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FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month
of
June 1996
NAM TAI ELECTRONICS, INC.
(Registrant's name in English)
Citco Building, Wickhams Cay, P.O. Box 662,
Road Town, Tortola, British Virgin Islands
(Address of principal executive offices)
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NEWS RELEASE
NAM TAI ELECTRONICS, INC. CONTACT: WENDY WISEMAN
SUITE 530 - 999 WEST HASTINGS STREET P.R. SECRETARY
VANCOUVER, B.C. CANADA V6C 2W2
TEL: (604) 669-7800 FAX: (604) 669-7816
TOLL FREE TEL & FAX: 1-800-661-8831
NAM TAI ELECTRONICS, INC. ANNOUNCES
LETTER OF INTENT TO INVEST IN ADVANCED GRAVIS
VANCOUVER, CANADA June 17, 1996 -- Nam Tai Electronics, Inc. ("Nam Tai" or the
"Company") (NASDAQ/NMS Symbol: NTAIF) announced today that Advanced Gravis
Computer Technology Ltd. ( Advanced Gravis") has accepted a letter of intent
whereby it is proposed that Nam Tai will purchase between 25% and 30% of the
shares outstanding (35% to 45% fully diluted) in Advanced Gravis by way of
private placement. The investment will be funded by Nam Tai from available funds
on hand.
The proposed investment will result in Nam Tai becoming the largest shareholder
of Advanced Gravis as well as being allowed the right to appoint three of six
members to the Board of Directors, including Chairman. The transaction is
subject to the approval of applicable regulatory authorities and the
shareholders of Advanced Gravis who will be asked to consider the investment at
their annual general meeting scheduled for July 29, 1996, as well as the
satisfaction of certain conditions including due diligence.
Advanced Gravis designs, manufactures and markets game controllers, sound cards
and accessories for the personal computer market and is a major provider of
computer games devices worldwide. It is headquartered near Vancouver, British
Columbia and has operations in Bellingham, Washington, U.S.A., Almere,
Netherlands and Antwerp, Belgium. Advanced Gravis contracts its manufacturing,
warehousing and distribution in China. It currently employs 160 people and is
anticipated to have sales revenue in the order of USD 30 to 40 million for the
fiscal year ending January 31, 1997.
Nam Tai is interested to expand its customer base and product lines as well as
develop close relationships in the North American and world-wide markets.
Advanced Gravis has grown in sales from its first year of USD 180,000 to sales
in its 10th anniversary year of USD 32 million, primarily as a result of award-
winning product design, outstanding quality, innovative sales and marketing
strategies. Advanced Gravis is a public company listed on the Toronto Stock
Exchange (Symbol AED). It also trades through the OTC Bulletin Board (Symbol:
GRVSF). There are currently approximately 20 million shares outstanding.
Nam Tai is registered in the British Virgin Islands and maintains offices in
Hong Kong and Vancouver, Canada. It designs, develops, manufactures, assembles
and sells consumer electronic products manufactured by it in the People's
Republic of China at its ISO 9001 certified operations. The Company's products
include personal organizers, spell checkers, dictionaries, LCD modules, IC card
readers and calculators. To position itself to manufacture more sophisticated
products, the Company has made advances in the use of COB, SMT, TAB, OLB, and
FPHS technologies. The Company's customers include Canon, Casio, Citizen,
Matsushita Battery, Nintendo (which orders through Sharp), Optrex, Radio Shack,
Sanyo Electric, Seiko Instruments, Sharp and Texas Instruments.
