UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6
(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
ORBIT INTERNATIONAL CORP.
---------------------------
(Name of Registrant as Specified in Its Charter)
N/A
---
(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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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.
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ORBIT INTERNATIONAL CORP.
80 CABOT COURT
HAUPPAUGE, NEW YORK 11788
NOTICE OF 2010 ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Orbit International Corp.:
The 2010 Annual Meeting of Stockholders of Orbit International Corp. (the
"Company") will be held at the Sheraton Long Island, 110 Vanderbilt Motor
Parkway, Smithtown, New York 11788, at 10:00 a.m., Eastern Daylight Savings
Time, on June 18, 2010, for the following purposes:
1. To elect the Board of Directors for the ensuing year.
2. To ratify the appointment of Amper, Politziner & Mattia, LLP as
independent auditors and accountants for the Company for the fiscal year ending
December 31, 2010.
3. To transact such other business as may properly come before the meeting.
All stockholders are invited to attend the meeting. Stockholders of record
at the close of business on May 12, 2010, the record date fixed by the Board of
Directors, are entitled to notice of, and to vote at, the meeting.
Representation at the meeting in person or by proxy of at least one-third of all
outstanding shares of common stock is required to constitute a quorum. A
complete list of stockholders entitled to notice of, and to vote at, the meeting
will be open to examination by the stockholders beginning ten days prior to the
meeting for any purpose germane to the meeting during normal business hours at
the office of the Secretary of the Company at 80 Cabot Court, Hauppauge, New
York 11788.
YOUR VOTE AT THE MEETING IS VERY IMPORTANT TO US REGARDLESS OF THE NUMBER
OF SHARES YOU OWN. WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING,
PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE.
RETURNING A PROXY WILL NOT DEPRIVE YOU OF YOUR RIGHT TO ATTEND THE ANNUAL
MEETING AND VOTE YOUR SHARES IN PERSON.
BY ORDER OF THE BOARD OF DIRECTORS
MARK TUBLISKY
Secretary
Hauppauge, New York
May 13, 2010
ORBIT INTERNATIONAL CORP.
80 CABOT COURT
HAUPPAUGE, NEW YORK 11788
(631) 435-8300
______________________
PROXY STATEMENT
______________________
The accompanying proxy is solicited by the Board of Directors of Orbit
International Corp. (the "Company") for use at the Annual Meeting of
Stockholders (the "Annual Meeting") to be held at 10:00 a.m., Eastern Daylight
Savings Time, on June 18, 2010, at the Sheraton Long Island, 110 Vanderbilt
Motor Parkway, Smithtown, New York 11788, and any adjournment thereof. This
proxy material is being mailed to stockholders commencing on or about May 13,
2010.
VOTING SECURITIES; PROXIES
The Company will bear the cost of solicitation of proxies. In addition to
the solicitation of proxies by mail, certain officers and employees of the
Company, without additional remuneration, may also solicit proxies personally by
telefax and by telephone. In addition to mailing copies of this material to
stockholders, the Company may request persons, and reimburse them for their
expenses in connection therewith, who hold stock in their names or custody or in
the names of nominees for others to forward such material to those persons for
whom they hold stock of the Company and to request their authority for execution
of the proxies.
One-third of the outstanding shares of the Company's common stock, par
value $.10 per share (the "Common Stock"), present in person or represented by
proxy shall constitute a quorum at the Annual Meeting. The approval of a
plurality of the outstanding shares of Common Stock present in person or
represented by proxy at the Annual Meeting is required for election of the
nominees as directors. In all matters other than the election of directors, the
affirmative vote of the majority of the outstanding shares of Common Stock
present in person or represented by proxy at the Annual Meeting is required for
adoption of such matters.
The form of proxy solicited by the Board of Directors affords stockholders
the ability to specify a choice among approval of, disapproval of, or abstention
with respect to each matter to be acted upon at the Annual Meeting. Shares of
Common Stock represented by the proxy will be voted, except as to matters with
respect to which authority to vote is specifically withheld. Where the
solicited stockholder indicates a choice on the form of proxy with respect to
any matter to be acted upon, the shares will be voted as specified. Abstentions
and broker non-votes will not affect the outcome of the election of directors or
the ratification of the appointment of the independent auditors. With respect
to all other matters, if any, to be voted on by stockholders at the Annual
Meeting, abstentions will have the same effect as "no" votes, and broker
non-votes will have no effect on the outcome of the vote.
All shares of Common Stock represented by properly executed proxies which
are returned and not revoked will be voted in accordance with the instructions,
if any, given therein. If no instructions are provided in a proxy, the shares
of Common Stock represented by such proxy will be voted FOR the Board's nominees
for director, FOR the ratification of the appointment of Amper, Politziner &
Mattia, LLP and in accordance with the proxy-holder's best judgment as to any
other matters raised at the Annual Meeting.
At the close of business on May 12, 2010, there were 4,632,277 shares of
Common Stock outstanding and eligible for voting at the 2010 Annual Meeting.
The number of shares outstanding does not reflect any share repurchases from
April 29, 2010 through May 12, 2010. Each stockholder of record is entitled to
one vote for each share of Common Stock held on all matters that come before the
Annual Meeting. Only stockholders of record at the close of business on May 12,
2010, are entitled to notice of, and to vote at, the Annual Meeting.
REVOCABILITY OF PROXY
A stockholder who has given a proxy may revoke it at any time prior to its
exercise by giving written notice of such revocation to the Secretary of the
Company, by executing and delivering to the Company a later dated proxy
reflecting contrary instructions, or by appearing at the Annual Meeting and
taking appropriate steps to vote in person.
NO DISSENTER'S RIGHTS
Under Delaware law, stockholders are not entitled to dissenter's rights of
appraisal with respect to Proposal 2.
PROPOSAL 1
ELECTION OF DIRECTORS
The bylaws of the Company provide that each director serves from the date of
election until the next annual meeting of stockholders and until his successor
is duly elected and qualified. The specific number of directors is set by a
resolution adopted by a majority of the entire Board of Directors. The maximum
number of directors is currently fixed at eight, and the number of directors is
currently seven. The Company has nominated seven persons consisting of Dennis
Sunshine, Bruce Reissman, Mitchell Binder, Bernard Karcinell, Lee Feinberg,
Sohail Malad and Fredric Gruder, each a current Director, for re-election to the
Board of Directors. Proxies cannot be voted for a greater number of persons than
the number of nominees named.
The persons named in the accompanying proxy intend to vote for the election
of the nominees listed herein as directors. Each nominee has consented to serve
if elected. The Board of Directors has no reason to believe that any nominee
will not serve if elected, but if any of them should become unavailable to serve
as a director and if the Board of Directors designates a substitute nominee or
nominees, the persons named as proxies will vote for the substitute nominee or
nominees designated by the Board of Directors.
The following table sets forth certain information with respect to the
nominees and executive officers of the Company and is based on the records of
the Company and information furnished to it by such persons. Reference is made
to the section of this Proxy entitled, "Security Ownership of Certain Beneficial
Owners and Management," for information pertaining to stock ownership by the
nominees and executive officers of the Company.
Name of Nominee Age Independent Position
- -------------- --- ----------- --------
Dennis Sunshine 63 No President, Chief Executive Officer and
Director
Bruce Reissman 60 No Executive Vice President,
Chief Operating Officer and Director
Mitchell Binder 54 No Executive Vice President, Chief
Financial Officer and Director
Mark Tublisky 71 No Secretary (President, Behlman
Electronics, Inc.)
David Gutman 58 No President and Chief Operating
Officer of Tulip Development
Laboratory, Inc.
