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SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party Other than the Registrant [_]
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 Rule 14a-11(c) or Rule 14a-12
RADYNE COMSTREAM INC.
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
Title of each series of securities to which transaction applies:
(1) Aggregate number of securities to which transaction applies:
(2) 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):
(3) Proposed maximum aggregate value of transaction:
$
(4) 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:
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RADYNE COMSTREAM INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 24, 2001
To Our Stockholders:
The 2001 annual meeting of Stockholders of Radyne ComStream Inc. (the "Company")
will be held at the offices of the Corporation at 3138 East Elwood Street,
Phoenix, Arizona, 85034, on May 24, 2001, beginning at 2:00 p.m. local time. The
annual meeting is being held for the following purposes:
1. To elect six directors, each for a term of one year; and
2. To transact such other business that may properly come
before the meeting.
Stockholders of record at the close of business on April 13, 2001 are entitled
to notice of and to vote at the meeting or any postponement or adjournment
thereof.
YOUR VOTE IS IMPORTANT. IN ORDER TO ASSURE YOUR REPRESENTATION AT THE MEETING,
YOU ARE REQUESTED TO COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AS PROMPTLY AS
POSSIBLE AND RETURN IT TO THE COMPANY VIA FACSIMILE TO (602) 437-4811 AND IN THE
ENCLOSED POSTAGE-PAID ENVELOPE.
By Order of the Board of Directors
/s/ Robert C. Fitting
------------------------------------
Robert C. Fitting
Chief Executive Officer
April 19, 2001
Phoenix, Arizona
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TABLE OF CONTENTS
PAGE
ABOUT THE MEETING
What is the purpose of the annual meeting?....................................................................1
Who is entitled to vote?......................................................................................1
Who can attend the meeting?...................................................................................1
What constitutes a quorum?....................................................................................1
How do I vote?................................................................................................2
What if I vote and then change my mind?.......................................................................2
What are the Board's recommendations?.........................................................................2
What vote is required to approve each item?...................................................................2
Can I dissent or exercise rights of appraisal? ...............................................................3
BOARD OF DIRECTORS
Election of Directors (Proposal No. 1)........................................................................3
How are directors compensated?................................................................................5
Are employees of the Company paid additional compensation
for service as a director?.................................................................................6
How often did the Board meet during fiscal 2000?..............................................................6
What committees has the Board established?....................................................................6
EXECUTIVE OFFICERS AND COMPENSATION
The Executive Officers........................................................................................6
Report of the Audit Committee.................................................................................8
Report of the Compensation Committee on Executive Compensation................................................9
Executive Compensation Summary...............................................................................11
Options/SAR Grants in Last Fiscal Year.......................................................................11
Aggregated Option/SAR Exercises In Last Fiscal Year
and Fiscal Year-End Options/SAR Values....................................................................11
Employee Compensation Plans..................................................................................13
STOCK PRICE PERFORMANCE GRAPH.............................................................................................15
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS............................................................................15
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT...............................................................15
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE...................................................................17
STOCKHOLDER PROPOSALS AND NOMINATIONS.....................................................................................17
INDEPENDENT AUDITORS......................................................................................................17
OTHER MATTERS.............................................................................................................18
ANNEX I - RADYNE COMSTREAM INC. AUDIT COMMITTEE CHARTER.................................................................I-1
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RADYNE COMSTREAM INC.
3138 EAST ELWOOD STREET
PHOENIX, ARIZONA 85034
(602) 437-9620
PROXY STATEMENT
This Proxy Statement relates to the 2001 Annual Meeting of Stockholders to be
held on May 24, 2001 at 2:00 p.m. local time, at the offices of the Company
located at 3138 East Elwood Street, Phoenix, Arizona, 85034, or at such other
time and place to which the annual meeting may be adjourned or postponed. THE
ENCLOSED PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY. The proxy
materials relating to the annual meeting are first being mailed to stockholders
entitled to vote at the meeting on or about April 19, 2001.
ABOUT THE MEETING
WHAT IS THE PURPOSE OF THE ANNUAL MEETING?
At the Company's annual meeting, stockholders will act upon the
matters outlined in the accompanying notice of meeting, including the election
of six directors. In addition, the Company's management will report on the
progress of the Company during 2000 and respond to questions from stockholders.
WHO IS ENTITLED TO VOTE?
Only stockholders of record at the close of business on the record
date, April 13, 2001, are entitled to receive notice of the annual meeting and
to vote the shares that they held on that date at the meeting, or any
postponement or adjournment of the meeting. At the close of business on April
13, 2001, there were issued and outstanding 14,895,248 shares of the Company's
common stock, which are entitled to cast 14,895,248 votes.
WHO CAN ATTEND THE MEETING?
All stockholders as of the record date, or their duly appointed
proxies, may attend the meeting.
WHAT CONSTITUTES A QUORUM?
The presence at the meeting, in person or by proxy, of the holders of
a majority of the outstanding shares on the record date will constitute a
quorum, permitting the Company to
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conduct its business at the annual meeting. Proxies received but marked as
abstentions will be included in the calculation of the number of shares
considered to be present at the meeting.
HOW DO I VOTE?
You can vote on matters to come before the meeting in two ways:
1. You can attend the meeting and cast your vote in person;
or
2. You can vote by completing, dating and signing the
enclosed proxy card and returning it to the Company. If
you do so, you will authorize the individuals named on the
proxy card, referred to as the proxyholders, to vote your
shares according to your instructions or, if you provide
no instructions, according to the recommendations of the
Board of Directors.
WHAT IF I VOTE AND THEN CHANGE MY MIND?
You may revoke your proxy at any time before it is exercised by:
- filing with the Secretary of the Company a notice of
revocation; or
- sending in another duly executed proxy bearing a later
date; or
- attending the meeting and casting your vote in person.
Your last vote will be the vote that is counted.
WHAT ARE THE BOARD'S RECOMMENDATIONS?
Unless you give other instructions on your proxy card, the persons
named on the proxy card will vote in accordance with the recommendations of the
Board of Directors. The Board's recommendations are set forth together with a
description of such item in this proxy statement. In summary, the Board
recommends a vote for election of the nominated slate of directors.
With respect to any other matter that properly comes before the
meeting, the proxyholders will vote as recommended by the Board of Directors or,
if no recommendation is given, in their own discretion.
WHAT VOTE IS REQUIRED TO APPROVE EACH ITEM?
ELECTION OF DIRECTORS. The nominees who receive the most votes will
be elected to the Board of Directors. A properly executed proxy marked "WITHHOLD
AUTHORITY" with respect to the election of one or more directors will not be
voted with respect to the director or directors indicated, although it will be
counted for purposes of determining whether there is a quorum.
