<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / 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 Rule 14a-11(c) or Rule 14a-12
</TABLE>
Comptronix Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
[COMPTRONIX CORPORATION LOGO]
Three Maryland Farms, Suite 140
Brentwood, Tennessee 37027
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Notice is hereby given that the Annual Meeting of Stockholders (the "Annual
Meeting") of Comptronix Corporation (the "Company") will be held at 10:00 a.m.
on Tuesday, June 4, 1996, at The Maryland Farms Athletic Club, 5101 Maryland
Way, Brentwood, Tennessee, for the following purposes:
1. To elect five (5) directors to hold office until the next Annual
Meeting and until their successors are elected and qualified; and
2. To transact such other business as may properly come before the
Annual Meeting.
The Board of Directors has fixed the close of business on April 9, 1996 as
the record date for the determination of stockholders entitled to notice of and
to vote at the Annual Meeting.
Your attention is directed to the Proxy Statement accompanying this notice
for a more complete statement regarding matters to be acted upon at the Annual
Meeting.
By Order of the Board of Directors
/s/ Joseph G. Andersen
----------------------
Joseph G. Andersen,
Secretary
Brentwood, Tennessee
May 1, 1996
YOUR REPRESENTATION AT THE ANNUAL MEETING IS IMPORTANT. TO ENSURE YOUR
REPRESENTATION, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY. SHOULD YOU DESIRE TO REVOKE
YOUR PROXY, YOU MAY DO SO AS PROVIDED IN THE ACCOMPANYING PROXY STATEMENT AT ANY
TIME BEFORE IT IS VOTED.
<PAGE> 3
[COMPTRONIX CORPORATION LOGO]
THREE MARYLAND FARMS, SUITE 140
BRENTWOOD, TENNESSEE 37027
------------------------
PROXY STATEMENT
------------------------
The accompanying proxy is solicited by the Board of Directors of Comptronix
Corporation (the "Company") for use at the Annual Meeting of Stockholders (the
"Annual Meeting") to be held on June 4, 1996 at The Maryland Farms Athletic
Club, 5101 Maryland Way, Brentwood, Tennessee, and any adjournments thereof,
notice of which is attached hereto.
The purposes of the Annual Meeting are to elect 5 directors and to transact
such other business as may properly be brought before the Annual Meeting or any
adjournment thereof.
A stockholder who signs and returns a proxy may revoke the same at any time
before the authority granted thereby is exercised by attending the Annual
Meeting and electing to vote in person, by filing with the Secretary of the
Company a written revocation or by duly executing a proxy bearing a later date.
Unless so revoked, the shares represented by the proxy will be voted at the
Annual Meeting. Where a choice is specified on the proxy, the shares represented
thereby will be voted in accordance with such specification. If no specification
is made, such shares will be voted FOR the election of the 5 director nominees.
The Board of Directors knows of no other matters which are to be brought to
a vote at the Annual Meeting. However, if any other matter properly does come
before the Annual Meeting, the persons appointed in the proxy or their
substitutes will vote in accordance with their best judgment on such matters.
The Board of Directors has fixed the close of business on April 9, 1996 as
the record date for the Annual Meeting (the "Record Date"). Only record holders
of the Company's common stock, $.01 par value per share (the "Common Stock"), at
the close of business on that date will be entitled to vote at the Annual
Meeting. On the Record Date, the Company had outstanding 13,163,410 shares of
Common Stock. Holders of the Common Stock will be entitled to one vote for each
share of Common Stock so held, which may be given in person or by proxy duly
authorized in writing.
The representation in person or by proxy of at least a majority of the
outstanding shares entitled to vote is necessary to provide a quorum at the
Annual Meeting. The directors shall be elected by a plurality of the votes cast
in the election by the holders of the Common Stock represented and entitled to
vote at the Annual Meeting. Any other matters submitted to the stockholders
shall be approved by the affirmative vote of a majority of the votes cast by the
holders of Common Stock represented and entitled to vote at the Annual Meeting.
Abstentions and "non-votes" will be counted as present for purposes of
determining a quorum for the transaction of business. Abstentions are counted in
tabulations of the votes cast on proposals (other than the election of
directors) presented to stockholders, whereas "non-votes" are not counted for
purposes of determining whether a proposal has been approved. A "non-vote"
occurs when a nominee holding shares for a beneficial owner votes on one
proposal, but does not vote on another proposal because the nominee does not
have discretionary voting power and has not received instructions from the
beneficial owners.
The cost of solicitation of proxies will be borne by the Company, including
expenses in connection with preparing, assembling and mailing this Proxy
Statement. Such solicitation will be made by mail, and also may be made by the
Company's executive officers or employees personally or by telephone or
telegram. The Company does not anticipate paying any compensation to any party
other than its regular employees for the solicitation of proxies, but may
reimburse brokerage firms and others for their reasonable expenses in forwarding
solicitation material to beneficial owners.
This Proxy Statement and the Company's Annual Report to Stockholders (the
"Annual Report") will be mailed on or about May 1, 1996, to all stockholders of
record at the close of business on April 9, 1996.
<PAGE> 4
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth the beneficial ownership as of the Record
Date of (i) each director, (ii) each of the executive officers named in the
Summary Compensation Table (collectively, the "Named Executive Officers") and
(iii) the executive officers and directors as a group. No person, entity or
group known to the Company is the beneficial owner of more than five percent of
the Common Stock. Unless otherwise noted, the Company believes that the
beneficial owner set forth in the table has sole voting and investment power
with respect to the indicated shares.
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED ON
NAME APRIL 9, 1996(1) PERCENT OF CLASS
- ----------------------- ---------------------- ----------------
<S> <C> <C> <C>
E. Townes Duncan(2)(3).................................... 223,960(4) 1.7%
Lonnie J. Stout II(2)..................................... 20,000(5) *
Richard W. Oliver(2)...................................... 21,000(5) *
J C. Bowling(2)........................................... 23,500(5) *
Howard H. Graham (2)...................................... 24,000(5)(6) *
Paul D. Johns(3).......................................... 24,000(7)(8) *
Michael C. Thompson(3).................................... 18,750(8)(9) *
Joseph G. Andersen(3)..................................... 21,870(10) *
David E. Nesbit(3)........................................ 17,823(8)(11) *
All directors and executive officers as a group (9
persons)................................................ 394,903(12) 3.0
</TABLE>
- ---------------
* less than one percent.
