SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. __________)
Filed by the Registrant X
Filed by a Party other than the Registrant
Check the appropriate box:
Preliminary Proxy Statement
Confidential, for Use of the Commission Only (as permitted
by
Rule 14a-6(e) (2))
x Definitive Proxy Statement
x Definitive Additional Materials
Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Micel Corp.
_______________________________________________________________________________
(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 Rule 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:
_______________________________________________________________________________
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:
ctc\schedule.14a
MICEL CORP.
445 CENTRAL AVENUE
CEDARHURST, NEW YORK 11516
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD FRIDAY, NOVEMBER 15, 1996
TO OUR SHAREHOLDERS:
The Annual Meeting of Shareholders of Micel Corp. (the "Company") will be
held at the offices of Singer Zamansky LLP, 40 Exchange Place, New York, New
York 10005, on Friday, November 15, 1996 at 10:00 A.M. E.S.T., to consider
the following proposals:
1. To elect four directors, each to serve for a term of one year or until
their respective successors are elected and qualify;
2. To ratify the appointment of Arthur Andersen & Co. as independent auditors
of the Company;
3. To authorize a one-for-ten reverse stock split of the Companys Common Stock;
4. To approve the amendment to the Companys 1990 Stock Option Plan increasing
the number of shares of Common Stock which may be issued under the Plan from
2,500,000 to 8,000,000; and
5. To transact such other business as may properly come before the meeting.
Shareholders of record on the books of the Company at the close of business on
October 11, 1996 will be entitled to vote at the meeting or any adjournment
thereof. A copy of the annual report containing the financial statements of
the Company for the fiscal year ended September 30, 1995 is enclosed.
All Shareholders are cordially invited to attend the meeting. Whether or
not you expect to attend, you are requested to sign, date and return the
enclosed proxy promptly. Shareholders who execute proxies retain the right
to revoke them at any time prior to the voting thereof. A return envelope
which requires no postage if mailed in the United States is enclosed for your
convenience.
Dated: New York, New York
October 15, 1996
By Order of the Board of Directors
Marvin Neiman, Secretary
MICEL CORP.
445 CENTRAL AVENUE
CEDARHURST, NEW YORK 11516
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of Micel Corp. (the "Company") of proxies in the enclosed
form for the Annual Meeting of Shareholders to be held at the offices of
Singer Zamansky LLP, 40 Exchange Place, 20th Floor, New York, New York 10005
on Friday, November 15, 1996, at 10:00 A.M. (E.S.T.), and for any
adjournment or adjournments thereof, for the purposes set forth in the
foregoing Notice of Annual Meeting of Shareholders.
Any shareholder giving such a proxy has the power to revoke the same at any
time before it is voted by giving written notice to the Secretary of the
Company or by providing him with a later-dated proxy. Attendance at the
meeting shall not have the effect of revoking a proxy unless the Shareholder
so attending shall, in writing, so notify the Secretary of the meeting at any
time prior to the voting of the proxy.
The principal executive offices of the Company are located at 445 Central
Avenue, Cedarhurst, New York 11516, telephone number 516-569-3500. The
approximate date on which this Proxy Statement and the accompanying form of
proxy will first be sent or given to the Company's shareholders is October
13, 1996.
VOTING SECURITIES
Holders of shares of Common Stock, par value $.001 per share (the
"Shares"), of record as at the close of business on October 11, 1996, are
entitled to vote at the meeting. On the record date, there were issued and
outstanding 53,153,800 Shares. Each outstanding Share is entitled to one
vote upon all matters to be acted upon at the meeting. The holders of a
majority of the aggregate of the outstanding shares of Common Stock voting as
a group shall constitute a quorum.