OTHER ITEMS. For each other item the affirmative vote of the holders
of a majority of the shares represented in person or by proxy and entitled to
vote on the item will be required for
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approval. A properly executed proxy marked "ABSTAIN" with respect to any such
matter will not be voted, although it will be counted for purposes of
determining whether there is a quorum. Accordingly, an abstention will have the
effect of a negative vote.
EFFECT OF BROKER NON-VOTES. If you hold your shares in "street name"
through a broker or other nominee, your broker or nominee may not be permitted
to exercise voting discretion with respect to some of the matters to be acted
upon. Thus, if you do not give your broker or nominee specific instructions,
your shares may not be voted on those matters and will not be counted in
determining the number of shares necessary for approval. Shares represented by
such "broker non-votes" will, however, be counted in determining whether there
is a quorum.
CAN I DISSENT OR EXERCISE RIGHTS OF APPRAISAL?
Under Delaware law, holders of our voting stock are not entitled to
dissent from any of the proposals to be presented at the annual meeting or to
demand appraisal of their shares as a result of the approval of any of the
proposals.
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
GENERAL
A board of six (6) directors is to be elected at the annual meeting.
It is expected that a majority of the Common Stock will be voted in favor of the
six (6) nominees named below, all six (6) of whom are presently directors of the
Company. In the event that any management nominee is unable or declines to serve
as a director, an alternate nominee shall be designated by the present Board of
Directors to fill the vacancy. The Company is not aware of any nominee who will
be unable or will decline to serve as a director. The term of office for each
person elected as a director will continue until the next annual meeting or
until his or her successor has been elected and qualified.
VOTE REQUIRED
If a quorum is present and voting, the SIX (6) nominees receiving the
highest number of votes will be elected to the Board of Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ELECTION OF EACH OF THE DIRECTOR
NOMINEES.
NOMINEES
The names of the nominees, and certain information about them are set
forth below:
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NAME OF
NOMINEE AGE TITLE
- ------- --- -----
Lim Ming Seong 53 Chairman of the Board of Directors
Lee Yip Loi 57 Director
Dennis W. Elliott 59 Director
Tang Kum Chuen 45 Director
Robert C. Fitting 65 Director and Chief Executive Officer
Dr. C.J. Waylan 59 Director
LIM MING SEONG has been a Director and Chairman of the Board of the
Company since August 1996 and is chairman of its Compensation Committee. He is
Chairman of Stetsys Pte Ltd (ST). He sits on the boards of several ST related
and publicly listed companies such as ST Assembly Test Services Ltd, and
Chartered Semiconductor Manufacturing Ltd, where he is their Deputy Chairman,
and CSE Systems & Engineering Ltd., where he is its Chairman. He has been a
Group Director of Singapore Technologies Pte Ltd., the parent of ST since
February of 1995. From March 1992 until February 1995, he was Executive Director
of Singapore Technologies Ventures Pte Ltd and from February 1990 to March 1992,
he was Group President of Singapore Technologies Holdings Pte Ltd. Prior to that
time, he held various corporate and government positions, including Deputy
Secretary in the Singapore Ministry of Defense from 1979 to 1986. Mr. Lim
received his Bachelor of Science (Honors) in Mechanical Engineering from the
University of Toronto and his Diploma in Business Administration from the
University of Singapore. Mr. Lim also completed the Advanced Management Programs
at INSEAD and the Harvard Business School.
LEE YIP LOI has been a Director of the Company since August 1996 and
is chairman of the Audit Committee and a member of the Compensation Committee of
the Board. He was Regional Director (America) of Singapore Technologies Pte Ltd
from March 1994 until December 1998, and from May 1990 to January 1997, he was
President of its affiliate, Metheus Corporation. Prior to that time, he held a
number of managerial positions with such corporations as Singapore Technologies
Pte Ltd, Jurong Industries Ltd and Morgan Guaranty Trust and government
positions with the Singapore Ministries of Education, Defense, Culture and Home
Affairs. Mr. Lee is currently president and director of WhiteRock(2) Management
(USA) Inc., and a director of Stetsys Pte Ltd, Stetsys US Inc., WhiteRock
Investments III Ltd, WhiteRock(2) Management Ltd and KnowledgeWindow Inc.
Mr. Lee holds a Bachelor of Science Degree (with Honors) from the University of
Singapore and completed the Advanced Management Program at Harvard Business
School and the commercial banking management program at J.P. Morgan.
DENNIS W. ELLIOTT has been a Director of the Company since October
1998 and is a member of the Audit and Compensation Committees of the Board. He
is the President of Elliott Communications Co., a technology/marketing
consulting concern involved in advising companies on strategy and developing
operating ventures in telecommunications, data networking, digital
television/HDTV and multimedia. He has also held executive positions at Pacific
Telecom, Inc., RCA American Communications (now GE American Communications) and
RCA Global Communications. Mr. Elliott holds an M.B.A. from Harvard University,
an M.S.E.E from Stanford University, and a B.S.E.E. from the University of Iowa.
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TANG KUM CHUEN has been a Director of the Company since June 1999.
Mr. Tang has been the General Manager of Agilis Communication Technologies Pte
Ltd since January 1999. From July 1997 until December 1998, he was the Deputy
General Manager of CET Technologies Pte Ltd. From April 1990 until June 1997, he
was employed by Singapore Technologies Electronics Limited, initially as Senior
Project Engineer and promoted to Divisional Manager on July 1, 1996. From May
1987 until March 1990, he held various government positions with the Singapore
Ministry of Defense. Mr. Tang has a Master of Science degree (IE) from the
National University of Singapore and a Bachelor of Engineering degree (First
Class Honors) from Monash University.
ROBERT C. FITTING has been a Director of the Company since March 1995
and has served as the Company's Chief Executive Officer since October 1998 and
was its President from February 1995 until March 28, 2000. He became a Director
of the Company in March 1995. Mr. Fitting has a Master of Electrical Engineering
degree from New York University and a Bachelors with distinction from Penn State
University. His professional career began at Bell Laboratories in 1962 where he
spent six years developing innovative communication technologies. Mr. Fitting
then joined the Motorola Government Electronics Division where he was an
engineering manager. He published more than a dozen technical papers and was
awarded a number of patents. He left Motorola in 1978 to build a new company
under an agreement with Comtech Telecommunications. The new company was named
Comtech Data Corporation, subsequently known as Fairchild Data Corporation. Mr.
Fitting was the General Manager and President of Comtech Data Corporation from
1978 to 1984. He left Comtech to start a new company called EFData Corporation.
As co-founder, CEO and President of EFData Corporation, Mr. Fitting built the
company into a worldwide market leader in satellite communications equipment.
While at EFData, Mr. Fitting won the "Arizona Entrepreneur of the Year" award in
the manufacturing/high technology category.
