SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
SAZTEC INTERNATIONAL, INC.
(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Consent Solicitation Statement
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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SAZTEC INTERNATIONAL, INC.
43 MANNING ROAD
BILLERICA, MASSACHUSETTS 01821
TELEPHONE: (508) 262-9600
Dear Shareholders:
The Board of Directors of Saztec International, Inc. is soliciting
consents from shareholders in favor of a proposed amendment to the Company's
Restated Articles of Incorporation. The proposed amendment is to effect a
1-for-4 reverse stock split of the Company's Common Stock, whereby four
outstanding shares of Common Stock of the Company will be combined into one
share of Common Stock after the stock split, and to increase the number of
authorized shares of Common Stock from 5,000,000 (after giving effect to the
reverse stock split) to 10,000,000 shares. The approval of this amendment is a
condition to the Company closing the sale of 860,000 shares of Common Stock and
warrants to purchase an additional 860,000 shares of Common Stock (on a
post-reverse split basis) to investors for an aggregate purchase price of
$860,000. The proposed amendment and private placement transaction are described
in the attached Consent Solicitation Statement.
If the proposed amendment is approved, a shareholder owning 100 shares
of common stock before the reverse stock split will own 25 shares following the
reverse split. All other shareholders of the Company will have their shares of
Common Stock similarly combined on a 1-for-4 basis. Although you will own fewer
shares of the Common Stock after the reverse split, your percentage ownership of
the Company will be unaffected by the reverse split. The issuance of 860,000
shares of Common Stock and warrants to purchase an additional 860,000 shares of
Common Stock in the private placement transaction described in the Consent
Solicitation Statement will, of course, reduce the percentage ownership of the
Company by any shareholder not participating in the private placement
transaction.
The Board of Directors recommends that shareholders give their consent
to the approval of the proposed amendment. The approval of the amendment will
enable the Company to complete the private placement transaction.
On behalf of the Board of Directors, thank you for your cooperation and
continued support.
Sincerely,
Gary N. Abernathy
PRESIDENT AND CHIEF EXECUTIVE OFFICER
October 3, 1997
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SAZTEC INTERNATIONAL, INC.
43 MANNING ROAD
BILLERICA, MASSACHUSETTS 01821
TELEPHONE: (508) 262-9600
CONSENT SOLICITATION STATEMENT
SOLICITATION AND REVOCABILITY OF CONSENTS
This Consent Solicitation Statement is furnished in connection with the
solicitation of consents by the Board of Directors of Saztec International, Inc.
(the "Company") in favor of a proposed amendment to the Company's Restated
Articles of Incorporation. The Board of Directors of Saztec International, Inc.
is soliciting consents from shareholders in favor of an amendment to the
Company's Restated Articles of Incorporation to effect a 1-for-4 reverse stock
split of the Company's Common Stock, whereby four outstanding shares of Common
Stock of the Company will be combined into one share of Common Stock after the
stock split (and the Company's 20,000,000 authorized shares of Common Stock will
be combined into 5,000,000 shares) and to increase the number of authorized
shares of Common Stock from 5,000,000 (after giving effect to the reverse stock
split) to 10,000,000 shares. The approval of this amendment is a condition to
the Company closing the sale of 860,000 shares of Common Stock and warrants to
purchase an additional 860,000 shares of Common Stock (on a post-reverse split
basis) to investors for an aggregate purchase price of $860,000. One of the
investors (an affiliate of the Company's largest shareholder) has already
purchased 300,000 units (consisting of 300,000 shares of Common Stock and
warrants to purchase an additional 300,000 shares, all computed on a
post-reverse stock split basis).
The Company presently has 1,000,000 authorized but unissued shares of
Preferred Stock. The number of authorized shares of Preferred Stock will not be
affected by the proposed amendment to the Company's Articles of Incorporation.
The approximate date on which this Consent Solicitation Statement and
accompanying Consent card are first being sent or given to shareholders is
October 3, 1997.
Consents must be submitted by October 31, 1997, to be effective.
