<PAGE> 1
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
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material pursuant to Rule 14a-11(c) or Rule 14a-12
PARTECH HOLDINGS CORPORATION
(Name of Registrant as Specified In Its Charter)
PARTECH HOLDINGS CORPORATION
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ X ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
[ ] $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: _/
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4) Proposed maximum aggregate value of transaction:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
_/ Set forth the amount on which the filing fee is calculated and state how
it was determined.
[ X ] 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:
$125.00
2) Form, Schedule or Registration Statement No.:
Preliminary Proxy Statement, filed on Schedule 14A
3) Filing Party:
Registrant
4) Date Filed:
August 22, 1994
<PAGE> 2
PARTECH HOLDINGS CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 9, 1994
To our Stockholders:
The directors and officers of Partech Holdings Corporation cordially
invite you to attend the 1994 Annual Meeting of Stockholders to be held at 3366
Riverside Drive, Suite 200, Columbus, Ohio, 43221, at 10:00 a.m., on Friday,
December 9, 1994, for the following purposes:
1. To elect two directors to the Board of Directors;
2. To approve an amendment to the Company's Certificate of
Incorporation to increase the number of Preferred Shares the Company
is authorized to issue;
3. To ratify the selection of Hausser + Taylor as independent certified
public accountants;
4. To transact such other business as may properly come before the
meeting.
The Board of Directors has fixed the close of business on October 13, 1994
as the record date for the determination of stockholders entitled to receive
notice of, and to vote at the Annual Meeting or any adjournment thereof. Only
stockholders of record at the close of business on October 13, 1994 are
entitled to vote at the Annual Meeting.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE THE
ENCLOSED PROXY CARD, AND SIGN, DATE AND PROMPTLY RETURN IT IN THE ENCLOSED
ENVELOPE SO YOUR SHARES WILL BE REPRESENTED. SENDING IN YOUR PROXY WILL NOT
PREVENT YOU FROM VOTING IN PERSON AT THE ANNUAL MEETING.
Your attention is directed to the attached Proxy Statement.
PARTECH HOLDINGS CORPORATION
/s/ JOHN E. RAYL
John E. Rayl
Chairman of the Board and
Chief Executive Officer
October 27, 1994
Page 2
<PAGE> 3
PARTECH HOLDINGS CORPORATION
3366 RIVERSIDE DRIVE, SUITE 200
COLUMBUS, OHIO 43221
(614) 538-0660
________________________
PROXY STATEMENT
________________________
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Partech Holdings Corporation (the "Company" or
"Partech") of proxies to be voted at the Annual Meeting of Shareholders to be
held on December 9, 1994. The Proxy Statement was mailed on or about October
27, 1994 to stockholders of record at the close of business on October 13, 1994
(the "Record Date"). Only stockholders of record on the Record Date will be
entitled to vote at the Annual Meeting.
The cost of approximately $5,500 for solicitation of proxies will be borne
by the Company. As of the date of this Proxy Statement, approximately $1,000
have been spent for the solicitation hereof. In addition to solicitation by
mail, officers and employees of the Company, without additional compensation,
may solicit proxies by telephone or in person. The annual report to
stockholders for fiscal 1994, which includes financial statements, has been
mailed with this Proxy Statement or was previously delivered to stockholders
and does not form a part of the material for the solicitation of proxies unless
specifically incorporated by reference hereinafter. If, upon receipt of your
proxy material, you have not received the annual report, please write or call
the Company's Shareholder Relations Department at the address or phone number
listed above.
Since many stockholders cannot personally attend, it is necessary that a
large number be represented by proxy. The holders of record of one-third of
the outstanding shares of Common Stock must be present in person or represented
by proxy at the Annual Meeting in order to establish a quorum to hold the
Annual Meeting. The Company's By-Laws require an affirmative vote of the
holders of a majority of the shares of Common Stock present in person or by
proxy and entitled to vote for approval of the items listed on the proxy card,
which are described hereinafter.
Abstentions and broker non-votes (which arise from proxies delivered by
brokers and others, where the holder of record has not received authority to
vote on one or more of the matters) are each included in the determination of
the number of shares present at the Annual Meeting in order to establish a
quorum. For purposes of determining whether a proposal is passed, abstentions
are counted in tabulations of votes cast on proposals presented to shareholders
and have the effect of a vote against the proposal. For purposes of
determining whether a proposal is passed, broker non-votes are not counted in
tabulations of votes cast on proposals presented to shareholders and have no
effect on the vote of the proposal.
The Board of Directors requests that all stockholders complete the enclosed
proxy card, and sign, date and return it as promptly as possible. Any
stockholder giving a proxy will have the right to revoke it at any time prior
to the time it is voted. A proxy may be revoked by written notice to the
Company, execution of a subsequent proxy, or attendance at the Annual Meeting
and voting in person. Attendance at the Annual Meeting will not automatically
revoke the proxy. All shares represented by properly executed and unrevoked
proxies received in the accompanying form in time for the Annual Meeting will
be voted at the Annual Meeting or at any adjournment thereof. Confirmation of
stock ownership will be made prior to admission to the Annual Meeting.
