ABATIX ENVIRONMENTAL CORP.
8311 EASTPOINT DRIVE, SUITE 400
DALLAS, TEXAS 75227
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO THE HOLDERS OF THE COMMON STOCK:
PLEASE TAKE NOTICE that the 1997 Annual Meeting of the Stockholders of Abatix
Environmental Corp., a Delaware corporation (the "Company"), will be held at the
Holiday Inn, LBJ Northeast, 11350 LBJ Freeway, Dallas, Texas 75238 on Thursday,
May 22, 1997 at 9:00 A.M., Central Time, or at any and all adjournments thereof,
for the following purposes:
1. To elect three directors to the Board of Directors;
2. The ratification of the appointment of independent auditors; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Proxy Statement dated April 30, 1997 is attached.
The Board of Directors has fixed the close of business on April 24, 1997 as the
record date for the determination of stockholders entitled to notice of, and to
vote, at the meeting.
Stockholders who do not expect to be present at the meeting are urged to
complete, date, sign and return the enclosed proxy. No postage is required if
the enclosed envelope is used and mailed in the United States.
BY ORDER OF THE BOARD OF DIRECTORS,
Gary L. Cox, Secretary
Dallas, Texas
April 30, 1997
ABATIX ENVIRONMENTAL CORP.
8311 EASTPOINT DRIVE, SUITE 400
DALLAS, TEXAS 75227
PROXY STATEMENT
For
ANNUAL MEETING OF STOCKHOLDERS
The Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of Abatix Environmental Corp., a Delaware corporation (the
"Company"), of proxies for use at the 1997 Annual Meeting of Stockholders
("Annual Meeting") to be held at the Holiday Inn, LBJ Northeast, 11350 LBJ
Freeway, Dallas, Texas 75238 on Thursday, May 22, 1997 at 9:00 A.M., Central
Time, or at any and all adjournments thereof. The cost of this solicitation will
be borne by the Company. Directors, officers and employees of the Company may
solicit proxies by telephone, telegraph or personal interview. The Annual Report
of the Company for the fiscal year ended December 31, 1996 is being mailed
together with this Proxy Statement and form of Proxy. The approximate date of
mailing of this Proxy Statement and form of Proxy is April 30, 1997.
OUTSTANDING STOCK AND VOTING RIGHTS
In accordance with the By-Laws of the Company, the Board of Directors has fixed
the close of business on April 24, 1997 as the record date for determining the
stockholders entitled to notice of, and to vote at, the Annual Meeting. Only
stockholders of record on that date, on which the transfer books of the Company
remained open, will be entitled to vote. A stockholder who submits a proxy on
the accompanying form has the power to revoke it by notice of revocation
directed to the proxy holders of the Company at any time before it is voted.
Unless authority is withheld in writing, proxies which are properly executed
will be voted for the proposals thereon. Although a stockholder may have given a
proxy, such stockholder may nevertheless attend the meeting, revoke the proxy
and vote in person. The affirmative vote of a plurality of the shares of Common
Stock present or represented at the meeting is required to elect Directors. The
ratification of the appointment of the Company's auditors will require the
affirmative vote of a majority of the shares of the Company's Common Stock
voting at the Annual Meeting in person or by proxy.
As of April 24, 1997, the record date for determining the stockholders of the
Company entitled to vote at the Annual Meeting, approximately 1,943,064 shares
of the Common Stock of the Company, $.001 par value ("Common Stock"), were
issued and outstanding. Each share of Common Stock entitles the holder to one
vote on all matters brought before the Annual Meeting. The quorum necessary to
conduct business at the Annual Meeting consists of a majority of the outstanding
shares of Common Stock as of the record date.
Brokers who hold shares for the accounts of their clients may vote such shares
either as directed by their clients or in their own discretion if permitted by
the stock exchange or other organization of which they are members. Members of
the New York Stock Exchange are permitted to vote their client's proxies in
their own discretion as to the election of directors if the client has not
furnished voting instructions within ten days of the meeting. Certain proposals
other than the election of directors are "non-discretionary" and brokers who
have received no instructions from their clients do not have discretion to vote
on those items. When brokers vote proxies on some but not all of the proposals
at a meeting, the missing votes are referred to as "broker non-votes". If any
such proposals were on the agenda for this meeting, broker non-votes would be
included in determining the presence of a quorum at the meeting, but they would
not be considered "shares present" for voting purposes and would have no impact
on the outcome of such proposals.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth Common Stock ownership information as of March
31, 1997, with respect to (i) each person known to the Company to be the
beneficial owner of more than 5% of the Company's Common Stock, (ii) each
director and executive officer of the Company and (iii) all directors and
executive officers of the Company as a group. This information as to beneficial
ownership was furnished to the Company by or on behalf of the persons named.
