SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
Advanced Photonix, Inc.
- - ------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- - ------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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 (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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notice of Annual Meeting of Stockholders
To Be Held
October 16, 1996
To the Stockholders of Advanced Photonix, Inc.:
You are invited to attend the Annual Meeting of Stockholders (the "Annual
Meeting") of Advanced Photonix, Inc. (the "Company"), which will be held at the
Westlake Village Inn, 31943 Agoura Road, Westlake Village, California at 10:00
a.m., Pacific time, on October 16, 1996, to consider the following matters:
(1) The election of four Directors to hold office until the next Annual Meeting
of Stockholders and until their respective successors are duly elected and
qualified. The persons nominated by the Board of Directors (James W. Ward,
James A. Gordon, Hayden Leason and Jon B. Victor) are described in the
accompanying Proxy Statement.
(2) The transaction of such other business as may properly come before the
Annual Meeting or any adjournments or postponements thereof.
The Board of Directors has fixed the close of business on August 23, 1996 as the
record date for the Annual Meeting. Only stockholders of record of the Company's
Common Stock at the close of business on August 23, 1996 will be entitled to
notice of, and to vote at, the Annual Meeting or any adjournments or
postponements thereof. Shares can be voted at the Annual Meeting only if the
holder is present or represented by proxy.
The accompanying form of proxy is solicited by the Board of Directors of the
Company. Reference is made to the attached Proxy Statement for further
information with respect to the business to be transacted at the Annual Meeting.
A complete list of stockholders entitled to vote at the Annual Meeting shall be
open to the examination of any stockholder, for any purpose germane to the
Annual Meeting, during ordinary business hours, for a period of at least 10 days
prior to the Annual Meeting, at the Company's principal office, 1240 Avenida
Acaso, Camarillo, CA 93012.
STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. WHETHER OR NOT
YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, PLEASE COMPLETE, DATE AND
SIGN THE ACCOMPANYING PROXY CARD AND RETURN IT WITHOUT DELAY IN THE ENCLOSED
POSTAGE PREPAID ENVELOPE. YOUR PROXY WILL NOT BE USED IF YOU ARE PRESENT AND
PREFER TO VOTE IN PERSON OR IF YOU REVOKE THE PROXY.
By Order of the Board of Directors
/s/ Patrick J. Holmes
Patrick J. Holmes
September 23, 1996 Secretary
Proxy Statement
Annual Meeting of Stockholders
October 16, 1996
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Directors of Advanced Photonix, Inc., a Delaware corporation
(the "Company"), for use at the 1996 Annual Meeting of Stockholders of the
Company and for any adjournments or postponements thereof (the "Annual Meeting")
to be held at the Westlake Village Inn, 31943 Agoura Road, Westlake Village,
California, at 10:00 a.m., Pacific time, on October 16, 1996, for the purposes
set forth in the accompanying Notice of Annual Meeting of Stockholders. A Board
of Directors' proxy (the "Proxy") for the Annual Meeting is enclosed, by means
of which you may vote as to the proposal described in this Proxy Statement.
All Proxies that are properly completed, signed and returned to the Company
prior to the Annual Meeting, and which have not been revoked, will be voted in
accordance with the stockholder's instructions contained in such Proxy. In the
absence of instructions, shares represented by such Proxy will be voted FOR the
election of the nominees of the Board of Directors for Director. The Board of
Directors is not aware of any business to be presented at the Annual Meeting
except the matters set forth in the Notice and described in the Proxy Statement.
If any other matters come before the Annual Meeting, the persons named in the
accompanying Proxy will vote on those matters in accordance with their best
judgment. A stockholder may revoke his or her Proxy at any time before it is
exercised by filing with the Secretary of the Company at its offices at 1240
Avenida Acaso, Camarillo, CA 93012, either a written notice of revocation or a
duly executed Proxy bearing a later date, or by appearing in person at the
Annual Meeting and expressing a desire to vote his or her shares in person.