Page 3
<PAGE> 4
DIRECTORS, EXECUTIVE OFFICERS AND FAMILY RELATIONSHIPS
ELECTION OF DIRECTORS (PROXY ITEM #1)
The Board of Directors has designated the following nominees for election
as Directors of the Company to serve for the following term and until his
respective successor is duly elected and qualified. Mr. Jerald K. Rayl and Mr.
Thomas E. Reynolds were reelected January 24, 1994 for terms to expire
December, 1996 and December, 1995, respectively.
NOMINEES
<TABLE>
<CAPTION>
DIRECTOR TERM TO
NAME AGE POSITION SINCE EXPIRE
----------------- ---- ------------------------------ ----------- -------------
<S> <C> <C> <C> <C>
John E. Rayl (a)(e) 46 Director, Chief Executive Officer,
President and Treasurer March, 1985 December, 1997
Jerald K. Rayl (b)(e) 43 Director December, 1992 December, 1996
Thomas E. Reynolds (d) 48 Director, Vice President, Secretary
and Assistant Treasurer August, 1991 December, 1995
James B. Dwyer III (e) 51 Director May, 1994 December, 1997
____________________
<FN>
(a) JOHN E. RAYL serves as Chairman of the Board, Chief Executive Officer,
President, and Treasurer of the Company and each of its subsidiaries. In
addition, Mr. Rayl is a General Partner in the Company's nine real estate
partnerships and a Co-Trustee of all of the Company's Ohio business trusts.
He is an Ohio certified public accountant holding both a Bachelors (1969)
and a Masters (1977) Degree in Business Administration from Capital
University, Columbus, Ohio and served with the United States Army in
1970-1971 in Frankfurt, Germany. Mr. Rayl has devoted his business efforts
to the development of Leeward Capital Corporation ("Leeward"), which is the
principal operating subsidiary of the Company, since its formation in
October, 1980. For the twelve years prior to founding Leeward, Mr. Rayl
was a certified public accountant with the Columbus, Ohio office of Coopers
& Lybrand where he held the position of Tax Manager. Mr. Rayl is the
Company's representative with the National Association of Broadcasters, and
with the American Association of Equipment Lessors. Mr. Rayl was appointed
a Director and Chief Executive Officer of the Company in March, 1985 and
has been a Director and Chief Executive Officer of Leeward since its
founding.
(b) REVEREND JERALD K. RAYL was appointed to fill an existing vacancy as a
director of the Company in December, 1992 and has been elected to a term
to expire in December, 1996. Rev. Rayl is a graduate of Capital University
where he received his Bachelors Degree (1973) and Trinity Lutheran Seminary
in Columbus, Ohio where he received his Masters Degree (1977). Rev. Rayl
served Lutheran churches in Baltimore, Maryland (1976), Maysville, Kentucky
(1977-1980), and Brookville, Ohio (1980-1990). He presently serves as
Director of Development and Chaplain of The Wernle Children's Home,
Richmond, Indiana.
(c) THOMAS E. REYNOLDS, Director, Vice-President, Secretary, and Assistant
Treasurer of the Company, joined the Company in May, 1991 and was appointed
to the Board of Directors in August, 1991 to fill an existing vacancy and
has been elected to a term to expire in December, 1995. Prior to joining
Partech, Mr. Reynolds served as a consultant, corporate director, and
officer in a number of entrepreneurial ventures in the food service
business, a full service computer consulting firm, and the oil and gas
industry. Mr. Reynolds, an Ohio certified public accountant, was with the
Columbus, Ohio office of Coopers & Lybrand from 1973 to 1980. Mr. Reynolds
holds a Bachelors of Science Degree in Business Administration (1972) from
The Ohio State University and served as a commissioned officer with the
United States Army from 1965 to 1969. Mr. Reynolds is a Co-Trustee of all
of the Company's Ohio business trusts.
(d) JAMES B. DWYER III, was one of the founders of the M&A Department of
Kidder, Peabody, and founded and headed M&A departments for two investment
banking firms: Loeb, Rhoades & Co. and UBS Securities, Inc. (the U.S.
investment banking firm of The Union Bank of Switzerland) and also was a
senior M&A officer at
Page 4
<PAGE> 5
Donaldson Lufkin & Jenrette. Mr. Dwyer is a past president and on the
Board of Advisors of the Association for Corporate Growth, the largest
international association of M&A Professionals with approximately 3,000
members, and a past president of the Columbia Business School Alumni
Association where he received an MBA in Finance in 1970. In 1965 he
graduated with a BBA in Accounting from the University of Notre Dame. Mr.
Dwyer became a CPA in 1968 while working for three years with Touche, Ross
& Co.
(e) John E. Rayl and Jerald K. Rayl are brothers.
</TABLE>
COMMITTEES OF DIRECTORS
The Board of Directors has established a Compensation Committee (the
"Committee"). The Committee is comprised of Messrs. John E. Rayl and Thomas E.
Reynolds and was established to administer the compensation programs, including
the granting of stock options. The Board of Directors' Audit Committee is
comprised of Messrs. John E. Rayl and James B. Dwyer III. The Company does not
maintain a standing nominating or any other committee performing similar
functions. During the fiscal year ended April 30, 1994, the Board of Directors
of the Company met on one occasion. Each of the nominees attended all of the
meetings of the Board of Directors during the period in which each served as a
Director.