(1) Pursuant to the rules of the Securities and Exchange Commission (the
"Commission"), certain shares of the Common Stock set forth in this table
which an individual owner has a right to acquire within 60 days after the
Record Date pursuant to the exercise of stock options or the conversion of
the Company's 6 3/4% Convertible Subordinated Debentures Due 2002 are
deemed outstanding for the purpose of computing the beneficial ownership of
that owner and for all directors and executive officers as a group, but are
not deemed outstanding for the purpose of computing the ownership of any
other individual owner shown in the table.
(2) Director
(3) Named Executive Officer
(4) 85,833 of the shares indicated are subject to restrictions on transfer
which lapse over time pursuant to restricted stock awards by the Company.
Mr. Duncan, however, is entitled to vote and receive dividends paid on such
restricted shares. See "Executive Compensation." Also includes 8,100 shares
held by an investment partnership of which Mr. Duncan is a partner, 4,500
shares held in trust for Mr. Duncan's children, 1,500 shares held by Mr.
Duncan's wife and 62,750 shares which may be acquired by Mr. Duncan upon
the exercise of outstanding options. Mr. Duncan disclaims ownership of the
shares held by his wife and the trust for his children.
(5) Includes 19,000 shares which may be acquired upon the exercise of
outstanding options.
(6) Includes 5,000 shares held by a trust of which Mr. Graham is a trustee.
(7) Includes 14,000 shares which may be acquired upon the exercise of
outstanding options.
(8) 5,000 of the shares indicated are subject to restrictions on transfer which
lapse over a period of four years pursuant to restricted stock awards by
the Company. The indicated person, however, is entitled to vote and receive
dividends paid on such restricted shares.
(9) Includes 12,750 shares which may be acquired upon the exercise of
outstanding options.
(10) Includes 11,500 shares which may be acquired upon the exercise of
outstanding options and 10,000 shares subject to restrictions on transfer
which lapse over a period of four years pursuant to a restricted stock
award by the Company. Mr. Andersen, however, is entitled to vote and
receive dividends paid on such restricted shares. Also includes 230 shares
held in the name of Mr. Andersen's wife. Mr. Andersen disclaims beneficial
ownership of these shares. Mr. Andersen owns ten shares of the Company's
Series A Convertible Preferred Stock.
(11) Includes 7,750 shares which may be acquired upon the exercise of
outstanding options.
(12) Includes 184,750 shares which may be acquired upon the exercise of
outstanding options and 110,833 shares subject to restrictions on transfer
which lapse over time pursuant to restricted stock awards by the Company.
2
<PAGE> 5
PROPOSAL I:
ELECTION OF DIRECTORS
Directors are elected each year to hold office until the next annual
meeting of stockholders and until their successors are duly elected and
qualified. The Company's Bylaws provide for a minimum of seven (7) and a maximum
of fifteen (15) directors, the exact number to be set by the Board of Directors.
The current Board of Directors consists of five members, all of whom are
nominees to be elected as directors at the Annual Meeting. Two vacancies
presently exist on the Board of Directors. Proxies may not be voted for a
greater number of directors than five.
Unless contrary instructions are received, the enclosed proxy will be voted
in favor of the election as directors of the nominees listed below. Each nominee
has consented to be a candidate and to serve, if elected. While the Board of
Directors has no reason to believe that any nominee will be unable to accept
nomination or election as a director, if such an event should occur, the proxy
will be voted with discretionary authority for a substitute or substitutes as
shall be designated by the current Board of Directors.
The following table contains certain information concerning the nominees
which has been furnished to the Company by the individuals named.
<TABLE>
<CAPTION>
DIRECTOR
NOMINEE AGE SINCE POSITION
---------------------- --- -------- -------------------------------------------------
<S> <C> <C> <C>
E. Townes Duncan...... 42 1988 Chairman of the Board, Chief Executive Officer,
President and Director
Lonnie J. Stout II.... 49 1993 Director
Richard W. Oliver..... 49 1993 Director
J C. Bowling.......... 57 1994 Director
Howard H. Graham...... 49 1994 Director
</TABLE>
The following is a brief summary of the business experience of each of the
nominees.
E. TOWNES DUNCAN was appointed Chairman of the Board and Chief Executive
Officer in April 1993 by the Board of Directors, and assumed the position of
President in July 1995. Prior to April 1993, Mr. Duncan had served the Company
as Interim Chairman of the Board and Interim Chief Executive Officer since
November 1992. Mr. Duncan has been a director of the Company since 1988. From
1985 until November 1993, when Mr. Duncan resigned to devote his full-time
attention to the Company, he served as a vice president and a principal of
Massey Burch Investment Group, Inc., a venture capital organization
headquartered in Nashville, Tennessee. Previously, Mr. Duncan was an attorney
with the law firm of Bass, Berry & Sims in Nashville from 1978 until 1985. Mr.
Duncan is a director of Volunteer Capital Corporation, an owner and operator of
restaurants, and Sirrom Capital Corporation, a small business investment
company.
LONNIE J. STOUT II was elected a director at the Company's 1993 Annual
Meeting of Stockholders. He has been the President and Chief Executive Officer
of Volunteer Capital Corporation since May 1986. Since July 1990, Mr. Stout also
has served as Chairman of Volunteer Capital Corporation. From 1984 to 1986, Mr.
Stout served as President and a director of DineLite Corporation, a food service
company. Mr. Stout formerly served Volunteer Capital Corporation from 1982 to
May 1984 as a director and served as Executive Vice President and Chief
Financial Officer from 1981 to 1984.
RICHARD W. OLIVER became a director of the Company in December 1993 and has
been a professor at the Owen School of Management at Vanderbilt University since
September 1992. Prior to such time, Mr. Oliver served as a vice president of
marketing and in other positions in marketing and communications at Northern
Telecom from 1976 until joining the faculty at Vanderbilt University. Mr. Oliver
is a director of Communications Central, Inc., a provider of public pay
telephone services, and Applied Innovation, Inc., a manufacturer of data
communication equipment in the telephone industry.
3
<PAGE> 6
J C. BOWLING became a director of the Company in February 1994. Mr. Bowling
served as Executive Vice President of Circuit Concepts, Inc., a manufacturer of
printed circuit boards from June 1994 to June 1995, and remains a director and
consultant with such company. From 1979 to 1994, Mr. Bowling served as Vice
President of Operations of Critikon, Inc., a division of Johnson & Johnson, Inc.
