ADVANCED REMOTE COMMUNICATION SOLUTIONS, INC.
(Formerly Boatracs, Inc.)
10675 Sorrento Valley Road, Suite 200
San Diego, California 92121
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
TO BE HELD ON MAY 16, 2001
The Annual Meeting of the Shareholders ("Annual Meeting") of Advanced
Remote Communication Solutions, Inc., a California corporation ("ARCOMS" or
the "Company"), will be held at the corporate office of the Company's
subsidiary, Enerdyne Technologies, Inc., 1935 Cordell Court, El Cajon,
California 92020 on May 16, 2001, at 10:00 a.m. for the following purposes:
1. To elect five directors of the Company, all of whom shall serve until the
2002 Annual Meeting of Shareholders and until the election and qualification
of their successors);
2. To consider and act upon any other matters which may properly come before the
Annual Meeting and any adjournment thereof.
The Board of Directors has fixed the close of business on March 19, 2001 as the
record date for the determination of the holders of the Company's capital stock
entitled to notice of and to vote at the Annual Meeting.
All shareholders are cordially invited to attend the Annual Meeting in person.
Regardless of whether you plan to attend the Annual Meeting, please sign and
date the enclosed Proxy and return it as promptly as possible in the enclosed
pre-addressed and postage paid envelope. The prompt return of Proxies will
ensure a quorum and save the Company the expense of further solicitation. Any
shareholder returning the enclosed Proxy may revoke it prior to its exercise by
voting in person at the Annual Meeting or by filing with the Secretary of the
Company a written revocation or duly executed Proxy bearing a later date.
By Order of the Board of Directors,
Michael Silverman
Chairman
San Diego, California
April 9, 2001
Advanced Remote Communication Solutions, Inc.
10675 Sorrento Valley Road, Suite 200
San Diego, California 92121
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 16, 2001
I. PROXIES
This Proxy Statement is furnished in connection with the solicitation of proxies
by or on behalf of the Board of Directors ("Board") of Advanced Remote
Communication Solutions, Inc., a California corporation (the "Company"), for use
at the Company's 2001 Annual Meeting of Shareholders to be held on May 16, 2001
at the corporate office of the Company's subsidiary, Enerdyne Technologies,
Inc., 1935 Cordell Court, El Cajon, California 92020 at 10:00 a.m., and at any
and all adjournments thereof (the "Annual Meeting"), for the purposes set forth
in the accompanying Notice of Annual Meeting of Shareholders.
Any shareholder may revoke his or her proxy by delivering written notice of
revocation to the Secretary of the Company at its principal office, 10675
Sorrento Valley Road, Suite 200, San Diego, California 92121, by a delivery of
proxy bearing a later date, or by attendance at the Annual Meeting and voting in
person.
This Proxy Statement and the Annual Report of the Company for the year ended
December 31, 2000 will be mailed on or about April 9, 2001, to each shareholder
of record as of the close of business on March 19, 2001.
The solicitation of proxies is being made by use of the mails. The cost of
preparing, assembling and mailing these proxy materials will be paid by the
Company. Following the mailing of this Proxy Statement, directors, officers and
regular employees of the Company may solicit proxies by mail, telephone,
telegraph or personal interview. Such persons will receive no additional
compensation for such services. Brokerage houses and other nominees, fiduciaries
and custodians nominally holding shares of the Company's capital stock of record
will be requested to forward proxy soliciting material to the beneficial owners
of the shares, and will be reimbursed by the Company for their reasonable out-of
pocket expenses incurred in forwarding these materials.
When your proxy is returned properly signed, the shares represented will be
voted in accordance with your directions. Where specific choices are not
indicated, proxies will be voted in favor of the five persons nominated to be
directors in Proposal One. If a proxy indicates that a shareholder or nominee
abstains from voting or that shares are not to be voted on a particular
proposal, the shares will not be counted as having been voted on that proposal,
and those shares will not be reflected in the final tally of the votes cast with
regard to that proposal, although such shares will be counted as in attendance
at the Annual Meeting for purposes of determining a quorum. Additionally, broker
non-votes are not counted as votes cast on any matter to which they relate.
The presence at the Annual Meeting in person or by proxy of the holders of a
majority of the shares of capital stock(1) entitled to vote at the Annual
Meeting is necessary to constitute a quorum for the transaction of business.