PRINCIPAL STOCKHOLDERS
The following table sets forth as of September 16, 1996, certain
information as to the stock ownership of each person known by the Company to
beneficially own 5% or more of the Company's outstanding Common Stock, by
each director of the Company who owns any shares of the Company's Common
Stock and by all officers and directors as a group:
Percentage of
Name of Amount and Nature of Class as of
Beneficial Owner Beneficial Ownership(1) Sep. 16, 1996
Bonnie Septimus (2) 4,460,000 8.9%
72 Lord Avenue
Lawrence, New York
Barry Septimus (3) 4,954,365 9.7%
72 Lord Avenue
Lawrence, New York
Benjamin Sporn 480,000 (4) *
Heather Loren 2,300,250 4.6%
Barry Braunstein (4) 1,020,000 2%
Ron Levy -0- *
All officers and directors
as a group (5 persons) 3,800,250 7.1%
* Less than 1%
(1) Except as otherwise indicated, all shares are beneficially owned, and
sole voting and investment power is held by the persons named.
(2) This includes 60,000 shares of Common Stock owned by certain of her
children but does not include shares listed below owned by her husband,
Barry Septimus, shares of Common Stock held in trust for her children where
she is not the Trustee or shares owned by her independent children.
(3) Does not include Shares owned by Mr. Septimus' children or his wife,
Bonnie Septimus, listed above. Mr. Septimus disclaims beneficial ownership
of these Shares. The amount includes 2,240,000 shares of Common Stock owned
by Quest Enterprises, Inc., which is 50% owned by Mr. Septimus. Also
includes 614,365 Shares issuable upon exercise of options and warrants owned
by Quest Enterprises, Inc.
(4) Includes 30,000 Shares issuable upon exercise of stock options.
(5) Consists of 20,000 Shares issuable upon exercise of stock options and
Shares which have been purchased by Mr. Braunstein's family in a private
placement in September 1994. Mr. Braunstein disclaims beneficial interest in
these shares.
PROPOSAL 1
ELECTION OF DIRECTORS
At the meeting, four Directors will be elected by the shareholders to serve
until the next annual meeting of the shareholders or until their successors
are elected and shall qualify. The accompanying form of proxy will be voted
for the election as Directors of the four persons named below, unless the
proxy contains contrary instructions. Proxies cannot be voted for a greater
number of persons than the number of nominees named in the Proxy Statement.
Management has no reason to believe that any of then
es should become unable or unwilling to serve as a Director, the proxy will
be voted for the election of such person or persons as shall be designated by
the Directors.
The following is information about each nominee:
Benjamin Sporn (age 58) has been a Director of the Company since December
1990 and Chairman of the Board since November 17, 1993. Mr. Sporn has been
an attorney in private practice since January 1990 and Vice President-Legal
of Applied Microbiology, Inc. since 1992.
From 1964 until December 1989, Mr. Sporn was an attorney with AT&T and
retired as General Attorney for Intellectual Property Matters. Mr. Sporn is
Chairman of Creative Technologies Corp.
Barry Braunstein (37) has been a Director of the Company since April 1994.
From June 1983 to the present, he has been the administrator of Laconia
Nursing Home in Bronx, New York. Mr. Braunstein received his B.A. Degree
from Adelphia University in 1985.
Heather Loren (28) has been a Director of the Company since August 1995.
From September 1994 until the present, Ms. Loren has been a consultant with
the firm of Coopers & Lybrand, LLP. From December 1991 until August 1992,
she was in geriatric research at Hadasa Hospital in Jerusalem. From June,
1989 until December 1991 she held various managerial positions at the
Bridgeport Healthcare Center and White Plains Nursing Home. She received her
Masters degree in Management from Northwestern University in 19
Ron Levy, (48) has been President and Director of the Company since October
1, 1996. Prior to that time he was a consultant to Microkim Ltd, the
Companys wholly owned subsidiary. From October 1992 to November 1995 he was
President and Chief Executive Officer at EUROM FlashWare Solutions Ltd. and
from September 1990 to September 1992 he was Project Manager at SanDisk
Corporation in Santa Clara, CA. From September 1982 until September 1990 he
was a manager of Tadiran Communication Micro Electronic Cente
The Board of Directors held four meetings in the fiscal year ended September
30, 1996. The Company does not have a standing audit, nominating or
compensation committee. To the Company's knowledge, there were no
delinquent 16(a) filers for transactions in the Company's securities during
fiscal year ended September 30, 1996.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE ELECTION
OF THE ABOVE NAMED NOMINEES. PROXIES SOLICITED BY THE BOARD OF DIRECTORS
WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY IN THEIR PROXIES A CONTRARY
CHOICE.
