SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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 Materials Pursuant to Section 240.14a-11(c)
or Section 240.14a-12
FIRECOM, INC.
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
[ X ] No fee required.
[ ] 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 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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<PAGE>
FIRECOM, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of Firecom, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the
"Meeting") of FIRECOM, INC., a New York corporation (the "Company"), will be
held on Wednesday, October 20, 1999 at 3:00 P.M., at Thelen Reid & Priest LLP,
40 West 57th Street, Cafeteria, 28th floor, New York, New York 10019 for the
following purposes:
1. To elect three of the Company's six directors to serve until the
2001 Annual Meeting of Shareholders and until their successors have been duly
elected and qualified;
2. To transact such other business as may properly come before the
Meeting or at any adjournment thereof.
Only holders of record of the Company's Common Stock and Class A Common
Stock, $.01 par value, at the close of business on September 21, 1999, which has
been fixed as the record date for the Meeting, shall be entitled to notice of,
and to vote at, the Meeting and any adjournments thereof.
Shareholders are cordially invited to attend the Meeting in person. Whether
or not you plan to attend the Meeting, please sign, date and return the enclosed
proxy card to ensure that your shares are represented at the Meeting.
Shareholders who attend the Meeting may vote their shares personally, even
though they have sent in their proxies.
September 23, 1999
Paul Mendez, Chairman of the Board
IMPORTANT
THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF FURTHER
REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. A SELF-ADDRESSED ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED WITHIN THE
UNITED STATES.
<PAGE>
FIRECOM, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
OCTOBER 20, 1999
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of FIRECOM, INC., a New York corporation (the
"Company"), to be voted at the Annual Meeting of Shareholders of the Company
(the "Meeting") which will be held at Thelen Reid & Priest LLP, 40 West 57th
Street, Cafeteria, 28th floor, New York, New York 10019 on October 20, 1999, at
3:00 P.M., local time, and at any adjournment or adjournments thereof, for the
purposes set forth in the accompanying Notice of Annual Meeting of Shareholders
and in this Proxy Statement.
The principal executive offices of the Company are located at 39-27 59th
Street, Woodside, New York 11377. The approximate date on which this Proxy
Statement and accompanying Proxy will first be sent or given to shareholders is
September 23, 1999.
VOTING SECURITIES AND VOTE REQUIRED
Only shareholders of record as of the close of business on September 21,
1999 (the "Record Date") will be entitled to notice of, and to vote at, the
Meeting and at any adjournments thereof. On the Record Date, there were
outstanding (a) 7,298,524 shares of the Company's common stock, $.01 par value
(the "Common Stock"), and (b) 6,043,657 shares of the Company's Class A common
stock, $.01 par value. Each holder of Common Stock is entitled to one vote for
each share held by such holder. Each holder of the Company's Class A common
stock is entitled to thirty votes for each share held by such holder.
Under the New York Business Corporation Law (the "BCL") and the Company's
By-Laws, the presence, in person or by 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 Meeting. Proxies that
are marked "abstain" will be treated as present for purposes of determining a
quorum for the Meeting. Proxies returned by brokers as "non-votes" on behalf of
shares held in street name because beneficial owners have withheld discretion as
to one or more matters on the agenda for the Meeting will not be treated as
present for purposes of determining a quorum for the Meeting, unless such
proxies vote on at least one matter on the agenda.
The election of directors requires the affirmative vote of a plurality of
the vote present and voting at the Meeting or at any adjournment thereof.
Abstentions and broker non-votes will not be treated as shares that are voted
with respect to a specific proposal.
VOTING OF PROXIES
A Proxy, in the accompanying form, which is properly executed, duly
returned to the Company and not revoked will be voted in accordance with the
instructions contained therein. If no specification is indicated on the Proxy,
the shares represented thereby will be voted FOR the election of the three
directors. Each such Proxy granted may be revoked at any time thereafter by
execution and delivery of a subsequent Proxy or by attendance and voting in
person at the Meeting, except as to any matter or matters upon which, prior to
such revocation, a vote shall have been cast pursuant to the authority conferred
by such Proxy. Mr. Paul Mendez, Chairman of the Board, President and Chief
Executive Officer of the Company, controls more than a majority of the vote with
respect to the matters scheduled to come before the Meeting (see "Security
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Ownership" and "Related Transactions"). Mr. Mendez has advised the Company that
he intends to vote all shares controlled by him for the proposals stated herein,
thereby assuring the election of the three directors.
