DCI Telecommunications, Inc.
611 Access Road
Stratford, CT 06497
NOTICE OF ANNUAL MEETING OF THE SHAREHOLDERS
TO BE HELD
July 24, 1997
at
Sheraton Bradley International Airport Hotel
1 Bradley International Airport
Windsor Locks, Connecticut 06096
To The Shareholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of the
shareholders of DCI Telecommunications, Inc. (the "Company")
will be held at the Sheraton Bradley International Airport
Hotel, Windsor Locks, Connecticut on July 24, 1997 at 9:00
a.m. local time to hear a report on the condition of the
Company from the Chief Executive Officer of the Company and
to vote on the following proposals recommended by the Board
of Directors for approval:
(1) To elect eight directors to serve until the next Annual
Meeting of shareholders
(2) To ratify the selection of Schnitzer & Kondub,
Certified Public Accountants, as the Company's independent
public accountants for the coming year
(3) To transact such other business as may properly come
before the meeting
The Board of Directors has fixed the close of business on
June 11, 1997 as the record date for the determination of
shareholders entitled to notice of and to vote at the
meeting. Only holders of the Company's common stock at the
close of business on the record date are entitled to vote at
the meeting.
Adoption of the proposals will require the affirmative vote
of a majority of the Common Stock voting on the proposal.
You are cordially invited to attend the meeting in person.
However, whether you plan to attend or not, we urge you to
complete, date, sign, and return the enclosed proxy promptly
in order that as many shares as possible may be represented
at the meeting.
A copy of the Company's Annual Report to Stockholders is
enclosed.
BY ORDER OF THE BOARD OF DIRECTORS
_______________________________________
Joseph J. Murphy, President
Fairfield, Connecticut
June 20, 1997
DCI Telecommunications
611 Access Road
Stratford, CT 06497
Annual Meeting - July 24, 1997
June 20, 1997
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of
shareholders of DCI Telecommunications, Inc. to be held on
Thursday July 24, 1997 at 9:00 a.m., at the Sheraton Bradley
International Airport Hotel, Windsor Locks, Connecticut
06096.
In addition to the specific matters to be voted on at the
meeting, there will be a report on the Company's business
and an opportunity for shareholders to ask questions. I
hope you will be able to join us. If you are unable to
attend, I strongly urge you to complete your enclosed proxy.
Your vote is very important.
Sincerely,
Joseph J. Murphy
President
DCI Telecommunications, Inc.
Proxy Statement for Annual Meeting of Shareholders
Information concerning Solicitation and Voting
General
The enclosed Proxy is solicited on behalf of DCI
Telecommunications, Inc. (the "Company")for use at the
Annual Meeting of shareholders to be held Thursday, July 24,
1997 at 9:00a.m. local time for the purposes set forth
herein and in accompanying Notice of Annual Meeting of
shareholders. The Annual Meeting will be held at the
Sheraton Bradley International Airport Hotel, Windsor Locks,
Connecticut 06096.
These proxy solicitation materials are being mailed on or
about June 24, 1997 together with the Company's Annual
Report to all shareholders entitled to vote at the meeting.
Record Date and Principal Stockholders
Holders of record of Common Stock at the close of business
on June 11, 1997 are entitled to notice of and to vote at
the meeting. There are no other outstanding voting
securities of the Company. At the record date, 9,227,961
shares of the Company's Common Stock were issued and
outstanding. The following table sets forth, as of the most
recent practical date (June 11, 1997), those persons known
to the Company to be the beneficial owners of more than 5%
of the Company's Common Stock:
Amount and Nature Percent of
Name of Beneficial Ownership Class
Joseph J. Murphy 1,530,0191 14.2%
Robert Muller 1,298,0002 12.1%
1- Included in shares owned above are 600,000 shares which
the beneficial owner has the right to acquire from options
within sixty days.
2- Includes 1,200,000 shares to be issued upon completion
of the acquisition of Muller Media.
