SCHEDULE 14A INFORMATION
INFORMATION REQUIRED IN PROXY STATEMENT
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[ ] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
SITEK, INCORPORATED
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(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:
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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
1) Amount previously paid:
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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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SITEK, INCORPORATED
1817 West Fourth Street
Tempe, Arizona 85281
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held September 28, 1999
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders of Sitek, Incorporated, a Delaware
corporation (the "Company"), will be held on Tuesday, September 28, 1999 at 9:00
a.m. local time, at the offices of the Company at 1817 West 4th Street, Tempe,
Arizona 85281, for the following purposes:
(1) To elect four directors to serve until the Annual Meeting of
Stockholders to be held in the year 2000 or until their respective successors
are elected;
(2) To consider and act upon a proposal to approve of the Company's 1999
Stock Incentive Plan;
(3) To consider and act upon a proposal to ratify the appointment of
McGladrey & Pullen, L.L.P. as independent auditors of the Company for the fiscal
year ending March 31, 2000; and
(4) To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Stockholders of record at the close of business on August 2, 1999 are
entitled to vote at the meeting and at any adjournment or postponement thereof.
Shares can be voted at the meeting only if the holder is present or represented
by proxy. A list of stockholders entitled to vote at the meeting will be open
for inspection at the Company's corporate headquarters for any purpose germane
to the meeting during ordinary business hours for ten days prior to the meeting.
A copy of the Company's 1999 Annual Report to Stockholders, which includes
certified financial statements, is enclosed. All stockholders are cordially
invited to attend the Annual Meeting in person.
By order of the Board of Directors,
/s/ Dr. Don M. Jackson, Jr.
Dr. Don M. Jackson, Jr.
Chief Executive Officer and President
Tempe, Arizona
September 2, 1999
IMPORTANT: IT IS IMPORTANT THAT YOUR STOCKHOLDINGS BE REPRESENTED AT THIS
MEETING. WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE
AND SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE TO
ASSURE REPRESENTATION OF YOUR SHARES. NO POSTAGE NEED BE AFFIXED IF MAILED IN
THE UNITED STATES.
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SITEK, INCORPORATED
PROXY STATEMENT FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD SEPTEMBER 28, 1999
TABLE OF CONTENTS
SOLICITATION, EXECUTION AND REVOCATION OF PROXIES........................... 1
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF............................. 2
Security Ownership of Certain Beneficial Owners and Management......... 2
PROPOSAL 1: ELECTION OF DIRECTORS........................................... 3
Board Meetings and Committees.......................................... 5
Compensation of Directors.............................................. 5
Certain Legal Proceedings.............................................. 6
EXECUTIVE COMPENSATION...................................................... 6
Report of the Compensation Committee of the Board of Directors......... 6
Compensation Committee Interlocks and Insider Participation............ 8
Certain Transactions................................................... 8
Summary Compensation Table............................................. 9
Option/SAR Grants in Last Fiscal Year.................................. 9
Aggregated Option/SAR Exercises in Last Fiscal Year and FY-End
Option/SAR Values.................................................... 9
Employment Contracts, Termination of Employment, and
Change-in-Control Arrangements ...................................... 9
Performance Graph...................................................... 10
Section 16(a) Beneficial Ownership Reporting Compliance................ 10
PROPOSAL 2: APPROVAL OF THE 1999 STOCK INCENTIVE PLAN....................... 10
Summary of 1999 Plan................................................... 11
Certain Federal Income Tax Consequences................................ 13
Valuation.............................................................. 13
Option Grants.......................................................... 13
Required Vote.......................................................... 13
PROPOSAL 3: APPOINTMENT OF INDEPENDENT AUDITORS............................. 14
OTHER MATTERS............................................................... 15
STOCKHOLDER PROPOSALS....................................................... 15
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SITEK, INCORPORATED
1817 West Fourth Street
Tempe, Arizona 85281
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PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD SEPTEMBER 28, 1999
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SOLICITATION, EXECUTION AND REVOCATION OF PROXIES
Proxies in the accompanying form are solicited on behalf, and at the
direction, of the Board of Directors of Sitek, Incorporated (the "Company") for
use at the Annual Meeting of Stockholders to be held on September 28, 1999 at
9:00 a.m.`or any adjournment thereof (the "Annual Meeting") at the offices of
the Company at 1817 West Fourth Street, Tempe, Arizona 85281. All shares
represented by properly executed proxies, unless such proxies have previously
been revoked, will be voted in accordance with the direction on the proxies. If
no direction is indicated, the shares will be voted in favor of the proposals to
be acted upon at the Annual Meeting. The Board of Directors is not aware of any
other matter which may come before the meeting. If any other matters are
properly presented at the meeting for action, including a question of adjourning
the meeting from time to time, the persons named in the proxies and acting
thereunder will have discretion to vote on such matters in accordance with their
best judgment.
When stock is in the name of more than one person, the proxy is valid if
signed by any of such persons unless the Company receives written notice to the
contrary. If the stockholder is a corporation, the proxy should be signed in the
name of such corporation by an executive or other authorized officer. If signed
as attorney, executor, administrator, trustee, guardian or in any other
representative capacity, the signer's full title should be given and, if not
previously furnished, a certificate or other evidence of appointment should be
furnished.
This Proxy Statement and the form of proxy which is enclosed are being
mailed to the Company's stockholders commencing on or about September 2, 1999.
A stockholder executing and returning a proxy has the power to revoke it at
any time before it is voted. A stockholder who wishes to revoke a proxy can do
so by executing a later-dated proxy relating to the same shares and delivering
it to the Secretary of the Company prior to the vote at the Annual Meeting, by
written notice of revocation received by the Secretary prior to the vote at the
Annual Meeting or by appearing in person at the Annual Meeting, filing a written
notice of revocation and voting in person the shares to which the proxy relates.
In addition to the use of the mails, proxies may be solicited by personal
conversations or by telephone, telex, facsimile or telegram by the directors,
officers and regular employees of the Company. Such persons will receive no
additional compensation for such services. Arrangements will also be made with
certain brokerage firms and certain other custodians, nominees and fiduciaries
for the forwarding of solicitation materials to the beneficial owners of Common
Stock held of record by such persons, and such brokers, custodians, nominees and
fiduciaries will be reimbursed for their reasonable out-of-pocket expenses
incurred in connection therewith. All expenses incurred in connection with this
solicitation will be borne by the Company.
