DISPLAY TECHNOLOGIES, INC.
6225 OLD CONCORD ROAD
CHARLOTTE, NORTH CAROLINA 28213
(800) 929-3521
INFORMATION STATEMENT PURSUANT TO SECTION 14(f) OF THE
SECURITIES EXCHANGE ACT OF 1934
AND RULE 14f-1 THEREUNDER
NO VOTE OR OTHER ACTION OF THE COMPANY'S SHAREHOLDERS IS REQUIRED IN CONNECTION
WITH THIS INFORMATION STATEMENT.
This Information Statement (the "Statement") contains information
required under Rule 14f-1 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and is being filed by Display Technologies, Inc. (the
"Company" or "DTEK") with the Securities and Exchange Commission (the
"Commission") on April 11, 2001 and transmitted to all holders of record of the
Company's outstanding voting securities as of the close of business on February
5, 2001 (the "Record Date").
CHANGE OF CONTROL
On December 21, 2000, Raymond James Capital Partners, L.P. ("Raymond James
Capital"), Renaissance Capital Growth & Income Fund III, Inc. ("Renaissance
III"), and Renaissance U.S. Growth & Income Trust PLC ("Renaissance PLC") filed
a Schedule 13D with the Commission disclosing that they had formed a group (the
"Investor Group") within the meaning of the definition contained in the Exchange
Act for the purpose of acquiring control of the Company in a series of
transactions, described below (the "Transactions"), which were consummated on
January 18, 2001. Prior to the consummation of the Transactions, the Investor
Group was the beneficial owner of 3,222,457 shares of Common Stock of the
Company ("Common Stock"), or 28.6% of the Common Stock. Following the completion
of the Transactions, Raymond James Capital was the beneficial owner of 4,310,945
shares of Common Stock, or 33.5% of the Common Stock, Renaissance III was the
beneficial owner of 1,522,657 shares of Common Stock, or 15.5% of the Common
Stock, Renaissance PLC was the beneficial owner of 2,378,922 shares of Common
Stock, or 22.3% of the Common Stock, and the Investor Group was the beneficial
owner of 8,212,524 shares of Common Stock, or 50.6% of the Common Stock.
As indicated below, one of the conditions of the Transactions was the
resignation of all members of the Board of Directors of the Company except for
Messrs. Gary D. Bell and Thomas N. Grant and the appointment by such remaining
directors of Gary A. Downing and William A. Pecora, representatives of Raymond
James Capital, as directors effective the closing of the Transactions, and the
appointment to the Board of Robert C. Pearson, representing the Renaissance
entities, effective 10 days following the filing of this Statement with the
Commission and its delivery to the Company's shareholders. Another condition was
the resignation of J. William Brandner, President of the Company, and certain
other officers. Effective January 26, 2001, the Board of Directors elected Mr.
James C. Taylor as a director, for a term commencing on the same date as Mr.
Pearson's term, and as President of the Company. Mr. Todd D. Thrasher was also
elected Secretary.
On January 18, 2001, the Company completed a restructuring of its
credit facilities with SouthTrust Bank ("SouthTrust"). The revolving loan
facility available to the Company and certain of its subsidiaries from
SouthTrust was separated into two new loans. First, a new revolving loan
facility (the "Company Revolving Loan") was provided to the Company and all of
its subsidiaries except Ad Art Electronic Sign Corporation ("Ad Art") and
Hamilton Digital Designs, Ltd. ("Hamilton"). The balance of the Company
Revolving Loan on the day of closing was $5,000,000. Second, an $8,122,489.56
term loan (the "Ad Art Loan") was made to Ad Art and Hamilton.
Under the terms of the new loan agreements, the Company and all of its
subsidiaries except for Ad Art and Hamilton were released from liability for the
Ad Art Loan and certain other obligations related to its Ad Art subsidiary. Ad
Art and Hamilton were released from liability under the Company Revolving Loan
and certain other obligations related to the Company's other subsidiaries. A new
term loan of up to $1,000,000 was made to Ad Art for the purpose of funding its
orderly liquidation if a sale of that subsidiary is not accomplished in the near
future. The maturity dates for all loans were extended to June 30, 2001.
Raymond James Capital, a preferred shareholder of the Company, agreed
to guarantee up to $1,750,000 of the Company Revolving Loan. Another preferred
shareholder, Renaissance PLC agreed to indemnify Raymond James Capital with
respect to a portion of any liability under the guarantee.
In consideration for this guarantee, the Company (1) granted warrants
to purchase a total of 3,000,000 shares of Common Stock at a price of $.125 per
share to Raymond James Capital and Renaissance PLC, (2) issued a total of 50,000
shares of Series A-1 Convertible Preferred Stock convertible into 2,500,000
shares of Common Stock to Raymond James Capital, Renaissance PLC and Renaissance
III in exchange for their 50,000 shares of Series A Convertible Preferred Stock
which were convertible into 1,500,300 shares of Common Stock, and (3) reduced
the conversion price of two $1,750,000 convertible notes of the Company held by
Renaissance III and Renaissance PLC from $4.31 per share of Common Stock to
$2.00 per share.
-2-
Effective upon the restructuring of the credit facility, all the
directors of the Company, except for Gary D. Bell and Thomas N. Grant, resigned.
Two directors designated by Raymond James Capital, Gary A. Downing and William
A. Pecora, were appointed to the Board of Directors. A representative of
Renaissance PLC and Renaissance III, Robert C. Pearson, and Mr. James C. Taylor
will also be added to the Board. Also effective upon restructuring of the credit
facility, J. William Brandner, President of the Company, retired as an officer
of the Company and James C. Taylor was subsequently appointed President and
Chief Executive Officer of the Company.
The Company has closed the Orlando headquarters and relocated to
Charlotte, North Carolina.