This Proxy Statement and the accompanying Notice of Annual Meeting of
Stockholders, Proxy and 1996 Annual Report to Stockholders are being sent to
stockholders on or about September 23, 1996.
VOTING SECURITIES
August 23, 1996 has been fixed as the record date for the determination of
stockholders entitled to notice of and to vote at the Annual Meeting or any
adjournment or postponement thereof. As of that date, the Company had
outstanding 10,823,066 shares of Class A and Class B Common Stock, $.01 par
value, excluding 22,223 Class B treasury shares. The presence, in person or by
proxy, of stockholders entitled to cast a majority of votes which stockholders
are entitled to cast in the election of Directors will constitute a quorum for
the Annual Meeting. Holders of Class A and Class B Common Stock are entitled to
one vote for each share owned upon all matters to be considered at the Annual
Meeting. Proxies marked "Abstain" are included in determining a quorum, but
broker proxies which have not voted in the election of Directors are not
included in determining a quorum for such matter. There is no cumulative voting
in the election of Directors.
1
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of August 23,1996, certain information
concerning the holdings of each person who was known by the Company to be the
beneficial owner of more than five percent (5%) of the outstanding shares of
Class A or Class B Common Stock of the Company, by each director and executive
officer and by all directors and officers as a group.
Class A Common Stock Class B Common Stock
-------------------------------------------- ------------------------------------------
Shares Under Shares Under
Shares Exercisable Percent of Shares Exercisable Percent Percent
Owned Options/Warrants 1 Class Owned Options/Warrants of Class Voting 2
Hayden Leason 3 1,274,100 12,500 12.0 - - - 11.9
The Dreyfus Corporation 4 985,000 - 9.2 - - - 9.1
J. Morton Davis 5 656,045 333,340 9.0 - - - 8.9
James A. Gordon 6 781,040 27,500 7.6 - - - 7.5
Edgewater Private Equity Fund 7 781,040 27,500 7.6 - - - 7.5
Advanced Detectors, Inc. 8 - 750,000 6.6 - - - 6.5
John Pappajohn 9 186,668 500,000 6.1 - - - 6.1
Jon B. Victor 10 187,400 12,500 1.9 - - - 1.8
Andrzej J. Dabrowski 11 - 82,000 0.8 - 80,000 35.6 1.5
James W. Ward 13,850 90,000 1.0 - - - 1.0
Patrick J. Holmes 50,000 54,000 1.0 - - - 1.0
Harry Melkonian 10,000 60,000 0.7 - - - 0.6
Robert C. King 22,000 12,000 0.3 - - - 0.3
Directors & Officers as a Group 2,150,990 350,500 22.7 - 80,000 35.6 22.9
<FN>
- --------
1 Includes shares under options/warrants exercisable on August 23, 1996 and options which become exercisable within
60 days thereafter.
2 Represents combined voting power of both Class A and Class B Common Stock, assuming beneficial owner exercises all
exercisable options and warrants.
3 The address of this shareholder is Palmas Del Mar,10 Monte Sol, Humacao, Puerto Rico 00791.
4 Shareholder is a subsidiary of Mellon Bank,N. A., One Mellon Bank Center, Pittsburgh, PA 15258-0001.
5 The address of this shareholder is D.H. Blair, 44 Wall Street, New York, NY 10005. Does not include 750,000 shares of
Class A Common Stock underlying options owned by Advanced Detectors, Inc. (ADI) Mr. Davis beneficially owns
approximately 49% of ADI. Mr. Davis disclaims beneficial ownership of the shares underlying options owned by ADI.
Includes 617,760 shares and 333,340 shares underlying a unit purchase option owned by D. H. Blair Investment Banking
Corp. and 38,285 shares owned by Parliament Hill Corporation.
6 The address of this shareholder is c/o Edgewater Private Equity Fund, 4225 Woodlawn Drive, Des Moines, IA 50306.
Includes 593,640 shares owned by Edgewater Private Equity Fund, LP (Edgewater). Mr. Gordon is the President of
Gordon Management, Inc. which is the general partner of Edgewater. Includes 187,400 shares owned by Mr. Victor (see
footnote 10). Mr. Victor is a shareholder of Gordon Management, Inc.
