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 Section 240. 14a-11(c) or Rule 14a-12
THERMODYNETICS, 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] No fee required.
[ ] 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:
TDYN Proxy 1st Dec.2001 (PROXY)
[Thermodynetics LOGO]
----------------------------------------
THERMODYNETICS, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
----------------------------------------
December 5, 2001
The Annual Meeting of Stockholders of Thermodynetics, Inc. (the "Company")
for fiscal year ended March 31, 2001 will be held at the Company's principal
offices at 651 Day Hill Road, Windsor, Connecticut 06095 on Wednesday, December
5, 2001 at 9:30 A.M. (EST) for the purpose of considering and acting upon the
following matters:
1. Election of three (3) directors (Proposal One).
2. Such other business as may properly come before the meeting or any
adjournment thereof.
Pursuant to the provisions of the By-Laws, the Board of Directors has fixed
the close of business on October 15, 2001 as the record date for determining the
stockholders of the Company entitled to notice of, and to vote at the meeting or
any adjournment thereof.
Stockholders who do not expect to be present in person at the meeting are
urged to date and sign the enclosed proxy and promptly mail it in the
accompanying postage-paid envelope. A prompt response will avoid the cost to the
Company of additional mailings of proxy solicitations.
By Order of the Board of Directors
Thermodynetics, Inc.
Robert A. Lerman
President
October 30, 2001
Windsor, Connecticut 06095
PLEASE COMPLETE AND PROMPTLY RETURN YOUR PROXY IN THE ENCLOSED ENVELOPE.
THIS WILL NOT PREVENT YOU FROM VOTING IN PERSON AT THE MEETING BUT WILL,
HOWEVER, HELP TO ASSURE A QUORUM AND AVOID ADDED PROXY SOLICITATION COSTS.
[Logo] THERMODYNETICS, INC.
--------------------
THERMODYNETICS, INC.
PROXY STATEMENT
--------------------
This Proxy Statement is first being mailed to Stockholders on or about
October 30, 2001 in connection with the solicitation of proxies by the Board of
Directors to be used at the Annual Meeting of Stockholders of Thermodynetics,
Inc., a Delaware corporation (the "Company"), to be held on Wednesday, December
5, 2001 at the Company's principal offices at 651 Day Hill Road, Windsor,
Connecticut 06095 at 9:30 A.M. (EST).
Accompanying this Proxy Statement is a Notice of Annual Meeting of
Stockholders, a form of Proxy for such meeting and the Company's Annual Report
for the fiscal year ended March 31, 2001 including financial statements with
respect to such year. All proxies which are properly filled in, signed and
returned to the Company in time will be voted in accordance with the
instructions thereon. Such proxies may be revoked by any stockholder prior to
the exercise thereof and stockholders who are present at the meeting may
withdraw their proxies and vote in person if they so desire. The Board of
Directors has fixed the close of business on October 15, 2001 as the record date
for the determination of stockholders who are entitled to notice of, and to vote
at the meeting or any adjournment thereof.
The expense of preparing, assembling, printing and mailing the form of
proxy and the material used in solicitation of proxies will be borne by the
Company. In addition to the solicitation of proxies by use of the mails, the
Company may utilize the services of some of its officers and regular employees
(who will receive no additional compensation therefor) to solicit proxies
personally, and by telephone and other communication mediums. The Company has
requested banks, brokers and other custodians, nominees and fiduciaries to
forward copies of the proxy material to their principals and to request
authority for the execution of proxies and may reimburse such persons for their
services in doing so.
Vote required, Principal Stockholders and Stockholdings of Management - The
presence, in person or by proxy, of the holders of a majority of the outstanding
shares of Common Stock of the Company is necessary to constitute a quorum at the
meeting. Election of directors (Proposal One) requires the affirmative vote of a
majority of the votes cast by the holders of Common Stock present in person or
by proxy at the meeting.
As of the record date, the Company had 13,848,110 shares of its Common
Stock issued and outstanding, the holders of which are entitled to one vote per
share.
