VERTEX INDUSTRIES, INC.
23 Carol Street
Clifton, New Jersey 07014
NOTICE OF ACTION BY STOCKHOLDERS WITHOUT A MEETING PURSUANT TO
SECTION 14A:5-6(2)(b) OF THE NEW JERSEY BUSINESS CORPORATION ACT
To the Stockholders of Vertex Industries, Inc.:
Notice is hereby given to the holders (the
"Stockholders") of the Common Stock, par value $.005 per
share ("Common Stock") , of Vertex Industries, Inc., a New
Jersey corporation (the "Company") that the Board of
Directors and the holders of a majority of the outstanding
shares of Common Stock have (i) approved an amendment to
the Company's Certificate of Incorporation changing the name
of the Company to Vertex Interactive, Inc., (ii) approved an
amendment to the Company's Certificate of Incorporation to
increase the authorized shares of Common Stock of the
Company from 20,000,000 shares to 32,000,000 shares, and
(iii) approved an amendment to the Company's Amended
Incentive Stock Option Plan to increase the number of shares
of Common Stock available for issuance under the plan from
2,000,000 shares to 4,000,000 shares. (collectively "the Amendments")
The Board of Directors of the Company approved the
Amendments on December 15, 1999. The holders of over a
majority of the outstanding shares of Common Stock approved
the Amendments by written consent in lieu of a meeting, on
December 20, 1999, in accordance with the provisions of
Section 14A:5-6(2) of the New Jersey Business Corporation
Law. Accordingly, your consent is not required and is not
being solicited in connection with this action. Pursuant to
Section 14A:5-6(2) you are hereby being provided with notice
of approval of the Amendments by less than unanimous written
consent of the Company's Stockholders. Pursuant to the
Securities Exchange Act of 1934, as amended, along with this
letter, you are being furnished with an Information
Statement relating to the Amendments.
The record date for determining Stockholders entitled
to receipt of this Notice was December 14, 1999. This notice
is first being mailed to such Stockholders, on or about
January 24, 2000. The Amendments to the Certificate of
Incorporation will not be filed with the Secretary of State
for the State of New Jersey or become effective, and the
Amendment to the Company's Incentive Stock Option Plan will
not become effective, until at least 20 calendar days after such mailing.
By Order of the Board of Directors,
/s/ Nicholas R.H. Toms
Nicholas R.H. Toms
Joint Chairman of the Board of Directors
Joint Chief Executive Officer
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14 (c) of the
Securities Exchange Act of 1934 (Amendment No.)
Check the appropriate box:
[ ] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14c-5 (d)(2))
[ X ] Definitive Information Statement
Vertex Industries, Inc.
(Name of Registrant As Specified In Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules
14c-5(g) and 0-11.
1) Title of each class of securities to which transaction
applies:
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2) Aggregate number of securities to which transaction
applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth
the amount on which the filing fee is calculated and
state how it was determined):
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
4) Proposed maximum aggregate value of transaction:
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
5) Total fee paid:
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided
by Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
1)Amount Previously Paid:
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2)Form, Schedule or Registration Statement No:
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3)Filing Party:
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4)Date Filed:
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VERTEX INDUSTRIES, INC.
23 Carol Street
Clifton, New Jersey 07014
INFORMATION STATEMENT
January 24, 2000
PURSUANT TO SECTION 14c OF THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED, AND RULE 14c AND SCHEDULE 14C THEREUNDER
GENERAL INFORMATION
This Information Statement has been filed with the
Securities and Exchange Commission and is being furnished,
pursuant to Section 14c of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), to the holders (the
"Stockholders") of the common stock, par value $0.005 per
share (the "Common Stock"), of Vertex Industries, Inc., a
New Jersey Corporation (the "Company"), in connection with
(i) an amendment to the Company's Certificate of
Incorporation changing the name of the Company to Vertex
Interactive, Inc., (ii) an amendment to the Company's
Certificate of Incorporation to increase the authorized
shares of Common Stock of the Company from 20,000,000 shares
to 32,000,000 shares, and (iii) an amendment to the
Company's Amended Incentive Stock Option Plan to increase
the number of shares of Common Stock available for issuance
under the plan from 2,000,000 shares to 4,000,000 shares
(collectively "the Amendments").