Section 16(a) Reports
Section 16(a) of the Securities Exchange Act of 1934 (the
"34 Act") requires the Company's officers and directors,
and persons who own more than 10% of a registered class of
the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and
Exchange Commission (the "SEC"). Officers, directors and
greater than 10% stockholders are required by certain
regulations to furnish the Company with copies of all
Section 16(a) forms they file.
Based solely on its review of the copies of such forms
received by it, the Company believes that during its most
recent fiscal year or prior fiscal years, all filing
requirements applicable to its officers, directors, and
greater than 10% beneficial owners were complied with.
Revocability of Proxies
Any proxy given pursuant to this solicitation may be revoked
by the person giving it at any time before its use by
delivering to the Company a written notice of revocation or
duly executed proxy bearing a later date or by attending the
meeting and voting in person.
Voting and Solicitation
In accordance with the Company's by-laws, directors shall be
elected by the affirmative vote a plurality of the votes
cast in person or by proxy by the holders of shares entitled
to vote in election at the Annual Meeting of shareholders,
and the ratification of Schnitzer and Kondub as independent
auditors shall be by the affirmative vote of the majority of
the shares voting on the proposal in person or by proxy at
the Annual Meeting; in each case, provided a quorum is
present. Thus, abstentions and broker non-votes will not be
included in vote totals and will have no effect on the
outcome of the vote. No stockholder shall be entitled to
cumulate votes.
The cost of soliciting proxies will be borne by the Company.
Proxies may be solicited by certain of the Company's
directors, officers and regular employees, without
additional compensation, personally or by telephone,
telegram or letter. Also, the Company has engaged Morrow &
Co. to provide certain services in connection with the
solicitation of the proxies.
Deadline for Receipt of Stockholder Proposals
Proposals of stockholders of the Company which are intended
to be presented by such stockholders at next year's Annual
Meeting must be received by the Company by no later than
March 24, 1998 in order that they may be considered for
inclusion in the proxy statement and form of proxy relating
to that meeting.
PROPOSAL NO. 1
NOMINATIONS FOR ELECTION AS DIRECTORS
Nominees
A Board of eight directors is to be elected at the meeting.
Unless otherwise instructed, the proxy holders will vote the
proxies received by them for the Company's eight nominees
named below. In the event that any nominee of the Company
is unable or declines to serve as a director at the time of
the Annual Meeting, the proxies will be voted for any
nominee who shall be designated by the present Board of
directors to fill the vacancy. The Company is not aware of
any nominee who will be unable or decline to serve as a
director. The term of office of each person elected as a
director will continue until the next Annual Meeting of
shareholders or until a successor has been elected and
qualified.
The names of the nominees, and certain information about
them, are set forth below.
Director Amount and Nature Percent of
Name Age Since of Beneficial Ownership(b)* Class
John J. Adams 58 1995 215,312 2.0%
Vice President Marketing DCI Telecommunications, Inc. In
addition, Mr. Adams is Vice President for R&D Scientific
Corp. and founder and President of Validation Services Corp.
These companies are providers of computerized regulatory
compliance devices and services to the pharmaceutical
industry. Mr. Adams was previously President of Prevent
Chemicals, Ltd., a publicly traded manufacturer of specialty
chemicals.
Carter H. Hills 66 1995 252,000 2.3%
Retired diplomat. Extensive experience in economic
development and management planning under auspices of
Department of State and major international organizations.
Directed such programs in countries of Near East and
Vietnam. Served as financial adviser and delegate for U.S.
at key international conferences.
Joseph J. Murphy 58 1995 1,530,019 14.2%
President and CEO of DCI Telecommunications. Prior to that
he was executive vice president, member of the Board of
Directors, and chief financial officer for Aquarion, a New
York Stock Exchange Company. Formerly, he was an officer in
the United States Marine Corps (1961-64), a member of Price
Waterhouse and chief financial officer for Connecticut
Energy Corp. He was a member of the Board of Directors of
Boys/Girls Club of Bridgeport and served on the Economic
advisory board for Fairfield University and Sudden Death
Syndrome (SIDS) for Fairfield County. Presently, he is a
member of the FBI/Marine Corps Association.