The mailing address of the principal corporate office of the Company is
1817 West Fourth Street, Tempe, Arizona 85281.
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VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
Only stockholders of record at the close of business on August 2, 1999 (the
"Record Date") will be entitled to vote at the Annual Meeting. On the Record
Date, there were issued and outstanding 12,307,813 shares of Common Stock. Each
holder of Common Stock is entitled to one vote, exercisable in person or by
proxy, for each share of the Company's Common Stock held of record on the Record
Date. The presence of a majority of the shares of Common Stock entitled to vote,
in person or by proxy, is required to constitute a quorum for the conduct of
business at the Annual Meeting. Abstentions and broker non- votes are each
included in the determination of the number of shares present for quorum
purposes. The Inspector of Election appointed by the Chairman of the Board of
Directors shall determine the shares represented at the meeting and the validity
of proxies and ballots and shall count all proxies and ballots. The four
nominees for director receiving the highest number of affirmative votes (whether
or not a majority) cast by the shares represented at the Annual Meeting and
entitled to vote thereon, a quorum being present, shall be elected as directors.
The affirmative vote of a majority of the shares present in person or by proxy
and entitled to vote is required with respect to the approval of the other
proposals set forth herein.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table and notes thereto sets forth information regarding the
beneficial ownership of the Company's common stock at August 2, 1999 with
respect to (i) each person known to the Company to own beneficially more than
five percent of the outstanding shares of the Company's common stock, (ii) each
director of the Company and each director nominee, (iii) each of the named
executive officers and (iv) all directors and executive officers of the Company
as a group.
Shares Beneficially
Owned (1)(2)
----------------------
Identity of Stockholder or Group Number Percent
- -------------------------------- ------ -------
Santina Anness (3) 900,000 7.32
Vince E. Birdwell (4) 952,054 7.74
Mark A. DiSalvo (5) 900,000 7.32
Sass DiSalvo (6) 895,490 7.28
Julian W. Gates 1,186,200 9.64
Dr. Don M. Jackson, Jr. 1,186,200 9.64
Kevin B. Jackson (7) 948,960 7.71
Paul D. Jackson (8) 1,186,200 9.64
Maurice L. McGill (9) 49,000 *
L. Richard Myers (10) 238,792 1.94
Parag S. Modi 1,186,200 9.64
Dr. Daniel L. Shunk (11) 49,000 *
Mark G. Simon 1,186,200 9.64
All directors and executive officers
as a group (9 persons) (12) 6,030,282 49.0
- ----------
* Less than one percent
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission ("SEC") and generally includes voting or
investment power with respect to securities. In accordance with SEC rules,
shares which may be acquired upon exercise of stock options which are
currently exercisable or which become exercisable within 60 days of the
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date of the table are deemed beneficially owned by the optionee. Except as
indicated by footnote, and subject to community property laws where
applicable, the persons or entities named in the table above have sole
voting and investment power with respect to all shares of Common Stock
shown as beneficially owned by them.
(2) Unless otherwise noted, the mailing address for each of the beneficial
owners listed below is c/o SITEK, Incorporated, 1817 West Fourth Street,
Tempe, Arizona 85281. All information was obtained from the Company's stock
registry as of August 2, 1999.
(3) Ms. Anness, whose mailing address is 9554 Via Salerno, Burbank, CA 91504,
is the registered owner of 900,000 shares of the Company's common stock and
the mother-in-law of Mark A. DiSalvo, a former director and officer of a
predecessor company, Dentmart Group, Inc.
(4) Mr. Birdwell is an employee of the Company and acts as Secretary of CMP
Solutions, Inc.
(5) Mr. DiSalvo was a director and officer of a predecessor company to SITEK,
Incorporated. His mailing address is 192 Searidge Court, Shell Beach, CA
93449.
(6) Ms. DiSalvo, who mailing address is 248 N. California Street, Burbank, CA
91505, is the registered owner of 895,490 shares of the Company's common
stock and the mother of Mark A. DiSalvo, a former director and officer of a
predecessor company, Dentmart Group, Inc.
(7) Mr. Kevin B. Jackson was hired on June 14, 1999 and is now the President of
VSM Corporation which was recently acquired by the Company. He is also the
son of Dr. Don M. Jackson, President, Chief Executive Officer and a
director of the Company.
(8) Mr. Paul D. Jackson is the Secretary of SITEK and son of Dr. Don M.
Jackson, President, Chief Executive Officer and a director of the Company
(9) Includes 25,000 shares Mr. McGill has a right to acquire upon exercise of
stock options.
(10) Includes 25,000 shares Mr. Meyers has a right to acquire upon exercise of
stock options.
(11) Includes 25,000 shares Dr. Shunk has a right to acquire upon exercise of
stock options.
(12) Includes 75,000 shares directors have a right to acquire upon exercise of
stock options.
PROPOSAL 1: ELECTION OF DIRECTORS
All four directors are to be elected at the Annual Meeting to serve as
directors until the Annual Meeting of Stockholders to be held in the year 2000
and until their respective successors are elected. UNLESS OTHERWISE INSTRUCTED,
THE PROXY HOLDERS WILL VOTE THE PROXIES RECEIVED BY THEM FOR THE COMPANY'S
NOMINEES: DR. DON M. JACKSON, JR., MAURICE L. MCGILL, L. RICHARD MYERS AND
DANIEL L. SHUNK. Messrs. Jackson, McGill, Myers and Shunk are currently
directors of the Company. The four nominees for director receiving the highest
number of affirmative votes (whether or not a majority) cast by the shares
represented at the Annual Meeting and entitled to vote thereon, a quorum being
present, shall be elected as directors. Only affirmative votes are relevant in
the election of directors.