No action is required by the shareholders of the Company in connection
with the matters set forth above. Under Section 14(f) of the Exchange Act and
Rule 14f-1 of the Commission, the Company must mail to its shareholders the
information contained in this Statement prior to a change in a majority of the
Company's directors pursuant to the Company's understanding and agreement with
the Investor Group, which provides for such a change otherwise than at a meeting
of the Company's security holders.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of January 18, 2001, the Company's outstanding voting securities
were as follows: (a) 8,561,750 shares of Common Stock, par value $.001 per
share, and (b) 50,000 shares of Series A-1 Convertible Preferred Stock, par
value $.001 per share ("Series A-1 Preferred Stock").
Each share of Common Stock entitles its holder to one vote. The Series
A-1 Preferred Stock is convertible into Common Stock at the present conversion
price of $2.00 per share. Holders of the Series A-1 Preferred Stock have the
right to vote with holders of the Common Stock on an "as converted" basis, i.e.,
each share of Series A-1 Preferred Stock entitles its holder to fifty votes.
As of January 18, 2001, the aggregate number of votes to which the
holders of Common Stock were entitled with respect to such stock was 8,561,750.
The aggregate number of votes to which the holders of Series A-1 Preferred Stock
were entitled with respect to such stock was 2,500,000.
A shareholder vote is not required and will not be taken with respect
to the appointment of the new directors in connection with the Transactions
described above.
-3-
SECURITY OWNERSHIP OF PRINCIPAL SHAREHOLDERS
The following information is provided with respect to every individual,
entity or group known to the Company to beneficially own more than five percent
(5%) of any class of the Company's voting securities as of January 18, 2001.
- ---------------------------- --------------------------- ----------------------------- ----------------------
(1) (2) (3) (4)
TITLE OF CLASS NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT OF CLASS 2
BENEFICIAL OWNER (1) BENEFICIAL OWNERSHIP
- ---------------------------- --------------------------- ----------------------------- ----------------------
Series A-1 Convertible Investor Group (Raymond 50,000 shares 100%
Preferred Stock James Capital Partners,
L.P., Renaissance Capital
Growth & Income Fund III,
Inc., and Renaissance
U.S. Growth & Income
Trust PLC)
880 Carillon Parkway
St. Petersburg, FL 33716
- ---------------------------- --------------------------- ----------------------------- ----------------------
Series A-1 Convertible Raymond James Capital 40,000 shares 80%
Preferred Stock Partners, L.P.
880 Carillon Parkway
St. Petersburg, FL 33716
- ---------------------------- --------------------------- ----------------------------- ----------------------
Series A-1 Convertible Renaissance Capital 5,000 shares 10%
Preferred Stock Growth & Income Fund III,
Inc.
808 North Central
Expressway
Suite 210-LB59
Dallas, TX 75206
- ---------------------------- --------------------------- ----------------------------- ----------------------
-4-
Series A-1 Convertible Renaissance U.S. Growth & 5,000 shares 10%
Preferred Stock Income Trust PLC
808 North Central
Expressway
Suite 210-LB59
Dallas, TX 75206
- ---------------------------- --------------------------- ----------------------------- ----------------------
Common Stock Investor Group (Raymond 8,212,524 shares 7 50.6%
James Capital Partners,
L.P., Renaissance Capital
Growth & Income Fund III,
Inc., and Renaissance
U.S. Growth & Income
Trust PLC)
880 Carillon Parkway
St. Petersburg, FL 33716
- ---------------------------- --------------------------- ----------------------------- ----------------------
Common Stock Raymond James Capital 4,310,945 shares 3, 7 33.5%
Partners, L.P.
880 Carillon Parkway
St. Petersburg, FL 33716
- ---------------------------- --------------------------- ----------------------------- ----------------------
Common Stock Renaissance U.S. Growth & 2,378,922 shares 4, 7 22.3%
Income Trust PLC
808 North Central
Expressway
Suite 210-LB59
Dallas, TX 75206
- ---------------------------- --------------------------- ----------------------------- ----------------------
Common Stock Renaissance Capital 1,522,657 shares 4, 7 15.5%
Growth & Income Fund III,
Inc.
808 North Central
Expressway
Suite 210-LB59
Dallas, TX 75206
- ---------------------------- --------------------------- ----------------------------- ----------------------
Common Stock Lou A. Papais 786,979 shares 9.2%
3133 N. Ad Art Rd.
Stockton, CA 95215
- ---------------------------- --------------------------- ----------------------------- ----------------------
Common Stock J. Melvin Stewart 615,388 shares 5 7.2%
2201 Cantu Court Suite 217
Sarasota, FL 34232
- ---------------------------- --------------------------- ----------------------------- ----------------------
Larry L. Johnson
Common Stock Suite L, 527,667 shares 6 6.1%
9125 Whiskey Bottom Rd.
Laurel, MD 20707
- ---------------------------- --------------------------- ----------------------------- ----------------------
-5-
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, through the
exercise of any option, warrant or conversion of a security.
2 Based upon 50,000 shares of Series A-1 Preferred Stock and 8,561,750
shares of Common Stock issued and outstanding.
3 Includes beneficial ownership as a result of right to acquire
beneficial ownership within 60 days of: (a) 2,000,000 shares of Common
Stock issuable upon conversion of 40,000 shares of Series A-1 Preferred
Stock prior to July 30, 2004 at the present conversion price of $2.00
per share; (b) 167,945 shares of Common Stock issuable upon exercise of
Common Stock purchase warrants prior to July 30, 2004 at the present
exercise price of $2.50 per share; and (c) 2,143,000 shares of Common
Stock issuable upon exercise of warrants prior to January 17, 2006 at
the present exercise price of $.125 per share.
