<PAGE> 1
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:
<TABLE>
<S> <C>
/X/ Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
NYTEST ENVIRONMENTAL, INC.
- --------------------------------------------------------------------------------
(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), or 14a-6(i)(1), or 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> 2
Nytest Environmental Inc.
60 Seaview Boulevard
Port Washington, New York 11050
--------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
--------
NOTICE IS HEREBY given that the Annual Meeting of the Stockholders of
Nytest Environmental Inc. (the "Company") will be held on June 25, 1996, 1996 at
10:00 A.M. at the Company's office located at 60 Seaview Boulevard, Port
Washington, New York 11050.
The meeting is being called for the following purposes:
1. To elect a board of directors.
2. To authorize an amendment to the Company's 1992 Stock Incentive Plan to
increase the number of shares of Common Stock which may be issued or
subject to options under such plan from 600,000 to 1,500,000 shares.
3. To authorize an amendment to the Company's Certificate of Incorporation
to increase the number of authorized shares of Common Stock, $.01 par
value from 10,000,000 to 30,000,000.
4. To ratify the selection of the Company's independent certified public
accountants for the year ending December 31, 1996.
5. To transact such other business as may properly come before the meeting
or any adjournment or adjournments thereof.
Stockholders of record at the close of business on May 1, 1996 are
entitled to notice of and to vote at this meeting. Sending in your proxy will
not prevent your attending and voting at the meeting in person should you later
decide to do so.
The accompanying form of proxy is solicited by the board of directors
of the Company. Reference is made to the enclosed proxy statement for further
information in respect to the business to be transacted at the meeting.
Please sign and date the enclosed proxy and mail it promptly in the
enclosed postage paid envelope so that your shares will be represented at the
meeting.
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<PAGE> 3
THE COMPANY URGES THAT AS MANY STOCKHOLDERS AS POSSIBLE BE REPRESENTED
AT THE MEETING. WHETHER OR NOT YOU NOW EXPECT TO BE PRESENT AT THE MEETING YOU
ARE URGED TO READ THE ATTACHED PROXY STATEMENT AND THEN FILL IN, DATE, SIGN AND
RETURN PROMPTLY THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE. IF YOU ARE PRESENT
IN PERSON AT THE MEETING, YOU MAY VOTE IN PERSON REGARDLESS OF HAVING SENT IN
YOUR PROXY. IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING AND
YOUR PROMPTNESS WILL ASSIST US IN PREPARATIONS FOR THE MEETING.
By order of the board of directors,
James W. Shearard, Jr., Secretary
Dated: May 1, 1996
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<PAGE> 4
Nytest Environmental Inc.
60 Seaview Boulevard
Port Washington, New York 11050
--------
PROXY STATEMENT
--------
This proxy statement is being furnished in connection with the
solicitation of proxies by the board of directors of Nytest Environmental Inc.
(the "Company") in connection with the annual meeting of stockholders of the
Company to be held June 23, 1996. This proxy statement and enclosed form of
proxy are first being mailed to the stockholders on May 24, 1996. Proxies will
be voted in accordance with the directions specified thereon and otherwise in
accordance with the judgment of the persons designated as proxies. Any proxy on
which no direction is specified will be voted in favor of the actions described
in this proxy statement. A proxy in the enclosed form may be revoked at any
time, prior to it being voted at the annual meeting by sending a subsequently
dated proxy or by giving written notice to the Company, in each case to the
attention of James W. Shearard, Jr., Secretary, at the address set forth above.
Stockholders who attend the meeting may withdraw their proxies at any time
before their shares are voted by voting their shares in person.
The expenses of the solicitation of proxies for the meeting, including
the cost of preparing, assembling and mailing the notice, proxy and proxy
statement, the handling and tabulation of proxies received and the charges of
brokerage houses and other institutions that are nominees or fiduciaries in
forwarding such documents of the proxy material to beneficial owners, will be
paid by the Company. In addition to the mailing of the proxy material, such
solicitation may be made in person or by telephone by directors, officers or
regular employees of the Company.
The matters to be considered at the annual meeting will be the election
of directors for the ensuing year. The Company is not aware of any other matter
to be presented for action at the meeting.
PROXIES ARE REVOCABLE AT ANY TIME PRIOR TO BEING VOTED EITHER BY
SENDING A SUBSEQUENTLY DATED PROXY OR BY WRITTEN NOTICE OF REVOCATION TO THE
SECRETARY OF THE COMPANY OR BY VOTING AT THE MEETING IN PERSON.
The mailing address of the principal executive offices of the Company
is 60 Seaview Boulevard, Port Washington, New York 11050. The Annual Report of
the Company for the fiscal year ended December 31, 1995, including financial
statements, supplementary financial
3
<PAGE> 5
information and management's discussion and analysis of financial condition and
results of operations, accompanies this proxy statement.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The by-laws of the Company provide that there will be not more than
nine directors. The board of directors has fixed the number of directors at five
and has nominated five persons to stand for election. These five directors will
be elected by the stockholders to serve until the next annual meeting of
stockholders and until their respective successors have been elected and
qualified. Proxies in the enclosed form will be voted for the nominees named
below. Authority may be withheld for any nominee. In addition, stockholders may
nominate additional nominees as candidates for the position as director.