DR. C. J. WAYLAN has been a director since February 15, 2000 and is a
member of the Audit and Compensation Committees of the Board. He is currently a
telecommunications and business advisor to startup ventures, mature companies
initiating new business strategies and early stage investment firms. From
September 1997 to August 2000, he was the President and Chief Executive Officer
of Constellation Communications, Inc. (CCI). From 1981 until 1996, Dr. Waylan
served in several senior executive positions for GTE Corporation. He founded
Southern Pacific Satellite Company (SPSC) which became GTE Spacenet, where he
served as its president until 1993. He led the teams which initiated several new
wireless voice and data activities as an Executive Vice President in GTE's
wireless group. Dr. Waylan served in the US Navy for twenty years in a number of
space and communications-related positions. He retired from the Navy in 1979
with the rank of Commander. He has a Bachelor of Science degree in physics from
the University of Kansas, a Master of Science degree in electrical engineering
and a Ph.D. from the Naval Postgraduate school. He currently serves on the
boards of directors of Constellation Communications and Globecomm Systems, Inc.
During the past twenty five years, Dr. Waylan has served on numerous boards for
commercial and government organizations including the International
Communications and Information Policy Advisory Committee of the U.S. Department
of State.
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HOW ARE DIRECTORS COMPENSATED?
Our policy has been to pay no cash compensation to directors who are
our employees or ST affiliates for their service as directors. Outside directors
are paid $4,000 per meeting attended and $500 if attendance is via telephone. In
April 1999, all directors became eligible to receive stock options. During
fiscal 2000, options were granted to the Directors as follows: On February 14,
2000, the Board of Directors voted to grant Dr. Waylan options to purchase
10,000 shares of our common stock at $14.00 per share. On the same date, options
to purchase 5,000 shares each were granted to Mr. Elliott, Mr. Tang and Mr. Lee
at $14.00 per share. These options expire in February 2010. Further, on
September 26, 2000, Mr.'s Elliott and Lee were each granted options to purchase
2,000 shares at $8.25 which options expire on September 26, 2010 and on October
6, 2000, Messrs. Elliott, Lee and Tang were each granted options to purchase
1,300 shares at $6.50 and Mr. Waylan was granted options to purchase 2,500
shares at $6.50, which options will expire on October 6, 2010.
ARE EMPLOYEES OF THE COMPANY PAID ADDITIONAL COMPENSATION FOR SERVICE AS A
DIRECTOR?
No. We do, however, reimburse them for travel and other related
expenses.
HOW OFTEN DID THE BOARD MEET DURING FISCAL 2000?
The Board of Directors met four times during fiscal 2000. Attendance
by directors at the meetings of the Board and Board committees on which they
served was 100%.
WHAT COMMITTEES HAS THE BOARD ESTABLISHED?
The Board of Directors has standing Executive, Compensation, and
Audit Committees. The Company does not maintain a standing nominating committee
or other committee performing similar functions. The function of nominating
directors is carried out by the entire Board of Directors. Our Bylaws, however,
provide a procedure for you to recommend candidates for directors at an annual
meeting. For more information, see page 17 under "Stockholder Proposals and
Nominations."
NAME EXECUTIVE COMMITTEE COMPENSATION COMMITTEE AUDIT COMMITTEE
---- ------------------- ---------------------- ---------------
Lim Ming Seong X X
Lee Yip Loi X X X
C.J. Waylan X X
Dennis W. Elliott X X
Robert C. Fitting X
EXECUTIVE COMMITTEE. The Executive Committee, which consisted of directors Lim,
Lee and Fitting, met two times during fiscal 2000. The Executive Committee
reviews the business plan of the Company and evaluates potential strategic
partnerships, including acquisitions.
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COMPENSATION COMMITTEE. The Compensation Committee, which consisted of directors
Lim, Lee, Elliott, and Waylan, met four times during fiscal 2000. The
Compensation Committee reviews the performance of management and will at the
appropriate times review the structure of management and plans for management
succession. The Committee also reviews and approves the Company's compensation
policies and administers the Company's 1996 Incentive Stock Option Plan and its
2000 Long Term Incentive Plan.
AUDIT COMMITTEE. The Audit Committee, which consisted of directors Lee, Elliott
and Waylan, met four times during fiscal 2000. The Audit Committee reviews and
approves the scope of the audit performed by the Company's independent auditors
as well as the Company's accounting principles and internal accounting controls.
EXECUTIVE OFFICERS AND COMPENSATION
Our management consists of the following personnel, in addition to Robert C.
Fitting, our Chief Executive Officer who is named above as a Director.
NAME AGE POSITION
- ---- --- --------
Brian Duggan 59 President and Chief Operating Officer
Steven Eymann 49 Executive Vice President
Garry Kline 52 Chief Financial Officer
THE EXECUTIVE OFFICERS
BRIAN DUGGAN was promoted to President and Chief Operating Officer on
March 28, 2000. Mr. Duggan had served as Vice President of Sales and Marketing
since December 1998. In that capacity, Mr. Duggan handled global sales and
marketing efforts for our complete equipment line, with all regional sales
offices reporting directly to him. Prior to this appointment, Mr. Duggan served
as Director of Worldwide Sales for ComStream Corporation. Before joining
ComStream in 1995, Mr. Duggan spent eight years as Director of Marketing with
Comtech Systems, Inc. He has held various positions with Plessey Electronics
Systems Ltd. (UK) in engineering and sales and marketing, and with Datotek
Corporation in Texas as Director of Marketing. Mr. Duggan is a graduate of
Hatfield College in the United Kingdom, where he majored in engineering.
STEVEN W. EYMANN has been Chief Technical Officer since October 1998
and has been our Executive Vice President since February 1995. Mr. Eymann
graduated with honors and a Bachelor of Science in Electrical Engineering from
the University of Nebraska. His professional career began in 1974 at the
Motorola Government Electronics Division, where he was a design engineer, task
leader and finally a project leader on a number of developments. In 1981, Mr.
Eymann joined Comtech Data Corporation, where he was Director of Product
Development. Mr. Eymann was responsible for budget, schedule, and technical
aspects of all new product development within Comtech. He left Comtech in 1984
to co found EFData Corporation. As Vice President of Engineering and co-founder
of EFData, Mr. Eymann was responsible for new product development and
engineering management in the design and
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manufacture of high technology military and commercial communications equipment.
He developed the Intelsat Data Subsystem including modems and redundancy
switches. These pre-eminent designs helped EFData become the leading supplier of
satellite modems in the world. In 1993, Mr. Eymann became President of EFData.
In 1995, Mr. Eymann participated in the turnaround of Radyne Corp and once again
was the major contributor in new product designs.