7 The address of this shareholder is c/o Edgewater Private Equity Fund, 4225 Woodlawn Drive, Des Moines, IA 50306.
Includes 27,500 options granted to Mr. Gordon ( see footnote 6) and 187,400 shares owned by Mr. Victor (see footnote 10).
8 Formerly Xsirius, Inc., the address of this shareholder is 1220 Avenida Acaso, Camarillo, CA 93012.
9 The address of this shareholder is c/o Equity Dynamics, 2116 Financial Center, Des Moines, IA 50309.
10 The address of this shareholder is c/o Greenwich Ventures, LLC, 2 Soundview Drive, Greenwich, CT 06830. Does not
include 593,640 shares owned by Edgewater Private Equity Fund, LP (Edgewater). Mr. Victor is a shareholder of Gordon
Management, Inc. which is the general partner of Edgewater. Mr. Victor disclaims beneficial ownership of the shares
owned by Edgewater.
11 Mr. Dabrowski beneficially owns approximately 14% of Advanced Detectors, Inc. (ADI). Does not include 750,000 shares
of Class A Common Stock underlying options owned by ADI. Mr. Dabrowski disclaims beneficial ownership of the shares
underlying the ADI option.
2
</FN>
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and Directors and persons who own more than ten percent of a registered
class of the Company's equity securities (collectively the "Reporting Persons")
to file reports of beneficial ownership and changes in beneficial ownership of
the Company's equity securities with the Securities and Exchange Commission and
to furnish the Company with copies of these reports. Based on the Company's
review of copies of these reports received by it, the Company believes that all
filings required to be made by the Reporting Persons during fiscal year 1996
were made on a timely basis.
ELECTION OF DIRECTORS
A Board of four Directors of the Company is to be elected at the Annual Meeting,
each to serve, subject to the provisions of the Company's by-laws, until the
next Annual Meeting of Stockholders and until his successor is duly elected and
qualified. It is management's recommendation that the accompanying form of Proxy
be voted FOR the election as Directors of the four persons named below, all of
whom are currently Directors of the Company. The Board of Directors believes
that the nominees named below are willing to serve as Directors. However, in the
event that any of the nominees should become unable or unwilling to serve as a
Director, the Proxy will be voted for the election of such person or persons as
shall be designated by the Directors. The Board of Directors does not have a
nominating committee. Dr. Andrzej J. Dabrowski has determined not to stand for
reelection to the Board of Directors but will continue in his capacity as
Executive Vice President and Chief Scientific Officer. After this election,
three vacancies will exist on the Board that are not intended to be filled at
this time.
The following persons are nominees for election as Directors:
Name Age Position
James W. Ward 57 Chairman of the Board of Directors
President and Chief Executive Officer
James A. Gordon 46 Director
Hayden Leason 65 Director
Jon B. Victor 44 Director
Set forth below is certain information relating to the other officers of the
Company:
Name Age Position
Andrzej J. Dabrowski 57 Executive Vice President,
Chief Scientific Officer, Director
Patrick J. Holmes 50 Vice President, Chief Financial Officer,
Corporate Secretary and Treasurer
Robert C. King 52 Vice President of Business Development
Harry Melkonian 46 Vice President-Operations, General Manager
James W. Ward, Chairman of the Board, President and Chief Executive Officer
Mr. Ward joined the Company on May 10, 1994 as President and Chief Executive
Officer and was elected Chairman of the Board effective February 28, 1995. Prior
to joining the Company, he was President and CEO of Boss Golf Company, Inc., a
company that he co-founded in September 1992. From 1990 to 1992, Mr. Ward
3
was President of Ling Electronics, Inc. a manufacturer of electrodynamic
vibration test systems worldwide. From 1980 through 1989, he was President of
two Gulton Industries, Inc. companies, Engineered Magnetics and Transrex. Mr.