Although the board of directors does not anticipate that any nominee will be
unavailable for election, in the event of such occurrence, the proxy will be
voted for such substitute, if any, as the board of directors may designate.
The nominees for directors, together with certain other information in
respect of such nominees, are as follows:
<TABLE>
<CAPTION>
Year first
associated with
Name Age Office Company
---- --- ------ -------
<S> <C> <C> <C>
John Gaspari 54 President, Chief Executive 1985
Officer and a Director
James W. Shearard, Jr. 44 Vice President - Marketing
and Sales, Secretary, Director 1992
Anthony P. Towell 65 Director 1988
Thomas E. Lent 45 Director 1991
Martin Fleisher, Ph.D. 60 Nominee N/A
</TABLE>
Mr. Gaspari has served as the Company's President, Chief Executive
Officer and a Director of the Company since April 1985.
Mr. Shearard has served as Director of Marketing and Sales since 1992
and was appointed Secretary and Director of the Company in October 1994. In
January 1995, he was appointed Vice President - Marketing and Sales. Prior to
joining the Company, Mr. Shearard had nearly twenty years of service in the
environmental testing industry, including serving as Vice President of TMS
Analytical Services from 1991 to 1992 and serving as National Sales Director for
the Analytical Sales Division of IT Corporation from 1989 to 1991.
4
<PAGE> 6
Mr. Towell has served as a Director of the Company since 1988 and
serves from time to time as a consultant. Mr. Towell is a Director of Ameridata
Technologies Inc. (formerly Sage Technologies, Inc.), having served in that
capacity since 1991. He has also served since 1989 as a Director and Chief
Financial Officer of Eastco Industrial Safety Corp., a manufacturer and
distributor of disposable clothing, industrial protective clothing and
protective products whose common stock is registered under Section 12(g) of the
Securities and Exchange Act of 1934.
Mr. Lent has served as a Director of the Company since November 1991
and is President of Trilogy Group, Inc., a private consulting firm, since
December 1993. From June 1991 to August 1995, Mr. Lent served as Managing
Director of Brenner Financial Management, a division of Brenner Securities,
having joined that company in June 1991. Brenner Financial Management advises
corporate and institutional clients in planning investment strategies for excess
cash reserves, renders corporate financial advice, business planning and
management services for small and middle market clients. Brenner Financial
Management also provides merchant banking analysis and small-cap stock research.
He served as an independent consultant for companies seeking investment
opportunities in Eastern Europe from January to June 1991. Mr. Lent was Managing
Director of Weatherly Capital Corporation, which engages in activities similar
to Brenner Financial Management from August 1989 to January 1991. Prior to
joining Weatherly Capital Corporation, Mr. Lent was a principal and executive
officer of MarketAmerica Group Inc., a registered investment advisor, from
February 1986 to August 1989, and served as President of MarketAmerica Trust, a
publicly held mutual fund, from August 1986 to December 1988. In those
capacities, he had principal responsibility for the administration,
organization, management and financing of the investment advisory and the
investment policy of its MarketAmerica Trust investment company.
Dr. Fleisher has served as an Assistant Professor of Medicine,
Sloan-Kettering Division, Cornell University Graduate School of Medical Sciences
since 1969 and since 1981 has served as Attending Clinical Chemist, Department
of Clinical Chemistry, Memorial Hospital for Cancer and Allied Diseases. In
1990, Dr. Fleisher became a member of Memorial Hospital - Memorial Sloan
Kettering Cancer Center. In addition to numerous research appointments and
adjunct professorships at New York University, City University and Columbia
University, Dr. Fleisher is a fellow of the National Academy of Clinical
Biochemists, the American Chemical Society and the New York Academy of Sciences.
He has also served as a consultant in Clinical Chemistry, Department of
Laboratories and Pathology, New Rochelle Hospital Medical Center (1992 to
present) and as a member of the Advisory Committee to the Bureau of Laboratories
for Clinical Chemistry, Endocrinology and Toxicology (1991 to present).
The term of office for all of the above nominees for directors will
expire at the next annual meeting of stockholders when their successors are duly
elected and qualified. The officers of the Company hold office at the will of
the board of directors, subject to rights contained in employment agreements.