GARRY D. KLINE, Vice President of Finance, Chief Financial Officer
and Secretary, joined our Company in September 1995. From that time until July
1997 he was Secretary and Controller. From 1987 until September 1995, Mr. Kline
served as CFO and Controller of EFData Corporation. Prior to 1987, Mr. Kline
served in various positions, including Vice President of Finance for Megatronics
Inc., a publicly held printed circuit board manufacturer, Vice President of
Operations for Vernal Lodging Associates, a hospitality management company, and
General Partner of Tax and Accounting Computer Service, an accounting company.
REPORT OF THE AUDIT COMMITTEE
The following Report of the Audit Committee does not constitute
soliciting material and should not be deemed filed or incorporated by reference
into any other Company filing under the Securities Act of 1933 or the Securities
Exchange Act of 1934, except to the extent the Company specifically incorporates
this Report.
It is the duty of the Audit Committee to provide independent,
objective oversight of the Company's accounting functions and internal controls.
The Audit Committee is composed of independent directors, and acts under a
written charter that sets forth the audit related functions the committee is to
perform. You can find a copy of that charter attached to this proxy statement as
Annex I. The audit functions of the Audit Committee are to:
- Serve as an independent and objective party to monitor the
Company's financial reporting process and system of
internal control structure;
- Review and appraise the audit efforts of the Company's
independent auditors; and
- Provide an open avenue of communication among the
independent auditors, financial and senior management, and
the Board of Directors.
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The Audit Committee meets with management periodically to consider
the adequacy of the Company's internal controls and the objectivity of its
financial reporting. We discuss these matters with the Company's independent
auditors and with appropriate Company financial personnel. We regularly meet
privately with the independent auditors, who have unrestricted access to the
Committee. We also recommend to the Board the appointment of the independent
auditors and review periodically their performance and independence from
management. Toward that end, we have considered whether the non-audit related
services provided by our independent auditors are compatible with their
independence. In addition, the Committee reviews the Company's financing plans
and reports recommendations to the full Board for approval and to authorize
action.
Management has primary responsibility for the Company's financial
statements and the overall reporting process, including the Company's system of
internal control structure. The independent auditors audit the annual financial
statements prepared by management, express an opinion as to whether those
financial statements fairly present the financial position, results of
operations and cash flows of the Company in conformity with generally accepted
accounting principles and discuss with us any issues they believe should be
raised with us.
This year, we reviewed the Company's audited financial statements and
met with both management and KPMG, the Company's independent auditors, to
discuss those financial statements. Management has represented to us that the
financial statements were prepared in accordance with generally accepted
accounting principles. We have received from and discussed with KPMG the written
disclosure and the letter required by Independence Standards Board Standard No.
1 (Independence Discussions with Audit Committees). These items relate to that
firm's independence from the Company. We also discussed with KPMG any matters
required to be discussed by Statement on Auditing Standards No. 61
(Communication with Audit Committees), as amended by Statement on Auditing
Standards No. 89 and No. 90.
Based on these reviews and discussions, we recommended to the Board
that the Company's audited financial statements be included in the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 2000.
Lee Yip Loi, Chairman
Dennis W. Elliott
C.J. Waylan
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The following Report of the Compensation Committee does not
constitute soliciting material and should not be deemed filed or incorporated by
reference into any other Company filing under the Securities Act of 1933 or the
Securities Exchange Act of 1934, except to the extent the Company specifically
incorporates this Report.
It is the duty of the Compensation Committee to review and determine
the salaries and bonuses of executive officers of the Company, including the
Chief Executive Officer, and to establish the general compensation policies for
such individuals. We believe that the compensation programs for the executive
officers should reflect the Company's performance and
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the value created for our shareholders. In addition, the compensation programs
should support the goals and values of the Company and should reward individual
contributions to the Company's success.
General Compensation Policy and Philosophy. The Compensation
Committee's policy is to provide the Company's executive officers with
compensation that is based on their individual performance, the financial
performance of the Company and that is competitive enough to attract and retain
highly skilled individuals. Each officer's compensation is comprised of; (i) a
base salary, (ii) performance bonuses and (iii) stock-based incentives designed
to tie the overall compensation of the officers to the interests of the
shareholders.
CEO Compensation. With the successful listing of the Company's
stock on the Nasdaq National Market and the improving profitability of the
Company, Mr. Fitting's salary was revised upward to $250,000 on July 1, 2000.
Additionally, the Board approved bonuses of $625,000 and the issuance of 125,000
Incentive Stock Options with the average exercise price of $13.00 per share. Mr.
Fitting was required to pay off a previously granted loan with a portion of the
after tax proceeds of his bonuses.
Executive Officer Compensation. Steve Eymann, the Company's Sr.
Executive Vice President and Chief Technical Officer had compensation composed
principally of base salary, stock options granted in 1996, 1998 and 2000, and
bonuses as described below.
Brian Duggan, the Company's President and Chief Operating Officer
had compensation composed principally of base salary, stock options granted in
1999 and 2000, and bonuses as described below.
Garry D. Kline, the Company's Chief Financial Officer, had
compensation composed principally of base salary, stock options granted in 1996,
1998, 1999 and 2000, and bonuses as described below.
In fiscal 2000, our Board of Directors recognized the significant
achievements of our senior management in improving profitability of the Company
by awarding bonuses of $63,634 to Brian Duggan, $277,625 to Steven W. Eymann,
and $169,859 to Garry D. Kline. Mr.'s Fitting, Eymann and Kline were required to
pay off previously granted loans with a portion of the after tax proceeds of
their bonuses.
Compliance with Internal Revenue Code Section 162(m). Section 162(m)
of the Internal Revenue Code limits the deductibility of executive compensation
paid by publicly held corporations to $1 million for each executive officer
named in this proxy statement. The $1 million limitation generally does not
apply to compensation that is considered performance-based.
Non-performance-based compensation paid to the Company's executive officers for
the 2000 fiscal year did not exceed the $1 million limit per employee. The
Company believes that its compensation policy satisfies 162(m). As a result, the
Company believes that the compensation paid under this policy is not subject to
limits of deductibility. However, there can be no assurance that the Internal
Revenue Service would reach the same conclusion.
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Lim Ming Seong, Chairman
Lee Yip Loi
Dennis W. Elliott
C.J. Waylan
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee has consisted of Messrs. Lim, Lee, Elliott
and Waylan. There were no interlocking relationships between the Company and
other entities that might affect the determination of the compensation of the
executive officers of the Company.
EXECUTIVE COMPENSATION SUMMARY
The following table sets forth the total compensation paid or accrued
for our chief executive officer and our three other executive officers who were
employed by us at December 31, 2000, excluding officers paid less than $100,000
annually (collectively, the "Named Executive Officers").