SECURITY OWNERSHIP
The following table sets forth certain information as of June 30, 1999
(except for employee stock option information which is as of April 30, 1999)
regarding (i) the ownership of each class of common stock of the Company by each
person who is known to the management of the Company to have been the beneficial
owner of more than 5% of the outstanding shares of each class of the Company's
common stock, (ii) the ownership interests of each present director, (iii) the
ownership interests of the Chief Executive Officer and other executive officers
of the Company whose total annual salary and bonus exceeded $100,000 during the
fiscal year ended April 30, 1999 and (iv) the ownership interests of all
directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Title of Name and Address of Position Amount and Nature of % of
Class Beneficial Owner with Company Beneficial Ownership Class
- --------------------------------------------------------------------------------------------------------------------
Common Stock Paul Mendez Chairman of the Board 2,478,984(1) 43.4%
$.01 par value 39-27 59th Street Chief Executive Officer and
Woodside, NY Director
Ildar Idris None 353,334(1) 6.2%
15 Horvath Strasse
Grfeling 8032,
West Germany
Carol Mendez None 1,164,250 20.4%
39-27 59th Street
Woodside, NY
Howard L. Kogen Chief Operating Officer/Executive 392,900(2) 6.9%
Vice President
Antoine J. Sayour Senior Vice President 295,100(3) 5.2%
Jeffrey Cohen Vice President-Finance 12,000(4) *
Orhan I. Sadik-Khan Director 1(1) *
Hilary B. Miller Director 12,000(5) *
Ronald A. Levin Director -0- --
Peter Barotz Director -0-(1) --
Harry B. Levine Director 5,000 *
All executive officers 3,195,085(1)(2) 56%
and directors as a (3)(4)(5)
group (7 persons)
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Title of Name and Address of Position Amount and Nature of % of
Class Beneficial Owner with Company Beneficial Ownership Class
- --------------------------------------------------------------------------------------------------------------------
Class A Paul Mendez Chairman of the Board 2,478,983(1) 49.3%
Common Stock 39-27 59th Street Chief Executive Officer and
$.01 par value Woodside, NY Director
Ildar Idris None 353,334(1) 7.0%
15 Horvath Strasse
Grfeling 8032,
West Germany
Carol Mendez None 1,164,250 23.2%
39-27 59th Street
Woodside, NY
Howard L. Kogen Chief Operating Officer/Executive 19,300(2) *
Vice President
Antoine J. Sayour Senior Vice President 20,300(3) *
Jeffrey Cohen Vice President-Finance -0-(4) --
Orhan I. Sadik-Khan Director -0-(1) --
Hilary B. Miller Director 12,000(5) *
Ronald A. Levin Director -0- --
Peter Barotz Director -0-(1) --
Harry B. Levine Director 5,000 *
All executive officers 2,534,683(1)(2) 50%
and directors as a (3)(4)(5)
group (5 persons)
</TABLE>
*Owns less than 1%.
(1) Pursuant to a voting agreement with certain shareholders of the Company,
Paul Mendez, Carol Mendez and the other parties thereto agreed that all shares
of Common Stock held by Naomi Pollack, Nathan Barotz, Celia Barotz and Lam
Investment Co. (the "Barotz Group"), Orhan Sadik-Khan, Dr. Ildar Idris, Karim
Sadik-Khan, Janette Sadik-Khan, Sadik-Kahn Family Trust (the"Sadik-Khan Group"),
Carol Mendez and Mr. Mendez shall be voted so that the Board of Directors of the
Company shall consist of six persons elected by the holders of the Common Stock
as follows: Mr. Sadik-Khan (or his designee), Mr. Barotz (or his designee), Mr.
Mendez and three persons designated by Mr. Mendez.
(2) Includes 19,300 shares of Common Stock beneficially owned by Mr. Kogen with
his wife as joint tenants and 373,600 shares of Common Stock underlying
presently exercisable options.