Kenneth J. Ice 48 No President and Chief Operating
Officer of Integrated Combat Systems
David Goldman 40 No Treasurer and Controller
Bernard Karcinell 71 Yes Director
Lee Feinberg 63 Yes Director
Sohail Malad 34 Yes Director
Fredric Gruder 64 Yes Director
BIOGRAPHICAL INFORMATION
Dennis Sunshine has been President and Chief Executive Officer of the
Company since March 1995 and a director of the Company since 1988. Mr. Sunshine
has held various positions with the Company since 1976, including Secretary and
Vice President of Operations from April 1988 to March 1995 and Director of
Operations from June 1983 to April 1988. In light of Mr. Sunshine's role as
Chief Executive Officer of the Company and his extensive knowledge of our firms
business developed over the course of his long career, our Board has concluded
he should be re-elected to the Board of Directors.
Bruce Reissman has been Executive Vice President and Chief Operating
Officer of the Company since March 1995 and a director of the Company since
1992. Mr. Reissman has held various positions with the Company since 1975,
including Vice President-Marketing from April 1988 to March 1995 and Director of
Sales and Marketing from 1976 to April 1988. In light of Mr. Reissman's
technology background and his extensive knowledge of our Company's business
developed over the course of his long career at our Company, the Board has
concluded he should be re-elected to the Board of Directors.
Mitchell Binder has been Executive Vice President of the Company since
2006, Vice President-Finance from 1986 to 2006 and its Chief Financial Officer
since 1983. He has been a director of the Company since 1985. Mr. Binder has
held various positions with the Company since 1983, including Treasurer and
Assistant Secretary from 1983 to March 1995. In light of Mr. Binder's financial
backgrounds and his extensive knowledge of our Company's business developed over
the course of his long career at our Company, the Board has concluded he should
be re-elected to the Board of Directors.
Mark Tublisky has been Secretary of the Company since March 2003 and has been
President of Behlman Electronics, Inc. since its acquisition by the Company from
Astrosystems, Inc. in 1996. Mr. Tublisky held various positions at Astrosystems,
Inc. from 1969 to 1996, including General Manager of its Automatic Test Division
and then as General Manager of the Behlman Division.
David Gutman has been President and Chief Operating Officer of Tulip
Development Laboratory, Inc. ("TDL") since August 2008. Prior thereto, he was
Vice President, Operations and Business Development for Aydin Displays from 2000
to 2007.
Kenneth J. Ice has been President and Chief Operating Officer of Integrated
Consulting Services, Inc. d/b/a Integrated Combat Systems ("ICS") since its
acquisition by the Company on December 31, 2007. Prior thereto, he had been
Chief Executive Officer of ICS since 1995.
David Goldman has been Treasurer of the Company since June 2004 and Controller
since April 2003. Prior thereto, he was Assistant Controller of Frequency
Electronics, Inc., a commercial and defense electronics supplier, from April
1999 until April 2003 and Accounting Supervisor from May 1995 to April 1999.
Bernard Karcinell has been a director of the Company since 2000. Mr. Karcinell
is a certified public accountant licensed in Florida since 1989. He also
performs financial advisory services to several individuals and corporations.
Prior thereto, he was a Partner at KPMG LLP and former President and CEO of
Designcraft Jewel Industries and CCR Video Corp. The Board concluded that Mr.
Karcinell should be a director of the Company because of his extensive knowledge
of and experience in accounting, auditing and financial reporting matters.
Lee Feinberg has been a director of the Company since February 2004. Mr.
Feinberg retired in November 2008 as a Managing Director of UBS Financial
Services Inc. and had functional responsibility as the Head of Corporate
Employee Financial Services. Mr. Feinberg had been with UBS Financial Services,
formerly PaineWebber, since 1987. In light of Mr. Feinberg's experience as a
managing director of a leading global financial services firm and the
contributions he has made during his tenure as a director of the Company,
including his service as Chair of our Nominating and Corporate Governor
Committee, our Board has concluded that Mr. Feinberg should be re-elected to our
Board of Directors.
Sohail Malad has been a director of the Company since July 2007. He
currently serves as a partner for Karla Enterprises, LLC an investment and
development firm. From 2006 through 2008, Mr. Malad was founder and partner of
Monarch Activist Partners LP ("Monarch") based in San Diego, CA, which owned in
excess of 5% of the outstanding shares of the Company until 2008. From 2004
through 2006, Mr. Malad was a consultant with the Los Angeles office of the
Boston Consulting Group. In light of Mr. Malad's extensive finance background,
his experience in due diligence related to merger and acquisitions, our board
has concluded that Mr. Malad should be re-elected to our Board of Directors.
Fredric Gruder has been a director of the Company since March 2008. Mr.
Gruder, an attorney at law, has been a sole practitioner since December 2001. He
specializes in mergers and acquisitions and corporate/securities law. He is a
graduate of Yale Law School and from July 1998 through July 2006, served on the
Board of Directors of Harvey Electronics, Inc., a specialty retailer and custom
installer of high quality audio/video consumer electronics and home theater
products. In light of Mr. Gruder's extensive corporate securities law
background, his merger and acquisitions experience and his service in other
public boards, our board has concluded that Mr. Gruder should be elected to our
Board.
We believe that the nominees for our Board of Directors provide an appropriate
mix of experience and skills relevant to the size and nature of our business.
As more specifically described in such person's individual biographies set forth
above, the directors possess relevant and industry-specific experience and
knowledge, which we believe enhances the Board's ability to oversee, evaluate
and direct our overall corporate strategy.
There are no family relationships among any of the directors or executive
officers of the Company except that Bruce Reissman and Dennis Sunshine are
brothers-in-law. The Company's executive officers serve in such capacity at the
pleasure of the Board.
STOCKHOLDER VOTE REQUIRED
Election of each director requires a plurality of the votes of the shares
of Common Stock present in person or requested by proxy at the meeting and
entitled to vote on the election of directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF THE
NOMINEES FOR ELECTION TO THE BOARD OF DIRECTORS NAMED ABOVE.
INFORMATION ABOUT THE BOARD OF DIRECTORS
The Board of Directors (the "Board") held seven (7) meetings and conducted
other business by unanimous written consent during the fiscal year ended
December 31, 2009. All directors attended at least 75% of the meetings held by
the Board and by all committees of the Board. Pursuant to the terms of the
Company's acquisition of Integrated Combat Systems, Kenneth J. Ice, ICS's
President and Chief Operating Officer, is entitled to attend all Board meetings.
The Company's 2009 annual meeting was attended by all of the Company's
seven directors. Attendance at the Company's annual meetings is strongly
encouraged, however, is not mandatory.
Stockholders may contact the Board by mail addressed to the entire Board,
or to one or more individual directors, at 80 Cabot Court, Hauppauge, New York
11788, Attn: Secretary. All communications directed to the Board or individual
directors in this manner will be relayed to the intended recipients.
Board Leadership
The Board has no formal policy with respect to separation of the positions
of Chairman and Chief Executive Officer or with respect to whether the Chairman
should be a member of management or an independent director, and believes that
these are matters that should be discussed and determined by the Board from time
to time. Currently, we do not have a Chairman of the Board of Directors.
Risk Management
The Board believes that risk management is an important component of the
Company's corporate strategy. While the Board assesses specific risks at its
committee levels, the Board, as a whole, oversees our risk management process,
and discusses and reviews with management major policies with respect to risk
assessment and risk management. The Board is regularly informed through its
interactions with management and committee reports about risks we face in the
course of our business including economic, financial, operational, legal and
regulatory risks.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board has established an audit committee, nominating and corporate
governance committee, and a compensation committee to assist it in the discharge
of its responsibilities. The principal responsibilities of each committee and
the members of each committee are described below. Actions taken by any
committee of the Board are reported to the Board.
