SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. |_|)
Filed by the registrant |X|
Filed by a party other than the registrant |_|
Check the appropriate box:
|_| Preliminary proxy statement |_| Confidential, for use of
|X| Definitive proxy statement the Commission only (as
permitted by Rule 149-6 (C)(2))
|_| Definitive additional materials
|_| Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
Presstek, Inc.
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(Name of Registrant as Specified in Its Charter)
Board of Directors of Presstek, Inc.
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(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
|_| Fee paid previously with preliminary materials.
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|_| Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date Filed:
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1 Set forth the amount on which the filing fee is calculated and state how it
was determined.
<PAGE>
PRESSTEK, INC.
8-9 Commercial Street
Hudson, New Hampshire 03051
April 23, 1997
Dear Fellow Stockholders:
You are cordially invited to attend our Annual Meeting of Stockholders
which will be held on Friday, May 30, 1997 at 11:00 A.M. at 55 Executive Drive,
Hudson, New Hampshire 03051.
The Notice of Annual Meeting and Proxy Statement which follow describe the
business to be conducted at the meeting.
Whether or not you plan to attend the meeting in person, it is important
that your shares be represented and voted. After reading the enclosed Notice of
Annual Meeting and Proxy Statement, I urge you to complete, sign, date and
return your proxy card in the envelope provided. If the address on the
accompanying material is incorrect, please inform our Transfer Agent,
Continental Stock Transfer & Trust Company, in writing, at 2 Broadway, New York,
New York 10004.
Your vote is very important, and we will appreciate a prompt return of your
signed proxy card. We hope to see you at the meeting.
Cordially,
Robert Howard
Chairman of the Board
<PAGE>
PRESSTEK, INC.
8-9 Commercial Street
Hudson, New Hampshire 03051
--------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 30, 1997
--------------------
To the Stockholders of PRESSTEK, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Presstek,
Inc. (the "Company") will be held on Friday, May 30, 1997, at 11:00 A.M. at 55
Executive Drive, Hudson, New Hampshire, 03051, for the following purposes:
1. To elect seven (7) directors to hold office until the next Annual
Meeting of Stockholders and until their respective successors have been duly
elected and qualified; and
2. To transact such other business as may properly come before the Annual
Meeting of Stockholders or any adjournment or adjournments thereof.
Only stockholders of record at the close of business on April 14, 1997 are
entitled to notice of and to vote at the Annual Meeting of Stockholders or any
adjournments thereof.
By Order of the Board of Directors,
Robert Howard
Chairman of the Board
April 23, 1997
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IF YOU DO NOT EXPECT TO BE PRESENT AT THE MEETING:
PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENVELOPE
PROVIDED FOR THAT PURPOSE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES. THE PROXY MAY BE REVOKED AT ANY TIME PRIOR TO EXERCISE, AND IF YOU ARE
PRESENT AT THE MEETING YOU MAY, IF YOU WISH, REVOKE YOUR PROXY AT THAT TIME AND
EXERCISE THE RIGHT TO VOTE YOUR SHARES PERSONALLY.
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<PAGE>
PROXY STATEMENT
PRESSTEK, INC.
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 30, 1997
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of PRESSTEK, INC. (the "Company") for use at
the Annual Meeting of Stockholders to be held on May 30, 1997 (the "Annual
Meeting"), including any adjournment or adjournments thereof, for the purposes
set forth in the accompanying Notice of Meeting.
Management intends to mail this proxy statement and the accompanying form
of proxy to stockholders on or about April 24, 1997.
Proxies in the accompanying form, duly executed and returned to the
management of the Company and not revoked, will be voted at the Annual Meeting.
Any proxy given pursuant to such solicitation may be revoked by the stockholder
at any time prior to the voting of the proxy by a subsequently dated proxy, by
written notification to the Secretary of the Company, or by personally
withdrawing the proxy at the Annual Meeting and voting in person.
The address and telephone number of the principal executive offices of the
Company are:
8-9 Commercial Street
Hudson, New Hampshire 03051
Telephone No.: (603) 595-7000
OUTSTANDING STOCK AND VOTING RIGHTS
Only stockholders of record at the close of business on April 14, 1997 (the
"Record Date") are entitled to notice of and to vote at the Annual Meeting. As
of the Record Date, there were issued and outstanding 15,449,771 shares of the
Company's common stock, $.01 par value per share (the "Common Stock"), the
Company's only class of voting securities. Each share entitles the holder to one
vote on each matter submitted to a vote at the Annual Meeting.
<PAGE>
Voting Procedures
The directors will be elected by the affirmative vote of the holders of a
plurality of the shares of Common Stock present in person or represented by
proxy at the Annual Meeting, provided a quorum is present. A quorum is present
if, as of the Record Date, the holders of at least a majority of the outstanding
shares of Common Stock are present in person or represented by proxy at the
Annual Meeting. All other matters at the meeting will be decided by the
affirmative vote of the holders of a majority of the shares of Common Stock cast
with respect thereto, provided a quorum is present. Votes will be counted and
certified by one or more Inspector(s) of Election who are expected to be
employees of Continental Stock Transfer & Trust Company, the Company's transfer
agent. In accordance with Delaware law, abstentions and "broker non-votes" (i.e.
proxies from brokers or nominees indicating that such persons have not received
instructions from the beneficial owner or other persons entitled to vote shares
as to a matter with respect to which the brokers or nominees do not have
discretionary power to vote) will be treated as present for purposes of
determining the presence of a quorum. For purposes of determining approval of a
matter presented at the Annual Meeting, abstentions will be deemed present and
entitled to vote and will, therefore, have the same legal effect as a vote
"against" a matter presented at the meeting. Broker non-votes will be deemed not
entitled to vote on the subject matter as to which the non-vote is indicated and
will, therefore, have no legal effect on the vote on that particular matter.