4 With respect to each of Renaissance III and Renaissance PLC, includes
beneficial ownership as a result of right to acquire beneficial
ownership within 60 days of: (a) 250,000 shares of Common Stock
issuable upon conversion of 5,000 shares of Series A-1 Preferred Stock
prior to July 30, 2004 at the present conversion price of $2.00 per
share; (b) 20,993 shares of Common Stock issuable upon exercise of
Common Stock purchase warrants prior to July 30, 2004 at the present
exercise price of $2.50 per share; (c) 875,000 shares of Common Stock
issuable upon conversion of 8.75% convertible debentures due March 2,
2005 at the present conversion price of $2.00; and (d) 110,250 shares
of Company Stock issuable upon exercise of common stock purchase
warrants prior to March 2, 2003 at the present exercise price of $3.92
per share. With respect to Renaissance PLC only, includes beneficial
ownership as a result of right to acquire beneficial ownership within
60 days of 857,000 shares of Common Stock issuable upon exercise of
warrants prior to January 17, 2006 at the present exercise price of
$.125 per share. Renaissance III and Renaissance PLC hold 266,414 and
265,679 shares of issued and outstanding Common Stock respectively.
5 Includes: (a) 305,000 shares held in a voting trust among Mr. Stewart,
his six children and a trust for the benefit of a grandchild which has
a term of 10 years commencing May 19, 1998 and under which Mr. Stewart
serves as sole trustee and has full voting power with respect to such
shares; (b) 145,666 shares held in a trust of which Mr. Stewart is the
sole trustee and beneficiary; and (c) 30,892 shares held in a trust of
which he is the sole trustee and the sole beneficiary is his spouse,
Nancy W. Stewart.
6 Includes 99,436 shares of Common Stock issuable at the conversion price
of $4.31 per share on a convertible note of Lockwood Sign Group, Inc.
to Mr. Johnson in the principal amount of $428,572 with a maturity date
of July 30, 2006.
-6-
7 On December 21, 2000, Raymond James Capital, Renaissance III and
Renaissance PLC filed a Schedule 13D with the Commission disclosing
that Raymond James Capital, Renaissance III and Renaissance PLC had
formed a group within the meaning of the definition contained in the
Exchange Act for the purpose of acquiring control of the Company in a
series of transactions, described above, which were consummated on
January 18, 2001. Prior to the consummation of such transactions, these
investors as a group were the beneficial owners of 3,222,457 shares of
Common Stock, or 28.6% of the Common Stock. Following the completion of
such transactions, Raymond James Capital was the beneficial owner of
4,310,945 shares of Common Stock, or 33.5% of the Common Stock,
Renaissance III was the beneficial owner of 1,522,657 shares of Common
Stock, or 15.5% of the Common Stock, Renaissance PLC was the beneficial
owner of 2,378,922 shares of Common Stock, or 22.3% of the Common
Stock, and the group was the beneficial owner of 8,212,524 shares of
Common Stock, or 50.6% of the Common Stock.
-7-
SECURITY OWNERSHIP OF DIRECTORS, DIRECTOR DESIGNEES, AND EXECUTIVE OFFICERS
The following table shows the securities of the Company owned
beneficially by each director, director designee and executive officer as of
January 18, 2001. All persons shown in the table have sole voting and investment
power with regard to the shares shown, unless otherwise indicated.
- ---------------------------- -------------------------- ------------------------------ ----------------------
(1) (2) (3) (4)
TITLE OF CLASS NAME OF AMOUNT AND NATURE OF PERCENT OF CLASS 2
BENEFICIAL OWNER (1) BENEFICIAL OWNERSHIP
- --------------------------- -------------------------- ------------------------------ ----------------------
Common Stock Gary D. Bell 192,777 shares 3, 4,5 2.2%
Director
- ---------------------------- -------------------------- ------------------------------ ----------------------
Common Stock Gary A. Downing 0 0
Director
- ---------------------------- -------------------------- ------------------------------ ----------------------
Common Stock Thomas N. Grant 29,778 shares 3, 5 *
Director
- ---------------------------- -------------------------- ------------------------------ ----------------------
Common Stock Robert C. Pearson 0 0
Director Designee
- ---------------------------- -------------------------- ------------------------------ ----------------------
Common Stock William A. Pecora 0 0
Director
- ---------------------------- -------------------------- ------------------------------ ----------------------
Common Stock James C. Taylor 0 0
Director Designee
President & Chief
Executive Officer
- ---------------------------- -------------------------- ------------------------------ ----------------------
Common Stock Todd D. Thrasher 42,662 shares 3, 4,5 *
Vice President and
Treasurer
- ---------------------------- -------------------------- ------------------------------ ----------------------
Common Stock All Executive Officers 265,217 shares 4,5 3.0%
and Directors as a Group
(7 persons)
- ---------------------------- -------------------------- ------------------------------ ----------------------
*Represents less than 1% of the outstanding shares of Common Stock.
-8-
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 8,561,750 shares of Company Stock issued and outstanding.
3 Includes the following number of shares purchasable within 60 days of
the record date upon exercise of employee stock options: Gary D. Bell
179,640 shares; Thomas N. Grant 27,347 shares; and Todd D. Thrasher
34,728 shares.
4 Does not include the following shares allocated to the following
persons' accounts under the Company's 401(k) plan: Gary D. Bell 1,279
shares; and Todd D. Thrasher 1,898 shares.
5 Does not include the following shares purchasable upon exercise of
options that, by their terms, are not presently exercisable: Gary D.
Bell 25,200 shares; Thomas N. Grant 10,500 shares; and Todd D. Thrasher
15,750 shares.
INFORMATION CONCERNING DIRECTORS AND EXECUTIVE OFFICERS
(a) There are no material proceedings known to the Company to which any
director, director designee, officer or affiliate of the Company, or any owner
of record or beneficially of more than 5% of any class of voting securities of
the Company, or any affiliate of such persons is a party adverse to the Company
or any of its subsidiaries or has a material interest adverse to the Company or
any of its subsidiaries.
(b) Information regarding the principal occupations (which have continued for at
least the past five years unless otherwise noted) of the directors, director
designees (collectively, the "Directors"), and executive officers, as of January
18, 2001, as well as certain other information, is set forth below. There are no
family relationships known to the Company between the Directors and executive
officers. There are no legal proceedings known to the Company that are material
to the evaluation of the ability or integrity of any of the Directors or
executive officers.
