<PAGE> 1
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
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
MOBINETIX SYSTEMS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
MOBINETIX SYSTEMS, INC.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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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(1) ________________
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(4) Proposed maximum aggregate value of transaction:
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/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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(1) Set forth the amount on which the filing fee is calculated and state how
it was determined.
<PAGE> 2
MOBINETIX SYSTEMS, INC.
Notice of Annual Meeting of Stockholders
To Be Held on December 2, 1996
TO THE STOCKHOLDERS;
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
MobiNetix Systems, Inc., a Delaware corporation (the "Company"), will be held
on December 2, 1996 at 10:00 a.m., local time, at the Company's principal
executive offices, located at 500 Oakmead Parkway, Sunnyvale, California 94806
for the following purposes:
1. To elect three directors to serve until the next Annual Meeting
of Stockholders and until their successors are elected.
2. To ratify the appointment of Arthur Andersen LLP as
independent auditors of the Company for the fiscal year ending June 30, 1997.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on November 12,
1996 are entitled to notice of and to vote at the Annual Meeting and any
adjournment thereof.
All stockholders are cordially invited to attend the Annual Meeting in
person. However, to ensure your representation at the meeting, you are urged
to mark, sign, date and return the enclosed proxy card as promptly as possible
in the postage-prepaid envelope enclosed for that purpose. Any stockholder
attending the Annual Meeting may vote in person even if such shareholder has
returned a proxy.
FOR THE BOARD OF DIRECTORS
Aziz Valliani
President and Chief Executive Officer
Sunnyvale, California
November 15, 1996
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN, DATE AND RETURN
THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE
<PAGE> 3
MOBINETIX SYSTEMS, INC.
PROXY STATEMENT
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed Proxy is solicited on behalf of the Board of Directors of
MobiNetix Systems, Inc., a Delaware corporation (the "Company"), for use at the
Annual Meeting of Stockholders (the "Annual Meeting") to be held December 2,
1996 at 10:00 a.m., local time, or at any adjournment thereof, for the purposes
set forth herein and in the accompanying Notice of Annual Meeting of
Stockholders. The Annual Meeting will be held at the Company's principal
executive offices, located at 500 Oakmead Parkway, Sunnyvale, California 94806.
The telephone number at that location is (408) 524-4200.
These proxy solicitation materials and the Company's Annual Report to
Stockholders for the year ended June 30, 1996, including financial statements,
were mailed on or about November 15, 1996 to all stockholders entitled to vote
at the meeting.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the
person giving it at any time before its use by delivering to the Company
(Attention: David M. Licurse, Sr., Chief Financial Officer and Vice President
of Operations) a written notice of revocation or a duly executed proxy bearing
a later date or by attending the Annual Meeting and voting in person.
VOTING AND SOLICITATION
Each stockholder voting for the election of directors may cumulate
such stockholder's votes and give one candidate a number of votes equal to the
number of directors to be elected multiplied by the number of shares held by
such stockholder, or may distribute such stockholder's votes on the same
principle among as many candidates as the stockholder may select, provided that
votes cannot be cast for more than three directors. However, no stockholder
will be entitled to cumulate votes unless the candidate's name has been placed
in nomination prior to the voting, and the stockholder, or any other
stockholder, has given notice at the meeting prior to the voting of the
intention to cumulate votes. If any stockholder gives such notice, all
stockholders may cumulate their votes for the candidates in nomination. In the
event that cumulative voting is invoked, the proxy holders will have the
discretionary authority to vote all proxies received by them in such a manner
as to ensure the election of as many of the Board of Directors' nominees as
possible. See "Proposal 1--Election of Directors." On all other matters, each
share has one vote.
The Company will bear the cost of soliciting proxies. In addition, the
Company may reimburse brokerage firms and other persons representing beneficial
owners of shares for their
<PAGE> 4
expenses in forwarding solicitation material to such beneficial owners.
Solicitation of proxies by mail may be supplemented by one or more of
telephone, telegram, facsimile or personal solicitation by directors, officers
or regular employees of the Company. No additional compensation will be paid
to such persons for such services.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company which are intended to be
presented by such stockholders at the Company's 1997 Annual Meeting must be
received by the Company no later than August 4, 1997 in order that they may be
included in the proxy statement and form of proxy relating to that meeting.