The following table sets forth, as of the record date, the number of shares
of the Company's Common Stock owned beneficially to the knowledge of the
Company, by each beneficial owner of more than 5% of such Common Stock, by each
director, and by all officers and directors of the Company as a group. The
shares underlying the incentive stock options held by two officer/directors and
one officer which are presently exercisable are deemed as outstanding.
Name and Address(1) Amount and Nature Percent of
of Beneficial Owner of Beneficial Ownership Class Owned
Directors and Officers
John F. Ferraro 4,066,358 shs (2)(6) 25.7%
Robert A. Lerman 4,361,526 shs (2)(7) 27.6%
Anthony C. Mirabella 241,790 shs (3) 1.7%
Robert I. Lieberman 272,853 shs (4) 1.9%
All officers and 8,942,527 shs (5) 49.9%
directors as a group
(four persons)
Other 5% Shareholders
None
-----------------
(1) The address of all officers and directors is c/o the Company, 651 Day Hill
Road, Windsor, CT 06095.
(2) Includes options exercisable to acquire 1,948,182 shares; includes 60,196
shares held for Mr. Ferraro and 99,384 shares held for Mr. Lerman in trust
under the Company's 401(k) Plan, respectively; includes 244,525 shares held
by the spouse of Mr. Lerman, and 33,360 shares held by the spouse of Mr.
Ferraro, respectively; excludes the aggregate 1,134,803 shares held in
trust by the trustees of the 401(k) Plan for all of the participating
employees.
(3) Includes options exercisable to acquire 6,704 shares. Excludes the
aggregate 1,134,803 shares held in trust by the trustees of the 401(k) Plan
for all of the participating employees.
(4) Includes options exercisable to acquire 170,114 shares; includes 16,939
shares held in trust under the Company's 401(k) Plan.
(5) Includes options exercisable to acquire 4,073,182 shares; includes an
aggregate 176,519 shares held in trust under the Company's 401(k) Plan for
each respective officer's account; excludes the aggregate 1,134,803 shares
held in trust by the trustees of the 401(k) Plan for all of the
participating employees. Includes 244,525 shares held by the spouse of Mr.
Lerman, and 33,360 shares held by the spouse of Mr. Ferraro.
(6) The aggregate holdings of Company stock now owned by the John F. Ferraro
Defined Benefit Pension Plan and Trust established in 1984 equals 1,370,000
shares; Mr. Ferraro, as Trustee of that pension plan, has full voting
authority over that such shares which have been included Mr. Ferraro's
aggregate beneficial ownership calculation.
(7) The aggregate holdings of Company stock now owned by the Robert A. Lerman
Money Purchase Plan and Trust established in 1988 equals 1,291,880 shares;
Mr. Lerman, as Trustee of that pension plan, has full voting authority over
such shares which have been included in Mr. Lerman's aggregate beneficial
ownership calculation.
Holders of an aggregate 13,848,110 shares of the Company's Common Stock are
entitled to notice of and to vote at the Annual Meeting of Stockholders. The
Company's officers and directors, who have the right to vote an aggregate
4,869,345 shares representing thirty-five and two-tenths of one percent (35.2%)
of all shares which are entitled to be voted, have stated their intentions to
vote their shares FOR Proposal One.
ACTIONS TO BE TAKEN AT THE MEETING
ELECTION OF DIRECTORS
(Proposal One)
All directors shall serve until his successor is elected and is qualified.
The shares represented by proxies will be voted in favor of the election as
directors of the persons named below who are nominees for election and authority
to vote for the election of directors shall be deemed granted unless
specifically withheld. The Board of Directors has no reason to believe that any
of the nominees for the office of director will not be available for election as
a director. However, should any of them become unwilling or unable to accept
nomination for election, it is intended that the individuals named in the
enclosed proxy may vote for the election of such other person as the Board of
Directors may
recommend. The Company does not have a nominating, an audit or a compensation
committee. During the fiscal year ended March 31, 2001 the Company's Board of
Directors held a total of three (3) meetings.
