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
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
PERCON 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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<PAGE>
PERCON INCORPORATED
Notice of Annual Meeting of Shareholders
May 23, 1997
To the Shareholders of Percon Incorporated:
The annual meeting of the shareholders of Percon Incorporated, a Washington
corporation, will be held at 9:00 a.m., Pacific Time, on May 23, 1997, at the
Valley River Inn, 1000 Valley River Way, Eugene, Oregon, for the following
purposes:
1. Electing directors to serve for the following year and until their
successors are elected; and
2. Transacting any other business that properly comes before the meeting.
Only shareholders of record at the close of business on March 24, 1997 will
be entitled to vote at the annual meeting.
You are respectfully requested to date and sign the enclosed proxy and
return it in the postage-prepaid envelope enclosed for that purpose. You may
attend the meeting in person even though you have sent in your proxy, since
retention of the proxy is not necessary for admission to or identification at
the meeting.
By Order of the Board of Directors
Andy J. Storment
Secretary
Eugene, Oregon
April 14, 1997
<PAGE>
PERCON INCORPORATED
PROXY STATEMENT
Annual Meeting of Shareholders
The mailing address of the principal executive offices of the Company is
1720 Willow Creek Circle, Suite 530, Eugene, Oregon, 97402-9171. The approximate
date this proxy statement and the accompanying proxy form are first being sent
to shareholders is April 14, 1997.
Upon written request to Andy J. Storment, Secretary, any person whose proxy
is solicited by this proxy statement will be provided, without charge, a copy of
the Company's Annual Report on Form 10-KSB.
SOLICITATION AND REVOCABILITY OF PROXY
The enclosed proxy is solicited on behalf of the Board of Directors of
Percon Incorporated, a Washington corporation, for use at the Annual Meeting of
Shareholders to be held on May 23, 1997 and at any adjournment thereof. The
Company will bear the cost of preparing and mailing the proxy, proxy statement,
and any other material furnished to shareholders by the Company in connection
with the annual meeting. Proxies will be solicited by use of the mails, and
officers and employees of the Company may also solicit proxies by telephone or
personal contact. Copies of solicitation materials will be furnished to
fiduciaries, custodians and brokerage houses for forwarding to beneficial owners
of the stock held in their names.
Any person giving a proxy in the form accompanying this proxy statement has
the power to revoke it at any time before its exercise. The proxy may be revoked
by filing with the Company, attention Andy J. Storment, Secretary, an instrument
of revocation or a duly executed proxy bearing a later date. The proxy may also
be revoked by affirmatively electing to vote in person while in attendance at
the meeting. However, a shareholder who attends the meeting need not revoke the
proxy and vote in person unless he or she wishes to do so. All valid, unrevoked
proxies will be voted at the annual meeting in accordance with the instructions
given.
1
<PAGE>
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
The Common Stock is the only outstanding authorized voting security of the
Company. The record date for determining holders of Common Stock entitled to
vote at the annual meeting is March 24, 1997. On that date there were 3,961,261
shares of Common Stock outstanding, entitled to one vote per share. The Common
Stock does not have cumulative voting rights.
The following table sets forth certain information regarding the beneficial
ownership as of February 28, 1997 of the Common Stock by (i) each person who
owns beneficially more than 5% of the outstanding shares of Common Stock, (ii)
each director of the Company, (iii) each executive officer of the Company named
in the Summary Compensation Table and (iv) all executive officers and directors
as a group. This information is based on information received from or on behalf
of the named individuals.
<TABLE>
<CAPTION>
Number of Shares Percentage
Beneficial Owner Beneficially Owned(1) of Shares
- ---------------- --------------------- ----------
<S> <C> <C>
Michael P. Coughlin (2).................... 641,641 16.2%
1720 Willow Creek Circle, Suite 530
Eugene, OR 97402
Andy J. Storment (3)....................... 641,541 16.2%
1720 Willow Creek Circle, Suite 530
Eugene, OR 97402
Arlen I. Prentice (4)...................... 395,000 9.9%
6177 162nd Place SW
Bellevue, WA 98006
James E. Navarre (5)....................... 317,391 8.0%
9428 NE 1st St.
Bellevue, WA 98004
Donald K. Skinner (6)...................... 20,000 *
2130 Kingsbridge Way
Oxnard, CA 93035
All directors and executive officers....... 1,756,516 43.6%
as a group (9 persons) (7)
- -----------------------
* Less than 1%
(1) Shares which the person or group has the right to acquire within 60 days
after February 28, 1997 are deemed to be outstanding in calculating the
percentage ownership of the person or group but are not deemed to be
outstanding as to any other person or group.