LONG-TERM COMPENSATION
--------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
-------------------------------------- ------------------------ ---------
RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARD(S) OPTIONS/ PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($) ($) SARs ($) ($)(1)
- ----------------------- ---- --------- --------- -------------------------- ---------- --------- ------------
Robert C. Fitting ..... 2000 $ 218,416 $ 200,000 -- -- 125,000 -- $ 437,843
Chief Executive 1999 $ 366,588 -- -- -- -- -- $ 229,056
Officer 1998 $ 144,234 -- -- -- 30,000 -- $ 1,186
Brian Duggan .......... 2000 $ 162,308 $63,634 -- -- 120,390 -- $ 10,529
President and Chief 1999 N/A N/A N/A N/A N/A N/A N/A
Operating Officer * 1998 N/A N/A N/A N/A N/A N/A N/A
Steven W. Eymann ...... 2000 $ 145,201 $65,175 -- -- 101,690 -- $ 221,811
Executive 1999 $ 236,916 -- -- -- -- -- $ 138,588
Vice-President 1998 $ 133,543 -- -- -- 30,000 -- $ 1,174
Garry D. Kline ........ 2000 $ 121,408 63,634 -- -- 114,190 -- $ 112,663
Chief Financial 1999 $ 113,045 -- -- -- 20,000 -- $ 92,070
Officer 1998 $ 75,000 -- -- -- 30,000 -- $ 186
- ------------------
* Brian Duggan became an officer of the Company during the 2000 fiscal year.
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(1) For the year ended 2000, these amounts were for matching 401K
contributions, executive loans forgiven, stock option compensation,
cafeteria benefits, and excess group term life insurance premiums.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning grants of stock
options to the Named Executive Officers during fiscal 2000. The Company does not
maintain an option or other stock based plan that provides for the grant of
stock appreciation rights ("SARs").
INDIVIDUAL GRANTS
----------------------------------------------------------
NUMBER OF
SECURITIES PERCENT OF AVERAGE
UNDERLYING TOTAL OPTIONS/ EXERCISE
OPTIONS/ SARs GRANTED TO PRICE AVERAGE
SARs EMPLOYEES IN (PER EXPIRATION GRANT DATE
NAME GRANTED FISCAL YEAR SHARE) DATE PRESENT VALUE $(1)
- -------------------- ---------- --------------- --------- --------------- ------------------
Robert C. Fitting 125,000 7.7% $13.00 6/29/09-10/6/09 $10.98
Brian Duggan 120,390 7.4% $12.92 2/15/09-10/6/09 $10.80
Steven Eymann 101,690 6.3% $13.00 6/29/09-10/6/09 $10.97
Garry Kline 114,190 7.0% $12.94 2/15/09-10/6/09 $10.85
- --------------------
(1) Based on the Black-Scholes option pricing model, assuming that one-fourth
of the options will be exercisable on the grant date and each of the first
three anniversaries thereof, no dividend yield, expected volatility of 104%
to 122% and a risk-free interest rate of 5.76%. Potential gains are net of
the exercise price, but before taxes associated with the exercise. Amounts
represent hypothetical gains that could be achieved for the respective
options if exercised at the end of the option term. The assumed rates of
stock price appreciation are provided in accordance with the rules of the
SEC and do not represent our estimate or projection of the future price of
our common stock. Actual gains, if any, on stock option exercises will
depend upon the future market prices of our common stock.
AGGREGATE OPTION EXERCISES IN 2000 AND HOLDINGS AT YEAR END
The following table sets forth information concerning option exercises
and option holdings for fiscal 2000 with respect to the Named Executive
Officers.
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS/SARs AT IN-THE-MONEY OPTIONS/
ACQUIRED FISCAL YEAR-END SARs AT FISCAL YEAR-END(1)
ON VALUE ----------------------------------- -----------------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------- ---------- ----------- ----------------------------------- -----------------------------------
Robert C. Fitting -- -- 165,635 76,250 $ 300,669 $ 18,754
Brian Duggan 12,500 $ 318,750 66,065 91,825 $ 19,538 $ 39,075
Steven Eymann -- -- 222,375 60,300 $ 480,982 $ 18,754
Garry Kline -- -- 75,007 79,675 $ 53,900 $ 40,634
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- --------------------
(1) Options are considered "in the money" if the fair market value of the
underlying securities exceeds the exercise price of the options. These
values are based on the December 29, 2000 closing price of the Common
Stock of $5.31 per share on the Nasdaq National Market, less the per
share exercise price.
EMPLOYEE COMPENSATION PLANS
2000 LONG-TERM INCENTIVE PLAN. Our stockholders adopted the 2000 Long-Term
Incentive Plan on June 29, 2000 as a means of rewarding certain officers and
directors for their efforts in improving our competitive and financial position
and also as an incentive to retain these individuals in the future. Our
Compensation Committee administers the plan and has the authority to determine
all matters relating to the plan, including the selection of individuals to be
granted options, the number of shares subject to the options, the exercise
price, and the term of and method by which the options may be exercised. As of
December 31, 2000, options to purchase 1,317,025 shares of common stock were
outstanding at a weighted average exercise price of $11.87 per share and options
have been exercised to purchase 1,347,300 shares of common stock. The total
number of shares of common stock remaining reserved for issuance under the plan
as of December 31, 2000 was 1,182,975. Under the plan, we may not grant options
after April 30, 2010.
1996 INCENTIVE STOCK OPTION PLAN. Our stockholders adopted the 1996 Incentive
Stock Option Plan on January 8, 1997 as a means of rewarding certain officers
and directors for their efforts in improving our competitive and financial
position and also as an incentive to retain these individuals in the future. Our
Board of Directors or the Compensation Committee administers the plan. Each has
the authority to determine all matters relating to the plan, including the
selection of individuals to be granted options, the number of shares subject to
the options, the exercise price, and the term of and method by which the options
may be exercised. As of December 31, 2000, options to purchase 1,363,941 shares
of common stock were outstanding at a weighted average exercise price of $5.62
per share and options have been exercised to purchase 628,827 shares of common
stock. The total number of shares of common stock remaining reserved for
issuance under the plan as of December 31, 2000 was 89,174. Under the plan, we
may not grant options after November 12, 2006.
Options granted under both the 2000 Long-Term Incentive Plan and the
1996 Incentive Stock Option Plan may be non-qualified options or options
qualifying as incentive stock options within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended. The initial exercise option price of
each stock option granted under each plan will not be less than the fair market
value (110% of the fair market value if the grant is to any grantee owning more
than 10% of our outstanding common stock) of the common stock subject to the
option.
An option grantee must exercise any option no more than ten years after
the date of the grant, except that options granted to persons who own more than
10% of the total combined voting power of our stock or that of an affiliate must
be exercised within five years of the grant.