Nominees for Election as Directors
Director
Name of Nominee Age Position with the Company Since
--------------- --- ------------------------- -----
John F. Ferraro 67 Chairman of the Board, Chief Executive
Officer and Secretary 1979
Robert A. Lerman 66 President and Director 1979
Anthony C. Mirabella 60 Director 1985
Principal Occupations of Directors and Nominees During the Past Five Years
Robert A. Lerman holds the degrees of Bachelor of Mechanical Engineering,
College of the City of New York (1957), Master of Science in Mathematics,
Adelphi College (1961), and Master of Science in Electrical Engineering,
University of Connecticut (1964). In 1979, Mr. Lerman was elected Treasurer and
a Director and in 1980 President of the predecessor to the Company. Since the
Company's 1981 merger, Mr. Lerman has been President and a Director of the
Company, and from 1981 through 1992 served as Treasurer. Mr. Lerman co-authored
the text book, Nonlinear Systems Dynamics, which was published in 1992 by Van
Nostrand Reinhold, New York, New York. In 1997, Mr. Lerman became President and
a Director of Pioneer Ventures Corp. ("PVC") and a manager of Ventures
Management Partners LLC ("VMP"), the general partner of Pioneer Ventures
Associates Limited Partnership ("PVALP"), a partnership formed for the purpose
of providing venture capital financing to other companies. In 1998, Mr. Lerman
became a director of Initio, Inc., Tristar Corporation, and Energy Brands, Inc.
In 2001, Mr. Lerman became Managing Director of Capital Management Partners, LLC
("CMP"), the general partner of Windsor Investors I Associates Limited
Partnership ("WinInv"), a partnership formed for the purpose of providing
venture capital financing to other companies. See "Certain Transactions".
John F. Ferraro holds the degree of Bachelor of Science in Industrial
Engineering, New York University (1962). In 1979, Mr. Ferraro was elected
Secretary and a Director of the predecessor to the Company. Since the Company's
1981 merger, Mr. Ferraro has been Chairman of the Board and Chief Executive
Officer of the Company. In 1997, Mr. Ferraro became Secretary and a Director of
PVC and a manager of VMP, the general partner of PVALP. In 1998 Mr. Ferraro
became a director of American Interactive Media, Inc.; in 1999 he became a
director of America's Shopping Mall, Inc.; and during the year 1998, and later
reappointed in 2000, Mr. Ferraro became a director of Fidelity First Financial
Corp. In 2001, Mr. Ferraro became a member of the Investment Committee of
WinInv. See "Certain Transactions".
Anthony C. Mirabella holds the degrees of Bachelor of Mechanical
Engineering, Stevens Institute of Technology (1962) and Master in Business
Administration, Western New England College (1969). He was elected a Director of
the Company in 1985. Mr. Mirabella was employed by Connecticut Natural Gas
Corporation from 1971 to 2000, and last served as a Senior Vice President of
said concern, responsible for the Energy Network, Inc. and its district heating
and cooling operations.
Executive Officers who are not Nominees for Director
Robert I. Lieberman is a certified public accountant. He holds the degree
of Bachelor of Science in Accounting and Business Administration from the State
University of New York (1975). Mr. Lieberman joined the Company as corporate
controller in 1986, in 1987 was elected Controller and Chief Financial Officer,
and in 1992 was elected Treasurer. In 1995 Mr. Lieberman was elected President
of Turbotec Products, Inc., the Company's principal operating subsidiary.
Certain Rights to Proceeds
Two of the Company's three directors, Messrs. Ferraro and Lerman, currently
own 656,334 shares in which the Company has certain rights to the proceeds to be
received upon the sale of such shares which they received pursuant to 1984 stock
subscription agreements, as amended in 1988 and in 1994. Upon the sale of any of
these shares, the selling director shall pay directly to the Company at the time
of receipt of the net proceeds of such sale, an amount equal to (i) such net
sales proceeds ($0.40 per share for Messrs. Ferraro and Lerman) less (ii) the
purchase price paid by the subscriber for each share sold (approximately $0.21
per-share). The directors retain full voting and dispositive control over these
shares. The Company has no other rights with respect to such shares.
Section 16(a) Beneficial Ownership Reporting Compliance
At the fiscal year end and through the date hereof, the Company had not
received any reports from any director, officer or principal shareholder which
indicated on the report, or by calculation based on the transaction and receipt
dates, that any report was not filed on a timely basis.
