SCHEDULE 14A INFORMATION
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 [ ]
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
Pamet Systems, Inc.
_________________________________________________________________________
(Name of the Registrant as Specified in Its Charter)
Pamet Systems, Inc.
_________________________________________________________________________
Name of Person(s) filing Proxy Statement
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:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11
4) Proposed maximum aggregate value of transactions:
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 Form or Schedule and the date of its filing.
1) Amount previously Paid
2) Form, Schedule or registration Statement No.:
3) Filing Party:
4) Date Filed:
PAMET SYSTEMS, INC.
1000 Main Street
Acton, Massachusetts 01720
____________________________
NOTICE OF ANNUAL
MEETING OF STOCKHOLDERS
____________________________
Acton, Massachusetts
April 30, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
PAMET SYSTEMS, INC. (the "Company"), a Massachusetts corporation, will be
held at the executive offices of the Company, 1000 Main Street, Acton,
Massachusetts 01720 on May 30, 1997, at 10:00 a.m. (Eastern Standard Time),
for the purposes of considering and voting upon the following matters, as
more fully described in the attached Proxy Statement:
1. To elect Richard C. Becker and Arthur V. Josephson, Jr. to serve as
directors for a term of three years (expiring in 2000) and until
their respective successors are elected and qualified; and
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only those stockholders of record at the close of business on April 4,
1997 shall be entitled to receive notice of, and vote at the meeting and
any adjournment(s) thereof. Such stockholders may vote in person or by
proxy. The stock transfer books will not be closed.
All stockholders are cordially invited to attend the meeting in
person. In any event, please mark your votes, then date, sign and return
the accompanying proxy in the envelope enclosed for that purpose (to which
no postage need be affixed if mailed in the United States) whether or not
you expect to attend the meeting in person. The proxy is revocable by you
at any time prior to its exercise. The prompt return of the proxy will be
of assistance in preparing for the meeting and your cooperation in this
respect will be appreciated.
The Annual Report of the Company for the fiscal year ended December
31, 1996 is also enclosed.
By order of the Board Of
Directors
ARTHUR V. JOSEPHSON, JR.
Clerk
PAMET SYSTEMS, INC.
1000 Main Street
Acton, Massachusetts 01720
_________________________
PROXY STATEMENT
_________________________
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 30, 1997
This Proxy Statement is furnished to holders of Common Stock, $.01 par
value per share (the "Common Stock") of Pamet Systems, Inc. (the "Company")
in connection with the solicitation of proxies, in the accompanying form,
by the Board of Directors of the Company, for use at the Annual Meeting of
Stockholders to be held at the executive offices of the Company, 1000 Main
Street, Acton, Massachusetts on May 30, 1997, at 10:00 a.m., and at any and
all adjournments thereof. Stockholders may revoke the authority granted by
their execution of proxies at any time prior to their use by filing with
the Clerk of the Company a written revocation or duly executed proxy
bearing a later date or by attending the meeting and voting in person.
Solicitation of proxies will be made chiefly through the mails, but
additional solicitation may be made by telephone or telegram by the
officers or regular employees of the Company. The Company may also enlist
the aid of brokerage houses in soliciting proxies. All solicitation
expenses, including costs of preparing, assembling and mailing proxy
material, will be borne by the Company. This proxy statement and
accompanying form of proxy are being mailed to stockholders on or about
April 30, 1997.
Shares of the Company's Common Stock represented by executed and
unrevoked proxies will be voted in accordance with the choice or
instructions specified thereon. It is the intention of the persons named
in the proxy, unless otherwise specifically instructed in the proxy, to
vote all proxies received by them FOR the election of Richard C. Becker and
Arthur V. Josephson, Jr. to serve as directors for a term of three years
(expiring in 2000) and until their successors are elected and qualified.
VOTING
Only stockholders of record at the close of business on April 4, 1997
will be entitled to vote at the meeting or any and all adjournments
thereof. As of April 4, 1997, the Company had issued and outstanding
2,102,250 shares of Common Stock. Each holder of Common Stock will be
entitled to one vote for each share of Common Stock registered in his or
her name on the record date. The holders of fifty-one percent (51%) of the
outstanding shares of Common Stock constitute a quorum and are required to
be present in person or by proxy to conduct business at the meeting.
The favorable vote of a plurality of the votes cast at the meeting is
necessary to elect each director of the Company. Abstentions and broker
non-votes are not considered votes cast and will have no effect on the
outcome of the matters scheduled to be considered at the Annual Meeting.
The Board of Directors recommends a vote FOR each of the nominees named
below.