Ward experienced a distinguished career with General Electric Company over a
period of 18 years, holding various management responsibilities in marketing,
engineering, manufacturing and quality assurance, primarily for the commercial
nuclear power generating plant business. He also served on the IEEE Standards
Committee that generated the IEEE Standard on Nuclear Quality Assurance. Mr.
Ward is a Registered Professional Engineer in California and past-recipient of
The Missouri Honor Award for Distinguished Service in Engineering from the
University of Missouri, Columbia. He holds a Bachelor of Science Degree and a
Master of Science Degree in electrical engineering from the University of
Missouri.
James A. Gordon, Director
Mr. Gordon became a director of the Company in August 1992. Since January 1992,
Mr. Gordon has been President of Gordon Management, Inc., which is the general
partner of Edgewater Private Equity Fund LP, a limited partnership formed for
investment purposes. In addition, Mr. Gordon has managed Focused Value Equity
portfolios since 1985. Since 1986, Mr. Gordon has been a member of the Board of
Directors of Bankers Trust Company (Iowa), and has served as Chairman of its
Trust and Investment Committee, as well as a member of both its Audit and Loan
Committees. He presently serves as a member of the Boards of Directors of the
following organizations: Grinnell College (also serving as Chairman of the
Investment Committee); IMNET, Inc.; SoftNet Systems, Inc.; HealthDesk, Inc.;
Cellular World Corp.; DAC Vision, Inc.; Microware Systems Corporation; Pride
Industries, Inc.; and Pangea, Inc. He is currently a Board member of the
National Committee for the Performing Arts of the Kennedy Center. Mr. Gordon
served as a member of the Board of Directors for Des Moines Art Center; Des
Moines Ballet; Des Moines Metro Opera; Governor's United Nations Board; Iowa
Society to Prevent Blindness; Des Moines Parent Teacher Association; Young
President's Organization; and Northwestern University Alumni Board.
Hayden Leason, Director
Mr. Leason became a director of the Company in July 1995. In 1965 Mr. Leason
founded Filtertek Inc., a designer and manufacturer of specialty filtration
elements, which subsequently became a New York Stock Exchange listed company. He
served as Chairman and Chief Executive Officer until 1992 when he sold his
interest to Schawk Inc. Since 1992, Mr. Leason has managed various private
investments. Mr. Leason is a 1954 graduate of Northwestern University where he
received his Bachelor of Science degree in Business Administration.
Jon B. Victor, Director
Mr. Victor became a director of the Company in June 1995. Mr. Victor is the
Manager of Greenwich Ventures, LLC, which is the general partner of Greenwich
Ventures, LP and Vantage Ventures, CV, Investment Partnerships which he
organized in 1996. He began his career in the equity research and trust
departments of the Bank of New
4
York. From 1978 through 1982 he worked for J. & W. Seligman & Co., where he was
responsible for offshore advisory relationships, and was President of the firm's
broker/dealer subsidiary. Mr. Victor founded Security Capital Management, Inc.,
an investment advisory firm, in 1983, and served as its President or
Co-President until 1996. In 1992, Mr. Victor co-founded Gordon Management, Inc.,
the general partner of Edgewater Private Equity Fund, LP, and Edgewater Private
Equity Fund II, LP. Mr. Victor is a 1973 magna cum laude graduate of Washington
University and a 1977 graduate of the George Washington University School of Law
where he earned his J.D. cum laude and completed his M.B.A. course work. Mr.
Victor serves on the Board of Directors of several private investment firms and
acts as an independent arbitrator for the National Futures Association.
Andrzej J. Dabrowski, Ph.D., Executive Vice President and Chief Scientific
Officer
Dr. Dabrowski has been a Director since the Company's inception in June 1988. He
served as President, Chief Executive Officer, and Treasurer of the Company from
June 1988 until June 1989. He rejoined the Company in April 1994 as Executive
Vice President and Chief Scientific Officer. Dr. Dabrowski was President and
Chief Executive Officer of ADI from its inception in June 1985 until January
1991. From January 1991 until November 1992, he served as Vice Chairman of ADI,
and since November 1992 until April 1994, again as that company's President. He
has been a director of ADI since its inception. Prior to these appointments, Dr.