Remuneration of Officers and Directors
The following table sets forth on an accrual basis for the three most
recent fiscal years, the remuneration of each of the Company's officers whose
remuneration exceeded $100,000 and for all officers of the Company as a group.
SUMMARY COMPENSATION TABLE
Annual Long Term Compensation
-------------------------------------------
Compensation Awards Payouts Other
-------------------------------------------------------------------
Company
Name/Position Fiscal Other Stock Options/ LTIP 401(k)
Year Salary/Bonus Compensation Awards SARS Payouts Contrib.
------------- ---- ------------ ------------ ------ ---- -------- --------
John F. Ferraro (1) 2001 $173,207(2) $3,575 $0 0 shs $0 $489
Chairman of the Board, 2000 $170,760(2) $3,210 $0 0 shs $0 $518
Secretary & Director 1999 $173,151(2) $4,125 $0 0 shs $0 $499
Robert A. Lerman(1) 2001 $173,207(2) $4,726 $0 0 shs $0 $1,099
President & Director 2000 $176,852(2) $4,125 $0 0 shs $0 $1,096
1999 $173,151(2) $3,137 $0 0 shs $0 $1,073
Robert I. Lieberman(3) 2001 $127,788 $7,978 $0 0 shs $0 $0
Treasurer and CFO & 2000 $130,509 $11,878 $0 0 shs $0 $0
President of Turbotec 1999 $129,801 $14,228 $0 0 shs $0 $0
---------------------------------------------------
(1) Messrs. Ferraro and Lerman entered into five-year employment contracts
with the Company effective April 1, 1996, which agreements were each extended
for one additional five-year term under the provisions of the 1996 agreements.
Each employment contract provides for a basic salary at an initial annual rate
of $150,000 set in 1996 with an annual increase at April 1st of each year based
on increases in the Consumer Price Index. Each employment contract requires the
Company to provide medical and dental insurance coverage for the employee as
well as a maximum of $50,000 of group term insurance, and $1,500,000 of
additional life insurance. During the fiscal year ended March 31, 2001, the
Company paid $108,909 in net premiums on the two life insurance policies which
provide that upon death or surrender of the policy, the Company will be repaid
by the insurer and/or the insured the greater of the aggregate net premiums paid
by the Company or death benefit proceeds in excess of $1,500,000. At March 31,
2001, the amount receivable for premiums paid on the policies was $601,350. In
addition, each employment contract contained a provision providing that in the
event of disability, the employee will receive disability payments of $100,000
per year for ten years (with proportional reductions in the event of partial
disability); and $6,500 per year for tax planning services. The contract may be
terminated by the employee on 120 days prior written notice. The contract may
also be terminated by the Company in which event the employee will be paid
termination compensation equal to each employee's then current salary for either
the longer of the remainder of the unrenewed term or three years; in the event
there is a change in control of the Company and the employee is terminated, the
employee shall receive twice the amount of termination compensation which would
otherwise be due.
(2) In 2001, 2000 and 1999 Messrs. Ferraro and Lerman each received cash
bonuses of $10,000, $12,500 and $17,500, respectively.
(3) Mr. Lieberman entered into a five-year employment contract with the
Company's primary operating subsidiary effective April 1, 1996 which has been
renewed on a year-to-year basis. The contract provided for a base salary of
$110,000 for the first year, increased by $5,000 annually for each of the
following two years. In addition, the contract provided for bonus pay based on
performance targets established by the board of directors. The employment
contract required the Company to provide certain other benefits including life
and disability insurance, subject to a maximum cost per year. The contract
provided termination for "cause" immediately or by the employee on 90 days prior
written notice. The contract also provided for termination by the Company in
which event the employee would be paid termination compensation for 180 days.
For the fiscal year ending March 31, 2002, the Company anticipates paying
aggregate direct remuneration (based on current salaries and anticipated
bonuses) of approximately $500,000 to all officers as a group (three persons) of
which Mr. Ferraro and Mr. Lerman will each be paid approximately $180,000 and
Mr. Lieberman will be paid approximately $140,000.
During the fiscal year ended March 31, 2001, $3,961 in directors' fees and
expenses were paid to the Company's one director who is not an officer or
employee, Anthony C. Mirabella. It is anticipated that the one director/nominee
who is not an officer or employee will be paid approximately $5,000 in
directors' fees in the fiscal year ending March 31, 2002.