ELECTION OF DIRECTORS
The Board of Directors is divided into three classes. One class of
directors will be elected at the 1997 Annual Meeting. The directors in
Class I, Richard C. Becker and Arthur V. Josephson, Jr., are nominated for
a term of three years and until their successors are duly elected and
qualified. Each nominee has indicated to the Company that he is willing to
serve as a director of the Company if elected, and the Board of Directors
has no reason to believe that any of the nominees will become unable or
unwilling to serve. However, in the event that any nominee should become
unavailable for election for any presently unforeseen reason, the persons
named in the form of proxy will vote for any nominee who shall be
designated by the present Board of Directors.
The information set forth below as to the ages and principal
occupations of these nominees and the other members of the Board of
Directors has been furnished to the Company by such nominees or directors.
NOMINEES WHOSE TERMS EXPIRE IN 2000
(Class I)
Name Age Principal Occupation Director
Since
Richard C. Becker 51 Mr. Becker has been Vice President and 1991
Chief Operating Officer since July
1993, Assistant Clerk since February
1991 and Treasurer since May 1991. He
was Vice President - Finance and
Administration of the Company from
January 1991 through June 1993.
Arthur V. Josephson, 54 Mr. Josephson has served as Clerk for 1988
Jr. the Company since September 1990. In
addition to his responsibilities to
the Company, since 1985 Mr. Josephson
has served as an accounting consultant
to a number of clients in Massachusetts.
Mr. Josephson also served as the
Treasurer of Assabet Valley Home Health
Association, Inc., a visiting nurse
agency, from 1977 through October 1994.
DIRECTORS WHOSE TERMS EXPIRE IN 1998
(Class II)
Name Age Principal Occupation Director
Since
Dr. Stanley J. Robboy 56 Since April 1993, Dr. Robboy has been 1990
Professor of Pathology, Obstetrics
and Gynecology and Head of the Division
of Gynecologic Pathology of the
Department of Pathology at Duke
University Medical Center. From
January 1992 through April 1993, Dr.
Robboy was Professor of Pathology and
Chief of the Division of Surgical
Pathology of the Department of
Pathology at Duke University Medical
Center. For more than five years prior
thereto, Dr. Robboy had been a
Professor of Pathology in the
Department of Pathology at the
University of Medicine and Dentistry
of New Jersey.
Laurence B. Berger 61 Since November 1990 Mr. Berger has 1988
served as a private consultant to
various commercial and governmental
clients.
DIRECTORS WHOSE TERMS EXPIRE IN 1999
(Class III)
Dr. Joel B. Searcy 61 Dr. Searcy has been Chairman of the 1987
Board of Directors and President of the
Company since the Company's inception
in 1987, was Treasurer until May 1991
and served as Clerk until September 1990.
Lee Spelke 64 Mr. Spelke is a financial consultant 1990
who served as President of Spelke
Financial Services, Inc., a financial
consulting firm, for more than five
years, through 1994.
THE BOARD OF DIRECTORS AND ITS COMMITTEES
During the fiscal year ended December 31, 1996 the Board of Directors
of the Company held five meetings. During such period, each of the current
directors of the Company attended 75% or more of the aggregate of (1) the
total number of meetings of the Board of Directors and (2) the total number
of meetings held by all committees of the Board on which such director
served.
The Board of Directors has two committees, an Audit Committee and a
Compensation Committee. The Board of Directors does not have a nominating
committee.
The Audit Committee consists of Lee Spelke, Laurence B. Berger and
Stanley J. Robboy. The Audit Committee acts as a liaison between the
Company and its independent auditors and reports on matters pertaining to
the Company's independent audit and the Company's accounting policies. The
Audit Committee met once during fiscal 1996.
The Compensation Committee consists of Laurence B. Berger, Arthur
Josephson, Jr., Stanley Robboy, and Lee Spelke. The Compensation Committee
was formed to make recommendations to the Board of Directors with respect
to the compensation of the officers of the Company for each year and to
administer the Company's employee benefit plans. The Compensation
Committee met once during fiscal 1996.
Directors who are not officers of the Company are entitled to receive
an annual stipend of $1,000 for serving on the Board and its committees and
reimbursement for out-of-pocket expenses in connection with their
attendance at directors' meetings. Additionally, under the Company's 1990
Stock Option Plan, each non-employee director who is a director of the
Company on the last day of a calendar year or has ceased to be a director
during the calendar year due to his or her death or attainment of an age
greater than 65 is automatically granted a non-qualified stock option to
purchase 2,000 shares of Common Stock on January 1 of the succeeding
calendar year at the fair market value per share on the date of grant.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Company's executive officers and directors are required under
Section 16(a) of the Securities Exchange Act of 1934, as amended, to file
reports of ownership and changes in ownership with the Securities and
Exchange Commission. Copies of those reports must also be furnished to the
Company. Based solely on the Company's review of the copies of such reports
it has received, the Company believes that all of its other executive
officers and directors, and greater than ten percent beneficial owners
complied with all filing requirements applicable to them except that
Richard C. Becker and Dr. Stanley J. Robboy were each late in filing two
Form 4s and one Form 5 each such late filing related to one transaction),
Dr. Joel B. Searcy was late in filing on Form 5 (which related to three
transactions) and Laurence B. Berger and Lee Spelke were each late in
filing one Form 4 (each such late filing related to one transaction).