Audit Committee
The Audit Committee of the Board currently consists of Bernard Karcinell,
Lee Feinberg, Sohail Malad and Fredric Gruder, each of whom is independent as
such term is defined in Rule 4200(a)(15) of the Nasdaq listing standards, as
amended. The Board has determined that Bernard Karcinell is an "audit committee
financial expert" as defined by the laws of the Securities and Exchange
Commission ("SEC"). The Audit Committee held seven (7) meetings during the
fiscal year ended December 31, 2009. Each year it recommends the appointment of
a firm of independent public accountants to examine the financial statements of
the Company and its subsidiaries for the coming year. In making this
recommendation, it reviews the nature of audit services rendered, or to be
rendered, to the Company and its subsidiaries. The Audit Committee reviews with
representatives of the independent public accountants the auditing arrangements
and scope of the independent public accountants' examination of the financial
statements, results of those audits, their fees and any problems identified by
the independent public accountants regarding internal accounting controls,
together with their recommendations. It also meets with the Company's Chief
Financial Officer and Controller to review reports on the functioning of the
Company's programs for compliance with its policies and procedures regarding
ethics and those regarding financial controls. The Audit Committee is also
prepared to meet at any time upon request of the independent public accountants
or the Controller to review any special situation arising in relation to any of
the foregoing subjects. Pursuant to the rules mandated by the SEC and the
Nasdaq listing standards, as amended, the Board has adopted an Audit Committee
Charter which sets forth the composition of the Audit Committee, the
qualifications of Audit Committee members and the responsibilities and duties of
the Audit Committee. A current copy of the Company's Audit Committee Charter is
available on the Company's website at www.orbitintl.com.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee was formed in March 2003, held
one (1) meeting during the fiscal year ended December 31, 2009 and currently
consists of Lee Feinberg, Bernard Karcinell, Sohail Malad and Fredric Gruder,
each of whom is independent as such term is defined in Rule 4200(a)(15) of the
Nasdaq listing standards, as amended. The Committee evaluates the appropriate
size of the Board, recommends a change in the composition of members of the
Board to reflect the needs of the business, interviews prospective candidates
and formally proposes the slate of directors to be elected at each Annual
Meeting of Stockholders. A current copy of the Nominating and Corporate
Governance Committee's charter accompanies the Company's proxy statement filed
on April 28, 2004 as Appendix A thereto.
When considering whether directors and nominees have the experience,
qualifications, attributes or skills, taken as a whole, to enable the Board of
Directors to satisfy its oversight responsibilities effectively in light of the
Company's business and structure, the Nominating and Corporate Governance
Committee focuses primarily on each person's background and experience as
reflected in the information discussed in each of the directors' individual
biographies set forth above. The Nominating and Corporate Governance Committee
annually reviews and makes recommendations regarding the composition and size of
the Board so that the Board consists of members with the proper expertise,
skills, attributes, and personal and professional backgrounds needed by the
Board, consistent with applicable regulatory requirements.
The Nominating and Corporate Governance Committee believes that all
directors, including nominees, should possess the highest personal and
professional ethics, integrity, and values, and be committed to representing the
long-term interests of our stockholders. The Nominating and Corporate Governance
Committee will consider criteria including the nominee's current or recent
experience as a senior executive officer, whether the nominee is independent, as
that term is defined in existing independence requirements of the Securities and
Exchange Commission, the business, scientific or engineering experience
currently desired on the Board, geography, the nominee's industry experience,
and the nominee's general ability to enhance the overall composition of the
Board.
The Nominating and Corporate Governance Committee does not have a formal
policy on diversity; however, in recommending directors, the Board considers the
specific background and experience of the Board members and other personal
attributes in an effort to provide a diverse mix of capabilities, contributions
and viewpoints which the Board believes enables it to function effectively as
the Board of Directors of a company with our size and nature of its business.
Although the Nominating and Corporate Governance Committee has not established
minimum qualifications for director candidates, it will consider, among other
factors:
- Broad experience; diversity,
- Wisdom and integrity,
- Judgment and skill,
- Understanding of the Company's business environment,
- Experience with businesses and other organizations of comparable
size,
- Ability to make independent analytical inquiries,
- The interplay of the candidate's experience with the experience of
other Board members,
- The extent to which the candidate would be a desirable addition to the
Board and any committees of the Board, and
- Willingness to devote adequate time to the Board.
The Nominating and Corporate Governance Committee will consider all director
candidates recommended by stockholders. Any stockholder who desires to recommend
a director candidate may do so in writing, giving each recommended candidate's
name, biographical data and qualifications, by mail addressed to the Chairman of
the Nominating and Corporate Governance Committee, in care of Orbit
International Corp., 80 Cabot Court, Hauppauge, New York 11788. A written
statement from the candidate consenting to being named as a candidate and, if
nominated and elected, to serve as a director, must accompany any stockholder
recommendation. Members of the Nominating and Corporate Governance Committee
will assess potential candidates on a regular basis.
Compensation Committee
The Compensation Committee of the Board currently consists of Fredric Gruder,
Bernard Karcinell and Sohail Malad, each of whom is independent as such term is
defined in Rule 4200(a)(15) of the Nasdaq listing standards, as amended. The
Compensation Committee held two (2) formal meetings, conducted other business by
unanimous written consent and met from time to time on an informal basis during
the fiscal year ended December 31, 2009. The Committee makes recommendations to
the Board as to the salaries of the President, sets the salaries of the other
elected officers and reviews salaries of certain other senior executives. It
grants incentive compensation to elected officers and other senior executives
and reviews guidelines for the administration of the Company's incentive
programs. The Compensation Committee also reviews and approves or makes
recommendations to the Board on any proposed plan or program which would benefit
primarily the senior executive group. The Compensation Committee also reviews
and approves financial measures and targets for annual incentive plans under
employment agreements for the three senior executive officers of the Company
entered into in January 2009. During 2006 and 2007, the Compensation Committee
utilized the services of a compensation consultant in the process of creating
new employment contracts for the three executive officers.
Corporate Governance
General
In furtherance of our Board's goals of providing effective governance of our
business and affairs for the long-term benefit of our stockholders and promoting
a culture and reputation of the highest ethics, integrity and reliability, our
board of directors has adopted the following corporate governance measures:
" Charters for our Audit Committee, Nominating and Corporate Governance
Committee and Compensation Committee, as described above; " Code of Ethics; and
" Employee Whistleblower Policy.
The Audit Committee Charter, Code of Ethics and Employee Whistleblower Policy
are available, free of charge, on the Company's web site at www.orbitintl.com
and in print upon written request to the Company's address to the attention of
the Secretary. The information on our web site is not a part of this Proxy
Statement.
Code of Ethics
The Board of Directors has adopted a Code of Ethics, which applies to all
directors, officers and employees, including the Company's principal executive
officer and principal financial officer. The Code of Ethics addresses, among
other things: " Ethical business conduct; " Compliance with legal requirements;
" Confidentiality of our business information; " Use of property; " Avoidance of
conflicts of interest; " Conduct of our accounting operations, preparation of
financial reports, and making of public disclosures; and " Reporting of any
violation of law or the Code of Ethics, unethical behavior, improper or
questionable accounting or auditing, or inaccuracy in our financial reports or
other public disclosures.
Whistleblower Policy
The Audit Committee has adopted a Whistleblower Policy that governs the receipt,
retention and treatment of complaints received by us regarding accounting,
internal controls, auditing matters and questionable financial practices. The
Whistleblower Policy is designed to protect the confidential, anonymous
submission by our employees of any concerns that they may have regarding
questionable accounting or auditing matters. The Whistleblower Policy permits
the reporting of those concerns by various means, including email, letter, or
telephone. Complaints will be reviewed under the Audit Committee's direction,
with oversight by the Chairman of the Audit Committee, Compliance Officer or
such other persons as the Audit Committee determines to be appropriate.