The enclosed proxies will be voted in accordance with the instructions
thereon. Unless otherwise stated, all shares represented by such proxy will be
voted as instructed. Proxies which are executed but which do not contain
specific instructions will be voted in favor of the proposals contained herein.
Proxies may be revoked as noted above.
ELECTION OF DIRECTORS
At this year's Annual Meeting of Stockholders, seven (7) directors will be
elected to hold office for a term expiring at the Annual Meeting of Stockholders
to be held in 1998. Each director will be elected to serve until a successor is
elected and qualified or until the director's earlier resignation or removal.
At this year's Annual Meeting of Stockholders, the proxies granted by
stockholders will be voted individually for the election, as directors of the
Company, of the persons listed below, unless a proxy specifies that it is not to
be voted in favor of a nominee for director. In the event any of the nominees
listed below shall be unable to serve, it is intended
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<PAGE>
that the proxy will be voted for such other nominees as are designated by the
Board of Directors. Each of the persons named below has indicated to the Board
of Directors of the Company that he will be available to serve.
Name Age Position
---- --- --------
Robert Howard 73 Chairman of the Board and Director
Richard A. Williams 62 Chief Executive Officer,
Secretary, Vice Chairman of the
Board and Director
Robert E. Verrando 63 President, Chief Operating
Officer and Director
Dr. Lawrence Howard 44 Director
Harold N. Sparks 75 Director
Bert DePamphilis 64 Director
John W. Dreyer 59 Director
Robert Howard, a founder of the Company, has been Chairman of the Board of
Directors since June 1988 and a director of the Company since September 1987. He
served as President and Treasurer of the Company from October 1987 to June 1988.
Mr. Howard, the founder of Howtek, Inc. ("Howtek"), a publicly-held company
engaged in the manufacture of electronic prepress equipment, has served as
Chairman of the Board of Howtek since August 1984. Mr. Howard served as the
President of Howtek from August 1984 through November 1987 and as its Chief
Executive Officer from August 1984 to December 1993. Mr. Howard, the inventor of
the first impact dot matrix printer, was the founder of Centronics Data Computer
Corporation ("Centronics"), a manufacturer of printers. Mr. Howard served as
President and Chairman of the Board of Directors of Centronics from 1969 to
April 1980, resigning from the Board of Directors of Centronics in 1983. From
April 1980 until 1983, Mr. Howard was principally engaged in the management of
his investments. In February 1994, Mr. Howard entered into a settlement
agreement in the form of a consent decree with the Securities and Exchange
Commission (the "Commission") in connection with the Commission's investigation
covering trading in the common stock of Howtek by an acquaintance of Mr. Howard
and a business associate of such acquaintance. Mr. Howard, without admitting or
denying the Commission's allegations of securities laws violations, agreed to
pay a fine and to the entry of a permanent injunction against future violations
of Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934.
- 3 -
<PAGE>
Richard A. Williams, has been Chief Executive Officer and Vice Chairman of
the Board of the Company since February 1996. He has been Secretary of the
Company since June 1988 and a director of the Company since November 1987. From
June 1988 to February 1996 Mr. Williams served as an Executive Vice President
and Chief Operating Officer of the Company. From November 1987 to June 1988 Mr.
Williams served as Vice President of the Company, and served as Director of
Operations from September 1987 through October 1987. From June 1985 to February
1987, Mr. Williams served as Vice President of Engineering for Centronics, where
he was responsible for line matrix and laser printer development and
introduction.
Robert E. Verrando has been President and Chief Operating Officer of the
Company since February 1996 and a director of the Company since November 1994.
From October 1994 to February 1996 he served as an Executive Vice President of
the Company. From July 1993 to October 1994, Mr. Verrando was employed as a
consultant to the graphic arts industry. From October 1986 through July 1993, he
was employed in a variety of executive positions with Compugraphic Corporation
and Agfa Compugraphic/Agfa Division, Miles, Inc., most recently as Vice
President and General Manager, Business Imaging Systems Group. From April 1981
to September 1986 he was employed as Vice President - Business Development of
A.B. Dick Company.
Dr. Lawrence Howard, a founder of the Company, has been a director of the
Company since November 1987 and served as Vice Chairman of the Board from
November 1992 to February 1996. He served as Chief Executive Officer and
Treasurer of the Company from June 1988 to June 1993; served as President from
June 1988 to November 1992; and was Vice President from October 1987 to June
1988. From March 1997 to the present, Dr. Howard has been a general partner of
Hudson Ventures, LP., a limited partnership that has prepared an application to
qualify as a small business investment company. From July 1995 to March 1997,
Dr. Howard was President of Howard Capital Partners, Inc., an investment banking
firm. From July 1994 to July 1995 Dr. Howard was Senior Managing Director of
Whale Securities Co. L.P., an NASD registered broker-dealer. From October 1992
through June 1994 Dr. Howard was President and Chief Executive Officer of LH
Resources, Inc., a management and financial consulting firm. Dr. Howard is a
director of Resurgence Properties, Inc., a public company engaged in investments
in and management of real estate. Dr. Howard is the son of Robert Howard.
Harold N. Sparks has been a director of the Company since February 1989.