RECORD DATE AND VOTING SECURITIES
Stockholders of record at the close of business on November 12, 1996
are entitled to notice of and to vote at the meeting. At the record date,
1,336,358 shares of the Company's Common Stock, par value $0.01, were issued
and outstanding, no shares of the Company's Series A Preferred Stock were
outstanding, 898,954 shares of the Company's Series B Preferred Stock were
issued and outstanding and 28,125 shares of the Company's Series C Preferred
Stock were issued and outstanding. Based on the average of the bid and ask
price on the OTC Bulletin Board on November 13, 1996, the market value of one
share of the Company's Common Stock was $4.75. Each share of Common Stock is
entitled to one vote, each share of Series B Preferred Stock is entitled to two
votes, and each share of Series C Preferred Stock is entitled to forty votes.
PROPOSAL 1 -- ELECTION OF DIRECTORS
NOMINEES
The Company's Bylaws currently provide for a board of three directors.
Unless otherwise instructed, the proxy holders will vote the proxies received
by them for the Company's three nominees named below, all of whom are currently
directors of the Company. In the event that 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 substitute nominee who shall be designated by
the current Board of Directors to fill the vacancy. It is not expected that
any nominee listed below will be unable or will decline to serve as a director.
In the event that additional persons are nominated for election as directors,
the proxy holders intend to vote all proxies received by them in such a manner
in accordance with cumulative voting as will ensure the election of as many of
the nominees listed below as possible, and, in such event, the specific
nominees to be voted for will be determined by proxy holders. In any event,
the proxy holders cannot vote for more than three persons. The term of office
of each person elected as a director will continue until the next Annual
Meeting of Stockholders or until his successor has been elected and qualified.
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<PAGE> 5
f The names of the nominees, and certain information about them, are set
forth below.
<TABLE>
<CAPTION>
Name Of Nominee Age Principal Occupation Director Since
--------------- --- -------------------- --------------
<S> <C> <C> <C>
Paul C. Dali 53 Chairman of the Board of the Company; 1992
General Partner of Nazem & Company
Aziz Valliani 42 President and CEO of the Company 1996
Nazim Kareemi 48 Executive Vice President of the 1992
Company
</TABLE>
There are no family relationships among the Company's directors and
executive officers.
BUSINESS EXPERIENCE OF THE NOMINEES
PAUL DALI is the Chairman of the Company's Board. Paul is a General
Partner of Nazem & Company responsible for managing the firm's California
office. Prior to joining Nazem and Company in 1991, he was a General Partner
with the venture capital firm of 3i Ventures from 1988 until 1991. Before
joining 3i, Mr. Dali served as President and CEO of Regis McKenna Inc. from
1983 until 1988, one of the largest and most well-known electronics industry
marketing and communications firms in the U.S. Prior to joining Regis McKenna,
Mr. Dali was the General Manager of the Personal Computer Systems Division at
Apple where he was responsible for all phases of the Apple II and Apple III
product lines. Mr. Dali received a B.S. degree from the University of
California at Northridge. Mr. Dali has been a director of the Company since
May, 1992. Mr. Dali is also a director of Cybermedia, Inc. and Graphixzone,
Inc.
AZIZ VALLIANI is the President and CEO of the Company and one of its
directors. Mr. Valliani, a 19 year veteran in the industry, served as
President and CEO of Inforite Corporation, before joining the Company in
January 1996. Prior to Inforite, Mr. Valliani was COO and executive vice
president at Wyse Technology. Before Wyse, Mr. Valliani served as Vice
President and General Manager for the Altos business unit of Acer America
Corporation. Mr. Valliani was with Intel before joining Altos Computer Systems
and earned his BSEE from Pratt Institute, Brooklyn, NY. Mr. Valliani has been
a director of the Company since January, 1996.
NAZIM KAREEMI is the Executive Vice President of the Company, and
previously served as President of the Company. Mr. Kareemi also founded
PenWare, the predecessor of the Company. Mr. Kareemi has more than twenty
years of experience in computer industry. Mr. Kareemi worked with or
consulted for leading technology and computer companies including Intel, Zilog
and Xerox. He has a B.S. from MIT and M.S. and Engineer's degrees from
Stanford University. Mr. Kareemi has been a director of the Company since May
1992.