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NEWS RELEASE
NAM TAI ELECTRONICS, INC. CONTACT: WENDY WISEMAN
SUITE 530 - 999 WEST HASTINGS STREET P.R. SECRETARY
VANCOUVER, B.C. CANADA V6C 2W2
TEL: (604) 669-7800 FAX: (604) 669-7816
TOLL FREE TEL & FAX: 1-800-661-8831
NAM TAI ELECTRONICS, INC. ANNOUNCES
100% INCREASE IN ANNUAL DIVIDEND
VANCOUVER, CANADA June 20, 1996 -- Nam Tai Electronics, Inc. ("Nam Tai" or the
"Company") (NASDAQ/NMS Symbol: NTAIF) today announced its annual dividend of
$0.03 per share. The dividend is payable to all shareholders of record at the
close of business on July 15, 1996. The dividend will be paid on or before
August 8, 1996. The Company intends to adopt the policy of increasing its
dividend on a year by year basis over the next several years to a level
consistent with other established profitable corporations, following which it
will increase its dividend annually on a basis consistent with the Company's
growth in sales and net income. The dividend announced today represents a 100%
increase over the dividend of $0.015 per share paid for 1995.
Nam Tai also today announced that it expects to report a decline in sales of 10%
to 20% for the second quarter ending June 30, 1996 compared to the same period
last year. The Company expects to remain profitable for the second quarter of
1996, but sales will be lower than the prior year as a result of deferred
customer orders following weakness experienced during the 1995 Christmas sales
season.
M.K. Koo, Chairman, commented, "The decline in sales was as forecast for the
second quarter. The prospects for the Company are very good and we remain
confident that we will meet our sales and net income goals for the year ended
December 31, 1996. We are happy to reward our shareholders with an increase in
our dividend. We are also pleased to have recently announced our intent to
make a significant investment in Advanced Gravis Computer Technology Ltd. Our
financial position remains strong with working capital in excess of $28 million
and a current ratio of 3.3 times as at March 31, 1996."
Nam Tai is registered in the British Virgin Islands and maintains offices in
Hong Kong and Vancouver, Canada. It designs, develops, manufactures, assembles
and sells consumer electronic products manufactured by it in the People's
Republic of China at its ISO 9001 certified operations. The Company's products
include personal organizers, spell checkers, dictionaries, LCD modules, IC card
readers and calculators. To position itself to manufacture more sophisticated
products, the Company has made advances in the use of COB, SMT, TAB, OLB and
FPHS technologies. The Company's customers include Canon, Casio, Citizen,
Matsushita Battery, Nintendo (which orders through Sharp), Optrex, Radio Shack,
Sanyo Electric, Seiko Instruments, Sharp and Texas Instruments.
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NAM TAI ELECTRONICS, INC.
Unit 513-520 No. 1 Hung To Road
Kwun Tong, Kowloon, Hong Kong
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
June 20, 1996
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The Annual Shareholders Meeting of Nam Tai Electronics, Inc. (the
"Company") will be held at the Plaza Hotel, Fifth Avenue at Central Park South,
New York, New York, at 4:30 p.m. (New York time) for the following purposes:
1. To elect eight members of the Board of Directors to serve for the ensuing
year;
2. To ratify the selection of Price Waterhouse as the independent public
accountants of the Company for the year ending December 31, 1996;
3. To consider and act upon such other business as may properly come before
the Meeting or any adjournments thereof.
Only holders of common shares of record at the close of business on May 16,
1996 will be entitled to vote at the Meeting. Regardless of your plan to
attend/not attend the Meeting, please complete the enclosed proxy card and sign,
date and return it promptly in the enclosed postage paid envelope. Sending in
your proxy will not prevent you from voting in person at the Meeting.
By order of the Board of Directors
Ronald G. Erdman
Secretary
Dated May 16, 1996
Hong Kong
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NAM TAI ELECTRONICS, INC.
Unit 513-520 No. 1 Hung To Road
Kwun Tong, Kowloon, Hong Kong
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PROXY STATEMENT
Meeting at 4:30 p.m. on June 20, 1996
--------
Your proxy is solicited on behalf of the Board of Directors of Nam Tai
Electronics, Inc. (the "Company") for use at the Annual Meeting of Shareholders
to be held on June 20, 1996 at the Plaza Hotel, Fifth Avenue at Central Park
South, New York, New York. If a proxy in the accompanying form is duly executed
and returned, the shares represented by the proxy will be voted as directed. If
no direction is given, the shares will be voted for the election of the eight
(8) nominees for directors named herein and for the approval of Price
Waterhouse as the Company's independent accountant for the year ending December
31, 1996. A proxy given by a shareholder may be revoked at any time before it is
exercised by notifying the Secretary of the Company in writing of such
revocation, by giving another proxy bearing a later date or by voting in person
at the Meeting.