From 1971 to September 1995, Mr. Sparks was the President and Chief Executive
Officer of Fashion Neckwear Co., Inc., a manufacturer of men's neckties. Mr.
Sparks has acted as a consultant to Fashion Neckwear Co., Inc. since September
1995.
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<PAGE>
Bert DePamphilis has been a director of the Company since June 1990. Mr.
DePamphilis has been an independent consultant in the graphic arts industry
since May 1995. From September 1994 through April 1995 he was a consultant to
Applied Graphics Technology ("AGT"), the world's largest prepress service. Mr.
DePamphilis was the founder of, and from 1976 through August 1994, served as a
principal of PDR Royal, Inc., a color prepress service for advertising agencies
and Fortune 100 companies that ceased independent operations when it became a
division of AGT in September 1994.
John W. Dreyer has been a director of the Company since February 1996. Mr.
Dreyer has been employed by Pitman Company ("Pitman"), the largest graphic arts
and image supplier in the United States, since 1965. He has served as Pitman's
President since 1977 and has also served as its Chief Executive Officer since
1978.
Directors are elected annually by the stockholders. During the fiscal year
ended December 28, 1996, the Board of Directors held four meetings which were
attended by all of the directors except Mr. Sparks who was unable to attend two
meetings. In addition, the Board took other action by unanimous written consents
in lieu of a meeting. The Company does not have standing nominating or
compensation committees of the Board of Directors or committees performing
similar functions. The Company has an audit committee which supervises the audit
and financial procedures of the Company. The audit committee is currently
comprised of Messrs. Sparks and DePamphilis. The audit committee of the Board of
Directors did not hold any formal meetings during the fiscal year ended December
28, 1996.
EXECUTIVE OFFICERS
In addition to Richard A. Williams and Robert E. Verrando, the Company's
executive officers are Frank G. Pensavecchia, Glenn J. DiBenedetto and Richard
Loring. Officers are elected annually by the Board of Directors and serve at the
discretion of the Board.
Frank G. Pensavecchia, 62, has served as Senior Vice President-Engineering
of the Company since October 1991 and was the Company's Vice
President-Engineering from August 1988 to October 1991. From September 1987 to
August 1988, Mr. Pensavecchia served as the Company's Director of Engineering.
From October 1983 to September 1987, Mr. Pensavecchia served as Director of
Laser Printing Engineering for Centronics.
- 5 -
<PAGE>
Glenn J. DiBenedetto, 47, has served as Chief Financial Officer of the
Company since November 1990. Mr. DiBenedetto has been a principal with the firm
of DiBenedetto & Company, P.A., certified public accountants, since July 1989.
From 1984 to July 1989, Mr. DiBenedetto was a principal with the firm of Newton
& DiBenedetto, P.A., certified public accountants. Under his arrangement with
the Company, Mr. DiBenedetto engages in other activities and is not required to
devote his full business time to the affairs of the Company.
Richard Loring, 58, was elected as an Executive Vice President of the
Company on April 21, 1997. From February 1996 until his appointment as an
Executive Vice President, he served as a consultant to the Company. For more
than fifteen years prior thereto, Mr. Loring served as Corporate Senior Manager
of Polaroid Corp.
Legal Proceedings
In addition to the action entitled Bill Berke, et al. v. Presstek, Inc. et
al., referenced in the Company's Form 10-K for its fiscal year ended December
28, 1996, the following actions are pending in which certain of the Company's
directors and executive officers have been named as defendants:
On July 16, 1996, Richard Strauss commenced a derivative suit on behalf of
the Company in the Court of Chancery of the State of Delaware, New Castle
County, against Robert Howard, Lawrence Howard, Richard Williams, Robert
Verrando, Bert DePamphilis and Harold Sparks. The plaintiff alleges that the
defendants breached the fiduciary duties they each owed to the Company and its
other stockholders and wasted corporate assets by making false and misleading
statements of fact or concealing material facts concerning the viability of the
Company's "key" patent and its proprietary interest in its PEARL(R) technology,
its failure to properly disclose the scope of the investigation by the
Commission with respect to activities by certain unnamed persons and entities in
connection with the securities of the Company, and its misstatement of its
financial results for the first quarter of 1996, and that they used this
information for their personal use by selling common stock of the Company at
artificially inflated prices. The plaintiff also alleges that these actions by
the defendants resulted in breaches of Section 10(b) of the Securities Exchange
Act of 1934 ("Exchange Act") and Rule 10b-5 promulgated thereunder, which
resulted in other lawsuits being commenced against the Company which will
require the Company to expend resources to defend. The plaintiff seeks to
recover against the defendants, on behalf of the Company, unspecified damages
allegedly sustained by the Company as a results of the defendants' alleged
breaches of fiduciary duty, a return to the Company of all salaries and the
value of other remuneration paid to the defendants by the Company during the
time they were in breach of their fiduciary duties, and accounting of and/or
constructive trust on the proceeds of defendants' trading activities in the
Company's common stock and recovery of costs and disbursements of the action.