- ------------------------
(1) Capital stock - Capital stock when used in this Proxy refers to 21,090,922
shares of no par value Common Stock and 376 shares of Series B Preferred Stock
("Preferred") which are entitled to vote 1,457,691 shares on an "as converted"
basis as set forth in the Company's Articles of Incorporation.
Holders of common stock are entitled to one vote per share and holders of
Preferred are entitled to vote shares on an "as converted" basis as set forth in
the Company's Articles of Incorporation on matters brought before the Annual
Meeting and to cumulate votes for the election of directors. A shareholder may
not cumulate votes unless the shareholder has announced at the Annual Meeting
the intention to do so before the voting has begun, but if any shareholder makes
such an announcement, all shareholders may cumulate votes. Cumulative voting
rights entitle a shareholder to give one nominee as many votes as are equal to
the number of directors to be elected, multiplied by the number of shares owned
by the shareholder, or to distribute his or her votes as the shareholder sees
fit among two or more nominees on the same principle, up to the total number of
nominees to be elected. The five nominees for director receiving the highest
number of votes at the Annual Meeting from the holders of capital stock will be
elected.
Directors and officers beneficially own approximately 45% of the outstanding
shares of capital stock. The directors and officers have indicated that they
intend to vote for each of the nominees for director.
The Company had 21,090,922 shares of common stock outstanding at the close of
business on March 19, 2001 and the holders of 376 shares of Preferred are
entitled to vote 1,457,691 shares on an "as converted" basis as set forth in the
Company's Articles of Incorporation. Holders of record of shares of the capital
stock at the close of business on March 19, 2001 will be entitled to notice of
and to vote at the Annual Meeting. Holders of Preferred will be entitled to
notice of and to vote the number of shares as set forth in the Company's
Articles of Incorporation at the Annual Meeting.
II. Securities Ownership of Certain Beneficial Owners and Management
Set forth below is certain information concerning the ownership of the Company's
capital stock as of March 19, 2001 by (i) all persons known to the Company to be
beneficial owners of more than 5% of the outstanding capital stock, (ii) each
director and nominee for director of the Company, (iii) each executive officer
of the Company, and (iv) all executive officers and directors of the Company as
a group. Except as otherwise indicated, and subject to applicable community
property and similar laws, the persons named have sole voting and investment
power with respect to the securities owned by them.
Name and Address Number of Common Shares Percent of
of Shareholder(1) Beneficially Owned Outstanding Capital Stock
- -------------- ------------------ -------------------------
QUALCOMM Incorporated 1,172,265 5%
5775 Moorehouse Drive
San Diego, CA 92121
Irene Shinsato 2,373,075 (2) 10
Michael L. Silverman 3,544,837 15
Jon S. Gilbert 3,258,300 (3) 14
Giles H. Bateman 725,158 3
Mitchell G. Lynn 166,832(4) *
Scott T. Boden 2,373,075 (5) 10
Mohammed G. Abutaleb 551,125(6) 2
John Major 0
Andrew Werth 0
Dean Kernus 15,000 *
Charles J. Drobny, Jr. 267,006(7) 1
John R. Westgarth (8) 0
All Directors and
Executive
Officers as a group
(11 persons) (9) 10,901,333 45%
- ---------------------
(1) The address for all directors and executive officers is 10675 Sorrento
Valley Road, Suite 200,
San Diego, California 92121.
(2) Includes 244,225 warrants and 663,500 options. All the securities are
in trusts for which Ms. Shinsato is a trustee.
(3) Shares are held in a family trust of which Mr. Gilbert is a trustee.
(4) Includes 20,000 shares held in trust for children for which Mr. Lynn
disclaims beneficial ownership. The number also includes 50,000 options
issued under a Non-Circumvention Agreement dated January 9, 1996
exercisable at $1.50 per share.
(5) Includes 244,225 warrants and 663,500 options. The shares are held in
family trusts for which Mr. Boden is
a trustee, excepting for 100,000 warrants which are held in trust
for minor children. Mr. Boden is not a
trustee of this trust and disclaims beneficial ownership.
(6) Shares were issued in connection with the Company's acquisition of
Innovative Communications Technologies, Inc. effective August 1999.
