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
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
DAKTRONICS, INC.
- --------------------------------------------------------------------------------
(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] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (Set forth the amount on which the
filing fee is calculated and state how it was determined.)
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing party:
(4) Date filed:
DAKTRONICS, INC.
331 32ND AVENUE
BROOKINGS, SOUTH DAKOTA 57006
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
AUGUST 20, 1997
TO THE SHAREHOLDERS OF DAKTRONICS, INC.:
Notice is hereby given that the Annual Meeting of Shareholders of Daktronics,
Inc. ("Daktronics" or the "Company") will be held on Wednesday, August 20, 1997,
at Daktronics, Inc., 331 32nd Avenue, Brookings, South Dakota at 7:00 p.m.
Central Daylight Time, for the following purposes:
1. To elect three directors as members of the class of directors
to serve until the third succeeding Annual Meeting of
Shareholders, and until their successors have been elected and
qualified.
2. To ratify the appointment of McGladrey & Pullen, LLP as
independent auditors for the Company for the fiscal year
ending May 2, 1998.
3. To consider and act upon any other matters that may properly
come before the meeting or any adjournment thereof.
Only the shareholders of record of Daktronics Common Stock at the close of
business on July 18, 1997, will be entitled to receive notice of and to vote at
the meeting or any adjournment thereof.
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING. WHETHER OR NOT YOU PLAN TO BE
PERSONALLY PRESENT AT THE MEETING, PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED
PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE. IF YOU LATER DESIRE TO
REVOKE YOUR PROXY, YOU MAY DO SO AT ANY TIME BEFORE IT IS EXERCISED.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Duane E. Sander
Duane E. Sander,
Secretary
July 25, 1997
DAKTRONICS, INC.
331 32ND AVENUE
BROOKINGS, SOUTH DAKOTA 57006
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
AUGUST 20, 1997
This Proxy Statement is furnished in connection with the solicitation of the
enclosed proxy by the Board of Directors of Daktronics, Inc. ("Daktronics" or
the "Company") for use at the Annual Meeting of Shareholders to be held on
Wednesday, August 20, 1997, at Daktronics, Inc., 331 32nd Avenue, Brookings,
South Dakota at 7:00 p.m. Central Daylight Time, and at any adjournment thereof,
for the purposes set forth in the Notice of Annual Meeting of Shareholders.
Shares of Common Stock represented by proxies in the form solicited will be
voted in the manner directed by a shareholder. If no direction is made, the
proxy will be voted (a) for the election of the three nominees for director
named in this Proxy Statement and (b) for the ratification of the appointment of
McGladrey & Pullen, LLP as independent auditors for the Company for the fiscal
year ending May 2, 1998. A shareholder may revoke his or her proxy at any time
before it is voted by delivering to the Secretary of the Company a written
notice of termination of the proxy's authority, by filing with the Secretary of
the Company another proxy bearing a later date, or by appearing and voting at
the meeting. This Proxy Statement and the form of proxy enclosed are being
mailed to shareholders commencing on or about July 25, 1997.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by the
inspectors of election appointed by the Company for the meeting, and the number
of shareholders present in person or by proxy will determine whether or not a
quorum is present. The inspectors of election will treat abstentions as shares
that are present and entitled to vote for purposes of determining the presence
of a quorum for all matters. Shares abstaining will be treated as unvoted. If a
broker indicates on the proxy that it does not have discretionary authority as
to certain shares to vote on a particular matter, those shares will not be
considered as present and entitled to vote by the inspectors of election with
respect to that matter. The three persons receiving the most votes will be
elected for directors and the ratification for the appointment of the auditors
will be determined by a majority of the votes cast.