(2) Includes 629,075 shares held by the Coughlin Family Limited Partnership of
which Mr. Coughlin and his spouse are the general partners and also
includes 6,000 shares subject to options exercisable within 60 days after
February 28, 1997.
(3) Includes 6,000 shares subject to options exercisable within 60 days after
February 28, 1997.
(4) Includes 20,000 shares subject to options exercisable within 60 days after
February 28, 1997.
(5) Includes 15,000 shares subject to options exercisable within 60 days after
February 28, 1997.
(6) Includes 20,000 shares subject to options exercisable within 60 days after
February 28, 1997.
(7) Includes 65,333 shares subject to options exercisable within 60 days after
February 28, 1997. Excludes shares subject to options within 60 days after
that date.
</TABLE>
2
<PAGE>
PROPOSAL 1: ELECTION OF DIRECTORS
The directors of the Company are elected at the Annual Meeting to serve
until their successors are elected and qualified. All current directors are
nominees for re-election. If a quorum of shareholders is present at the annual
meeting, the nominees for election as directors who receive the greatest number
of votes cast at the meeting shall be elected directors. Abstentions and broker
non-votes will have no effect on the results of the vote. Unless otherwise
instructed, proxy holders will vote the proxies they receive for the nominees
named below. If any of the nominees for director at the annual meeting becomes
unavailable for election for any reason (none being known), the proxy holders
will have discretionary authority to vote pursuant to the proxy for a suitable
substitute or substitutes. The following table briefly describes the Company's
nominees for directors.
<TABLE>
<CAPTION>
Director
Name, Principal Occupation and Other Directorships Age Since
- -------------------------------------------------- --- --------
<S> <C> <C>
Michael P. Coughlin was a member of a private investor group that 42 1990
acquired the Company in July 1990 and has served as its President,
Chief Executive Officer and a Director since the acquisition.
Andy J. Storment was a member of a private investor group that 34 1990
acquired the Company in July 1990 and has served as its Vice
President, Secretary, Treasurer and a Director since the acquisition
and as the Company's Chief Operating Officer from July 1990 to
January 1997. In June 1995 Mr. Storment was promoted to
Executive Vice President.
Arlen I. Prentice was a member of a private investor group that 59 1990
acquired the Company in July 1990 and has served as a Director since
the Acquisition. In October 1993 he became Chairman of the Board.
Mr. Prentice is a founder of Kibble & Prentice, Inc., a financial
services firm. Mr. Prentice has served as Co-Chairman and Chief
Executive Officer of Kibble & Prentice, Inc. since June 1972. Mr.
Prentice serves as a director of Starbucks Coffee Corporation,
Western Drug Distributors (dba Drug Emporium Northwest),
Northland Telecommunications Corporation and Flow International,
Inc., a manufacturer and distributor of high pressure water jet
cutting systems.
Donald K. Skinner joined the Company's Board of Directors in 56 1995
March 1995. Mr. Skinner is Chief Executive Officer and Chairman
of the Board of Eltron International, Inc., a company that designs,
manufactures and markets bar code label printers, software and
related products. Mr. Skinner founded Eltron International, Inc.
in January 1991, and served as Executive Vice President and Chief
Operating Officer before assuming his current positions in December 1992.
</TABLE>
3
<PAGE>
Board Meetings and Committees
The Board of Directors met three times during 1996. All directors attended
all meetings of the Board of Directors and the committees of which the director
was a member during 1996. In addition, all board members participated in two
extended strategic planning meetings in 1996. The standing committees of the
Board of Directors are the Audit Committee, Compensation Committee and
Nominating Committee. In addition to the Board of Directors meetings, the Audit
Committee met twice during 1996 and the Compensation Committee met one time
during 1996.