On March 14, 1997, James P. Cassidy commenced a derivative suit on behalf
of the Company in the United States District Court for the District of New
Hampshire, against Robert Howard,
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<PAGE>
Lawrence Howard, Richard Williams, Robert Verrando, Bert DePamphilis, Harold
Sparks and BDO Seidman, LLP. The plaintiff alleges that the individual
defendants breached the fiduciary duties they each owed to the Company and its
other stockholders and wasted corporate assets by making false and misleading
statements of fact or concealing material facts concerning the scope and
viability of the Company's "key" patents and its proprietary interest in its
PEARL(R) technology, causing the Company to issue false and misleading reports
or failure to disclose material facts including a misstatement of earnings in
the Company's financial statements for the year ending December 30, 1995, and
for the first quarter ending March 30, 1996 as a result of the allegedly
improper application of certain accounting principles relating to the tax
benefits received upon exercise of certain stock options previously granted by
the Company, and that they sold securities of the Company while they were in
possession of material non-public information concerning the Company. The
plaintiff also alleges that these actions by the individual defendants
constituted violations of Section 10(b) of the Exchange Act and Rule 10b-5
promulgated thereunder which resulted in other lawsuits being commenced against
the Company which will require the Company to expend resources to defend, and
also constituted gross negligence and breaches of these defendants' contractual
obligations to the Company. The plaintiff also alleges that BDO Seidman, LLP
negligently permitted the Company to issue financial statements for 1995 and the
first quarter of 1996 that were prepared in violation of recognized accounting
procedures. The plaintiff seeks to recover against the defendants, on behalf of
the Company, unspecified damages allegedly sustained by the Company as a result
of the defendants' actions as alleged, and recovery of costs, disbursements, and
fees of attorneys and experts by the plaintiff.
The Company intends to vigorously defend all of the foregoing actions.
EXECUTIVE COMPENSATION
The following table discloses the compensation for the person who served as
the Company's principal executive officer during the fiscal year ended December
28, 1996 and for the only other executive officers of the Company whose salaries
exceeded $100,000 for the Company's fiscal year ended December 28, 1996 (the
"Named Executives"). The number of securities underlying options has been
adjusted to give retroactive effect to the five-for-four split of the Company's
Common Stock effected in the form of a 25% stock dividend in September 1994 and
the two-for-one Common Stock split effected in the form of a 100% stock dividend
in May 1995.
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<PAGE>
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Annual Compensation
Compensation Awards
------------ ------
Securities
Name and Principal Salary Underlying
Position Year ($) Options (#)
- ------------------ ---- ----- -----------
<S> <C> <C> <C>
Richard A. Williams 1996 153,000 20,000
Chief Executive Officer 1995 134,000 --
1994 125,000 40,000
Robert E. Verrando 1996 179,000 20,000
President and Chief 1995 179,000 --
Operating Officer 1994 28,000 100,000
Frank G. Pensavecchia 1996 137,000 20,000
Senior Vice President - 1995 114,000 --
Engineering 1994 105,000 40,000
</TABLE>
No stock options were granted in fiscal 1995 to any of the Named
Executives.
The following table provides information with respect to individual stock
options granted during fiscal 1996 to each of the Named Executives.
Option Grants in Last Fiscal Year
Individual Grants
<TABLE>
<CAPTION>
Potential Realizable
% of Value at Assumed
Total Annual Rates of
Options Stock Price
Shares Granted to Appreciation for
Underlying Employees Exercise Option Term (1)
Options in Fiscal Price Expiration --------------------------
Name Granted (#) Year (2) ($/sh) Date 5%($) 10%($)
---- ----------- -------- ------ ---- ------ ------
<S> <C> <C> <C> <C> <C> <C>
Robert E. Verrando 20,000(3) 6.4 $71.00 12/2/01 $392,320 $866,924
Richard A. Williams 20,000(3) 6.4 $71.00 12/2/01 $392,320 $866,924
Frank G. Pensavecchia 20,000(3) 6.4 $71.00 12/2/01 $392,320 $866,924
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ----------------------
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<PAGE>
(1) The potential realizable value columns of the table illustrate values that
might be realized upon exercise of the options immediately prior to their
expiration, assuming the Company's Common Stock appreciates at the
compounded rates specified over the term of the options. These numbers do
not take into account provisions of certain options providing for
termination of the option following termination of employment or
nontransferability of the options and do not make any provision for taxes
associated with exercise. Because actual gains will depend upon, among
other things, future performance of the Common Stock, there can be no
assurance that the amounts reflected in this table will be achieved.
(2) The percentage has been calculated based upon total options granted to
employees in fiscal 1996 under the Company's 1988, 1991, and 1994 stock
option plans.
(3) Non-qualified stock options; all options were granted under the 1994 Stock
Option Plan and became exercisable on the date of grant, December 2, 1996.
The following table sets forth information concerning the value of
unexercised stock options held by the Named Executives as of December 28, 1996,
and the options exercised by the Named Executive Officers during the fiscal year
ended December 28, 1996.
Aggregated Option Exercises for Fiscal Year-Ended December 28, 1996
and Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Securities Underlying Value of Unexercised
Unexercised Options In-the-Money Options
at December 28, 1996 at December 28, 1996*
-------------------- ---------------------
Shares
Acquired Value
Name on Exercise Realized+ Exercisable Unexercisable Exercisable Unexercisable
---- ----------- --------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Richard A. Williams 50,000 $3,700,526 122,500 12,500 $6,651,750 $ 724,375
Robert E. Verrando 10,000 $ 966,563 55,000 55,000 $1,940,000 $2,970,000
Frank G. Pensavecchia 17,500 $1,701,094 92,500 12,500 $4,667,750 $ 724,375
</TABLE>
- ----------
+ Value realized represents the positive spread between the exercise price
of such options and the market value of the Common Stock on date of exercise.
* Year-end values for unexercised in-the-money options represent the
positive spread between the exercise price of such options and the year-end
market value of the Common Stock which was $73.50 on December 27, 1996.