The Board of Directors of the Company approved the
Amendments subject to Stockholder approval, on December 15,
1999. The holders of a majority of the outstanding shares of
the Common Stock approved the Amendments by written consent
in lieu of a meeting, on December 20, 1999 in accordance
with Section 14A:5-6(2) of the New Jersey Business
Corporation Law. Accordingly, your consent is not required
and is not being solicited in connection with the approval
of the Amendments.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND A PROXY.
The Amendments to the Company's Certificate of
Incorporation will change the name of the Company to Vertex
Interactive, Inc. and will increase the number of authorized
shares of Common Stock from 20,000,000 to 32,000,000 shares.
The form of Certificate of Amendment to be filed with the
New Jersey Secretary of State is attached hereto as Exhibit
A. The Amendment to the Company's Amended Incentive Stock
Option Plan will increase the number of shares reserved for
issuance under the plan from 2,000,000 to 4,000,000.
The entire cost of furnishing this Information
Statement will be borne by the Company. The Company will
request brokerage houses, nominees, custodians, fiduciaries
and other like parties to forward this Information Statement
to the beneficial owners of the Common Stock held of record
by them and will reimburse such persons for their reasonable
charges and expenses in connection therewith. The Board of
Directors has fixed the close of business on December 14,
1999 as the record date (the "Record Date") for the
determination of Stockholders who are entitled to receive
this Information Statement.
You are being provided with this Information Statement
pursuant to Section 14c of the Exchange Act and Rule
14c and Schedule 14C thereunder, and, in accordance
therewith, the Amendments to the Certificate of
Incorporation will not be filed with the Secretary of State
of the State of New Jersey or become effective, and the
Amendment to the Amended Incentive Stock Option Plan will
not become effective, until at least 20 calendar days after
the mailing of this Information Statement.
This Information Statement is being mailed on or about
January 24, 2000 to all Stockholders of record as of the
Record Date.
VOTING SECURITIES
As of the Record Date, the Company had 16,942,921
shares of Common Stock issued and outstanding. Each share of
outstanding Common Stock is entitled to one vote on matters
submitted for Stockholder approval.
On December 20, 1999, the holders of 9,019,466 shares
(or approximately 53.1% of the 16,972,921 shares of Common
Stock then outstanding) executed and delivered to the
Company a written consent approving the Amendments. Since
the Amendments have been approved by the holders of the
required majority of Common Stock, no proxies are being
solicited with this Information Statement.
Security Ownership of Certain Beneficial Owners and Management
The following information table sets forth certain
information regarding the Company's Common Stock owned on
November 30, 1999 by (i) each who is known by the Company
to own beneficially more than 5% of it's outstanding Common
Stock, (ii ) each director and officer, and (iii) all officers and
directors as a group:
Names and Address of Shares Owned (1)( 2)
Directors, Officers and Number (6) Percent
5% Shareholders
MidMark Capital L.P. 5,000,000 29.5
466 Southern Blvd.
Chatham, NJ 07928
Bacchus International 1,217,718 7.2
2321 "C"
North Geneva Terrace
Chicago, IL 60614
James Q. Maloy 1,202,208 7.1
23 Carol Street
Clifton, New Jersey
Nicholas R.H. Toms 1,151,120 6.8
23 Carol Street
Clifton, New Jersey
Ronald C. Byer 448,422 2.7
23 Carol Street
Clifton, New Jersey
Bunter, B.V.I., Ltd 413,010 2.4
C/O Ansbacher, B.V.I. Ltd.
Roadtown, Tortola, B.V.I.
Gregory Thomas 294,117 1.7
4 Acorn Street
Boston, MA
All officers and directors 7,356,669 43.4
as a group (8 persons)(3)(4)(5)
<FN>
(1) Does not give effect to the issuance of up to 2,000,000
shares of Common Stock reserved for issuance under the Company's
incentive stock option plan or 445,000 shares under non-qualified
stock options.
(2) Gives effect to a 2 for 1 stock split effective April 19, 1993.
(3) Includes 50,000 shares of common stock owned by Mr. George Powch.
(4) Includes 413,000 shares held in the name of Bunter, B.V.I., Ltd. of
which Mr. Hugo Biermann may be deemed a beneficiary. Mr. Biermann
disclaims such beneficial ownership.
(5) Includes the 5,000,000 shares held in the name of
MidMark Capital L.P. of which Mr. Joseph R. Robinson, Mr.