SECURITY OWNERSHIP OF CERTAIN STOCKHOLDERS
The following table provides information regarding beneficial
ownership as of April 4, 1997 of the Company's Common Stock as to (i) each
nominee and director of the Company, (ii) each of the Named Executive
Officers, (iii) each person who is known to the Company to be the
beneficial owner of more than 5% of the Company's voting securities and
(iv) all directors and executive officers as a group. The information set
forth below as to nominees, directors, and officers has been furnished to
the Company by such nominee, officer or director.
Percent of Common
Name and Address of Amount and Nature of Stock (if over 1%)
Beneficial Owner Beneficial Ownership Owned Beneficially
Dr. Joel B. Searcy 495,002(1) 23.5%
1000 Main Street
Acton, MA 01720
Lee Spelke 14,000(2) __
Richard C. Becker 105,500(3) 4.8%
Arthur V. Josephson, Jr. 55,250(4) 2.6%
Dr. Stanley J. Robboy 151,500(5) 7.2%
1000 Main Street
Acton, MA 01720
Laurence Berger 82,000(5) 3.9%
Calvin Hori 145,000(6) 6.9%
35 Norwich Road
Wellesley, MA 02181
Henry Mehlman 161,698(7) 7.7%
40 Bartlett Street
Marblehead, MA 01945
Bruce J. & Winnie R. Rogow 120,000(8) 5.7%
220 Ocean Avenue
Marblehead, MA 01945
All directors and executive 903,252(9) 39.6%
officers as a group (6 people)
(1) Includes 7,500 shares issuable upon the exercise of currently
exercisable options. See "Certain Relationships and Related
transactions.""
(2) Includes 12,000 shares issuable upon the exercise of currently
exercisable options.
(3) Includes 102,500 shares issuable upon the exercise of currently
exercisable options. See Certain Relationships and related
Transactions"
(4) Includes 29,000 shares issuable upon the exercise of currently
exercisable options.
(5) Includes 14,000 shares issuable upon the exercise of currently
exercisable options.
(6) As reported on Schedule 13D filed with the Securities and Exchange
Commission on August 11, 1995.
(7) As reported on Schedule 13D filed with the Securities and Exchange
Commission on June 5, 1995.
(8) As reported on Schedule 13D filed with the Securities and Exchange
Commission on January 6, 1997.
(9) Includes 179,000 shares issuable upon the exercise of currently
exercisable options held by all directors and officers of the Company
as a group.
EXECUTIVE COMPENSATION
The following table sets forth the compensation for services in all
capacities paid by the Company during the three fiscal years ended December
31, 1996 to the chief executive officer and the executive officers whose
total cash compensation exceeded $100,000 during the fiscal year ended
December 31, 1996. The table excludes perquisites and other personal
benefits which are less than 10% of the total annual salary and bonus for
Named Executive Officers.
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term
Compensation
Securities Under-
Name and Principal Year Salary Bonus lying Options
Position $ $ #
Dr. Joel B. Searcy 1996 120,000 10,000
Chairman and President 1995 121,340
1993 122,500
OPTION GRANTS IN THE LAST FISCAL YEAR
The following table sets forth each grant of stock options made during
the year ended December 31, 1995 to each Named Executive Officer who
received options during such year.
(1)
Potential Realized
Number of % of Total Value at Assumed
Securities Options Annual Rates of
Underlying Granted to Stock Price
Options Employees in Exercise Expir- Appreciation
Granted Fiscal year Price ationfor Option Term
Name (#) (%) ($/sh) Date 5% 10%
Joel B. Searcy 10,000 18.4% 3.50 10/4/06 $22,011 $55,650
(1) Potential realizable values are based on the fair market value per share
as determined by the Company on the date of the grant and represent
hypothetical gains that could be achieved for the respective options if
exercised at the end of the option term. The dollar amounts set forth in
these columns are the results of calculations at the five percent and ten
percent rates set by the Securities and Exchange Commission , and are not
intended to forecast future appreciation, if any, of the Company's Common
Stock price. The can be no assurance that such potential realizable values
will not be more or less than that indicated in the table above.