Policies And Procedures Regarding Related Party Transactions
The Company has established conflict of interest policies, to which all
directors, executive officers and key employees are subject. They are required
to disclose to the Company's Chief Compliance Officer in writing each outside
relationship, activity and interest that creates a potential conflict of
interest. All directors, executive officers and other key employees are required
to disclose in writing each year whether they are personally in compliance with
such policy. In addition each director and executive officer is required to
complete an annual questionnaire which calls for disclosure of any transactions
in which the Company is or is to be a participant, on the one hand, and in which
such director or executive officer or any member of his family has a direct or
indirect material interest, on the other. The Board of Directors is of the
opinion that these procedures are sufficient to allow for the review, approval
or ratification of any transactions with related persons that would be required
to be disclosed under applicable SEC rules.
Complaint Procedure; Communications with Directors
The Sarbanes-Oxley Act of 2002 requires companies to maintain procedures to
receive, retain and respond to complaints received regarding accounting,
internal accounting controls or auditing matters and to allow for the
confidential and anonymous submission by employees of concerns regarding
questionable accounting or auditing matters. The Company currently has such
procedures in place. Any employee of the Company may report concerns regarding
these matters in the manner specified in the Company's Whistle Blower Policy
which is posted at the Company's Hauppauge facility. A printed copy of the
Company's Whistle Blower Policy will be provided to any shareholder upon request
to the Company at 80 Cabot Court, Hauppauge, New York 11788, or by telephone
(631) 435-8300.
REPORT OF THE AUDIT COMMITTEE
Management has the primary responsibility for the integrity of the
Company's financial information and the financial reporting process, including
the system of internal control over financial reporting. Amper, Politziner &
Mattia, LLP ("Amper"), the Company's independent registered public accounting
firm, is responsible for conducting an independent audit of the Company's
financial statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States) and expressing an opinion on the
financial statements based upon the audit. The Audit Committee is responsible
for overseeing the conduct of these activities by management and Amper.
As part of its oversight responsibility, the Audit Committee has reviewed
and discussed the audited financial statements and the adequacy of financial
controls with management and Amper. The Audit Committee also has discussed with
Amper the matters required to be discussed by Statement on Auditing Standards
No. 61, as amended (Communication with Audit Committees). The Audit Committee
has received the written disclosures and the letter from Amper required by the
applicable requirements of the Public Company Accounting Oversight Board
regarding the independent accountant's communication and has discussed with
Amper their firm's independence.
Based upon these reviews and discussions, the Audit Committee recommended
to the Board of Directors that the audited financial statements be included in
the Company's Annual Report on Form 10-K for the year ended December 31, 2009
for filing with the SEC.
Members of the Audit Committee
BERNARD KARCINELL
LEE FEINBERG
SOHAIL MALAD
FREDRIC GRUDER
THE FOREGOING REPORT SHALL NOT BE DEEMED TO BE "SOLICITING MATERIAL" OR TO
BE "FILED" WITH THE SECURITIES AND EXCHANGE COMMISSION AND SHOULD NOT BE DEEMED
INCORPORATED BY REFERENCE BY ANY GENERAL STATEMENT INCORPORATING BY REFERENCE
THIS PROXY STATEMENT INTO ANY FILING UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, EXCEPT TO THE
EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THIS INFORMATION BY REFERENCE
AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH ACTS.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth, with respect to the Company's fiscal years ended December 31, 2009, December 31,
2008, and December 31, 2007, all compensation earned by each person who is required to be listed pursuant to Item
402(m)(2) of Regulation S-K.
NON-EQUITY
STOCK OPTION INCENTIVE PLAN ALL OTHER
NAME AND AWARDS* AWARDS* COMPENSATION COMPENSATION TOTAL
PRINCIPAL POSITION YEAR SALARY ($) BONUS $ ($)(1)(2) ($) ($)(4) ($)(4) ($)
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Dennis Sunshine 2009 449,000 0 125,000 0 130,000 110,244 814,244
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
President and Chief 2008 449,000 0 125,000 0 117,863 112,795 804,658
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Executive Officer 2007 423,000 0 0 0 95,400 78,526 596,926
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Bruce Reissman 2009 389,300 0 35,000 0 34,064 34,427 492,791
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Executive Vice President, 2008 389,300 0 35,000 0 0 33,797 458,097
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Chief Operating Officer 2007 412,000 0 0 0 95,400 33,125 540,525
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Mitchell Binder 2009 300,600 0 15,000 31,237(3) 46,217 34,050 427,104
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Executive Vice President, 2008 300,600 0 15,000 0 33,818 34,879 384,297
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Chief Financial Officer 2007 318,000 0 0 0 47,700 31,269 396,969
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Mark Tublisky 2009 205,330 0 0 0 33,123 14,884 253,337
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Secretary (President, 2008 197,400 0 15,665 0 36,184 14,814 264,063
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
Behlman Electronics, Inc.) 2007 190,000 0 0 0 28,300 13,611 231,911
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
David Gutman(6) 2009 200,000 0 0 0 0 24,212 224,212
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
President, TDL 2008 77,000 0 12,050 0 0 9,101 98,151
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
2007 0 0 0 0 0 0 0
- -------------------------- ---- ---------- -------- --------- --------- --------------- ------------- --------
* These columns represent the grant date fair value of the awards as calculated
in accordance with FASB ASC 718 (Stock Compensation). Pursuant to SEC rule
changes effective February 28, 2010, we are required to reflect the total grant
date fair values of the option grants in the year of grant, rather than the
portion of this amount that was recognized for financial statement reporting
purposes in a given fiscal year which was required under the prior SEC rules,
resulting in a change to the amounts reported in prior Proxy Statements.
(1) In June 2008, Messrs Sunshine, Reissman and Binder received 17,605,
5,281, and 2,112, respectively, of Common Stock, valued at $2.27 per share,
pursuant to a Long Term Incentive Plan ("LTIP"). The shares vest ratably each
December 31 over a three year period for Sunshine and Reissman and over a two
year period for Binder, provided each officer is still employed, and are subject
to acceleration for death or change in control.
(2) In March 2009, Messrs Sunshine, Reissman and Binder received 55,066,
16,272, and 6,607, respectively, of Common Stock, valued at $2.27 per share,
pursuant to a Long Term Incentive Plan ("LTIP"). The shares vest ratably each
December 31 over a three year period for Sunshine and Reissman and over a two
year period for Binder, provided each officer is still employed, and are subject
to acceleration for death or change in control.
(3) On February 13, 2009, 112,500 of Mr. Binder's stock options at an
exercise price of $1.92 per share, scheduled to expire on March 27, 2010, were
cancelled by the Compensation Committee. On the same date, the Compensation
Committee granted to Mr. Binder 85,000 stock options at an exercise price of
$2.00 per share expiring on February 12, 2015. The vesting schedule of the
option is as follows: one-sixth vested on February 13, 2009 and one-sixth vests
on February 13 of each year thereafter through 2014.
(4) Non-Equity Incentive Plan Compensation consists of the accrued incentive
bonus on pre-tax income as defined in each executive's employment agreement.
(5) See the "All Other Compensation Table" below for additional information.
(6) Mr. Gutmen commenced employment as of August 1, 2008.
ALL OTHER COMPENSATION TABLE
The following table describes each component of the "All Other Compensation" in the Summary
Compensation Table set forth above.