The cost of this solicitation of proxies will be borne by the Company.
Solicitations will be made by mail. The Company will reimburse banks, brokerage
firms, other custodians, nominees and fiduciaries for reasonable expenses
incurred in sending proxy materials to beneficial owners of common shares of the
Company.
The Company's annual report, including financial statements for its fiscal
year ended December 31, 1995, is being mailed to all shareholders concurrently
herewith. The annual report is not part of the proxy materials.
THE COMPANY'S ANNUAL REPORT OF FORM 20-F FOR THE YEAR ENDED DECEMBER 31,
1995, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, IS AVAILABLE WITHOUT
CHARGE UPON WRITTEN REQUEST FROM THE SECRETARY OF THE COMPANY AT SUITE 530-999
WEST HASTINGS STREET, VANCOUVER, B.C., CANADA V6C 2W2.
Holders of common shares of record at the close of business on May 16, 1996
will be entitled to vote at the Meeting and there were 8,076,477 common shares
outstanding at that date. No business shall be transacted at any Meeting of
shareholders unless a quorum of shareholders is present at the time when the
Meeting proceeds to business. A quorum shall consist of one or more shareholders
present in person or by proxy representing at least one half of the votes of the
common shares. Each common share is entitled to one vote. Management recommends
a vote FOR the election of directors named and FOR the election of Price
Waterhouse as independent accountants for the Company for the year ending
December 31, 1996.
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ELECTION OF DIRECTORS
The Company's directors are elected annually to serve until the next Annual
General Meeting of Shareholders and until their successors are qualified and
elected. The number of directors presently authorized by Nam Tai's By-laws (as
amended) shall be not less than one nor more than eight.
Unless otherwise directed by shareholders, the proxy holder will vote all
shares represented by proxies held by them for the election of the following
nominees, all of whom are now members and constitute the Company's Board of
Directors with the exception of Mr. Robert McNamara. The Company is advised that
all nominees have indicated their availability and willingness to serve if
elected. In the event that any nominee becomes unavailable or unable to serve as
a director of the Company prior to the voting, the proxy holder will vote for a
substitute nominee in the exercise of his best judgment.
INFORMATION CONCERNING NOMINEES
Information concerning the nominees based on data provided by them is set
forth below:
M.K. KOO, 52. Mr. Koo has served as Chairman of the Board and a Director of
Nam Tai and its predecessor companies since inception. He was Chief Executive
Officer of the Company until June 1995. Mr. Koo serves on the Company's Audit
Committee.
TADAO MURAKAMI, 52. Mr. Murakami has served the Company in various
executive capacities since 1984. He became Secretary and a Director of the
Company in December 1989. From June 1989 to July 1994, Mr. Murakami was
employed as the President of the Company's Hong Kong subsidiary, following which
he succeeded Mr. Koo as President of the Company. In June 1995, he became the
Company's Chief Executive Officer. Mr. Murakami assumed the position of
Vice-Chairman in January 1996.
YOSHIO INAGAWA, 61. Mr. Inagawa joined the Company as Vice President in
June 1994, at which time he also became a Director. He assumed the position of
Chief Operating Officer in January 1996 and is responsible for managing Nam
Tai's manufacturing activities in China. From 1953 to 1993, Mr. Inagawa was
employed by Sharp Corporation in various positions, his latest being Factory
Deputy General Manager of Sharp Corporation's factory located in Nara, Japan.