Only the holders of the Company's Common Stock whose names appear of record on
the Company's books at the close of business on July 18, 1997, will be entitled
to vote at the annual meeting. At the close of business on July 18, 1997, a
total of 4,306,420 shares of Common Stock were outstanding. The holders of
one-third of the shares of Common Stock issued and outstanding and entitled to
vote at the 1997 Annual Meeting, present in person or represented by proxy, will
constitute a quorum for the transaction of business. If a quorum should not be
present, the 1997 Annual Meeting may be adjourned from time to time until a
quorum is present. Holders of Common Stock are entitled to one vote per share on
all matters submitted to a vote of shareholders, except that with respect to the
election for directors every shareholder shall have the right to vote, in person
or by proxy, the number of shares owned by the holder for as many persons as
there are directors to be elected, or to cumulate the holder's votes by giving
one candidate the number of votes which is equal to the number of directors to
be elected multiplied by the number of the holder's shares, or by distributing
such cumulated votes among any number of candidates.
Participants in the Company's Employee Stock Ownership Plan (ESOP) are entitled
to instruct the trustee of the ESOP how to vote all shares of Common Stock
allocated to participants' accounts under the ESOP. Each participant will
receive a voting instruction card to direct the trustee to vote that
participant's allocated shares. If a participant does not timely return a
completed voting instruction card, the trustee will vote the shares allocated to
that participant in the same proportion as the shares which are voted by all
participants under the ESOP. The trustee of the ESOP will vote any unallocated
shares of Common Stock held by the ESOP in the same proportion as the shares
allocated to the participants' accounts.
Participants in the Company's 401k plan who have Daktronics shares as one of
their 401k selections are entitled to instruct the trustee of the 401k plan how
to vote their shares of Common Stock. Each participant will receive a voting
instruction card to direct the trustee to vote that participant's shares. If a
participant does not timely return a completed voting instruction card, the
trustee will vote the shares allocated to that participant in the same
proportion as the shares which are voted by all participants under the 401k
plan.
Expenses in connection with the solicitation of proxies will be paid by the
Company. Proxies are being solicited primarily by mail, but, in addition,
officers and regular employees of the Company who will receive no extra
compensation for their services may solicit proxies by telephone, telecopier or
personal calls. The Company may reimburse brokerage firms and others for their
expenses in forwarding solicitation materials to the beneficial owners of Common
Stock.
A copy of the Company's Annual Report for the fiscal year ended May 3, 1997 is
being furnished to each shareholder with this Proxy Statement.
ELECTION OF DIRECTORS
Pursuant to the Company's Articles of Incorporation, the Board of directors
is divided into three classes serving staggered three-year terms expiring at
each successive annual meeting of shareholders. The terms of Frank J.
Kurtenbach, Wayne W. Waltz and Roland J. Jensen expire at the 1997 Annual
Meeting; James B. Morgan, John L. Mulligan, and Duane E. Sander expire at the
1998 Annual Meeting, and Aelred J. Kurtenbach, Charles S. Roberts, and Edwin
M. Theisen expire at the 1999 Annual Meeting.
The persons named in the accompanying proxy will vote for the election of the
three nominees described herein, unless authority to vote is withheld. The Board
of Directors has been informed that each of the three nominees is willing to
serve as a director; however, if any nominee should decline or become unable to
serve as a director for any reason, the proxy may be voted for such other person
as the proxies shall, in their discretion, determine.
The following table sets forth certain information as of July, 15 1997
concerning the three nominees for election as directors of the Company and the
continuing directors:
NAME AND AGE POSITION WITH COMPANY
- ------------ ---------------------
NOMINEES FOR TERMS EXPIRING AT THE 1997 ANNUAL MEETING
Frank J. Kurtenbach (59) Vice President, Sales and Director
Roland J. Jensen (67) Director
James A.Vellenga (62) Director Nominee
DIRECTORS FOR TERMS EXPIRING AT THE 1998 ANNUAL MEETING
James B. Morgan (50) Vice President, Engineering and Director
Duane E. Sander (59) Secretary and Director
John L. Mulligan (58) Director
DIRECTORS FOR TERMS EXPIRING AT THE 1999 ANNUAL MEETING
Aelred J. Kurtenbach (63) President and Director
Charles S. Roberts (72) Director
Edwin M. Theisen (66) Director
FRANK J. KURTENBACH joined the Company in 1979 as Sales Manager of the
Standard Scoreboard Division, which was expanded to include other products in
1981. He has served as Sales Manager for the Company since 1982, as a
director since 1984 and as Vice President, Sales since November 1993. Mr.