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<PAGE>
Compensation of Directors
Directors received no cash compensation for serving on the Board during the
year ended December 28, 1996. However, during such year, the Company paid Mr.
Robert Howard, the Chairman of the Board, $125,000 for consulting services
rendered to the Company. In addition, in December 1996, Mr. Howard was granted a
five-year option under the Company's 1994 Plan (defined below) to purchase
20,000 shares of Common Stock at $71.00 per share.
Effective December 1993, the Company adopted its Non-Employee Director
Stock Option Plan (the "Director Plan"). Only non-employee directors of the
Company (other than Robert Howard or Dr. Lawrence Howard) are eligible to
receive grants under the Director Plan. The Director Plan provides that eligible
directors automatically receive a grant of options to purchase 5,000 shares of
Common Stock at fair market value upon first becoming a director and,
thereafter, an annual grant, in January of each year, of 2,500 options at fair
market value. In 1996, Messrs. DePamphilis and Sparks received options to
purchase 2,500 shares each of Common Stock under the Director Plan.
Since joining the Board in February 1996, in addition to the grants of
five-year options to purchase 7,500 shares of Common Stock that he received
pursuant to the Director Plan, Mr. Dreyer has been granted under the 1994 Plan
options to purchase 5,000, 2,500, and 10,000 shares of Common Stock,
respectively, at exercise prices of $94.75, $99.25, and $70.25, respectively.
Under each of the Company's 1988 Stock Option Plan ("1988 Plan"), 1991
Stock Option ("1991 Plan") and 1994 Stock Option Plan ("1994 Plan"), directors
who are not employees of the Company (other than directors who are members of
the Stock Option Committee of the particular plan) are eligible to be granted
nonqualified options under such plan. The Board of Directors or the Stock Option
Committee (the "Committee") of each plan, as the case may be, has discretion to
determine the number of shares subject to each nonqualified option (subject to
the number of shares available for grant under the particular plan), the
exercise price thereof (provided such price is not less than the par value of
the underlying shares of Common Stock), the term thereof (but not in excess of
10 years from the date of grant, subject to earlier termination in certain
circumstances), and the manner in which the option becomes exercisable (amounts,
intervals and other conditions). Directors who are employees of the Company (but
not members of the Committee of the particular plan) are eligible to be granted
incentive stock options or nonqualified options under such plans. The Board or
Committee of each plan, as the case may be, also has discretion to determine the
number of shares subject to each incentive stock option ("ISO"), the exercise
price and other terms and conditions thereof, but their discretion as to the
exercise price, the term of each ISO and the number of ISOs that may vest may be
in any year is limited by the Internal Revenue Code
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<PAGE>
of 1986, as amended. As of February 25, 1997, there were 4,382 shares of Common
Stock available for grant under the 1988 Plan, 6,016 shares of Common Stock
available for grant under the 1991 Plan, 224,976 shares available for grant
under the 1994 Plan and 85,000 shares of Common Stock available for grant under
the Director Plan.
Employment Arrangements
The Company has an employment agreement with Mr. Richard A. Williams, which
provides for an annual salary which is subject to periodic review by the
Company's Board of Directors. The employment agreement expires on March 31,
1998, and contains certain non-disclosure provisions. Effective January 1997,
the Board increased Mr. Williams' annual salary to $175,000.
Compensation Committee Interlocks and Insider Participation in
Compensation Decisions
The Company does not have a Compensation Committee of its Board of
Directors. Decisions as to compensation are made by the Company's Board of
Directors. Mr. Richard A. Williams, and Mr. Robert E. Verrando, in their
capacity as a director, each participated in the Board's deliberations
concerning compensation of executive officers for the Company's fiscal year
ended December 28, 1996. During the fiscal year ended December 28, 1996, none of
the executive officers of the Company has served on the Board of Directors or
the compensation committee of any other entity, any of whose officers has served
on the Board of Directors of the Company.
Report on Executive Compensation
As noted above, there is no Compensation Committee of the Board of
Directors or other committee of the Board performing equivalent functions.
Compensation of the Company's executive officers is determined by the Board of
Directors pursuant to recommendations made by Robert Howard, Chairman of the
Board. There is no formal compensation policy for the Company's executive
officers.
The Board of Directors has appointed a Stock Option Committee, currently
comprised of Messrs. Sparks and DePamphilis, for each of the 1991 and 1994
Plans, which has made grants under, and has administered, the 1991 and 1994
Plans.
Total compensation for executive officers consists of a combination of
salaries and stock option awards. The salary of Richard A. Williams, the
Company's Chief Executive Officer, is fixed annually by the Board of Directors
pursuant to the terms of his employment agreement with the Company. Base salary
of other
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<PAGE>
executive officers is based on the Company's financial performance and the
executive's individual performance and level of responsibility. Bonus
compensation, if any, to executive officers is based generally upon the
Company's financial performance and the availability of resources as well as the
executive officer's individual performance and level of responsibility. Stock
option awards under the Company's 1988, 1991 and 1994 Stock Option Plans are
intended to attract, motivate and retain senior management personnel by
affording them an opportunity to receive additional compensation based upon the
performance of the Company's Common Stock. No stock options were granted to
executive officers of the Company during the fiscal year ended December 28, 1996
except for five-year non-qualified options to purchase 20,000 shares of the
Company's Common Stock at $71.00 per share which were granted to each of Messrs.
Williams, Verrando and Pensavecchia in December 1996.