Dabrowski served as Director of the Institute of Physics at the University of
Southern California (USC), School of Medicine and headed the Solid State Physics
Group within the Institute of Physics and Imaging Science, an applied research
group in the School of Medicine. Among other accomplishments, Dr. Dabrowski was
Vice Director of the Semiconductor Laboratory and Head of the Compound
Semiconductor Group at the Institute of Nuclear Research in Poland. He received
his Ph.D. in physics from the Institute of Nuclear Research in Swierk, Poland
and his master's degree in solid state physics from the University of Warsaw in
Poland.
Patrick J. Holmes, Vice President, Chief Financial Officer, Corporate
Secretary and Treasurer
Mr. Holmes joined the Company in August 1993. From 1989 until joining the
Company, Mr. Holmes was a Division Controller for Textron, Inc. From 1985 until
1989, he was Chief Accountant and Financial Operations Manager for two start-up
companies of Lockheed Corporation in Sunnyvale, CA. Previously, Mr. Holmes held
senior financial posts with General Dynamics and Datapoint Corporation. Mr.
Holmes, who is a Certified Public Accountant, received his degree in accounting,
magna cum laude, from the University of Missouri in St. Louis.
Robert C. King, Vice President of Business Development
Mr. King joined the Company in December 1995. From 1992 until joining the
Company, Mr. King was Vice President, Sales and Marketing of Medical Materials
Corporation. From 1989 until 1992, he was Vice President, Market and Business
Development of PCO, a subsidiary of Corning Incorporated and an affiliate of
IBM. From 1986 until 1989, he was Executive Vice President, Sales and Marketing
of Wangtek. Prior to 1986, Mr. King held sales and executive level positions for
Granger Associates, Q.T. Wiles and Associates, TRW Semiconductor and North
American Aviation. Mr. King holds a Bachelor of Science degree in Mechanical
Engineering, cum laude, from Ohio University in Athens, Ohio.
Harry Melkonian, Vice President of Operations and General Manager
Mr. Melkonian joined the Company in June 1992, and in 1993, he was appointed
General Manager of the Company's PIN Diode business. From 1989 until joining the
Company, Mr. Melkonian operated Melkonian Associates, a consulting firm that
assisted the Company in the acquisition of its subsidiary, Silicon Detector
Corporation. From 1987 until 1989, he was Director of Operations at Simulaser
Corporation; and for six years previously, he held various operations level
positions at Sensor Technology, Inc. Mr. Melkonian holds a Bachelor of Science
degree in Business Administration from Northeastern University.
Directors serve annual terms until the next annual meeting of stockholders and
until their successors are elected and qualified. Officers serve at the pleasure
of the Board of Directors. Pursuant to an agreement between the Company and D.H.
Blair, entered into in connection with a private placement offering of the
Company's capital in 1992, D.H. Blair has the right, at its option through
August 10, 1997, to designate one director to the Board of Directors of the
Company. To date, it has not exercised its option.
Meetings and Committees of the Board of Directors
The Board of Directors held five meetings during the fiscal year ended March 31,
1996 and acted by unanimous consent on one occasion. The Board of Directors has
the following standing committees: Audit Committee and Compensation Committee.
The Audit Committee reviews the accounting principles, the controls and scope of
the audit practices of the Company, and makes reports and recommendations to the
Board of Directors on those matters and with respect to the independent auditor.
It met one time in fiscal 1996. The members of the Audit Committee are Mr.
Leason, Chairman, Mr. Gordon and Mr. Victor.
The Compensation Committee was established to evaluate both Directors and
management compensation plans
5
as well as the Company's stock option and incentive plans. It met two times in
fiscal 1996. The members of the Compensation Committee are Mr. Victor Chairman,
Mr. Leason and Mr. Gordon.