Executive Compensation
The following table sets forth all compensation received for services
rendered to the Company by certain executive officers during each of the past
three fiscal years. No other executive officer received compensation in
excess of $100,000 during any of the last three fiscal years.
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
Name and Principal
Position Year Salary ($) Other Annual Awards Options
Compensation
Joseph Moscovitz, President
Chief Executive Officer
1995
$76,976
18,323 (1)
150,000
1994 (2)
$36,153
$8,424(1)
-0-
____________________________
(1) Total value of non-cash compensation.
(2) Represents compensation for a partial year. In 1994 he was compensated
at the rate of $82,204 per annum.
OPTION GRANTS IN 1995
Percent of Total
Name (a) Options Granted
Options Granted (b) To Employess in Exercise Expiration
Fiscal Year 1955 Price (d) Date (e)
Joseph Moscovitz 150,000 27% $.06 November, 2000
____________________________
(1) Exercisable to the extent of 25% on December 31, 1995 and 25% per year on
December 31, 1996, December 31, 1987 and December 31, 1998.
AGGREGATED OPTION EXERCISES IN 1995 AND FOR YEAR-END VALUES
Value of
Unexercised
Number of Unexercised in-the-money
Options at
Fiscal Year
Options at at Fiscal year End
End
Shares Acquired Value Exercisable/ Exercisable/
on Exercise (#) (b) Realized ($) Unexercisable(d) Unexercisable(e)
Joseph Moscoviz -0- -0- 0/150,000 0-/-0-
In November, 1994, the Board of Directors granted stock options in the
amount of 120,000 Shares to Benjamin Sporn, 80,000 Shares to Barry Braunstein
and 50,000 Shares to Tzvi Siegel and in November 1995, the Board of
Directors granted stock options in the amount of 80,000 Shares to Heather
Loren and 100,000 Shares to Joel Golevensky. The options are exercisable for
six years from the date of grant at $.06 per Share. The options vest at the
rate of 25% of such grant per year with the first installment exe
able December 31, on the year following the year of grant. As part of a
marketing agreement, the Company granted Quest Enterprises, Inc., a stock
option to purchase 100,000 Shares of Common Stock, which is currently
exercisable at $.06 per Share and in May 1995 additional stock options to
purchase 966,200 Shares at $.06875 per Share exercisable at the rate of 25%
per year with the first installment starting May 23, 1996. Mr. Septimus owns
50% of the Quest Enterprises, Inc. See "Certain Relations and Rela
Transactions."
The Shareholders in 1992 approved an amendment to the Company's By-Laws to
provide that the Company may pay the Board of Directors annual and/or per
meeting Director's Fees. The Company intends to compensate outside directors
$6,000 per year.