During 1996, the Company earned approximately $7,120,000 on revenues of
approximately $48,627,000, compared to earnings of approximately $2,860,000 on
revenues of approximately $27,611,000 in 1995.
Robert Howard
Richard A. Williams
Robert E. Verrando
Dr. Lawrence Howard
Harold N. Sparks
Bert DePamphilis
John W. Dreyer
- 12 -
<PAGE>
Stock Performance Graph
The following line graph compares, from January 1, 1992, through December
28, 1996, the cumulative total return among the Company, companies comprising
the NASDAQ Market Index and a Peer Group Index, based on an investment of $100
on January 1, 1992, in the Company's Common Stock and each index, and assuming
reinvestment of all dividends, if any, paid on such securities. The Company has
not paid any cash dividends and, therefore, the cumulative total return
calculation for the Company is based solely upon stock price appreciation and
not upon reinvestment of cash dividends. The Peer Group Index consists of
companies in the Standard Industrial Classification's printing trades machinery
and equipment industry group. These companies are: AM International Inc.,
Baldwin Technology Company, Inc., Champion Industries, Inc., Check Technology
Corp., Indigo N.V., Lasermaster Technology, NUR Advanced Technology Limited,
Scitex Corporation Ltd., Stevens International, Inc. and Xeikon N.V. Historic
stock price is not necessarily indicative of future stock price performance.
<TABLE>
<CAPTION>
1/1/92 12/31/92 12/31/93 12/31/94 12/30/95 12/28/96
------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Presstek $100.00 $94.74 $117.89 $265.79 $994.74 $773.68
Inc.
Peer Group $100.00 $114.98 $76.15 $73.07 $55.95 $36.85
Index
NASDAQ $100.00 100.98 $121.13 $127.17 $164.96 $204.98
Market
Index
</TABLE>
VOTING SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of the Record Date,
based on information obtained from the persons named below, with respect to the
beneficial ownership of shares of Common Stock by (i) each person known by the
Company to be the beneficial owner of more than five percent of the outstanding
shares of Common Stock, (ii) each of the Named Executives, (iii) each of the
Company's directors and (iv) all executive officers and directors as a group:
- 13 -
<PAGE>
Amount and Nature Percentage
Name of of Beneficial of Outstanding
Beneficial Owner (1) Ownership (2) Shares Owned
- -------------------- ----------------- -------------
Robert Howard 1,370,724(3) 8.7
Dr. Lawrence Howard 1,354,326(4) 8.7
Richard A. Williams 331,400(5) 2.1
Robert E. Verrando 55,000(6) (7)
Harold N. Sparks 47,900(8) (7)
Bert DePamphilis 16,050(9) (7)
Frank Pensavecchia 105,000(10) (7)
John W. Dreyer 22,500(11) (7)
John C. Oxley 997,300(12)(13) 6.5
Thomas E. Oxley 806,700(12)(14) 5.2
Charles C. Killin 813,200(12)(15) 5.3
All executive officers
and directors as a
group (ten persons) 3,309,900(16) 20.1
- ----------
(1) The address of Dr. Lawrence Howard is 120 East End Avenue, New York, New
York 10028. The address of Robert Howard is 303 East 57th Street, New York,
New York 10022.
(2) The Company believes that except as set forth herein, all persons referred
to in the table have sole voting and investment power with respect to all
shares of Common Stock reflected as beneficially owned by them.
(3) Includes options to purchase 279,000 shares of Common Stock held by Mr.
Howard which are currently exercisable. Also includes 12,000 shares owned
by Mr. Howard's wife. Does not include shares owned by the son of Mr.
Howard's wife, with respect to which Mr. Howard disclaims any beneficial
interest.
(4) Includes options to purchase 131,500 shares of Common Stock held by Dr.
Howard which are currently exercisable. Also includes 17,500 shares owned
by Dr. Howard's wife, 26,892 shares owned by Dr. Howard's wife as custodian
for Dr. Howard's children and 22,500 shares owned by Dr. Howard as
custodian for his children.
(5) Includes options to purchase 122,500 shares of Common Stock held by Mr.
Williams which are currently exercisable. Also includes 11,000 shares owned
by Mr. Williams' wife. Does not include shares owned by Mr. Williams'
children with respect to which Mr. Williams disclaims any beneficial
interest.
(6) Represents shares issuable upon exercise of options held by Mr. Verrando
which are currently exercisable.
(7) Less than 1%.
- 14 -
<PAGE>
(8) Includes options to purchase 13,750 shares of Common Stock held by Mr.
Sparks which are currently exercisable.
(9) Includes options to purchase 13,750 shares of Common Stock held by Mr.
DePamphilis which are currently exercisable.
(10) Includes options to purchase 92,500 shares of common stock held by Mr.
Pensavecchia which are currently exercisable.
(11) Represents shares issuable upon exercise of options held by Mr. Dreyer
which are currently exercisable.
(12) The information with respect to the securities ownership of Messrs. John C.
Oxley, Thomas E. Oxley, and Charles C. Killin has been derived from their
respective Schedules 13-D as filed with the Securities and Exchange
Commission.
(13) Represents 19,600 shares of Common Stock held by Mr. Oxley, individually;
750,700 shares of Common Stock held by Mr. Oxley as a co-executor of the
estate of John T. Oxley (the "Oxley Estate"); 171,000 shares of Common
Stock held by Mr. Oxley as a co-trustee of the Oxley Foundation; and 56,000
shares of Common Stock held of record by Boca Polo, Inc. ("Boca Polo") a
Nevada corporation. Mr. Oxley is owner of 50% of the outstanding shares of
Boca Polo. The address of Mr. John C. Oxley is One West 3rd Street,
Williams Center Tower I, Suite 1300, Tulsa, OK 74103.