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<PAGE> 6
VOTE REQUIRED AND RECOMMEND OF BOARD OF DIRECTORS
The nominees receiving the highest number of affirmative votes of the
shares entitled to be voted, up to the number of directors to be elected, shall
be elected as directors. Votes withheld will be counted for purposes of
determining the presence or absence of a quorum for the transaction of business
at the meeting, but have no other legal effect upon election of directors under
California law.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS VOTING "FOR"
THE NOMINEES SET FORTH HEREIN.
PROPOSAL TWO -- RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has selected Arthur Andersen LLP, independent
auditors, to audit the financial statements of the Company for the year ending
June 30, 1997, and recommends that the stockholders vote for ratification of
such appointment. In the event of a negative vote on such ratification, the
Board of Directors will reconsider its selection. Arthur Andersen LLP has
audited the Company's financial statements since the fiscal year ended June 30,
1994. Representatives of Arthur Andersen LLP are expected to be present at the
Annual Meeting of Stockholders and will have the opportunity to make a
statement if they so desire. The representatives also are expected to be
available to respond to appropriate questions from stockholders.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS VOTING "FOR"
THE RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE COMPANY'S
INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING JUNE 30, 1997.
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<PAGE> 7
OTHER INFORMATION
REGARDING SECURITY OWNERSHIP,
DIRECTORS AND OFFICERS
EXECUTIVE OFFICERS
The following table lists the Company's executive officers as of the date of
this Proxy Statement and certain information concerning them.
<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Aziz Valliani . . . . . . . . . . . . 42 President, Chief Executive Officer and Director
Nazim Kareemi . . . . . . . . . . . . 48 Executive Vice President and Director
David M. Licurse . . . . . . . . . . 58 Chief Financial Officer and Vice President of Operations
Llavanya Fernando . . . . . . . . . . 44 Vice President, Hardware Development
Thomas A. Dorosewicz . . . . . . . . 41 Vice President, Sales and Marketing
Abbas Rafii . . . . . . . . . . . . . 49 Vice President, Software Development
</TABLE>
EXECUTIVE PROFILES
AZIZ VALLIANI is the President and CEO of the Company and one of its
directors. Mr. Valliani, a 19 year veteran in the industry, served as
President and CEO of Inforite Corporation, before joining the Company in
January 1996. Prior to Inforite, Mr. Valliani was COO and executive vice
president at Wyse Technology. Before Wyse, Mr. Valliani served as Vice
President and General Manager for the Altos business unit of Acer America
Corporation. Mr. Valliani was with Intel before joining Altos Computer Systems
and earned his BSEE from Pratt Institute, Brooklyn, NY. Mr. Valliani has been
a director of the Company since January, 1996
NAZIM KAREEMI is the Executive Vice President of the Company, and
previously served as President of the Company. Mr. Kareemi also founded
PenWare, the predecessor of the Company. Mr. Kareemi has more than twenty
years of experience in computer industry. Mr. Kareemi worked with or
consulted for leading technology and computer companies including Intel, Zilog
and Xerox. He has a B.S. from MIT and M.S. and Engineer's degrees from
Stanford University. Mr. Kareemi has been a director of the Company since May
1992.
DAVID M. LICURSE is the CFO and Vice President of Operations. Before
joining the Company, he served as CFO and Vice President of Operations at
Inforite Corporation. Mr. Licurse held various senior level managerial
positions with Xerox Corporation from 1972 until 1994. These positions ranged
from Financial Planning and Analysis Manager for Xerox's $1 billion
manufacturing division and Controller for a $350 million personal computer
business unit to Manager of Finance and Operations for a $60 million high
technology software division in Palo Alto. Mr. Licurse earned an MBA from
University of Rochester.
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<PAGE> 8
LLAVANYA FERNANDO is the Vice President of Hardware Development. Mr.
Fernando served as vice president of R & D at Inforite Corporation. Mr.
Fernando has over 21 years of direct R&D, mobile computing and management
experience. From 1993 until 1995, he held a senior management position at
Wyse. From 1982 until 1993, Mr. Fernando was the General Manager at a business
unit of TeleSensory Systems, Inc. in Mountain View, California. He has also
worked at Data Products, Graviner Ltd. and H. Tinsley & Co. Qualified in
England, he obtained M.S. and B.S. degrees in the field of electronics and
systems engineering.