In addition to his position with Critikon, Inc., Mr. Bowling served Johnson &
Johnson, Inc. in a variety of increasingly responsible management positions
since 1966.
HOWARD H. GRAHAM became a director of the Company in April 1994. He has
served as Senior Vice President-Finance and Chief Financial Officer of Informix
Corp., a database software company, since March 1990. From 1988 to February
1990, he was Senior Vice President-Finance and Administration and Chief
Financial Officer of Wyse Technology, Inc., a computer and peripheral
manufacturer. Prior to such time, Mr. Graham held a series of increasingly
responsible financial management positions during a fifteen year career at
Zenith Electronics Corporation, including Vice President-Finance and Chief
Financial Officer from 1987 until leaving Zenith in 1988.
The Board of Directors has an Audit Committee which is comprised of Messrs.
Stout, Oliver, Bowling and Graham. The purposes of the Audit Committee include
recommending the Company's auditors, reviewing the scope of their engagement,
consulting with such auditors, reviewing the results of the audit examination,
acting as a liaison between the Board of Directors and the Company's internal
auditors, reviewing various Company policies, including those related to
accounting and internal controls matters, and monitoring compliance with the
undertakings made by the Company in its securities class action litigation
settlement related to the improper accounting scheme engaged in by former
members of the Company's management. The Audit Committee met four times during
the fiscal year ended December 31, 1995.
The Board of Directors has a Compensation Committee for the purpose of
setting officers' salaries, formulating bonuses for the Company's management and
administering the Company's stock incentive plans. Messrs. Stout, Oliver,
Bowling and Graham also comprise the Compensation Committee. The Compensation
Committee met four times during the fiscal year ended December 31, 1995. See
"Executive Compensation -- Compensation Committee Report on Executive
Compensation."
The Board of Directors held four meetings during the fiscal year ended
December 31, 1995. All incumbent directors attended more than 75% of meetings of
the Board of Directors and the respective committees of which they are members.
The Board of Directors does not have a nominating committee.
4
<PAGE> 7
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table summarizes the compensation paid or accrued by the
Company during the three fiscal years ended December 31, 1995 for (i) the Chief
Executive Officer of the Company and (ii) the Company's four most highly
compensated executive officers (other than the Chief Executive Officer) who were
serving as executive officers at the end of the Company's last fiscal year
(collectively, the "Named Executive Officers").
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
------------------------------
ANNUAL COMPENSATION
------------------------------ AWARDS
OTHER ------------------------------
ANNUAL SECURITIES
COMPEN- RESTRICTED UNDERLYING ALL OTHER
SALARY BONUS SATION STOCK AWARDS OPTION(S)/SARS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($)
- ------------------------------- ---- -------- ------- ------- ------------ -------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
E. Townes Duncan............... 1995 $226,550 $ 0 $34,481(2) $ 18,100(3) 210,000(4) $4,001(5)
Chairman of the Board, Chief 1994 229,558 0 9,755 (2) 0 1,000 6,316
Executive Officer and 1993 205,000 0 0 475,000(6) 0 4,260
President(1)
Joseph G. Andersen............. 1995 110,578 0 2,017 (2) 18,100(3) 40,000 773(5)
Vice President, Chief 1994 79,539 0 0 0 21,000 551
Financial Officer and 1993 73,476 0 0 0 10,000 20
Secretary
Paul D. Johns.................. 1995 98,550 0 479 (2) 11,400(3) 75,000(4) 2,470(5)
Vice President of Human 1994 119,529 0 0 0 1,000 2,934
Resources 1993 n/a n/a n/a n/a n/a n/a
Michael C. Thompson............ 1995 115,917 0 951 (2) 9,050(3) 70,000(4) 1,061(5)
Vice President 1994 112,126 0 0 0 1,000 1,017
1993 50,866 0 0 0 0 92
David E. Nesbit................ 1995 100,040 0 1,006 (2) 9,050(3) 45,000(4) 930(5)
Vice President 1994 107,250 0 0 0 6,000 1,103
1993 111,923 0 0 0 0 792
</TABLE>
- ---------------
(1) Mr. Duncan was appointed Chairman of the Board and Chief Executive Officer
in April 1993 by the Board of Directors. Prior to such time, Mr. Duncan had
served the Company as Interim Chairman of the Board and Interim Chief
Executive Officer since November 1992. The Board of Directors authorized
the payment of $5,000 per week plus reimbursement of any out-of-pocket
expenses incurred by Mr. Duncan commencing November 1992. Mr. Duncan
continued to receive this salary until November 1, 1993 when he entered
into an employment contract with the Company. See "-- Employment Contract
and Change of Control Arrangements" and "-- Compensation Committee Report
on Executive Compensation."
(2) Represents income taxes paid on behalf of the Named Executive Officer
relating to restricted stock awards by the Company. See " -- Compensation
Committee Report on Executive Compensation."
(3) On May 15, 1995, Messrs. Duncan, Andersen, Thompson and Nesbit received
restricted stock awards pursuant to the Company's 1989 Employee Stock
Incentive Plan, as amended (the "Employee Plan"), of 10,000 shares, 10,000
shares, 5,000 shares and 5,000 shares, respectively, and, on July 27, 1995,
Mr. Johns received a restricted stock award of 5,000 shares. The shares of
Common Stock subject to
these restrictive stock awards contain restrictions on transfers which
lapse in annual 20% increments, with accelerated vesting upon a change of
control. In accordance with rules promulgated by the Commission, the dollar
value reflected above was calculated by multiplying the closing market
price of the Common Stock on the OTC Bulletin Board on the date of grant by
the number of restricted shares awarded. The aggregate number and value of
restricted shares held by the Named Executive Officers as of December 31,
1995 were as follows:
<TABLE>
<CAPTION>
VALUE AT
DECEMBER 31, 1995
NAME SHARES ($1.41)
------------------------------------------------- ------- -----------------
<S> <C> <C>
Duncan........................................... 110,000 $ 155,100
Andersen......................................... 10,000 14,100
Johns............................................ 5,000 7,050
Thompson......................................... 5,000 7,050
Nesbit........................................... 5,000 7,050
</TABLE>
5
<PAGE> 8
(4) Certain of the indicated options were granted to replace options previously
granted to the Named Executive Officers on a one-for-one basis at an
exercise price of $1.81, the closing sale price of the Common Stock on the
OTC Bulletin Board on the date of grant. The replacement options granted on
behalf of Messrs. Duncan, Johns, Thompson and Nesbit were for 150,000
shares, 55,000 shares, 50,000 shares and 25,000 shares, respectively. The
replaced options, which were issued between January 1, 1993 and May 1995,
had exercise prices in excess of the market value of the Common Stock as a
result of the residual effects of the improper accounting scheme engaged in
by certain members of the Company's former senior management, as well as
certain other factors which effected the Company's business and financial
performance throughout 1993 and 1994. For a more complete discussion of the
terms and circumstances surrounding the issuance of these replacement
options, see "Report on Repricing of Options."