Any stockholder entitled to vote for the election of directors at a meeting
may nominate persons for election as directors only if written notice of such
stockholder's intent to make such nomination is given, either by personal
delivery at 1817 West Fourth Street, Tempe, Arizona or by United States mail,
postage prepaid to Secretary, Sitek, Incorporated, 1817 West Fourth Street,
Tempe, Arizona 85281, not later than: (i) with respect to the election to be
held at an annual meeting of stockholders, 20 days in advance of such meeting;
and (ii) with respect to any election to be held at a special meeting of
stockholders for the election of directors, the close of business on the
fifteenth (15th) day following the date on which notice of such meeting is first
given to stockholders. Each such notice must set forth: (a) the name and address
of the stockholder who intends to make the nomination and of the person or
persons to be nominated; (b) a representation that such stockholder is a holder
of record of stock of the corporation entitled to vote at such meeting and
intends to appear in person or by proxy at the meeting to nominate the person or
persons specified in the notice; (c) a description of all arrangements or
understandings between such stockholder and each nominee and any other person or
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persons (naming such person or persons) pursuant to which the nomination or
nominations are to be made by such stockholder; (d) such other information
regarding each nominee proposed by such stockholder as would have been required
to be included in a proxy statement filed pursuant to the proxy rules of the SEC
if such nominee had been nominated, or intended to be nominated, by the Board of
Directors; and (e) the consent of each nominee to serve as a director of the
corporation if elected. The chairman of a stockholder meeting may refuse to
acknowledge the nomination of any person not made in compliance with the
foregoing procedure.
Pursuant to the Company's Certificate of Incorporation, the Board of
Directors is comprised of four directors, each of whom serve one year terms. The
Board of Directors may increase the number of directors to a maximum of nine.
Directors are elected by a plurality of the votes present in person or
represented by proxy and entitled to vote at the Annual Meeting. Stockholders do
not have the right to cumulate their votes in the election of directors. If any
nominee of the Company is unable or declines to serve as a director at the time
of the Annual Meeting, the proxies will be voted for any nominee who shall be
designated by the present Board of Directors to fill the vacancy. It is not
expected that any nominee will be unable or will decline to serve as a director.
The names of the nominees for director and certain information about them,
are set forth below. The term of each director will expire at the Annual Meeting
NOMINEES FOR DIRECTORS WHOSE TERMS WILL EXPIRE AT THE ANNUAL MEETING HELD
IN THE YEAR 2000:
DR. DON M JACKSON, JR. (1), 65 years old Director since 1998
DR. DON M. JACKSON, JR. is one of the founders of CMP Solutions, Inc. and
has served as Chairman of the Board, President, and Chief Executive Officer
since the inception of SITEK, Incorporated operations on July 14, 1998. Dr.
Jackson joined the company after an extensive career in various executive
positions in technology companies such as ASM America, Inc., Superwave
Technology, Inc., Microelectronic Packaging, Inc., Integrated Process Equipment
Corporation, Westech Systems, Inc., Global Semiconductor Technologies, L.L.C.,
and Motorola. Dr. Jackson holds a Ph.D. from Arizona State University in
Electrical Engineering. Dr. Jackson presently also is a director of Flexpoint
Sensor Systems, Inc. in Midvale, Utah and M&I Thunderbird Bank in Phoenix,
Arizona.
MAURICE L. MCGILL (2)(3), 63 years old Director since 1998
MAURICE L. MCGILL became a Director of SITEK, Incorporated on August 24,
1998. Mr. McGill is the Chairman of the Audit Committee. He presently serves as
a Director of Bluebonnet Savings Bank and Premium Standard Farms, Inc. Mr.
McGill held the positions of Executive V.P., CFO, and Director of IBP, Inc. in
Dakota City, Nebraska from which he retired in 1988. Mr. McGill previously
served as a Partner and National Director of Services for the meat industry for
Touche Ross & Co. in Phoenix, Arizona. He holds an MS in business administration
from the University of Missouri.
L. RICHARD MYERS (2)(3), 67 years old Director since 1998
L. RICHARD MYERS has been a Director of SITEK, Incorporated since August
24, 1998 and serves as the Chairman of the Compensation Committee. He is a
retired Rear Admiral of the U.S. Navy and formerly was the Commanding Officer of
the USS John F. Kennedy. Mr. Myers served as Team Leader on President Reagan's
Private Sector Study formed to reduce waste in government spending. He holds a
MS in International Affairs from American University and a BA in Business
Administration and Economics from Fresno State College.
DR. DANIEL L. SHUNK (1)(2)(3), 51 years old Director since 1998
DR. DANIEL L. SHUNK became a Director of SITEK, Incorporated on August 24,
1998. Dr. Shunk is an Associate Professor of Engineering at Arizona State
University and formerly functioned as its CIM Systems Research Center Director.
He previously has held various executive and management positions in GCA
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Corporation, International Harvester, and Rockwell. Dr. Shunk has received
several awards including the SME International Manufacturing Education Award in
1996 and Industrial Engineering Faculty of the Year Award in 1991. He received
his Ph.D. in Industrial Engineering from Purdue University.
(1) Member of the Executive Committee with Dr. Jackson as chair.
(2) Member of the Audit Committee with Mr. McGill as chair.
(3) Member of the Compensation Committee with Mr. Myers as chair.
THE BOARD RECOMMENDS A VOTE IN FAVOR OF EACH NAMED NOMINEE
BOARD MEETINGS AND COMMITTEES
The Board of Directors held a total of seven meetings during the fiscal
year ended March 31, 1999. No director attended fewer than 75 percent of the
aggregate of all meetings of the Board of Directors and any committee on which
such director served during the period of such service.
The Board presently has an Executive Committee, an Audit Committee and a
Compensation Committee. The Executive Committee, which acts on Board matters
that arise between meetings of the full Board of Directors, consists of Dr.
Jackson and Dr. Shunk and did not meet during the fiscal year ending March 31,
1999.
The Audit Committee consists of Messrs. McGill, Myers and Shunk and met
once during the fiscal year ending March 31, 1999. The Audit Committee meets
independently with representatives of the Company's independent auditors and
with representatives of senior management. The Committee reviews the general
scope of the Company's annual audit, the fee charged by the independent auditors
and other matters relating to internal control systems. In addition, the Audit
Committee is responsible for reviewing and monitoring the performance of
non-audit services by the Company's auditors. The Committee is also responsible
for recommending the engagement or discharge of the Company's independent
auditors.
The Compensation Committee, which consists of Messrs. McGill, Myers &
Shunk, met once during the fiscal year ending March 31, 1999. The Compensation
Committee reviews salaries and benefit programs designed for senior management,
officers and directors and administers certain stock option grants with a view
to ensure that the Company is attracting and retaining highly qualified managers
through competitive salary and benefit programs and encouraging extraordinary
effort through incentive rewards.