Denis Newman and Mr. Wayne L. Clevenger are managing
directors, but disclaim beneficial ownership.
(6) Mr. Joseph R. Robinson, Mr. Denis Newman and Mr. Wayne
L. Clevenger are managing directors of MidMark Capital
L.P. but disclaim beneficial ownership of shares.
INTEREST OF CERTAIN PERSONS IN OR IN
OPPOSITION TO MATTERS TO BE ACTED UPON
The Amendments were unanimously approved by the Board of
Directors on December 15, 1999. On December 20, 1999,
Nicholas R. H. Toms, a Director of the Company and Joint
Chief Executive Officer, who has sole voting power with
respect to 1,151,120 shares of Common Stock, Ronald C.
Byer, President of the Company, who has sole voting power
with respect to 448,422 shares of Common Stock, and James Q.
Maloy, a former Director, who has sole voting power with
respect to 1,202,208 shares of Common Stock, executed and
delivered a written consent approving the Amendments.
The Stockholders have no right under the New Jersey
Business Corporation Law, the Company's Certificate of
Incorporation or By-Laws to dissent from any of the
provisions adopted in the Amendments.
AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION
TO EFFECT NAME CHANGE
On December 15, 1999, the Board of Directors approved
an amendment to the Certificate of Incorporation to change
the name of the Company to Vertex Interactive, Inc. The
holders of over a majority of the outstanding shares of
Common Stock approved the amendment by written consent on
December 20, 1999. The Board of Directors considers the
amendment to change the Company's name to be especially
important. The new name reflects the Company's transition
into an international systems integration and middleware
solutions provider which offers mobile computing systems,
wireless data capture systems and e-commerce and warehouse
management systems. Today, with the acquisition of Portable
Software Solutions Limited and ICS International AG, Vertex
offers customers unique solutions based on its world-class
development and communication skills combined with industry-
leading middleware and application management facilities.
The Company is now well-positioned to excel in the
interactive enterprise solutions marketplace. Hence, the new
name Vertex Interactive, Inc.
The name change will not require current holders of the
Company to surrender stock certificates. Instead, when
certificates are presented for transfer, new certificates
bearing the Vertex Interactive, Inc., name would be issued.
AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION TO
INCREASE THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK.
The Company's Certificate of Incorporation, as amended
(the "Certificate of Incorporation") authorizes the
issuance of 20,000,000 shares of Common Stock, $.005 par
value, and 2,000,000 shares of Preferred Stock, $.01 par
value. On December 15, 1999 the Board of Directors approved
an amendment to the Certificate of Incorporation to increase
the number of authorized shares of Common Stock from
20,000,000 to 32,000,000. On December 20, 1999, the holders
of over a majority of the outstanding shares of Common Stock
approved the amendment by written consent.
The general purpose and effect of the amendment to the
Company's Certificate of Incorporation is to authorize
12,000,000 additional shares of Common Stock. The Board of
Directors believes that it is prudent to have the additional
shares of Common Stock available for general corporate
purposes, including acquisitions, equity financings, stock
dividends, stock splits or other recapitalizations, and
grants of stock options.
The Company presently has 20,000,000 authorized shares
of Common Stock. As of January 4, 2000 the Company had
approximately 16,982,921 shares issued and outstanding, and
of the remaining 3,007,079 authorized but unissued shares,
the Company has reserved approximately 75,000 shares
pursuant to Company agreements with financial legal and
consulting firms, and 984,800 shares pursuant to the
Company's Employee Incentive Stock Option Plan.
Except in connection with the reserved shares described
above, the Company currently has no arrangements or
understandings for the issuance of additional shares of
Common Stock, although opportunities for acquisitions and
equity financings could arise at any time. If the Board of
Directors deems it to be in the best interests of the
Company and the Stockholders to issue additional shares of
Common Stock in the future from authorized shares, the Board
of Directors generally will not seek further authorization
by vote of the Stockholders, unless such authorization is
otherwise required by law or regulations.
The increase in the authorized number of shares of
Common Stock could have an anti-takeover effect. If the
Company's Board of Directors desires to issue additional
shares in the future, such issuance could dilute the voting
power of a person seeking control of the Company, thereby
deterring or rendering more difficult a merger, tender
offer, proxy contest or an extraordinary corporate
transaction opposed by the Company.