Stock Option Plan
In November 1990, the Company's Board of Directors adopted, and its
Shareholders approved, the 1990 Stock Option Plan (the "Plan"), which was
amended by the Shareholders at the 1994 annual meeting and provides for the
grant of incentive and/or non-qualified stock options to purchase up to
2,500,000 shares of Common Stock to any officer, director, consultant or
employee when the Board, in its sole discretion, determines that a grant of
options to such person would be in the best interests of the Company. T
Shares issuable under the plan to 8,000,000. Incentive stock options
granted under the Plan shall be pursuant to a written agreement for a term
not exceeding ten (10) years (five (5) years for Shareholders owning more
than ten percent (10%) of the Common Stock of the Company). The exercise
price of the options shall be established by the Board at the time of grant
of the option but cannot be less than one hundred percent (100%) of the fair
market value at the time of grant of the option. If the recipie
st one hundred and ten percent (110%) of the fair market value of the
underlying Common Stock at the time of grant. The aggregate fair market
value (determined as of the date of grant) of the shares of Common Stock with
respect to which incentive stock options are exercisable for the first time
by an employee during any calendar year may not exceed $100,000. Other terms
and conditions of options granted under the Plan, which expires November
2000, are determined by the Board of Directors. The number of s
, stock dividend, recapitalization, combination, subdivision, issuance of
rights or other similar corporate change. Persons who are residents of the
State of Israel for the purpose of the Israeli Currency Control Regulations,
who own more than 5% of the total outstanding shares of the Company would be
required to get the consent of the Bank of Israel to accept offers of stock
options from the Company.
CERTAIN TRANSACTIONS
In January 1993, the Company entered into an agreement with Quest
Enterprises, Inc. ("Quest"), of which Barry Septimus, a principal shareholder
of the Company, owns 50%, to provide marketing, consulting and other
services as reasonably required by the Company for the purpose of securing
for the Company research and development contracts, joint development
programs, strategic partnerships, business opportunities and production and
sales contracts with North American Companies and other entities on an exclus
penses (reduced from $6,000 per month). In addition, in the event that the
services provided by Quest to the Company result in a contract being awarded
to the Company, Quest will be entitled to a commission in the amount of 1.5%
of the revenues received. In September 1996, Quest voluntarily reduced this
percentage to 1% at the same time as the Company employed Ron Levy who is to
receive .05% of U.S. sales. In the event that the services provided by
Quest result in a joint venture or other equity arrange
e equity position in such joint venture not to exceed 15% of the equity of
the joint venture. Quest is also entitled to 25% of any royalties received
by the Company from parties introduced to the Company by Quest. The Company
also granted Quest in January 1993 an option to acquire 100,000 shares of
Micel Corp. Common Stock exercisable at $.06 per share, to the extent of
25,000 options immediately and 25,000 options each year commencing on January
15, 1994. The option expires three years after termination
In August 1994, Quest agreed to assist Microkim in management and
operations. In November 1994, the Shareholders approved the issuance of a
warrant to Quest to purchase 614,365 shares of Common Stock of the Company at
$.06 per share. In May 1995, the Board of Directors granted Quest a stock
option exercisable to purchase an additional 966,200 shares of Common Stock
at $.06875 per share. The options vest at a rate of 25% per year, with the
first installment vesting on May 23, 1996. In August 1996, the C
es issuable under the Plan, an additional option to purchase 1,000,000 shares
of Common Stock, $.001 par value, at $.20 per share, exercisable in four
equal annual installments commencing on August 18, 1997.
In September 1994, the Company sold 11,200,000 shares of Common Stock in a
private placement at $.05 per Share. The family of Barry Braunstein
purchased 1,000,000 Shares, Barry Septimus purchased 2,000,000 Shares and
Bonnie Septimus purchased 1,000,000 Shares. In addition, the children of
Bonnie and Barry Septimus purchased an aggregate of 3,500,000 Shares. As of
March 1996, independent children of Barry Septimus purchased 500,000 Shares
of the Company at $.05 per Share and Benjamin Sporn purchase 360,0
In August 1996, the Board of Directors approved, subject to obtaining
shareholder approval of the proposal to amend the Plan, options to each of
the current directors to purchase 250,000 shares of Common Stock at $.20 per
share, exercisable in four equal annual installments, commencing on August
18, 1997. In addition, the Company granted to Mr. Mark Loren, consultant to
the Company, and father of Ms. Heather Loren, a director of the Company, an
option to purchase 500,000 shares of Common Stock on the same
PROPOSAL 2
APPROVAL OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed Arthur Andersen & Co., independent
public accountants, to audit the accounts of the Company for the fiscal year
ending September 30, 1996. Arthur Andersen & Co. also audited the accounts
of the Company for the fiscal years ended September 30, 1992 through 1995.