(7) 240,000 of the shares are represented by restricted stock granted under
an agreement and the remaining 27,006 shares were issued under the
terms of an employment agreement.
(8) Mr. Westgarth joined the Company in January 2001.
(9) Includes shares issuable upon the exercise of options and warrants
within sixty days of March 19, 2001 as follows:
Mr. Silverman 100,000 shares
Mr. Bateman 61,333
Mr. Lynn 49,332
Mr. Abutaleb 10,000
Mr. Kernus 15,000
* Less than 1%
III. Election Of Directors (Proposal No. 1 on Proxy Card)
The persons named below have been nominated by management for election as
directors of the Company to serve until the 2002 Annual Meeting of Shareholders
or until their respective successors are duly elected and qualify.
Unless otherwise instructed, the enclosed proxy will be voted for election of
the nominees listed below, except that the persons designated as proxies reserve
full discretion to cast their votes for another person recommended by management
in the unanticipated event that any nominee is unable to or declines to serve.
The Board has no reason to believe that any nominee will be unable or unwilling
to serve.
Name of Nominee Age Position with the Company
Michael L. Silverman 56 Chairman, Director,
President, Chief Executive Officer
Scott T. Boden 39 Director
Mohammed G. Abutaleb 43 Director, President, Innovative
Communications
Technologies, Inc.
John Major 55 Director
Andrew M. Werth 67 Director
Mr. Silverman formed Boatracs, Inc. in 1990 ("Old Boatracs") and served as
its Chairman, Chief Executive Officer, President and a director of that
company from its inception until the merger of Old Boatracs with the Company
(the "Merger") on January 12, 1995, at which time he assumed the same positions
with the Company. Mr. Silverman served the Company as President and Chief
Executive Officer from the date of the Merger until October 1997 and again
from November 1999 to the present date. He continues to serve as Chairman.
Since January 2001, Mr. Silverman has served as a director of S.V.I. Holdings,
Inc., a publicly traded retail software company. Mr. Silverman is a
Chartered Accountant (South Africa) and received a Master of Business
Administration degree from Stanford University.
Mr. Boden was appointed a director in September 1998. Mr. Boden founded Enerdyne
Technologies, Inc. ("Enerdyne") in 1984 and was its Chief Executive Officer
and Chief Technology Officer until July 1998, when the Company acquir
products for Cinematroncis, Inc. Mr. Boden attended San Diego State
University. He served as Chief Technology Officer of Enerdyne from July
1998 until he resigned in January 2001.
Mr. Abutaleb joined the Company in September 1999 upon the merger of
Innovative Communications Technologies, Inc.("ICTI") and the Company. Mr.
Abutaleb co-founded ICTI in 1989. Previously, Mr. Abutaleb was employed by
COMSAT Corporation and Fairchild Industries. While working for these
companies, he held technical and technical management
positions. Mr. Abutaleb received a Master of Science degree in Electrical
Engineering from the University of Maryland with an emphasis in
communications and semiconductor physics. He was appointed a director of the
Company in November 1999.
Mr. Major has been Chief Executive Officer of Novatel Wireless, Inc. since July
2000. Previously he was Chief Executive Officer of Wireless Internet Solutions
Group and was President and Chief Executive Officer of Wireless Knowledge, a
QUALCOMM and Microsoft joint venture, which he joined in November 1998. Prior to
joining Wireless Knowledge, Mr. Major served as Corporate Executive Vice
President of QUALCOMM and president of its Wireless Infrastructure Division. Mr.
Major held several executive positions at Motorola, including Chief Technology
Officer, from 1977 until 1997 when he joined QUALCOMM. He received a Bachelor of
Science degree in Mechanical and Aerospace Engineering from the University of
Rochester, a Master of Science in Mechanical Engineering from the University of
Illinois, a Master of Business Administration degree from Northwestern
University, and a Juris Doctorate degree from Loyola University.
Mr. Werth is a partner of Washington Advisory Group, a Washington D.C.
consulting company, and is on the Advisory Council of Hughes Network Systems
("HNS"). He also serves as Chairman of the Board of the Global VSAT Forum, an
industry association promoting the welfare of the VSAT market. Previously, Mr.
