth $36,000 in such consulting fees during fiscal 1995 and
$27,000 for services were unpaid at June 30, 1994. In addition, Mr. Roth
exercised warrants with an aggregate value of $72,000 to purchase common stock
and such amount was offset against amounts owing to Mr. Roth under the
consulting agreement.
4
<PAGE>
EMPLOYMENT AGREEMENTS
PCPI entered into an employment agreement with Dr. Savarese, effective as
of July 1, 1990, calling for employment for five years. On February 25, 1994,
the agreement was amended to extend the term for an additional four years
through June 30, 1999. Minimum salaries under the amended agreement commencing
July 1, 1995 are $240,000, $255,000, $270,000 and $285,000.
PCPI also entered into an employment agreement with Mr. Bonar, effective
September 1, 1994, calling for employment through June 30, 1999, at an annual
base salary of $120,000 with a 3.5% cost of living increase each year commencing
July 1, 1995. In addition to the annual base salary, Mr. Bonar will be subject
to commission under a plan and quotas to be established at the start of each
fiscal year.
These employment agreements provide that, in the event of termination
without cause, whether or not occurring in the aftermath of a change in
corporate control, the Company shall pay the executive, within 72 hours after
his termination, his entire salary for the remainder of the entire term, and
shall also continue his fringe benefits for the remainder of the entire term.
In the event of the executive's death or permanent disability, his salary
shall continue during the entire term, and his stock options shall be
exercisable until two years after his death or permanent disability.
The executive shall be entitled to severance pay equal to one-half of his
fiscal 1999 annual salary if his employment terminates upon the scheduled
expiration of the employment agreement, or if he is terminated without cause
within six months before the scheduled expiration of the employment agreement.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In October 1993, in connection with major stockholder Nippo, Ltd.'s
acquisition of its 1,000,000 shares of PCPI Common Stock for $1,000,000, PCPI
entered into an International Sales Representative Agreement with Nippo and
appointed Nippo its exclusive sales representative of laser printer controllers
and laser printer controller technology with regard to laser printer
manufacturers in Japan.
In July and October 1994, Nippo and one of its affiliates loaned PCPI a
total of $686,000, due in one year, at interest rates ranging from 3% to 7%. In
January 1995, the outstanding principal and accrued interest totaling $698,000
was converted into the Company's common stock.
In March 1995, Dr. Savarese agreed to loan the Company a gross aggregate
amount of up to $100,000 with interest at the rate of 7% per year. As of
September 30 1995, borrowings under this Note aggregated $100,000.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors recommends a vote FOR the nominees listed herein and
FOR ratification of the selection of independent certified public accountants.
OTHER MATTERS
OTHER BUSINESS
So far as the management of PCPI is aware, no business other than that
described in this proxy statement will come before the Meeting. If any other
business properly comes before the Meeting, or any postponements or adjournments
thereof, the proxyholders named in the accompanying proxy will vote thereon the
shares represented by the proxy in accordance with their best judgment.
5
<PAGE>
STOCKHOLDER PROPOSALS FOR 1996 ANNUAL MEETING
Stockholder proposals intended to be presented at the 1996 Annual Meeting
(i.e., the meeting to be held following the end of fiscal year 1996) must be
received on or before September 30, 1996 by the Company at its office address
set forth on the first page of this proxy statement, and all the other
conditions of Rule 14a-8 under the Securities Exchange Act of 1934 must be
satisfied, for such proposals to be included in PCPI's proxy statement and form
of proxy relating to that meeting.
BY ORDER OF THE BOARD OF DIRECTORS
Ralph R. Barry,
Secretary
San Diego, California
November 10, 1995
6
<PAGE>
[LOGO OF PERSONAL COMPUTER PRODUCTS, INC.]
PERSONAL COMPUTER PRODUCTS, INC.
- --------------------------------------------------------------------------------
10865 Rancho Bernardo Road . San Diego, CA 92127
Phone: 619-485-8411 . Fax: 619-487-5809