Arthur Andersen & Co. has advised the Company that neither the firm nor any
of its members or associates has any direct financial interest in the Company
other than as auditors. Although the selection and app
deem it desirable to obtain the shareholders' ratification and approval of
this appointment.
Representatives of Arthur Andersen & Co. 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.
Approval of the proposal requires the affirmative vote of a majority of the
Shares voted with respect thereto. In the event the proposal is not
approved, the Board will consider the negative vote as a mandate to appoint
other independent auditors of the Company for the next fiscal year.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
RATIFICATION OF THE APPOINTMENT OF THE AUDITORS.
PROPOSAL 3
AUTHORIZATION OF A ONE FOR TEN REVERSE STOCK SPLIT
The Board of Directors of the Company has adopted a proposal declaring
advisable an amendment to the Certificate of Incorporation of the Company to
effect a one-for-ten reverse stock split of all of the authorized and
outstanding Common Stock. As of October 1, 1996, the Company had authorized
85,000,000 shares of Common Stock, $.001 par value. As of that date, there
were issued and outstanding 53,153,800 shares of Common Stock. Except for
the receipt of cash in lieu of fractional interest, the proposed re
The Company also had, as of October 1, 1996, 5,000,000 shares of Preferred
Stock authorized of which 810 were previously issued but none of which is
currently outstanding. The Preferred Stock will not be affected by the
proposed reverse split.
The amendment will not have any material impact on the aggregate capital
represented by the Shares for financial statement purposes. Adoption of the
reverse stock split will reduce the number of presently outstanding shares,
as indicated on the table below and will provide for a corresponding increase
in the par value from $.001 per Share to $.01 per Share. The Certificate of
Incorporation will in the process be amended to set the number of authorized
shares of Common Stock at 25,000,000, $.01 par value.
any resulting fractional share, or both, in exchange for ten currently
outstanding Shares.
Class of Stock Outstanding Before Split Outstanding After Split
Common Stock 53,153,800 5,315,380
The number of outstanding shares after the reverse stock split is
approximate. Except for changes resulting from the reverse stock split and
the increase in the par value from $.001 to $.01 par value, the rights and
privileges of holders of Shares of Common Stock will remain the same, both
before and after the proposed reverse stock split.
Reasons for the Reverse Stock Split
Management believes that the decrease in the number of Shares of Common Stock
outstanding as a consequence of the proposed reverse stock split should
increase the per Share price of the Common Stock, which may encourage greater
interest in the Common Stock and possibly promote greater liquidity for the
Company's Shareholders. However, the increase in the per Share price of the
Common Stock as a consequence of the proposed reverse stock split may be
proportionately less than the decrease in the number of Sh
ially or entirely offset by the reduced number of Shares outstanding after
the proposed reverse stock split. Nevertheless, the proposed reverse stock
split could result in a per Share price that adequately compensates for the
adverse-impact of the market factors noted above. There can, however, be no
assurance that the favorable effects described above will occur, or that any
increased per Share price of the Common Stock resulting from the proposed
reverse stock split, if attained, will be maintained for
sactions or business combinations which would qualify the Company for
deregistration of the Common Stock from the reporting and other requirements
of Federal securities laws.
The amendment, if adopted, will also increase the par value per share of the
Company's authorized Shares of Common Stock from $.001 to $.01. The increase
in the par value per Share is intended to maintain the Company's capital
stock accounts at current levels.
It is expected that if the shareholders authorize this amendment that the
filing of the Certificate of Amendment will occur as soon as practical after
the date of the Shareholders meeting. The proposed reverse stock split will
become effective on the effective date of that filing (the "Effective
Date"). Commencing on the Effective Date, each currently outstanding
certificate will be deemed for all corporate purposes to evidence ownership
of the reduced number of Shares resulting from the reverse stock sp
n connection with the reverse stock split. Rather, new stock certificates
reflecting the number of Shares resulting from the stock split will be issued
only as currently outstanding certificates are transferred. However, the
Company will provide shareholders with instructions as to how to exchange
their certificates and encourage them to do so. The company will obtain a
new CUSIP number for its Shares.