(3) These shares include 20,300 shares of Common Stock beneficially owned by Mr.
Sayour with his wife as joint tenants and 274,800 of Common Stock underlying
presently exercisable options.
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(4) Includes 12,000 shares of Common Stock underlying presently exercisable
options for Mr. Cohen.
(5) These shares include 2,000 shares of Common Stock and 2,000 shares of Class
A Common Stock which are owned by Mr. Miller's wife, as to which he disclaims
beneficial ownership.
PROPOSAL I
ELECTION OF DIRECTORS
---------------------
A total of three directors (Class A Directors) are to be elected at the
Meeting to serve until the 2001 Annual Meeting of Shareholders. Three other
directors (Class B Directors) namely, Orhan I. Sadik-Khan, Ronald A. Levin and
Harry B. Levine, will be up for re-election at the 2000 Annual Meeting of
Shareholders.
There were five (5) meetings of the Board of Directors of the Company held
during the fiscal year ended April 30, 1999. All directors attended 75% or more
of the meetings of the Board.
Directors shall be elected by a plurality of the votes cast at the Meeting.
The names of the nominees and certain information with regard to each nominee
follows:
CLASS A DIRECTORS (TO SERVE UNTIL THE 2001
ANNUAL MEETING OF SHAREHOLDERS)
<TABLE>
<CAPTION>
<S> <C> <C> <C>
HAS SERVED AS POSITION (S) WITH THE
NAME AGE DIRECTOR SINCE COMPANY
- ---- --- -------------- ---------------------
Paul Mendez 56 1991 Director
Peter Barotz 70 1993 Director
Richard G. Scurry, Jr. 61 N/A Director
</TABLE>
Paul Mendez was elected a director, Chairman of the Board and President of
the Company on July 19, 1991. He is also employed as Vice President of Multiplex
Electrical Services, Inc., a company which is engaged in the business of
manufacturing, installing and servicing fire alarm systems in New York City.
Peter Barotz was elected a director of the Company in April 1993. For more
than the last five years, he has been engaged primarily as a private investor.
Mr. Barotz has also served as President of Panda Capital Corp., a New Rochelle,
New York-based business engaged in the export business.
Richard Scurry was employed as a registered broker with Sanford C.
Bernstein & Co., Inc., working in the Investment Management and Research
Department, from July 1996 to July 1999. Prior to such employment, Mr. Scurry
was self-employed as an independent investor, engaged in funding a new company.
Mr. Scurry previously served as a director of the Company from July 1991 to July
1996.
Other Directors and Executive Officers
Set forth below is certain information regarding the other directors and
executive officers of the Company:
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NAME AGE POSITION(S) WITH THE COMPANY
- ---- --- ----------------------------
Howard L. Kogen 59 Chief Operating Officer/Executive
Vice President
Antoine P. Sayour 49 Senior Vice President
Jeffrey Cohen 42 Vice President--Finance
Orhan I. Sadik-Khan 69 Director
Ronald A. Levin 56 Director
Hilary B. Miller 48 Director
Harry B. Levine 63 Director
Howard L. Kogen joined the Company as Vice President--Sales and Marketing
in March 1984. He was appointed Executive Vice President and Chief Operating
Officer in 1990.
Antoine P. Sayour joined the Company as Chief Engineer in 1984. He is now
Senior Vice President of the Company and President of the Fire Service
Subsidiary.
Jeffrey Cohen joined the Company as Vice President--Finance in September
1997. Prior to joining the Company, Mr. Cohen had been the Chief Financial
Officer, for more than eight years, of an apparel manufacturing company
headquartered in New Jersey.
Orhan Sadik-Khan was elected a director of the Company in April 1993. Mr.
Sadik-Khan serves as Chairman of New England Business Group and
Mideastonline.com. Mr. Sadik-Khan is also a Director of Imagine Tile.
Ronald A. Levin, since 1991, has been a partner in the certified public
accounting firm of Levin, Bartlett & Co., Franklin Lakes, New Jersey.
Hilary B. Miller has been President of Stanger, Miller, Inc., since 1987.
His company is a private investment firm located in Greenwich, Connecticut. Mr.