RONALD G. ERDMAN, 44. Mr. Erdman joined Nam Tai as Chief Financial Officer,
Secretary and Director in January 1996 based in Vancouver, Canada. He also
serves as President of Nam Tai Electronics (Canada) Ltd. Mr. Erdman was employed
by HSBC Capital Canada Inc. from January 1990, acting as Chief Executive Officer
since July 1992. From 1980 to 1989, Mr. Erdman was employed by Pemberton
Securities Inc., lastly as Vice President and Director.
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MAXWELL YEUNG, 37. Mr. Yeung joined Nam Tai as Financial Controller,
Treasurer and Director with responsibility for finance and administration in
China and Hong Kong. Mr. Yeung has worked in the banking industry since 1983,
most recently as Assistant General Manager of Banque Worms in Hong Kong.
CHARLES CHU, 39. Mr. Chu originally served as Secretary and a Director
of the Company from August 1987 to September 1989. He was reappointed a
Director in December 1992. Since July 1988, Mr. Chu has been engaged in the
private practice of law in Hong Kong. Mr. Chu serves on Nam Tai's Audit
Committee.
ROBERT MCNAMARA, 42. Mr. McNamara was a consultant to Nam Tai during
1995 and is expected to join the Board of Directors of the Company effective
May 18, 1996. He is currently Managing Director of Broadview Associates, L.P.
of Fort Lee, New Jersey. Prior to joining Broadview Associates, L.P. in 1995,
Mr. McNamara spent fifteen years in the investment banking business with Smith
Barney Inc. and Salomon Brothers Inc., most recently as head of Salomon
Brothers' Technology Group in New York. Mr. McNamara is also a Director of
Electronic Fab Technology Corp. of Greeley, Colorado.
STEPHEN SEUNG, 49. Mr. Seung was appointed a Director of Nam Tai in
1995. He is an attorney and Certified Accountant and has been engaged in
private practice of law in New York since 1981. Mr. Seung serves on Nam Tai's
Audit Committee and is its authorized agent in the United States. He is also a
Director of Deswell Industries, Inc. of Hong Kong.
There is no family relationship among any of the named directors,
executive officers or key employees. No arrangement or understanding exists
between any such director or executive officer and any other persons pursuant
to which any director or executive officer was elected as a director or
executive officer of the Company. The directors of the Company are elected at
its Annual Meeting of Shareholders and serve until their successors take office
or until their death, resignation or removal. The executive officers serve at
the pleasure of the Board of Directors of the Company.
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COMPENSATION OF DIRECTORS AND OFFICERS
The aggregate amount of compensation (including non-cash benefits) paid
by the Company and its subsidiaries during the year ended December 31, 1995 to
all directors and officers as a group (7 people) for services in all capacities
was $773,750.
The following table sets forth certain information as to each of the
Company's executive officers whose cash compensation exceeded $100,000 for the
year ended December 31, 1995.
Name of Individual Capacity Compensation (1)
- ------------------ -------- ---------------
M.K. Koo Chairman $177,325
Tadao Murakami Vice-Chairman and $276,118
Chief Executive Officer
Yoshio Inagawa Chief Operating Officer $222,798
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(1) Includes non-cash benefits
On August 13, 1990, the Company fixed compensation for loss of office
at $500,000 for Mr. Koo and $300,000 each for Mr. Murakami and another officer
who retired from the Company in 1991. The Company also fixed the age of
retirement for officers at age 65. For the years ended December 31, 1991
through December 31, 1995, the Company accrued $40,000 each year in connection
with this arrangement. In December 1995, the Company took a one-time provision
for the balance of this arrangement in the amount of $560,000.
Directors who are full-time employees of the Company receive no
additional compensation for services as a director. Effective January 1, 1993,
the Company adopted a policy to pay each director who is not an employee of the
Company or any of its subsidiaries for service as a director $1,000 per month,
$750 per meeting attended in person, $500 per meeting attended by telephone and
to reimburse all reasonable expenses incurred in connection with services as a
director.