The Audit Committee makes recommendations concerning the engagement of the
independent public accountants, reviews with the independent public accountants
the plans and results of the audit engagement, approves professional services
provided by the independent public accountants, reviews the independence of the
independent public accountants, considers the range of audit and non-audit fees
and reviews the adequacy of the Company's internal accounting controls. The
Audit Committee consists of Mr. Prentice and Mr. Skinner. The Compensation
Committee determines compensation for the Company's executive officers and
administers the Company's 1995 Stock Incentive Plan. The Compensation Committee
consists of Mr. Prentice and Mr. Skinner. The Nominating Committee recommends
the slate of Board members and consists of Mr. Prentice and Mr. Skinner.
Compensation of Directors
Nonemployee directors are paid $1,000 per quarter, $1,000 per board meeting
attended and $500 for each telephonic board or committee meeting. Each
nonemployee director also is automatically granted an option to purchase 15,000
shares of the Company's Common Stock when the person becomes a director, and is
automatically granted an option to purchase 5,000 additional shares of the
Company's Common Stock in each subsequent calendar year that the director
continues to serve in that capacity.
Recommendation by the Board of Directors
The Board of Directors recommends that shareholders vote for the election
of the nominees named in this Proxy Statement.
4
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth all compensation paid by the Company with
respect to the last three years to the Chief Executive Officer and the one other
executive officer whose total annual compensation exceeded $100,000 in 1996.
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation
----------------------------- ------------------
Securities All Other
Name and Principal Position Year Salary Bonus Underlying Options Compensation(1)
- --------------------------- ---- -------- ------- ------------------ ---------------
<S> <C> <C> <C> <C> <C>
Michael P. Coughlin 1996 $112,981 $14,875 0 $6,393
President and Chief 1995 $100,000 $ 7,207 15,000 $5,360
Executive Officer 1994 $ 84,000 $23,959 0 $6,151
Andy J. Storment 1996 $100,000 $ 8,356 0 $5,418
Executive Vice President 1995 $100,000 $ 7,207 15,000 $5,360
1994 $ 84,000 $23,959 0 $5,885
- -----------------------
(1) Represents the Company's matching contribution under the Company's 401(k)
savings plan.
</TABLE>
5
<PAGE>
Stock Option Grants in Last Fiscal Year
There were no stock options granted in 1996 to the executive officers named
in the Summary Compensation Table.
Option Exercises and Year-End Option Values
The following table indicates for all executive officers named in the
Summary Compensation Table, (i) stock options exercised during 1996, including
the value realized on the date of exercise, (ii) the number of shares subject to
exercisable (vested) and unexercisable (unvested) stock options as of December
31, 1996, and (iii) the value of "in-the-money" options, which represents the
positive spread between the exercise price of existing stock options and the
year-end price of the Common Stock.
<TABLE>
<CAPTION>
Number of
Shares Subject
Number of to Unexercised Value of Unexercised
Shares Options In-the-Money
Acquired Value at Fiscal Year End at Fiscal Year End(1)
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Michael P. Coughlin 6,566 $86,739 6,000 9,000 $18,450 $27,675
Andy J. Storment 6,566 $81,461 6,000 9,000 $18,450 $27,675
- --------------------
(1) Options are "in-the-money" at the fiscal year-end if the fair market value
of the underlying securities on such date exceeds the exercise price of the
option. The amounts set forth represent the difference between the fair
market value of the securities underlying the options on December 31, 1996,
based on the last sale price of $10.50 per share of Common Stock on that
date (as reported on the Nasdaq National Market System) and the exercise
price of the options, multiplied by the applicable number of options.
</TABLE>
Employment Arrangements
Each of the Company's executive officers other than Michael P. Coughlin and
Andy J. Storment has executed an employment agreement with the Company
prohibiting the officer from competing with the Company during the term of
employment and for two years following termination, affirming the Company's
ownership of inventions or other works created by the officer within the scope
of his employment, and limiting disclosure and use of the Company's confidential
information. The agreements permit either the Company or the officer to
terminate employment upon notice, with the notice period ranging from 15 to 30
days. Each of the agreements provides remedies to the Company in the event the
officer breaches his or her obligations. Each officer is eligible to participate
in the Company's standard benefit programs.