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<PAGE> 7
PROPOSAL NO. 2
APPROVAL OF AN AMENDMENT TO THE
1992 EMPLOYEE STOCK INCENTIVE PLAN
On March 2, 1992, the Board of Directors of the Company adopted an
amendment to the Nytest Environmental Inc. 1992 Employee Stock Incentive Plan
(the "Incentive Plan") to increase the number of shares under the Incentive Plan
from 600,000 to 1,500,000 and directed that it be presented to the stockholders
for their approval and adoption. The Incentive Plan is administered by a Stock
Option Committee appointed by the Board of Directors and presently authorizes
the Stock Option Committee to grant or award to eligible participants of the
Company and its subsidiaries and affiliates, until June 8, 2002, stock options,
stock appreciation rights, restricted stock or deferred stock awards for up to
600,000 shares of the common stock of the Company. The members of the Stock
Option Committee are John Gaspari, Anthony P. Towell and Thomas E. Lent. As of
December 31, 1995, 366,400 shares were the subject of options under the
Incentive Plan
The following is a general description of certain features of the
Incentive Plan, as proposed to be amended.
1. Eligibility. Officers, directors and other key employees of the
Company, its subsidiaries and its affiliates who are responsible for the
management, growth and profitability of the business of the Company, its
subsidiaries and its affiliates are eligible to be granted stock options, stock
appreciation rights, and restricted or deferred stock awards under the Incentive
Plan.
2. Administration. The Incentive Plan is administered by the Stock
Option Committee of the Company. The Stock Option Committee has full power to
select, from among the employees eligible for awards, the individuals to whom
awards will be granted, to make any combination of awards to any participants
and to determine the specific terms of each grant, subject to the provisions of
the Incentive Plan.
3. Stock Options. The Incentive Plan permits the granting of
non-transferable stock options that are intended to qualify as incentive stock
options ("ISO's") under section 422 of the Internal Revenue Code of 1986 and
stock options that do not so qualify ("Non-Qualified Stock Options"). The option
exercise price for each share covered by an option shall be determined by the
Stock Option Committee but shall not be less than 100% of the fair market value
of a share on the date of grant. The term of each option will be fixed by the
Stock Option Committee, but may not exceed 10 years from the date of the grant
in the case of an ISO or 10 years and two days from the date of the grant in the
case of a Non-Qualified Stock Option.
4. Stock Appreciation Rights. Non-transferable stock appreciation
rights ("SAR's") may be granted in conjunction with options, entitling the
holder upon exercise to receive an amount in any combination of cash or
unrestricted common stock of the Company (as determined by the Stock Option
Committee), not greater in value than the increase since
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<PAGE> 8
the date of grant in the value of the shares covered by such right. Each SAR
will terminate upon the termination of the related option.
5. Restricted Stock. Restricted shares of the common stock may be
awarded by the Stock Option Committee subject to such conditions and
restrictions as they may determine, which may include the attainment of
performance goals. The Stock Option Committee shall also determine whether a
recipient of restricted shares will pay a purchase price per share or will
receive such restricted shares without, any payment in cash or property.
6. Deferred Stock. Deferred stock awards may also be made under the
Incentive Plan. These are non-transferable awards entitling the recipient to
receive common stock of the Company without any payment in cash or property in
one or more installments at a future date or dates, as determined by the Stock
Option Committee. Receipt of deferred stock may be conditioned on such matters
as the Stock Option Committee shall determine, including continued employment or
attainment of performance goals.
7. Loan Provisions. The Incentive Plan authorizes the Company, with the
consent of the Stock Option Committee, to make or arrange for loans to employees
in connection with the exercise of options or the payment of any purchase price
for restricted stock granted under the Incentive Plan or the payment of Federal
and State income taxes resulting from the granting or exercising of options or
other awards under the Incentive Plan. The Stock Option Committee has full
authority to decide whether to make such loans and to determine the term and
provisions of any such loans including interest charged and repayment terms.
8. Transfer Restrictions. Grants under the Plan are not transferable
except, in the event of death, by will or by the laws of descent and
distribution.
9. Termination of Benefits. In certain circumstances such as death,
disability, and termination without cause, beneficiaries in the Incentive Plan
may exercise Options, SAR's and receive the benefits of restricted stock grants
following their termination or their employment or tenure as a Director as the
case may be.
10. Change of Control. The Incentive Plan provides that (a) in the
event of a "Change of Control" (as defined in the Incentive Plan), unless
otherwise determined by the Stock Option Committee prior to such Change of
Control, or (b) to the extent expressly provided by the Stock Option Committee
at or after the time of grant, in the event of a "Potential Change of Control"
(as defined in the Incentive Plan), (i) all stock options and related SAR's (to
the extent outstanding for at least six months) will become immediately
exercisable: (ii) the restrictions and deferral limitations applicable to
outstanding restricted stock awards and deferred stock awards will lapse and the
shares in question will be fully vested: and (iii) the value of such options and
awards, to the extent determined by the Stock Option Committee, will be cashed
out on the basis of the highest price paid (or offered) during the preceding
60-day period, as determined by the Stock Option Committee. The Change of
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<PAGE> 9
Control and Potential Change of Control provisions may serve as a disincentive
or impediment to a prospective acquirer of the Company and, therefore, may
adversely affect the market price of the common stock of the Company.