Compensation of Directors
Directors and Committee members do not receive fees for their services. Each of
the Directors who is not an employee of the Company is eligible for grants of
stock options upon their appointment to the Board of Directors under the 1991
Special Directors Stock Option Plan ("Directors' Plan") and on an annual basis
so long as they remain on the Board. On October 18, 1995, the Board approved a
resolution to suspend participation in the Directors' Plan until the resolution
is thereafter countermanded. The resolution did not affect any options
previously granted under the Directors' Plan. All Directors, including employee
Directors, are reimbursed for reasonable travel expenses incurred in connection
with their attending meetings of the Board of Directors and Committees.
EXECUTIVE COMPENSATION
The following table sets forth compensation paid or accrued by the Company for
services rendered to the Company's Chief Executive Officer and to each of the
other executive officers of the Company whose cash compensation exceeded
$100,000 for services rendered during the last three fiscal years.
SUMMARY COMPENSATION TABLE
Long Term Compensation
------------------------------------
Annual Compensation Awards Payouts
Restricted Securities
Name and Other Annual Stock Underlying LTIP All Other
Principal Fiscal Salary Bonus Compensation Awards Options Payouts Compensation
Position Year ($) ($) ($) ($) (#) ($) ($)(1)
- -------- ---- ----- ----- ----- ----- ----- ----- -----
James W. Ward 1996 173,000 25,000 - - - - 4,700
Chairman of the Board, 1995 142,000 - - - 150,000 (3) - 3,600
President and Chief Executive
Officer (2)
- ---------------------------- ---------- ----------- --------- ---------------- ----------- ------------ ---------- --------------
Andrzej J. Dabrowski 1996 127,000 15,000 - - - - 3,900
Executive Vice President, 1995 115,000 - - - 75,000 (4) - 2,800
Chief Scientific Officer 1994 - - 5,000(5) - - - -
and Director
- ---------------------------- ---------- ----------- --------- ---------------- ----------- ------------ ---------- --------------
Patrick J. Holmes 1996 125,000 15,000 - - - - 3,800
Vice President, Chief 1995 125,000 - - - 80,000 - 3,800
Financial Officer Corporate 1994 79,000 - - - -(6) - 1,800
Secretary and Treasurer
- ---------------------------- ---------- ----------- --------- ---------------- ----------- ------------ ---------- --------------
Harry Melkonian 1996 110,000 15,000 - - - - 3,300
Vice President of Operations 1995 110,000 15,000 - - 60,000 - 3,300
& General Manager 1994 104,000 - - - - - 3,100
- ---------------------------- ---------- ----------- --------- ---------------- ----------- ------------ ---------- --------------
<FN>
1 Represents amounts paid by the Company on behalf of the named person in connection with the Company's 401(k) Retirement Plan.
2 Mr. Ward became President and Chief Executive Officer on May 10, 1994, and became Chairman of the Board on February 28, 1995.
3 Does not include 150,000 option shares granted in May 1994 which were canceled in January 1995. See "Ten-Year Option Repricings."
4 Does not include 75,000 option shares granted in April 1994 which were canceled in January 1995. See "Ten-Year Option Repricings."
5 Represents a portion paid of annual Board fees while Dr. Dabrowski was not an officer of the Company.
6 Does not include 60,000 option shares granted in August/October 1993 which were canceled in January 1995. See "Ten-Year Option
Repricings."
</FN>
6
EMPLOYMENT AGREEMENTS
James W. Ward entered into a two-year employment agreement with the Company on
January 16, 1996, pursuant to which he serves as President and Chief Executive
Officer. In addition, he was appointed Chairman of the Board on February 28,
1995. The Company has employment and termination agreements with certain other
employees, including Messrs. Dabrowski, Holmes and Melkonian. Under the terms of
all agreements, unless the Company gives notice within 90 days of the expiration
date, the agreements are renewed for one year. Employees may receive severance
pay under the agreements based upon the greater of the term of the contract or
up to nine months for Mr. Ward and six months for all others.
STOCK OPTIONS
The following tables set forth certain information concerning stock options
granted to and exercised by the persons named in the Summary Compensation Table
during the last fiscal year and unexercised stock options held by such persons
at the end of such fiscal year. No options were exercised during the last fiscal
year.