(5) Includes payments made by the Company on behalf of the Named Executive
Officers with respect to term life insurance for the benefit of each such
individual under a plan whereby the Company pays one annual premium
covering life insurance benefits to all Company employees. Such payments in
fiscal year 1995 were approximately $701, $220, $1,967, $365 and $553 for
each of Messrs. Duncan, Andersen, Johns, Thompson and Nesbit, respectively.
In addition, the Company also paid premiums totalling $3,300 on a separate
term life insurance policy for the benefit of Mr. Duncan. Also includes
contributions made by the Company on behalf of Messrs. Andersen, Johns,
Thompson and Nesbit to the Company's 401(k) plan for the fiscal year ended
December 31, 1995 in the amounts of $553, $503, $696 and $377,
respectively.
(6) Mr. Duncan's equity compensation package under his employment contract
includes a restricted stock award of 100,000 shares granted in 1993. Mr.
Duncan is entitled to vote and receive dividends paid on the restricted
shares. As of the Record Date, the restrictions on 24,167 of the shares had
lapsed and the restrictions on the remaining shares will lapse at a rate of
833.33 shares per month. If Mr. Duncan leaves the employment of the Company
during this period (a total of ten years from the date of grant), the
shares with respect to which the restrictions have not lapsed shall be
returned to the Company and canceled. In accordance with the rules
promulgated by the Commission, the dollar value reflected above ($475,000)
was calculated by multiplying the closing market price of the Common Stock
on the Nasdaq National Market on the date of grant (November 1, 1993) by
the number of restricted shares awarded.
OPTION GRANTS IN LAST FISCAL YEAR
Shown below is information concerning stock option grants to the Named
Executive Officers during the fiscal year ended December 31, 1995.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ------------------------------------------------------------------------------------------------
PERCENT OF
NUMBER OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO EXERCISE OR GRANT DATE
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION PRESENT
NAME GRANTED (#) FISCAL YEAR ($/SHARE) DATE VALUE(1)
- --------------------------------------- ----------- ------------ ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
E. Townes Duncan....................... 60,000(2) 5.9% $1.81 5/15/05 $ 53,400
150,000(3) 14.9% 1.81 5/15/05 133,500
Joseph G. Andersen..................... 40,000(2) 3.9% 1.81 5/15/05 35,600
Paul D. Johns.......................... 20,000(2) 1.9% 2.28 7/27/05 22,000
55,000(3) 5.5% 1.81 5/15/05 48,950
Michael C. Thompson.................... 20,000(2) 1.9% 1.81 5/15/05 17,800
50,000(3) 4.9% 1.81 5/15/05 44,500
David E. Nesbit........................ 20,000(2) 1.9% 1.81 5/15/05 17,800
25,000(3) 2.5% 1.81 5/15/05 22,500
</TABLE>
- ---------------
(1) Based on the Black-Scholes option pricing model adopted for use in valuing
executive stock options. The actual value, if any, a Named Executive
Officer may realize will depend on the excess of the stock price over the
exercise price on the date the option is exercised. The estimated values
under the Black-Scholes model are based on arbitrary assumptions as to
variables such as interest rates, stock price volatility and future
dividend yield. Accordingly, the value estimated by the Black-Scholes model
may not be a realistic measure of the true value of such options.
6
<PAGE> 9
(2) Options granted to Messrs. Duncan, Andersen, Thompson and Nesbit on May 15,
1995 and to Mr. Johns on July 27, 1995 pursuant to the Employee Plan. The
options become exercisable ten years from the date of grant, but allow for
accelerated vesting based on meeting or exceeding performance based goals
relating to the Company's financial results for a given year. Vesting of
these performance based options also will accelerate upon a change of
control.
(3) Options granted May 15, 1995. These options vest in four equal annual
installments beginning on the first anniversary of the date of grant. The
indicated options were granted to replace options previously granted to the
Named Executive Officers on a one-for-one basis at an exercise price of
$1.81, the closing sale price of the Common Stock on the OTC Bulletin Board
on the date of grant. The replaced options, which were issued between
January 1, 1993 and May 1995, had exercise prices in excess of the market
value of the Common Stock as a result of the residual effects of the
improper accounting scheme engaged in by certain former members of the
Company's senior management, as well as certain other factors which
effected the Company's business and financial performance throughout 1993
and 1994. For a more complete discussion of the terms and circumstances
surrounding the issuance of these replacement options, see "Report on
Repricing of Options."
FISCAL YEAR END OPTION VALUES
The following table provides information as to the number of shares covered
by both exercisable and unexercisable stock options for the Named Executive
Officers as of December 31, 1995. Also reported are the values for the
"in-the-money" options, which represent the positive spread between the exercise
price of any such existing stock options and the year-end price of the Common
Stock. No options were exercised by the Named Executive Officers during the
fiscal year ended December 31, 1995. The Company has never awarded any stock
appreciation rights to its executive officers, directors or employees.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS
FISCAL YEAR-END(#) AT FISCAL YEAR-END($)(1)
---------------------------- ----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------------------------------- ----------- -------------- ---------- -------------
<S> <C> <C> <C> <C>
E. Townes Duncan............................... 62,750 173,250 $ 0 $ 0
Joseph G. Andersen............................. 11,500 59,500 150 450
Paul D. Johns.................................. 14,000 62,000 0 0
Michael C. Thompson............................ 12,750 58,250 0 0
David E. Nesbit................................ 7,750 43,250 0 0
</TABLE>
- ---------------
(1) Based on the closing price of the Common Stock on the OTC Bulletin Board on
December 31, 1995 ($1.41), the indicated options are not "in-the-money,"
i.e., the fair market value of the underlying securities at year-end did
not exceed the exercise price of the option, except for an option grant of
15,000 shares to Mr. Andersen.