Incentive Stock Options
1992 Incentive Stock Option Plan. On December 16, 1991, the Company's
stockholders approved the adoption of the Company's 1992 Incentive Stock Option
Plan (the "1992 Plan") reserving 500,000 shares of the Company's Common Stock
for issuance pursuant to ISOs which may be granted under the 1992 Plan at
exercise prices at least equal to 100% of the fair market value of the Common
Stock on the date of the effective date of the grant of the option. At October
15, 2001 no 1992 Plan ISOs were outstanding.
As of the record date, no 1992 Plan ISOs were outstanding. No options under
the 1992 Plan were granted in fiscal year ended March 31, 2001. The 1992 Plan
will expire on December 31, 2001.
Non-Qualified Stock Incentive Plan
1995 Stock Options. On May 15, 1995, the Company's Board of Directors
approved the adoption of the 1995 Stock Options ("1995 Options") reserving
4,920,000 shares of the Company's Common Stock for issuance in the form of stock
options. The purchase price for the exercise of shares subject to the options
equaled the fair market value ("FMV") of the shares of common stock of the
Company on the effective date of the option, May 19, 1995. A total of 590,000
options were reassigned in August, 1999 and were granted to members of the
management team pro rata in accordance with their terms. The expiration date of
the options is September 30, 2002. See also Aggregated Exercises and Certain
Transactions.
Option Grants in Last Fiscal Year. No options were granted in the last
fiscal year. However, 590,000 of the 1995 Options were reassigned in August,
1999 as follows: 268,182 to Mr. Lerman, 268,182 Mr. Ferraro, 20,114 to Mr.
Lieberman, 6,704 to Mr. Mirabella, and 26,818 to two other individuals.
Aggregated Exercises
Aggregated Option/SAR Exercises and Fiscal Year End Option/SAR Values. No
options were exercised by certain executive officers of the Company during
fiscal year ended March 31, 2001. See also "1995 Stock Options", "Option Grants
in Last Fiscal Year", and "Certain Transactions". The following table reflects
the aggregated option exercise values at year end held by the executive officers
and directors:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
----------------------------------------------------------------------------------------------------------
Number of
Securities Value of
Underlying Unexercised
Unexercised in-the-Money
Shares Options at Options at
Acquired FY-End FY-End ($)
Name of on Value Exercisable ("E") Exercisable ("E")
Officer or Director Exercise Realized Unexercisable ("U") Unexercisable ("U")
----------------------------------------------------------------------------------------------------------
John F. Ferraro 0 $0 1,948,182 E $214,300 E
Robert A. Lerman 0 $0 1,948,182 E $214,300 E
Anthony C. Mirabella 0 $0 6,704 E $737 E
Robert I. Lieberman 0 $0 170,114 E $18,713 E
----------------------------------------------------------------------------------------------------------
The compensation values of stock incentives and stock bonuses, if any were
issued or awarded, received by the named executive officers and directors of the
Company during the last three fiscal years are reflected in the Summary
Compensation Table at the column labeled "Restricted Stock Awards".
Employee Retirement Savings Plan
Effective April 1, 1991, the Company adopted the Thermodynetics, Inc.
401(k) Retirement Savings Plan (the "401(k) Plan"). The Company has determined
its matching contributions to the 401(k) Plan for the plan year ending December
31, 2001 will equal a maximum of 200,000 shares of the Company's common stock,
provided that the value of such grant does not exceed $35,000. The assets of the
401(k) Plan are held in trust for the exclusive benefit of the participants by
the trustees of the Plan, Messrs. Ferraro, Lerman and Mirabella as the trustees.
The compensation value of the 401(k) participation received by the below
listed officers and directors is reflected in the Summary Compensation Table at
the column labeled "Company 401(k) Contribution" at the section labeled
"Remuneration of Officers and Directors". The following table sets forth the
number of shares of Common Stock contributed to the below referenced persons or
groups of persons during the 401(k) Plan year ended December 31, 2000, Column
(1), and for all years from inception of the Plan through Plan year ended
December 31, 2000 Column (2).