LIFE LONG TERM LONG TERM MEDICAL COUNTRY
401(K) PLAN INSURANCE CAR LEASE/ DISABILITY CARE REIMB CLUB
NAME OF EXECUTIVE CONTRIBUTIONS PREMIUMS CAR USAGE PREMIUM PREMIUM PLAN DUES TOTAL
- ----------------- ------------ --------- ------------ ----------- ---------- -------- -------- -------
2009 $ 5,526 $ 34,831 $ 22,848 $ 4,961 $ 7,446 $ 7,157 $ 27,475 $110,244
2008 $ 4,600 $ 33,066 $ 22,254 $ 4,961 $ 7,446 $ 7,188 $ 33,280 $112,795
D. Sunshine 2007 $ 4,400 $ 33,066 $ 22,200 $ 4,961 $ 7,446 $ 6,453 - $ 78,526
- ------------------ ------------ ---------- ------------ ----------- ----------- -------- --------- -------
2009 $ 4,900 $ 6,650 $ 11,091 $ 3,730 $ 4,478 $ 3,578 - $ 34,427
2008 $ 4,600 $ 6,650 $ 10,745 $ 3,730 $ 4,478 $ 3,594 - $ 33,797
B. Reissman 2007 $ 4,400 $ 6,650 $ 10,744 $ 3,626 $ 4,478 $ 3,226 - $ 33,124
- ------------------ ------------ ---------- ----------- ----------- ---------- -------- --------- --------
2009 $ 5,135 $ 4,450 $ 13,068 $ 4,798 $ 3,021 $ 3,578 - $ 34,050
2008 $ 5,944 $ 4,450 $ 13,072 $ 4,798 $ 3,021 $ 3,594 - $ 34,879
M. Binder 2007 $ 4,400 $ 4,450 $ 11,374 $ 4,798 $ 3,021 $ 3,226 - $ 31,269
- ------------------ ------------ ---------- ----------- ----------- ---------- -------- --------- --------
2009 $ 4,106 - $ 7,200 - - $ 3,578 - $ 14,884
2008 $ 4,020 - $ 7,200 - - $ 3,594 - $ 14,814
M. Tublisky 2007 $ 3,185 - $ 7,200 - - $ 3,226 - $ 13,611
- ------------------ ------------ ---------- ------------ ----------- ---------- --------- --------- --------
2009 $ 3,372 - $ 19,520 - - $ 1,300 - $ 24,192
2008 $ 1,600 - $ 7,150 - - 351 - $ 9,101
D. Gutman 2007 - - - - - - - -
- ------------------ ------------ ---------- ------------ ----------- ---------- --------- --------- --------
GRANTS OF PLAN-BASED AWARDS IN 2009
None.
Employment Agreements
On December 11, 2007, Orbit's Board of Directors (the "Board") authorized the
Company to enter into employment agreements with its senior management, which
went into effect on January 1, 2008. The full texts of the Employment Agreements
are filed as Exhibits to the Company's Current Report on Form 8-K for December
11, 2007 and are incorporated herein by reference. The following discussion
provides a summary of the material terms of the Employment Agreements, which
discussion is qualified in its entirety by reference to the entire text of the
Employment Agreements.
The Sunshine Employment Agreement
On December 14, 2007, the Company entered into an employment agreement with
Dennis Sunshine, its Chief Executive Officer (the "Sunshine Employment
Agreement"). The Sunshine Employment Agreement provides for an annual base
salary of $449,000 ("Base Salary"). The term of the agreement is for three
years commencing on January 1, 2008 (the "Term"). Mr. Sunshine is eligible to
participate in an executive annual incentive plan ("AIP") that is approved by
the Company's Compensation Committee. Pursuant to such AIP, for each year
during the Term, Mr. Sunshine could receive up to 100% of his Base Salary, with
an annual target incentive of 50% of Base Salary, based on the satisfaction of
certain financial and strategic objectives approved by the Board each year
during the Term. Mr. Sunshine shall also be eligible to participate in an
executive long term incentive plan ("LTIP") that is approved by the Board under
which Mr. Sunshine would be entitled to receive cash, shares or options (with a
three year vesting schedule) to purchase the Company's stock with a value of
$125,000 annually during the Term. In addition, Mr. Sunshine may be awarded
an annual discretionary bonus ("Bonus") during the Term by the Company's
Compensation Committee, at its sole discretion. Mr. Sunshine is entitled to
receive other benefits under his employment agreement including reimbursement of
country club fees and vehicle expenses. During the Term, the Company shall
maintain life insurance on Mr. Sunshine in the amount of one million
dollars.
If the Company decides not to extend Mr. Sunshine's employment agreement
beyond the Term, terminates Mr. Sunshine without Cause, or Mr. Sunshine resigns
for Good Reason (as those terms are defined in his employment agreement), Mr.
Sunshine shall be entitled to receive a severance amount equal to two years of
his Base Salary and two years of his AIP, and all non-vested shares or options
received under his LTIP shall accelerate and vest on the date of termination. In
the event of a Change in Control (as that term is defined in his employment
agreement), Mr. Sunshine shall be entitled to receive the maximum amount that
can be paid to him without any portion thereof constituting an "excess parachute
payment" as defined in Section 280G(b)(1) of the Internal Revenue Code of 1986,
as amended (approximately three times his Base Salary) along with other benefits
set forth in his employment agreement.
Mr. Sunshine is entitled to participate in the Company's executive benefit
programs and is subject to certain non-competition and non-solicitation
provisions in his employment agreement, which extend for a period of three years
following the termination of the Term of Mr. Sunshine's employment with the
Company.
The Binder Employment Agreement
On December 14, 2007, the Company entered into an employment agreement with
Mitchell Binder, its Chief Financial Officer and Executive Vice President -
Finance (the "Binder Employment Agreement") and was amended on December 22,
2009. The Binder Employment Agreement is substantially similar to the Sunshine
Employment Agreement. The following discussion provides a summary of the
material terms of the Binder Employment Agreement, which discussion is qualified
in its entirety by reference to the entire text of the Binder Employment
Agreement.
The Binder Employment Agreement, as amended, provides for an annual
base salary of $318,000 ("Base Salary"). The term of the agreement is for three
years commencing on January 1, 2010 (the "Term"). Mr. Binder is eligible to
participate in an executive annual incentive plan ("AIP") that is approved by
the Company's Compensation Committee. Pursuant to such AIP, for each year
during the Term, Mr. Binder could receive up to 37.5% of his Base Salary, with
an annual target incentive of 25% of Base Salary, based on the satisfaction of
certain financial and strategic objectives approved by the Board each year
during the Term. Mr. Binder shall also be eligible to participate in an
executive long term incentive plan ("LTIP") that is approved by the Board under
which Mr. Binder would be entitled to receive cash, shares or options (with a
two year vesting schedule) to purchase the Company's stock with a value of
$15,000 annually during the Term. In addition, Mr. Binder may be awarded an
annual discretionary bonus ("Bonus") during the Term by the Company's
Compensation Committee, at its sole discretion. Mr. Binder is entitled to
receive other benefits under his employment agreement including vehicle
expenses. During the Term, the Company shall maintain life insurance on Mr.
Binder in the amount of one million dollars.
If the Company decides not to extend the agreement beyond the Term,
terminates Mr. Binder without Cause, or Mr. Binder resigns for Good Reason (as
those terms are defined in his employment agreement), Mr. Binder shall be
entitled to receive a severance amount equal to two years of his Base Salary and
two years of his AIP, and all non-vested shares or options received under his
LTIP shall accelerate and vest on the date of termination. In the event of a
Change in Control (as that term is defined in his employment agreement), Mr.
Binder shall be entitled to receive the maximum amount that can be paid to him
without any portion thereof constituting an "excess parachute payment" as
defined in Section 280G(b)(1) of the Internal Revenue Code of 1986, as amended
(approximately three times his Base Salary) along with other benefits set forth
in his employment agreement.
Mr. Binder is entitled to participate in the Company's executive benefit
programs and is subject to certain non-competition and non-solicitation
provisions in his employment agreement, which extend for a period of two years
following the termination of the Term of Mr. Binder's employment with the
Company.
The Reissman Employment Agreement
On December 14, 2007, the Company entered into an employment agreement with
Bruce Reissman, the Chief Operating Officer and Executive Vice President (the
"Reissman Employment Agreement"). The Reissman Employment Agreement is also
substantially similar to the Sunshine Employment Agreement. The following
discussion provides a summary of the material terms of the Reissman
Employment Agreement, which discussion is qualified in its entirety by
reference to the entire text of the Reissman Employment Agreement.