Kurtenbach has a M.S. degree from South Dakota State University. Aelred
Kurtenbach and Frank Kurtenbach are brothers.
ROLAND J. JENSEN worked in various capacities from 1960 to 1990 with Northern
States Power Company, an electric and natural gas utility, ending his service as
Senior Vice President of Power Supply. From 1990 to his retirement in January
1994, he was Chairman and CEO of NRG Energy, Inc., a Minneapolis-based energy
services company. Mr. Jensen has served as a director of the Company since 1994.
JAMES A. VELLENGA will serve as a director of the Company starting August
1997, pending approval by shareholders. Since 1988, Mr. Vellenga has been VP
of Operations responsible for Product Development, Manufacturing and Quality
Assurance at Aetrium, Inc in St. Paul, MN. He was previously a founding
officer of Lee Data Corp, and prior to that he was one of the early employees
at Data 100 Corp until its acquisition by Northern Telecom. Mr. Vellenga
holds a B.S. degree in Electrical Engineering from South Dakota State
University.
JAMES B. MORGAN joined the Company in 1969 as a part-time engineer while
earning his M.S. degree in Electrical Engineering from South Dakota State
University. Since 1970, he has been employed by the Company as its
Engineering Manager and since 1975 as its Vice President, Engineering, with
responsibility for product development, contract design, project management
for customer contracts, and corporate information and scheduling systems. In
1995, Mr. Morgan was named Executive Vice President. Mr. Morgan has served as
a director since 1984.
DUANE E. SANDER, PH.D. is a co-founder of the Company and has served as a
director and as Secretary of the Company since its incorporation. Dr. Sander
is currently employed as Dean of Engineering at South Dakota State University
where he has taught electrical engineering courses and directed biomedical
research projects since 1967.
JOHN L. MULLIGAN was elected as a director of the Company in 1993. He currently
is employed as a financial services specialist with Mesirow Financial, in the
same capacity as when he was employed there from late 1990 through mid 1993. In
1993 and 1994, he served as principal of Mulligan Financial, a financial
services firm which he founded. From 1967 to March 1990, he served as President,
Chairman, Chief Executive Officer and director of American Western Corporation.
AELRED J. KURTENBACH, PH.D. is a co-founder of the Company and has served as
a director and as President of the Company since its incorporation. Dr.
Kurtenbach also served as Treasurer until 1993. Dr. Kurtenbach has over 40
years of experience in the fields of communication engineering and control
system design, technical services, computer systems, electrical engineering
education and business management. Dr. Kurtenbach has B.S., M.S. and Ph.D.
degrees in Electrical Engineering from South Dakota School of Mines and
Technology, the University of Nebraska and Purdue University, respectively.
CHARLES S. ROBERTS, M.D. has served as a director of the Company since 1968.
Prior to his retirement in 1991, Dr. Roberts was engaged in family practice
and internal medicine at the Brookings Clinic, Brookings, South Dakota.
EDWIN M. THEISEN has served as a director of the Company since August 1996.
Mr. Theisen is currently the principal of Theisen Consulting Services in
Plymouth, Minnesota. Mr. Theisen was President and Chief Operating Officer of
Northern States Power company from 1990 until 1994, after holding various
other positions with the company since 1954. He received a bachelor of arts
degree in accounting from St. John's University, Collegeville, MN, and served
as a first lieutenant in the U.S. Marine Corps from 1952 to 1954.