Option Grants in Fiscal 1996
Individual Grants
Number of Securities % of Total Options
Underlying Granted to Exercise or
Options Employees in Base Price Expiration
Name(1) Granted (#) Fiscal Year ($/Sh) Date
- ---- ------------- ------------ -------- -----
James W. Ward - - - -
Andrzej Dabrowski - - - -
Patrick J. Holmes - - - -
Robert C. King 60,000 60% 2.25 12/05/05
Harry Melkonian - - - -
- -------------------------------- --------------------- -------------------- ---------------------- -----------------------
<FN>
1 See "Summary Compensation Table" and Item 10 "Directors and Executive Officers" for principal position.
</FN>
Aggregated Option Exercises in Last Fiscal Year and FY-End Option Values
Value of Unexercised
Number of Securities Underlying In-the-Money Options at
Shares Acquired Unexercised Options at Fiscal Year End(#) Fiscal Year End ($)
Name1 on Exercise (#) Value Realized Exercisable/Unexercisable Exercisable/Unexercisable
- ---- ----------------- -------------- ------------------------- -------------------------
James W. Ward - - 60,000/90,000 82,500/123,750
Andrzej J. Dabrowski - - 147,000/45,000 106,250/61,875
Patrick J. Holmes - - 44,000/36,000 55,000/41,250
Robert C. King - - 12,000/48,000 8,250/33,000
Harry Melkonian - - 60,000/0 82,500/0
- ------------------------ ---------------- ---------------- ------------------------------------- --------------------------
<FN>
1 See "Summary Compensation Table" and Item 10 "Directors and Executive Officers" for principal position.
</FN>
7
On January 18, 1995 the Board of Directors canceled outstanding options to
purchase an aggregate of 365,000 shares of the Company's Class A Common Stock
and granted to the holders of such options new options to purchase an equivalent
number of shares. These options were the only options of the Company which have
been issued coincident with the cancellation of outstanding options or otherwise
repriced since the Company's inception through March 31, 1995. The Board of
Directors concluded that the subsequent decrease in the market price for the
Company's Class A Common Stock below the exercise price for the canceled options
was due to factors which were principally not all within the realm of
responsibility of the option holders and that the options no longer provided the
incentive to such option holders to perform on behalf of the Company in the
manner contemplated by the Board when the canceled options were initially
granted. On the date of the issuance of the new options and the cancellation of
the outstanding options, the closing sale price for the Company's Class A Common
Stock as reported on the American Stock Exchange was $1.56. The following table
sets forth certain information regarding the aforementioned canceled and new
options:
Ten-Year Option Repricings
Number of Securities Market Price of Exercise Price at Length of Original
Underlying Options Stock at Time of Time of New Option Term Remaining at
Repriced or Repricing or Repricing or Exercise Date of
Name1 Date Amended (#) Amendment ($) Amendment ($) Price ($) Repricing or Amendment
- ---- ---- ----------- ------------- ------------- --------- ----------------------
James W. Ward 1/18/95 150,000 1.56 3.25 1.56 9 years
Andrzej J. Dabrowski 1/18/95 75,000 1.56 3.31 1.56 9 years
Patrick J. Holmes 1/18/95 30,000 1.56 4.87 1.56 9 years
30,000 1.56 4.50 1.56 9 years
Harry Melkonian 1/18/95 60,000 1.56 3.62 1.56 7 years
- -------------------- ---------- -------------------- ----------------- ---------------- ---------- -------------------------
<FN>
1 See "Summary Compensation Table" and Item 10 "Directors and Executive Officers" for principal position.
</FN>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On May 16, 1995, the Company issued Bernhardt Denmark an option to purchase
400,000 shares of Class A Common Stock at an exercise price of $2.25 a share.
The option, which has a five-year term, was issued in connection with Mr.
Denmark's resignation from the Board of Directors, and in exchange for the
cancellation of options to purchase 400,000 shares of the Company's Class A
Common Stock at exercise prices ranging from $4.625 to $5.00 a share which were
originally granted to Mr. Denmark in 1992 and 1993 and which would have expired
by their terms three months after his resignation as a director.