AMENDMENT TO INCREASE THE NUMBER OF SHARES RESERVED FOR
ISSUANCE UNDER THE INCENTIVE STOCK OPTION PLAN
The Company is seeking Stockholder approval to increase
the number of shares reserved for issuance under the Amended Incentive Stock
Option Plan (the "Plan") by 2,000,000 shares. The purpose of the Plan is to
advance the interests of the Company and its Stockholders by providing an
incentive to attract, retain and reward the Company's employees, directors
and consultants and by motivating such persons to contribute to the Company's
growth and profitability.
Currently, a maximum of 2,000,000 of the authorized but
unissued shares of the Common Stock of the Company may be issued under
the Plan. Of the 2,000,000, 609,200 remain available. As amended,
the maximum number of shares issuable under the Plan would be increased
to 4,000,000, which would result in 2,609,200 shares being available under
the Plan. A summary of the plan is set forth herein. A copy of the Plan is
on file at the Company and is available to Stockholders upon request.
In order to continue to attract and retain key talent, the Company
must offer market-competitive, long-term compensation opportunities. Stock
options, because of their upside potential and vesting requirements,
are a key component in recruiting and retaining these employees. The
Company believes that the stock option program is important
in order to maintain employee motivation and continued success.
Incentive Stock Option Plan
Under the Company's Incentive Stock Option Plan ("the
Plan"), options to purchase a maximum of 2,000,000 shares of
its Common Stock may be granted to officers and other key
employees of the Company. Options granted under the Plan are
intended to qualify as incentive stock options under the
Economic Recovery Tax Act of 1981, as amended.
The Plan is administered by the Board of Directors and
a committee presently consisting of three members of the
Board which determines which persons are to receive options,
the number of shares that may be purchased under each option
and the exercise prices. In the event an optionee
voluntarily terminates his employment with the Company, he
has the right to exercise his accrued options within 30 days
of such termination. However, the Company may redeem any
accrued options held by each optionee by paying him the
difference between the option price and the then fair market
value. If an optionee's employment is involuntarily
terminated, other than because of death, he also has the
right to exercise his accrued options within 30 days of such
termination. Upon death, his estate or heirs have one year
to exercise his accrued options. The maximum term of any
option is ten years, and the option price per share may not
be less than the fair market value of the Company's shares
on the date the option is granted. However, options granted
to persons owning more than 10% of the voting shares of the
Company may not have a term in excess of five years and the
option price per share may not be less than 110% of the fair
market value on the date the option is granted.
If the aggregate fair market value of the shares of
Common Stock (determined at the time the option is granted)
with respect to which incentive stock options are
exercisable for the first time by such optionee during any
calendar year (under all such plans) exceeds $100,000, then
only the first $100,000 of such shares so purchased will be
treated as exercised under the Plan and any excess over
$100,000 so purchased shall be treated as options which are
not incentive stock options. This rule shall be applied by
taking options into account in the order or sequence in
which they are granted. Options must be granted within ten
years from the effective date of the Plan.
Options granted under the Plan are not transferable
other than by will or by laws of descent and distribution.
Options granted under the Plan are protected by anti-
dilution provisions increasing the numbers of shares
issuable thereunder and reducing the exercise price of such
options, under certain conditions. The Plan expires on
October 9, 2005. Any option outstanding at the termination
date will remain outstanding until it expires or is
exercised in full, whichever occurs first. At the Company's
annual meeting in the second quarter of fiscal 1998 the
Company's shareholders approved an additional 500,000 shares
of common stock to be issued under the Plan for a total
2,000,000 shares of common stock in the plan.
EFFECTIVE DATE OF AMENDMENTS
Pursuant to Rule 14c-2 under the Exchange Act, the filing
of the Amendments to the Certificate of Incorporation with
the New Jersey Secretary of State or the effective date of
such filing, or the effective date of the amendment to the
Company's Amended Incentive Stock Option Plan shall not
occur until a date at least twenty (20) days after the date
on which this Information Statement has been mailed to the
Stockholders. The Company anticipates that the actions
contemplated hereby will be effected on or about the close
of business on February 14, 2000.
By Order of the Board of Directors
/s/ Nicholas R.H. Toms
Nicholas R.H. Toms
Joint Chairman of the Board of Directors
Joint Chief Executive Officer