In previous years the Company had an incentive bonus program under
which it paid key employees, which included some of the above directors and
officers, a cash bonus based on the profits of the group. In 1993, the Company
adopted a stock option program which replaced the cash incentive program. The
Company approved the issuance of options to purchase 300,000 shares at $5.35
per share; 350,000 shares at $11.00 per share (10,000 of which were
subsequently reissued with an exercise price of $11.375 per share); and 170,000
shares at $10.50 per share, expiring on September 9, 1998, July 15, 1999 and
January 11, 2001, respectively.
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CONTROL OF THE COMPANY
The following table sets forth information as of May 16, 1996 regarding
the ownership of the Company's common shares (the only class of securities
outstanding) by all persons known by the Company to be the owner of more than
five percent (5%), by all directors owning common shares and by all directors
and officers as a group:
Identity of Number of common Percent
Person or Group shares owned of class
--------------- ---------------- --------
M.K. Koo 1,039,071 12.9%
Lully Corporation(2) 2,237,290 27.7%
Tadao Murakami 95,000 1.2%
Ronald G. Erdman 4,800 0.1%
Stephen K. Seung 14,000 0.2%
Officers and Directors
as a group (7 persons) 3,390,161 42.0%
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(1) There were 8,076,477 shares outstanding on May 16, 1996.
(2) By virtue of his majority interest in, and position with, Lully
Corporation Limited, a private corporation, Mr. Koo may be deemed the
beneficial owner of these shares. If so, he would beneficially own 40.6% of
the Company's common shares at May 16, 1996.
STOCK OPTIONS
As of May 16, 1996, there were outstanding options to purchase an
aggregate of 685,550 shares of the Company. Of these options, 203,550 are
exercisable at a price of $5.35 per share until September 9, 1998; 302,000 are
exercisable at a price of $11.00 per share until July 15, 1999; 10,000 are
exercisable at a price of $11.375 per share until July 15, 1999; and 170,000 are
exercisable at a price of $10.50 per share until January 11, 2001. A total of
395,000 options are held by officers and directors of the Company. This
includes 80,000 options held by Mr. Koo, Chairman; 160,000 options held by Mr.
Murakami, Vice-Chairman and Chief Executive Officer; 65,000 options held by Mr.
Ingawa, Chief Operating Officer; 60,000 options held by Mr. Ronald G. Erdman,
Chief Financial Officer and Secretary; and 30,000 options held by Mr. Maxwell
Yeung, Financial Controller and Treasurer. The remaining options are held by
employees of the Company and the Nam Tai Welfare Fund.
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INFORMATION CONCERNING AUDIT COMMITTEE
Pending their election as directors, the Audit Committee will consist of
Mr. M.K.Koo, Mr. Stephen Seung and Mr. Charles Chu. The Audit Committee meets
from time to time to review the financial statements and matters relating to the
audit and has full access to management and the Company's auditors in this
regard. The Audit Committee recommends the engagement or discharge of the
Company's independent accountants, consults on the adequacy of the Company's
internal controls and accounting procedures and reviews and approves financial
statements and reports.
SELECTION OF INDEPENDENT ACCOUNTANTS
The Board of Directors has selected Price Waterhouse as independent
accountants of the Company for the year ending December 31, 1996 and further
directed that the Company submit the selection of independent accountants for
ratification by shareholders at the Company's Annual Meeting. Price Waterhouse
has acted for the Company as independent accountants for the past seven years.
OTHER BUSINESS
The Board of Directors knows of no other business to be acted upon at the
Meeting. However, if any other matter shall properly come before the Meeting,
the proxy holder named in the proxy accompanying this statement will have
discretionary authority to vote all proxies in accordance with his best
judgment.
By order of the Board of Directors
Ronald G. Erdman
Secretary
Dated May 16, 1996
Hong Kong
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
For and on behalf of
Nam Tai Electronics, Inc.
by
(S.d.) Koo Ming Kown
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Koo Ming Kown
Chairman
Date: July 18, 1996