The Reissman Employment Agreement provides for an annual base salary of
$389,300 ("Base Salary"). The term of the agreement is for three years
commencing on January 1, 2008 (the "Term"). Mr. Reissman is eligible to
participate in an executive annual incentive plan ("AIP") that is approved by
the Company's Compensation Committee. Pursuant to such AIP, for each year
during the Term, Mr. Reissman could receive up to 52.5% of his Base Salary, with
an annual target incentive of 35% of Base Salary, based on the satisfaction of
certain financial and strategic objectives approved by the Board each year
during the Term. Mr. Reissman shall also be eligible to participate in an
executive long term incentive plan ("LTIP") that is approved by the Board under
which Mr. Reissman would be entitled to receive cash, shares or options (with a
three year vesting schedule) to purchase the Company's stock with a value of
$37,500 annually during the Term. In addition, Mr. Reissman may be awarded an
annual discretionary bonus ("Bonus") during the Term by the Company's
Compensation Committee, at its sole discretion. Mr. Reissman is entitled to
receive other benefits under his employment agreement including reimbursement of
country club fees and vehicle expenses. During the Term, the Company shall
maintain life insurance on Mr. Reissman in the amount of one million dollars.
If the Company decides not to extend Mr. Reissman's employment agreement
beyond the Term, terminates Mr. Reissman without Cause, or Mr. Reissman resigns
for Good Reason (as those terms are defined in his employment agreement), Mr.
Reissman shall be entitled to receive a severance amount equal to two years of
his Base Salary and two years of his AIP, and all non-vested shares or options
received under his LTIP shall accelerate and vest on the date of termination.
In the event of a Change in Control (as that term is defined in his employment
agreement), Mr. Reissman shall be entitled to receive the maximum amount that
can be paid to him without any portion thereof constituting an "excess parachute
payment" as defined in Section 280G(b)(1) of the Internal Revenue Code of 1986,
as amended (approximately three times his Base Salary) along with other benefits
set forth in his employment agreement.
Mr. Reissman is entitled to participate in the Company's executive benefit
programs and is subject to certain non-competition and non-solicitation
provisions in his employment agreement, which extend for a period of three years
following the termination of the Term of Mr. Reissman's employment with the
Company.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END 2009
The table on the following page summarizes, for each of the executive officers
named in the Summary Compensation Table, grants of stock options and restricted
stock outstanding at December 31, 2009. The market value of the stock awards is
based on the closing market price of our stock on December 31, 2009 which was
$3.85.
OUTSTANDING EQUITY AWARDS AT YEAR-END
OPTION AWARDS STOCK AWARDS (A)(B)(C)
------------- ----------------------
Option Option Option Number Market Equity Value of
Grant # # Exercise Expiration Stock Award of Shares Value Incentive Unearned
Date Exercisable Unexercisable Price Date Date Not Vested Not Vested Plan Awards Shares
------- ----------- ------------- ---------- ----------- ----------- ----------- --------- ---------- ---------
D. Sunshine 1/25/2001 70,313 - $1.07 1/25/2011 - - - - -
7/29/2003 31,250 - $4.51 7/29/2013 - - - - -
6/25/2004 31,250 - $5.96 6/25/2014 - - - - -
10/13/2004 46,875 $ 181,000 - -
6/18/2008 5,868 23,000 - -
3/11/2009 36,710 141,000 - -
B. Reissman 1/25/2001 66,563 - $1.07 1/25/2011 - - - - -
7/29/2003 31,250 - $4.51 7/29/2013 - - - - -
6/25/2004 31,250 - $5.96 6/25/2014 - - - - -
10/13/2004 46,875 $ 181,000 - -
6/18/2008 1,760 7,000 - -
3/11/2009 10,848 42,000 - -
M. Binder 3/27/2000 22,822(D) - $1.92 3/27/2010 - - - - -
1/25/2001 29,944 - $1.07 1/25/2011 - - - - -
7/29/2003 31,250 - $4.51 7/29/2013 - - - - -
6/25/2004 31,250 - $5.96 6/25/2014 - - - - -
2/13/2009 14,166(D) 70,834 $2.00 2/13/2014
10/13/2004 46,875 $ 181,000 - -
6/18/2008 - - - -
3/11/2009 4,404 17,000 - -
M. Tublisky 7/29/2003 8,438 - $4.51 7/29/2013 - - - - -
8/14/2008 2,166 $8,000 - -
D. Gutman - - - 8/14/2008 1,667 $6,000 - -
(A) In October 2004, each of Messrs. Sunshine, Reissman and Binder received
93,750 shares of Common Stock, valued at $5.32 per share, the fair market value
of the stock on the date of grant. The shares were awarded as a retention award
to remain with the Company for ten years. The shares are held in escrow, subject
to forfeiture and vest over ten years. The shares vest provided each officer is
still employed, and are subject to acceleration for death or a change of control
(as defined in the Stock Escrow Agreement), as follows: (i) 28,125 shares, which
vested at October 13, 2007 and (ii) 9,375 shares, which vest each year for the
years October 13, 2008 through October 13, 2014.
(B) In June 2008, Messrs Sunshine, Reissman and Binder received 17,605, 5,281,
and 2,112, respectively, of Common Stock, valued at $7.10 per share, pursuant to
a Long Term Incentive Plan ("LTIP"). The shares vest ratably each December 31
over a three year period, provided each officer is still employed, and are
subject to acceleration for death or change in control.
(C) In March 2009, Messrs Sunshine, Reissman and Binder received 55,066, 16,272,
and 6,607, respectively, of Common Stock, valued at $2.27 per share, pursuant to
a Long Term Incentive Plan ("LTIP"). The shares vest ratably each December 31
over a three year period, provided each officer is still employed, and are
subject to acceleration for death or change in control.
(D) On February 13, 2009, 112,500 of Mr. Binder's stock options at an exercise
price of $1.92 per share, scheduled to expire on March 27, 2010, were cancelled
by the Compensation Committee. On the same date, the Compensation Committee
granted to Mr. Binder 85,000 stock options at an exercise price of $2.00 per
share expiring on February 12, 2015. The vesting schedule of the option is as
follows: one-sixth vested on February 13, 2009 and one-sixth vests on February
13 of each year thereafter through 2014.
OPTION EXERCISES AND STOCK VESTED
This table provides information about any options that were exercised,
or any stock that vested in 2009.
OPTION AWARDS STOCK AWARDS
# OF SHARES VALUE # OF SHARES VALUE
ACQUIRED REALIZED ON ACQUIRED ON REALIZED ON
NAME OF EXECUTIVE ON EXERCISE EXERCISE VESTING VESTING
- ----------------- ----------- -------- --------- ------
D. Sunshine 70,313 $138,000 9,375 $33,844
- ----------- ------ ------- ------ -------
B. Reissman - - 9,375 $33,844
- ----------- ------ ------- ------- -------
M. Binder 4,929 $9,000 9,375 $33,844
- ----------- ------ ------- ----- - -------
M. Tublisky - - - -
- ----------- ------ ------- ------- -------
K. Ice - - - -
- ----------- ------ ------- ------- --------
COMPENSATION OF DIRECTORS
Directors of the Company who are not employed by the Company received
director fees of $3,000 per quarter ($12,000 per annum). Employee directors are
not compensated for services as a director. All directors are reimbursed for
expenses incurred on behalf of the Company. The following table sets forth
compensation paid to each non-employee director during 2009:
Stock Non-Equity All
Fees Earned or Stock Option Incentive Other
Name Paid in Cash Awards Awards(1) Plan Comp. Compensation Total
- ---------------- ------------- ----- --------- -------- ------------ -----
Lee Feinberg(1) $12,000 - $ - - - $12,000
Bernard Karcinell $12,000 - $ - - - $12,000
Sohail Malad $12,000 - $ - - - $12,000
Fredric Gruder $12,000 - $ - - - $12,000
(1) Mr. Feinberg directed his entire fee earned as a director to a
designated charity.