Unless otherwise indicated, the business address of each person listed is 8311
Eastpoint Drive, Suite 400, Dallas, Texas 75227.
Shares
Beneficially Percent of
Name Owned (1) Class (2)
- ---- ------------ ------------
Terry W. Shaver (3) 601,450 30.8%
Gary L. Cox (4) 397,750 20.4%
Frank J. Cinatl (5) 14,000 0.7%
Lamont C. Laue (6) 2,000 0.1%
All executive officers and directors
as a group (4 persons) 1,015,200 51.4%
(1) Unless otherwise provided, represents shares for which the beneficial owner
has sole voting and investment power and includes options currently
exercisable or exercisable within 60 days.
(2) The percentage of class is calculated assuming that the beneficial owner
has exercised any options or other rights to subscribe which are currently
exercisable within sixty (60) days and that no other options or rights or
warrants to subscribe have been exercised by anyone else.
(3) Mr. Shaver is President, Chief Executive Officer and a Director of the
Company. The shares beneficially owned by Mr. Shaver include options to
purchase 11,250 shares of the Company's Common Stock.
(4) Mr. Cox is Executive Vice President, Chief Operating Officer, Secretary and
a Director of the Company. The shares beneficially owned by Mr. Cox include
options to purchase 11,250 shares of the Company's Common Stock.
(5) Mr. Cinatl is Vice President and Chief Financial Officer of the Company.
The shares beneficially owned by Mr. Cinatl include options to purchase
10,000 shares of the Company's Common Stock.
(6) Mr. Laue is a Director of the Company.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
In reporting two transactions for the month of May 1996, Mr. Terry W. Shaver's
Form 4 was filed six days beyond the due date.
ELECTION OF DIRECTORS
The Board of Directors is responsible for the overall affairs of the Company.
The names of the nominees, their principal occupations and the year in which
they became Directors, are set forth.
NOMINEES FOR ELECTION
Name and Principal Director
Occupation Age Since
- ------------------------------ ----- --------
Terry W. Shaver, President and 39 1988
Chief Executive Officer
Gary L. Cox, Executive Vice 43 1988
President, Chief Operating
Officer and Secretary
Lamont C. Laue, Consultant 67 1995
Each Director is elected for a period of one year at the Company's annual
meeting of stockholders. Executive officers are appointed annually and, except
to the extent governed by employment contracts, serve at the discretion of the
Board of Directors.
TERRY W. SHAVER has served as President, Chief Executive Officer and a Director
of the Company since its incorporation in December 1988 and of its predecessor,
T&T Supply Company, Inc., since its organization in May 1983. From February 1979
until May 1983, Mr. Shaver was a Sales Representative with Global Safety
Resources, Inc., Dallas, Texas, a distributor of industrial safety equipment and
supplies. From July 1978 to January 1979, Mr. Shaver was a Sales Representative
with Continental Industrial Supply Corp., Richardson, Texas, a distributor of
industrial equipment and supplies. Between January 1977 and July 1978, Mr.
Shaver was a Sales Representative with Briggs-Weaver, Inc., Dallas, Texas, a
distributor of industrial equipment and supplies.
GARY L. COX has been Executive Vice President, Chief Operating Officer and a
Director of the Company since its organization and Vice President and a Director
of its predecessor corporation, T & T Supply Company, Inc., since February 1985.
From April 1984 to December 1985, Mr. Cox also was Vice President of Diamond
Built, Inc., Dallas, Texas, a real estate investment and construction company.
Between January 1980 and March 1984, Mr. Cox was President of W.R. Cox Electric,
Inc., Dallas, Texas, an electrical contracting firm and was with that company in
various capacities commencing in June 1974.
LAMONT C. LAUE was appointed a Director of the Company in January 1995 to fill
the vacancy on the Board of Directors, and was elected a Director at the 1995
annual meeting. Mr. Laue also served as a Director of the Company from 1989
until 1991. Between 1960 and December 1987, Mr. Laue was employed in various
executive capacities with Sun Exploration and Production Company or affiliates
thereof. During this time, Mr. Laue was the Manager of Business Planning and
Economics Analysis for the Production Division from January 1984 to December
1987, and was the Manager of Operations Services for the Sun Gas Company between
January 1981 and December 1983. Mr. Laue retired from Sun Exploration and
Production Company in December 1987.