Shares represented by each Consent, if properly executed and returned
to the Company, will constitute a vote in favor of the proposed amendment to the
Company's Restated Articles of Incorporation. A shareholder executing a Consent
may revoke it at any time before it is acted upon by giving written notice to
the Secretary of the Company at the address set forth above. A shareholder who
does not consent to the proposed amendment does not need to take any action. The
Consent does not need to be executed or returned to reflect a disapproval of the
amendment. The failure to execute and return a Consent to the Company has the
effect of voting against the amendment.
An abstention (simply not signing and returning the enclosed Consent)
and broker non-votes will have the effect of a vote against the proposed reverse
stock split and the increase in the number of authorized shares of Common Stock.
If a shareholder does not want to consent to the proposed amendment, you do not
need to sign or return the enclosed Consent or take any other action.
Shareholders are urged to review the terms of the proposed private
placement transaction described below under "BACKGROUND FOR THE PROPOSED
AMENDMENT." The Company will provide
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to any shareholder upon request a copy of the Subscription Agreements from each
of the proposed participants in the private placement transaction. Requests for
the Subscription Agreements should be addressed to the Secretary of the Company
at the address and telephone number above. The private placement was approved by
the Company's Board of Directors. No shareholder approval of the private
placement is required. A shareholder's consent to the proposed amendment to the
Company's Articles of Incorporation does not limit any shareholder action or
recourse against the Company regarding the private placement transaction.
All expenses of this Consent solicitation will be borne by the Company.
The Company estimates that the expenses of the Consent solicitation will not
exceed $15,000.
SUBMISSION OF SHAREHOLDER PROPOSALS
If any shareholder would like to submit a shareholder proposal to be
presented at the next annual meeting of the shareholders of the Company, that
proposal must be received for inclusion in the Company's proxy statement and
proxy card for the annual meeting by December 15, 1997.
OUTSTANDING VOTING SECURITIES OF THE COMPANY
On September 12, 1997, there were outstanding 15,487,851 shares of
Common Stock of the Company. The record date for determining shareholders
entitled to grant Consents will be the first date on which a Consent is received
by the Company. The Consent of the holders of at least a majority of the shares
of Common Stock as of that record date is necessary to approve the reverse stock
split and the increase in the number of authorized shares of Common Stock. Each
share of Common Stock is entitled to one vote on the proposed amendment.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of September 12, 1997, information
concerning the beneficial ownership of the Common Stock of the Company by (i)
each person who is known by the Company to own beneficially more than 5% of the
Company's Common Stock, (ii) each director of the Company, and (iii) all
directors and executive officers of the Company as a group.
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TOTAL PERCENT
BENEFICIAL OF
NAME OF BENEFICIAL OWNER OWNERSHIP CLASS(1)
- ------------------------ ---------- --------
Gary N. Abernathy(2)........................ 211,159 1.1
43 Manning Road
Billerica, MA 01821
Robert P. Dunne(3).......................... 868,332 4.5
928 Southwest Tenth Street
Miami, FL 33130
Lee R. Petillon............................. 118,000 *
21515 Hawthorne Blvd., #1260
Torrance, CA 90503
Tom W. Olofson(4)........................... 396,000 2.0
501 Kansas Ave.
Kansas City, KS 66105
Richard P. Kiphart(5)....................... 1,565,786 8.2
222 West Adams
Chicago, IL 60603
Tallard B.V.(6)............................. 6,529,364 34.3
c/o Peder G. Wallenberg
Amsteldijk 166 Rivierstaete
1079 LH Amsterdam
Datamatics Technologies PVT. LTD.(7)........ 1,600,000 8.4
C/o Dr. Lalit S. Kanodia, Chairman
Unit #118-120, SDF 4
SEEPZ Andheri (East)
Bombay 400 096, India
Pradeep Barthakur(8)........................ 823,000 4.3
26 Derby Lane
Tyngsboro, MA 01879
All directors and executive officers
as a group (9 persons).................... 2,600,491 13.6
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* Less than one percent (1%).
(1) Based on 15,487,851 shares outstanding on September 12, 1997, 116,666 shares
authorized to be issued, 546,600 exercisable options and warrants to issue
an additional 2,884,000 shares, in aggregate, at such date, for a total of
19,035,117.