DIRECTOR COMPENSATION
The Company's directors receive an annual retainer of $6,000 plus a fee of
$250 for each Board of Directors or committee meeting attended and reimbursement
of expenses. Pursuant to the Company's 1993 Outside Directors' Stock Plan (the
"Outside Directors' Plan"), each non-employee director of the Company serving as
a director on December 21, 1993 received an option to purchase 15,000 shares of
Common Stock at $4.50 per share. Each person elected as an outside director
after such date shall receive an initial one-time option grant for the purchase
of 15,000 shares of Common Stock with an exercise price equal to the fair market
value of the Common Stock at the time of such director's election to the Board
of Directors. In addition, each non-employee director shall receive annually on
the date of the annual meeting of stockholders, an additional option for the
purchase of 2,000 shares of Common Stock with an exercise price equal to the
fair market value of the Common Stock on the date of grant. All options granted
under the Outside Directors' Plan shall vest on the first anniversary of the
date of grant and shall remain exercisable for a period of ten years as long as
the director serves on the Board of Directors. In addition, each non-employee
director may elect to receive all or a portion of his or her director fees in
shares of Common Stock under the Outside Directors' Plan. The Board of Directors
may, in the future, adjust the compensation of directors as it deems advisable
and consistent with the best interests of the Company's stockholders and the
financial abilities of the Company.
7
<PAGE> 10
EMPLOYMENT CONTRACT AND CHANGE OF CONTROL ARRANGEMENTS
Effective November 1, 1993, the Company entered into an employment contract
with E. Townes Duncan to serve as Chief Executive Officer of the Company for a
period of one (1) year, with automatic renewal terms unless terminated upon not
less than thirty (30) days prior written notice from either party. Mr. Duncan's
cash compensation pursuant to his employment contract includes a base salary of
$240,000 and a cash bonus not to exceed 50% of his base salary as determined by
the Compensation Committee. The base salary of Mr. Duncan is reviewed annually
by the Compensation Committee. See "-- Compensation Committee Report on
Executive Compensation." Mr. Duncan's employment contract also includes equity
components consisting of a restricted stock award of 100,000 shares of Common
Stock (the "Restricted Stock") and a stock option to purchase 150,000 shares of
Common Stock (the "Stock Option"). With respect to the Restricted Stock award,
24,167 shares of Common Stock are freely transferable and the remaining 75,833
shares contain restrictions on transfer which lapse at a rate of 833.33 shares
per month. The Company also agreed to pay all tax liabilities owed by Mr. Duncan
relating to such shares. With respect to the Stock Option, Mr. Duncan originally
received an option to purchase 150,000 shares of Common Stock at an exercise
price of $5.50 per share. The shares subject to this option vested at a rate of
3,125 shares per month over a period of ten years. In connection with the
Exchange Options (see "-- Report on Repricing of Options" below) approved by the
Compensation Committee in May 1995, Mr. Duncan exchanged his original stock
option for a new stock option to purchase 150,000 shares at an exercise price of
$1.81 per share, the closing sale price of the Common Stock on the OTC Bulletin
Board on the date of grant. The shares subject to Mr. Duncan's new stock option
vest in four equal annual installments beginning on May 15, 1996, the first
anniversary of the date of grant. If Mr. Duncan is terminated by the Company for
any reason other than Cause (as defined in the employment contract), Mr. Duncan
shall receive severance compensation equal to one year's base salary as in
effect at the time of termination. Such severance compensation also shall be due
if Mr. Duncan resigns within 90 days following a Change of Control Event (as
defined in the employment agreement). Furthermore, upon the occurrence of a
Change of Control Event, the restrictions on the Restricted Stock shall be
removed and the Stock Option shall become immediately exercisable in full. Mr.
Duncan also is eligible to receive annual stock incentive grants as determined
by the Compensation Committee. See "-- Compensation Committee Report on
Executive Compensation."
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the last fiscal year, Lonnie J. Stout II, J C. Bowling, Howard H.
Graham and Richard W. Oliver served as members of the Compensation Committee. E.
Townes Duncan, the Company's Chairman of the Board and Chief Executive Officer,
serves as a member of the Compensation Committee of Volunteer Capital
Corporation, of which Mr. Stout is Chairman of the Board and Chief Executive
Officer.
REPORT ON REPRICING OF OPTIONS
The Compensation Committee determined that it was appropriate to take
certain corrective actions to adequately compensate and reward executive
officers and employees for their past efforts and to properly incentivize such
employees in the future in recognition of the fact that the Compensation
Committee's ability to fairly evaluate and compensate the Company's executive
officers and employees in the past has been severely compromised by the improper
accounting scheme engaged in by certain former members of the Company's senior
management. The Company retained a compensation consulting firm in 1993 (the
"Consultant") to evaluate and formalize its executive compensation policies and
procedures and to recommend appropriate types and levels of compensation. In
consultation with the Consultant, the Compensation Committee, during 1993, (i)
replaced certain options which had prices in excess of the market value of the
Common Stock (the "Underwater Options") on a one-for-one basis (the "Replacement
Options"); and (ii) authorized a one time additional grant to certain long-time
employees who did not receive replacement options because their outstanding
options were not Underwater Options (the "Retention Options") equal to 20% of
such employees' prior option grants with an exercise price equal to $5.50, the
average market price for the Common Stock for the 45 trading days prior to
issuance. The Company also issued additional options to certain newly hired
executive officers and employees with an exercise price at the then market value
of the Common Stock. Following these actions, the market value of the Common
Stock continued to decrease as the
8
<PAGE> 11
residual effects of the accounting scheme, as well as certain other factors,
continued to affect the Company's business and financial performance throughout
1993 and 1994.
The Compensation Committee determined in May 1995 that significant changes
were appropriate, necessary and in the best interests of the Company's
stockholders to adequately incentivize and retain certain employees of the
Company who are critical to the long-term success of the Company. Accordingly,
the Compensation Committee approved additional incentive stock awards, including
giving to holders of all options issued after January 1, 1993 the option to
exchange their existing options for new options on a one-for-one basis at the
current market price of the Common Stock on the date of grant (the "Exchange
Options"). The Exchange Options vest in four equal annual installments beginning
on the first anniversary of the date of grant. Employees who elected to receive
Exchange Options, therefore, forfeited the right to acquire shares of Common
Stock already vested pursuant to prior options. The Compensation Committee
believes that structuring the vesting period in this manner will promote the
long-term best interests of the Company and its stockholders by aligning the
interests of the Company's employees with its stockholders to enhance
stockholder value over the long-term.