DIRECTOR COMPENSATION
The current nonemployee directors of the Company include Messrs. Mulligan,
Sander, Roberts, Waltz, Jensen, and Theisen. Mr. Vellenga, a director nominee is
not an employee. Each nonemployee director receives, for their services as a
director, a $500 retainer each year, $500 for each meeting attended in person,
$250 for telephone Board meetings, $250 for each committee meeting attended in
person and reimbursement of all out-of-pocket expenses incurred in attending
meetings. The nonemployee directors also receive stock options under the
Company's 1993 Outside Directors Stock Option Plan. In August 1996, Mr. Theisen
and Dr. Roberts each received 3,000 shares under the 1993 Outside Directors
Stock Option Plan, which are subject to vesting restrictions under the plan and
have an exercise price of $4.875 per share. Dr. Sander does not receive any
additional compensation for serving as Secretary of the Company.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of the Company has an Audit Committee consisting of John
Mulligan (chair), and Wayne W. Waltz; and a Compensation Committee consisting of
Roland Jensen (chair), Charles S. Roberts, and John Mulligan. The Company has no
standing nominating committee. The Board as a whole performs the functions which
would otherwise be delegated to a nominating committee.
The Board of Directors held 4 meetings during fiscal 1997. All incumbent
directors attended at least 75% of the meetings of the Board meetings. The Board
also passed several resolutions during fiscal 1997 by written consent.
The Audit Committee held one meeting in Fiscal 1997. The Audit Committee reviews
the activities of the Company's independent accountants and the results of
audits made by these professionals.
The Compensation Committee held two meeting during fiscal 1997. The Compensation
Committee (the "Committee") is responsible for making recommendations to the
Board of Directors regarding compensation of the Company's executive officers
and stock option awards under the Company's 1993 Stock Option Plan. None of the
members of the Committee are employees of the Company and all executive officers
who serve on the Board of Directors abstain from voting on compensation
affecting those executive officers who are Board members.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION Roland Jensen
(chair), Charles S. Roberts and John L. Mulligan served as the members of the
Compensation Committee during Fiscal 1997. There are no compensation committee
interlocks with other companies and none of the members of the committee has
been an officer, employee or insider of the Company or its subsidiaries.
EXECUTIVE COMPENSATION
CASH AND OTHER COMPENSATION
The following table sets forth the cash and noncash compensation for each of the
last three fiscal years awarded to or earned by the Company's Chief Executive
Officer, and each of the other executive officers, whose total annual salary and
bonus exceeded $100,000 during fiscal 1997.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
-----------
FISCAL ANNUAL COMPENSATION(1) SECURITIES
YEAR ---------------------- ALL OTHER UNDERLYING
NAME AND PRINCIPAL POSITION ENDED SALARY BONUS(2) COMPENSATION($) OPTIONS (#)
- --------------------------- ----- ------ -------- --------------- -----------
<S> <C> <C> <C> <C> <C>
Dr. Aelred J. Kurtenbach 1997 $150,035 $0 $2,210(3) 4,000
President and Director 1996 146,996 0 1,125(3) 10,000
(Chief Executive Officer) 1995 142,381 0 2,560(3) 8,000
James B. Morgan 1997 $124,708 $0 $1,791(4) 5,000
Executive Vice President 1996 121,762 0 1,029(4) 8,000
and Director 1995 118,741 0 2,699(4) 8,000
Paul J. Weinand 1997 $108,340 $0 $1,625(5) 4,000
Treasurer and 1996 106,473 0 900(5) 8,000
Chief Financial Officer 1995 103,494 0 2,410(5) 8,000
</TABLE>
(1) Annual Compensation excludes personal benefits received by the named
person to the extent that the aggregate amounts thereof were less than
10% of the total of that person's annual salary and bonus.
(2) Reflects bonus earned during the fiscal year.
(3) Includes the following respective contributions under the Company's
401(k) retirement and Savings Plan and the Company's ESOP: fiscal 1997,
$2,210 and $0, fiscal 1996, $1125 and $0; fiscal 1995 $325 and $2,235.