COMPENSATION OF DIRECTORS
The Company pays non-employee directors an annual retainer of $24,000,
payable in cash or by the issuance of the Company's common stock at the fair
market price on the date of issuance. The Company also issued one-time options
to acquire 100,000 shares at $1 per share to each non-employee director on
October 28, 1998. Such options vest immediately as to 25 percent of the options
with an additional 25 percent of the total vesting on every anniversary of the
grant until all options are vested. These options have been granted with
ten-year terms.
The Company did not issue any options to the Company's only
employee-director, Dr. Jackson, during the fiscal year ending March 31, 1999.
Dr. Jackson does not receive any additional compensation for serving on the
Board of Directors.
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The following table summarizes options granted to non-employee directors
during the fiscal year ended March 31, 1999:
Number of Option
Name Date of Option Shares Price
- ---- -------------- ------ -----
Maurice L. McGill October 28, 1998 100,000 $1 per share
L. Richard Myers October 28, 1998 100,000 $1 per share
Dr. Daniel L. Shunk October 28, 1998 100,000 $1 per share
CERTAIN LEGAL PROCEEDINGS
SITEK was named as a defendant, along with Global Semiconductor
Technologies, LLC, Global Semiconductor Technologies, Inc., Dr. Don M. Jackson
and Paul D. Jackson, in a lawsuit that was filed on April 1, 1999. The lawsuit
involves two separate claims by two plaintiffs; EDMOND L. LONERGAN AND ROBERT F.
RUSSO, JR. V. SITEK, INCORPORATED, ET AL., Superior Court for the State of
Arizona, County of Maricopa, Case No. CV 99-05785. The first plaintiff, Edmond
Lonergan, alleges that he was not paid for consulting services by Global
Semiconductor Technologies, Inc., a company controlled by certain shareholders
of SITEK. Mr. Lonergan also claims that Global Semiconductor Technologies, Inc.
and/or the other defendants misappropriated trade secrets in conducting the
reverse merger of Dentmart into SITEK. The second plaintiff, Robert Russo, Jr.,
was a former employee of Global Semiconductor Technologies, Inc. Mr. Russo
claims that he was wrongfully terminated. SITEK filed its answer denying these
allegations and intends to defend itself vigorously. Mr. Lonergan and Mr. Russo
have demanded the value of 1,000,000 shares of SITEK's capital stock and other
damages to be proven at trial in their complaint.
EXECUTIVE COMPENSATION
THE FOLLOWING REPORT OF THE COMPENSATION COMMITTEE OF THE COMPANY'S BOARD
OF DIRECTORS (THE "COMMITTEE") AND THE PERFORMANCE GRAPH INCLUDED ELSEWHERE IN
THIS PROXY STATEMENT SHALL NOT BE DEEMED SOLICITING MATERIAL OR OTHERWISE DEEMED
FILED AND SHALL NOT BE DEEMED TO BE INCORPORATED BY REFERENCE BY ANY GENERAL
STATEMENT INCORPORATING BY REFERENCE THIS PROXY STATEMENT INTO ANY OTHER FILING
UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES EXCHANGE ACT OF 1934, EXCEPT
TO THE EXTENT THE COMPANY SPECIFICALLY INCORPORATES THIS REPORT OR THE
PERFORMANCE GRAPH BY REFERENCE THEREIN.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The Committee recommends the compensation of the Chief Executive Officer to
the Board and reviews and approves the design, administration and effectiveness
of compensation programs for other key executive officers, including salary,
cash bonus levels and other perquisites including option grants.
COMPENSATION PHILOSOPHY
The objectives of the Company's executive compensation policies are to
attract, retain and reward executive officers who contribute to the Company's
success, to align the financial interests of executive officers with the
performance of the Company, to strengthen the relationship between executive pay
and shareholder value, to motivate executive officers to achieve the Company's
business objectives and to reward individual performance. During the fiscal year
ending March 31, 1999, the Company used base salary and, to a lesser extent,
executive officer cash bonuses to achieve these objectives. In carrying out
these objectives, the Committee considers the following:
(1) THE LEVEL OF COMPENSATION PAID TO EXECUTIVE OFFICERS IN POSITIONS OF
COMPANIES SIMILARLY SITUATED IN SIZE AND PRODUCTS. To ensure that pay
is competitive, the Committee, from time to time, compares the
Company's executive compensation packages with those offered by other
companies in the same or similar industries or with other similar
attributes. The Company typically surveys publicly available
information regarding companies listed on the OTC Bulletin Board which
are comparable in size, products or industry with the Company.
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(2) THE INDIVIDUAL PERFORMANCE OF EACH EXECUTIVE OFFICER. Individual
performance includes any specific accomplishments of such executive
officer, demonstration of job knowledge and skills and teamwork.
(3) CORPORATE PERFORMANCE. Corporate performance is evaluated both
subjectively and objectively. Subjectively, the Compensation Committee
discusses and makes its own determination of how the Company performed
relative to the opportunities and difficulties encountered during the
year and relative to the performance of competitors and business
conditions. Objectively, corporate performance is measured by
predetermined operating and financial goals.
(4) THE RESPONSIBILITY AND AUTHORITY OF EACH POSITION RELATIVE TO THE
OTHER POSITIONS WITHIN THE COMPANY.
The Committee does not quantitatively weigh these factors but considers all
factors as a whole, using its discretion, best judgment and the experiences of
its members, in establishing executive compensation. The application given each
of these factors in establishing the components of executive compensation are as
follows:
BASE SALARY. In establishing base salaries, the Committee tends to give
greater weight to factors 1, 2 and 4 above. The Company seeks to pay salaries to
executive officers that are commensurate with their qualifications, duties and
responsibilities and that are competitive in the market. In conducting annual
salary reviews, the Committee considers each individual executive officer's
achievements during the prior fiscal year in meeting the Company's financial and
business objectives, as well as the executive officer's performance of
individual responsibilities and the Company's financial position and overall
performance. The Committee considers the low, midpoint and upper ranges of base
salaries publicly disclosed by companies that Sitek, Incorporated believes are
comparable to it and generally targets base salary to the mid-point of the
ranges.
PERFORMANCE BONUSES. In establishing performance bonuses, the Committee
tends to give greater weight to factors 2, 3 and 4 above and further believes
that such performance bonuses are a key link between executive pay and
stockholder value. During the fiscal year ending March 31, 1999, the Company
awarded one bonus of $3,404 to Julian Gates, President of Advanced Technology
Services, Inc. The measures chosen by the Committee to evaluate the Company's
performance may vary from year to year depending on the particular facts and
circumstances at the time.