Lonnie J. Stout II
Richard W. Oliver
J C. Bowling
Howard H. Graham
The following table includes certain information covering the Exchange
Options for all executive officers of the Company and the Replacement Options
granted in 1993. There have been no other option repricings by the Company
during the last ten completed fiscal years.
TEN-YEAR OPTION REPRICINGS
<TABLE>
<CAPTION>
LENGTH OF
MARKET PRICE ORIGINAL
NUMBER OF OF COMMON OPTION
SECURITIES STOCK AT EXERCISE PRICE TERM REMAINING
UNDERLYING TIME OF AT TIME OF NEW AT DATE OF
OPTIONS REPRICING OR REPRICING OR EXERCISE REPRICING OR
REPRICED OR AMENDMENT AMENDMENT PRICE AMENDMENTS
NAME AND POSITION DATE AMENDED(#) ($) ($) ($)(1) (MONTHS)
- --------------------------- -------- ------------ ------------ -------------- ------- --------------
<S> <C> <C> <C> <C> <C> <C>
E. Townes Duncan........... 05/15/95 150,000 $ 1.81 $ 5.50 $1.81 102
Chairman of the Board,
Chief Executive Officer
and President
Paul D. Johns.............. 05/15/95 55,000 1.81 4.50 1.81 47
Vice President of Human
Resources
Michael C. Thompson........ 05/15/95 50,000 1.81 5.88 1.81 38
Vice President
David E. Nesbit............ 05/15/95 25,000 1.81 5.50 1.81 42
Vice President of Sales and 12/01/93 25,000 4.25 12.63 5.50 41
Marketing
</TABLE>
- ---------------
(1) Options were granted with an exercise price equal to the closing sale price
of the Common Stock on the OTC Bulletin Board on the date of grant.
9
<PAGE> 12
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The compensation of the Company's executive officers is reviewed annually
by the Board of Directors and the Compensation Committee, which is composed
entirely of non-employee directors. In addition to reviewing and approving
executive officers' salary and bonus arrangements, the Compensation Committee
administers the Company's stock option and other plans and establishes
guidelines for other employee benefits.
Corrective Actions.
The Compensation Committee recognizes that its efforts to fairly evaluate
and compensate the Company's executive officers in the past were severely
compromised by the improper accounting scheme engaged in by certain former
members of the Company's senior management, and the residual effects thereof
which have continued to effect the Company's business and financial operations
to date. In 1993, the Company retained the Consultant to evaluate and formalize
its executive compensation policies and procedures and to recommend appropriate
types and levels of compensation. Pursuant to the recommendations of the
Consultant, the Compensation Committee negotiated an agreement to secure the
employment of E. Townes Duncan as the Company's Chairman of the Board and Chief
Executive Officer and took certain corrective actions, including the grant of
the Replacement Options and the Retention Options, to compensate and reward
executive officers and employees for their past efforts and properly incentivize
such employees in the future. The Compensation Committee determined in May 1995
that significant additional changes were appropriate, necessary and in the best
interests of the Company's stockholders to adequately incentivize and retain
certain employees of the Company who are critical to the long-term success of
the Company. Accordingly, the Compensation Committee approved additional
incentive stock awards, including the Exchange Options and the grant of
restricted stock awards and performance options to certain of the Company's
executive officers (including the Chief Executive Officer). The report set forth
below is based on, among other things, the recommendations of the Consultant and
the Compensation Committee's continued attempts to provide the proper incentives
to motivate the Company's executive officers.
General Compensation Policies Applicable to Executive Officers.
The Compensation Committee believes that the primary objective of the
Company's compensation of executive officers should be:
- To attract and retain talented executives by providing compensation that
is, overall, competitive with the compensation provided to executives at
companies of comparable size and position in the contract manufacturing
industry, while maintaining compensation levels that are consistent with
the Company's overall financial objectives and operating performances;
- To provide the appropriate incentives for executive officers to work
towards the achievement of the Company's annual sales and operating
targets; and
- To more closely align the interests of its executive officers with those
of its stockholders and the long-term interests of the Company by
providing long-term incentive compensation in the form of stock options
and other equity-based awards.
Executive compensation is designed with both current (salaries and bonuses)
and long-term (equity ownership) components in mind. The Compensation Committee
believes that the Company's executive compensation policies should be reviewed
each year following the time when the financial results of the prior year become
final. The policies are reviewed in light of their consistency with the
Company's financial performance, the success achieved in meeting its sales and
operating performance targets, the achievement of its overall strategic business
plan objectives and its position within the electronic manufacturing services
industry, as well as the compensation policies of similar companies.
10
<PAGE> 13
Base Salary Compensation. The Compensation Committee, in conjunction with
management, sets the base compensation of its executive officers, including the
Chief Executive Officer, annually at a level it believes appropriate considering
(i) the overall strategic direction of the Company, (ii) the Company's position
within the relative segments of its industry, (iii) the overall responsibilities
of each executive officer, and (iv) the overall compensation package, including
long-term equity and annual incentive compensation, of each executive officer.
In addition to corporate performance and specific unit performance, the
Compensation Committee considers subjective qualitative factors to discern a
particular executive's relative value and personal contributions to the success
of the corporate enterprise. The Compensation Committee also considers
compensation packages for similarly situated executives of companies of similar
size or in comparable lines of business, with whom the Company expects to
compete for executive talent. The Company's Chief Executive Officer initially
proposes a compensation package for each of the Company's executive officers,
including the Chief Executive Officer. The Compensation Committee reviews the
Chief Executive Officer's recommendations and determines the appropriate
compensation package for the forthcoming year. Although not recommended or
requested by the Compensation Committee, Mr. Duncan proposed, and the executive
officers of the Company voluntarily took, a pay cut based on each executive
officer's annual base salary during the fiscal year ended December 31, 1994. Mr.
Duncan and Charles D. Tillett, the Company's former President and Chief
Operating Officer, each took a pay cut of ten percent of their annual base
salary, and the remaining executive officers took a pay cut of five percent of
their annual base salary. A determination was made by Mr. Duncan to continue
voluntary pay cuts for himself and certain other executive officers during 1995
as the Company's financial performance continued to fall below expectations. The
Compensation Committee accepted the recommendation of Mr. Duncan and believes
such action indicates the commitment of Mr. Duncan and the other executive
officers to measure their compensation, in part, based on the long-term success
of the Company.