Miller's term of office as a director expires at the Annual Meeting.
Harry B. Levine has served as President of Levine Securities, Inc. for more
than five years. His firm is a member of the New York Stock Exchange.
There are no family relationships between any present director or officer
and any other present director or officer.
The Board of Directors of the Company has no standing committees.
The Company is not aware of any Section 16(a) filing deficiencies.
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COMPENSATION AND OTHER BENEFITS
The following table sets forth certain information with respect to cash
compensation paid or accrued by the Company, for services rendered to the
Company during the Company's last three fiscal years, to each of the executive
officers of the Company whose aggregate remuneration exceeded $100,000.
SUMMARY COMPENSATION TABLE
Annual Compensation
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Long-Term Compensation
Name and Principal Position Fiscal Year Salary Bonus Options/SAR Awards
- ------------------------------------ --------------- ------------------- ---------------- -----------------------------
Paul Mendez 1999 $200,000 $123,809 -0-
Chairman and 1998 200,000 49,794 -0-
President 1997 200,000 184,031 -0-
Howard L. Kogen 1999 $145,000 $31,416 -0-
Chief Operating Officer/ 1998 140,000 19,313 -0-
Executive Vice President 1997 138,000 47,186 -0-
Antoine J. Sayour 1999 $126,873 $21,465 -0-
Senior Vice President 1998 122,955 13,201 -0-
1997 118,420 32,267 -0-
Jeffrey Cohen 1999 $98,077 $15,000 -0-
Vice President-Finance 1998 52,135 15,000 -0-
1997 -0- -0- -0-
</TABLE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
NUMBER OF SECURITIES
UNDERLYING
UNEXERCISED
OPTION/SAR'S AT VALUE OF UNEXERCISED
SHARES FY-END (#) IN-THE-MONEY OPTIONS/ SAR'S
ACQUIRED VALUE EXERCISABLE/ AT FY-END ($) EXERCISABLE/
NAME ON EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE
---- ----------- -------- ------------- -------------
Paul Mendez -0- -0- 1,000,000/-0 $192,260/-0
Howard L. Kogen -0- -0- 373,600/26,400 $95,316/$4,884
Antoine J. Sayour -0- -0- 274,800/25,200 $68,538/$4,662
Jeffrey Cohen -0- -0- 12,000/68,000 $-0-/-0-
</TABLE>
STOCK OPTIONS
- -------------
The Company adopted an Incentive and Non-Qualified Stock Option Plan (the
"Plan") which provided for the granting of not more than 1,700,000 shares of
Common Stock. The Plan is open to officers, directors and certain employees of
the Company and will expire on April 30, 2008. Subject to the provisions of the
Plan with respect to death, retirement and termination of employment, the
maximum period during which each Option may be exercised may be fixed by the
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Board at the time each Option is granted but shall in no event exceed ten (10)
years. Options for an aggregate of 1,154,000 shares of Common Stock at exercise
prices ranging from $0.15 to $0.625 were outstanding under the Plan as of April
30, 1999.
Included in the aggregate outstanding were options to purchase 40,000
shares at $.50 per share issued during the fiscal year ended April 30, 1999. No
options were exercised during the fiscal year. No options expired during the
fiscal year.
DIRECTORS' COMPENSATION AND SAR AWARDS
- --------------------------------------
Directors of the Company who are not also executive officers of the Company
receive an annual retainer of $12,000 plus $1,000 for each Board meeting they
attend. In addition, each director, other than Mr. Mendez, is granted the right
to receive a cash payment equal to the increase in value of 40,000 shares of the
Company's Common Stock from the date of their first election or appointment to
the Board, and payable upon, the earliest to occur of various qualifying events.
The Company may, at its sole option, defer payment for a maximum of 24 months
from the date of a valid notice of exercise of these rights. The Company
recorded a total liability of approximately $42,000 as of April 30, 1999 in
respect of these rights.