The Company has not established a standing audit, nominating or compensation
committee of the Board of Directors at the present time. During 1996, the Board
of Directors held five meetings which were attended by all of the Directors.
All Directors who are not otherwise employed by the Company received during 1996
and will receive in the future an annual fee of approximately $2,500 for serving
as Directors. Directors will also be reimbursed for reasonable expenses incurred
in connection with their attendance at meetings. There are no family
relationships among the Company's Executive Officers and Directors.
Section 145 of the General Corporation Law of Delaware permits the
indemnification of directors, officers, employees and agents of Delaware
corporations. The Company's Certificate of Incorporation and By-Laws provide
that the Company shall indemnify its Directors and Officers to the full extent
permitted by the General Corporation Law of the State of Delaware.
EXECUTIVE COMPENSATION
The Company has no Compensation Committee. However, all three directors
participated in decisions by the Board of Directors with respect to compensation
for the Company's key executives. The current compensation program for executive
officers consists of three major elements: (1) base salary; (2) performance base
bonuses; and (3) periodic stock option grants. It is the policy of the Company
to review executive officer base salaries in relation to comparable positions of
responsibility in similar sized companies and based upon the executive officer's
performance. In establishing base salary levels and determining performance base
bonuses, the Board has considered the competitiveness of the entire compensation
package.
All of the Company's Executive Officers are full-time employees. Total cash
compensation paid to all Executive Officers as a group for services provided to
the company in all capacities during the fiscal year ended in December 31, 1996
aggregated to $421,000. Set forth below is a summary compensation table in the
tabular format specified in the applicable rules of the Securities and Exchange
Commission with respect to all Executive Officers of the Company or any of its
subsidiaries who received total salary and bonus which exceeded $100,000 during
the periods reflected.
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
----------------------------------- -------------------------------------
Securities
Name and Restricted underlying
principal Other annual stock Options/ LTIP All other
position Year Salary Bonus compensation award(s) SARs (#) payouts compensation
- ---------- ------ ---------- --------- ------------ ------------ ------------ --------- --------------
Terry W. 1996 $135,000 $31,250 $12,000* - 11,250 - -
Shaver, 1995 $125,000 $10,000 $13,065* - 21,250 - -
President 1994 $116,000 - $12,000* - 20,000 - -
and CEO
Gary L. 1996 $135,000 $16,250@ $12,000* - 11,250 - -
Cox, 1995 $125,000 $10,000 $13,065* - 21,250 - -
Exec. V.P. 1994 $116,000 - $12,000* - 20,000 - -
and COO
Frank J. 1996 $72,000 $30,000 $1,140 - 10,000 - -
Cinatl, 1995 $65,000 - - - 30,000 - -
V.P. 1994 $60,000 - - - 30,000 - -
and CFO
* - Represents the annual value of vehicles and related maintenance benefits
($12,000) provided to such executive officers in all years presented. In 1995,
the amount also includes an amount related to the exercise of stock options
whereby the market price exceeded the exercise price on the date of exercise.
@ - Mr. Cox elected to defer $15,000 of his 1996 bonus until January 1997.
EMPLOYMENT AGREEMENTS
Messrs. Shaver and Cox are parties to employment agreements with the Company
expiring December 31, 1998. These agreements provide for minimum annual
compensation of $150,000 each. Such employment agreements preclude each
individual from competing with the Company for a period of twelve months
following termination of his employment for cause or by reason of his
voluntarily leaving the employ of the Company. The employment agreements also
require them to maintain the confidentiality of proprietary data relating to the
Company and its activities and services. The employment agreements also provide
for certain executive benefits such as the use of an automobile, reimbursement
of business expenses, health insurance and related benefits.
The Company maintains a corporate membership at a local country club which is
used by the officers and key employees of the Company to promote the business of
the Company. Mr. Shaver pays the dues under this arrangement.