Gary D. Bell 51, has served as a director since October 1995. He
also serves as President and Chief Executive Officer
of our subsidiary Don Bell Industries, Inc. His term
expires at the next annual meeting of the Company's
shareholders at which directors are elected.
Gary A. Downing 42, has served as a director since January 18, 2001
and was elected Chairman of the Board on January 26,
2001. His term expires at the annual meeting of the
Company's shareholders for fiscal year 2002. He is a
Managing Director of Raymond James Capital, Inc. and
-9-
President of RJC Partners, Inc., the General Partner
of Raymond James Capital Partners, L.P. Prior to
founding Raymond James Capital, Inc. in 1997, Mr.
Downing spent 13 years in the Investment Banking
Department of Raymond James & Associates, Inc. From
1992 to 1997, Mr. Downing served as Managing Director
and Head of the Consumer Group within the Investment
Banking Department of Raymond James & Associates,
Inc.
Thomas N. Grant 54, has served as a director since October 1995.
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. His
term expires at the annual meeting of the Company's
shareholders for fiscal year 2001.
Robert C. Pearson 65, will commence serving as a director of the
Company on or about April 20, 2001 and his term will
expire at the annual meeting of the Company's
shareholders for fiscal year 2001. He also serves as
Senior Vice President and Director of Corporate
Finance for Renaissance Capital Group, an affiliate
of Renaissance Capital III and Renaissance PLC. Mr.
Pearson is also a member of the boards of the
following public companies: Poor Brothers, Inc.,
Camino Soft, Inc. and Advance Power Technology, Inc.
William A. Pecora 56, has served as a director since January 18, 2001.
His term expires at the annual meeting of the
Company's shareholders for fiscal year 2002. He is
also Senior Vice President and Chief Financial
Officer of Raymond James Capital. Prior to joining
Raymond James Capital in 2000, Mr. Pecora spent 16
years as Vice President and Chief Financial Officer
of small to middle market companies. From 1998 to
2000, Mr. Pecora was Vice President and Chief
Financial Officer of Vivra Asthma and Allergy, Inc.,
a physician practice management company. During the
period from 1992 to 1998 he served as the Vice
President and Chief Financial Officer of Noven
Pharmaceuticals, Inc., a publicly traded
pharmaceutical manufacturer. Previously Mr. Pecora
-10-
served as the Vice President and Chief Financial
Officer of Elexis Corporation, a publicly traded
manufacturer of consumer products and of
International Jensen Inc., a consumer products
manufacturer.
James C. Taylor 59, was elected President and Chief Executive Officer
of the Company on January 26, 2001. His term as a
director of the Company will commence on or about
April 20, 2001 and will expire at the next meeting of
the Company's shareholders at which directors are
elected. He has been a principal of The Anderson
Group, Inc., a private investment firm engaged in the
acquisition and management of businesses in a variety
of industries. He also currently serves on the board
of Ennis Business Forms, an NYSE listed company.
Todd D. Thrasher 33, served as Vice President and Treasurer of the
Company starting in January 1997. Mr. Thrasher also
was elected Secretary and Chief Accounting Officer of
the Company on January 26, 2001. Upon the employment
by the Company of Bill Lunford on February 5, 2001,
Mr. Lunford assumed the offices of Secretary and
Treasuerer formerly held by Mr. Thrasher.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
Each transaction involving over $60,000 (other than the Transactions,
described above under "Change in Control") which have occurred since the
beginning of the Company's last fiscal year (July 1, 1999) or which are
currently proposed and with respect to which a director (or nominee for
director), executive officer, security holder owning of record or beneficially
more than 5% of any class of the Company's securities or any member of the
immediate families of the foregoing persons had or will have a direct or
indirect material interest is described below.
ACQUISITION OF LOCKWOOD SIGN GROUP, INC.
Effective July 1, 1999, the Company acquired Lockwood Sign Group, Inc.,
a commercial sign manufacturer with facilities located in Marietta, Georgia,
Charlotte, North Carolina and the Washington D.C. area. Larry L. Johnson
received $1,387,000 cash and 428,231 shares of Company Stock for his 73%
interest in Lockwood.
Following the Lockwood acquisition, the Company and Lockwood entered
into an employment agreement with Mr. Johnson to serve as President and Chief
Executive Officer of Lockwood. This agreement was superseded by the employment
agreement between the Company and Mr. Johnson which terminated upon his
resignation as a director, officer and employee in August 2000.
The Company also granted Mr. Johnson options to purchase up to 105,000
shares of Common Stock at the exercise price of $3.54, the fair market value per
share of Common Stock on the August 27, 1999 grant date. The agreement under
which the options were granted provides that certain conditions must be
satisfied before the options become exercisable.
-11-
LOCKWOOD CONVERTIBLE NOTE
On July 30, 1999, in consideration of a loan from Mr. Johnson to
Lockwood Sign Group, Inc., Lockwood issued to Mr. Johnson a promissory note in
the principal amount of $500,000. Principal on the note is payable in six equal
annual installments of $71,428 and a seventh installment of $71,432. Present
outstanding principal on the note is $428,572. The note is also convertible into
shares of Common Stock at the present conversion price of $4.31 per share.