REASONS FOR THE AMENDMENT
In the opinion of the board of directors, equity compensation is an
important and effective incentive for key employees and directors of the
Company. With the acquisition in August 1995 of the laboratory facility in
Norristown, PA from Smith Environmental Technologies, Inc. and the three
facilities located in Milford NH, Wichita, KS and Tampa FL from GTEL
Environmental Laboratories, the Company has increased its employees from
approximately 80 at December 31, 1994 to approximately 270 currently.
Accordingly, there is an increase in the number of management employees for whom
equity compensation would be effective incentive. The board of directors and
management believe that the availability of an additional 900,000 shares is
necessary to continue to attract and retain qualified personnel.
Furthermore, under the terms of the Executive Stock Option Plan adopted
in May 1991, the Company granted John Gaspari, Remo Gigante and Cleopatra
Guastella stock options to acquire an aggregate of 360,000 based on exercise
price of $.80. The options were to vest over a 5 year period beginning January
1, 1992 provided that the Company achieved certain earnings per share targets.
Ms. Guastella has retired from the Company and Mr. Gigante resigned his position
in November 1995. Neither received any options in accordance with the terms of
this plan. Furthermore, Mr. Gaspari has agreed to cancel his right to any
options under the terms of this plan. Accordingly, fewer of the Company's shares
are being held for issuance under the terms of the various incentive option
plans.
STOCKHOLDER VOTE REQUIRED
The affirmative vote of a majority of the shares present in person and
by proxy and voting at the meeting is required for the approval of the amendment
to the Incentive Plan.
The board of directors recommends a vote FOR the adoption of the
amended Incentive Plan to increase the number of shares available under the plan
from 600,000 to 1,500,000.
PROPOSAL NO. 3
AUTHORIZATION TO AMEND THE COMPANY'S CERTIFICATE OF
INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF
COMMON STOCK FROM 10,000,000 TO 30,000,000
In April, 1996 the board of directors of the Company adopted a proposal
declaring it advisable to amend the Certificate of Incorporation of the Company
to increase the number of shares of Common Stock from 10,000,000 to 30,000,000.
As of December 31, 1995 the Company had authorized 10,000,000 shares of Common
Stock, $.01 par value. As of that date,
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<PAGE> 10
there were issued and outstanding 6,705,230 shares of Common Stock and 1,620,881
shares of were reserved for issuance upon the exercise of outstanding options
and the conversion of outstanding convertible debt. After the amendment, only
28% rather than 83% of the authorized shares of Common Stock will be outstanding
and/or reserved for issuance upon the exercise of options and conversion of
securities and future issuances of shares of Common Stock, which may be made by
the Company's board of directors without further stockholder approval, may have
a dilutive effect on existing stockholders. Existing stockholders do not have
any pre-emptive or other rights to subscribe for additional shares of the
Company's Common Stock.
The increased number of shares of authorized Common Stock will be
available for issuance from time to time for such purposes and consideration as
the board of directors may approve and no further vote will be required, except
as provided under Delaware law or the rules of any exchange or quotation system
in which the Company's shares of Common Stock are then listed or included. The
availability of additional shares for issue, without the expense or delay of
obtaining the approval of stockholders, will afford the Company greater
flexibility in acting upon proposed transactions, including financing
transactions and acquisitions. The Company's management has engaged in
discussions with several parties concerning possible acquisitions and financing
transactions. Although no understandings or agreements have been reached
concerning such transactions, any such transactions, any such transactions may
involve the issuance of a substantial number of shares of Common Stock.
The Company currently has no plans or agreements to issue any
additional shares of Common Stock, other than the shares of Common Stock
previously reserved for issuance and pursuant to the Company's several stock
option plans, those reserved for issuance upon the exercise of options, warrants
and conversion of securities as described above. The additional shares of Common
Stock authorized would be available for issuance by the Company by action of the
board of directors and could be used for purposes which might be deemed to be in
defense of a potential takeover threat. The Company presently has no provisions
in its Certificate of Incorporation or By-laws which are designed to make a
potential takeover more difficult.
STOCKHOLDER VOTE REQUIRED
The affirmative vote of the holders of a majority of the shares of the
Company's outstanding Common Stock is required to amend the Company's
Certificate of Incorporation to authorize increase the number of authorized
shares of Common Stock from 10,000,000 to 30,000,000.
The board of directors recommends a vote FOR ratification of this
amendment.
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<PAGE> 11
PROPOSAL NO. 4
TO RATIFY THE SELECTION OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
The board of directors has recommended that Cornick, Garber & Sandler,
L.L.P., be retained as the Company's independent certified public accountants
for the fiscal year ending December 31, 1996. Although this recommendation is
not required to be submitted to a vote of stockholders, the board of directors
believes it appropriate as a matter of policy that this recommendation be
submitted for ratification at the Company's annual meeting. In the event the
stockholders do not ratify the retention of Cornick, Garber & Sandler, L.L.P.,
the selection of other independent auditors will be considered by the board of
directors.