(4) Includes the following respective contributions under the Company's
401(k) retirement and Savings Plan and the Company's ESOP: : fiscal
1997, $1,791 and $0, fiscal 1996, $1,029 and $0; fiscal 1995 $954 and
$1,745.
(5) Includes the following respective contributions under the Company's
401(k) retirement and Savings Plan and the Company's ESOP: : fiscal
1997, $1,625 and $0, fiscal 1996, $900 and $0; fiscal 1995 $852 and
$1,558.
STOCK OPTIONS AND STOCK APPRECIATION RIGHTS
The following table sets forth information relating to stock options and stock
appreciation rights (SARs) awarded to the executive officers named in the
Summary Compensation Table under the Company's 1993 Stock Option Plan during
fiscal 1997. No SARs have been awarded by the Company.
OPTION/SAR GRANTS IN FISCAL 1997
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
----------------------------- VALUE AT ASSUMED
ANNUAL RATES OF
NUMBER OF % OF TOTAL STOCK PRICE
SECURITIES OPTIONS/SARS APPRECIATION
UNDERLYING GRANTED TO EXERCISE OR FOR OPTION TERM
OPTIONS/SARS EMPLOYEES BASE PRICE EXPIRATION -------------------
NAME GRANTED (#) IN 1997 ($/SHARE) DATE 5% 10%
---- ----------- ------- --------- ---- -- ---
<S> <C> <C> <C> <C> <C> <C>
Dr. Aelred J. Kurtenbach 4,000(1) 9.7% $4.6063 11/13/2001 $ 5,090 $11,249
James B. Morgan 5,000(2) 12.1% $4.1875 11/13/2006 $13,167 $33,369
Paul J. Weinand 4,000(3) 9.7% $4.1875 11/13/2006 $10,534 $26,695
</TABLE>
(1) The options were granted under the 1993 Stock Option Plan and become
first exercisable as follows: 800 on November 14, 1997, 800 on November
14, 1998, 800 on November 14, 1999, 1,600 on November 14, 2000.
(2) The options were granted under the 1993 Stock Option Plan and become
first exercisable as follows: 1,000 on November 14, 1997, 1,000 on
November 14, 1998, 1,000 on November 14, 1999, 1,000 on November 14,
2000, and 1,000 on November 14, 2001.
(3) The options were granted under the 1993 Stock Option Plan and become
first exercisable as follows: 800 on November 14, 1997, 800 on November
14, 1998, 800 on November 14, 1999, 800 on November 14, 2000, and 800
on November 14, 2001.
OPTION/SAR EXERCISE AND HOLDINGS
The following table sets forth information relating to unexercised options held
as of May 3, 1997 by the executive officers named in the Summary Compensation
Table. No stock options granted under the Daktronics, Inc. 1993 Stock Option
Plan were exercised in fiscal 1997.
AGGREGATED OPTION/SAR EXERCISES IN FISCAL 1997
AND OPTION/SAR VALUES AT MAY 3, 1997
<TABLE>
<CAPTION>
NUMBER OF
UNEXERCISED VALUE OF
SECURITIES UNEXERCISED
UNDERLYING IN-THE MONEY
OPTIONS/SARS OPTIONS/SARS
SHARES AT 5/03/97(#) AT 5/03/97($)
ACQUIRED VALUE ----------------------------- -----------------------------
NAME ON EXERCISE (#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Dr. Aelred J. Kurtenbach 0 0 14,200 22,800 $0 $0
James B. Morgan(1) 0 0 12,000 21,000 0 0
Paul J. Weinand 0 0 10,800 19,200 0 0
</TABLE>
(1) Does not include options for the purchase of 12,830 shares of Common
stock granted in 1994 in consideration of personal guarantees of
performance bonds issued to the Company. These options have an exercise
price of $3.30 per share and expire in May 1998.