ABBAS RAFII is the Vice President of Software Development. At PenWare
he managed the development and release of five commercial software products.
Before joining the Company, he was project lead and a senior software engineer
at Hewlett-Packard Laboratories from 1979 until 1992. He has more than fifteen
years of experience in design and development of applications, operating
systems components, and object oriented database systems. His credentials
include an M.S. and a Ph.D. degree from Stanford University.
THOMAS A. DOROSEWICZ is the Vice President of Sales and Marketing.
Mr. Dorosewicz, who joined the Company in August 1996, has spent the last 15
years in sales and marketing positions within the data capture field. Prior to
joining the Company, Mr. Dorosewicz ran the New England Division of Symbol
Technologies from 1994 until 1996. Mr. Dorosewicz's earlier positions included
head of the Business development activities at Symbol from 1990 until 1994 and
Business Unit Director for Scanning at Fujitsu Systems of America from 1987
until 1990.
None of the directors or officers of the Company have been
involved in any proceedings described in Item 401(d) of Regulation S-B
promulgated under the Exchange Act of 1934, as amended.
SECURITY OWNERSHIP
The following table sets forth certain information known to the
Company regarding the beneficial ownership of the Company's Common Stock as of
November 13, 1996, by (a) each beneficial owner of more than 5% of the
Company's Common Stock, (b) the Named Officers, (c) each director of the
Company and (d) all directors and executive officers of the Company as a group.
Except as otherwise indicated, each person has sole voting and investment power
with respect to all shares shown as beneficially owned, subject to community
property laws where applicable.
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<PAGE> 9
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of
Title of Class Beneficial Owner Beneficial Ownership Percent of Class
-------------- ------------------- -------------------- ----------------
<S> <C> <C> <C>
Series B Preferred Life Investors Insurance 352,942 shares 39.3%
Stock* Company of America directly owned
Common Stock Aziz Valliani 253,683 19.0%
MobiNetix Systems, Inc.
500 Oakmead Parkway
Sunnyvale, CA 94086
Common Stock Nazim Kareemi 253,683 19.0%
MobiNetix Systems, Inc.
500 Oakmead Parkway
Sunnyvale, CA 94086
Series C Preferred Paul C. Dali 28,125** 100%
Stock* Nazem & Company
3000 Sand Hill Road
Building 2, Suite 205
Menlo Park, CA 94025
Common Stock and All Directors and Officers 1,033,045 45.6% of the aggregate
Series C Preferred as a group of the Common Stock and
Stock the Series C Preferred
</TABLE>
* The Company effected a reverse stock split, converting each share of
Series B Preferred into one-half share and increasing the conversion ratio of
Series B Preferred into Common Stock from 1:1 to 1:2 and converting each share
of Series C Preferred into one-fourth share and increasing the conversion ratio
of Series C Preferred into Common Stock from 1:10 to 1:40.
** Mr. Dali is a general partner of Nazem & Associates IV, L.P., the General
Partner of Nazem & Company IV, L.P., which is the owner of record of the Series
C Preferred. Mr. Dali disclaims beneficial ownership of such Series C
Preferred.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of six meetings
during the fiscal year ended June 30, 1996. No director attended fewer than
75% of the meetings of the Board of Directors and its committees upon which
such director served. The Board of Directors has no committees. The Board of
Directors has no nominating, audit or compensation committees or any committee
performing similar functions.
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<PAGE> 10
DIRECTOR COMPENSATION
The Company currently does not pay any annual retainer, per-meeting
fee, or any other compensation to any director.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's executive officers and directors, and persons who own
more than ten percent of a registered class of the Company's equity securities,
to file reports of ownership on Form 3 and changes in ownership on Forms 4 or 5
with the Securities and Exchange Commission. Such executive officers,
directors and 10% stockholders are also required by the Securities and Exchange
Commission rules to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely upon its review of copies of such forms received by it,
or written representations from certain reporting persons that no filings were
required for such persons, the Company believes that during the year ended June
30, 1996, Paul Dali, Aziz Valliani, Nazim Kareemi, Llavanya Fernando, David
Licurse, Sr. and Abbas Rafii, failed to report initial statements of beneficial
ownership on Form 3 in a timely manner.