STOCKHOLDER VOTE REQUIRED
The affirmative vote of the holders of a majority of the shares present
in person and by Proxy and voting at the meeting is required for ratification of
the selection of independent certified public accountant's.
The board of directors recommends a vote FOR ratification of the
selection of Cornick, Garber & Sandler, L.L.P.
OUTSTANDING VOTING SECURITIES AND VOTING RIGHTS
Holders of common stock at the close of business on May 1, 1996 are
entitled to vote. Each share of common stock entitles the holder to one vote on
each matter to be voted upon. A majority of the outstanding shares will
constitute a quorum at the meeting. Abstentions and broker non-votes are counted
for purposes of determining the presence or absence of a quorum for the
transaction of business. 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. As of
May 1, 1996, there were 6,705,230 outstanding shares of Common Stock, par value
$.01, which is the only class of stock outstanding.
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<PAGE> 12
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of May 1, 1996, the number and
percentage of shares of Common Stock of the Company, owned of record and
beneficially, by each person known by the Company to own 5% or more of such
stock, each nominee and director of the Company and by all officers and
directors, as a group:
<TABLE>
<CAPTION>
Approximate Approximate
Number of Percent of
Name Shares (1) Class (2)
- ---- ---------- ---------
<S> <C> <C>
John Gaspari 255,862(3) 3.7%
(Director and Nominee)
Anthony P. Towell 237,500(4) 3.5%
(Director and Nominee)
Thomas E. Lent 119,000(5) 1.7%
(Director and Nominee)
James W. Shearard, Jr. 51,900(6) 0.8%
(Director and Nominee)
Martin Fleisher -0- -0-
(Nominee)
Officers and 707,262(7) 9.9%
Directors as a
Group (7 Persons)
</TABLE>
- -----
(1) Information with respect to beneficial ownership is based upon
information furnished by each stockholder or contained in filings made
with the Securities and Exchange Commission. Unless otherwise
indicated, beneficial ownership includes both sole investment and
voting power.
(2) Based upon 6,705,230 shares of Common Stock outstanding as of May 1,
1996 and, with respect to each stockholder, the number of shares which
would be outstanding upon the exercise by such stockholder of
outstanding options to acquire stock.
(3) Includes an aggregate of 137,500 options granted pursuant to the
Company's Incentive Stock Option Plan and 1992 Employee Stock Incentive
Plan.
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<PAGE> 13
(4) Includes options granted under written agreement dated May, 1988 for
70,000 shares at $1.109375 per share exercisable currently and until he
is no longer a director and 62,500 options granted under the Company's
1992 Employee Stock Incentive Plan.
(5) Includes 112,500 options granted under the Company' s 1992 Employee
Stock Incentive Plan.
(6) Includes 13,900 options granted pursuant to the Company' s 1992
Employee Stock Incentive Plan.
(7) Includes a total of 426,400 shares which may be obtained by officers
and directors upon the exercise of outstanding options. Does not
include 120,000 options granted under the 1991 Executive Stock Option
Plan, which do not, by their terms, vest until the Company meets
certain financial performance goals, beginning in 1992.
The business address of Messrs. Gaspari and Shearard are Nytest
Environmental Inc. Mr. Towell's business address is c/o Eastco Industrial, 130
West 10th Street, Huntington Station, NY 11746. Mr. Lent's business address is
216 Massachusetts Street, Westfield, NJ 07090. Dr. Fleisher's business address
is Memorial Hospital for Cancer & Allied Diseases, 1275 York Avenue, New York,
NY 10021.
INFORMATION CONCERNING BOARD OF DIRECTORS AND COMMITTEES
During the year ended December 31, 1995, the board of directors met
nine times. The board adopted a policy of paying each non-management director
attendance fees of $2,500 per year. An aggregate of $4,875 was paid to
non-management directors during the year ended December 31, 1995. In addition,
the board has a policy of paying an additional $1,500 to each director serving
on committees.
The board has a standing Audit Committee. The Audit Committee in
general, reviews management's recommendations to the board of directors with
respect to the selection of a firm of independent certified public accountants
to conduct the annual examination of the Company's financial statements; reviews
with such firm the scope and results of the annual examination; reviews the
performance of such firm; consults with such firm with regard to the adequacy of
the Company's system of internal accounting controls; and reviews the
performance of the Company's internal audit function. The Company's independent
certified public accountants are invited to attend meetings of the Audit
Committee, and members of management may also be invited to attend. The Audit
Committee also considers questions of possible conflicts of interest as such
questions arise. The Audit Committee met four times during the year ended
December 31, 1995.
The Audit Committee's current members are John Gaspari, Anthony P.
Towell and Thomas E. Lent.