RELATIONSHIP WITH INDEPENDENT AUDITORS
Arthur Andersen, independent auditors, audited the Company's financial
statements for fiscal years 1995-1996 and has been selected to audit the
Company's financial statements for fiscal year 1997. Representatives of Arthur
Andersen are expected to be present at the Annual Meeting to respond to
appropriate questions from stockholders and to make a statement if they desire
to do so.
EXPENSES
The entire cost of preparing, assembling, printing and mailing the Proxy
Statement, the enclosed Proxy, Annual Report and other materials, and the cost
of soliciting Proxies with respect to the Annual Meeting, will be borne by the
Company. The Company will request banks and brokers to solicit their customers
who beneficially own shares listed of record in names of nominees, and will
reimburse those banks and brokers for the reasonable out-of-pocket expenses of
such solicitations. The solicitation of Proxies by mail may be supplemented by
telephone and telegram by officers and other regular employees of the Company,
but no additional compensation will be paid to such individuals.
8
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the Annual Meeting of
Stockholders in 1997 must be received at its principal executive office no later
than May 22, 1997.
By Order of the Board of Directors
/s/ Patrick J. Holmes
Patrick J. Holmes
Secretary
Camarillo, California
September 23, 1996
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON SOLICITED BY THIS PROXY
STATEMENT, ON THE WRITTEN REQUEST OF ANY SUCH PERSON, A COPY OF THE COMPANY'S
ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED MARCH 31, 1996 AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION (INCLUDING THE FINANCIAL STATEMENTS AND THE
SCHEDULES THERETO, BUT EXCLUDING EXHIBITS). SUCH REQUESTS SHOULD BE DIRECTED TO
CORPORATE SECRETARY, 1240 AVENIDA ACASO, CAMARILLO, CALIFORNIA 93012.
9
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ADVANCED PHOTONIX, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 16, 1996
The undersigned hereby constitutes and appoints James W. Ward, Hayden Leason and
Jon B. Victor or any one of them, as proxies, with full power of substitution,
to vote all shares of stock of Advanced Photonix, Inc. (the "Company") which the
undersigned would be entitled to vote if personally present at the Annual
Meeting of Stockholders of the Company to be held at the Westlake Village Inn,
31943 Agoura Road, Westlake Village, California, at 10:00 o'clock A.M., Pacific
Time, on October 16, 1996, or at any adjournments or postponements thereof:
(1) Election of Directors
FOR all nominees listed below (except as marked to the contrary below) / /
WITHHOLD AUTHORITY to vote for all nominees listed below / /
James W. Ward, James A. Gordon, Hayden Leason, Jon B. Victor
(Instructions: To withhold authority to vote for any individual nominee, strike
a line through the nominee's name in the above list.)
(2) To transact such other business as may properly come before the meeting or
any adjournment or postponements thereof.
(PLEASE SIGN ON REVERSE SIDE)
- --------------------------------------------------------------------------------
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED, OR IF NO
SPECIFICATIONS ARE MADE, WILL BE VOTED BY THE PROXIES FOR THE ELECTION OF THE
ABOVE NOMINEES FOR DIRECTOR AND TO USE THEIR DISCRETION TO VOTE ON ANY OTHER
MATTER AS MAY PROPERLY COME BEFORE THE MEETING.
THE UNDERSIGNED HEREBY ACKNOWLEDGES RECEIPT OF THE NOTICE OF MEETING AND ANNUAL
REPORT FURNISHED HEREWITH.
Dated:_______________________,1996
_____________________________
Signature of Stockholder
_____________________________
Signature of Stockholder
Note: When signing as attorney-in-fact, executor, administrator, trustee or
guardian, please add your title as such, and if signer is a corporation, please
sign with full corporate name by duly authorized officer or officers and affix
the corporate seal. Where stock is issued in the name of two or more persons,
all such persons should sign. Please date, sign and return in the enclosed
envelope promptly.