Werth was President of Hughes Network Systems International ("HNSI"), a
division of HNS responsible for all international operations. Mr. Werth was a
founder of Digital Communications Corporation, later acquired by HNS.
He holds a Bachelor of Science and Master of Science degree in Electrical
Engineering from Columbia University,
There is no family relationship between any of the Company's directors and
officers. There are no arrangements or understandings between any director or
executive officer and any other person pursuant to which any person has been
elected or nominated as a director or executive officer. All directors and
executive officers serve for a term of one year until the next Annual Meeting of
Shareholders.
During the year ended December 31, 2000, the Board of Directors held eight
meetings where all directors were present except Mr. Major who did not attend
three meetings. The Company presently has a Compensation Committee of the Board
of Directors consisting of Mitchell Lynn, Chairman, Giles Bateman and Jon
Gilbert. The Compensation Committee's primary function is to establish
compensation for employees and effect promotions. The Audit Committee of the
Board of Directors, consisting of Giles Bateman, Chairman, and John Major,
advises the Board as to the selection of the Company's independent accountants,
reviews with the independent accountants the accounting principles and practices
followed by the Company and the adequacy thereof, approves the Company's annual
audit and financial results and any material change thereto and makes
recommendations to the Board regarding such matters. The Audit Committee adopted
the "ARCOMS Audit Committee Charter" in 2000, a copy of which is attached as
Exhibit-99. The Board does not have a standing Nominating Committee. During
2000, the Compensation Committee met three times and the Audit Committee met
twice.
Independent Public Accountants
Audit Fees
The aggregate fees billed by the Company's independent accounting firm, Deloitte
& Touche LLP ("Deloitte & Touche") for professional services rendered in
connection with the audit of the Company's annual financial statements for the
year ended December 31, 2000, and for the reviews of the Company's quarterly
financial statements included in its Quarterly Reports on Form 10-QSB for the
year were $78,900.
Information Technology Services
During the year ended December 31, 2000, the Company did not retain the services
of Deloitte & Touche to consult on information technology issues.
All Other Fees
During the year ended December 31, 2000, the Company paid a total of $38,536 in
other fees to Deloitte & Touche including the preparation of the Company's tax
returns.
The Audit Committee has considered whether the provision of nonaudit services is
compatible with maintaining the independence of the Company's principal
accounting firm.
Executive Officers
In addition to those listed above, the following individuals are also executive
officers:
Name Age Position with the Company
Charles J. Drobny, Jr. 50 Chief Operating Officer,
Boatracs Division
Dean B. Kernus 42 Chief Financial Officer, Secretary
John R. Westgarth 36 President, Enerdyne Technologies, Inc.
Mr. Drobny joined the Company effective November 1997 as Vice President,
Application Development when the Company purchased Boatracs Gulfport
("Gulfport"). In June 2000, he became Chief Operating Officer of the
Boatracs division. Mr. Drobny founded Gulfport in September 1993. Prior to
1993, Mr. Drobny was Vice President and General Manager of Genesis Systems in
Bay St. Louis, Mississippi, a manufacturer of marine information systems.
Mr. Kernus joined the Company in February 2000 as Chief Financial Officer.
Prior to joining the Company, Mr. Kernus was Vice President of Corporate
and Project Accounting for SeaWest WindPower, Inc., and an Audit Manager
with McGladrey and Pullen, LLP and with PricewaterhouseCoopers. His experience
includes mergers and acquisitions and business development. In public
accounting, Mr. Kernus concentrated on high technology and real estate
companies. Mr. Kernus holds a Bachelor of Science degree in Economics from the
Wharton School of the University of Pennsylvania and is a Certified Public
Accountant.
Mr. Westgarth joined the Company in January 2001 as President of Enerdyne. From
1999 to January 2000, Mr. Westgarth was a marketing and strategy consultant for
a number of high-tech technology companies. From 1998 to 1999, he was Vice
President of Marketing at Gyyr Inc., a division of Odetics Corporation. From
1995 to 1998, Mr. Westgarth held the position of Vice President of Marketing of
CBS Corporation (formerly Westinghouse Electric Corporation). Mr. Westgarth
holds a Bachelor of Science degree in Business Administration from California
Polytechnic State University and holds both a Master in Business Administration
degree and a Master of Arts degree in Asian Studies from Cornell University.