To the extent a Shareholder holds a number of Shares that would result in a
residual fractional interest, the Company will pay, as soon as is practicable
after the Effective Date, $.38 for each Share of Common Stock outstanding
prior to the reverse stock split that comprises the factional interest.
Shareholders will not have the opportunity on or after the Effective Date to
round off their shareholdings to avoid resulting fractional interest. The
$.38 price per Share figure for the Common Stock purchased
s reported on September 16, 1996. In view of this, the management of the
Company believes that the $.38 price per Share figure is fair to all of the
shareholders whose fractional interests are retired, the other shareholders
of the Company and the Company. As of September 16, 1996, the Company has
approximately 65 Shareholders of record and believes that the approximate
total number of beneficial holders of the Common Stock of the Company to be
approximately 750 based upon information received from the transfer ag
any estimates that, based upon the shareholdings as of September 16, 1996, it
will continue to have approximately the same number of shareholders after
the reverse stock split is effected as it did prior to the reverse split.
There can be no assurance that the market price of the Shares after the
proposed reverse stock split will be ten the market price before the proposed
reverse stock split, or that such price will either exceed or remain in
excess of the current market price.
Warrants, Options and Preferred Stock
The Company currently has outstanding warrants owned by one entity
exercisable to purchase 614,365 Shares. In addition, there are stock options
outstanding under the Companys stock option plans to purchase approximately
2,041,200 Shares and 3,500,000 additional shares subject to approval by the
Shareholders of Proposal 4 herein. After approval of the reverse stock
split, the number of Shares to be issued upon exercise of the outstanding
warrants and options will be reduced to one-tenth of the previous am
Federal Income Tax Consequences
The federal income tax consequences of the proposed reverse stock split will
be as set forth below. The following information is based upon existing law
which is subject to change by legislation, administrative action and judicial
decision and is therefore necessarily general in nature. Therefore,
shareholders are advised to consult with their own tax advisors for more
detailed information relating to their individual tax circumstances.
1 The proposed reverse stock split will be a tax-free recapitalization of the
Company and its shareholders to the extent that currently outstanding shares
of stock are exchanged for other shares of stock after the split.
r shares of stock after the split.
2 The new shares of Common Stock in the hands of a Shareholder will have an
aggregate basis for computing gain or loss equal to the aggregate basis of
shares of stock held by that Shareholder immediately prior to the proposed
reverse stock split if no fractional shares are present. If fractional
shares are present as a result of the split, and the shareholder realizes a
gain on the exchange, the shareholder will recognize a taxable gain equal to
the lesser of the cash received or the gain realize
red until the shareholder disposes of the new stock in a taxable transaction.
The stockholder's basis in the new stock is equal to the basis in the stock
exchanged, less any cash received plus gain recognized, if any.
3 Shareholders who receive cash for fractional shares will be treated as if
they had received such fractional shares and then sold them to the Company.
Such shareholders will recognize gain or loss equal to the difference between
the amount of cash received and their basis in the stock exchanged.
Approval Required
The approval of a majority of the outstanding stock entitled to vote will be
necessary to approve the proposed amendment.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE AMENDMENT
TO THE CERTIFICATE OF INCORPORATION TO EFFECT A ONE FOR TEN REVERSE STOCK
SPLIT.
PROPOSAL 4
AMENDMENT TO 1990 STOCK OPTION PLAN
There will be presented to the shareholders at the Annual Meeting a
proposal to amend the 1990 Stock Option Plan (the "Plan") to increase the
number of Shares of Common Stock which may be issued under the Plan from
2,500,000 Shares to 8,000,000 Shares.