Any option granted on or after October 6, 1998 under the 1996 Incentive
Stock Option Plan generally becomes exercisable immediately as to 25% of the
shares covered thereby and becomes exercisable for an additional 25% in each of
the succeeding three years. No options granted under either plan are
transferable, except upon the death of the grantee.
13
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1999 EMPLOYEE STOCK PURCHASE PLAN. On June 15, 1999, our stockholders adopted
the 1999 Employee Stock Purchase Plan, as a means of rewarding and retaining
existing employees. The purchase plan allows eligible employees, including
officers and directors, to utilize payroll deductions to purchase shares of our
common stock.
The Board of Directors or a committee of two or more directors, none of
whom will be officers or employees, have full authority to administer all
aspects of the purchase plan. As of December 31, 2000, 124,228 shares have been
authorized and issued under the plan, and 875,772 shares remain authorized and
available for issuance.
Each eligible employee may elect to have from 1% to 15% of his or her
salary deducted in each pay period and deposited into a stock purchase account
in such employee's name. At the conclusion of each purchase period, the employee
may exercise the right to purchase shares of common stock or elect a cash
distribution of all amounts held in the stock purchase account. Amounts in such
accounts may be used by employees to purchase the largest number of whole shares
available at the purchase price. The purchase price for shares of common stock
will be the lesser of 85% of the fair market value of the common stock on (a)
the first day of the applicable purchase period, or (b) the last day of such
period. In the event of termination of a participant's employment of all funds
in the employee's stock purchase account will be distributed to such employee in
cash, except for termination relating to a normal or early retirement, in which
case the balance in the stock purchase account will be used to purchase shares
of common stock.
EMPLOYEE BENEFIT PLAN. We have a qualified contributory 401(k) plan that covers
all employees in our Phoenix facility who have attained the age of 18 and are
employed at the enrollment date. We provided contributions of $172,957, $85,301,
and $31,690 respectively for the years ended December 31, 2000, 1999, and 1998.
Each participant may elect to contribute up to 15% of his or her gross
compensation up to the maximum amount allowed by the Internal Revenue Service.
We match 50% of employee's contributions up to $2,000 per year.
We also have a qualified contributory 401(k) plan that covers all
full-time employees in our San Diego facility who have been employed
continuously for at least 30 days prior to the enrollment date. We provided
contributions of $137,702 for the year ended December 31, 2000, $143,487 for the
year ended December 31, 1999, and $30,450 for the period October 15, 1998
through December 31, 1998. Each participant may elect to contribute up to 15% of
his or her gross compensation up to the maximum amount allowed by the Internal
Revenue Service. We match $0.35 for every dollar up to 7% of the employee's
contribution.
We also have a qualified contributory 401(k) plan that covers all
full-time employees employed by our subsidiary, Armer Communications.
The Company intends to merge all plans under one plan with terms
similar in nature to the plan in place at the Phoenix facility. This merger is
planned to be completed by the end of April 2001.
STOCK PRICE PERFORMANCE GRAPH
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18
The following graph illustrates a comparison of the cumulative total
stockholder return (change in stock price plus reinvested dividends) of (i) the
Company's Common Stock, (ii) the CRSP Total Return Index for the Nasdaq Stock
Market (U.S. Companies) (the "Nasdaq Market") and (iii) a peer group index
selected by the Company (the "Peer Group"), from December 31, 1995 through
December 31, 2000 (the end of the Company's fiscal year). The Peer Group was
selected by the Company based upon similar Standard Industrial Codes.
The graph assumes that $100 was invested on December 31, 1995 in the
Company's Common Stock and in each of the comparison indices, and assumes that
all dividends paid were reinvested. The comparisons in the graph are required by
the Securities and Exchange Commission and are not intended to forecast or be
indicative of possible future performance of the Company's Common Stock.
Comparison of Five-Year Cumulative Total Returns Performance
Report for RADYNE COMSTREAM, INC.
[PERFORMANCE GRAPH]
LEGEND
NASDAQ Stocks
(SIC 3660 -
3669 US
Nasdaq Stock Companies)
RADYNE Market (US Communications
Date COMSTREAM, INC. Companies) Equipment
---------- --------------- ------------ --------------
12/1995 100.0 100.0 100.0
12/1996 123.1 123.0 110.9
12/1997 76.9 150.7 118.7
12/1998 83.1 212.5 109.3
12/1999 166.2 394.9 471.5
12/2000 130.8 237.7 287.9
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Sales of products in the ordinary course of business to Agilis
Communication Technologies Pte Ltd, an affiliated company under the common
control of ST, were $352,048 for the year ended December 31, 2000.
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table sets forth, as of December 31, 2000, the ownership
of our Common Stock by (i) each person who is known by us to own of record or
beneficially more than 5% of our outstanding Common Stock, (ii) each of our
directors and our Chief Executive Officer, President, Executive Vice President
and Chief Financial Officer, and (iii) all directors and executive officers of
our Company as a group. Except as otherwise indicated, the stockholders listed
in the table have sole voting and investment powers with respect to the shares
indicated subject to applicable community property law.
15
19
NUMBER OF PERCENTAGE OF
NAME & ADDRESS SHARES(1) CLASS(1)
- ------------------------------------ --------------- -------------
Stetsys US, Inc.(2) 1,180,000 7.96%
Stetsys Pte Ltd(2) 9,676,800(3) 65.28%
Robert C. Fitting(4) 304,846(5) 2.06%
Brian J. Duggan(4) 80,558(6) *
Steven W. Eymann(4) 290,475(7) 1.96%
Garry D. Kline(4) 106,302(8) *
Ming Seong Lim(2) 0 0
Yip Loi Lee(4) 18,300(9) *
C. J. Waylan(4) 14,300(11) *
Dennis W. Elliott(4) 18,300(9) *
Kum Chuen Tang(2) 18,300(10) *
All directors and executive officers 851,381 5.74%
of the Company as a group (nine
persons)
- --------------------
* Less than one percent.
(1) The numbers and percentages shown include the shares of common stock
actually owned as of December 31, 2000 and the shares of common stock that
the person or group had the right to acquire within 60 days of such date.
In calculating the percentage of ownership, all shares of common stock that
the identified person or group had the right to acquire within 60 days of
December 31, 2000 upon the exercise of options are deemed to be outstanding
for the purpose of computing the percentage of the shares of common stock
owned by such person or group, but are not deemed to be outstanding for the
purpose of computing the percentage of the shares of common stock owned by
any other person.
(2) The address for each of these stockholders is: c/o Singapore Technologies
Pte Ltd, 83 Science Park Drive, #01-01/02 The Curie, Singapore Science
Park, Singapore 118258.