Larry Shatsoff 43 1995 442,150 4.1%
Vice President and Chief Operations Officer of DCI
Telecommunications. Within the past five years he has been
vice president and chief operations officer for Alpha
Products. Prior to that, he was executive vice president of
Kalon Systems (a data processing services company), manager
of information systems for Aquarion, a New York Stock
Exchange Company. Expertise in required tariffs,
telecommunications and computer systems software.
Richard Sheppard 51 1995 355,625(a) 3.3%
President of R&D Scientific since its inception in 1989.
Prior to that he was national sales manager for Automated
Microbiology Systems, Inc. and DMS Labs, a Division of API
Systems S.A. He was also a partner in Celltron Corp., where
he developed a DNA sequencer, for cellular identification.
Just prior to forming R&D Scientific, he participated in the
development of industrial application software.
Paul Bettencourt 50 1996 6,897 .1%
President of Privilege Enterprises Limited. Has 25 years of
experience in new business development, marketing plan
creation, and sales management. He has conducted numerous
industrial training programs for both established and new
business. Mr. Bettencourt is advisor to the American Hotel
and Motel Association and a publishing consultant to
segments of the Defense Department.
Lois S. Morris 46 1997 14,706 .1%
Lois S. Morris is Chief Executive Officer of The Travel
Source Limited. She has 25 years experience in the travel
industry in direct sales, conference planning, incentive
groups, special interest groups and direct marketing. Ms.
Morris in on the Board of Directors of the Ocean State
Business School, a member of the Town of Richmond, Rhode
Island Economic Development commission and a volunteer for
the Educational Mentor Program in Rhode Island.
Donald Mactaggart 59 1997 200,000 1.9%
CEO of CyberFax. Prior to creating CyberFax he was an ITU
Associate Rapporteur for G3 facsimile, and helped Unitel
launch the first fax-specific long distance service. He
also founded Textran, Canada's first dedicated provider of
enhanced telecommunications services. Mr. Mactaggart is
currently a member of the Order of Engineers of Quebec.
All directors and executive
officers as a group 3,016,709(b) 28.1%
Notes:
(a) Includes 95,625 shares upon completion of acquisition
of R&D Scientific
(b) Included in shares owned above are shares which the
beneficial owner has the right to acquire from options
within sixty days as follows: J. Murphy, 600,000 shares; L.
Shatsoff, 350,000 shares; R. Sheppard, 260,000 shares; J.
Adams, 185,000 shares; C. Hills, 100,000 shares
* Shares beneficially owned directly or indirectly
The Board of directors urges stockholders to vote "FOR" each
of the nominees for directors set forth above.
PROPOSAL NO. 2
RATIFICATION OF SELECTION OF CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors of the Company has selected Schnitzer
& Kondub, 575 White Plains Road Eastchester, NY 10709 as its
independent public accountants for 1998. In accordance with
a resolution of the Board of Directors, this selection is
being presented to shareholders for ratification at the
Annual Meeting.
If the foregoing proposal is not approved by the
shareholders or if, prior to the 1997 Meeting, Schnitzer &
Kondub shall decline to act or otherwise become incapable of
acting, or if its employment shall be otherwise discontinued
by the Board of Directors, then the Board of Directors will
appoint other independent public accountants whose
employment for any period subsequent to the 1997 Annual
Meeting will be subject to ratification by the shareholders
at the meeting.
The Company has been advised that representatives of
Schnitzer & Kondub will be present at the meeting with the
opportunity to make a statement if they desire to do so and
will be available to respond to appropriate questions.
Schnitzer & Kondub audited the Company's financial
statements for the years ended March 31, 1995, 1996 and
1997.
The Board of Directors recommends a vote "FOR" ratification
of the selection of Schnitzer & Kondub as independent
accountants.