Concurrently with the execution of Mr. Mendez' Employment Agreement, and as
additional consideration thereunder, Mr. Mendez and the Company entered into a
stock appreciation rights agreement pursuant to which Mr. Mendez was granted the
right to receive, in cash, the appreciation value (the "Appreciation Rights")
with respect to 1,000,000 shares of Common Stock. The Appreciation Rights are
exercisable in pro rata installments over a five-year period and have initial
value prices ("base prices") as follows: 400,000 Appreciation Rights have a base
price of $.125 per share; 200,000 Appreciation Rights have a base price of $.25
per share; 200,000 Appreciation Rights have a base price of $.50 per share; and
200,000 Appreciation Rights have a base price of $.75 per share. The Company
recorded a total liability of approximately $192,000 as of April 30, 1999 in
respect of these rights.
EMPLOYMENT AGREEMENTS
- ---------------------
Mr. Mendez and the Company entered into an employment agreement (the
"Mendez Employment Agreement") which provides, among other things, that Mr.
Mendez, in consideration for his services as Chairman of the Board and Chief
Executive Officer of the Company, will be paid a base salary at the rate of
$200,000 per annum and incentive compensation equal to a percentage of the
annual earnings, before interest and taxes (as adjusted by the Board of
Directors for certain extraordinary and other non-recurring events and as more
fully described in the Mendez Employment Agreement)("Adjusted EBIT") of the
Company. Generally, Mr. Mendez will be entitled to receive an amount equal to 6%
of Adjusted EBIT if the Company's Adjusted EBIT for any fiscal year is between
$500,000 and $1 million and 8% of the Adjusted EBIT if the Company's Adjusted
EBIT for any fiscal year is greater than $1 million. In addition, Mr. Mendez is
entitled to participate, at no cost or expense to him, in all employee benefit
programs maintained by the Company to the extent that such programs are
available generally to executive officers, provided that the aggregate annual
value to Mr. Mendez of such benefits does not exceed $37,000. To the extent that
the aggregate value of such benefits does not exceed $37,000, Mr. Mendez may
elect to receive the differential in cash or applied to other fringe benefits of
his selection.
The Mendez Employment Agreement also provides that Mr. Mendez' employment
is terminated by him for "Good Reason"(as defined below) or by the Company
without Mr. Mendez' consent and without Cause (as defined in the Mendez
Employment Agreement) and not due to death or disability of Mr. Mendez, Mr.
Mendez shall be entitled to receive (in addition to continuation of his
executive benefits) his base salary for the greater of two full years from the
date of termination or the remainder of the Mendez Employment Agreement and
whatever incentive compensation he would otherwise been entitled to receive for
the fiscal year during which his employment is terminated. Good Reason is
defined as the occurrence, without Mr. Mendez' prior consent of (i) a reduction
in rank or an assignment of duties materially inconsistent with Mr. Mendez'
positions as Chairman of the Board and Chief Executive Officer of the Company,
without any substantial failure of Mr. Mendez to perform such duties properly
and effectively; (ii) a reduction by the Company in Mr. Mendez' annual base
salary or a material reduction or elimination of his perquisites of office or a
substantial reduction or elimination of his aggregate available employee
benefits as in effect at December 31, 1992 or as the same may be increased from
time to time; (iii) a change in the location at which Mr. Mendez' services are
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to be regularly performed to a location out of the 30-mile radius of the Empire
State Building, New York, New York, without a comparable change for other
executive officers of the Company, or any willful, material breach by the
Company of any provision of Mr. Mendez' Employment Agreement not cured within a
period of ten business days after receipt by the Company of written notice from
Mr. Mendez of his intention to resign for Good Reason because of such breach; or
(iv) the merger or consolidation of the Company with or into any other entity as
a result of which Mr. Mendez is reduced in rank or is assigned duties with the
surviving entity that are materially inconsistent with his then present
position(s) with the Company. In addition, the Mendez Employment Agreement
provides that in the event of termination of Mr. Mendez' employment thereunder
due to death or disability (as defined therein), the Company shall pay Mr.
Mendez (or his estate, as the case may be) his annual base salary for one year
following his termination of employment and whatever incentive compensation Mr.
Mendez would otherwise been entitled to receive for the fiscal year during which
his employment is terminated. The Mendez Employment Agreement expires on April
30, 2000.
The Mendez Employment Agreement acknowledges Mr. Mendez' beneficial
ownership and involvement in Multiplex and permits Mr. Mendez to devote
reasonable periods of time to the business of Multiplex, provided that his
involvement with Multiplex' business does not interfere with the performance of
his duties and obligations under the Mendez Employment Agreement and that Mr.