IV. Executive Compensation
Executive Compensation
The following table sets forth for the years indicated certain compensation of
the Company's Chairman and the persons occupying the office of Chief Executive
Officer and the Company's executive officers of the Company who actually earned
or who were paid on a basis of more than $100,000 in salary and bonuses in such
years.
SUMMARY COMPENSATION TABLE
No. of shares
Annual Other underlying
Principal Position Year Salary Compensation Options
(1)
Michael L. Silverman 2000 $141,101 $2,625
Chairman, CEO & 1999 120,242 1,615 200,000
President (2) 1998 115,368
Charles J. Drobny,
Jr.(3) 2000 $185,671 $2,626
Chief Operating
Officer, 1999 153,997 1,320
Boatracs 1998 145,934
Mohammed G. Abutaleb 2000 $120,000 $2,700 100,000
President, ICTI (4) 1999 50,000 50,000
Scott T. Boden 2000 $120,000 $2,733
Chief Technology 1999 120,000 1,984
Officer, Enerdyne (5) 1998 60,000
Dean B. Kernus (6) 2000 $94,811 $2,733 125,000
Chief Financial Officer
- ----------------
(1) Other compensation represents the Company match to the 401k plan. The 401k
plan commenced in April 1999.
(2) Mr. Silverman has been the President and Chief Executive Officer of the
Company since November 1999 and previously from inception until October 1997.
His current annual salary is $180,000. He also serves as Chairman of the Board
of Directors. The Company entered into an employment agreement with Mr.
Silverman effective January 1, 1995. Under the agreement, Mr. Silverman's annual
base compensation was $100,000 subject to increases at the Board's discretion.
The employment agreement automatically renews for successive one-year periods
unless terminated, and is terminable by the Company at any time for good cause
as defined in the agreement.
(3) Mr. Drobny became Vice President effective November 1, 1997 when the Company
acquired Boatracs Gulfport ("Gulfport"). In connection with the Company's
purchase of Gulfport in November 1997, the Company entered into a four-year
employment agreement with Mr. Drobny. Under the terms of the employment
agreement, Mr. Drobny was paid base compensation of $150,000 for two years
commencing November 1, 1997 and $180,000 for the following two years. Mr. Drobny
may receive, at his election, up to $30,000 per year in the form of shares of
the Company's common stock for the first two years, and up to $60,000 per year
in the form of shares of common stock for the second two years. The salary shown
for 2000, 1999 and 1998 above includes $30,000 which Mr. Drobny has deferred in
salary to purchase Company stock. In June 2000, Mr. Drobny became Chief
Operating Officer of the Boatracs division.
(4) Mr. Abutaleb joined the Company as President of ICTI in September 1999
as a consequence of the acquisition of his company, ICTI.
(5) Mr. Boden resigned as an employee of the Company in January 2001. He
continues to serve as a director.
(6) Mr. Kernus joined the Company in February 2000.
The following table sets forth the information concerning individual grants of
stock options and appreciation rights during the last fiscal year to the
Company's Chief Executive Officer and the executive officers of the Company who
earned more than $100,000 last year.
OPTION GRANTS IN LAST FISCAL YEAR Potential Realizable
(Individual Grants) Value at Assumed
Number Percent of Annual Rates of
of Securities Total Options Stock Price Appreci-
Underlying Granted to Exercise ation for Option (1)
Options Employees in Price Expira- term
Name Granted # Fiscal year ($/Share) tion 5% 10%
- ---- --------- ----------- --------- ---- -- ---
Michael Silverman 0
Charles J. Drobny 0
Mohammed G. Abutaleb 100,000 10% $1.22 2007 $49,666 $115,743
Scott T. Boden 0
Dean B. Kernus 75,000 13% $2.69 2007 $82,133 $191,404
50,000 $1.22 2007 $24,833 $57,872
(1) Potential gains are net of exercise price, but before taxes associated with
exercise. These amounts represent certain assumed rates of appreciation only, in
accordance with the Securities and Exchange Commission's rules. Actual gains, if
any, on stock option exercises are dependent on the future performance of the
common stock, overall market conditions and the option holders continued
employment through the vesting period. The amounts reflected in this table may
not necessarily be achieved.