AGGREGATE OPTION/SAR EXERCISES IN 1996 FISCAL YEAR AND FISCAL
YEAR-END OPTION/SAR VALUES
Number of
securities Value of
underlying unexercised
unexercised in-the-money
options/SARs at options/SARs at
fiscal year end fiscal year end
(#) ($)
--------------- ---------------
Shares acquired Value Exercisable / Exercisable /
Name on exercise (#) Realized ($) unexercisable unexercisable
- --------------- --------------- ------------ --------------- ---------------
Terry W. Shaver - - 11,250 $1,250
11,250 / - $1,250 / -
Gary L. Cox - - 11,250 $1,250
11,250 / - $1,250 / -
Frank J. Cinatl - - 10,000 $1,250
10,000 / - $1,250 / -
PERFORMANCE GRAPH
The following table compares total stockholder returns for the Company over the
last five years to the CRSP Total Return Index for The Nasdaq Stock Market and
for Nasdaq Non-Financial Stocks assuming a $100 investment made on December 31,
1991. The stock performance shown on the table below is not necessarily
indicative of future price performance. The closing bid price is used to compute
the return for Abatix Environmental Corp.
1991 1992 1993 1994 1995 1996
------ ------ ------ ------ ------ ------
Abatix Environmental Corp. $100 $156 $289 $178 $256 $256
Nasdaq Total Return Index $100 $116 $134 $131 $185 $227
Nasdaq Non-Financial Stocks Index $100 $109 $126 $121 $169 $206
RETIREMENT PLANS
The Company has a 401(K) Plan, pursuant to which the Company contributed
$46,549, $51,358 and $25,657 during 1996, 1995 and 1994, respectively. At this
time Terry W. Shaver, Gary L. Cox, Frank J. Cinatl and 58 other employees are
eligible to participate in the 401(K) Plan, which requires all employees to have
performed services to the Company for at least one year. Contributions by an
employee in any one year may not exceed the lesser of 15% of their respective
salary or the Internal Revenue Service specified limits. The Company currently
matches 30% of the employees' contributions on an ongoing basis, but the Board
of Directors may approve an increase or a decrease in the matching portion at
any time in the future.
TRANSACTIONS WITH MANAGEMENT AND AFFILIATES
As of December 31, 1996 and March 31, 1997, Mr. Gary L. Cox owed the Company
$62,042 and $64,087, respectively. This amount was loaned to Mr. Cox to pay the
tax liability associated with the exercise of stock options in 1993. The
interest rate on this loan is the prime rate plus 200 basis points.
APPOINTMENT OF THE COMPANY'S AUDITORS
The appointment of KPMG Peat Marwick as independent auditors of the Company for
the fiscal year ended December 31, 1997 will be ratified.
Although the Board of Directors of the Company is submitting the appointment of
KPMG Peat Marwick for stockholder approval, it reserves the right to change the
selection of KPMG Peat Marwick as auditors, at any time during the fiscal year,
if it deems such change to be in the best interest of the Company, even after
stockholder approval.
Representatives of KPMG Peat Marwick are expected to be present at the Annual
Meeting with the opportunity to make a statement if they so desire, and will be
available to respond to appropriate questions.
INTEREST OF CERTAIN PERSONS IN
OPPOSITION TO MATTERS TO BE ACTED UPON
The Company is not aware of any substantial interest, direct or indirect, by
securities holdings or otherwise of any officer, director or associate of the
foregoing persons in any matter to be acted on, as described herein, other than
elections to offices.
OTHER MATTERS
Management is not aware of any other business which may come before the meeting.
However, if additional matters properly come before the meeting, proxies will be
voted at the discretion of the proxy holders.
STOCKHOLDER'S PROPOSALS TO BE PRESENTED AT
THE COMPANY'S NEXT ANNUAL MEETING OF
STOCKHOLDERS
Stockholder proposals intended to be presented at the 1998 Annual Meeting of
Stockholders of the Company must be received by the Company, at its principal
executive offices no later than December 31, 1997, for inclusion in the Proxy
Statement and Proxy relating to the 1998 Annual Meeting of Stockholders.
AVAILABILITY OF FORM 10-K ANNUAL REPORT
Copies of the Company's Annual Report on Form 10-K for the year ended December
31, 1996, as filed with the Securities and Exchange Commission, are available
without charge to stockholders upon request to Mr. Frank J. Cinatl, Vice
President, Abatix Environmental Corp., 8311 Eastpoint Drive, Suite 400, Dallas,
Texas 75227.
BY ORDER OF THE BOARD OF DIRECTORS
Gary L. Cox, Secretary
Dallas, Texas
April 30, 1997