PERFORMANCE GRAPH
The following graph illustrates a comparison of cumulative total returns for
the Company vs. the NASDAQ Market Index and the Media General Industry Group
Index (MG Group Index) from the date of the Company's initial public offering
on February 10, 1994 to May 3, 1997. The graph assumes a $100 initial
investment.
[LINE GRAPH]
2/10/94 4/30/94 4/29/95 4/27/96 5/03/97
------- ------- ------- ------- -------
Daktronics, Inc. $100.00 $114.83 $ 50.89 $ 54.16 $ 52.46
NASDAQ Market Index $100.00 $ 97.79 $131.02 $157.63 $210.35
MG Group Index $100.00 $ 95.48 $104.26 $145.53 $155.13
REPORT OF THE COMPENSATION COMMITTEE
CASH COMPENSATION
DETERMINATION OF BASE SALARY. The Company's compensation philosophy is to
target executive salaries close to the median market rate paid for comparable
positions within the Midwest region for similar size companies.
The Compensation Committee reviewed base salaries for executive officers in
October 1996. Company fiscal 1996 performance was also considered. Based upon
this review, the Committee approved adjusting the base salary of Aelred
Kurtenbach 3% and the base salaries of the other executive officers a total of
3%. Salaries are reviewed annually.
DETERMINATION OF BONUS. For fiscal 1996, the Committee chose to continue with
a discretionary rather than a numeric bonus plan. In October 1996, the
Committee considered the Company's fiscal 1996 performance and awarded no
bonuses.
EQUITY BASED COMPENSATION
In November 1993, the Board of Directors of the Company adopted the Daktronics,
Inc. 1993 Stock Option Plan (the "Option Plan") which was approved by the
shareholders in December 1993. The Committee determines awards under this plan
for executive officers and approves awards for other employees based upon the
recommendation of the Company's executive officers. In November 1996, the
Committee awarded the four executive officers options to purchase a total of
17,000 shares of Common Stock. In addition, the Committee approved the grant of
options to purchase a total of 24,000 shares of Common Stock to 63 non-executive
officer employees.
The exercise price per share of these options was established as the average
between the closing bid and asked price quotations for the Common Stock as
reported by the National Association of Securities Dealers Automatic Quotation
System (NASDAQ) on November 14, 1996, which was $4.1875 Subject to accelerated
vesting upon "change in control" of the Company as defined in the Option Plan,
the outstanding options generally vest 20% each year commencing November 14,
1997.
The Committee's basis for these awards was the Company's performance, as
measured in increased net sales and results of operations, over the last three
years and review of awards by the comparable companies. The number of options
granted to the executive officers, including the Chief Executive Officer, was
less than the average of the comparable companies for similar positions. The
terms of these options, including duration, vesting, and exercise price were
similar to that of the comparable companies.
COMPENSATION OF CHIEF EXECUTIVE OFFICER
The Committee determined the Chief Executive Officer's compensation in the same
manner described above for all executive officers of the Company.
BASE SALARY. The Committee recommended Dr. Kurtenbach's salary be increased
3% to $152,340, commencing October 25, 1996.
DETERMINATION OF BONUS. Based upon the discussion described above the Committee
recommended no bonus for Dr. Kurtenbach in fiscal 1997.
EQUITY BASED COMPENSATION. The Committee awarded to Dr. Kurtenbach options to
purchase 4,000 shares of Company Stock at an exercise price of $4.6063. The
award was made at the same time as the awards to other employees under the
Option Plan.