As of December 31, 2009, each person that served as a director during 2009 held
the following outstanding options to purchase Common Stock:
Option Option
Number of Securities Exercise Price Grant
Name Underlying Outstanding Options ($) Date
- ------- ------------------------------- --------------- ------
Bernard Karcinell 2,604 2.04 8/7/00
520 1.05 6/29/01
520 3.01 6/28/02
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors is responsible for
determining the compensation of executive officers of the Company, as well as
compensation awarded pursuant to the Company's Plans (defined below).
Messrs. Gruder, Karcinell and Malad served on the Compensation Committee
during 2009, with Mr. Gruder serving as Chairman.
No member of the Compensation Committee is or has been an officer or
employee of the Company or any of its subsidiaries. In addition, no member of
the Compensation Committee had any relationships with the Company or any other
entity that require disclosure under the proxy rules and regulations promulgated
by the SEC.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of April 27, 2010, certain information
with respect to persons known by the Company to be the beneficial owners of more
than 5% of the Common Stock.
Beneficial Ownership
of Common Stock
------------------------
Number of Percentage of
Shares Class
----------- ---------------
Name and Address
- ----------------
Elkhorn Partners Limited Partnership (1) 616,737 13.3%
222 Skyline Drive
Elkhorn, NB 68022
(1) Based on Form 4 filed by Elkhorn Partners Limited Partnership with the
SEC on April 23, 2010.
OWNERSHIP BY DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth, as of April 16, 2010, information concerning the
beneficial ownership of Common Stock by each director, each of the executive
officers named in this proxy statement and all current directors and executive
officers as a group. Under rules of the SEC, persons who have power to vote or
dispose of securities, either alone or jointly with others, are deemed to be the
beneficial owners of such securities. Each person reflected in the table below
has both sole voting and investment power with respect to the shares included in
the table, except as described in the footnotes below.
Shares Subject to Percent
Number of Shares Owned Exercisable of
Name of Beneficial Owner** Directly or Indirectly Options Total Class(8)
- ---------------------------------------- ----------------------- -------------- ----- ---------
Dennis Sunshine, President
and Chief Executive Officer (1) (2) 504,578 62,500 567,078 12.1%
Bruce Reissman, Executive Vice
President, Chief Operating Officer (3) 384,710 129,063 513,773 10.8%
Mitchell Binder, Executive Vice
President, Chief Financial Officer (4) 114,563 118,676(4) 233,239 4.9%
Mark Tublisky, Secretary (5) 6,350 8,438 14,788 *
David Goldman, Treasurer (6) 3,750 3,000 6,750 *
David Gutman, President, (7)
Chief Operating Officer, Tulip
Development Laboratory, Inc. 2,500 - 2,500 *
Kenneth Ice, President
Chief Operating Officer
Integrated Combat Systems 145,746 - 145,746 3.1%
Lee Feinberg, Director 0 0 0 *
Bernard Karcinell, Director 4,000 3,644 7,644 *
Sohail Malad, Director 0 0 0 *
Fredric Gruder, Director 0 0 0 *
All officers and directors
as a group (11 persons) 1,166,197 325,321 1,491,518 30.1%
* Less than one percent
** Address is c/o Orbit International Corp., 80 Cabot Court, Hauppauge, New
York 11788
(1) Includes 131,193 shares held by Mr. Sunshine's wife Francine Sunshine.
(2) Includes 123,420 restricted shares subject to forfeiture.
(3) Includes 69,075 restricted shares subject to forfeiture.
(4) Includes 55,356 restricted shares subject to forfeiture. Does not
include options to purchase 56,667 shares of Common Stock not currently
exercisable.
(5) Includes 2,167 restricted shares subject to forfeiture.
(6) Includes 1,834 restricted shares subject to forfeiture.
(7) Includes 1,667 restricted shares subject to forfeiture.
(8) Based on 4,632,277 shares issued and outstanding as of May 12, 2010.
Except as otherwise noted in the footnotes to this table, the named person owns
directly and exercises sole voting and investment power over the shares listed
as beneficially owned by such person. Includes any securities that such person
has the right to acquire within sixty days pursuant to options, warrants,
conversion privileges or other rights.
PROPOSAL 2
INDEPENDENT ACCOUNTANTS
RATIFICATION OF APPOINTMENT OF AUDITORS
The Board, upon the recommendation of the Audit Committee, has appointed
Amper, Politziner & Mattia, LLP ("Amper") as independent accountants for the
Company to audit the books and accounts of the Company for the current fiscal
year ending December 31, 2010.
Representatives of Amper are expected to be available at the meeting to
respond to appropriate questions and will be given the opportunity to make a
statement if they desire to do so. If the stockholders do not ratify the
appointment of this firm, the appointment of another firm of independent
certified public accountants will be considered by the Board of Directors.
AUDIT FEES AND AUDIT RELATED FEES
In accordance with the Audit Committee's charter and pursuant to SEC rules,
the Audit Committee reviewed all services performed by Amper and McGladrey &
Pullen, LLP ("M&P") for the Company in its fiscal years ended December 31, 2009
and 2008, within and outside the scope of their quarterly and annual auditing
function. The aggregate fees billed and to be billed by the Company's
independent auditors for each of the last two fiscal years are as follows:
December 31, 2008 December 31, 2009
----------------- -----------------
Audit fees - McGladrey & Pullen, LLP $247,000 $ 30,000
Audit fees - Amper, Politziner & Mattia, LLP $ - $192,000
Audit related fees - McGladrey & Pullen, LLP $ 78,000 $ -
Tax fees - McGladrey & Pullen, LLP $ 35,000 $ -
All other fees - McGladrey & Pullen, LLP $ - $ 8,000
Tax fees - Amper Politziner & Mattia, LLP $ - $ 29,000
Audit fees consist of fees related to professional services rendered during
2009 and 2008 in connection with the audit of our annual financial statements,
the review of interim financial statements included in each of our Quarterly
Reports on Form 10-Q, and other professional services provided by our registered
public accounting firm in connection with statutory or regulatory filings or
engagements.
Audit-related fees were for audit and due diligence work related to the
acquisition of Integrated Consulting Services, Inc. ("ICS") for the year
December 31, 2007.
AUDIT COMMITTEE PRE-APPROVAL POLICY
Amper was retained to audit the consolidated financial statements for the
year ended December 31, 2009. M&P was retained to audit the consolidated
financial statements for the years ended December 31, 2008. In addition, Amper
and M&P were retained to provide other auditing and advisory services in the
2009 and 2008 fiscal years. Amper and M&P have to maintain objectivity and
independence in their audit of the financial statements. To minimize
relationships that could appear to impair the objectivity of Amper and M&P, the
Audit Committee has restricted the non-audit services that Amper and M&P may
provide to primarily tax services and merger and acquisition due diligence and
audit services, and has determined that we would obtain even these non-audit
services from Amper and M&P and/or its aligned company only when the services
offered by Amper and M&P and its aligned company are more effective or
economical than services available from other service providers.
The Audit Committee also has adopted policies and procedures for
pre-approving all non-audit work performed by Amper and M&P or any other
accounting firms. Specifically, the audit committee has pre-approved the use of
Amper and M&P for specific types of services within the following categories of
non-audit services: merger and acquisition due diligence and audit services; tax
services; internal control reviews; and reviews and procedures that are
requested of Amper and M&P. In each case, the Audit Committee has also set a
specific annual limit on the amount of such services which we would obtain from
Amper and M&P, and has required management to report the specific engagements to
the Committee on a quarterly basis and to obtain specific pre-approval from the
Audit Committee for all engagements.