(3) The shares reported as owned by Stetsys Pte Ltd include the shares reported
as beneficially owned by Stetsys US, Inc., of which Stetsys Pte Ltd is the
sole stockholder. The Minister of Finance (Incorporated) of Singapore owns
100% of the stock of Singapore Technologies Pte Ltd, which in turn owns
100% of Stetsys Pte Ltd.
(4) The address for each of these stockholders is: c/o Radyne ComStream Inc.,
3138 East Elwood Street, Phoenix, Arizona 85034.
(5) Includes 165,635 shares underlying exercisable options held by Mr. Fitting.
(6) Includes 66,065 shares underlying exercisable options held by Mr. Duggan.
(7) Includes 222,375 shares underlying exercisable options held by Mr. Eymann.
(8) Includes 75,007 shares underlying exercisable options held by Mr. Kline.
(9) Includes 18,300 shares underlying exercisable options held by each of
Messrs. Elliott and Lee.
(10) Includes 16,300 shares underlying exercisable options held by Mr. Tang.
(11) Includes 12,500 shares underlying exercisable options held by Mr. Waylan.
16
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's executive officers and directors, and persons who own
more than ten percent of a registered class of the Company's equity securities
to file reports of ownership and changes in ownership with the Securities and
Exchange Commission ("SEC"). Executive officers, directors and greater than ten
percent Stockholders are required by SEC regulation to furnish the Company with
copies of all Section 16(a) forms they file. Based solely on its review of the
copies of such forms received by it during the year ended December 31, 2000, the
Company believes that, during such year its executive officers, directors and
ten- percent stockholders complied with all such filing requirements.
STOCKHOLDER PROPOSALS AND NOMINATIONS
Stockholder proposals for the 2002 annual meeting must be received at
the principal executive offices of the Company by January 1, 2002 to be
considered for inclusion in the Company's proxy materials relating to such
meeting.
If you wish to nominate directors or bring other business before the
stockholders at the 2002 annual meeting of Stockholders:
- - You must be a stockholder of record at the time of giving notice and be
entitled to vote at the meeting of stockholders to which the notice
relates;
- - You must notify the Secretary in writing no later than January 1, 2002;
- - Your notice must contain the specific information required in our Bylaws.
A nomination or other proposal will be disregarded if it does
not comply with the above procedure and any additional requirements set forth in
our Bylaws. Please note that these requirements relate only to the matters that
you wish to bring before your fellow stockholders at an annual meeting. They are
separate from the SEC's requirements to have your proposal included in our proxy
statement.
INDEPENDENT AUDITORS
KPMG, the Company's independent auditors for the fiscal year ended
December 31, 2000, has been appointed as the Company's independent auditors for
the fiscal year ending December 31, 2001. A representative of KPMG will be
present at the meeting and will be given an opportunity to make a statement and
to respond to questions regarding KPMG's audit of the Company's financial
statements and records for the fiscal year ended December 31, 2000.
AUDIT FEES
The aggregate fees billed by KPMG for professional services rendered
for the audit of the Company's annual financial statements and the reviews of
the financial statements included in the Company's Forms 10-Q for the fiscal
year ended December 31, 2000 were $121,000.
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21
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
For the fiscal year ended December 31, 2000, KPMG was not paid a fee
for, and did not provide, directly or indirectly, any services relating to the
design or implementation of the Company's information system, local area
network, or any hardware or software system.
ALL OTHER FEES
KPMG was paid a fee for financial reviews of the Company's filings on
Forms S-2, S-3 and S-8 (and amendments thereto). Additionally, KPMG provided
assistance during the acquisition of Armer Communications Engineering Services.
Aggregate fees billed by KPMG for these matters were $55,000.
OTHER MATTERS
As of the date of this proxy statement, the Board of Directors does not
intend to present at the annual meeting any matters other than those described
herein and does not presently know of any matters that will be presented by
other parties. If any other matter is properly brought before the meeting for
action by stockholders, proxies in the enclosed form returned to the Company
will be voted in accordance with the recommendation of the Board of Directors
or, in the absence of such a recommendation, in accordance with the judgment of
the proxy holder.
RADYNE COMSTREAM INC.
/s/ Garry D. Kline
----------------------------
Garry D. Kline
Secretary
April 19, 2001
18
22
ANNEX I
RADYNE COMSTREAM INC.
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
CHARTER
1. COMMITTEE PURPOSE
The Audit Committee's primary duties and responsibilities are to:
- Serve as an independent and objective party to monitor the
Company's financial reporting process and system of internal
control structure;
- Review and appraise the audit efforts of the Company's
independent auditors; and
- Provide an open avenue of communication among the independent
auditors, financial and senior management and the Board of
Directors.
The Audit Committee will primarily fulfill these responsibilities by carrying
out the activities enumerated in Part IV of this Charter.
II. COMPOSITION
The Audit Committee shall be comprised of three or more directors as
determined by the Board, each of whom shall, except as otherwise
permitted under applicable Nasdaq rules, be independent directors, and
shall be free from any relationship that, in the opinion of the Board,
would interfere with the exercise of his or her independent judgment as
a member of the Committee. A director shall not be deemed independent
for this purpose if he or she (a) has been an officer or employee of
the Company or its affiliates for the current or any of the past 3
years, (b) has received over $60,000 of compensation from the Company
or any of its affiliates in the previous fiscal year, except
compensation for board service, tax-qualified retirement plan benefits
or non-discretionary compensation, (c) is an immediate family member of
an individual employed as an executive officer of the Company or any of
its affiliates in the current or any of the past 3 years, (d) is a
partner, controlling shareholder or executive officer of a business to
whom the Company made, or from whom it received, payments in excess of
5% of the consolidated gross revenues of either entity, or $200,000 if
higher, in any of the past 3 years, (e) is an executive of another
entity if any of the Company's executives serve on that entity's
compensation committee, or (f) as otherwise set forth in applicable
Nasdaq rules. All members of the Committee shall have a working
familiarity with basic finance and accounting practices, and at least
one member of the Committee shall have accounting or related financial
management expertise.
23
The members of the Committee shall be elected by the Board at its
annual organizational meeting, and at such other times as may be
necessary to fill vacancies, and shall serve until their successors
shall be duly elected and qualified. Unless a Chair is elected by the
full Board, the members of the Committee may designate a Chair by
majority vote of the full Committee membership.
III. MEETINGS
The Committee shall meet at least four times annually, or more
frequently as circumstances dictate, in person or via telephone
conference call. As part of its role to foster open communications, the
Committee should meet at least annually with management and the
independent auditors in separate executive sessions to discuss any
matters that the Committee or any of these groups believe should be
discussed privately. In addition, the Committee or its Chair should
meet with the independent auditors and management quarterly to review
the Company's financials, consistent with IV.3 below. The Committee may
ask members of management or others to attend meetings and provide
pertinent information.