This amendment was approved by the Board of Directors, subject to
Shareholder approval. It will become effective on the date of the Annual
Meeting if a majority of the Shares represented in person or by proxy is
voted in favor of the amendment.
As of September 9, 1996, 2,041,200 of the 2,500,000 Shares authorized for
issuance under the Plan as previously approved by Shareholders, were covered
by outstanding unexercised options. 1,075,000 Shares are exercisable at $.06
per Share and 966,200 at $.068575 per Share.
In addition, the Company entered into an employment agreement with Mr. Ron
Levy who will be the President of the Company, which provides that, subject
to the approval by the Shareholders of this amendment to the 1990 Stock
Option Plan at this meeting, he shall receive an incentive stock option to
purchase 1,000,000 shares of Common Stock of the Company at $.20 per Share,
exercisable until October 1, 2001, in equal annual quarterly installments
commencing on October 1, 1997. In the event that this amendment
f which have been discussed or are contemplated.
The Board of Directors has determined that it is in the best interest of
the Company to maintain the availability of this important incentive program
by increasing the number of Shares covered by the Plan.
The Plan permits the grant of options under incentive stock option
agreements ("Incentive Options") or non-statutory stock option agreements
("Non-Statutory Options"). The Plan is administered by the Board of
Directors. Those persons eligible to participate are officers, Directors and
other key employees and consultants of the Company. The Board has sole
discretion to determine from among eligible persons those to whom, and the
time or times at which, options may be granted, the number of Shares to be
The Plan prohibits the granting of an Incentive Option if the aggregate
fair market value of Shares relating to Incentive Options which are
exercisable by an optionee for the first time during any calendar year
exceeds $100,000.
The Company has also granted, subject to the approval by the Shareholders
of this Proposal, an option to Quest Enterprises, Inc. (Quest) to purchase
1,000,000 shares of Common Stock. See Certain Transactions for a
description of the services that Quest provides to the Company. The option
is exercisable to purchase the stock at $.20 per Share for a period of five
years and vesting in equal quarterly annual installments commencing August
18, 1997. On the same terms set forth above, the Company also
The number of Shares subject to the options described above do not take
into consideration the proposed one-for-ten reverse stock split described in
Proposal 3 in this proxy. If the reverse split amendment is approved by the
Shareholders, the number of Shares subject to these options would be one-
tenth and the exercise price would be multiplied by ten.
The per Share exercise price of the Shares subject to each Incentive Option
may not be less than the fair market value of the Shares on the date the
Incentive Option is granted. Incentive Options must be granted within ten
years from the effective date of the Plan and the period for exercise of
each Incentive Option cannot exceed ten years form the date of grant. The
exercise price of any Incentive Option granted to a shareholder owning more
than 10% of the outstanding Shares must be not less than 110%
xceed five years.
No incentive Stock Option may be exercised unless and until the optionee
has remained in the employ of the Company or its subsidiaries or providing
services as a consultant for one year from the date of grant, except in the
case of death, retirement or disability as described below. No Option will
be transferable by an optionee other than by will or the laws of descent and
distribution, and during the lifetime of an optionee the Option will be
exercisable only by him.
bed below. No Option will be transferable by an optionee other than by will
or the laws of descent and distribution, and during the lifetime of an
optionee the Option will be exercisable only by him.
In the event of termination of employment, other than by death or
disability of an optionee who has remained in the employ of the Company for
one year after grant of the Option, the optionee will have three months after
such termination within which to exercise the Option to the extent it was
exercisable at the date of such termination (subject to the requirement that
the Option be exercised, if at all, no later than the date of expiration).
Upon termination of employment of an optionee by reason of dea
extent it was exercisable on the date of such termination.
MANAGEMENT RECOMMENDATION
By affording key present or future employees and consultants of the Company
an opportunity to acquire or increase their proprietary interest in the
Company and by thus encouraging such individuals to become owners of the
Company's Common Stock, the Company seeks to motivate, retain and attract
those highly competent individuals upon whose judgment, initiative,
leadership and continued efforts the success of the Company in large measure
depends.