Board Meetings and Committees
The Board of Directors of the Company held ten meetings
during the period April 1, 1996 to March 31, 1997. All of
the then incumbent directors attended such meetings except
for Paul Bettencourt. Mr. Bettencourt missed four meetings
during the period which he was appointed a director.
In January, 1995 the Board of Directors established a
Compensation Committee, a Nomination Committee and a Finance
Committee. Larry Shatsoff is chairman of the Compensation
Committee, Joseph J. Murphy is the chairmen of the
Nomination Committee and the Finance Committee chairman is
Carter H. Hills. All three committees met once during the
year ended March 31, 1997.
Employment Agreements
The Company entered into an employment agreement dated as of
January 1, 1995 with Joseph J. Murphy pursuant to which Mr.
Murphy renders services to the Company as its President and
Chief Executive Officer for an annual base salary of
$100,000.
The Company also entered into an employment agreement dated
January 1, 1995 with Larry Shatsoff pursuant to which Mr.
Shatsoff renders services to the Company as its Vice
President and Chief Operating Officer, for an annual base
salary of $90,000.
The Company also entered into an employment agreement dated
April 9, 1997 with Donald Mactaggart pursuant to which Mr.
Mactaggart renders services to CyberFax, a subsidiary of the
Company, as its CEO, for an annual base salary of $60,000.
The Company also entered into an employment agreement dated
April 9, 1997 with Claude Dominique pursuant to which Mr.
Dominique renders services to CyberFax, a subsidiary of the
Company, as its President, for an annual base salary of
$60,000.
The Company also entered into an employment agreement dated
March 25, 1997 with Lois S. Morris pursuant to which Ms.
Morris renders services to The Travel Source, a subsidiary
of the Company, as its CEO, for an annual base salary of
$39,000.
The Company also entered into an employment agreement dated
March 25, 1997 with Sandra J. Perry pursuant to which Ms.
Perry renders services to The Travel Source, a subsidiary of
the Company, as its President, for an annual base salary of
$39,000.
Executive Compensation and Compensation of Directors
The following tables set forth for the fiscal year ended
March 31, 1997, certain information regarding the total
remuneration paid and grants of options/SARs made to the
chief executive officer and each of the executive officers
of the Company and its subsidiaries and who received total
cash compensation in excess of $100,000 during the period.
These amounts reflect total cash compensation paid by the
Company and its subsidiaries to these individuals during the
fiscal years March 31, 1997, 1996, and 1995.
Summary Compensation Table
Long-Term Compensation
Awards Payouts
Securities
Annual Compensation Underlying All Other
Name and Salary Other Annual Options/SARs Compensation
Principal Positions Year ($) Compensation (#) ($)
Joseph J. Murphy 1995 100,000 -
President, CEO, 1996 100,000 5,872
Chairman and 1997 100,000 600,000
Director
Aggregated Options /SAR Exercised in Last Fiscal Year
and FY-End Option/SAR Values
Value of
Unexercised
Number of In-the-Money
Unexercised Options/SARs
at FY-End (#) at FY-End ($)
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise (#) Realized ($) Unexercisable Unexercisable
Joseph J. Murphy - - 600,000 $2,287,500
Option/SAR Grants in Last Fiscal Year
% of Total
Options/SARS
Granted to Exercise
Options/SARs Employees or Base
Name Granted (#) in Fiscal Year Price ($/Sh) Expiration Date
Joseph J. Murphy 600,000 17.4 $.1875 4/12/01
The Company's current policy is to pay outside directors
(non-executive officers) who are not contractually entitled
to be nominated to serve as directors, annual fees of 70
shares of Common Stock.
Other Matters
The Company knows of no other matters to be submitted to the
meeting. If any other matters properly come before the
meeting, it is the intention of the persons named in the
enclosed proxy to vote the shares they represent as the
Board of Directors may recommend.
It is important that your shares be represented at the
meeting, regardless of the number of shares you hold. You
are, therefore, urged to execute and return, at your
earliest convenience, the accompanying proxy card in the
stamped, self-addressed envelope which has been enclosed.
By Order of the Board of Directors
Dated: June 20, 1997