EXECUTIVE OFFICERS
The following table lists additional information for executive officers
(see "Election of Directors" for more information as to executive officers).
<TABLE>
<CAPTION>
EXECUTIVE
OFFICER TERM TO
NAME AGE POSITION SINCE EXPIRE
----------------- ---- ------------------------------ ----------- -------------
<S> <C> <C> <C> <C>
Paul R. Weinberger (a) 35 Vice President, Controller and
Assistant Treasurer August , 1991 December, 1995
____________________
<FN>
(a) PAUL R. WEINBERGER, Vice President, Controller and Assistant Treasurer, has
been employed by the Company since March, 1988, and was appointed an
officer of the Company in August, 1991 (previously serving as an officer of
Leeward and LCC Leasing International, Inc. since November, 1990). Mr.
Weinberger is responsible for the Company's Securities and Exchange
Commission and financial reporting, and financial and treasury management.
Mr. Weinberger served as Treasurer and a member of the Board of Directors
of the Pathseekers Foundation, Columbus, Ohio (1990-1992), and has been
employed by Northern Telecom Limited, Children's Hospital, Columbus, Ohio,
and Interline Communications Services, Inc. Mr. Weinberger holds a
Bachelors of Science Degree in Accounting (1987) from Franklin University,
Columbus, Ohio.
</TABLE>
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
VOTING RIGHTS
As of the Record Date there were 1,859,902 shares of Common Stock
outstanding. Stockholders are entitled to one vote for each share held of
record on each matter of business to be considered at the Annual Meeting. No
stockholder is entitled to cumulative voting at the Annual Meeting or any
adjournment thereof. A Stockholder's shares may be voted at the Annual Meeting
only if the stockholder is present in person or by valid proxy granted to
another person attending the Annual Meeting in the stockholder's stead.
Page 5
<PAGE> 6
<TABLE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of August 18, 1994, the number and
percentage of outstanding shares of Common Stock beneficially owned by all
persons known by the Company to be the owners of more than 5% of the
outstanding shares of Common Stock and the shares owned by all directors and
officers as a group.
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE
OF BENEFICIAL OF BENEFICIAL PERCENT OF
OWNER OWNERSHIP CLASS
-------------------- ------------------ ---------
<S> <C> <C>
John E. Rayl
2706 Tremont Road
Columbus, Ohio 43221 402,265shares(a) 20.0%
Jerald K. Rayl
2808 Reeveston Road
Richmond, Indiana 47374 36,750shares(b) 1.9%
Thomas E. Reynolds
7907 Sarahurst Drive
Dublin, Ohio 43017 30,236shares(c) 1.6%
Paul R. Weinberger
4292 Woodstream Drive
Gahanna, Ohio 43230 30,263shares(c) 1.6%
James B. Dwyer
405 Park Avenue
New York, New York 10022 10,000shares(d) 0.5%
All directors and officers
as a group (5 persons) 509,514shares(e) 24.3%
- - --------------------
<FN>
(a) Includes stock options to purchase 146,666 shares, which are exercisable
within sixty (60) days. Mr. Rayl has sole voting power shared investment
power for all shares beneficially owned.
(b) Mr. Jerald K. Rayl holds a stock option to purchase 30,000 shares, which is
exercisable within sixty (60) days. He has sole voting power and
investment power for all shares beneficially owned.
(c) Mr. Reynolds and Mr. Weinberger each hold stock options to purchase 23,570
shares, which are exercisable within sixty (60) days. They each have sole
voting power and investment power for all shares beneficially owned.
(d) Mr. James B. Dwyer III holds a stock option to purchase 10,000 shares,
which is exercisable within sixty (60) days. He has sole voting power and
investment power for all shares beneficially owned.
(e) This amount includes stock options to purchase 233,806 shares.
(f) All common stock related items contained in this proxy statement have been
restated, unless specifically stated otherwise, for the Company's one (1)
to three (3) reverse stock split which was effected July 26, 1994.
</TABLE>
EXECUTIVE COMPENSATION
Notwithstanding anything to the contrary as set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Proxy Statement, in whole or in part, the following
information shall not be incorporated by reference into any such filings: (i)
Report on Repricing of Options/SARs as required by Regulation S-K, Item 402(i),
(ii) Board Compensation Committee Report on Executive Compensation as required
by Regulation S-K, Item 402(k), and (iii) Performance Graph as required by
regulation S-K, Item 402(l).
Page 6
<PAGE> 7
<TABLE>
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning the annual and
long-term compensation paid, or to be paid, and awarded to those persons who
were, at anytime during the three previous fiscal years, the chief executive
officer and the other four most highly compensated executive officers of the
Company for services rendered in all capacities to the Company for fiscal years
1994, 1993, and 1992.