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<PAGE> 14
The board constituted a Nominating Committee for the selection of
management's nominees for election as directors in March 1994. The current
members of the Nominating Committee are John Gaspari, Anthony P. Towell and
Thomas E. Lent.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
The following table sets forth certain summary information regarding
the compensation of the Company's Chief Executive Officer and each of its other
executive officers whose total salary and bonus for the fiscal year ended
December 31, 1995, exceeded $100,000:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Name and Year Other Restricted All Other
Principal Ended Annual Stock Options/ LTIP Compen-
Position Nov. 30, Salary (1) Bonus Compensation Awards SARs Payouts sation
- -------- -------- ---------- ----- ------------ ------ ---- ------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
John Gaspari, 1995 $131,905 $-0- $-0- $-0- 22,500/0 $-0- $ 6,717
President and 1994 137,275 -0- -0- $-0- 5,000/0 -0- 6,717
Chief Executive 1993 164,477 -0- -0- -0- 10,000/0 -0- 6,957
Officer
Remo Gigante, 1995 $109,921 $-0- $-0- $-0- 50,000/0(4) $-0- $ 5,219
Senior Vice 1994 114,396 -0- -0- -0- 5,000/0 -0- 5,219
President in 1993 136,536 -0- -0- -0- 10,000/0 -0- 5,287
charge of
operations(2)(3)
All executive 1995 $400,656 $-0- $-0- $-0- 82,500/0(4) $-0- $ 11,936
officers as a 1994 424,862 -0- -0- -0- 92,900/0 -0- 18,536
a group 1993 399,699 -0- -0- -0- 30,000/0 -0- 18,188
(4 persons) (3)
</TABLE>
- -----
(1) Includes payment for unused vacation time in 1993 and 1994.
(2) Resigned, effective November 7, 1995
(3) Includes compensation paid to Remo Gigante through November 7, 1995.
(4) Includes 50,000 options granted to Remo Gigante in exchange for the
cancellation of a larger number of existing options upon his resignation
as an officer and director
EMPLOYMENT AGREEMENTS AND PLANS
John Gaspari has an employment agreement with the Company which was
amended and extended in May 1991. The agreement is for a term of five years
ending July 2, 1996. Mr. Gaspari is entitled to annual increases of 10%,
provided that the Company had a positive net income for the preceding fiscal
year, or annual increases limited to the increase in the Consumer Price Index,
if the Company had a negative net income for said period. For the year ended
December 31, 1994, the officers agreed to a 15% reduction in base salary
beginning February 1, 1993. The officers waived cost of living increases for
fiscal 1994 and accepted an additional
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<PAGE> 15
10% reduction in pay beginning March 7, 1994. Mr. Gaspari is also entitled to
share in a bonus fund equal to 4% of the Company's net income before taxes
during the preceding fiscal year, as well as disability income and life
insurance. Mr. Gaspari's agreement contains a "golden parachute" entitling him
to a lump sum severance payment in the event of a "change of control" of the
Company (as defined in the agreement), in cash equal to three times the average
annual compensation paid to him during the most recent five taxable years he
rendered full time services to the Company to the extent deductible to the
Company pursuant to the Internal Revenue Code of 1986 (the "Code").
On November 2, 1992, James W. Shearard, Jr. entered into a three year
employment agreement with the Company for the period ending December 31, 1995.
The agreement provides for a base salary of $97,000 with annual bonuses which
are based upon meeting or exceeding certain goals based upon the Company's gross
revenues. Mr. Shearard has not received any bonuses for the years ended December
31, 1993, 1994 and 1995. The agreement also provides for benefits available to
the Company's executive officers for a car allowance, and restricts the ability
of Mr. Shearard to compete with the Company for a period of up to one year after
his employment is terminated. In April 1993, Mr. Shearard agreed to a 5%
reduction in his base salary under the agreement and agreed to additional 10%
reduction in March 1994.
The Company adopted a Savings and Protection Plan (the "Plan") for
eligible employees pursuant to Section 401(k) of the Code, effective as of
September 1, 1988. Participating employees may contribute not less than 2% nor
more than 15% of their total taxable income to the Plan (subject to limits
imposed by the Code).
The Company may, at its discretion, make a matching contribution to the
Plan, which will be allocated proportionately among the participating employees'
accounts based on their contribution. For the year ended December 31, 1995 the
Company did not make contributions to the Plan. The Company's matching
contributions to the Plan are tax-deferred to the employees. Individual
participants select from investments available under a program available through
Equitable Life Assurance Society. Interests in the Plan vest in accordance with
years of service to the Company, from 0% with no more than one year of service,
and increasing by 33-1/3% per year until an employee becomes 100% vested upon
three years of service, except that interests are fully vested if an employee
dies while employed by the Company.
INCENTIVE STOCK OPTION PLAN
On April 26, 1988 the board of directors approved an Incentive Stock
Option Plan (the "Incentive Stock Option Plan") under Section 422A of the Code
which was approved by the stockholders on July 28, 1988. A total of 350,000 are
authorized to be issued and were granted under the Stock Option Plan.