The following table sets forth the information concerning each exercise of stock
options during the last fiscal year by the Company's Chief Executive Officer and
the executive officers of the Company who earned more than $100,000 last year,
and the fiscal year end value of unexercised options.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
Number Of
Securities Value Of
Underlying Unexercised
Shares Unexercised In-The-Money
Acquired Options Options
On Value At FY-End At FY-End
Exercise Realized Exercisable/ Exercisable/
--------
Name ($) Unexercisable Unexercisable
- ---- --- ------------- -------------
Michael L.Silverman 0 0 50,000/150,000 $0/$0
Charles J. Drobny, Jr. n/a
Mohammed G. Abutaleb 0 0 10,000/140,000 $0/$0
Scott T. Boden n/a
Dean B. Kernus 0 0 0/125,000 $0/$0
Compensation Committee Interlock and Insider Participation
During fiscal year 2000, Michael Silverman, an officer and director of the
Company, attended Compensation Committee meetings concerning executive officer
compensation.
Director Compensation
Through May 1998, non-employee directors of the Company received $500 for each
Board meeting they attended. Non-employee directors currently receive stock
options to purchase common stock of the Company as compensation for Board
meetings. Messrs. Bateman, Lynn, Major, Bernard and Gilbert received 25,000
options to purchase common stock of the Company exercisable at $1.94 in May
2000.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who beneficially own more than 10%
of the Company's stock, to file initial reports of ownership and reports of
changes in ownership with the Securities and Exchange Commission. Executive
officers, directors and greater than 10% beneficial owners are required by
applicable regulations to furnish the Company with copies of all Section 16(a)
forms they file.
Based solely upon a review of the copies of such forms furnished to the Company
and information involving securities transactions of which the Company is aware,
the Company believes that during the year ended December 31, 2000, all its
executive officers, directors and greater than 10% beneficial shareholders
complied with Section 16(a) filing requirements.
REPORT OF THE AUDIT COMMITTEE
The following is the report of the Audit Committee with respect to the Company's
audited financial statements for the year ended December 31, 2000.
The Audit Committee has reviewed and discussed the Company's audited
financial statements with management. The Audit Committee has discussed with
Deloitte & Touche LLP, the Company's independent accountants, the matters
required to be discussed by Statement of Auditing Standards No. 61,
Communication with Audit Committees which includes, among other items, matters
related to the conduct of the audit of the Company's financial statements. The
Audit Committee has also received written disclosures and the letter from
Deloitte & Touche LLP required by Independence Standards Board Standard No. 1,
which relates to the accountant's independence from the Company and its related
entities, and has discussed with Deloitte & Touche LLP their independence from
the Company.
The Audit Committee acts pursuant to the Audit Committee Charter. Each
of the members of the Audit Committee qualifies as an "independent" Director
under the current listing standards of National Association of Securities
Dealers.
Based on the review and discussions referred to above, the Audit
Committee recommended to the Company's Board of Directors that the Company's
audited financial statements be included in the Company's Annual Report on Form
10-KSB for the year ended December 31, 2000.
AUDIT COMMITTEE
Giles Bateman
John Major
V. Certain Transactions
The Company has a number of contractual relationships with QUALCOMM, which owns
1,172,265 shares (5%) of the outstanding common stock.
The Company entered into a License and Distribution Agreement (the "Distribution
Agreement") dated June 13, 1990, which grants the Company certain exclusive
rights to distribute QUALCOMM's OmniTRACS System for marine applications in the
coastal waters of the United States and the Atlantic and Pacific Oceans. This
agreement has been amended from time to time. The agreement has an initial term
of five years and three five-year extensions. The Company exercised its first
two extensions in 1995 and 2000, extending the agreement through 2005.
The Company also entered into a License Agreement with QUALCOMM in March, 1995,
which requires QUALCOMM to pay to the Company a per copy royalty for certain
interface software developed and owned by the Company as an enhancement to the
OmniTRACS System. This agreement terminates upon termination of the Distribution
Agreement.
In September 2000, the Company issued 10,085 shares of common stock to Chuck
Drobny, the Chief Operating Officer of the Boatracs division, under the terms of
an Employment Agreement effective November 1997 and in reliance on Section 4 (2)
of the Securities Act of 1933. The shares were valued at an average price of
$2.97 each.