(2) The shares beneficially owned by Mr. Abernathy are issued in the following
manner: 10,759 shares in the name of Information Control, Inc. which is
wholly-owned by Mr. Abernathy, a vested right to acquire 96,000 shares
pursuant to stock options, 64,400 shares owned directly, and warrants for
40,000 shares.
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(3) The shares beneficially owned by Mr. Dunne consist of: 94,565 shares in the
name of Robertson Corporation (of which Mr. Dunne is the sole owner), a
vested right to acquire 249,000 shares pursuant to stock options, warrants
to purchase 120,000 shares, 300 shares held by the Amy Schneeberger Trust,
of which Mr. Dunne is a trustee, 400 shares held by Mrs. Dunne's Individual
Retirement Account, and 404,067 shares owned directly.
(4) The shares beneficially owned by Mr. Olofson consist of: 226,000 shares
owned directly, vested options to purchase 30,000 shares, and warrants to
purchase 140,000 shares.
(5) The shares beneficially owned by Mr. Kiphart are issued in the following
manner: 1,302,746 shares owned directly, warrants to purchase 120,000
shares, and 143,040 shares held in total by three trusts for Mr. Kiphart's
children, of which Mrs. Kiphart is the trustee.
(6) The shares beneficially owned by Tallard B.V. are held in the following
manner: 4,129,364 shares owned directly by Tallard B.V., 83,333 shares
authorized to be issued, 1,200,000 shares in the name of Tallard Infologix
N.V., a wholly-owned subsidiary of Tallard B.V., and warrants to purchase
1,200,000 shares in the name of Tallard Infologix N.V. Tallard B.V. is
wholly owned by Mr. Wallenberg, and he may be deemed to be the beneficial
owner of all shares held by Tallard B.V. and Tallard Infologix N.V.
(7) The shares beneficially owned by Datamatics Technologies PVT. LTD. consist
of: 800,000 shares owned directly and warrants to purchase 800,000 shares.
Datamatics Technologies PVT. LTD. is wholly owned by Dr. Lalit S. Kanodia,
and he may be deemed to be the beneficial owner of these shares.
(8) The shares held by Mr. Barthakur consist of 420,000 shares owned directly,
vested rights to purchase 3,000 shares pursuant to stock options, and
warrants to purchase 400,000 shares.
BACKGROUND FOR THE PROPOSED AMENDMENT
Various directors, officers and existing shareholders of the Company
(the "Buyers") agreed to purchase from the Company 860,000 units (the "Units"),
each Unit consisting of (i) one share of Common Stock of the Company; and (ii)
one warrant to purchase one share of Common Stock of the Company for a purchase
price of $2.00 per share. The warrants are exercisable for two years after the
date of issuance of the warrants. The aggregate purchase price for the 860,000
Units is $860,000. One of the investors (an affiliate of the Company's largest
shareholder) has already purchased 300,000 Units (consisting of 300,000 shares
of Common Stock and warrants to purchase an additional 300,000 shares, all
computed on a post-reverse stock split basis) to provide immediate working
capital for the Company.
On September 29, 1997, the last reported price for shares of Common
Stock of the Company was $0.155 per share (based on the average of the bid and
ask prices for the Common Stock on the OTC bulletin board).
The terms of the Subscription Agreements between the Company and the
Buyers for the purchase of the Units provides that the obligation of the Buyers
to purchase the Units is subject to the condition that the Company obtains
shareholder approval of and completes a reverse stock split whereby four shares
of currently issued and outstanding Common Stock are converted into one share of
issued and outstanding Common Stock. The Company does not presently have (and
after the reverse stock split will not have) sufficient authorized but unissued
shares of Common Stock to issue to the Buyers under the Subscription Agreement
and the warrants. Accordingly, the Company is simultaneously with the reverse
stock split seeking shareholder approval of an amendment to the Restated
Articles of Incorporation of the Company to increase the number of authorized
shares of Common Stock of the Company from 5,000,000 to 10,000,000
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shares, after giving effect to the reverse stock split. This Consent
Solicitation Statement has been prepared by the Company in an effort to satisfy
each of these conditions.
Each of the Buyers is or is affiliated with an existing director,
officer or significant shareholder of the Company. The following table sets
forth the name of each Buyer and the number of Units for which each Buyer has
subscribed.