6
<PAGE>
INDEPENDENT ACCOUNTANTS
Representatives of Coopers & Lybrand L.L.P. will be present at the Annual
Meeting and will be available to respond to appropriate questions. They do not
plan to make any statement but will have the opportunity to make a statement if
they wish.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers, directors and persons who own more than ten percent of the
Common Stock to file reports of ownership and changes in ownership with the
Securities and Exchange Commission ("SEC"). Executive officers, directors and
beneficial owners of more than ten percent of the Common Stock are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file. Based solely on a review of the copies of such forms received by the
Company and on written representations from certain reporting persons that they
have complied with the relevant filing requirements, the Company believes that
all Section 16(a) filing requirements applicable to its executive officers and
directors have been complied with, except as follows: Mr. Arlen I. Prentice and
Mr. Donald K. Skinner each filed one late report on Form 4.
DISCRETIONARY AUTHORITY
Although the Notice of Annual Meeting of Shareholders provides for
transaction of such other business as may properly come before the meeting, the
Board of Directors has no knowledge of any matters to be presented at the
meeting other than those referred to herein. However, the enclosed proxy gives
discretionary authority to the proxy holders to vote in accordance with the
recommendation of management if any other matters are presented.
SHAREHOLDER PROPOSALS
Any shareholder proposals to be considered for inclusion in proxy material
for the Company's next annual meeting in May 1998 must be received at the
principal executive office of the Company no later than December 19, 1997.
By Order of the Board of Directors
Andy J. Storment
Secretary
Eugene, Oregon
April 14, 1997
7
<PAGE>
PERCON INCORPORATED
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY.
PLEASE SIGN AND RETURN THIS PROXY
The undersigned hereby appoints Michael P. Coughlin and Andy J. Storment, and
each of them, proxies with power of substitution to vote on behalf of the
undersigned all shares that the undersigned may be entitled to vote at the
annual meeting of shareholders of Percon Incorporated (the "Company") on May 23,
1997 and any adjournments thereof, with all powers that the undersigned would
possess if personally present, with respect to the following:
<TABLE>
<CAPTION>
<C> <C> <C> <C>
1. Election of Directors: FOR all nominees except WITHOLD AUTHORITY 2. Transaction of any
as marked to the to vote for all nominees business that properly
(Instructions: To withold authority contrary below. listed below. comes before the meeting
to vote for any individual, strike or any adjournments
a line through the nominee's name ( ) ( ) thereof.
below.) Michael P. Coughlin,
Andy J. Storment, Arlen I. Prentice,
Donald K. Skinner.
</TABLE>
(Continued and to be dated and signed on the other side.)
<PAGE>
PROXY
PERCON INCORPORATED
Annual Meeting, May 23, 1997
PROXY SOLICITED BY BOARD OF DIRECTORS
The shares represented by this proxy will be voted as specified on the reverse
hereof, but if no specification is made, this proxy will be voted for the
election of directors. The proxies may vote in their discretion as to other
matters that may come before this meeting.
Dated _____________________________, 1997
------------------------------------------
Signature or Signatures
Please date and sign as name is imprinted hereon, including designation as
executor, trustee, etc., if applicable. A corporation must sign its name by the
president or other authorized officer.
The Annual Meeting of Shareholders of Percon Incorporated will be held on May
23, 1997 at 9:00 a.m. Pacific Time, at the Valley River Inn, 1000 Valley River
Way, Eugene, Oregon.
Please Note: Any shares of stock of the Company held in the name of fiduciaries,
custodians or brokerage houses for the benefit of their clients may only be
voted by the fiduciary, custodian or brokerage house itself-the beneficial owner
may not directly vote or appoint a proxy to vote the shares and must instruct
the person or entity in whose name the shares are held how to vote the shares
held for the beneficial owner. Therefore, if any shares of stock of the Company
are held "street names" by a brokerage house, only the brokerage house, at the
instructions of its client, may vote or appoint a proxy to vote the shares.