Shares Contributed by the Company
Name and Held in Trust Under 401(k) Plan
---- -----------------------------------
Officers and Directors Column (1) Column (2)
---------------------- ---------- ----------
(Aggregate)
John F. Ferraro(a) 8,896 60,196
Robert A. Lerman(a) 19,987 99,384
Robert I. Lieberman -0- 16,939
Anthony C. Mirabella(a) -0- -0-
All officers and directors as a group(a) 28,883 176,519
(4 persons)
Total Matching Contribution 200,000 1,134,803
to all employees (35 persons)
---------------
(a) Trustees of the 401(k) Plan. Excludes the aggregate shares held in
trust by the trustees of the 401(k) Plan for all participating
employees.
Other Plans
The Company does not have any pension or similar plan. See footnotes (1)
and (4) to the cash compensation table as to the Company's employment contracts
with Messrs. Ferraro, Lerman and Lieberman containing disability and termination
payment provisions.
Certain Transactions
During the fiscal year ended March 31, 2001, the Company has not been
engaged in transaction(s) with officers, directors, or beneficial holders of
more than 5% of its outstanding voting securities and entities with which they
were affiliated, except as stated below. None of the officers and directors of
the Company are engaged in businesses competitive to the business of the
Company. The Company's transactions with these individuals and entities in the
fiscal year most recently ended are described below.
With Directors and Officers, and Related Persons. In August, 1999 a total
of 590,000 of the 1995 stock options were reassigned to the management team pro
rata in accordance with their terms. See "1995 Stock Options" and "Option Grants
in Last Fiscal Year."
Indebtedness of Management - At March 31, 2001 no member of management was
indebted to the Company in excess of $60,000.
Legal Proceedings
There are no material legal proceedings known or threatened against the
Company.
Information Concerning Independent Public Auditors
The firm of DiSanto Bertoline & Company, P.C., certified public
accountants, audited the consolidated financial statements of the Company and
its subsidiaries for the fiscal year ended March 31, 2000. DiSanto Bertoline &
Company, P.C. was first appointed to serve as the Company's auditors in
February, 1991. Representatives of such firm are not expected to be present at
the Annual Meeting of Stockholders.
On November 30, 2000, the Registrant replaced its principal accountant,
DiSanto, Bertoline & Company, P.C., 628 Hebron Avenue, Glastonbury, Connecticut
06033 with Mahoney Sabol & Company, LLP, One State Street, 17th floor, Hartford,
Connecticut 06103. The former accountant's reports on the Registrant's financial
statements for each of the past two years contained no adverse opinion or a
disclaimer of opinion, nor were such reports qualified or modified as to
uncertainty, audit scope, or accounting principles. The decision to change
accountants was approved by the Registrant's board of directors. During the
Registrant's two most recent fiscal years ending March 31, 2001, and during the
period from April 1, 2000 through and including November 30, 2000, there were no
disagreements between the Registrant and the former accountant on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure. During the Registrant's two most recent fiscal years ending
March 31, 2001, and during the period from April 1, 2000 through and including
November 30, 2000, the former accountants did not advise the Registrant that:
(a) internal controls necessary for the Registrant to develop reliable financial
statements did not exist; (b) information had come to the former accountant's
attention that led it to no longer be able to rely on management's
representation or that made it unwilling to be associated with the financial
statements prepared by management; (c) the former accountant needed to expand
significantly the scope of its audit, or that information had come to the former
accountant's attention that, if further investigated might have materially
impacted the fairness or reliability of a previously issued audit report or the
underlying financial statements, or the financial statements issued or to be
issued covering the fiscal period subsequent to the date of the most recent
audited financial statements, and the issue was not resolved to the former
accountant's satisfaction prior to its dismissal.
On November 30, 2000 the Registrant engaged Mahoney Sabol & Company, LLP,
One State Street, 17th floor, Hartford, Connecticut 06103 to be its principal
accountant. During the Registrant's two most recent fiscal years ending March
31, 2000 and during the period from April 1, 2000 through and including November
30, 2000, the Registrant had not consulted the newly engaged accountant
regarding: (a) either the application of accounting principles to a modified
transaction, completed or proposed, or the type of audit opinion that might be
rendered on the Registrant's financial statements, and no written report or oral
advice was provided that the new accountant concluded was an important factor
considered by the Registrant in reaching a decision as to the accounting,
auditing or financial reporting issue; or (b) any matter that was either the
subject of a disagreement with the former accountant or a reportable event.