COMPENSATION COMMITTEE
Roland J. Jensen
Charles S. Roberts
John L. Mulligan
CERTAIN TRANSACTIONS
During fiscal 1997 the Company retained Waltz Construction, Inc., a commercial
construction company based in Brookings, South Dakota, to build a 10,180
square foot addition to the Company's manufacturing plant. The Company paid
Waltz Construction, Inc. $315,580 during fiscal year 1997 in connection with
this construction. Wayne W. Waltz, a director of the Company, is a principle
shareholder of Waltz Construction, Inc. The Company's management believes that
the terms of the construction contract were no less favorable to the Company
than would have been obtained from a nonaffiliated construction firm
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information, as of May 15, 1997, regarding the
beneficial ownership of Common Stock of the Company by (i) each person or
group who is known by the Company to be the beneficial owner of more than 5%
of the outstanding Common Stock, (ii) all directors and nominees of the
Company, (iii) each individual named in the Summary Compensation Table and
(iv) all directors and executive officers of the Company as a group. The
Company believes that the beneficial owners of the Common Stock listed below,
based on information furnished by such owners, have sole voting and investment
power (or share such powers with his or her spouse) with respect to the
shares, subject to the information contained in the notes to the table.
<TABLE>
<CAPTION>
NAME AND ADDRESS PERCENT OF
(IF APPLICABLE) SHARES OUTSTANDING
OF BENEFICIAL OWNER BENEFICIALLY OWNED(1) SHARES(1)
------------------- --------------------- ---------
<S> <C> <C>
Daktronics, Inc 276,965 6.3%
Employee Stock Ownership Plan(2) (ESOP)
331 32nd Avenue, Brookings, SD 57006
James B. Morgan 159,320(3) 3.6%
John L. Mulligan 6,000(4) *
Dr. Duane E. Sander(5) 245,470(6) 5.6%
Dr. Aelred J. Kurtenbach(5) 448,585(7) 10.2%
Charles S. Roberts, M.D. 56,630(8) 1.3%
Frank J. Kurtenbach 152,630(9) 3.5%
Wayne W. Waltz 23,490(10) *
Roland J. Jensen 3,400(11) *
Edwin M. Theisen 1,500 *
James A. Vellinga 2,000 *
Paul J. Weinand 13,992(12) *
All executive officers and directors as a group (10
persons) 1,432,968 32.7%
</TABLE>
* Represents less than 1%
(1) For purposes of this table, a person or group of persons is deemed to
beneficially own shares issuable upon the exercise of options that are
currently exercisable or that become exercisable within sixty days
after the date hereof.
(2) The Common Stock held by the Daktronics, Inc. ESOP and allocated to the
plan participants are voted by the respective participants. Any
unallocated or nonvoted shares of Common Stock will be voted by the
trustee without discretion on the same proportionate basis as the voted
allocated shares.
(3) Includes (i) 21,630 shares issuable pursuant to currently exercisable
stock options and (ii) 4,290 shares held through the Daktronics, Inc.
ESOP.
(4) Includes 3,000 shares issuable pursuant to currently exercisable stock
options.
(5) Dr. Sander's and Dr. Kurtenbach's addresses are 331 32nd Avenue,
Brookings, South Dakota 57006.
(6) Includes (i) 3,000 shares issuable pursuant to currently exercisable
stock options, (ii) 82,330 shares owned by Dr. Sander's spouse and
(iii) 16,540 shares owned by Dr. Sander's son.
(7) Includes (i) 15,800 shares issuable to Dr. Kurtenbach pursuant to
currently exercisable stock options, (ii) 5,532 shares held through the
Daktronics, Inc. ESOP, (iii) 3,613 share held through the Daktronics,
Inc. 401(K) Plan, and (iv) 229,420 shares owned by Dr. Kurtenbach's
spouse.
(8) Includes 3,000 shares issuable pursuant to currently exercisable stock
options.
(9) Includes (i) 10,200 shares issuable pursuant to currently exercisable
stock options and (ii) 3,400 shares held through the Daktronics, Inc.
ESOP.
(10) Includes 3,000 shares issuable pursuant to currently exercisable stock
options.
(11) Includes 2,000 shares issuable pursuant to currently exercisable stock
options.
(12) Includes (i) 10,800 shares issuable pursuant to currently exercisable
stock options and (ii) 1,192 shares held through the Daktronics, Inc.