To the extent that the Directors will be receiving stock options in the
event that this proposal is approved by the Shareholders, the Directors would
be deemed to have an interest in the outcome of the vote.
FOR THIS REASON, THE BOARD OF DIRECTORS RECOMMENDS TO THE COMPANY'S
SHAREHOLDERS THAT THEY VOTE FOR APPROVAL OF AN INCREASE IN THE NUMBER OF
SHARES OF COMMON STOCK ISSUABLE UNDER THE PLAN.
VOTE REQUIRED
The affirmative vote of the majority of the votes represented in person or
by proxy is required for approval of the amendment to the Plan to increase
the number of options. Proxies solicited hereby will be voted FOR the
proposal unless a vote against the proposal or abstention is specifically
indicated.
GENERAL
The management of the Company does not know of any matters other than
those stated in this proxy statement which are to be presented for action at
the meeting. If any other matters should properly come before the meeting,
it is intended that proxies in the accompanying form will be voted on any
such matters in accordance with the judgment of the persons voting such
proxies. Discretion or authority to vote on such matters is conferred by
such proxies upon the persons voting them.
The Company will, of course, be assembling and mailing the proxy statement
and other material which may be sent to the shareholders in connection with
this solicitation. In addition to this solicitation of proxies by the use of
mails, officers and regular employees may solicit the return of proxies.
Costs for soliciting proxies will be borne by the Company. The Company may
reimburse persons holding stock in their names or in the names of other
nominees for their expense in sending proxies and proxy mat
The Company will provide without charge to each person being solicited by
this Proxy Statement, on written request of any such person, a copy of the
Audited Financial Statements for the year ended September 30, 1995 (as filed
with the Securities and Exchange Commission). All such requests should be
directed to Micel Corp., 445 Central Avenue, Cedarhurst, New York 11516,
telephone number 516-569-3500.
All proposals of shareholders intended to be included in the proxy
statement to be presented in the 1996 Annual Meeting materials must be
received by the Company's offices at 445 Central Avenue, Cedarhurst, New York
11516, no later than May 1, 1997.
Dated: October 15, 1996
By Order of the Board of Directors
Marvin Neiman, Secretary
PROXY
This Proxy is Solicited
on Behalf of the Board of Directors
MICEL CORP.
445 CENTRAL AVENUE
CEDARHURST, NEW YORK 11516
The undersigned hereby appoints David Selengut and Yelena Matatov as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated below, all the Shares of the
Common Stock of Micel Corp. held of record by the undersigned on October 11,
1996 at the Annual Meeting of Shareholders to be held on November 15, 1996 or
any adjournment thereof.
1. Election of Directors FOR all nominees listed below
(except as marked to the contrary below)
WITHHOLD AUTHORITY
to vote for all nominees below
(INSTRUCTION: To withhold authority to vote
for any individual nominee strike a line
through the nominee's name in the list below)
Benjamin Sporn,
Barry Braunstein, Heather Loren, Ron Levy
2. To ratify the appointment of Arthur Andersen & Co. as the independent
auditors for the Company for the fiscal year ending September 30, 1996.
FOR AGAINST ABSTAIN
3. To authorize a one-for-ten reverse stock split of the Companys Common
Stock.
FOR AGAINST ABSTAIN
4. To approve an amendment to the Companys 1990 Stock Option Plan increasing
the number of shares of Common Stock which may be issued under the Plan from
2,500,000 to 8,000,000.
FOR AGAINST ABSTAIN
This proxy, when properly executed, will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this proxy
will be voted for Proposals 1, 2, 3 and 4.
Please sign exactly as your name appears below. When shares are held by
joint tenants, both should sign.
Dated: , 1996
Signature
___________________________________
Signature if held jointly
When signing as attorney, executor administrator, trustee or guardian,
please give full title as such. If a Company, please sign in full corporate
name by President or other authorized officer. If a partnership, please sign
in partnership name by authorized person.