In 1995, as a result of the residual effects of improper accounting scheme,
the unsettled financial condition of the Company and certain other factors which
continued to effect the Company's business, qualitative factors such as
leadership skills, planning initiative, development skills, morale building
skills and crisis management skills were particularly important factors
considered by the Compensation Committee. The Compensation Committee believes
that the management team in 1995 exceeded its expectations with respect to these
qualitative factors by continuing the process begun in 1993 of restoring
confidence among the Company's employees, maintaining its banking and customer
relationships and implementing control and information systems to facilitate
more accurate and timely management decisions in the operation of the Company's
business.
Annual Incentive Compensation. The Company instituted a three year annual
compensation plan for cash bonuses in February 1994 for all employees of the
Company, salaried and non-salaried, including the executive officers, based on
the recommendations of the Consultant. The bonus plan is designed to encourage
and reward employees for decisions and actions that result in performance
achievement for the benefit of the Company's stockholders and customers.
Compensation under the bonus plan is subject to the attainment of a threshold
level of pre-tax earnings as determined by the Compensation Committee.
If the targeted level of earnings is attained, awards to executive officers
under the bonus plan will be based on corporate and division performance.
Performance awards to executive officers under the bonus plan will be based on a
performance index that combines return on working assets (75%) and customer
satisfaction (25%). Return on working assets is calculated by dividing the
Company's net earnings before taxes by working assets. The customer satisfaction
component will be measured according to semi-annual survey responses from
customers. Performance bonuses to executive officers not tied to a division will
be based entirely on financial results of the Company as a whole. Executive
officers assigned to a particular division will have 60% of their performance
bonus tied to the corporate performance index and the remaining 40% tied to his
or her division's performance index. Executive officers also are eligible to
participate in a discretionary incentive pool established by the Compensation
Committee based on recommendations of the Chief Executive Officer.
For each of 1994 and 1995, the Compensation Committee determined that no
awards would be made under the bonus plan because the Company failed to attain
the threshold level of pre-tax earnings; therefore, to date, no cash bonuses
have been paid to executive officers of the Company under the cash bonus plan.
11
<PAGE> 14
Long Term Incentive Compensation. The Compensation Committee believes that
significant stock ownership by management creates a powerful incentive for
executives to build long-term stockholder value. Accordingly, the Compensation
Committee considers equity-based compensation, which is intended to more closely
align an executive's long-term interest with the Company's stockholders, to be
an integral component of executive compensation. As indicated above, the
Compensation Committee determined that it was appropriate during 1993 to issue
the Replacement Options and Retention Options to certain of the Company's
employees, including its executive officers, to reward such employees for their
past efforts and to properly incentivize such employees in the future. In 1994,
the Company granted options to certain newly hired and existing executive
officers in amounts deemed necessary to attract such persons and provide the
proper incentives for such executive officers to promote the long-term interests
of the Company.
The Compensation Committee determined in May 1995 that significant
additional changes were appropriate, necessary and in the best interests of the
Company's stockholders to adequately incentivize and retain certain employees of
the Company who are critical to the long-term success of the Company.
Accordingly, the Compensation Committee approved incentive stock awards,
including the Exchange Options to the Company's executive officers (including
the Chief Executive Officer). See "-- Report on Repricing of Options." In
addition to the Exchange Options, each executive officer received a restricted
stock award of Common Stock which contain restrictions on transfer that lapse in
annual 20% increments and performance options which have a ten year term with
accelerated vesting upon the achievement of specified performance goals based on
pre-tax earnings. The Company also agreed to pay all income tax liabilities
relating to the restricted shares. See " -- Summary Compensation Table" and
" -- Option Grants in Last Fiscal Year."
The Company intends to continue the program of stock option grants in the
future with equity-based awards which are comparable in amount to long-term
incentive award packages for similarly situated executives of companies of
similar size or in comparable lines of business. In determining the size of
option awards for a particular executive officer, the Compensation Committee
considers the amount of options already held by such officers.
Chief Executive Officer Compensation.
E. Townes Duncan was appointed Interim Chairman of the Board and Interim
Chief Executive Officer in November 1992 following the announcement of the
improper accounting scheme and continued in such capacity until April 1993 when
Mr. Duncan was appointed Chairman of the Board and Chief Executive Officer. Mr.
Duncan also assumed the position of President of the Company in July 1995
following the departure of Charles D. Tillett, the Company's former President
and Chief Operating Officer. Effective November 1, 1993, the Company entered
into an employment contract with Mr. Duncan to serve as Chief Executive Officer
of the Company for a period of one (1) year, with automatic one-year renewal
terms unless terminated upon not less than thirty (30) days prior written notice
from either party. Mr. Duncan's cash compensation pursuant to his employment
contract provides for a base salary of $240,000. Mr. Duncan also is eligible to
receive a cash bonus not to exceed 50% of his base salary as determined by the
Compensation Committee. In accordance with his employment contract, Mr. Duncan's
base salary is reviewed annually by the Compensation Committee. Although not
recommended or requested by the Compensation Committee Mr. Duncan voluntarily
took a pay cut of ten percent of his annual base salary in both 1994 and 1995.
In addition, Mr. Duncan has not received a cash bonus to date.
A significant portion of Mr. Duncan's compensation package under his
employment contract consists of equity-based incentive compensation. Since Mr.
Duncan did not have significant ownership in the Common Stock, the Compensation
Committee felt that a substantial portion of Mr. Duncan's compensation should be
in the form of equity-based incentive compensation to more closely align his
interests with the stockholders and the long-term interests of the Company. Mr.
Duncan's equity compensation package includes a Restricted Stock award of
100,000 shares and a stock option to purchase 150,000 shares of Common Stock.