PREFERRED STOCK OFFERING
On July 30, 1999, the Company completed a private sale of 50,000 shares
of its authorized preferred stock designated as Series A Convertible Preferred
Stock (the "Series A Preferred") for gross proceeds of $5,000,000. The Series A
Preferred was convertible into shares of Common Stock at the conversion price of
$3.333 per share, subject to certain anti-dilution and other adjustments. 40,000
shares of Series A Preferred were purchased by Raymond James Capital Partners
L.P., and the remaining 10,000 shares were purchased 5,000 each by Renaissance
Capital Growth & Income Fund III, Inc. and Renaissance U.S. Growth & Income
Trust PLC. The Company also issued Raymond James Capital and the two Renaissance
entities warrants (the "1999 Warrants") to purchase 126,000 shares, 15,750
shares and 15,750 shares, respectively (adjusted for a 5% stock dividend in
December 1999), of Common Stock at any time prior to July 30, 2004 at the
exercise price of $3.333 per share. The exercise price is subject to certain
anti-dilution and other adjustments. The Series A Preferred was entitled to
dividends at the rate of 5.25% per year on the last day of March, June,
September and December in each year and was required to be redeemed by the
Company on July 30, 2004. The Series A Preferred was entitled to a preference
over Common Stock at liquidation at the liquidation price of $100 per share plus
any accrued but unpaid dividends. Part of the proceeds from the sale of the
Series A Preferred was used by the Company to finance part of the purchase price
for Lockwood Sign Group, Inc.
Holders of the Series A Preferred were entitled to vote with holders of
Common Stock as a single class on all matters on which holders of Common Stock
are entitled to vote. Each share of Series A Preferred stock was entitled to the
number of votes equal to the number of shares of Common Stock into which it was
convertible.
In the Transactions described above under "Change of Control", each
share of Series A Preferred issued and outstanding was exchanged by the Company
for one share of Series A-1 Convertible Preferred Stock convertible into 50
shares of Common Stock. The Series A-1 Convertible Preferred Stock entitles its
holders to the same dividends and liquidation preference as the Series A
-12-
Preferred. Also as a result of the Transactions, the exercise price of the 1999
Warrants adjusted to $2.50, and the number of shares of Common Stock subject to
the 1999 Warrants held by Raymond James Capital and the two Renaissance entities
increased to 167,945 shares, 20,993 shares and 20,993 shares, respectively.
AMERIVISION
Pursuant to an agreement dated June 28, 1999, the Company purchased
8,000 newly issued shares of convertible preferred stock from AmeriVision
Outdoor, Inc. for $500,000. The preferred stock pays quarterly cumulative
dividends at the rate of 9% per year. Upon the satisfaction of certain
conditions, the preferred stock is convertible into common stock of AmeriVision
at the price of $62.50 per share, which upon issuance would be equal to 80% of
the outstanding common stock of AmeriVision. The Company also holds warrants,
exercisable between July 1, 2001 and July 31, 2001, to purchase 8,000 shares of
AmeriVision common stock from AmeriVision at the price of $.001 per share. The
Company also has the option, upon certain conditions, to purchase the remaining
20% of the common stock of AmeriVision.
Part of the proceeds of the preferred stock was used by AmeriVision to
purchase the assets of AmeriVision Outdoor, LLC, a Nevada limited liability
company. The Nevada company used $106,000 of such proceeds to partially repay
loans of $182,000 from Terry L. Long, a director and executive officer of the
Company at such time.
The agreement between the Company and AmeriVision also provides that in
consideration of payment of a management fee, the Company has the right to
designate a representative to manage the day-to-day business operations of
AmeriVision and to serve on its board of directors. The Company has designated
Mr. Gary D. Bell to serve as such representative.
OHIO PARTNERSHIP
In June 1999, Ad Art Electronic Sign Corporation entered into a
lease-purchase transaction with an Ohio partnership (the "Ohio Partnership"),
pursuant to which the Ohio Partnership leases from Ad Art an LED outdoor display
board over a 60-month term for total lease payments of approximately $1 million.
Mr. Terry J. Long, a former director and executive officer of the Company, is a
50% non-managing partner of the Ohio Partnership. The Ohio Partnership intended
to move the LED display to various entertainment venues throughout the United
States and either secure weekly rentals of the display, or sell advertising on
the display. After several months of operation, it was unable to secure
sufficient revenue to make its lease payments to us. The Ohio Partnership, with
our assistance, was able to sell a portion of the display and make a substantial
payment to us against the original $1,000,000 receivable. We continued to assist
-13-
the Ohio Partnership in its efforts to sell the remaining portion of the display
so that it would be in a position to pay the remaining balance due us. However,
to date, the Ohio Partnership has been unable to secure a buyer for the
remaining portion of the display and, accordingly, collection of our receivable
is in doubt. During 2000, we recorded a charge of $463,000 to essentially reduce
the carrying value of our receivable to the net realizable value.
ISSUANCE OF ADDITIONAL COMPANY STOCK FOR AD ART
On February 18, 1998, the Company acquired Ad Art Electronic Sign
Corporation, a commercial sign manufacturer located in Stockton, California. In
September 1999, Mr. Lou A. Papais received an additional 453,600 shares of
Common Stock and Mr. Terry J. Long received an additional 113,400 shares of
Common Stock, as the result of Ad Art's attainment of certain earnings levels
for the 1999 fiscal year. Mr. Papais and Mr. Long are former Directors.
INDEBTEDNESS OF MANAGEMENT
Except as set forth above in connection with the Ohio Partnership,
there has been no indebtedness owed to the Company or any subsidiary of the
Company in excess of $60,000 since the beginning of the Company's last fiscal
year (July 1, 1999) by a director, nominee for election as director, executive
officer, any member of the immediate families of the foregoing persons, any
corporation or organization (other than the Company or a majority-owned
subsidiary of the Company) of which any of the foregoing persons serves as an
executive officer, partner, beneficial owner of 10% or more of any class of
equity securities, or any trust in which any of the foregoing persons has a
substantial beneficial interest or serves as trustee or in a similar capacity.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act and regulations thereunder require
our executive officers and directors and persons who beneficially own more than
10% of any class of equity securities of the Company to file with the SEC
initial reports of ownership and reports of changes in ownership of Company
stock. They are also required to furnish the Company with copies of all such
forms they file. During fiscal 2000, Mr. Gary D. Bell inadvertently filed one
late Form 4 report, and Messrs. Lou A. Papais and J. Melvin Stewart each
inadvertently filed two late Form 4 reports. In making this disclosure, we have
relied solely on our review of copies of Section 16(a) reports furnished to us
during and with respect to the most recent fiscal year and on the written
representations of our directors and executive officers.