EMPLOYMENT AGREEMENTS
Dr. Joel B. Searcy had an employment agreement, which commenced on
November 8, 1990 and terminated on December 31, 1993. The contract was
renewed on April 30, 1994, for a three year period terminating on April 30,
1997. The agreement provided for a base salary of $120,000 per annum, the
use of an automobile and certain other benefits during the term of the
agreement. On January 22, 1997 the compensation committee increased the
base salary to $132,000 effective January 1, 1997. In the event of his
termination of employment for any reason other than cause or voluntary
termination (as defined in the agreement), Dr. Searcy will be entitled to
receive salary and bonus amounts with respect to the remaining term of the
agreement, or, if longer, a period of twelve months following such
termination. He will be entitled to receive the same payment if his
employment terminates (or constructively terminates, as defined in the
agreement) for any reason within 120 days of a "change of control" of the
Company. A "change of control" is defined in the agreement to include (a)
the delivery to the Company's stockholders of a notice announcing a
stockholders meeting to consider a proposed acquisition of the Company by
merger or other combination or a proposed sale of substantially all of the
Company's assets or a similar reorganization of the Company, (b) the
acquisition of beneficial ownership of 25% or more of the Company's voting
securities by a person other than the Company and (c) the commencement of a
tender offer for the Company's stock. If Dr. Searcy's employment is
terminated voluntarily or for cause, he will be entitled only to salary and
other benefits accrued to the date of such termination. The agreement
contains non-competition provisions which prohibit Dr. Searcy from
accepting employment with a competitor of the Company and from soliciting
Company's employees and customers during and for one year following his
employment with the Company.
Mr. Becker does not have a employment agreement.
OPTION PLAN
The Company maintains the Pamet Systems, Inc. 1990 Stock Option Plan
(the "Plan"), which was adopted by the Board and approved by the
stockholders of the Company in September 1990. The Plan, which has a
maximum of 400,000 shares of Common Stock reserved for issuance, provides
for the discretionary grant of options intended to qualify as "incentive
stock options" within the meaning of Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code") to key employees of the Company and
of non-qualified stock options to key employees and consultants (but not
non-employee directors) of the Company, and for the automatic grant of
non-qualified options to non-employee directors of the Company. See "The
Board of Directors and its Committees."
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During 1996 and 1995 the Company paid approximately $14,666 and
$14,000 respectively to Arthur V. Josephson Jr., a stockholder and director
for financial accounting services.
During 1995 the Company entered in to an agreement with Dr. Stanley J.
Robboy a stockholder and director pursuant to which he agreed to lend
money to the Company. The agreement provided for an unsecured $150,000 line
of credit and an additional $150,000 available to the Company as advances
against product purchase contracts. The agreement provides for interest on
the outstanding balance at the rate of 12% per annum. In connection with
the loan, Dr. Robboy was granted options for up to 90,000 shares of common
stock at a price of $.68 per share, with the exact number of shares
dependent upon the Company's utilization of these loans. During 1996 a
total of 85,000 shares were granted. Dr. Searcy and Mr. Becker were granted
7,500 options priced at $.68 in return for their guarantee of Dr. Robboy's
unsecured $150,000 line of credit. At December 31, 1996, the loan balance
was $173,099 and interest paid during 1996 was $19,358. At April 4, 1997,
the balance of the loans was $248,099.
RELATIONSHIP WITH INDEPENDENT AUDITORS
Representatives of Carlin Charron & Rosen LLP, the Company's auditors,
are expected to be present at the meeting. The representatives will have
the opportunity to make a statement if they so desire and will be available
to respond to appropriate questions from stockholders.
STOCKHOLDER PROPOSALS
All stockholder proposals which are intended to be presented at the
next Annual Meeting of Stockholders of the Company contemplated to be held
in 1998 must be received by the Company on or before December 31, 1997, for
inclusion in the Board of Directors' proxy statement and form of proxy
relating to the meeting.
MISCELLANEOUS
The Board of Directors knows of no other business to be acted upon at
the meeting. However, if any other business properly comes before the
meeting, it is the intention of the persons named in the enclosed proxy to
vote on such matters in accordance with their best judgment.
The prompt return of your proxy will be appreciated and helpful in
obtaining the necessary vote. Therefore, whether or not you expect to
attend the meeting, please sign the proxy and return it in the enclosed
envelope.
A copy of the Company's Annual report on Form 10-KSB for the fiscal
year ended December 31, 1996 is available without charge from Investor
Relations, Pamet Systems, Inc., 1000 Main Street, Acton, Massachusetts
01720, Telephone: (508) 263-2060.
By order of the Board of
Directors
ARTHUR V. JOSEPHSON, Jr.
Clerk
Acton, Massachusetts
April 30, 1997
PLEASE SIGN, DATE AND MAIL THE ENCLOSED PROXY CARD NOW.