Eligibility to participate in the Incentive Stock Option Plan is
limited to key employees of the Company. The term of an option will not exceed
ten years. Options will not be transferable except upon the death of a key
employee and, in such event, transferability will be effected by
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<PAGE> 16
will or by the laws of descent and distribution. Options may not be granted at
less than 100% of fair market value at the time of grant. The aggregate market
value of common stock for which options are exercisable for the first time
during any calendar year by an individual is limited to $100,000, but the value
may exceed $100,000 for which options may be granted. For purposes of the
Incentive Stock Option Plan, fair market value is the last reported asked price
for the Company's common stock as quoted by NASDAQ. No disposition of common
stock received upon exercise of options shall be made within two years from the
date of grant of the option or within one year after exercise. Options may not
be exercised unless, at the time of exercise, the employee shall be employed by
the Company and shall have completed at least 12 months of continuous employment
with the Company from the date of grant. The Incentive Stock Option Plan
provides that the payment of the exercise price of options under the Incentive
Stock Option Plan shall be made in cash.
Options may not be granted under the Stock Option Plan after April 25,
1998. In the event of any future recapitalization, reclassification, split-up or
consolidation of shares, the number of shares and exercise price shall be
equitably adjusted by the board of directors.
No options were granted to or exercised by executive officers under the
Incentive Stock Option Plan during the year ended December 31, 1995.
1992 EMPLOYEE STOCK INCENTIVE PLAN
On March 2, 1992, the board of directors of the Company adopted the
Nytest Environmental Inc. 1992 Employee Stock Incentive Plan (the "Incentive
Plan") and the Incentive Plan was approved by stockholders on June 8, 1992.
Proposal No. 2 includes a proposal to amend the Incentive Plan to increase the
number of shares available under the Plan from 600,000 to 1,500,000. A general
description of the Incentive Plan is set forth under "Proposal No. 2."
OPTIONS GRANTED IN 1995
The following table sets forth, as to each executive officer of the
Company listed in the Summary Compensation table, certain information concerning
options granted or exercised pursuant to the Incentive Stock Option Plan, the
Executive Stock Option Plan and the Employee Stock Incentive Plan during the
year ended December 31, 1995.
15
<PAGE> 17
<TABLE>
<CAPTION>
% of Total
Options/SARs
Options/ Granted to
SARs Employees in Exercise or Base Expiration
Name Granted Fiscal Year Price Per Share Date
- ---- ------- ----------- --------------- ----
<S> <C> <C> <C> <C>
John Gaspari 22,500/0 27%/0 $0.32/0 7/27/05
Remo Gigante 50,000/0 61%/0 1.00/0 11/7/00
</TABLE>
The following table sets forth, as to each executive officer listed in
the Summary Compensation table, certain information concerning the exercise of
options during the year ended December 31, 1995 and options outstanding as of
such date:
<TABLE>
<CAPTION>
Value of
Number of Unexercised
Unexercised in-the-Money
Shares Options Options
Acquired on Exercisable/ Exercisable/
Name Exercise Value Realized Unexercisable Unexercisable
- ---- -------- -------------- ------------- -------------
<S> <C> <C> <C> <C>
John Gaspari -0- -0- 137,500/0 $4,800/0
Remo Gigante -0- -0- 50,000/0 0/0
</TABLE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
It is the Company's policy not to engage in transactions with officers,
directors, principal stockholders or affiliates of any of them unless such
transactions have been approved by a majority of the disinterested directors and
are upon terms no less favorable to the Company than could be obtained from an
unaffiliated third party in an arm's length transaction. Such matters are
submitted to the Audit Committee of the board.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of the a registered class of the Company's equity securities to file
with the Securities and Exchange Commission initial reports of ownership and
reports of changes of ownership of Common Stock and other equity securities of
the Company.
To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and written representations that no other
reports were required during the year ended December 31, 1995 all Section 16(a)
filing requirements applicable to its officers, directors and greater than ten
percent beneficial owners were complied with, except that Remo Gigante, who is
no longer an officer or director of the Company filed one report eight months
late.
16
<PAGE> 18
PROCEDURE FOR SUBMISSION OF 1997 STOCKHOLDER PROPOSALS
Proposals by stockholders for inclusion in the 1997 annual meeting
proxy statement must be received by Nytest Environmental Inc. at 60 Seaview
Boulevard, Port Washington, New York 11050, Attention: James W. Shearard, Jr.,
Secretary, prior to January 1, 1997. All such proposals are subject to the
applicable rules and requirements of the Securities and Exchange Commission.
ANNUAL REPORT
The Company's Annual Report for 1995 is enclosed herewith.
A COPY OF THE COMPANY'S FORM 10-KSB ANNUAL REPORT TO THE SECURITIES AND
EXCHANGE COMMISSION, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO,
MAY BE OBTAINED WITHOUT CHARGE BY WRITING TO:
Nytest Environmental Inc.
60 Seaview Boulevard
Port Washington, New York 11050
Att: Chief Financial Officer
FINANCIAL AND OTHER INFORMATION
The following information is incorporated herein by reference to the
Company's Annual report for its fiscal year ended December 31, 1995, a copy of
which is included herewith:
Information Page No.