BUYER NO. OF UNITS PRICE
- ----- ------------ -----
Tallard Infologix N.V.(1) 700,000 $700,000
Pradeep Barthakur(2) 75,000 75,000
Tom W. Olofson(3) 35,000 35,000
Richard Kiphart(4) 25,000 25,000
Petillon & Hansen(5) 10,000 10,000
Robert P. Dunne(6) 10,000 10,000
Gary N. Abernathy(7) 5,000 5,000
------ ------
TOTAL 860,000 $860,000
- ---------------
(1) Tallard Infologix, N.V. is affiliated with Tallard B.V., which is the
approximately 34% shareholder of the Company (prior to the completion of
the sale of the Units). In order to meet the short-term cash needs of the
Company, Tallard Infologix has already purchased 300,000 Units (on a
post-split basis) for $300,000, and will purchase the remaining 400,000
Units upon approval of the proposed amendment to effect the reverse stock
split and to increase the authorized shares of Common Stock.
(2) Mr. Barthakur is a director of the Company.
(3) Mr. Olofson is a director of the Company.
(4) Mr. Kiphart is an 8% shareholder of the Company.
(5) Petillon & Hansen is a law firm of which Mr. Lee Petillon, a director of
the Company, is a principal.
(6) Mr. Dunne is the Chairman of the Board of the Company.
(7) Mr. Abernathy is the President and Chief Executive Officer and a director
of the Company.
The Company believes that the investment by the Buyers in the Company
will improve the Company's financial position. The Company has experienced
several years of financial losses, and has experienced and continues to
experience difficulties with its liquidity and cash flow. The proposed
transaction with the Buyers will provide the Company with increased liquidity
and cash flow, thereby allowing it to more effectively conduct its business
operations.
The issuance of the Units to the Buyers, at the price set forth above,
will not adversely affect the rights of existing shareholders.
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PROPOSAL TO EFFECT A REVERSE STOCK SPLIT
IN THE COMPANY'S COMMON STOCK AND TO
INCREASE THE NUMBER OF AUTHORIZED SHARES
The Company's Board of Directors recommends that the Company's
shareholders approve an amendment (the "Amendment") to the Company's Restated
Articles of Incorporation that would effect a one for four reverse stock split
of the Common Stock of the Company, whereby four outstanding shares of Common
Stock of the Company would be combined into one share of Common Stock of the
Company. The Company is currently authorized to issue 20,000,000 shares of
Common Stock, which number will be automatically reduced to 5,000,000 shares if
the reverse stock split is approved and effected. The Company's Board of
Directors recommends that the Company's shareholders approve (simultaneously
with the approval of the reverse stock split) the Amendment, which would also
increase the authorized shares of the Company's Common Stock from 5,000,000
shares to 10,000,000 shares (after giving effect to the reverse stock split). If
the Amendment is approved by the Company's shareholders, ARTICLE FOURTH of the
Company's Restated Articles of Incorporation, as amended, will read as follows:
"FOURTH: (a) Upon the effectiveness of this amendment each of the
issued and outstanding shares of common stock of the Corporation shall
be, and hereby is, automatically reclassified as and converted into
shares of common stock of the Corporation on the basis of one (1) share
of newly issued common stock for each four (4) shares of common stock
held by the Corporation's shareholders prior to the filing of this
amendment. Any fractional shares created by this 1-for-4 reverse stock
split shall be canceled and paid in cash to the shareholder upon the
issuance of the shareholder's stock certificate, calculated in
accordance with the closing trading price for the Corporation's common
stock on the date this amendment is filed.
(b) The Corporation shall have authority to issue two classes
of stock, 1,000,000 shares of preferred stock ("Preferred Stock"), and
10,000,000 shares of common stock ("Common Stock").
(c) The Preferred Stock may be issued from time to time in one
or more series. The Board of Directors is authorized to fix the number
of shares of any series of Preferred Stock and to determine the
designation of any such series. The Board of Directors is also
authorized to determine or alter the rights, preferences, privileges
and restrictions granted to or imposed upon any wholly-unissued series
of Preferred Stock and, within the limits and restrictions stated in
any resolution or resolutions of the Board of Directors originally
fixing the number of shares constituting any series, to increase or
decrease (but not below the number of shares of such series then
outstanding) the number of shares of any such series subsequent to the
issue of shares of that series."