<CAPTION>
LONG-TERM
COMPENSATION
---------------------------
ANNUAL COMPENSATION AWARDS
--------------------------------------------- ---------------------------
SECURITIES
OTHER UNDER-
ANNUAL RESTRICTED LYING ALL OTHER
NAME AND COMPEN- STOCK STOCK COMPEN-
PRINCIPAL STATION AWARD(S) OPTIONS STATION
POSITION YEAR SALARY ($) BONUS ($) ($) (A) (B) (#) ($)
- - ------------- ----- -------- -------- -------- --------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
John E. Rayl 1994 240,000 1,100 - - 113,333 -
Chairman, Chief 1993(c) 240,000 1,371 108,935 - 33,333 -
Executive Officer, 1992 240,000 - - - - -
President, and
Treasurer
Thomas E. Reynolds 1994(d) 56,250 1,100 25,560 - 11,666 -
Vice President, 1993 42,000 1,371 - - 11,904 -
Secretary, Assistant 1992 35,000 - - - 11,904 -
Treasurer, and
Director
Paul R. Weinberger 1994(d) 56,250 1,100 25,560 - 11,666 -
Vice President 1993 42,000 1,371 - - 11,904 -
and Controller 1992 42,000 - - - 11,904 -
Mark S. Manafo 1994(e) 135,422 1,100 - - 83,333 17,700
Chief Operating 1993 69,502 - - - - -
Officer and Director 1992 - - - - - -
(Partech Communications)
Mark S. Miller 1994 - - - - - -
Vice President, 1993 - - - - - -
General Counsel, 1992(f) 66,500 - - - 8,928 -
and Director
--------------------
<FN>
(a) Pursuant to the Securities and Exchange Commission's ("SEC") rules for the
disclosure hereof, Other Annual Compensation for fiscal 1993 has been
omitted.
(b) Restricted stock in the above table represents Common Stock that is not
registered pursuant the Securities Act of 1933 and has not been held by the
holder for a period of two years pursuant to Rule 144, as applicable. The
Company may, from time to time, grant restricted stock awards to the named
executive officers. No such grants were issued during the above fiscal
years. Holders of restricted stock are eligible to receive dividends when
and if dividends are paid. At April 30, 1994 officers held restricted
stock and the value (as described in C below) thereof was as follows: Mr.
Rayl held 72,568 shares of restricted stock valued at $217,704, Mr.
Reynolds held 6,666 shares of restricted stock valued at $19,998, and Mr.
Weinberger held 6,666 shares of restricted stock valued at $19,998.
(c) This year includes $99,235 of other annual compensation pursuant to SEC
requirements as described hereinafter. Mr. Rayl was owed $81,056 by the
Company pursuant to a note which Mr. Rayl acquired from a nonaffiliated
company for its face value. The Company paid this note by the issuance of
72,568 shares of restricted Common Stock. The SEC requires the Company to
report the difference between the price paid for the stock
Page 7
<PAGE> 8
($81,056) and the fair market value of such stock as other annual
compensation. Furthermore, the SEC requires that the fair market value of
the restricted stock hereof be computed by multiplying the number of shares
issued by the closing market price of the Company's unrestricted stock on
the date of grant. This year also includes $9,700 of automobile allowance
as other annual compensation.
(d) This year includes $25,560 of other annual compensation for both Mr.
Reynolds and Mr. Weinberger pursuant to SEC requirements as described in
(c) hereinabove. Mr. Reynolds and Mr. Weinberger each purchased 6,666
shares of the Company's Common Stock for $1,000.
(e) All Other Compensation for fiscal 1994 represents $17,700 of advances to
Mr. Manafo which the Company did not collect. Mr. Manafo's employment
terminated February 23, 1994.
(f) Mr. Miller resigned February 27, 1992.
(g) Mr. Kuntz resigned August 26, 1991 and had no amounts required to be
disclosed in the above table.
</TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning stock options granted
to those persons who, at anytime during the fiscal year ended April 30, 1994,
were the chief executive officer and the other four most highly compensated
executive officers of the Company.
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE AT
ASSUMED ANNUAL
RATES OF STOCK PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM (A)
- - ---------------------------------------------------------------------------------------- -------------------------
NUMBER OF % OF
SECURITIES TOTAL
UNDER- OPTIONS
LYING GRANTED TO EXERCISE GRANT
OPTIONS EMPLOYEES OR BASE DATE
GRANTED IN FISCAL PRICE MARKET EXPIRATION
NAME # YEAR ($/SH) (B) PRICE DATE (B) 5% ($) 10% ($)
- - ------------------- -------- ------------ -------------- -------------- ------------ -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
John E. Rayl 113,333 51.40 3.27 4.45 7/15/03 450,905 937,508
Mark S. Manafo (c) 83,333 37.79 3.27 4.45 7/15/03 331,547 689,343
Thomas E. Reynolds 11,666 5.29 3.27 4.45 7/15/03 46,414 96,503
Paul R. Weinberger 11,666 5.29 3.27 4.45 7/15/03 46,414 96,503
- - --------------------
<FN>
(a) Pursuant to the Securities and Exchange Commission's rules for the
disclosure hereof, this is intended to illustrate amounts that may be
realized at rates dictated by such rules if the stock options were
exercised immediately prior to their expiration dates. No gain to the
named executive officer is possible without an increase in the market price
of the Company's Common Stock above the exercise price. Therefore, if such
an increase does occur, all stockholders will benefit proportionately.