VII. Date for Submission of Shareholder Proposals - For 2002 Annual Meeting
Any proposal relating to a proper subject which a shareholder may intend to
present for action at the 2002 Annual Meeting of Shareholders and which such
shareholder may wish to have included in the Company's proxy materials for such
meeting must, in accordance with the provisions of Rule 14a-8 promulgated under
the Securities Exchange Act of 1934, be received in proper form by the Company
at its principal executive office not later than December 1, 2001. It is
suggested that any such proposal be submitted by certified mail, return receipt
requested.
VIII. Other Business
Management is not aware of any matters to come before the Annual Meeting other
than those stated in this Proxy Statement. However, inasmuch as matters of which
management is not now aware may come before the Annual Meeting or any
adjournment thereof, the proxies confer discretionary authority with respect to
acting thereon, and the persons named in such proxies intend to vote, act, and
consent in accordance with their best judgment with respect thereto. Upon
receipt of such proxies (in the form enclosed and properly signed) in time for
voting, the shares represented thereby will be voted as indicated thereon and in
this Proxy Statement.
By Order of the Board of Directors,
MICHAEL SILVERMAN, Chairman of the Board
San Diego, California
April 9, 2001
EXHIBIT-99
ADVANCED REMOTE COMMUNICATION SOLUTIONS, INC.
AUDIT COMMITTEE CHARTER
There shall be a committee of the board of directors to be known as the audit
committee. The audit committee shall be composed of directors who are
independent of the management of the corporation and are free of any
relationship that, in the opinion of the board of directors, would interfere
with their exercise of independent judgment as a committee member.
Statement of Purpose
The audit committee shall provide assistance to the corporate directors in
fulfilling their responsibility to the shareholders, potential shareholders, and
investment community relating to corporate accounting, reporting practices of
the corporation, and the quality and integrity of the financial reports of the
corporation. In so doing, it is the responsibility of the audit committee to
maintain free and open means of communication between the directors, the
independent auditors, the internal auditors, and the financial management of the
corporation.
Responsibilities
In carrying out its responsibilities, the audit committee believes its policies
and procedures should remain flexible, in order to best react to changing
conditions and to ensure to the directors and shareholders that the corporate
accounting and reporting practices of the corporation are in accordance with all
requirements and are of the highest quality.
In carrying out these responsibilities, the audit committee will:
o Review and approve management's recommendation of the independent auditors
to be selected to audit the financial statements of the corporation and its
divisions and subsidiaries. Recommend the independent auditors to the board
of directors. The audit committee will also review and approve dismissal of
the independent auditors.
o Meet with the independent auditors and financial management of the
corporation to review the scope of the proposed audit for the current year,
the audit procedures to be utilized, the fee arrangements, and at the
conclusion thereof review such audit, including any comments or
recommendations of the independent auditors.
o Review with the independent auditors and financial and accounting
personnel, the adequacy and effectiveness of the accounting and financial
controls of the corporation, and elicit any recommendations for the
improvement of such internal control procedures or particular areas where
new or more detailed controls or procedures are desirable. Particular
emphasis should be given to the adequacy of such internal controls to
expose any payments, transactions, or procedures that might be deemed
illegal or otherwise improper.
o Review the financial statements contained in the annual report to
shareholders with management and the independent auditors to determine that
the independent auditors are satisfied with the disclosure and content of
the financial statements to be presented to the shareholders. Any changes
in accounting principles should be reviewed.
o Review the quarterly earnings with the company's financial management and
external auditors. Review the quarterly earnings press release.
o Provide sufficient opportunity for the independent auditors to meet with
the members of the Audit Committee without members of management present.
Among the items to be discussed in these meetings are the independent
auditors' evaluation of the corporation's financial, accounting, and
auditing personnel, and the cooperation that the independent auditors
received during the course of the audit.
o Review accounting and financial human resources and succession planning
with the company.
o Submit the minutes of all meetings of the audit committee to, or discuss
the matters discussed at each committee meeting with, the board of
directors.
o Investigate any matter brought to its attention within the scope of its
duties, with the power to retain outside counsel for this purpose if, in
its judgment, that is appropriate.