The amendment to the Articles of Incorporation of the Company to effect
the reverse stock split is being undertaken primarily because it is a condition
to the sale of the Units to the Buyers. The amendment is also desirable because
the Company believes that the reverse stock split should have a corresponding
increase in the trading price of the Common Stock, although the Company makes no
representation that there will be any increase in the trading price for the
Common Stock after the reverse stock split or that any trading price for the
Common Stock immediately after the reverse stock split will be maintained. The
Company believes that a higher trading price for the Common Stock could increase
the liquidity of the Common Stock in the market.
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The Company proposes to increase the number of authorized shares of its
Common Stock to 10,000,000 shares to provide additional shares primarily so that
it will have sufficient authorized but unissued shares of Common Stock to
complete the sale of 860,000 shares of Common Stock and warrants to purchase an
additional 860,000 shares of Common Stock to the Buyers. The Company also
proposes the increase in the number of authorized shares of its Common Stock to
provide additional shares for general corporate purposes, including, raising
additional capital, issuances pursuant to employee stock and option plans,
possible future acquisitions and stock dividends and splits. There are no
present plans, understandings or agreements, however, for issuing shares of
Common Stock from the currently authorized shares of Common Stock or the
additional shares of stock proposed to be authorized pursuant to the Amendment,
other than the proposed sale of the Units to the Buyers. The increase in the
total number of shares of authorized Common Stock will enable the Company to
complete the sale of the Units to the Buyers, and the Board of Directors
believes that it will better enable the Company to meet its future needs, and
give it greater flexibility in responding quickly to advantageous business
opportunities. The proposed increase will also provide additional shares for
corporate purposes generally.
The Company presently has 1,000,000 authorized but unissued shares of
Preferred Stock. The number of authorized shares of Preferred Stock will not be
affected by the proposed amendment to the Company's Articles of Incorporation.
The proceeds from the proposed sale of the Units will be for general
working capital purposes and equipment purchases. The Company anticipates that
approximately $500,000 of the proceeds will be used for general working capital
purposes and approximately $300,000 will be used for computer equipment and
software for use in the Company's data conversion and imaging business.
The Company's issuance of shares of Common Stock, including the
additional shares that will be authorized if the proposed Amendment is adopted,
may dilute the present equity ownership position of current holders of Common
Stock and may be made without shareholder approval, unless otherwise required by
applicable laws.
The Board of Directors believes that, as proposed, the approval of the
Amendment is in the best interests of the shareholders of the Company. Approval
of this proposal requires the consent of the holders of a majority of the
Company's outstanding shares of Common Stock.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS GIVE THEIR
CONSENT TO THE PROPOSAL TO AMEND THE COMPANY'S RESTATED ARTICLES
OF INCORPORATION TO EFFECT A 1-FOR-4 REVERSE STOCK SPLIT OF THE
COMMON STOCK AND TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF
COMMON STOCK.
BY ORDER OF THE BOARD OF DIRECTORS
----------------------------------
Kent L. Meyer, Secretary
Billerica, Massachusetts
October 3, 1997
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SAZTEC INTERNATIONAL, INC.
CONSENT SOLICITED BY THE BOARD OF DIRECTORS
THIS CONSENT IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF SAZTEC
INTERNATIONAL, INC.
The undersigned hereby consents, in accordance with the California
General Corporation Law, to the adoption of an amendment to the Restated
Articles of Incorporation of Saztec International, Inc. to effect a one for four
reverse stock split and to increase the authorized number of shares of Common
Stock from 5,000,000 to 10,000,000 (after giving effect to the reverse stock
split), as described in the Saztec International, Inc. Consent Solicitation
Statement dated October 3, 1997.
IF YOU DO NOT CONSENT TO THE PROPOSED AMENDMENT, YOU DO NOT NEED TO TAKE
ANY ACTION.
Dated: ___________________________, 1997.
__________________________________________
Please sign name(s) exactly as shown at left.
When signing as executor, administrator,
trustee or guardian, give full title as such;
when shares have been issued in names of two
or more persons, all should sign.