-14-
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Company's Board of Directors has established three standing
committees, an Executive Committee, an Audit Committee, and a Compensation
Committee.
The Executive Committee, between meetings of the Board of Directors,
may exercise the powers of the Board of Directors, except with respect to a
limited number of matters, such as amending the articles of incorporation or the
bylaws of the Company and recommending to the shareholders of the Company a
merger of the Company, the sale of all or substantially all of the assets of the
Company, or the dissolution of the Company. The Executive Committee met six
times and took action by written consent on one occasion in fiscal 2000.
The Audit Committee provides independent, objective oversight of the
Company's accounting functions and internal controls, and ensures the
objectivity of our financial statements. The Audit Committee met twice in fiscal
2000. The Audit Committee reviews and discusses the Company's audited financial
statements with management. The Audit Committee has discussed with the
independent auditors the matter required to be discussed by SAS 61 (Codification
of Statements on Auditing Standards, AU Section 380). The Audit Committee has
received the written disclosures and the letter from the independent accountants
required by Independents Standards Board Standard No. 1 and has discussed with
the independent accountant the independent accountant's independence. Based on
the review and discussions referred to above, the Audit Committee recommended to
the Board of Directors that the audited financial statements be included in the
Company's annual report on Form 10-K for the last fiscal year for filing with
the Commission. The Board of Directors has adopted a written charter for the
Audit Committee.
The Compensation Committee reviews and approves all salary
arrangements, including annual and long-term incentive awards and other
remuneration, for officers of the Company and certain officers of subsidiaries.
It also is responsible for administration of the Company's stock option and
other compensation plans. The Compensation Committee met two times and took
action by written consent once in fiscal 2000.
In fiscal 2000, the Board of Directors held six meetings and took
action by written consent on one occasion. Each director attended at least 75%
of the total of all meetings of the Board and each committee on which he served,
except Mr. Lester Jacobs, who attended 62.5% of such meetings.
Following the consummation of the Transactions described above under
"Change of Control," the members of the Executive Committee, Audit Committee,
and Compensation Committee were replaced at a special meeting of the Board of
Directors, held January 26, 2001. The new members of the Executive Committee are
Gary A. Downing and William A. Pecora. Robert C. Pearson and James C. Taylor
have been elected to the Executive Committee effective upon their taking office
as directors. The current members of the Audit Committee are Gary A. Downing,
William A. Pecora and Thomas N. Grant. Each of the current members of the Audit
Committee is an "independent director" as defined in NASD Rule 4200(a)(14). The
current members of the Compensation Committee are Gary A. Downing and William A.
Pecora. Robert C. Pearson has been elected to the Compensation Committee
effective upon his taking office as director.
COMPENSATION OF DIRECTORS
The Company pays outside directors (directors who are not officers,
employees or consultants), the following fees for attending or participating in
meetings of the Board of Directors and its committees:
Event Fee
----- ---
Attended Board Meeting $1,250
Telephonic Board Meeting $500
Attended Committee Meeting $500 ($600 for Chairman)
Telephonic Committee Meeting $250 ($300 For Chairman)
During fiscal 2000, we paid our outside directors a total of $29,950 in
fees. Each director is entitled to be reimbursed for reasonable expenses of
attending a meeting of the Board or a Board committee. Our compensation policy
for outside directors also includes annual option grants. On November 18, 1999,
each of our then outside directors was granted options under our 1999 stock
incentive plan to purchase up to 10,500 shares of Company Stock at the exercise
price of $4.10 per share, the fair market value of our stock on the grant date.
The options vest one-third on each anniversary of the grant date, expire on
November 18, 2008 and are subject to certain other conditions on exercisability
as provided in the agreements evidencing the option grants.
EXECUTIVE COMPENSATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
-16-
The following table provides certain summary information concerning
compensation paid by the Company to or on behalf of certain of our executive
officers during the fiscal year ending June 30, 2000 and the two preceding
fiscal years. The officer group, referred to as the named executive officers, is
composed of J. William Brandner, the President and Chief Executive Officer
during such period, and the four other most highly compensated executive
officers, determined as of June 30, 2000:
SUMMARY COMPENSATION TABLE
Annual Compensation(1) Long-Term Compensation
------------------------------------- --------------------------------------
Other Awards Payout Other All
Annual RESTRICTED Options LTIP Com-
NAME AND Compen- STOCK /SARs Pay- pensa-
PRINCIPAL SALARY Bonus(2) sation AWARDS(S) (#) outs tion
POSITION YEAR ($) ($) ($) ($) ($) ($) (3)
--------- ---- ------ -------- ------ --------- --- ---- ----
J. William 2000 233,120 -0- -0- -0- 78,750 -0- 6,994
Brandner,
President and Chief 1999 209,950 46,360 -0- -0- -0- -0- 6,994
Executive Officer
1998 189,535 40,830 -0- -0- -0- -0- 6,298
- -------------------------------------------------------------------------------------------------------------------------
Marshall S. Harris, 2000 190,000 -0- -0- -0- 15,750 -0- 5,700
Vice President,
General Counsel & 1999 141,346 -0- -0- -0- 78,750 -0- 1,750
Secretary
1998 -0- -0- -0- -0- -0- -0- -0-
- -------------------------------------------------------------------------------------------------------------------------
Terry J. Long, 2000 205,000 -0- -0- -0- 47,250 -0- 3,469
President of Ad Art
Electronic Sign 1999 175,000 -0- -0- -0- -0- -0- 5,205
Corporation
1998 63,288 -0- -0- -0- 105,000 -0- 1,899
- -------------------------------------------------------------------------------------------------------------------------
Larry L. Johnson, 2000 190,000 -0- -0- -0- 120,750 -0- -0-
Senior Vice
President and 1999 -0- -0- -0- -0- -0- -0- -0-
Chief Operating
Officer 1998 -0- -0- -0- -0- -0- -0- -0-
- -------------------------------------------------------------------------------------------------------------------------
J. Melvin Stewart, 2000 212,543 -0- -0- -0- 25,200 -0- 6,376
Chairman of the
Board 1999 197,919 29,248 -0- -0- -0- -0- 6,376
1998 183,384 28,976 -0- -0- -0- -0- 5,936
=========================================================================================================================
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 the lesser of $50,000 or 10% of the
total annual salary and bonus earned by the named individuals for the
2000 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. Also does not include income required to be
recognized for income tax purposes as the result of personal use of
Company automobiles or the exercise of stock options.
2 Includes as awards under the senior management incentive plan: (a) with
respect to Mr. Brandner, 5,887 shares of Common Stock having a per share
value of $3.94 as of the June 30, 1999 award date and for 1998 6,049
shares of Common Stock having a per share fair market value of $3.38 as
of the June 30, 1998 award date; and (b) with respect to Mr. Stewart, for
1999 3,714 shares of Common Stock having a per share value of $3.94 as of
the June 30, 1999 award date and for 1998 4,293 shares of Common Stock
having a per share fair market value of $3.38 as of the June 30, 1998
award date.
-17-
3 Represents Company contributions to the 401(k) accounts of the named
executive officers.
STOCK OPTIONS GRANTED
The following table contains information concerning the grant of stock
options during fiscal 2000 to the named executive officer.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
NAME NUMBER OF % OF TOTAL EXERCISE OR EXPIRATION GRANT
SECURITIES OPTIONS BASE PRICE DATE DATE
UNDERLYING GRANTED ($/SH) PRESENT
OPTIONS GRANTED TO EMPLOYEES VALUE
IN FISCAL YEAR ($)(3)
=================================================================================================================
J. William Brandner 78,750(1) 22.8 $4.10 11/18/08 $104,250
- -----------------------------------------------------------------------------------------------------------------
Marshall S. Harris 15,750(2) 4.6 $4.10 11/18/08 $ 20,850
- -----------------------------------------------------------------------------------------------------------------
Larry L. Johnson 15,750(1) 35.1 $4.10 11/18/08 $ 20,850
105,000(2) $3.53 08/27/09 $ 99,000
- -----------------------------------------------------------------------------------------------------------------
Terry J. Long 47,250(1) 13.7 $4.10 11/18/08 $ 62,550
- -----------------------------------------------------------------------------------------------------------------
J. Melvin Stewart 25,200(1) 7.3 $4.10 11/18/08 $ 33,360
=================================================================================================================
-18-
1 These options vest at the rate of 33 1/3% per year from the November 18,
1999 grant date. All unvested options fully vest in the event of a change
in control as defined in the option agreements. Also, vested options may
not be exercised for so long as certain of our convertible debentures are
outstanding or unless and until the terms of such debentures are amended
to permit exercise. The number of options and exercise price are subject
to ratable adjustments for stock dividends and other distributions.
2 These options may not be exercised so long as certain of our convertible
debentures are outstanding or unless and until the terms of such
debentures are amended to permit such exercise.
3 The "grant date present value" is based upon the Black-Scholes option
pricing model adapted for use in valuing executive stock options. The
actual value, if any, the executive may realize upon exercise of the
option will depend on the excess of the stock price over the exercise
price on the date the option is exercised, so there is no assurance the
value realized by the executive will be at or near the value estimated by
the Black-Scholes model. The principal assumptions incorporated into the
valuation model by the Company are as follows: (i) dividend yield of 5%,
(ii) expected volatility of 40%, (iii) risk-free interest rate of 6%, and
(iv) expected life of 7 years. No assumptions were made regarding
nontransferability or risk of forfeiture. The assumptions chosen
materially impact the resulting valuations.
OPTION/SAR EXERCISES AND HOLDINGS
The following table provides information with respect to the named
executive officers concerning the exercise of options and/or stock appreciation
rights ("SARs") during the last fiscal year and the number of unexercised
options and SARs held as of the end of the fiscal year.
AGGREGATED OPTION/SAR EXERCISES IN FISCAL 2000,
AND FISCAL YEAR-END OPTION AND SAR VALUES
Number of
Securities Value of
Underlying Unexercised
Unexercised In-The-Money
NUMBER Options/SARs Options/SARs
OF Shares Value At FY-End At FY-End
Acquired on Realized
NAME Exercise ($) Exercisable/ Exercisable/
Unexercisable Unexercisable
=======================================================================================================================
J. William Brandner, President and 79,707 $183,725 66,154/ $160,754/
Chief Executive Officer 78,750 $0.00
- -----------------------------------------------------------------------------------------------------------------------
J. Melvin Stewart 133,706 $433,207 0/ $0.00/
Chairman of the Board 25,200 $ 56,750 26,250 $0.00
=======================================================================================================================
PENSION PLANS
The Display Technologies, Inc. 401(k) profit sharing plan covers all
employees with more than six months of service and allows employees to defer up
to 15% of their income and contribute to the plan. The Company contributes to
the plan at a discretionary matching rate of 50% of the first 6% contributed by
the employee. Company contributions are in the form of the Company's common
stock.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT ARRANGEMENTS
The Company is party to an employment agreement with Mr. James C. Taylor,
under which he serves as President of the Company. The agreement is extended
automatically for one-year periods unless the Company or Mr. Taylor provides
written notice to the contrary not less than sixty days prior to the extension
date. Mr. Taylor presently receives $225,000 base salary per year. The agreement
also provides for the payment of severance in the event the Company elects to
terminate the agreement without cause or Mr. Taylor elects to terminate the
agreement with cause.