IV. RESPONSIBILITIES AND DUTIES
To fulfill its responsibilities and duties, the Audit Committee shall:
1. Review, reassess the adequacy of and, if necessary or appropriate,
update this Charter periodically.
2. Review, and discuss with management, the company's annual financial
statements and any related reports or other financial information
submitted to the public, including any certification, report opinion or
review rendered by the independent auditors, and recommend to the Board
whether or not the financial statements should be included in the
Company's report on Form 10-K.
3. Review each report on Form 10-Q prior to its filing and each earnings
report prior to its release. The Chair of the Committee may represent
the entire Committee for purposes of this review.
4. Recommend to the Board of Directors the selection of the independent
auditors, considering independence and effectiveness, and approve the
fees and other compensation to be paid to the independent auditors.
Review the performance of the independent auditors and approve any
proposed discharge of the independent auditors when circumstances
warrant.
5. On an annual basis, ensure that it receives from the independent
auditors as required by ISB Standard No. 1, a formal written statement
of all relationships the auditors and their affiliates have with the
Company and its affiliates, to determine the auditors' independence and
objectivity.
6. Periodically consult with the independent auditors out of the presence
of management about the adequacy of internal controls and the fullness
and accuracy of the Company's financial statements.
7. In consultation with the independent auditors, review the Company's
external financial reporting processes, accounting principles as
applied in its financial reporting and approve major changes in
accounting principles and practices and changes or improvements in
financial or accounting practices.
24
8. Establish regular and separate systems of reporting to the Audit
Committee by each of management and the independent auditors regarding
any significant judgments made in management's preparation of the
financial statements and the view of each as to the appropriateness of
such judgments.
9. Following completion of the annual audit, review separately with each
of management and the independent auditors any significant audit
findings and any significant difficulties encountered during the course
of the audit, including any restrictions on the scope of work or access
to required information.
10. As required by SAS No. 61, discuss with the independent auditors (a)
methods used to account for significant unusual transactions, (b)
controversial or emerging accounting policy areas, (c) particularly
sensitive accounting estimates and judgements, (d) disagreements with
management over the application of accounting principles, the basis for
management's estimates or the disclosures in the financial statements
and (e) any significant findings and any significant difficulties
encountered during the course of the review, including any restrictions
on the scope of work or access to required information.
11. Prepare a committee report, for inclusion in the Company's annual proxy
statement that discusses the committee's composition and
responsibilities and how they were discharged, as required by
applicable SEC and Nasdaq rules.
12. Review with the Company's counsel, any legal matter that could have a
significant impact on the Company's financial statements.
13. Conduct or authorize investigations into any matters within the Audit
Committee's scope of responsibilities. The Audit Committee shall be
empowered to retain independent counsel, accountants or others to
assist it in the conduct of any such investigation.
14. Report through its Chairman to the Board of Directors following the
meetings of the Audit Committee.
15. Perform any other activities consistent with this Charter, the
Company's By-laws and governing law, as the Committee or the Board
deems necessary or appropriate.
25
RADYNE COMSTREAM INC. VOTE BY INTERNET - www.proxyvote.com
C/O PROXY SERVICES Use the Internet to transmit your voting
P.O. BOX 9142 instructions and for electronic delivery of
FARMINGDALE, NY 11735 information up until 11:59 P.M. Eastern Time
the day before the cut-off date or meeting
date. Have your proxy card in hand when you
access the web site. You will be prompted to
enter your 12-digit Control Number which is
located below to obtain your records and to
create an electronic voting instruction form.
VOTE BY PHONE - 1-800-690-6903 Use any
touch-tone telephone to transmit your voting
instructions up until 11:59 P.M. Eastern Time
the day before the cut-off date or meeting
date. Have your proxy card in hand when you
call. You will be prompted to enter your
12-digit Control Number which is located below
and then follow the simple instructions the
Vote Voice provides you.
VOTE BY MAIL -
Mark, sign, and date your proxy card and return
it in the postage-paid envelope we have
provided or return it to Radyne ComStream Inc.,
c/o ADP, 51 Mercedes Way, Edgewood, NY 11717.
RADYNE KEEP THIS PORTION FOR YOUR RECORDS
TO VOTE, MARK BLOCKS BELOW IN
BLUE OR BLACK INK AS FOLLOWS:
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DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
RADYNE COMSTREAM INC.
ELECTION OF DIRECTORS
For Withhold For All
1. 01) Lim Ming Seong All All Except
02) Lee Yip Loi
03) Dennis W. Elliott / / / / / /
04) Tang Kum Chuen
05) Robert C. Fitting To withhold authority to vote, mark
06) Dr. C.J. Waylan "For All Except" and write the nominee's
number on the line below.
----------------------------------------
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before this meeting.
IF YOU RETURN YOUR PROPERLY EXECUTED PROXY, WE WILL VOTE YOUR SHARES AS YOU
DIRECT. IF YOU DO NOT SPECIFY ON YOUR PROXY CARD HOW YOU WANT TO VOTE YOUR
SHARES, WE WILL VOTE THEM FOR PROPOSAL 1 AND IN THE DISCRETION OF THE PROXIES
ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY
ADJOURNMENTS THEREOF.
PLEASE MARK, SIGN AND DATE THE REVERSE SIDE AND
RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
The undersigned hereby revokes any proxy or proxies heretofore given to vote
such shares at said meeting or at any adjournment thereof.
Please sign EXACTLY as your name appears hereon. When signing as attorney,
executor, administrator, trustee or guardian, please give your full title as
such. If more than one trustee, all should sign. If shares are held jointly,
both owners must sign.
- -----------------------------------------------------------
| | |
----------------------------------------------------------
Signature (PLEASE SIGN WITHIN BOX) Date
- -----------------------------------------------------------
| | |
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Signature (Joint Owners) Date
26
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RADYNE COMSTREAM INC.
ANNUAL MEETING OF STOCKHOLDERS -- MAY 24, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Robert C. Fitting and Garry D. Kline, and
each of them, proxies, with full power of substitution, acting unanimously and
voting or if only one is present and voting then that one, to vote the shares of
stock of Radyne ComStream Inc., which the undersigned is entitled to vote, at
the Annual Meeting of Stockholders to be held at the offices of the Corporation
at 3138 East Elwood Street, Phoenix, Arizona, 85034, on Thursday, May 24, 2001,
at 2:00 p.m. local time, and at any adjournment or adjournments thereof, with
all the powers the undersigned would possess if present.
PLEASE VOTE, SIGN, DATE, AND RETURN THE PROXY CARD USING THE ENCLOSED ENVELOPE
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