With respect to the Restricted Stock award, 24,167 shares of Common Stock
presently are freely transferrable and the remaining 75,833 shares contain
restrictions on transfer which lapse at a rate of 833.33 shares per month. The
Company also agreed to pay all income tax liabilities owed by Mr. Duncan
relating to such shares. Mr. Duncan's original stock option for 150,000 shares
of Common Stock had an exercise price per share of
12
<PAGE> 15
$5.50 and vested at a rate of 3,125 shares per month. In connection with the
Exchange Options approved in May 1995, Mr. Duncan exchanged his original stock
option for a new stock option to purchase 150,000 shares of Common Stock. The
shares pursuant to Mr. Duncan's new stock option were granted with an exercise
price of $1.81, the closing market price of the Common Stock on the OTC Bulletin
Board on the date of grant, and vest in annual increments of 25% of the shares
subject to the option. See "-- Option Grants in Last Fiscal Year." Mr. Duncan
also is eligible to receive additional equity-based incentive compensation as
determined by the Compensation Committee. During 1995, in addition to the
Exchange Option, Mr. Duncan received a restricted stock award of 10,000 shares
of Common Stock which contain restrictions on transfer that lapse in annual 20%
increments and a performance option for 60,000 shares of Common Stock. The
Company also agreed to pay all tax liabilities relating to the restricted
shares. The performance option has a ten year term with accelerated vesting upon
the achievement of specified performance goals based on pre-tax earnings. See
"-- Summary Compensation Table" and "Option Grants in Last Fiscal Year."
The compensation package of Mr. Duncan is based on recommendations of the
Consultant and a search firm engaged by the Company to attract qualified
candidates to serve as the Company's Chief Executive Officer. The Compensation
Committee believes the compensation package offered to Mr. Duncan is appropriate
in relation to compensation packages for similarly situated officers of publicly
held companies and considering the extraordinary circumstances of the Company.
Federal Income Tax Deductibility Limitations.
The Compensation Committee believes it is appropriate to take into account
the $1,000,000 limit on the deductibility of executive compensation for Federal
income tax purposes enacted as part of the 1993 Omnibus Budget Reconciliation
Act ("OBRA") and to seek to qualify the Company's long-term compensation awards
as performance-based compensation excluded from the $1,000,000 limit. Because
the Company is in no immediate danger of losing any deduction, the Company has
not yet taken action to qualify its stock incentive plans as performance-based
compensation.
Lonnie J. Stout II
Richard W. Oliver
J C. Bowling
Howard H. Graham
13
<PAGE> 16
PERFORMANCE GRAPH
The following graph compares yearly percentage change in the unaudited
total return on the Common Stock against the cumulative total stockholder return
of the Nasdaq Stock Market Total Return Index and the Nasdaq Electronic
Component Stocks Index commencing December 31, 1990 and ending December 31,
1995. The comparison of total return on investment (change in year-end stock
price plus reinvested dividends) for each of the periods assumes that $100 was
invested on December 31, 1990 in the Common Stock or the respective indexes.
[GRAPH]
<TABLE>
<CAPTION>
Nasdaq
The Nasdaq Electronic
Measurement Period Comptronix Stock Market Component
(Fiscal Year Covered) Corporation (US) Stocks
<S> <C> <C> <C>
1990 100.00 100.00 100.00
1991 450.00 160.56 142.40
1992 190.91 186.87 222.48
1993 136.36 214.51 305.53
1994 47.73 209.69 337.49
1995 50.00 296.30 560.01
</TABLE>
14
<PAGE> 17
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's officers and directors, and persons who
beneficially own more than ten percent of a registered class of the Company's
equity securities, to file reports of ownership and changes in ownership with
the Commission. Officers, directors, and greater than ten percent stockholders
are required by federal securities regulations to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely on the Company's review of the copies of such forms and
written representations from certain reporting persons furnished to the Company,
the Company believes that its officers, directors, and greater than ten percent
beneficial owners were in compliance with all applicable filing requirements for
the year ended December 31, 1995.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors of the Company has selected Arthur Andersen LLP to
serve as independent auditors for the current fiscal year. Representatives of
Arthur Andersen LLP are expected to be present at the Annual Meeting and will be
given the opportunity to make a statement if they desire to do so and to respond
to appropriate questions.
PROPOSALS OF STOCKHOLDERS
Stockholders intending to submit proposals for presentation at the next
Annual Meeting of Stockholders and inclusion in the proxy statement and form of
proxy for such meeting should forward such proposals to Joseph G. Andersen,
Secretary, Comptronix Corporation, Three Maryland Farms, Suite 140, Brentwood,
Tennessee 37027. Proposals should be sent to the Company by certified mail,
return receipt requested and must be received by the Company prior to January 1,
1997.
Date: May 1, 1996
15
<PAGE> 18
APPENDIX A
PROXY
COMPTRONIX CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD ON TUESDAY, JUNE 4, 1996.
The undersigned hereby appoints E. Townes Duncan and Joseph G. Andersen, and
each of them, as proxies, with full power of substitution, to vote all shares of
the undersigned as shown below on this proxy at the Annual Meeting of
Stockholders of Comptronix Corporation to be held at The Maryland Farms Athletic
Club, 5101 Maryland Way, Brentwood, Tennessee, on Tuesday, June 4, 1996 at 10:00
a.m., local time, and any adjournment thereof.
(1) PROPOSAL I: ELECTION OF DIRECTORS
/ / FOR all of the nominees (except as indicated to the contrary below):
E. Townes Duncan, Lonnie J. Stout II, Richard W. Oliver, J C. Bowling,
Howard H. Graham
/ / WITHHOLD AUTHORITY (ABSTAIN) to vote for the following nominees
(please print name or names)
---------------------------------------------------------------------------
/ / WITHHOLD AUTHORITY (ABSTAIN) to vote for all five nominees
(2) In their discretion, any other matter which may properly come before said
meeting or any adjournment thereof.
IMPORTANT: PLEASE DATE AND SIGN THIS PROXY ON THE REVERSE SIDE.
Your shares will be voted in accordance with your instructions. If no choice
is specified, shares will be voted FOR the nominees in the election of
directors.
Date: , 1996
-------------------
PLEASE SIGN BELOW, PROVIDE
YOUR SOCIAL SECURITY NUMBER OR
TAX IDENTIFICATION NUMBER AND
RETURN PROMPTLY
------------------------------
------------------------------
------------------------------
SOCIAL SECURITY NUMBER/
TAX IDENTIFICATION NUMBER
Please sign exactly as your
name appears on your share
certificates. If registered in
the names of two or more
persons, each should sign.
Executors, administrators,
trustees, guardians,
attorneys, and corporate
officers should show their
full titles.
- --------------------------------------------------------------------------------
If you have changed your address, please PRINT your new address on this line.