These amounts are not intended to forecast future appreciation of the
Company's stock prices and no assurance whatsoever can be given that these
levels of appreciation will be obtained.
(b) The stock options are immediately exercisable and expire ten years from the
date of grant, subject to earlier termination in certain events related to
termination of employment. Stock options may be exercised by the payment
of cash or other stock of the Company.
(c) Mr. Manafo's employment terminated February 23, 1994 and all options have
terminated (see "Aggregate Option Exercises and Fiscal Year-End Options
Value Table" below).
</TABLE>
Page 8
<PAGE> 9
AGGREGATE OPTION EXERCISES AND FISCAL YEAR-END OPTIONS VALUE TABLE
The following table sets forth information concerning stock options
exercised by, and the value of, unexercised stock options held by those persons
who, at anytime during the fiscal year ended April 30, 1994, were the chief
executive officer and the other four most highly compensated executive officers
of the Company.
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FISCAL YEAR END - FISCAL YEAR END -
NAME EXERCISABLE (#) (a) EXERCISABLE ($) (b)
- - ----------------- ------------------- -------------------
<S> <C> <C>
John E. Rayl 146,666 31,000
Mark S. Manafo (c) - -
Thomas E. Reynolds 23,570 11,071
Paul R. Weinberger 23,570 11,071
- - --------------------
<FN>
(a) All stock options which have been granted are currently exercisable.
(b) The value of unexercised in-the-money stock options at fiscal year end is
based on the closing price of the Company's Common Stock ($3.00), as
reported on the NASDAQ at April 30, 1994, less the exercise price per
share.
(c) Mr. Manafo's employment terminated February 23, 1994 and all options have
terminated
(d) No stock options were exercised during fiscal 1994.
</TABLE>
REPORT ON REPRICING OF OPTIONS
The following table sets forth information concerning stock options
repriced during fiscal 1994 for those persons who, at any time during the
fiscal year ended April 30, 1994, were the chief executive officer and the
other four most highly compensated executive officers of the Company, and all
stock options repriced for all executive officers for the last ten years.
<TABLE>
<CAPTION>
LENGTH
NUMBER OF MARKET OF ORIGINAL
SECURITIES PRICE OF EXERCISE OPTION TERM
UNDERLYING STOCK AT PRICE AT REMAINING
OPTIONS TIME OF TIME OF NEW AT DATE OF
REPRICED OR REPRICING OR REPRICING OR EXERCISE REPRICING OR
NAME DATE AMENDED (#) AMENDMENT ($) AMENDMENT ($) PRICE ($) AMENDMENT
- - --------------------- -------- ------------ ------------- ------------- --------- -------------
<S> <C> <C> <C> <C> <C> <C>
Previous Nine Years (a):
- - ------------------------
John E. Rayl 11/18/92 100,000 0.69 2.50 0.69 8.0 yr.
John E. Rayl 11/27/90 100,000 2.50 7.50 2.50 9.0 yr.
Thomas E. Reynolds 11/18/92 35,714 0.69 2.80 0.69 8.5 yr.
Paul R. Weinberger 11/18/92 35,714 0.69 2.80 0.69 8.5 yr.
Robert P. Kuntz 11/27/90 73,000 2.50 5.00 2.50 9.0 yr.
Robert P. Kuntz 11/27/90 73,000 2.50 4.38 2.50 9.0 yr.
Mark S. Miller 11/27/90 10,000 2.50 8.10 2.50 9.0 yr.
- - --------------------
<FN>
(a) The Company did not reprice any options during fiscal 1994. No other
reportable stock option repricing has occurred.
</TABLE>
COMPENSATION COMMITTEE
John E. Rayl
Thomas E. Reynolds
Page 9
<PAGE> 10
COMPENSATION OF DIRECTORS
Each director is to be paid $250 for attending each Board of Directors
Meeting. James B. Dwyer III is paid $750 a month for being on the audit
committee, is reimbursed expenses for any Board of Directors Meeting, and was
issued 10,000 stock options at $2.34375 per option. Jerald K. Rayl was issued
30,000 stock options at $3.27 per option.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
Employment Agreement With John E. Rayl
Mr. Rayl's employment agreement (the "Agreement") provides for annual
compensation of $240,000, an annual automobile allowance of $9,700, and accrued
interest at 10% per annum for deferred compensation. The annual salary shall
be increased as of each January 1 by a minimum annual adjustment as follows:
To determine the minimum annual adjustment, the annual salary shall be
multiplied by a fraction, the numerator of which shall be the United States
Department of Labor, Bureau of Labor Statistics' Consumer Price Index for Urban
Wage Earners and Clerical Workers, U.S. City Average, All Items (1967 = 100)
(the "Index") for the month of December of the immediately preceding year, and
the denominator of which shall be the Index for the month of February, 1984,
provided, however, that the fraction multiplied to determine the adjustment
shall not be less than 1.10 for any adjustment. Notwithstanding the foregoing,
the Board of Directors may, in its discretion at any time, increase the amount
of the annual salary payable. The annual salary, once increased, may not
thereafter be reduced without the prior written consent of Mr. Rayl. Mr. Rayl
has forgone all salary increases for the past four years. The Agreement
expires July 31, 2004, and is automatically extended for one year increments,
unless written notice is given ninety days prior to termination.