EXECUTIVE COMPENSATION
The following table sets forth all compensation received for services
rendered to the Company in all capacities, for the last three fiscal years
ended June 30, 1996, by the Named Officers, as named below:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Underlying All Other
Name and Principal Position Year Salary Bonus Options Compensation
--------------------------- ---- ------ ----- ---------- ------------
<S> <C> <C> <C> <C> <C>
Aziz Valliani 1996 $124,042 --- --- ---
President and Chief 1995 0 --- --- ---
Executive Officer 1994 0 --- --- ---
Nazim Kareemi 1996 $136,101 --- --- ---
Executive Vice President 1995 107,756 --- --- ---
1994 103,398 --- --- ---
</TABLE>
The Company has not entered into any employment contracts with any Named
Officer.
OPTION GRANTS IN LAST FISCAL YEAR
-8-
<PAGE> 11
The Company has not granted any options to purchase securities of the
Company to any Named Officer.
OPTION EXERCISES AND HOLDINGS
There have been no option exercises by any Named Officers in the last
fiscal year. The Named Officers have no unexercised options as of June 30,
1996.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
None of the Named Officers has exercised any options to purchase
securities of the Company.
OTHER MATTERS
The Company knows of no other matters to be submitted to the meeting.
If any other matters properly come before the meeting or any adjournment or
postponement thereof, it is the intention of the persons named in the enclosed
form of Proxy to vote the shares they represent as the Board of Directors may
recommend.
FORM 10-K
STOCKHOLDERS ENTITLED TO VOTE AT THE ANNUAL MEETING MAY
OBTAIN, WITHOUT CHARGE, A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB
FOR THE FISCAL YEAR ENDED JUNE 30, 1996 UPON WRITTEN REQUEST TO DAVID M.
LICURSE, SR., CHIEF FINANCIAL OFFICER AND VICE PRESIDENT OF OPERATIONS,
MOBINETIX SYSTEMS, INC., 500 OAKMEAD PARKWAY, SUNNYVALE, CALIFORNIA 94086.
BY ORDER OF THE BOARD OF DIRECTORS
Dated: November 15, 1996
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<PAGE> 12
(Continued from other side)
1. ELECTION OF DIRECTORS:
NOMINEES: Paul C. Dali, Aziz Valliani and Nazim Kareemi
[ ] FOR [ ] WITHHELD
[ ] ______________________________________
For all nominees except as noted above
2. Proposal to confirm the appointment of Arthur Andersen, L.L.P. as the
Company's independent auditors for the 1997 fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, upon such other business as may properly come
before the meeting or any adjournment thereof.
This Proxy will be voted as directed or, if no contrary direction is
indicated, will be voted FOR the election of the nominees indicated above, FOR
ratification of the appointment of Arthur Andersen, L.L.P., and in the
discretion of the proxyholders, on such other business as may properly come
before the meeting or any adjournment thereof.
(This Proxy should be marked, dated and signed by the stockholder(s) exactly as
his or her name appears hereon, and returned promptly in the enclosed envelope.
Persons signing as officers or in a fiduciary capacity should so indicate. If
shares are held by joint tenants or as community property, both should sign.)
Signature ____________________ Date _________
Signature ____________________ Date _________
[ ] CHECK HERE FOR ADDRESS CHANGE
[ ] CHECK HERE IF YOU PLAN TO ATTEND THE ANNUAL MEETING
<PAGE> 13
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
MOBINETIX SYSTEMS, INC.
ANNUAL MEETING OF STOCKHOLDERS
The undersigned stockholder of MobiNetix Systems, Inc., a Delaware
corporation (the "Company"), hereby appoints Aziz Valliani and Nazim Kareemi,
and each of them, with full power of substitution to represent the undersigned
and to vote all the shares of the Company which the undersigned is entitled to
vote, at the Annual Meeting of Stockholders of the Company to be held on
December 2, 1996, at 10:00 a.m., local time, at 500 Oakmead Parkway, Sunnyvale,
California 94086, or any adjournment thereof (1) as hereinafter specified upon
the proposals listed on the reverse side and as more particularly described in
Company's Proxy Statement, receipt of which is hereby acknowledged, and (2) in
their discretion upon such other matters as may properly come before the
meeting.
(Continued, and to be signed, on reverse side).