Mendez at all times complies with the guidelines for limiting conflicts of
interest between the Company and Multiplex as previously adopted by the Board of
Directors of the Company and accepted by Mr. Mendez.
The Company entered into an extension of an employment agreement with Mr.
Kogen effective May 1, 1999 and expiring April 30, 2000. In consideration of his
services as Executive Vice President and Chief Operating Officer of the Company,
Mr. Kogen (i) is to receive an annual salary of $155,000 effective May 1, 1999
and (ii) will receive a bonus based on the Operating Income of the Company. Mr.
Kogen's employment agreement also contains a six-month non-competition provision
following the term of the agreement or any extension thereof.
The Company entered into an extension of an employment agreement with Mr.
Sayour effective May 1, 1999 and expiring April 30, 2000. In consideration of
his services as Senior Vice President of the Company, Mr. Sayour (i) is to
receive an annual salary of $132,000 effective May 1, 1999 and (ii) will receive
a bonus based on the Operating Income of the Company. Mr. Sayour's employment
agreement also contains a six-month non-competition provision following the term
of the agreement or any extension thereof.
CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS
On June 21, 1995, the Company signed a Stock Purchase Agreement to purchase
1,072,988 shares of the Company's $.01 par Value Common Stock held by certain
members of the family of the late George May at $.45 per share. Terms of the
agreement provide for a cash payment in the amount of $174,448 and a five (5)
year note in the amount of $308,397 bearing interest at 12% per annum. Interest
is to be paid monthly. The principal is to be paid in five equal annual
installments of $61,679. The Company's obligation under the note is
collateralized by a pledge by the Company to the noteholder of 685,326 shares of
the Company's Common Stock.
This agreement was entered into because management believed it represented
a good value for the Company. Taking into consideration the Company's financial
condition and the thinly traded nature of the stock, management believes that
the price paid for the stock was reasonable. The Board of Directors secured a
fairness opinion from an independent investment banker supporting the fairness
of the transaction from the Company's point of view.
In September 1998, pursuant to an Option and Escrow Agreement, the Company
repurchased from the May family an additional 536,494 shares of Common Stock and
536,494 shares of its Class A Common Stock (which were retired) at an agreed
upon price of $.575 per share. A cash payment in the amount of $308,485 was paid
and five, five-year notes, in the cumulative amount of $308,485, bearing
interest at 11.5% per annum were issued. Principal payments on the notes will be
made in five equal, cumulative installments of $61,697. Interest on the notes is
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to be paid monthly. The notes are collateralized by the repurchased shares of
the Company's Common Stock which are held in escrow.
Multiplex Electrical Services, Inc. ("Multiplex"), which is owned by the
family of Paul Mendez, is one of 70 distributors of the LSN 2000. During the
fiscal year the Company had sales of approximately $184,000 to Multiplex. Sale
of the products to Multiplex was on the same terms as other distributors. The
Company also purchased approximately $55,000 of product and engineering services
from Multiplex. The Company believes the terms and conditions of such
transactions were fair and reasonable.
ANNUAL REPORT
All shareholders of record as of September 21, 1999 have either been sent
or are concurrently being sent a copy of the Company's 1999 Annual Report to
Shareholders for the fiscal year ended April 30, 1999 which contains audited
financial statements of the Company for the fiscal years ended April 30, 1999
and 1998.
SHAREHOLDERS PROPOSALS FOR 2000 ANNUAL MEETING
Shareholders who desire to submit proposals for inclusion in the Company's
proxy statement for the 2000 Annual Meeting of Shareholders of the Company must
submit such proposals to the Secretary of the Company at the Company's principal
office at 39-27 59th Street, Woodside, New York 11377 no later than April 27,
2000.