THE BOARD OF DIRECTORS DEEMS THE RATIFICATION OF THE APPOINTMENT OF AMPER,
POLITZINER & MATTIA, LLP AS THE AUDITORS FOR THE COMPANY TO BE IN THE COMPANY'S
BEST INTEREST AND RECOMMENDS A VOTE "FOR" SUCH RATIFICATION.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), requires the Company's directors and executive officers, and persons who
beneficially own more than ten percent of a registered class of the Company's
equity securities, to file with the SEC initial reports of ownership and reports
of changes in ownership of Common Stock and the other equity securities of the
Company. Officers, directors, and persons who beneficially own more than ten
percent of a registered class of the Company's equities are required by the
regulations of the SEC to furnish the Company with copies of all Section 16(a)
forms they file. To the Company's knowledge, based solely on review of the
copies of such reports furnished to the Company and written representations that
no other reports were required, during the fiscal year ended December 31, 2009,
all Section 16(a) filing requirements applicable to its officers, directors, and
greater than ten percent beneficial owners were complied with.
STOCKHOLDER PROPOSALS
No person who intends to present a proposal for action at a forthcoming
stockholders' meeting of the Company may seek to have the proposal included in
the proxy statement or form of proxy for such meeting unless such person (a) is
a record beneficial owner of at least 1% or $2,000 in market value of shares of
Common Stock, has held such shares for at least one year at the time the
proposal is submitted, and such person shall continue to own such shares through
the date on which the meeting is held, (b) provides the Company in writing with
such person's name, address, the number of shares held by such person and the
dates upon which such person acquired such shares with documentary support for a
claim of beneficial ownership and a statement that such person intends to
continue to hold the shares through the date of the meeting, (c) notifies the
Company of such person's intention to appear personally at the meeting or by a
qualified representative under Delaware law to present such person's proposal
for action, and (d) submits such person's proposal timely. A proposal to be
included in the proxy statement or proxy for the Company's next annual meeting
of stockholders will be submitted timely only if the proposal has been received
at the Company's executive offices at 80 Cabot Court, Hauppauge, New York 11788
no later than January 21, 2011. If the date of such meeting is changed by more
than 30 calendar days from the date such meeting is scheduled to be held under
the Company's By-Laws, or if the proposal is to be presented at any meeting
other than the next annual meeting of stockholders, the proposal must be
received at the Company's principal executive office at a reasonable time before
the solicitation of proxies for such meeting is made.
Even if the foregoing requirements are satisfied, a person may submit only
one proposal of not more than 500 words including any accompanying statement. A
supporting statement is required if requested by the proponent for inclusion in
the proxy materials, and under certain circumstances enumerated in the SEC's
rules relating to the solicitation of proxies. The Company may be entitled to
omit the proposal and any statement in support thereof from its proxy statement
and form of proxy if the foregoing eligibility or procedural requirements are
not met or some other bases such as the proposal deals with a matter relating to
the Company's ordinary business operations.
DELIVERY OF PROXY MATERIALS TO HOUSEHOLDS
As permitted by applicable law, only one copy of this proxy statement and
annual report is being delivered to stockholders residing at the same address,
unless such stockholders have notified the Company of their desire to receive
multiple copies of this proxy statement or the Company's annual report.
The Company will promptly deliver, upon oral or written request, a separate copy
of this proxy statement and/or the Company's annual report to any stockholder
residing at an address to which only one copy of either such document was
mailed. Requests for additional copies should be directed to the Company's
Secretary, at the Company's corporate offices at Orbit International Corp., 80
Cabot Court, Hauppauge, New York 11788, or by telephone at (631) 435-8300.
Stockholders who share an address can request the delivery of separate copies of
future proxy statements or the Company's annual report upon written request
which should be directed to the Company's Secretary, at the Company's corporate
offices at Orbit International Corp., 80 Cabot Court, Hauppauge, New York 11788
or by telephone at (631) 435-8300.
Stockholders who share an address can request the delivery of a single copy of
this proxy statement or a single copy of the Company's annual report upon
written request. Such request should be directed to the Company's Secretary, at
the Company's corporate offices at Orbit International Corp., 80 Cabot Court,
Hauppauge, New York 11788 or by telephone at (631) 435-8300.
AVAILABILITY OF PROXY MATERIALS
The Notice of Annual Meeting, Proxy Statement, and Annual Report on Form 10-K
for the fiscal year ended December 31, 2009, are available atwww.Orbitintl.com.
Instead of receiving future copies of our Notice of Annual Meeting, Proxy
Statement, and Annual Report on Form 10-K by mail, shareowners of record and
most beneficial owners can elect to receive an e-mail that will provide
electronic links to these documents. Opting to receive your proxy materials
online will save us the cost of producing and mailing documents to your home or
business, and also will give you an electronic link to the proxy voting site.
OTHER MATTERS
The Board of Directors is not aware of any other matter other than those
set forth in this proxy statement that will be presented for action at the
meeting. If other matters properly come before the meeting, the persons named
as proxies intend to vote the shares they represent in accordance with their
best judgment in the interest of the Company.
THE COMPANY UNDERTAKES TO PROVIDE ITS STOCKHOLDERS WITHOUT CHARGE A COPY OF THE
COMPANY'S ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES FILED THEREWITH. WRITTEN REQUESTS FOR SUCH REPORT SHOULD BE ADDRESSED
TO THE OFFICE OF THE SECRETARY, ORBIT INTERNATIONAL CORP., 80 CABOT COURT,
HAUPPAUGE, NEW YORK 11788.
ORBIT INTERNATIONAL CORP.
ANNUAL MEETING OF STOCKHOLDERS - JUNE 18, 2010
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned stockholder in Orbit International Corp. (the "Corporation")
hereby constitutes and appoints Dennis Sunshine, Bruce Reissman, and Mitchell
Binder, and each of them, his/her/its true and lawful attorneys and proxies,
with full power of substitution in and for each of them, to vote all shares of
the Corporation that the undersigned is entitled to vote at the Annual Meeting
of Stockholders to be held at the Sheraton Long Island, 110 Vanderbilt Motor
Parkway, Smithtown, New York 11788, on Friday, June 18, 2010, at 10:00 a.m.,
Eastern Daylight Savings Time, or at any postponement or adjournment thereof, on
any and all of the proposals contained in the Notice of the Annual Meeting of
Stockholders, with all the powers the undersigned would possess if present
personally at said meeting, or at any postponement or adjournment thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE NOMINEES LISTED ON THE REVERSE SIDE FOR DIRECTORS AND FOR PROPOSAL 2.
(Continued and to be signed and dated on the other side)
[X] Please mark
your votes
as this
example
THE DIRECTORS RECOMMEND A VOTE FOR PROPOSAL 1
1. Election of Directors FOR All nominees WITHHOLD AUTHORITY
listed (except as marked to vote for all
to the contrary, see nominees listed
instruction below) at left
Dennis Sunshine, Bruce Reissman,
Mitchell Binder, Bernard Karcinell,
Lee Feinberg, Sohail Malad
and Fredric Gruder [ ] [ ]
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE, DRAW A LINE THROUGH THE NAME OF THE NOMINEE ABOVE.
THE DIRECTORS RECOMMEND A VOTE FOR PROPOSAL 2
2. Proposal to ratify Amper, Politziner &
Mattia, LLP as independent auditors. For Against Abstain
[ ] [ ] [ ]
3. The above named proxies are granted the authority, in their discretion,
to act upon such other matters as may properly come before the
meeting or any postponement or adjournment thereof.
Dated , 2010
Signature(s)______________________
Signature(s)______________________
Please sign exactly as your name appears on the stock certificate and return
this proxy immediately in the enclosed stamped self-addressed envelope.