Audited Consolidated Financial Statements of the Company
Management's Discussion and Analysis of Financial Condition
and Results of Operations
The following information is incorporated herein by reference to the
Company's quarterly report on Form 10-QSB for the period ended March 31, 1996 a
copy of which is included herewith:
Information Page No.
Consolidated Financial Statement of the Company
Management's Discussion and Analysis of Financial Condition
and Results of Operations
17
<PAGE> 19
OTHER BUSINESS
There is no matter other than those described above, so far as is known
to the management of the Company, at the date of this proxy statement to be
acted on at the meeting. It is intended, however, if other matters come up for
action at the meeting or adjournments thereof, that the persons named in the
enclosed proxy shall, in accordance with the terms of the proxy, have authority
in their discretion to vote shares represented by proxies received by them, in
regard to such other matters, as seems to said persons in the best interests of
the Company and its stockholders.
Nytest Environmental Inc.
James W. Shearard, Jr., Secretary
18
<PAGE> 20
PRELIMINARY
0-15241
[CARD FRONT]
NYTEST ENVIRONMENTAL INC.
60 SEAVIEW BOULEVARD
PORT WASHINGTON, NEW YORK 11050
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
The undersigned hereby appoints John Gaspari and James W. Shearard, Jr., and
each or either of them (with power of substitution) as proxies for the
undersigned, to vote all shares of Common Stock of record on May 1, 1996 of
NYTEST ENVIRONMENTAL INC. which the undersigned would be entitled to vote if
personally present at the Annual Meeting of Stockholders to be held on June 23,
1996 at 10:00 A.M. local time, or at any adjournment thereof, upon the matters
set forth in the Notice of and Proxy Statement for said Meeting, copies of which
have been received by the undersigned, and in their discretion, upon all other
matters which may properly come before said Meeting. Without otherwise limiting
the generality of the foregoing, said proxies are directed to vote as follows:
The board of directors recommends a vote for:
NO. 1 ELECTION OF DIRECTORS
John Gaspari, James W. Shearard, Jr., Anthony P. Towell, Thomas E.
Lent and Martin E. Fleisher, Ph.D..
( ) FOR all nominees listed (except as withheld in the space below).
( ) WITHHOLD AUTHORITY to vote for all nominees listed above.
(Instruction: To withhold authority to vote for any individual
nominee write that nominee's name in the space provided below).
NO. 2 TO AUTHORIZE AN AMENDMENT TO THE COMPANY'S 1992 STOCK INCENTIVE PLAN
Proposal to amend the Company's 1992 Stock Incentive Plan to increase
the number of shares whichmay be issued or subjet to options under
the plan from 600,000 to 1,500,000.
( ) FOR ( ) AGAINST ( ) ABSTAIN
NO. 3 TO AUTHORIZE AN AMENDMENT TO THE COMPANY'S CERTIFICATE OF
INCORPORATION
Proposal to amend the Company's certificate of incorporation to
increase the number of authorized shares of common stock from
10,000,000 to 30,000,000.
( ) FOR ( ) AGAINST ( ) ABSTAIN
NO. 4 RATIFICATION OF THE SELECTION OF INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS
Proposal to ratify the appointment of Cornick, Garber & Sandler,
L.L.P. as the independent public accountants to examine the financial
statements of the Company for the fiscal year 1995.
( ) FOR ( ) AGAINST ( ) ABSTAIN
NO. 5 In their discretion, the proxies are authorized to vote upon such
other business as may properly come before the meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED BY THE UNDERSIGNED.
IF NO CONTRARY DIRECTION IS GIVEN ABOVE, AND THIS PROXY IS PROPERLY SIGNED, THE
SHARES WILL BE VOTED FOR THE PROPOSALS LISTED ABOVE.
<PAGE> 21
[CARD BACK]
Your proxy is important to assume a quorum at the meeting whether or not you
plan to attend the meeting in person. You may revoke this proxy at any time and
the giving of it will not affect your right to attend and vote in person.
Dated _______________________________, 1996
___________________________________________
Signature
___________________________________________
Signature (if held jointly)
THIS PROXY MUST BE SIGNED EXACTLY AS NAME
APPEARS. WHEN SHARES ARE HELD BY JOINT
TENANTS, BOTH SHOULD SIGN. WHEN SIGNING AS
ATTORNEY OR AS TRUSTEE, EXECUTOR OR
GUARDIAN, PLEASE GIVE FULL TITLE AS SUCH.
IF A CORPORATION, PLEASE SIGN IN FULL
CORPORATE NAME BY PRESIDENT OR OTHER
AUTHORIZED OFFICER. IF A PARTNERSHIP,
PLEASE SIGN IN PARTNERSHIP NAME BY
AUTHORIZED PERSON.
PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY CARD PROMPTLY, USING THE ENCLOSED
ENVELOPE.