OTHER MATTERS
Pursuant to the Company's By-Laws, as amended, nominations or other
business may be properly brought before an annual meeting by a shareholder
provided that the shareholder gives timely notice thereof in writing to the
Secretary of the Company. To be timely, a shareholder's notice shall be
delivered to the Secretary at the principal executive offices of the Company not
less than sixty (60) days nor more than ninety (90) days prior to the first
anniversary of the preceding year's annual meeting; provided, however, that in
the event that the date of the annual meeting is advanced by more than thirty
(30) days or delayed by more than sixty (60) days from such anniversary date,
notice by the shareholder to be timely must be so delivered not earlier than the
ninetieth (90th) day prior to such annual meeting and not later than the close
of business on the later of the sixtieth (60th) day prior to such annual meeting
or the tenth (10th) day following the day on which public announcement of the
date of such meeting is first made.
As of the date of this Proxy Statement, the Board of Directors of the
Company does not know of any other matters to be brought before the Meeting
other than as set forth in this Proxy Statement and the time for such matters to
be presented by shareholders expired on July 11, 1999. However, if any other
matters not mentioned in the Proxy Statement are properly brought before the
Meeting or any adjournments thereof, the persons named in the enclosed Proxy or
their substitutes will have discretionary authority to vote proxies given in
said form, or otherwise act, in respect of such matters in accordance with their
best judgment.
The Company has selected Rothstein, Kass & Company, P.C., the Company's
auditors for the fiscal year ended April 30, 1999, to continue as independent
certified public accountants of the Company. Representatives of Rothstein, Kass
& Company, P.C. are expected to attend the Meeting and will be available to
respond to appropriate questions raised orally. Such representatives will also
be given an opportunity to make a statement if they so desire.
All of the costs and expenses in connection with the solicitation of
proxies will be borne by the Company. In addition to solicitation of proxies by
use of mails, directors, officers and employees (who will receive no
compensation therefor in addition to their regular remuneration) of the Company
may solicit the return of proxies by telephone, telegram or personal interview.
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It is important that proxies be returned promptly. Shareholders are,
therefore, urged to fill in, date, sign and return the Proxy immediately. No
postage need be affixed if mailed in the enclosed envelope in the United States.
BY ORDER OF THE BOARD OF DIRECTORS
PAUL MENDEZ
Chairman of the Board
September 23, 1999
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PROXY CARD
FIRECOM, INC.
ANNUAL MEETING OF SHAREHOLDERS - OCTOBER 20, 1999
The undersigned hereby appoints Paul Mendez and Howard L. Kogen, and each
of them, proxies with powers of substitution each, for and in the name of the
undersigned to vote all shares of stock of FIRECOM, INC., a New York corporation
(the "Company"), that the undersigned would be entitled to vote at the Company's
1999 Annual Meeting of Shareholders (the "Meeting"), and at any adjournments
thereof, upon the matters set forth in the Notice of Meeting as stated below,
hereby revoking any proxy heretofore given. In their discretion, the proxies are
further authorized to vote upon such other business as may properly come before
the Meeting.
The undersigned acknowledges receipt of the Notice of Meeting and the
accompanying Proxy Statement and Annual Report.
THIS PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS. THE BOARD RECOMMENDS A
VOTE "FOR" PROPOSAL 1.
1. Election of Class A Directors for all nominees listed below (except as
indicated).
| | FOR | | WITHHOLD AUTHORITY
-- --
The nominees of the Board of Directors are:
Paul Mendez, Peter Barotz and Richard G. Scurry, Jr.
INSTRUCTION: To withhold authority to vote for any individual nominee,
write the nominee's name on the space provided below:
This Proxy, when properly executed, will be voted in the manner directed
herein by the undersigned shareholder. If no direction is given, this Proxy,
when properly executed and returned, will be voted "FOR" the election of the
three named individuals as directors.
Dated:
----------------------------------
Signature
Name
PLEASE SIGN YOUR NAME EXACTLY AS IT APPEARS HEREON. IF THE STOCK IS REGISTERED
IN MORE THAN ONE NAME, EACH JOINT OWNER SHOULD SIGN PERSONALLY. WHEN SIGNING AS
ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN, GIVE YOUR FULL TITLE AS
IT APPEARS HEREON. ONLY AUTHORIZED OFFICERS SHOULD SIGN FOR A CORPORATION.
PLEASE SIGN, DATE AND MAIL THIS PROXY
IMMEDIATELY IN THE ENCLOSED ENVELOPE.
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