ESOP.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires executive officers
and directors, and persons who beneficially own more than ten percent (10%) of
the Company's Common Stock to file initial reports of ownership and reports of
changes in ownership with the Securities and Exchange Commission (SEC), and
furnish copies of those reports to the Company. Based solely on a review of the
copies of such forms furnished to the Company, and written representations from
the executive officers and directors, the Company believes that all Section
16(a) filing requirements were complied with during fiscal 1997 except Dr.
Kurtenbach who filed one form Form 4 representing one transaction late.
RATIFICATION OF APPOINTMENT OF
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
McGladrey & Pullen, LLP served as the Company's independent certified public
accountants for fiscal 1997. The appointment of independent certified public
accountants is made annually by the Audit Committee of the Board of Directors.
In making its appointment, the Audit Committee reviews both the audit scope
and the estimated fees for professional services for the coming year. The
Audit Committee has selected McGladrey & Pullen, LLP as the independent
certified public accountants for fiscal 1998. Representatives of McGladrey &
Pullen, LLP are expected to attend the 1997 Annual Meeting of Shareholders and
will be given the opportunity to make a statement if they so desire and to
respond to any questions raised at the meeting.
OTHER MATTERS
The Board of Directors of the Company knows of no other matters which may come
before the meeting. However, if any matters other than those referred to above
should properly come before the meeting calling for a vote of the shareholders,
it is the intention of the persons named in the enclosed proxy to vote such
proxy in accordance with their best judgment
SHAREHOLDER PROPOSALS FOR THE NEXT ANNUAL MEETING
Any proposal by a shareholder to be presented at the 1998 Annual Meeting must be
received at the Company's principal executive offices, 331 32nd Avenue,
Brookings, South Dakota 57006, addressed to the Secretary of the Company, not
later than March 30, 1998.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Duane E. Sander
Duane E. Sander
Secretary
Dated: July 25, 1997
DAKTRONICS, INC.
Annual Meeting of Shareholders - August 20, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Aelred J. Kurtenbach and Duane E. Sander, or
either of them, as proxy of the undersigned, with full power of substitution,
for and in the name of the undersigned, to represent the undersigned at the
Annual Meeting of Shareholders of Daktronics, Inc., to be held at Daktronics,
Inc., 331 32nd Avenue, Brookings, South Dakota 57006 on Wednesday, August 20,
1997 at 7:00 p.m. Central Daylight Time, and at any adjournments thereof, and to
vote all same of the undersigned, as designated below, with all the powers which
the undersigned would possess if personally at such meeting.
1. Election of Directors duly nominated for a term expiring in 2000: Frank
J. Kurtenbach, Roland J. Jensen, and James A. Vellenga.
[ ] FOR [ ] WITHHELD FOR ALL [ ] WITHHELD FOR THE
FOLLOWING ONLY
(Write the nominee's name
in space below):
- --------------------------------------------------------------------------------
2. To ratify the appointment of McGladrey and Pullen, LLP as independent
auditors for the Company for the fiscal year ending May 2, 1998.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournments
thereof.
THE PROXY ABOVE WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE GIVEN FOR
VOTING ON THE MATTERS ABOVE, THIS PROXY WILL BE VOTED FOR MATTERS 1 AND 2 ABOVE.
Shareholders who are present at the meeting may withdraw their Proxy and vote in
Person if they so desire. The undersigned acknowledges receipt of the Proxy
Statement for the 1997 Annual Meeting.
Date__________________,1997 ____________________________________________
Signature
____________________________________________
Signature if held jointly
Please sign exactly as name(s) appears on
this Proxy. If shares are registered in
more than one name, the signature of all
persons are required. A corporation should
sign in its full corporate name by a duly
authorized officer, stating their title.
Trustees, guardians, executors and
administrators should sign in their official
capacity, giving their full title as such.
If a partnership, please sign in partnership
name by authorized person.
PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY
No postage is required if returned in the enclosed envelope.
This Proxy may also be returned via fax to 605/697-4700.