(14) Represents 750,700 shares of Common Stock held by the Oxley Estate, of
which Mr. Oxley is a co-executor; and 56,000 shares of Common Stock held of
record by Boca Polo. Mr. Oxley is a director and owner of 50% of the
outstanding shares of Boca Polo. The address of Mr. Thomas E. Oxley is One
West 3rd Street, Williams Center Tower I, Suite 1305, Tulsa, OK 74103.
(15) Represents 750,700 shares of Common Stock held by Mr. Killin as a
co-executor of the Oxley Estate; 43,500 of Common Stock held by Mr. Killin
as the trustee of the Mary Jane Tritsch Trust dated September 3, 1952; and
19,000 shares of Common Stock held by Mr. Killin as the trustee of the
Thomas E. Oxley Trust dated September 3, 1952. The address for Mr. Killin
is 15 East 5th Street, Suite 2400, Tulsa, OK 74103.
(16) Includes options to purchase 279,000, 131,500, 122,500, 55,000, 92,500,
13,750, 13,750, 22,500, and 7,000 shares held by Robert Howard, Dr.
Lawrence Howard, Richard A. Williams, Robert E. Verrando, Frank
Pensavecchia, Bert DePamphilis, Harold Sparks, John W. Dreyer, and Glenn J.
DiBenedetto, respectively, which are currently exercisable. Does not
include options to purchase 12,500, 55,000, 12,500, 2,500, 2,500, and 2,500
shares of Common Stock held by Richard A. Williams, Robert E. Verrando,
Frank Pensavecchia, Harold Sparks, Bert DePamphilis and John W. Dreyer,
respectively,
- 15 -
<PAGE>
none of which are exercisable within 60 days from the Record Date. Also
does not include options to purchase 50,000 shares of Common Stock which
are not exercisable within 60 days of the Record Date granted to Richard
Loring, who was appointed as an executive officer of the Company on April
21, 1997.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company paid Mr. Robert Howard, its Chairman of the Board, $125,000 for
consulting services provided to the Company during 1996. In addition, the
Company paid Mr. Howard $35,513 as a tenant-at-will sublessee of certain offices
from Mr. Howard.
During the year ended December 28, 1996, the Company purchased equipment
from Howtek totaling $53,721. Mr. Robert Howard, is the Chairman of the Board of
Directors and a principal stockholder of Howtek, and the father of Dr. Lawrence
Howard. Dr. Howard currently serves as a director to the Company.
During 1996, the Company recorded sales of equipment and consumables to
Pitman of $3,379,000, and had accounts receivable from Pitman of $2,279,000 at
December 28, 1996. John Dreyer, who has been a director of the Company since
February 1996, is Pitman's President and Chief Executive Officer.
- 16 -
<PAGE>
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
BDO Seidman, LLP has audited and reported upon the financial statements of
the Company for the fiscal year ended December 28, 1996. As has been the
practice in previous years, the auditors who will examine and report upon the
financial statements of the Company for the fiscal year ending January 3, 1998
will be appointed prior to commencement of the audit. A representative of BDO
Seidman, LLP is expected to be present at the Annual Meeting with the
opportunity to make a statement if he or she desires to do so and is expected to
be available to respond to appropriate questions.
On December 28, 1995, the Company dismissed Deloitte & Touche LLP
("Deloitte & Touche") as its principal independent accountant.
Neither of Deloitte & Touche's reports on the financial statements of the
Company for the fiscal years ended December 31, 1994 or December 31, 1993
contained an adverse opinion or a disclaimer of opinion, nor was qualified or
modified as to uncertainty, audit scope or accounting principles (except for the
change in the method of accounting for debt and equity securities effected
January 1, 1994, to conform to SFAS No. 115).
The decision to change accountants was recommended by the Audit Committee
of the Company's Board of Directors and approved by the Company's Board of
Directors.
It is the Company's opinion that during the fiscal years ended December 31,
1994 and December 31, 1993 and during the period from January 1, 1995 through
December 28, 1995, there were no disagreements with Deloitte & Touche on any
matter of accounting principles or practices, financial statement disclosure or
auditing scope or procedure or any reportable event. Deloitte & Touche, however,
has advised the Company that it considers the following item to be a
disagreement:
During the course of its audit of the Company's financial statements for
the fiscal year ended December 31, 1994 the Company notified Deloitte & Touche
that:
The Company has been advised that the Securities and Exchange Commission
(the "Commission") has entered a formal order of private investigation with
respect to certain activities by certain unnamed persons and entities in
connection with the securities of the Company. In that connection, the
Company has received a subpoena duces tecum requesting it to produce
certain documents and has complied with the request. The Company has not
been advised by the Staff of the Commission that
- 17 -
<PAGE>
the Staff intends to recommend to the Commission that it initiate a
proceeding against the Company in connection with the foregoing
investigation.
Management of the Company initially proposed to include disclosure of this
matter under Item 5, Market for the Registrant's Common Equity and Related
Stockholder Matters, in the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1994 (the "1994 10-K"), while declining to include
parallel disclosure in the notes to the Company's financial statements included
in the 1994 10-K.