At the request of the of the Company's previous underwriters, the Company's
Chief Executive Officer agreed to reduce his salary effective May 1, 1994 to
$110,000 per year from $249,700, such amendment to his salary included an
increase of 5% of income before income taxes (excluding the CEO's compensation
and costs associated with the underwriting and any short-term loans undertaken
until the underwriting is completed) over $1,000,000 of the previous year.
This amendment became null and void, due to the underwriting with the previous
underwriters to which it related not being undertaken, and the salary was
retroactively adjusted to the previous amount.
The Company is required to purchase and maintain for Mr. Rayl during the
term of the Agreement $2,000,000 of whole-life insurance coverage on his life
to be paid to his designated beneficiaries. Mr. Rayl has waived this benefit
for the past two and one-half years. Mr. Rayl has death benefits which are
payable in monthly installments for five years and are equal to his annual
salary plus adjustments as describe hereinabove. The Company carries a
$2,000,000 life insurance policy on Mr. Rayl, of which the Company is the
beneficiary. In the event of Mr. Rayl's death the proceeds of such policy
will be used to pay his death benefit and to provide a replacement for Mr.
Rayl. In the event of disability, Mr. Rayl will be paid his annual salary plus
adjustments for the remainder of the term of the Agreement, which includes any
effective renewal period or extension.
The Agreement further provides that Mr. Rayl shall not be discharged during
the term of his Agreement unless his termination is for reason of dishonesty or
fraud in the performance of his duties. Mr. Rayl is entitled to terminate his
employment for good reason, which includes the following (these also apply to a
change of control, as described hereinafter): (i) assigned duties,
responsibilities, title, or offices are inconsistent as of the date of the
Agreement, (ii) does not retain any position, except in the case of dishonesty
or fraud, or as a result of his death or substantial disability, (iii)
reduction or discontinuation of benefits, and (iv) required to be based
anywhere other than Franklin County, Ohio.
If Mr. Rayl is discharged without a justifiable reason or Mr. Rayl
terminates his employment for good reason, he shall receive, for the remainder
of the Agreement and for not less than twenty-four (24) months, the annual
salary and adjustments, and other compensation and employee benefits that the
Company has agreed to pay.
If a change of control occurs during the term of the Agreement, Mr. Rayl,
whether or not his employment by the Company has been terminated, shall be
entitled to payment in the amount of $500,000. If a change of control occurs,
the Agreement shall be extended for a period of five (5) years dating from the
later of July 31, 2004 or the end of the then current one-year term. A change
of control includes: (i) a tender offer or exchange which results in an
ownership change of twenty-five percent (25%) or more of the Company's combined
voting power, (ii) merger or consolidation which results in less than
seventy-five percent (75%) of the resulting outstanding voting securities being
owned by former stockholders, (iii) transfer of all, or substantially all, the
Company's assets, (iv) acquisition of beneficial
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ownership of twenty-five percent (25%) or more of the Company's voting
securities then outstanding, and (v) if individuals who are members of the
Board of Directors as of July 15, 1993 do not constitute a majority thereafter.
Mr. Rayl has waived any rights that might be due him as to a change of control
that may have occurred heretofore.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
John E. Rayl, Chief Executive Officer, and Thomas E. Reynolds, Vice
President, were employed by the Company and served on the Compensation
Committee during fiscal 1994.
For the fiscal year ended April 30, 1994 the Company earned $96,615 from
partnerships which are partially owned by a nonconsolidated affiliate of which
John E. Rayl, the Company's Chief Executive Officer, is a general partner, and
recognized $256,268 of nonrecurring write-offs which relate to the above
mentioned partnerships and other nonconsolidated affiliates of the Company of
which the Company's Chief Executive Officer is a general partner or officer.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Compensation Philosophy. Partech's Compensation Committee is composed of
employee directors and is responsible for setting and administering the
policies which govern both the annual compensation and stock ownership programs
for all employees, officers, and directors of Partech. Partech's executive
compensation programs are designed to (i) relate the level of compensation
paid, to Partech's success in meeting its annual and long-term business
objectives and performance goals, (ii) reward individual achievement, and
(iii) enable it to recruit, retain, and motivate talented and diverse
executives. This is essential for Partech to achieve its business objectives,
performance goals, and to improve stockholder returns. As a result, the
Committee has determined that executive compensation opportunities, including
those for Partech's Chief Executive Officer ("CEO"), should create incentives
for superior performance and consequences for below target performance.
The Committee believes that the Company's executive compensation programs
have met their objectives. Partech has (i) met most annual business objectives
and is on target for meeting its long-term objectives, (ii) been able to
attract and retain the executive talent necessary to support a corporation
which has survived an industry depression, (iii) redirected its efforts to
other industry lines, and (iv) created significant acquisition opportunities
for new business and profit potential.