Representatives of Mahoney Sabol & Company, LLP are not expected to be present
at the Annual Meeting of Stockholders.
Stockholder Proposals for Next Annual Meeting
Under current rules of the Securities and Exchange Commission, stockholders
wishing to submit proposals for inclusion in the Proxy Statement of the Board of
directors for the 2002 fiscal year end Annual Meeting of Stockholders must
submit such proposals so as to be received by the Company at 651 Day Hill Road,
Windsor, Connecticut 06095 on or before July 1, 2002.
Form 10-KSB Annual Report
A copy of the Company's Annual Report on Form 10-KSB for the year ended
March 31, 2001 as filed with the Securities and Exchange Commission may be
obtained by any stockholder entitled to vote at the December 5, 2001 Annual
Meeting of Stockholders by addressing a written request to the Secretary,
Thermodynetics, Inc., 651 Day Hill Road, Windsor, Connecticut 06095.
OTHER MATTERS
Management does not know of any other matters which are likely to be
brought before the Meeting. However, in the event that any other matters
properly come before the Meeting, the persons named in the enclosed proxy will
vote said proxy in accordance with their judgment on said matters.
By Order of the Board of Directors
Thermodynetics, Inc.
Robert A. Lerman
President
Windsor, Connecticut 06095
October 30, 2001
PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS PROXY
Please Sign and Return this Proxy Promptly
THERMODYNETICS, INC.
Annual Meeting of Stockholders - December 5, 2001
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby appoints John
F. Ferraro and Robert A. Lerman, or any one of them acting in the absence of the
other, as attorneys and proxies of the undersigned with full power of
substitution, for and in the name of the undersigned, to represent the
undersigned at the Annual Meeting of Stockholders of Thermodynetics, Inc., a
Delaware corporation, to be held at the Company's principal offices at 651 Day
Hill Road, Windsor, Connecticut 06095 at 9:30 A.M. (EST) on Wednesday, December
5, 2001 and at any adjournments thereof, and to vote all shares of stock of said
Company standing in the name of the undersigned with all the powers which the
undersigned would possess if personally present at such meeting. The undersigned
directs that this Proxy be voted as follows:
1. To elect three (3) directors (Proposal One).
FOR [_] all nominees listed below WITHHOLD AUTHORITY [_]
(except as marked to the contrary below) (to vote for all nominees
listed below)
Nominees: John F. Ferraro, Robert A. Lerman, Anthony C. Mirabella
If it is desired to withhold authority to vote for any individual
nominee, check the FOR box above and strike out the name of the
nominee for whom you desire to withhold voting authority.
2. In their discretion, on all other matters that may properly come before the
meeting.
AUTHORITY GRANTED [_] AUTHORITY WITHHELD [_]
(Continued and to be signed
on other side)
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE GIVEN FOR
ANY ITEM, THIS PROXY WILL BE VOTED FOR THAT ITEM. DISCRETIONARY AUTHORITY IS
HEREBY CONFERRED AS TO ALL OTHER MATTERS THAT MAY COME BEFORE THE MEETING.
STOCKHOLDERS WHO ARE PRESENT AT THE MEETING MAY WITHDRAW THEIR PROXY AND VOTE IN
PERSON IF THEY SO DESIRE.
Dated: 2001
--------------------
------------------------------
------------------------------
(Signature of Stockholder)
Please sign exactly as name
appears on this Proxy. If
shares are registered in more
than one name, the signatures
of all such persons are
required. A corporation should
sign in its full corporate
name by a duly authorized
officer, stating his title.
Trustees, guardians, executors
and administrators should sign
in their official capacity,
giving their full title as
such. If a partnership, please
sign in partnership name by
authorized person.
PLEASE SIGN AND RETURN THIS PROXY PROMPTLY
No postage is required if returned in the enclosed
envelope and mailed in the United States THIS PROXY
IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS