DISPLAY TECHNOLOGIES, INC.
(CORP. NM. LA-MAN CORPORATION)
5029 Edgewater Drive
ORLANDO, FLORIDA 32810
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD OCTOBER 29, 1998
The Annual Meeting of shareholders of La-Man Corporation dba Display
Technologies, Inc. (the "Company") will be held on Thursday, October 29, 1998,
at 10:00 a.m., local time, at the Ramada Inn North, 2025 West State Road 434,
Longwood, Florida 32779 for the following purposes, all of which are described
in the accompanying Proxy Statement:
1. To elect 11 members to the Board of Directors of the Company to serve until
the next annual meeting of shareholders or until their successors are
elected and qualified;
2. To consider and act upon the adoption of the Company's Restated Articles of
Incorporation, attached as Exhibit A, which contain certain provisions: (a)
---------
changing the name of the Company to Display Technologies, Inc.; and (b)
authorizing the issuance of up to 50,000,000 shares of preferred stock.
3. To consider and act upon the ratification of the appointment of BDO
Seidman, LLP as the Company's independent auditor for the June 30, 1999
fiscal year;
4. To consider and act upon such other business as may properly come before
the Meeting or any adjournment thereof.
The accompanying proxy is solicited by the Board of Directors of the
Company. The Company's Proxy Statement and Annual Report for the fiscal year
ended June 30, 1998 are enclosed.
The record date for the determination of shareholders entitled to vote at
the Meeting is September 15, 1998, and only shareholders of record at the close
of business on that date will be entitled to vote at the Meeting or any
adjournment thereof.
YOUR VOTE IS IMPORTANT! WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING,
PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY IN THE ENCLOSED
PREPAID ENVELOPE SO THAT WE MAY BE ASSURED OF A QUORUM TO TRANSACT BUSINESS. IF
YOU ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND VOTE IN PERSON.
By Order of the Board of Directors,
Orlando, Florida J. WILLIAM BRANDNER
September 15, 1998 President and Chief Executive Officer
DISPLAY TECHNOLOGIES, INC.
(corp. nm. La-Man Corporation)
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
OCTOBER 29, 1998
INTRODUCTION
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
the enclosed proxy by the Board of Directors of La-Man Corporation, a Nevada
corporation dba Display Technologies, Inc. (the "Company"), for use at the
Annual Meeting of Shareholders to be held on Thursday, October 29, 1998, at
10:00 a.m., local time, at the Ramada Inn North, 2025 West State Road 434,
Longwood, Florida 32779 (the "Annual Meeting"), and at any adjournment thereof.
The Annual Meeting is being held to consider and vote on: (a) the election of 11
persons to serve as members of the Company's Board of Directors; (b) the
adoption of Restated Articles of Incorporation changing the Company's corporate
name to Display Technologies, Inc. and creating a new class of preferred stock;
and (c) the ratification of the appointment of BDO Seidman, LLP as the
Company's independent auditor for the June 30, 1999 fiscal year; and to consider
and act on any other business that may properly come before the meeting.
The principal executive offices of the Company are located at 5029
Edgewater Drive, Orlando, Florida 32810. This Proxy Statement, the enclosed
form of proxy and the Company's Annual Report for the fiscal year ended June 30,
1998 (the "1998 Fiscal Year") are being sent to shareholders commencing on or
about September 21, 1998. The Company's 1998 Annual Report was first delivered
to certain shareholders on September 9, 1998.
RECORD DATE, VOTING RIGHTS, AND REVOCABILITY OF PROXIES
The Board of Directors has fixed September 15, 1998 as the record date (the
"Record Date") for the Annual Meeting. Only shareholders of record at the close
of business on that day will be entitled to notice of and to vote at the Annual
Meeting and any adjournments thereof. As of the Record Date, 1998, there were
4,926,750 shares of the Company's common stock, par value $.001 per share
("Common Stock"), issued and outstanding.
Holders of record of Common Stock on the record date are entitled to cast
one vote per share, by person or by proxy authorized in writing, at the Annual
Meeting. Shares represented by a properly executed proxy in the accompanying
form will be voted at the Annual Meeting and, when instructions have been given
by the shareholder, will be voted in accordance with those instructions. If no
instructions are given, the shares will be voted according to the
recommendations of the Board of Directors of the Company (the "Board of
Directors" or the "Board"). Other than the election of Directors, which
requires a plurality of the votes cast, each matter to be submitted to the
shareholders requires the affirmative vote of a majority of the votes cast at
the meeting. Abstentions and broker non-votes are counted only for purposes of
determining whether a quorum is present at the meeting.
A shareholder may revoke a proxy at any time before its exercise by sending
written notice of revocation to the Secretary of the Company, or by signing and
delivering a proxy which is dated later, or, if the shareholder attends the
Annual Meeting in person, either by giving written notice of revocation to the
inspectors of election at the Annual Meeting or by voting at the meeting.
PROPOSAL 1
ELECTION OF DIRECTORS
Eleven persons are to be elected at the Annual Meeting to serve as
Directors for a term of one year or until the election and qualification of
their successors. It is the intention of the persons named in the enclosed
proxy to vote proxies FOR the election of the nominees named below. If any
nominee refuses or is unable to serve as a Director (which is not anticipated),
the persons named as proxies reserve full discretion to vote for any or all
other persons who may be nominated. The 11 nominees receiving the greatest
number of votes will be elected to serve on the Board of Directors.
The nominees for election to the Board of Directors are as follows:
DIRECTOR
NAME POSITION AND OFFICES WITH THE COMPANY SINCE AGE
- ----------------------------- ------------------------------------------------ -------------- --------
J. Melvin Stewart Chairman of the Board; Director 1994 79
J. William Brandner President and Chief Executive Officer; Director 1994 61
Gary Donald Bell President, Don Bell Industries, Inc.; Director 1995 49
Edwin M. Freakley Director 1995 54
Thomas N. Grant Director 1995 52
Philip Howe Hoard Vice President; Secretary; Director 1987 64
Lester Jacobs Director 1997 60
Terry J. Long President, Ad Art Electronic Sign Corporation; 1998 53
Director
Lou A. Papais Consultant, Director 1998 72
William A. Retz Director 1997 58
Robert M. Smither Director 1995 44
BUSINESS EXPERIENCE OF NOMINEES
J. MELVIN STEWART has served as a Director of the Company since February
1994 and as Chairman of the Board since September 29, 1994. He also serves as a
member of the Executive Committee and the Nominating Committee of the Board of
Directors, and serves as Chairman of the Board, President and Chief Executive
Officer of Nevada SEMCO, Inc. ("SEMCO"), and as President and Chief Executive
Officer of J.M. Stewart Corporation ("Stewart Corporation") and J.M. Stewart
Industries, Inc. ("Stewart Industries"), all subsidiaries of the Company. Mr.
Stewart served in such capacities at Stewart Corporation and Stewart Industries
for more than five years.
J. WILLIAM BRANDNER has served as President and Chief Executive Officer and
as a Director since April 1994, and also serves as a member and Chairman of the
Executive Committee and as a member of the
2
Nominating Committee. From April 1991 to July 1993, Mr. Brandner served as
Chairman and President of American Integrity Corporation, a public insurance
holding company with revenues of more than $100 million. From July 1971 to
October 1990, Mr. Brandner served as Vice Chairman, Director and in various
other senior executive positions with Harcourt Brace Jovanovich, Inc., a $1.8
billion diversified public company with publishing, insurance and theme park
operations.
GARY DONALD BELL has served as a Director since October 1995. He has
served the last six years as President of Don Bell Industries, Inc. ("Don Bell
Industries").
EDWIN M. FREAKLEY has served as a Director and member of the Executive
Committee since October 1995, as a member of the Audit Committee of the Board of
Directors from March 1996 to October 1997, and as a member of the Nominating
Committee since August 1997. Mr. Freakley has been President and Chief
Executive Officer of Worrell Enterprises, Inc. ("Worrell"), a private publishing
and management company, since before 1990.
THOMAS N. GRANT has served as a Director, as a member and Chairman of the
Compensation Committee of the Board of Directors since October 1995, as a member
of the Audit Committee from March 1996 until October 1997, and as a member of
the Executive Committee since October 1997. Since January 1997, Mr. Grant has
been First Vice President, Financial Institutions, SunTrust Bank, Central
Florida, N.A. From 1993 to 1996, he served as Senior Vice President and Senior
Lending Officer of The Bank of Winter Park, Winter Park, Florida.
PHILIP H. HOARD has served as Vice President, Secretary and as a Director
of the Company since April 1987. Mr. Hoard has also served as Director of
Purchasing for the Company since March 1985, and as Plant Manager from April
1987 to present.
LESTER JACOBS has served as a Director and member of the Audit and
Compensation Committees since October 1997. He has also served as Chairman of C
12 Group since 1992, an interactive peer study and support system for
individuals who own or are the chief executive officer of small-to medium-sized
businesses in the Florida cities of Tampa, Bradenton and Sarasota, and in
Houston, Texas. J. Melvin Stewart is a member of the C 12 Group in Sarasota,
Florida.
TERRY J. LONG has served as a Director since February 1998 and is President
and Chief Executive Officer of Ad Art Electronic Sign Corporation ("Ad Art"),
which was acquired by the Company in February 1998. Since 1985, Mr. Long has
served as the President of Ad Art and its predecessor companies.
LOU A. PAPAIS has served as a Director, as a member of the Audit and
Nominating Committees, and as a consultant to Ad Art since February 1998. Mr.
Papais founded Ad Art with his brother John in 1953 and was its principal
shareholder prior to its acquisition by the Company.
WILLIAM A. RETZ, Rear Admiral USN (Ret.), has served as a Director and
member of the Audit and Compensation Committees since October 1997. He has also
served since 1996 as Vice President, Government Services, for Aramark Corp., a
large privately-held company which provides food and other services to a variety
of industries. Admiral Retz served in the United States Navy from 1963 to 1995
with a variety of sea commands and shore assignments, including several U.S.
Navy personnel management positions and positions of responsibility for naval
bases, including closure of the U.S. Navy base in Philadelphia, Pennsylvania.
3
ROBERT M. SMITHER, JR. has served as a Director and member of the
Compensation Committee since October 1995. Mr. Smither has also served as a
member and Chairman of the Audit Committee since March 1996, and has been Vice
President and Treasurer of Worrell since before 1990.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" ELECTION OF THE NOMINEES
LISTED ABOVE AS DIRECTORS
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors presently has four committees: an Audit Committee; a
Compensation Committee; an Executive Committee; and a Nominating Committee.
The present members of the Audit Committee are Lester Jacobs, Lou A.
Papais, William A. Retz, and Robert M. Smither, Jr. (Chairman).
The present members of the Compensation Committee are Thomas N. Grant
(Chairman), Robert M. Smither, Jr., Lester Jacobs and William A. Retz.
The present members of the Executive Committee are J. William Brandner
(Chairman), Edwin M. Freakley, J. Melvin Stewart and Thomas N. Grant.
The present members of the Nominating Committee are J. William Brandner,
Edwin M. Freakley (Chairman), Lou A. Papais and J. Melvin Stewart. In order for
the Nominating Committee to consider shareholder recommendations for nominees,
such recommendations must be received in writing by the President of the Company
not less than 120 days prior to the annual meeting of shareholders.
In order for any action to be taken by a committee, it must be approved by
the affirmative vote of not less than a majority of the committee members. Any
action to be taken by a committee may be taken in lieu of a meeting by unanimous
written consent of the members, in the same manner as legally required if such
action were taken by the Board by written consent. During the 1998 Fiscal Year,
the Board of Directors held four meetings, the Executive Committee met once, the
Compensation Committee met three times, the Audit Committee met once and the
Nominating Committee held no meetings. Except for Mr. Freakley, each incumbent
Director attended 75% or more of the total number of Board meetings and, to the
extent he was a member, committee meetings. Mr. Freakley attended 71% of the
aggregate number of meetings of the Board and all committees of the Board on
which he served.
The Audit Committee and Compensation Committee are comprised of four
Directors, none of whom may be an officer or employee of the Company or any of
its subsidiaries. The Executive Committee and the Nominating Committee are
comprised of four directors, two of whom may not be an officer or employee of
the Company or any of its subsidiaries. Directors are appointed to the various
committees at the Board"s annual meeting.
The Company"s Articles of Incorporation provide that the Company is to
indemnify its executive officers and directors to the fullest extent allowed by
Nevada law. Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended (the "Securities Act"), may be permitted to
directors, officers or persons controlling the Company, the Company has been
advised that it is the position of the
4
Securities and Exchange Commission (the "SEC") that such indemnification is
against public policy as expressed in the Securities Act and therefore is
unenforceable.
COMPENSATION OF DIRECTORS
Members of the Board of Directors who are not also employees of the Company
or any of its subsidiaries are paid a fee of $1,000 for each Board meeting
attended and are reimbursed their costs in attending meetings. In addition,
under the terms of the Company's 1992 Stock Option and Appreciation Rights Plan
(the "1992 Plan"), non-employee Directors are entitled to receive, in November
of each year in which they serve as Directors, grants of options to purchase
10,000 shares of Common Stock at an exercise price equal to the per share fair
market value of the Common Stock on the date of grant. For further information
concerning options granted under the 1992 Plan, see "1988 and 1992 stock option
plans," below. During the 1998 Fiscal Year, Directors Stewart, Brandner, Bell,
Long and Hoard were also employees of the Company or one or more of its
subsidiaries for all or part of the year. Employee-Directors are reimbursed
costs incurred by them in attending meetings of the Board and various
committees, but receive no additional compensation for acting as Directors or as
members of any committee.
SECURITIES OWNED BY PRINCIPAL SHAREHOLDERS
AND MANAGEMENT
The following table sets forth, as of September 15, 1998, certain
information with respect to the stock ownership of: (a) all persons known by the
Company to be record or beneficial owners of five percent (5%) or more of the
outstanding Common Stock; (b) each nominee for election as a Director; (c)
certain executive officers; and (d) all Directors and executive officers as a
group (12 persons).
NAME AND ADDRESS NUMBER OF SHARES PERCENT OF
OF BENEFICIAL OWNER BENEFICIALLY OWNED /1/ CLASS /1/,/2/
- -------------------------------------- ------------------- -----------
Gary D. Bell 214,484 /3/ 4.2%
365 Oak Place
Port Orange, Florida 32127
J. William Brandner 314,057 /3/ 6.1%
5029 Edgewater Drive
Orlando, Florida 32810
Edwin M. Freakley 0 0.0%
1450 South Dixie Highway
Boca Raton, Florida 33432
Thomas N. Grant 17,010 /3/ *
200 South Orange Avenue
Orlando, Florida 32810
Philip Howe Hoard 223,729 /3/ 4.4%
700 Glades Court
Port Orange, Florida 32127
5
Lester Jacobs 10,500 /3/ *
656 Flamingo Drive
Apollo Beach, Florida 33572
Terry J. Long 262,000 /3/,/4/ 5.2%
3133 Ad Art Road
Stockton, California 95215
Lou A. Papais 648,000 /4/ 13.2%
3133 Ad Art Road
Stockton, California 95215
William A. Retz 10,500 /3/ *
280 South Ridley Creek Road
Media, Pennsylvania 19063
Robert M. Smither, Jr. 0 0.0%
1450 South Dixie Highway
Boca Raton, FL 33432
J. Melvin Stewart 582,997 /3/,/6/ 11.4%
2201 Cantu Court
Sarasota, Florida 34232
Todd D. Thrasher 34,590 /3/ *
5029 Edgewater Drive
Orlando, Florida 32810
Worrell Enterprises, Inc. 489,281 /5/ 9.7%
1450 South Dixie Highway
Boca Raton, Florida 33432
All Executive Officers and Directors 2,314,321 /7/ 39.7%
as a Group (12 persons)
*Represents less than 1% of the outstanding shares of Common Stock.
_____________________________
/1/Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), includes as beneficial owners of securities, among others,
any person who directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares voting power and/or
investment power with respect to such securities, and any person who has the
right to acquire beneficial ownership of securities within 60 days, including
without limitation, the exercise of any option, warrant or conversion of a
security.
/2/Based upon 4,926,750 shares of Common Stock issued and outstanding.
/3/Includes the following number of shares purchasable within 60 days of the
Record Date: J. Melvin Stewart 201,275 shares; J. William Brandner 240,345
shares; Gary D. Bell 162,938 shares; Philip H. Hoard 127,920 shares; Terry J.
Long 100,000 shares; Thomas N. Grant 14,805 shares; Lester Jacobs 10,500
shares; William A. Retz 10,500 shares; and Todd D. Thrasher 31,500 shares.
6
/4/Does not include up to 108,000 shares contingently issuable to Mr. Long and
432,000 contingently issuable to Mr. Papais pursuant to rights granted in the
Company's acquisition of Ad Art. See "CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS--Acquisition of Ad Art Electronic Sign Corporation."
/5/Includes: (a) 29,610 shares purchasable within 60 days of the Record Date
pursuant to outstanding options; and (b) 110,250 shares purchasable upon
exercise of conversion rights under a $500,000 Convertible Promissory Note.
Worrell will be represented on the Board of Directors by Messrs. Freakley and
Smither, if elected, who individually do not beneficially own any shares of
Common Stock.
/6/Includes 305,000 shares of Common Stock under a Voting Trust Agreement
among Mr. Stewart, his six children and a trust for the benefit of a
grandchild. The term of the agreement is 10 years from May 19, 1998. Mr.
Stewart serves as the sole trustee and has full voting power with respect to
the shares held in trust under the agreement.
/7/Does not include the following shares allocated to the following persons'
accounts under the Company's 401(k) plan as of the last quarterly allocation
reported by the plan administrator: Gary D. Bell 1,160; J. William Brandner
7,924; Philip Howe Hoard 4,803; J. Melvin Stewart 6.838; and Todd D. Thrasher,
1,725.
As of September 15, 1998, the Company did not know of any arrangement,
including any pledge by any person of securities of the Company, the operation
of which may result at a subsequent date in a change in control of the Company.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Rule 16a-3(e) under the Exchange Act requires the Company's directors and
executive officers and the holders of 10% or more of the Company's Common Stock
to file with the SEC initial reports of ownership and reports of changes in
ownership of equity securities of the Company. The Company believes that all
reports pursuant to Section 16(a) with respect to the 1998 Fiscal Year were
timely filed, except as follows: Bishop Ithiel C. Clemmons, who served as a
Director until October 31, 1997, failed to timely file one Form 4 report with
respect to a transaction in June 1997; and each of Kenneth Overby and Douglas
Ward, who became officers of the Company in October 1997, failed to timely file
one Form 3 report. All of the foregoing reports, except for that of Bishop
Clemmons, have since been filed.
EXECUTIVE OFFICERS
The following table lists the Company's executive officers as of the date
of this Proxy Statement and includes certain other information concerning them.
7
NAME AGE POSITIONS WITH COMPANY
- --------------------- --- -------------------------------------
J. Melvin Stewart 79 Chairman of the Board
J. William Brandner 61 President and Chief Executive Officer
Philip Howe Hoard 64 Vice President and Secretary
Todd D. Thrasher 31 Vice President, Treasurer (Chief
Financial Officer) and Assistant Secretary
Executive officers hold office at the pleasure of the Board. For other
information concerning the Company's executive officers who are also Directors,
including the years in which they first became executive officers, reference
should be made to "BUSINESS EXPERIENCE OF NOMINEES" above.
COMPENSATION OF CERTAIN EXECUTIVE OFFICERS
The following table sets forth certain information regarding compensation
paid or accrued by the Company to or for the account of the named executive
officers for the Company's fiscal years ended June 30, 1998, 1997 and 1996.
SUMMARY COMPENSATION TABLE
============================================================================================================
NAME AND YEAR ANNUAL COMPENSATION/1/ LONG-TERM COMPENSATION ALL
PRINCIPAL OTHER
POSITION COM-
PENSA-
TION
($)
- ------------------------------------------------------------------------------------------------------------
SALARY BONUS OTHER AWARDS PAYOUT
($) ($) ANNUAL
COM-
PENSA-
TION
($)
- ------------------------------------------------------------------------------------------------------------
RESTRICTED OPTIONS LTIP
STOCK /SARS PAY-
AWARDS(S) (#) OUTS
($) ($)
============================================================================================================
J. WILLIAM
BRANDNER, 1998 189,535 -0- 40,830/2/ -0- -0- -0- -0-
PRESIDENT AND
CHIEF 1997 175,000 -0- 29,070/2/ -0- -0- -0- -0-
EXECUTIVE
OFFICER 1996 171,686 -0- -0- -0- 132,300/3/ -0- -0-
- ------------------------------------------------------------------------------------------------------------
J. MELVIN
STEWART, 1998 183,384 -0- 28,976/2/ -0- -0- -0- -0-
CHAIRMAN OF THE
BOARD 1997 170,000 -0- 26,786/2/ -0- -0- -0- -0-
1996 167,088 -0- -0- -0- 121,275/3/ -0- -0-
- -----------------------------------------------------------------------------------------------------------
PHILIP HOWE
HOARD, 1998 100,940 -0- 8,096/2/ -0- -0- -0- -0-
VICE PRESIDENT
AND SECRETARY 1997 95,100 -0- 11,680/2/ -0- -0- -0- -0-
1996 90,200 -0- -0- -0- 66,150/3/ -0- -0-
- -----------------------------------------------------------------------------------------------------------
TODD D.
THRASHER, 1998 61,731 -0- 20,858/2/ -0- -0- -0- -0-
VICE PRESIDENT,
TREASURER &ASST. 1997 29,000 -0- -0- -0- 31,500 -0- -0-
SECRETARY
1996 -0- -0- -0- -0- -0- -0- -0-
===========================================================================================================
_____________________________
8
/1/Excludes (a) benefits generally available to all employees on a
nondiscriminatory basis and (b), except as described in Note (3) below, the
following (which did not exceed 10% of the total annual salary and bonus
earned by the named individuals for the 1998 Fiscal Year): (i) automobile
maintenance expenses paid to or on behalf of the named individual by the
Company; and (ii) the cost to the Company of personal use by the named
individuals of automobiles owned or leased by the Company.
/2/Represents: (a) with respect to Mr. Brandner, awards under the Company's
Senior Management Incentive Plan for 1998 of $20,415 cash and 6,049 shares of
Common Stock having a per share value of $3.375 as of the June 30, 1998
effective award date and for 1997 $14,535 cash and 5,678 shares of Common
Stock having a per share fair market value of $2.56 as of the June 30, 1997
effective award date; (b) with respect to Mr. Stewart, awards under the Senior
Management Incentive Plan for 1998 of $14,488 cash and 4,293 shares of Common
Stock having a per share value of $3.375 as of the June 30, 1998 effective
award date and for 1997 $13,384 cash and 5,228 shares of Common Stock having a
per share fair market value of $2.56 on the June 30, 1997 effective award
date; (c) with respect to Mr. Hoard, awards under the Senior Management
Incentive Plan for 1998 of $4,048 and 1,199 shares of Common Stock having a
per share fair market value of $3.375 on the June 30, 1998 effective award
date and for 1997 $5,840 cash and 2,141 shares of Common Stock having a per
share fair market value of $2.56 on the June 30,1997 effective award date; and
(d) with respect to Mr. Thrasher, awards under the Senior Management Incentive
Plan for 1998 of $10,429 cash and 3,090 shares of Common Stock having a per
share value of $3.375 on the June 30, 1998 effective award date.
/3/Represents: (a) with respect to Mr. Brandner, 72,296 options granted under
the Company's 1988 Stock Option Plan (the "1988 Plan") on July 17, 1995 and
60,004 options granted under the Company's Employee and Consultant Stock
Compensation Plan (the "1994 Plan") on September 1, 1995; (b) with respect to
Mr. Stewart, 121,275 options granted under the 1994 Plan on September 1, 1995;
(c) with respect to Mr. Hoard, 36,147 options granted under the 1988 Plan on
July 17, 1995 and 30,003 options granted under the 1994 Plan on September 1,
1995; and (d) 31,500 options granted to Mr. Thrasher under the 1994 Plan on
January 6, 1997. Such options are exercisable at any time within five years
following their respective grant dates at prices (adjusted for 1996 and 1997
stock dividend) equal to the per share fair market value of the Common Stock
on the respective grant dates.
In August 1995, the Company adopted the La-Man Corporation Senior
Management Incentive Plan for executive officers. See "SENIOR MANAGEMENT
INCENTIVE PLAN" below. During the 1998 Fiscal Year, the only incentive
compensation plans in effect for executive officers were the 1988 Plan; the 1992
Plan; and the 1994 Plan, all of which provide for grants of options and, in the
case of the 1994 Plan, direct awards of Common Stock, to employees and
consultants; and the Senior Management Incentive Plan. All of such plans are
described below.
AGGREGATED OPTION/SAR EXERCISES IN THE 1998 FISCAL YEAR
AND 1998 FISCAL YEAR-END OPTION/SAR VALUES
The following table sets forth certain information with respect to the
value as of the end of the 1998 Fiscal Year of options to purchase Common Stock
or stock appreciation rights ("SARs") granted in prior years to the named
executive officers. No options or SARs were granted to such officers during the
1998 Fiscal Year.
9
==================================================================================================
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
SHARES AT FY-END AT FY-END
NAME ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE
==================================================================================================
J. William Brandner,
President and -0- $0.00 240,345/0 $645,390/$0.00
Chief Executive Officer
- --------------------------------------------------------------------------------------------------
J. Melvin Stewart
Chairman of the Board -0- $0.00 201,275/0 $546,003/$0.00
- --------------------------------------------------------------------------------------------------
Philip Howe Hoard, Vice
President and Secretary -0- $0.00 132,300/0 $351,953/$0.00
- --------------------------------------------------------------------------------------------------
Todd D. Thrasher, Vice
President, Treasurer & Asst. -0- $0.00 31,500/0 $68,828/$0.00
Secretary
==================================================================================================
EMPLOYMENT AGREEMENTS
Each of the Company's employment agreements with its executive officers
contains confidentiality and noncompetition provisions effective during the term
of the agreement and for a period following termination of employment. Certain
of the employment agreements also provide for indemnification of the executive
to the maximum extent permitted by Nevada law or the Bylaws, whichever is
greater, and for the payment by the Company of any expense of the executive
incurred in enforcement proceedings with respect to his employment agreement if
he is successful.
J. WILLIAM BRANDNER. The Company is party to an employment agreement dated
April 28, 1994, as amended August 31, 1995, with Mr. J. William Brandner, under
which Mr. Brandner serves as President and Chief Executive Officer of the
Company for a three-year term that commenced April 28, 1994 and which is
extended automatically for additional one-year periods thereafter unless the
Company or Mr. Brandner provides written notice to the contrary not less than
six months prior to the expiration of the initial three-year term or any
extension thereof. Mr. Brandner is to receive an annual base salary of not less
than $150,000 per year. Mr. Brandner currently receives $209,950 base salary
per year.
Mr. Brandner's agreement also provides for the payment by the Company to
Mr. Brandner of certain amounts as severance in the event the Company elects to
terminate the Employment Agreement without cause. Should either the Board of
Directors or the Chairman of the Board deliver written notice of termination
without "cause" (as defined in the employment agreement) to Mr. Brandner, then
his employment agreement will be terminated effective not less than 60 days from
the date of such notice and after termination the Company will be required to
pay Mr. Brandner an amount equal to 200% of his base salary (defined as total
annual cash salary excluding bonuses) then in effect. Any such severance
payments, less required withholdings, are to be made in equal installments
corresponding to what would have been Mr. Brandner"s regular pay dates and
amounts. Simultaneously with the execution and delivery of Mr. Brandner's
agreement, the Board of Directors of the Company appointed Mr. Brandner to serve
as a Director, and also elected Mr. Brandner to serve as President and Chief
Executive Officer of the Company.
J. MELVIN STEWART. J.M. Stewart Corporation, an indirect wholly-owned
subsidiary of the Company, is party to an employment agreement effective August
1993 with Mr. Stewart, under which he is to serve as President of each of, and
to devote substantially all of his time to the business and affairs of, Stewart
Corporation and Stewart Industries. Mr. Stewart receives a base salary of
$197,872 per year over the balance of a five-year term that commenced in January
1994 and which is subject to automatic renewals
10
for successive two-year terms thereafter unless either party provides written
notice to the contrary not less than 30 days prior to the expiration of the
initial or any renewal term.
Mr. Stewart's employment agreement permits the Company to terminate his
status as an officer and convert him to a consultant of the Company for a three-
year period. In such status, Mr. Stewart would be required to work only 750
hours per year and would be entitled to 50 percent of his base salary. The
agreement also allows Mr. Stewart to convert to semi-retired status for a period
of three years and in such status to work part-time for the Company (1,200 hours
per year) for compensation equal to 75% of his base salary for the first two
years and 50% of his base salary for the remaining year.
PHILIP HOWE HOARD. Effective July 26, 1993, the Company entered into an
employment agreement with Philip Howe Hoard for a five-year term that ended July
26, 1998 and is renewable for two-year periods unless terminated by Mr. Hoard or
the Company. Mr. Hoard is employed at a base salary of $104,998 per year. Mr.
Hoard may be awarded additional salary increases and bonuses at the discretion
of the Board of Directors. In addition, Mr. Hoard's employment agreement
provides for death benefits equal to twelve monthly payments of base salary
under the employment agreement and disability benefits equal to the full
compensation payable under the employment agreement for the remainder of its
term.
Mr. Hoard's employment agreement permits the Company to terminate his
status as an officer and convert him to a consultant of the Company for a one-
year period. In such status, Mr. Hoard would be required to work only 750 hours
per year and would be entitled to 50% of his base salary.
Each of the employment agreements of Messrs. Brandner, Stewart and Hoard
provides that he is to participate in the Senior Management Incentive Plan,
described below. The agreements also provide that in the event of a "Change of
Control" (as defined below), their respective terms of employment will be
automatically renewed for three-year terms, they will be entitled to severance
in the event of termination of their employment other than for cause, and they
will have certain demand and piggyback registration rights with respect to
shares of Common Stock owned by them.
The employment agreements define a "Change of Control" as having occurred
when: (a) any one person, or any persons acting together which would constitute
a "group" for purposes of Section 13(d) of the Exchange Act (a "Group"),
consummates a tender offer, a plan of open-market purchases or an exchange offer
for shares of Common Stock, or consummates a proxy solicitation, which, in the
judgment of a majority of the members of the Board of Directors of the Company,
is reasonably likely to permit such person or Group to obtain control of a
sufficient number of voting securities of the Company to elect a majority of the
members of the Board of Directors of the Company; or (b) there occurs, within
any period of 12 consecutive months other than as the result of proxies
solicited by, or votes cast by, management of the Company, (i) a change in 35%
of the persons who, as of August 31, 1995, constituted the Board of Directors of
the Company other than as the result of resignations or (ii) an increase of 25%
or more in the number of members of the Board of Directors.
SENIOR MANAGEMENT INCENTIVE PLAN
In August 1995, the Board of Directors approved the La-Man Corporation
Senior Management Incentive Plan (the "Incentive Plan") for the purpose of (i)
strengthening the commonality of interests between management and shareholders,
(ii) linking effectively executive motivation and compensation with the
Company's performance, (iii) providing incentives and rewards for key
executives, (iv) offering a comprehensive and competitive total compensation
program, and (v) attracting and retaining executives of high caliber and
ability.
11
The Incentive Plan calls for the establishment annually of an incentive
pool to be distributed if four out of the following seven corporate goals are
achieved: (1) consolidated operating income must increase a minimum of 15% over
the prior fiscal year; (2) consolidated pre-tax income must increase a minimum
of 15% over the prior fiscal year; (3) consolidated net income from continuing
operations must increase a minimum of 15% over the prior fiscal year; (4)
consolidated net income must increase a minimum of 15% over the prior fiscal
year; (5) diluted earnings per share from continuing operations must increase a
minimum of 15% over the prior fiscal year; (6) diluted earnings per share must
increase a minimum of 15% over the prior fiscal year; and (7) the quoted closing
price per share of the Common Stock at fiscal year-end is 115% or more than the
quoted closing price at the end of the previous fiscal year. The criteria for
establishing the amount of the incentive pool is determined by the Compensation
Committee at the beginning of each year.
Each participant will have specific individual goals based on his direct
responsibility and his contributions to the attainment of the corporate goals.
These objectives will be established at the beginning of each fiscal period by
the Chairman of the Board and the President and will be communicated to the
participants as the basis for making awards. Awards are to be paid one-third in
cash, one-third in newly issued shares of Common Stock and one-third as an
adjustment of base salary.
The following awards were made under the Incentive Plan for the 1998 and
1997 Fiscal Years:
=================================================================================================
Participant No. of Shares of
Year Cash Amount Common Stock
=================================================================================================
J. William Brandner 1998 $20,415 6,049
1997 $14,535 5,678
- -------------------------------------------------------------------------------------------------
J. Melvin Stewart 1998 $14,488 4,293
1997 $13,384 5,228
- -------------------------------------------------------------------------------------------------
Phillip Howe Hoard 1998 $4,048 1,199
1997 $5,840 2,141
- -------------------------------------------------------------------------------------------------
Todd D. Thrasher 1998 $10,429 3,090
1997 $ 0 -0-
=================================================================================================
Shares of Common Stock included in the above awards were issued under the
Stock Compensation Plan. The number of shares issued was calculated on the
basis of the $3.375 and $2.56 per share average of the high and low trade prices
for the Common Stock on June 30,1998 and June 30, 1997, respectively. As part
of such awards, the foregoing persons also received certain increases in their
base salary effective July 1, 1998.
STOCK COMPENSATION PLAN
The 1994 Plan provides for the issuance of up to 2,425,500 shares of Common
Stock, either directly or upon exercise of options, pursuant to grants of awards
to certain employees, officers, Directors, consultants and other persons
providing bona fide consulting and other services to the Company.
Under the terms of the 1994 Plan, the Board of Directors or the
Compensation Committee, as the case may be, is responsible for administration of
the plan and the granting of awards thereunder, as well as the authority and
discretion to interpret the plan, to prescribe, amend and rescind rules and
regulations relating to the plan, and to make all other determinations necessary
or advisable in administering the plan. Awards may be granted only to Eligible
Participants (defined as any person, firm or other entity that renders bona fide
consulting or other services to the Company, including without limitation
employees of the Company and its subsidiaries, officers and non-employee
Directors of the Company and its subsidiaries, and independent consultants;
provided, however, that persons providing services to the Company or any of its
subsidiaries in connection with the offer or sale of securities in a capital-
raising transaction are prohibited from participating in the plan).
12
Shares of Common Stock issued directly as stock awards are required to be
measured by "fair market value" on the appropriate date for valuing the stock
award and calculated by the weighted average of the high and low bid prices of
the Common Stock as reported in The Wall Street Journal for the 10 trading days
(which need not be consecutive) on which share price information for the Common
Stock is reported in The Wall Street Journal immediately preceding the eighth
trading day prior to the date of the award, provided that none of the such 10
trading days is more than 45 days prior to the date of the award. "Weighted
average" means weighted by the total volume of shares traded on each of the
applicable 10 trading days. If sufficient per share price quotations are not
available from The Wall Street Journal, then fair market value shall be
reasonably determined by the Board of Directors or the Compensation Committee in
its sole discretion.
The terms of options granted as awards under the 1994 Plan, including
without limitation the exercise price and the duration for which such options
are exercisable, and such other terms and conditions as the Board or the
Compensation Committee may from time to time prescribe, are solely within the
discretion of the Board or the Compensation Committee; provided, however, that
the term of exercise of any options granted as awards under the 1994 Plan may
not be more than five years following the date of grant and the per share
exercise price may not be less than the per share par value of the Company's
Common Stock on the date of grant.
The Board of Directors or the Compensation Committee has the authority to
suspend or terminate the 1994 Plan at any time or from time to time, but no such
action shall adversely effect the rights of any person granted an award under
the plan prior to the date of such suspension or termination.
As of September 15, 1998, 1,182,359 options were outstanding under the
Stock Compensation Plan and 554,426 shares of Common Stock had been issued as
direct awards or upon exercise of options under the 1994 Plan.
The shares of Common Stock issuable under the Stock Compensation Plan are
registered under the Securities Act pursuant to: (a) the Company's Registration
Statement on Form S-8 filed with the Commission April 20, 1994 (Registration No.
33-77924) (575,000 shares); and (b) the Company's Registration Statement on Form
S-8 filed with the Securities and Exchange Commission on July 8, 1994
(Registration No. 33-81348), as amended by Post-Effective Amendment No. 1
thereto filed with the Commission on January 26, 1996 and Post-Effective
Amendment No. 2 thereto filed with the Commission on July 31, 1997 (1,735,000
shares).
1988 AND 1992 STOCK OPTION PLANS
The 1988 Plan provides for the granting of options to certain officers and
employees of the Company to purchase an aggregate of not more than 183,750
shares of Common Stock. The Plan is designed to qualify as an "incentive stock
option plan" under the Internal Revenue Code. As of September 15, 1998, all
183,750 options were outstanding under the 1988 Plan.
The 1992 Plan provides for the granting of options to officers, Directors,
employees and consultants to purchase not more than an aggregate of 633,938
shares of Common Stock. Because the 1992 Plan did not receive shareholder
approval within 12 months of adoption by the Company's Board of Directors, all
options granted under the 1992 Plan are required to be treated as non-qualified
options. As of September 15, 1998, a total of 80,325 options granted under the
1992 Plan were outstanding and 14,124 shares of Common Stock had been issued
upon exercise of options under such plan. The 1992 Plan includes a formula
provision under which options to purchase 10,000 shares of Common Stock are to
be granted in November of each year to each non-employee Director.
13
Effective October 31, 1995, the Board of Directors formed a Compensation
Committee required to be comprised of four non-employee Directors and delegated
to the Compensation Committee the authority to administer the 1988 Plan and the
1992 Plan.
Pursuant to both the 1988 Plan and the 1992 Plan (collectively, the "Stock
Option Plans"), the Board of Directors or the Compensation Committee determines,
subject to the provisions of the respective Stock Option Plan, the persons to
whom options are granted, the number of shares of Common Stock subject to
option, the period during which the options may be exercised and the terms and
provisions of each option. The Stock Option Plans place restrictions on the
grant of options to persons who are, at the time of the grant, members of any
such plan committee and on the grant of options to employee-Directors. No
option may be granted more than ten years after the effective date of the
respective plan or exercised more than ten years after the date of grant (five
years if the optionee owns more than 10% of the voting stock of the Company).
Additionally, with respect to incentive (or "qualified") options under the 1988
Plan, the option price may not be less than 100% of the fair market value of the
Common Stock on the date of the grant (110% if the optionee owns more than 10%
of the outstanding voting stock of the Company). Ordinarily under the 1988
Plan, optionees must remain continuously in the service of the Company for 18
months before the right to exercise an incentive option vests; under the 1992
Plan, the Board of Directors or plan committee determines, in each individual
case, whether to apply such requirements or any similar requirement. Subject to
certain limited exceptions, options may not be exercised unless, at the time of
exercise, the optionee is in the service of the Company. The 1992 Stock Option
Plan was amended subsequent to its adoption to provide that no options may be
granted thereunder at an exercise price less than 85% of the fair market value
per share of the Common Stock on the date of grant.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ACQUISITION OF AD ART ELECTRONIC SIGN CORPORATION
On February 18, 1998, the Company acquired Ad Art Electronic Sign
Corporation ("Ad Art"), a commercial sign manufacturer located in Stockton,
California. Mr. Lou A. Papais received 648,000 shares of Common Stock for his
40% interest in Ad Art and is entitled to receive up to an additional 432,000
shares of Common Stock upon Ad Art's attainment of certain earnings levels for
the fiscal year ending June 30, 1999. Mr. Terry J. Long received 162,000 shares
of Common Stock and cash of $600,000 for his 20% interest in Ad Art and is
entitled to receive up to an additional 108,000 shares of Common Stock upon Ad
Art's attainment of certain earnings levels for the fiscal year ending June 30,
1999. The remaining 40% shareholders of Ad Art received cash of $2,400,000 for
their interests.
Following the Ad Art acquisition, Ad Art entered into an employment
agreement with Mr. Long to serve as president and chief executive officer of Ad
Art. The agreement provides for a one-year term that commenced February 18,1998
and is extended automatically for additional one-year periods thereafter, unless
Ad Art or Mr. Long provides written notice to the contrary not less than 90 days
prior to the expiration of the initial one-year term or any extension thereof.
Mr. Long is to receive a base salary of not less than $175,000 per year plus a
maximum incentive compensation payment of $87,500 (5% of Ad Art's net income for
the year ending June 30,1999 in excess of $2,400,000 up to $4,150,000). Mr.
Long is to participate in the Company's Senior Management Incentive Plan for
years subsequent to fiscal 1999. The agreement also provides for the payment of
severance, in the event Ad Art elects to terminate the agreement without cause,
of the greater of the amount that would otherwise be payable over the term of
the agreement or two-thirds of the base salary. In the event Ad Art elects not
to renew or extend the agreement beyond the initial one-year term, a lump sum
severance payment of $116,672.50 is to be paid.
14
The Company also granted Mr. Long options under its 1994 Amended and
Restated Employee and Consultant Stock Compensation Plan, as amended (the "Stock
Compensation Plan"), to purchase up to 100,000 shares of the Company's Common
Stock at the exercise price of $4.03 per share, the fair market value per share
of Common Stock on the February 18, 1998 grant date. The options expire
February 18, 2003.
Ad Art and Mr. Papais entered into a consulting agreement on February 18,
1998 for a period of three years for an annual consulting fee of $100,000.
Under the terms of the agreement, Mr. Papais is required to devote a minimum of
three days per week to the business of Ad Art.
GARY BELL EMPLOYMENT AGREEMENT
Don Bell Industries entered into a new employment agreement with Gary D.
Bell on February 17, 1998 to replace the agreement which was to expire on April
14, 1998. The new agreement expires July 1, 2001. Under the terms of the new
agreement, Mr. Bell is to receive a base salary of $170,000 and is to
participate in the Senior Management Incentive Plan beginning with the year
ending June 30, 1998. The agreement also provides for the payment of severance,
in the event that Don Bell Industries terminates the employment agreement
without cause, of the lesser of 200% of base salary or the amount that would
otherwise have been payable over the remaining term of the agreement. In the
event that Don Bell Industries does not renew or extend the agreement at the
expiration of its term, a severance payment of $50,000 is payable to Mr. Bell.
PROPOSAL 2
ADOPTION OF AMENDED AND RESTATED ARTICLES OF INCORPORATION
The Board of Directors of the Company has unanimously approved a proposal
(the "Amendment Proposal") which would amend and restate the Company's Amended
Articles of Incorporation (the "Present Articles") to read as provided in the
proposed Restated Articles of Incorporation attached as Exhibit A to this Proxy
---------
Statement (the "Restated Articles"). The following discussion summarizes
certain aspects of the Amendment Proposal. The Restated Articles, if adopted by
the shareholders of the Company, will achieve the following:
CHANGE OF COMPANY NAME
As the result of the Company's acquisition of the J. M. Stewart companies
in 1994, Don Bell Industries in 1995 and Ad Art Electronic Sign Corporation in
1998, the Company's primary business operations have evolved into the design,
manufacture and marketing of electronic signs and other image enhancement
displays. The Company's original filtration business now comprises only a
relatively small segment of the overall operations. The Company's present
corporate name is not descriptive of its main business and is confusing to the
investment community and to business and acquisition prospects.
The Board of Directors has determined that the name of the Company should
be changed to Display Technologies, Inc. to better identify the Company's
principal business of designing and manufacturing electronic displays, message
centers and other commercial signs. The Company has been using this name as an
assumed trade name since August 1998.
The name "La-Man" does carry some positive market recognition in the
filtration industry. If the Restated Articles are approved by the shareholders,
the Company will spin off the filtration division to a new, wholly-owned Nevada
subsidiary that will be named "La-Man Corporation."
15
AUTHORIZATION OF PREFERRED STOCK
Article IV of the Restated Articles reads as follows:
"(a) The Corporation is authorized to issue two classes of stock to be
designated, respectively, as "Common Stock" and "Preferred Stock." The
total number of shares of all classes of stock that the corporation shall
have authority to issue is 100,000,000 shares, consisting of 50,000,000
shares of Common Stock, par value $.001 per share, and 50,000,000 shares of
Preferred Stock, par value $.001 per share.
(b) The shares of Common Stock may be issued from time to time for such
consideration as the Board of Directors may determine. Each holder of
shares of Common Stock shall be entitled to one vote for each share of
Common Stock held of record on all matters on which the holders of Common
Stock are entitled to vote.
(c) The shares of Preferred Stock may be issued from time to time in one
or more series and for such consideration as the Board of Directors may
determine. The Board of Directors is authorized, subject to any
limitations prescribed by law, to establish from time to time the number of
shares to be included in each such series, and by filing a certificate
pursuant to the applicable law of the State of Nevada to fix the
designation, powers, preferences, and rights of the shares of each such
series of Preferred Stock, and any qualifications, limitations or
restrictions thereof, including, but not limited to, the dividend rights,
dividend rate or rates, conversion rights, voting rights, rights and terms
of redemption (including sinking fund provisions), the redemption price or
prices, and the liquidation preferences of any wholly unissued series of
shares of Preferred Stock, or any or all of them, all to the fullest extent
now or hereafter permitted by the Nevada General Corporation Law, and to
increase or decrease the number of shares of any series subsequent to the
issuance of shares of that series, but not below the number of shares of
such series then outstanding. In case the number of shares of any series
of Preferred Stock shall be so decreased, the shares representing such
decrease shall resume the status which they had prior to the adoption of
the resolution originally fixing the number of shares of such series. No
vote of the holders of the Common Stock or the Preferred Stock shall,
unless otherwise provided in the resolutions creating any particular series
of Preferred Stock, be a prerequisite to the issuance of any shares of any
series of the Preferred Stock authorized by and complying with the
conditions of these Articles of Incorporation."
The Present Articles provide that the authorized capital stock is to
consist of 50,000,000 shares of Common Stock and no other class of capital
stock. The proposed amendment would authorize the Board of Directors to issue a
new class of capital stock consisting of 50,000,000 shares of Preferred Stock,
from time to time, in one or more series, to such persons and for such
consideration as it may determine without further action by the shareholders,
except as otherwise required by law. As indicated in the text of the amendment
set forth above, the shares of Preferred Stock would have such designations,
rights, powers, preferences and privileges and such qualifications, limitations
and restrictions, as the Board of Directors may determine. Any such Preferred
Stock may rank superior to the Common Stock or to other series of Preferred
Stock in any or all respects.
The Board of Directors believes that the proposed authorization of
Preferred Stock is desirable to enhance the Company's flexibility in connection
with future acquisitions of other businesses and other actions such as stock
dividends, financings, corporate mergers, acquisitions of property, use in
employee benefit plans and for other general corporate purposes. Having such
authorized capital stock available for issuance in the future would give the
Company greater flexibility and would allow shares of Preferred Stock to be
issued without the expense and delay of a special shareholders' meeting.
Elimination of the delay occasioned by
16
the necessity of obtaining shareholder approval will better enable the Company
to engage in financing transactions and acquisitions that take full advantage of
changing market conditions.
It is not possible to state the precise effect of the authorization of the
Preferred Stock upon the rights of holders of Common Stock until the Board of
Directors determines the respective preferences, limitations and relative rights
of the holders of one or more series of Preferred Stock. However, certain
effects could include, among other things: (i) reduction of the amount
otherwise available for payment of dividends on Common Stock, to the extent
dividends are payable on any issued shares of Preferred Stock, and restrictions
on dividends on Common Stock if dividends on Preferred Stock are in arrears;
(ii) dilution of the voting power of Common Stock to the extent that the
Preferred Stock has rights to vote with shares of Common Stock; and (iii) the
holders of Common Stock not being entitled to share in the Company's assets upon
liquidation until satisfaction of any liquidation preference granted to the
Preferred Stock.
The Restated Articles would also allow the Board of Directors to create one
or more series of Preferred Stock having cumulative voting rights, the right to
vote separately as a class on certain matters submitted to the Company's
shareholders and other special voting rights. Shareholders of Common Stock will
not have preemptive rights to purchase shares of Preferred Stock if and when any
such shares of Preferred Stock are issued. However, the corporate governance
requirements of the Nasdaq SmallCap Market, on which the Company's Common Stock
is traded, provide that rights of existing holders of Common Stock cannot be
disparately reduced or restricted through any corporate action or issuance,
through such measures as, among others, the issuance of super-voting stock.
The Present Articles contain no provisions having an anti-takeover effect.
The Restated Articles, if adopted, could under certain circumstances render more
difficult or discourage a merger, tender offer or proxy contest, or the
assumption of control by a holder of a large block of the Company's securities
and the removal of management, and could also have the effect of limiting
shareholder participation in certain transactions such as mergers or tender
offers whether or not such transactions are beneficial to the shareholders or
are favored by incumbent management. However, it also is possible that making
shares of Preferred Stock available for issuance could have the effect of
increasing the price offered to the Company's shareholders in a tender or
exchange offer. The Amendment Proposal is not part of a plan by the Board of
Directors to adopt a series of anti-takeover measures, nor does the Board of
Directors have any present intention to adopt or propose for adoption, and has
taken no action toward adopting, any additional measures that could be used to
discourage unsolicited attempts to acquire control of the Company. Further, the
Company is not presently engaged in any negotiations concerning the public or
private issuance of any shares of Preferred Stock, nor are there any present
arrangements, understandings or plans concerning the issuance of any such
shares.
VOTE REQUIRED
The affirmative vote of holders of a majority of the outstanding shares of
Common Stock will be required to approve Proposal 2. If Proposal 2 is approved
by the shareholders, the Restated Articles will become effective upon their
being filed with the Nevada Secretary of State.
A VOTE FOR THE AMENDMENT PROPOSAL WILL BE DEEMED A VOTE FOR THE CHANGE OF
THE COMPANY'S NAME FROM LA-MAN CORPORATION TO DISPLAY TECHNOLOGIES, INC. AND FOR
THE CREATION OF THE NEW CLASS OF AUTHORIZED PREFERRED STOCK.
17
BECAUSE THE AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE SHARES OF
COMMON STOCK OUTSTANDING IS REQUIRED TO APPROVE THE PROPOSAL, ABSTENTIONS AND
BROKER NON-VOTES WILL HAVE THE SAME EFFECT AS A VOTE AGAINST THE PROPOSAL.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" PROPOSAL 2
PROPOSAL 3
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected BDO Seidman, LLP ("BDO") as the
Company's independent public accounting firm for the fiscal year ending June 30,
1998. BDO has acted for the Company in such capacity since June 30, 1993. The
Board of Directors proposes that the shareholders ratify such selection at the
Annual Meeting. If the shareholders do not ratify the selection of BDO, the
selection of independent auditors will be reconsidered by the Board of
Directors.
Representatives of BDO are expected to be present at the Annual Meeting and
will be afforded the opportunity to make a statement if they desire and will be
available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" RATIFICATION OF THE APPOINTMENT
OF BDO SEIDMAN, LLP
OTHER MATTERS
The Board of Directors knows of no other matters to come before the Annual
Meeting. Should any unanticipated business properly come before the Annual
Meeting, the persons named in the enclosed form of proxy will vote in accordance
with their best judgement.
SHAREHOLDER PROPOSALS FOR
1999 ANNUAL MEETING
Shareholder proposals intended to be presented at the Company's 1999 Annual
Meeting of Shareholders must be received by the President of the Company for
possible inclusion in the Company's notice of and proxy statement for such 1999
meeting on or before June 2, 1999. Shareholder proposals must be made in
compliance with applicable legal requirements promulgated by the SEC and be
furnished to the President of the Company by certified mail, return receipt
requested.
18
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following information filed with the SEC pursuant to the Exchange Act
is incorporated by reference herein: the Company's Annual Report on Form 10-KSB
for the 1998 Fiscal Year.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14, or
15(d) of the Exchange Act after the date of this Proxy Statement and prior to
the date of the Annual Meeting shall be deemed to be incorporated herein by
reference. Any statement contained in a document incorporated or deemed to be
incorporated herein by reference shall be deemed to be modified or superseded to
the extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated herein by reference
modifies or supersedes such statement. Any statement contained herein shall be
deemed to be modified or superseded to the extent that a statement contained in
a subsequently filed document which is or is deemed to be incorporated by
reference modifies or supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Proxy Statement.
The Company undertakes to provide without charge to any person to whom this
Proxy Statement is delivered upon written or oral request, by first class mail
within one business day of receipt of such request, a copy of any or all of the
documents incorporated herein by reference (other than exhibits to the
information that is incorporated herein by reference, unless such exhibits are
specifically incorporated by reference to the information that this Proxy
Statement incorporates). Such requests should be directed to the Treasurer, La-
Man Corporation, 5029 Edgewater Drive, Orlando, Florida 32810 (telephone: 407-
521-7477).
SOLICITATION OF PROXIES
In addition to the solicitation of proxies by the use of the mails, proxies
may also be solicited by the Company and its Directors, officers and management-
level employees (who will receive no compensation therefor in addition to their
regular salaries and fees) by telephone, telegram, facsimile transmission and
other electronic communications methods or personal interview. The Company has
retained Morrow & Co. ("Morrow") to assist in the solicitation of proxies.
Pursuant to the Company's agreement with Morrow, Morrow will provide various
proxy solicitation services for the Company at an estimated cost of $3,500 plus
reasonable out-of-pocket expenses and indemnification against certain
liabilities. The Company also will reimburse banks and brokers who hold shares
in their name or custody, or in the name of nominees for others, for their out-
of-pocket expenses incurred in forwarding proxy materials to those persons for
whom they hold such shares. All costs of such solicitation will be borne by the
Company.
YOU ARE URGED TO SIGN AND RETURN YOUR PROXY PROMPTLY TO ENSURE THAT YOUR
SHARES WILL BE VOTED AT THE 1998 ANNUAL MEETING. FOR YOUR CONVENIENCE, A RETURN
ENVELOPE IS ENCLOSED.
By Order of the Board of Directors,
J. WILLIAM BRANDNER
September 15, 1998 President and Chief Executive Officer
19
LA-MAN CORPORATION PROXY
5029 Edgewater Drive, Orlando, Florida 32810
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Philip H. Hoard and Gary D. Bell, and each of
them, as proxies each with power to appoint his substitute, and hereby
authorizes them to represent and to vote, as designated hereon, all the shares
of common stock of La-Man Corporation held of record by the undersigned on
September 15, 1998 at the Annual Shareholders Meeting to be held on October 29,
1998 at 10:00a.m., or any adjournment thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL PROPOSALS
The following proposals are being submitted to the Shareholders:
(A) Election of eleven Directors of the Company:
1. Gary D. Bell 4. Thomas N. Grant 7. Terry J. Long 10. Robert M. Smither, Jr.
2. J. William Brandner 5. Philip H. Hoard 8. Lou A. Papais 11. J. Melvin Stewart
3. Edwin M. Freakley 6. Lester Jacobs 9. William A. Retz
(B) Restated Articles of Incorporation: Change of name to Display
Technologies, Inc. and Authorization of Preferred Stock.
(C) Ratification of appointment of BDO Seidman LLP as independent auditors.
VOTE AND SIGN ON THE REVERSE SIDE
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" PROPOSALS 1, 2 AND 3.
To vote your shares for all Director nominees, mark the "for" box. To withhold
voting for all nominees, mark the "withhold" box. If you do not wish your shares
voted "for" a particular nominee follow the instructions below:
VOTE ON PROPOSALS: For Withhold All --------------------------
1. Directors ___ ___ To withhold authority to
vote for any individual
nominee write number(s) of
nominee from reverse side.
2. Restated Articles
of Incorporation For Against Abstain
___ ___ ___
3. Ratification of For Against Abstain Please date this proxy
appointment of and sign exactly as your
BDO Seidman LLP ___ ___ ___ name(s) appear hereon:
as independent
auditors
X
------------------------
Date: , 1998
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PLEASE RETURN THIS PROXY AS PROMPTLY
Mailing Label AS POSSIBLE IN THE POSTPAID ENVELOPE
PROVIDED.