Compensation Programs. Partech's executive compensation mix includes a
base salary, cash bonus awards, stock bonus awards, and stock options. The
base salary component of compensation of Partech's executives was established
by comparing compensation paid to executives with similar accountabilities by
other similar companies and Partech's executives' underlying accountabilities.
Partech's base salary component ranks approximately with the average of other
Chief Executive Officers. Salary ranges for the CEO and other executive
officers are reviewed on a regular basis and benchmarked against similar
positions among similar companies. Salary increases are based on an assessment
of each executive's performance against those accountabilities, and personal
performance goals.
Stock related compensation is the principal method for payment of long-term
compensation and incentives, and is intended to link each executive officer's
opportunity for financial gain to increases in stockholder wealth, therefore,
benefiting stockholders and executives alike. The Committee annually evaluates
the total compensation for Partech's executives, including its CEO, in light of
an individual's contribution and potential contribution toward obtaining annual
and long-term business objectives and performance goals, and the performance of
other similar companies. Stock options are used for incentives for long-term
employment and performance. When the Committee grants stock bonuses and stock
options it does not consider the amount and terms of stock options, and
restricted stock already held by the executive officer.
The Committee believes that Partech's performance should be compared to not
only other leasing companies, but also to other companies whose financial
position and market share are similar to Partech's. Also, the Committee
believes that Partech's most direct competitors for executive talent are not
all of the companies that would be included in a peer group established to
compare stockholder returns. Therefore, the peer group used to determine
compensation is not limited to the peer group used in the performance graph
which is presented in this Proxy Statement.
Cash and stock bonus awards, and stock options for the CEO and other
executive officers, are based on personal performance and on Partech's
attainment of annual and long-term business objectives and performance goals.
Personal ratings can include such factors as quality of strategic plans,
organizational and management development, and special
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project or idea leadership. Annual and long-term business objectives and
performance goals include, among other things, financial targets and
developmental and project targets. The size of the awards is based on the same
factors which are used for base salary, and Partech's financial strength.
The primary performance measures used to determine the CEO's fiscal 1994
compensation were both quantitative and qualitative factors (including
subjective criteria, which were not subject to specific criteria) directly
linked to Partech's performance, achievement of annual and long-term business
objectives and performance goals, and the enhancement of stockholder value.
One of the qualitative performance measures used by the Committee was to assess
his ability and dedication to enhance the long-term value of Partech by
continuing to provide the leadership and vision that he has provided throughout
his tenure as CEO which has resulted in, among other things, the successful
restructuring of the Company's businesses to adjust for the decline in its
leasing business and effectively redirecting the Company's operations under the
difficult economic conditions in Partech's line of business.
Mr. Rayl's base salary is, and has been since 1991, $240,000, which is
within the range of salaries paid to Chief Executive Officers by other similar
companies. Mr. Rayl was not granted any stock options during fiscal 1994.
COMPENSATION COMMITTEE
John E. Rayl
Thomas E. Reynolds
PERFORMANCE GRAPH
The following graph compares the yearly percentage change in the
cumulative stockholder return on the Company's Common Stock during the five
fiscal years ended April 30, 1994, with the cumulative total return on the
NASDAQ Composite Index for United States companies listed thereon, and a peer
group index (the "Select Peer Group") consisting of other leasing companies
using a weighted amount according to the respective peer issuer's market
capitalization. The graph assumes $100 was invested on April 30, 1989, and all
dividends were reinvested on the date of payment.
<TABLE>
FISCAL YEARS ENDED APRIL 30,
____________________________________________________________________________
<CAPTION>
1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C>
NASDAQ 100 126 150 182 209 231
Select Peer Group 100 77 116 68 93 123
Partech 100 127 105 29 28 27
</TABLE>
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The Select Peer Group Consists of the following companies:
Comdisco, Inc. Capital Associates, Inc.
TJ Systems, Inc. Continental Information Systems, Inc.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
CERTAIN BUSINESS RELATIONSHIPS
During fiscal 1994, the Company entered into a financial advisory contract
with Dwyer & Associates, Inc. to assist in analyzing and negotiating broadcast
property acquisitions and other related acquisition and financing activities.
The Company has paid $25,000 heretofore and is required to pay additional
compensation if any acquisitions or financings occur, none of which are near
fruition. Mr. James Dwyer III is a principal of Dwyer & Associates, Inc.
PROPOSAL TO APPROVE AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION TO
INCREASE THE NUMBER OF PREFERRED SHARES THE COMPANY IS AUTHORIZED TO ISSUE
(PROXY ITEM #2)
Preferred stock is an increasingly useful security for raising investment
capital. The increase in the amount of Preferred Stock which is authorized for
issuance will increase the Company's flexibility in obtaining future investment
capital. The Company currently does not have any plans for the issuance of
Preferred Stock.
Preferred Stock may be issued in one or more series at such time or times,
and for such consideration or considerations as the Board of Directors may
determine. All shares of any one series of Preferred Stock will be identical
with each other in all respects, except that shares of one series issued at
different times may differ as to dates from which dividends thereon may be
cumulative. All series will rank equally and will be identical in all respects,
except as to matters which the Company's Certificate of Incorporation allows
the Company's Board of Directors to set.