OPTION GRANTS. In establishing option grants or recommendations to the
entire Board, the Committee tends to give greater weight to factors 2 and 3
above. The Committee believes that equity ownership by executive officers
provides incentives to build stockholder value and aligns the interests of
officers with the stockholders. The Committee typically recommends or awards a
grant upon hiring executive officers, subject to a three-year vesting schedule.
Options are granted at the current fair market price for the Company's Common
Stock and, consequently, have value only if the price of the Common Stock
increases over the exercise price for the period during which the option is
exercisable. The size of the initial grant is usually determined with reference
to the seniority of the officer, the contribution the officer is expected to
make to the Company and comparable equity compensation offered by others in the
industry. As of August 27, 1999, the Company had granted stock options in the
aggregate of 150,000 shares of Common Stock vesting over three years to one
executive officer, Gloria Zemla, in connection with her April 5, 1999 employment
agreement as Chief Financial Officer. The Committee believes that such option
grants provide incentives for executive officers to remain with the Company.
CHIEF EXECUTIVE OFFICER COMPENSATION
The Committee reviews the performance of the Chief Executive Officer at
least annually. When the Committee entered into an employment agreement with Dr.
Don M. Jackson, Jr. on June 7, 1999, the Compensation Committee reviewed data
from a survey of salaries for companies comparable in size, products and
industry and considered the Company's earnings and financial position. Based on
this criteria, the Compensation Committee set Dr. Jackson's salary at $225,000,
with a $650 per month auto allowance (net of taxes) and an opportunity to
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participate in future executive bonus plans. Prior to the June 7, 1999
employment agreement, Dr. Jackson was employed on an at-will basis and earned
$89,100 in salary for the eight months he was acting as Chief Executive Officer
of the Company during the fiscal year ending March 31, 1999.
Compensation Committee Members during fiscal year ending March 31, 1999:
Maurice L. McGill L. Richard Myers Daniel L. Shunk
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
All of the members of the Compensation Committee were non-employee
directors of the Company.
CERTAIN TRANSACTIONS
For a period of six months during the fiscal year ending March 31, 1999 the
Company leased several pieces of semiconductor equipment from Mark A. DiSalvo, a
beneficial owner of more than five percent of the Company's outstanding stock
and a former officer and director of the Company's predecessor company, Dentmart
Group, Inc. The total cost for the six month lease was $42,000. At the end of
the lease in February 1999, the Company purchased the equipment from Mr. DiSalvo
for $340,000.
The Company has a line of credit with TLD Funding Group expiring February
4, 2001, with maximum borrowings of $207,181. Interest is due monthly on the
unpaid balance at an interest rate of 1.5 percent. The collateral for this line
of credit consists of the personal guarantees by Dr. Don M. Jackson, Jr., a
director, the President and Chief Executive Officer of the Company, and Mark G.
Simon, the President of CMP Solutions, Inc., a wholly owned subsidiary. Two
other companies, Global Semiconductor Technologies, Inc. and Advanced Control
Technologies, Inc. are also guarantors on this line of credit. Dr. Don M.
Jackson, Jr. is a shareholder, the President and the sole director of Global
Semiconductor Technologies, Inc. and the Chairman of the Board of Directors and
Treasurer of Advanced Control Technologies, Inc.; Paul D. Jackson, Secretary of
the Company, is also the Executive Vice President, Secretary and a shareholder
of Global Semiconductor Technologies, Inc., and the Executive Vice President,
Secretary and director of Advanced Control Technologies, Inc. In addition, Parag
S. Modi, a beneficial owner of more than five percent of the Company's
outstanding stock, is also the President and a director of Advanced Control
Technologies, Inc. Outstanding borrowings under this line of credit with TLD
Funding Group were $207,181 at March 31, 1999.
During the period ending March 31, 1999 Global Semiconductor Technologies,
Inc. made advances to SITEK for administrative services and rental payment on
the shared facilities. The advances totaled $227,478 at March 31, 1999. During
the same period, SITEK made certain advances to Global Semiconductor
Technologies, Inc. in the aggregate amount of $45,161.
During the fiscal year ending March 31, 1999 Mr. Julian Gates, President of
Advanced Technology Services, Inc., a wholly owned subsidiary of the Company,
paid certain expenses on behalf of the Company totaling $160,940. The advances
are short term and non-interest bearing and will be repaid by the Company within
12 months.
As of March 31, 1999 the Company owed Mark A. DiSalvo, a beneficial owner
of more than five percent of the Company's outstanding common stock, $125,000
for services related to the July 14, 1998 Stock Purchase and Exchange Agreement
between CMP Solutions, Inc. and SITEK, Incorporated. In addition, the Company
paid Mr. DiSalvo $19,200 for consulting services performed during the fiscal
year ending March 31, 1999.
Officers, directors and/or five percent beneficial owners Vince E.
Birdwell, Julian W. Gates, Dr. Don M. Jackson, Jr., Paul D. Jackson, L. Richard
Myers, Parag S. Modi, and Mark G. Simon obtained their positions and/or holdings
of the Company in connection with the July 14, 1998 Stock Purchase and Exchange
Agreement between CMP Solutions and SITEK, Incorporated, then a wholly owned
subsidiary of the Dentmart Group, Inc. whose sole director, officer and
shareholder at the time was Mark A. DiSalvo. In accordance with the terms of the
exchange agreement, the Dentmart Group, Inc. entered into a reverse merger with
its wholly owned subsidiary, SITEK, Incorporated from which SITEK, Incorporated
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was the surviving company. The shareholders of CMP then exchanged their shares
of CMP Solutions for the number of shares of SITEK, Incorporated which are
listed in the Security Ownership of Certain Beneficial Owners and Management
table, except for outside director Myers whose shareholdings also reflect
additional stock option grants and stock paid for services provided as a
director.
SUMMARY COMPENSATION TABLE
The following table sets forth, with respect to the fiscal year ended March
31, 1999, compensation awarded to, earned by or paid to the Company's Chief
Executive Officer and the four other most highly compensated executive officers
who earned over $100,000 in total compensation who were serving as executive
officers at March 31, 1999. No compensation information exists for the fiscal
years ending March 31, 1998 or 1997 as the Company began operations in July
1998.
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
---------------------------------------- ------------
OTHER SECURITIES
ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION OPTIONS/SARS COMPENSATION
POSITION YEAR ($)(1) ($) ($) (#) ($)
- -------- ---- ------ --- ------------ ------------ ------------
Don M. Jackson, Jr. 1999 89,100 0 0 0 0
Director,
President and
Chief Executive
Officer
- ----------
(1) Salary listed reflects the partial year salary earned by Dr. Jackson since
August 1, 1998. Dr. Jackson's annual salary for the fiscal year ending
March 31, 2000 is $225,000.
OPTION/SAR GRANTS IN LAST FISCAL YEAR(1)
No stock options were granted during the last fiscal year to the executive
officers named in the Summary Compensation Table. Consequently, no Option/SAR
Grant table is being provided.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES
Because none of the executive officers named in the Summary Compensation
Table had been granted any options, no options were exercised during the last
fiscal year and no Aggregate Option/SAR Exercises or FY-End Option/SAR Values
table is being provided.
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT, AND
CHANGE-IN-CONTROL ARRANGEMENTS
The Company has entered into employment agreements with each of Dr. Jackson
(for Chief Executive Officer, effective June 7, 1999), Gloria Zemla (for Chief
Financial Officer, effective April 5, 1999) and Kevin B. Jackson (for Vice
President and Chief Legal and Administrative Officer, effective June 14, 1999).
The Employment Agreements provide that salaries shall be determined annually
based on the Company's standard payroll policies. Bonuses shall be determined
annually by the Board of Directors. The Company may terminate each employee's
employment with cause, in which case the Company shall be obligated to pay such
employee's salary through the date of termination. If the Company terminates Dr.
Jackson's or Kevin B. Jackson's employment without cause, Dr. Jackson and Kevin
B. Jackson are entitled to their salaries for the remaining term of their
contract, an additional three years salary and full vesting of all non-vested
options (which shall have "piggyback" registration rights for 10 years). In
addition, Dr. Jackson and Kevin Jackson will receive medical insurance and other
employee benefits for a period of three years. Upon termination of Gloria
Zemla's employment without cause, Ms. Zemla will receive her salary for the
longer of an additional 90 days or the remaining term of the employment
contract. Ms. Zemla also receives options for the purchase of 150,000 shares of
the Company's common stock. Such options vest in three parts on the first,
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second and third anniversary of her employment agreement. As of June 30, 1999
the Company had not entered into any other employment contracts with its
executive officers.
Under the employment agreements for Dr. Jackson and Kevin B. Jackson, upon
the occurrence of a merger in which the Company is not the surviving entity, an
acquisition or take over by another entity, 100 percent of all unvested options
will vest and the employment contract will automatically renew for five years.
PERFORMANCE GRAPH
Set forth below is a graph comparing the cumulative total shareholder
return on the Company's Common Stock to the cumulative total return of (i) the
Standard & Poors 600 Smallcap Index and (ii) the Hambrecht & Quist Semiconductor
Index from August 14, 1998, the first available date a trade was conducted after
the Company commenced operations on June 23, 1998. Therefore, the graph only
shows the performance for the partial year between August 1, 1998 and March 31,
1999. The graph is generated by assuming that $100 was invested on August 14,
1998 in each of the Company's Common Stock, the Standard & Poors 600 Smallcap
Index and the Hambrecht & Quist Semiconductor Index, and that all dividends were
reinvested.
August 14, 1998 March 31, 1999
--------------- --------------
Sitek, Incorporated $100 $110
Hambrecht & Quist Semiconductor Index $100 $160
Standard & Poors 600 Smallcap Index $100 $ 95
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Each of the directors, executive officers and 10% beneficial owners made
voluntary Form 3 filings to the Securities and Exchange Commission on July 29,
1999. In making these disclosures, SITEK has relied solely on written
representations of its directors and executive officers and copies of the
reports that they have filed with the Commission.
PROPOSAL 2: APPROVAL OF THE 1999 STOCK INCENTIVE PLAN
THE SUMMARY OF THE MATERIAL FEATURES OF THE 1999 STOCK INCENTIVE PLAN (THE
"1999 PLAN") IN THIS PROXY STATEMENT DOES NOT PURPORT TO BE COMPLETE AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE 1999 PLAN. A COPY OF THE 1999 PLAN
IS AVAILABLE UPON REQUEST TO THE SECRETARY OF THE COMPANY.
Stock options play a key role in the Company's ability to recruit, reward
and retain executives and key employees. The Company believes that equity-based
incentive programs help insure a tight link between the interests of its
stockholders and employees and enhance the Company's ability to continue
recruiting and retaining top talent. The Board believes that stockholders should
adopt Proposal 2 to help the Company continue to meet these objectives.
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SUMMARY OF 1999 PLAN
The 1999 Plan was originally adopted by the Board of Directors on January
19, 1999. A total of 1,500,000 shares of Common Stock was reserved for issuance
under the 1999 Plan at that time. The Board approved an amendment to the 1999
Plan on August 16, 1999 that increased, by 1,000,000 shares resulting in
2,500,000 shares of Common Stock reserved for issuance.
PURPOSES. The purposes of the 1999 Plan are to attract and retain the best
available employees and directors of the Company or any parent or subsidiary or
affiliate of the Company which now exist or hereafter is organized or acquired
by or acquires the Company, as well as appropriate third parties who can provide
valuable services to the Company, to provide additional incentive to such
persons and to promote the success of the business of the Company.
The 1999 Plan provides for the grant of options which qualify as "incentive
stock options" (sometimes referred to herein as "ISOs") under Section 422 of the
Internal Revenue Code (the "Code") and nonstatutory stock options which do not
specifically qualify for favorable income tax treatment under the Code
(sometimes referred to herein as "NSOs"). The 1999 Plan is administered by the
Board of Directors or by a committee of directors appointed by the Board and
constituted so as to permit the Plans to comply with the provisions of Rule
16b-3 ("Rule 16b-3") under the 1934 Act. The administering body is referred to
herein as the "Committee."
SHARE RESERVE. The aggregate number of shares which may be issued pursuant
to the exercise of options granted under the 1999 Plan is 2,500,000 shares of
the Company's Common Stock, subject to adjustments in certain circumstances,
including reorganizations, recapitalizations, stock splits, reverse stock
splits, stock dividends and the like. As of August 2, 1999, a total of 842,000
shares were subject to outstanding options under the 1999 Plan, and no shares
had been issued upon exercise of options under the 1999 Plan. Of the 842,000
shares, 150,000 shares were issued in an option grant to Gloria Zemla, the
Company's Chief Financial Officer in connection with her April 5, 1999
employment agreement. The remaining 692,000 shares were granted in the form of
options for certain employees by the Board of Directors at the fair market price
on July 29, 1999. None of these grants to employees have been formalized pending
the results of an appraisal of the Company's fair market value to be
commissioned by the Company. If any outstanding option grant under the 1999 Plan
for any reason expires or is terminated, the shares of Common Stock allocable to
the unexercised portion of the option grant shall again be available for options
under the 1999 Plan as if no options had been granted with respect to those
shares.
ELIGIBILITY. Any employee of the Company or any of its subsidiaries is
eligible to receive options under the 1999 Plan. Nonemployee directors are
eligible to receive only NSOs under the 1999 Plan, while employee directors are
eligible for both ISOs and NSOs. As of August 2, 1999, approximately 39
employees (including 7 executive officers) and three non-employee directors were
eligible to participate in the 1999 Plan.
In addition, any other individual whose participation the Committee
determines is in the best interests of the Company is eligible to receive only
NSOs under the 1999 Plan. The Committee has complete discretion to determine
which eligible individuals are to receive option grants. In general, the only
consideration received by the Company for the grant of an award will be past
services or the expectation of future services, or both. The 1999 Plan does not
confer on any optionee any right with respect to continued employment or other
services to the Company and will not interfere in any manner with the right of
the Company to terminate an optionee's employment or other services.
LIMITATIONS ON AWARDS. No grants are required to be made during any year.
In any calendar year, no individual may receive grants of options covering more
than 150,000 shares. No ISO may be exercised more than ten years from the date
of grant (five years in the case of a grant to an optionee owning more than 10%
or more of the total combined voting power of all classes of stock to the
Company or any ISO Group member), three months after the date the optionee
ceases to perform services for the Company or any ISO Group member (for reasons
other than death, disability or cause), one year after the date the optionee
ceases to perform services for the Company or any other ISO Group member if
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cessation is due to death or disability, or the date the optionee ceases to
perform services for the Company or any ISO Group member if cessation is for
cause. No NSO may be exercised more than ten years from the date of grant, three
months after the date the optionee ceases to perform services for the Company or
any affiliated group member (for reasons other than death, disability,
retirement or cause), one year after the date the optionee ceases to perform
services for the Company or any affiliated Group member if cessation is due to
death, disability or retirement, or the date the optionee ceases to perform
services for the Company or any Affiliated Group member if cessation is for
cause.
PRICING AND PAYMENT OF OPTIONS. The per share exercise price of each stock
option granted under the 1999 Plan is established by the Committee at the time
of grant. In the case of an ISO, the per share exercise price may be no less
than 100% of the fair market value of a share of Common Stock on the date of
grant (110% in the case of an optionee who owns, directly or indirectly, 10% or
more of the outstanding voting power of all classes of stock of the Company).
The per share exercise price of an NSO may be any amount determined in good
faith by the Committee. With respect to ISOs, the aggregate fair market value of
the Common Stock for which one or more options granted to an optionee may become
exercisable during any one calendar year may not exceed $100,000.
Under the 1999 Plan, the purchase price of an option is payable upon
exercise: (i) in cash; (ii) by check; (iii) to the extent permitted by the
particular option grant, by transferring to the Company shares of Common Stock
of the Company at their fair market value as of the option exercise date
(provided that the optionee held the shares of stock for at least six months);
or (iv) if permitted by the Company, through a sale and remittance procedure by
which an optionee delivers concurrent written instructions to a brokerage firm
to sell immediately the purchased Common Stock and remit to the Company
sufficient funds to pay for the options exercised and by which the certificates
for the purchased Common Stock are delivered directly to the brokerage firm. The
Company may also extend and maintain, or arrange for the extension and
maintenance of, credit to an optionee to finance the purchase of shares pursuant
to the exercise of options, on such terms as may be approved by the Board of
Directors or the Committee, subject to applicable regulations of the Federal
Reserve board and any other applicable laws or regulations in effect at the time
such credit is extended.
The Committee may require, as a condition to exercise of an option, that
the optionee pay to the Company the entire amount of taxes which the Company is
required to withhold by reason of such exercise, in such amount as the Committee
or the Board of Directors may determine.
Subject to certain limitations, the Committee may modify, extend or renew
outstanding options. The Committee may not reduce the exercise price of
outstanding options or accept the surrender of outstanding options and grant new
options in substitution. Each option may have additional terms and conditions
consistent with the Plan as determined by the Committee.
EXERCISE. The Committee has the authority to determine the vesting and
exercise provisions of all grants under the 1999 Plan. In general under the 1999
Plan, no option shall be exercisable during the lifetime of an optionee by any
person other than the optionee, or a guardian or legal representative.
MERGER, CONSOLIDATION OR REORGANIZATION. In the event of a merger
consolidation or reorganization with another corporation in which the Company is
not the surviving corporation, the Board of Directors, the Committee (subject to
approval of the Board) or the board of directors of any corporation assuming the
obligations of the Company shall either (a) protect each outstanding and
unexercised option by the substitution on an equitable basis of appropriate
shares of the surviving corporation or (b) cancel each such option and make a
cash payment to the optionee.
TERMINATION OR AMENDMENT OF THE 1999 PLAN. The Board of Directors may amend
or modify the 1999 Plan at any time; provided, that shareholder approval shall
be obtained for any action for which shareholders approval is required in order
to comply with Rule 16b-3, the Code, or other applicable laws or regulatory
requirements within such time periods prescribed. The 1999 Plan will terminate
on January 19, 2009, unless sooner terminated by the Board of Directors.
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The discussion that follows is a summary, based upon current law, of some
of the significant federal income tax considerations relating to awards under
the 1999 Plan. The following discussion does not address state, local or foreign
tax consequences.
An optionee will not recognize taxable income upon the grant or exercise of
an ISO. However, upon the exercise of an ISO, the excess of the fair market
value of the share received on the date of exercise over the exercise price of
the shares will be treated as a tax preference item for purposes of the
alternative minimum tax. In order for the exercise of an ISO to qualify for the
foregoing tax treatment, the optionee generally must be an employee of the
Company from the date the ISO is granted through the date three months before
the date of exercise, except in the case of death or disability, where special
rules apply. The Company will not be entitled to any deduction with respect to
the grant or exercise of an ISO.
If shares acquired upon exercise of an ISO are not disposed of by the
optionee within two years from the date of grant or within one year after the
transfer of such shares to the optionee (the "ISO Holding Period"), then (i) no
amount will be reportable as ordinary income with respect to such shares by the
optionee and (ii) the Company will not be allowed a deduction in connection with
such ISO or the Common Stock acquired pursuant to the exercise of the ISO. If a
sale of such Common Stock occurs after the ISO Holding Period has expired, then
any amount recognized in excess of the exercise price will be reportable as a
long-term capital gain, and any amount recognized below the exercise price will
be reportable as a long-term capital loss. The exact amount of tax payable on a
long- term capital gain will depend upon the tax rates in effect at the time of
the sale. The ability of an optionee to utilize a long-term capital loss will
depend upon the statutory limitations on capital loss deductions not discussed
herein.
A "disqualifying disposition" will generally result if Common Stock
acquired upon the exercise of an ISO is sold before the ISO Holding Period has
expired. In such case, at the time of a disqualifying disposition, the optionee
will recognize ordinary income in the amount of the difference between the
exercise price and the lesser of (i) the fair market value on the date of
exercise or (ii) the amount realized on disposition. Any amount realized on the
sale in excess of the fair market value of the date of exercise will be treated
as a capital gain. If the amount realized on the sale is less than the exercise
price, the optionee will recognize no ordinary income, and the loss will be
reportable as a capital loss. The Company will be allowed a tax deduction in the
year of any disqualifying disposition equal to the amount of ordinary income
recognized by the optionee.
In general, an optionee to whom an NSO is granted will recognize no taxable
income at the time of the grant. Upon exercise of an NSO, the optionee will
recognize ordinary income in an amount equal to the amount by which the fair
market value of the Common Stock on the date of exercise exceeds the exercise
price of the NSO, and the Company will generally be entitled to a deduction
equal to the ordinary income recognized by the optionee in the year the optionee
recognizes ordinary income, subject to the limitations of Section 162(m) of the
Code.
VALUATION
As of August 13, 1999, the closing sale price for the Company's Common
Stock, as reported on the OTC Bulletin Board, was $6.50 per share. Because of
the limited and sporadic trading of the Company's stock, the Company does not
believe an established public trading market has been created for the Common
Stock.
OPTION GRANTS
As of the date of this proxy statement, the Company's only future records
under the 1999 Plan are two option grants of an aggregate of 22,000 shares of
the Company's common stock to two new employees.
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REQUIRED VOTE
The affirmative vote of the holders of a majority of the shares of Common
Stock present (or represented) and entitled to vote at the Annual Meeting is
required for the approval of this proposal. For purposes of the vote on this
proposal, abstentions will have the same effect as votes against this proposal
and broker non-votes will not be counted as shares entitled to vote on the
matter and will have no effect on the result of the vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL
OF THIS 1999 STOCK INCENTIVE PLAN
PROPOSAL 3: APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed McGladrey & Pullen, L.L.P. as
independent auditors to audit the financial statements of the Company for the
fiscal year ending March 31, 2000 and recommends that stockholders vote FOR
ratification of such appointment. In the event of a negative vote on such
ratification, the Board will reconsider its selection.
McGladrey & Pullen, L.L.P. has audited the Company's financial statements
annually since June 23, 1998. Its representatives are expected to be present at
the Annual Meeting with the opportunity to make a statement if they desire to do
so and are expected to be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL
OF THE APPOINTMENT OF MCGLADREY & PULLEN, L.L.P. AS INDEPENDENT AUDITORS
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OTHER MATTERS
The Company knows of no other matters to be submitted at the Annual
Meeting. If any other matter properly comes before the Annual Meeting, it is the
intention of the persons named in the enclosed proxy card to vote the shares
they represent as the Board of Directors may recommend.
STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company which are intended to be presented
by such stockholders at the Company's Annual Meeting for the fiscal year ending
March 31, 2000 must be received by the Company no later than April 30, 2000 in
order that they may be considered for inclusion in the proxy statement and form
of proxy relating to that meeting. Additionally, if a stockholder wishes to
present to the Company an item for consideration as an agenda item for a
meeting, he must timely give notice to the Secretary and give a brief
description of the business desired to be discussed. To be timely for the 1999
Annual Meeting, such notice must be delivered to or mailed to and received by
the Company no later than 5:00 p.m. local time on September 17, 1999.
September 2, 1999 THE BOARD OF DIRECTORS
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PROXY SITEK, INCORPORATED
1817 WEST FOURTH STREET
TEMPE, ARIZONA 85281
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Dr. Don M. Jackson and Gloria Zemla as
Proxies, each with the power to appoint his or her substitute, and hereby
authorizes each of them to represent and to vote, as designated below, all the
shares of Common Stock of Sitek, Incorporated held of record by the undersigned
on August 2, 1999, at the Annual Meeting of Stockholders to be held on September
28, 1999 or any adjournment thereof.
Item 1. ELECTION OF DIRECTORS
Nominees: Dr. Don M. Jackson, Jr., Maurice L. McGill, L. Richard Myers and
Dr. Daniel L. Shunk.
Dr. Don M. Jackson, Jr. [ ] FOR NOMINEE [ ] WITHHOLD VOTE FOR NOMINEE
Maurice L. McGill [ ] FOR NOMINEE [ ] WITHHOLD VOTE FOR NOMINEE
L. Richard Myers [ ] FOR NOMINEE [ ] WITHHOLD VOTE FOR NOMINEE
Dr. Daniel L. Shunk [ ] FOR NOMINEE [ ] WITHHOLD VOTE FOR NOMINEE
FOR AGAINST ABSTAIN
Item 2. APPROVAL OF 1999 STOCK INCENTIVE PLAN [ ] [ ] [ ]
Item 3. APPOINTMENT OF INDEPENDENT ACCOUNTANTS [ ] [ ] [ ]
Item 4. In their discretion, the Proxies are [ ] [ ] [ ]
authorized to vote upon such other
business as may properly come before
the meeting or any adjournment thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE NOMINEES.
Please sign exactly as name appears below. When shares are held by more
than one owner, all 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 authorized
officer. If a partnership, please sign in partnership name by authorized person.
------------------------------------------- Dated: , 1999
Signature
-------------------------------------------
Signature
NOTE: Please be sure to date this Proxy.