Deloitte & Touche advised the Company that "Because of the potential
significance of such an investigation to the readers of the Company's financial
statements we [Deloitte & Touche] concluded that generally accepted accounting
principles and Rule 4- 01 of Securities and Exchange Commission Regulation S-X
require that disclosure of this matter be included in the notes to the Company's
financial statements. The disclosure was included as Note 11, Other Information,
to the financial statements."
As noted above, the disclosure of the investigation was included in the
notes to the Company's financial statements included in the 1994 10-K.
The issue of the disclosure of the Commission's investigation in the
Company's financial statements was discussed with the engagement partner of
Deloitte & Touche and certain members of the Company's Board of Directors and
the Company's Chief Financial Officer.
The Company authorized Deloitte & Touche to respond fully to any inquiries
the successor accountant engaged by the Company may have concerning the above
matters.
On January 11, 1996, the Company engaged BDO Seidman, LLP as its principal
independent accountants to audit and report on the financial statements of the
Company for the fiscal year ended December 30, 1995. Prior to engaging BDO
Seidman, LLP neither the Company, nor anyone acting on its behalf consulted with
it regarding the application of accounting principles to any specified
transaction or the type of audit opinion that might be rendered on the Company's
financial statements. In addition, neither the Company nor anyone acting on its
behalf consulted with BDO Seidman, LLP with respect to any matters that were the
subject of a disagreement (as defined in paragraph 304(a)(1)(v) of Regulation
S-K) except that in connection with the preparation's of the 1994 10-K counsel
for the Company had general discussions with a partner at BDO Seidman, LLP with
respect to the need to disclose the investigation by the Commission of certain
activities of certain persons and entities in the securities of the Company in
the financial statements included in the 1994 10-K, as was the position of the
Company's former auditors, even though disclosure of the
- 18 -
<PAGE>
investigation was to be included in the non-financial portion of the 1994 10-K.
No conclusion was expressed by the partner at BDO Seidman, LLP with respect to
the matter.
STOCKHOLDER PROPOSALS FOR 1997 ANNUAL MEETING
Stockholders who wish to present proposals appropriate for consideration at
the Company's Annual Meeting of Stockholders to be held in 1998 must submit the
proposal in proper form to the Company at its address set forth on the first
page of this Proxy Statement not later than December 23, 1997 in order for the
proposition to be considered for inclusion in the Company's proxy statement and
form of proxy relating to such annual meeting. Any such proposals, as well as
any questions related thereto, should be directed to the Secretary of the
Company.
OTHER INFORMATION
Proxies for the Annual Meeting will be solicited by mail and through
brokerage institutions and all expenses involved, including printing and
postage, will be paid by the Company.
A COPY OF THE COMPANY'S ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 28, 1996
IS BEING FURNISHED HEREWITH TO EACH STOCKHOLDER OF RECORD AS OF THE CLOSE OF
BUSINESS ON THE RECORD DATE. COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K
WILL BE PROVIDED FOR A NOMINAL CHARGE UPON WRITTEN REQUEST TO:
PRESSTEK, INC.
8-9 COMMERCIAL STREET
HUDSON, NEW HAMPSHIRE 03051
ATTENTION: JENNIFER MCKAY TARDIF
The Board of Directors is aware of no other matters, except for those
incident to the conduct of the Annual Meeting, that are to be presented to
stockholders for formal action at the Annual Meeting. If, however, any other
matters properly come before the Annual Meeting or any adjournments thereof, it
is the intention of the persons named in the proxy to vote the proxy in
accordance with their judgment.
We would appreciate it if registered stockholders will give us advance
notice of their plans to attend the Annual Meeting Annual Meeting by marking the
appropriate box provided on the enclosed proxy card.
By order of the Board
of Directors,
Robert Howard
Chairman of the Board
April 23, 1997
- 19 -
<PAGE>
PRESSTEK, INC.
8-9 Commercial Street
Hudson, New Hampshire 03051
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 30, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints RICHARD A. WILLIAMS and ROBERT E. VERRANDO,
and each of them, Proxies, with full power of substitution in each of them, in
the name, place and stead of the undersigned, to vote at the Annual Meeting of
Stockholders of Presstek, Inc. on Friday, May 30 1997, at 55 Executive Drive,
Hudson, New Hampshire or at any adjournment or adjournments thereof, according
to the number of votes that the undersigned would be entitled to vote if
personally present, upon the following matters:
1. ELECTION OF DIRECTORS:
|_| FOR all nominees listed below
(except as marked to the contrary below).
|_| WITHHOLD AUTHORITY
to vote for all nominees listed below.
Robert Howard, Richard A. Williams, Robert E. Verrando, Dr.
Lawrence Howard, Harold N. Sparks, Bert DePamphilis and John W. Dreyer
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space below.)
- --------------------------------------------------------------------------------
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
(continued and to be signed on reverse side)
<PAGE>
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS GIVEN ABOVE.
IF NO INSTRUCTIONS ARE GIVEN, THIS PROXY WILL BE VOTED FOR THOSE NOMINEES
AND THE PROPOSALS LISTED ABOVE.
DATED: ________________________________, 1997
Please sign exactly as name appears
hereon. When shares are held by joint
tenants, both should sign. When signing
as attorney, executor, administrator,
trustee 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.
_________________________________________
Signature
_________________________________________
Signature if held jointly
Please mark, sign, date and return this proxy card promptly using the
enclosed envelope.
Please indicate whether or not you will attend the Annual Meeting of
Stockholders by marking the appropriate box below.
I |_| will |_| will not attend the Annual Meeting.