The Board of Directors is authorized, at any time and from time to time, to
provide for the issuance of shares of Preferred Stock in one or more series
with such designations, preferences and relative, participating, optional or
other special rights and qualifications, limitations or restrictions thereof as
are stated and expressed in the resolution or resolutions providing for the
issue thereof adopted by the Board of Directors, and if not restricted by the
Company's Certificate of Incorporation or any amendment thereto including, but
not limited to, determination of any of the following: a) serial designation,
b) dividends and whether dividends are cumulative, c) voting powers, d)
redemption and prices therefor, if applicable, e) amounts payable upon
liquidation, dissolution or winding up of the Corporation, f) applicability of
sinking or retirement fund, g) conversion rights, and h) any other preferences,
privilidges and powers and relative participating, optional or other special
rights, and qualifications, limitations or restrictions of a series which are
not inconsistent with the Company's Certificate of Incorporation.
The Communications Act, FCC rules and the Company's amended Certificate of
Incorporation restricts, in part, the ownership, voting and transfer of the
Company's capital stock and equivalents. The restriction, as applicable,
prohibits non-U.S. citizens (or entities or individuals controlled by a
non-U.S. citizen) ("Aliens") from owning, directly or indirectly, more than 25%
of the outstanding capital stock or voting rights of the Company. The
restriction, accordingly, prohibits the transfer of the Company's common stock
and equivalents, which would include any Preferred Stock which is convertible
into the Company's Common Stock, by a shareholder to any person or entity if
such transfer would cause the Company to violate this prohibition. If a
transaction(s) occurs which causes the Allen ownership to exceed these FCC
mandated limitations, the Company's transfer agent will advise the Company of
the transaction(s) and amount of shares which caused the limitation to be
exceeded. The Company will then have the transaction(s) and shares reversed on
a "last-in - first-out" basis.
The Company may issue shares of Preferred Stock which are convertible into
the Company's Common Stock or other Capital Stock as an anti-takeover action.
The Company currently does not know of any anti-takeover actions. If the
Company issues Preferred Stock which is convertible, such conversion may be
dilutive to common stock holders. The Company's Certificate of Incorporation
currently authorizes the issuance of 1,000,000 shares of Preferred Stock.
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Proposal for Amendment:
The Company proposes to increase the amount of Preferred Stock which is
authorized for issuance to 20,000,000 shares.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE IN FAVOR OF RESOLUTION
#2
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS (PROXY ITEM #3)
Hausser + Taylor, independent certified public accountants (the
"Auditors"), have served as the Company's auditors since 1987. It is
anticipated that a representative of the Auditors will attend the Annual
Meeting for the purpose of responding to appropriate questions. At the Annual
Meeting, a representative of the Auditors will be afforded an opportunity to
make a statement if the Auditors so desire.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE IN FAVOR
OF RESOLUTION #3
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
To the best knowledge and belief of the Company, Corporate Life Insurance
Company, Robert P. Kuntz and William G. Morgan did not report the expiration of
their B Warrants or the expiration of the right to receive B Warrants on Forms
4 or 5. Corporate Life Insurance Company did not report the expiration of
800,000 B Warrants. Mr. Morgan did not report the expiration of 275,000 B
Warrants. Mr. Morgan had the right to receive 275,000 B Warrants, however, Mr.
Morgan is an Oklahoma resident and the Company's B Warrants were not registered
for distribution to residents of Oklahoma. Mr. Kuntz did not report the
expiration of 823,425 B Warrants. Mr. Kuntz had the right to receive 823,425 B
Warrants, however, Mr. Kuntz is a Florida resident and the Company's B Warrants
were not registered for distribution to residents of Florida. Also, Mr.
Morgan did not report the expiration of a stock option to purchase 20,000
shares of the Company's Common Stock. The amount hereof are before restatement
for the Company's one (1) to three (3) reverse stock split.
PROPOSALS BY STOCKHOLDERS
Any stockholder proposal which is intended to be presented at the next
Annual Meeting must be received at the Company's principal executive offices by
no later than June 27, 1995, if such proposal is to be considered for inclusion
in the Company's Information Statement, if any, and Proxy Statement, if any,
relating to such meeting.
OTHER BUSINESS
The meeting is being held for the purposes set forth in the Notice of the
Annual Meeting of Stockholders. The Board of Directors is not presently aware
of any business to be transacted at the meeting other than as set forth in such
notice.
PARTECH HOLDINGS CORPORATION
/s/ JOHN E. RAYL
John E. Rayl
Chairman of the Board and
Chief Executive Officer
October 27, 1994
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EXHIBIT INDEX
Exhibit 3.7 Proposed Amendment to Partech Holdings Corporation Certificate
of Incorporation, Proxy Item Number 2, is incorporated herein
by reference to Exhibit 3.7, to Schedule 14A, Preliminary
Proxy Statement, filed August 22, 1994, Commission file No.
014361.
Exhibit 20.3 Form of Proxy for 1994 Annual Meeting of Shareholders is
incorporated herein by reference to Exhibit 20.3, to Schedule
14A, Preliminary Proxy Statement, filed August 22, 1994,
Commission file No. 014361.
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