The agreement with Mr. Taylor contains confidentiality and noncompetition
provisions effective during the term of the agreement and for a period following
termination of employment.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION FOR FISCAL 2000
The following report on executive compensation is made solely with respect
to fiscal year 2000. The Company's executive compensation practices have been
substantially revised for fiscal year 2001.
COMPENSATION PHILOSOPHY. The Compensation Committee establishes and
reviews the salaries and other compensation paid to the Company's executive
officers. The Company's executive compensation policy as implemented by the
committee is designed to provide a competitive compensation program that will
enable the Company to attract, motivate, reward and retain executives who have
the skills, experience and talents required to promote the short- and long-term
financial performance and growth of the Company. The compensation policy is
based on the principle that the financial rewards to the executives must be
aligned with the financial interests of the shareholders of the Company. In this
manner, the Company seeks to meet its ultimate responsibility to its
shareholders.
The Company's executive compensation for fiscal 2000 had three elements:
base salary, annual incentive compensation and long-term incentive compensation.
The following is a summary of the considerations underlying each element.
BASE SALARY. The committee determined the salary ranges for each of the
executive officer positions of the Company, based upon the level and scope of
the responsibilities of the office and the pay levels of similarly-positioned
executive officers in comparable companies. The evaluation of the chief
executive officer was of paramount importance in setting base salaries of other
executive officers. The comparison of compensation levels was based on surveys
of various companies both within and outside the sign manufacturing industry.
Certain of these companies were included in the peer group represented in the
index used for stock performance comparisons elsewhere in this Statement under
the caption "Comparison of Five-Year Cumulative Returns." The committee was
satisfied that it had reasonably accurate information with respect to salary
ranges for the surveyed companies.
-19-
The committee considered (i) the Company's performance as evidenced in
changes in the price of the Common Stock as compared to changes in its industry
and the broader economic environment, (ii) the chief executive officer's
recommendations with respect to a particular officer, (iii) the officer's
individual performance, (iv) any significant changes in the officer's level of
responsibility, and (v) each officer's then-current salary within the range of
salaries for such position. The committee included significant qualitative
components in evaluating the individual performance of each executive officer.
These components included the officer's leadership, accomplishment of goals,
team building and motivational skills. They also included adaptability to rapid
change and assimilation of new technical knowledge to meet the demands of the
industry's customers. In this qualitative evaluation, the committee exercised
its collective judgment as to the officer's contributions to the growth and
success of the Company during the prior year and the expected contributions of
such officer in the future. Generally, salary increases were made retroactive to
the start of the fiscal year.
ANNUAL INCENTIVE COMPENSATION. The senior management incentive plan called
for the establishment annually of an incentive pool to be distributed if four
out of the following seven corporate goals were 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 must be 15% higher than the quoted closing price at the
end of the previous fiscal year.
The criteria for establishing the amount of the incentive pool was
determined by the Compensation Committee at the beginning of the fiscal year.
Each participant had specific individual goals based on his direct
responsibilities and his contributions to the attainment of the corporate goals.
These objectives were established at the beginning of the fiscal year by the
chief executive officer and submitted to the Compensation Committee for
approval. The goals were communicated to the participants as the basis for
making awards. Awards to participants were to be one-third in cash, one-third in
newly issued shares of Company Stock and one-third as an adjustment of annual
base salary. In fiscal 2000, the Company failed to achieve a sufficient number
of performance goals under the senior management plan for the creation of an
incentive pool. Accordingly, no incentive compensation was paid to the named
executive officers under the plan for fiscal 2000.
LONG-TERM INCENTIVE COMPENSATION. The Compensation Committee believed that
long-term incentive compensation in the form of stock options was the most
direct way of making executive compensation dependent upon increases in
shareholder value. The Company's stock option plans provided the means through
which executive officers could build an investment in Company stock which would
align the officers' economic interest with the interest of shareholders. The
value of stock options historically had increased as the result of increases in
the price of an issuer's stock, and such options were highly valued by
employees. The committee believed that the granting of stock options was a
particularly important component of its success in retaining talented management
employees.
-20-
The exercise price of each option was generally the market price of the
Common Stock on the date of grant. The committee believed that stock options
gave the Company's executive officers greater incentives throughout the term of
the options to strive to operate the Company in a manner that directly effects
the financial interest of the shareholders both on a long-term, as well as a
short-term, basis.
In determining the number of options to grant to executive officers,
the committee considered on a subjective basis the same factors as it did in
determining the other components of compensation, with no single factor accorded
special weight. The recommendation of the chief executive officer was of
paramount importance in determining awards to persons other than himself.
COMPENSATION OF THE FORMER CHIEF EXECUTIVE OFFICER. In setting the
compensation of Mr. Brandner, the Company's former President and Chief Executive
Officer, the Compensation Committee applied the quantitative, performance-based
criteria of the senior management incentive plan described above. In determining
the portion of the bonus pool under the plan to be allocated to Mr. Brandner,
the committee considered such qualitative criteria as his management
responsibilities, his efforts in aiding the Company in achieving the performance
goals contained in the senior management incentive plan, and the results of his
efforts in helping the Company increase profitable growth generally. The total
compensation package of Mr. Brandner was designed to be competitive while
creating awards for performance in line with the financial interests of our
shareholders. The committee believes that the 2000 compensation package for Mr.
Brandner was entirely consistent with this policy.
THE COMPENSATION COMMITTEE
Thomas N. Grant, Chairman Lester Jacobs
Kevin L. Jackson William A. Retz
FREEZE OF EXECUTIVE SALARIES
On September 29, 2000, our Board of Directors approved an indefinite
freeze of compensation levels of executive officers of the Company and its
subsidiaries.
-21-
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
A line graph presentation appears below, showing a five-year comparison of
the cumulative total return on the Company's Common Stock to the S&P 500 index,
the Nasdaq Stock Market index and an index of peer group companies selected by
the Company. The peer group consists of Daktronics, Inc., Trans-Lux Corporation,
Mikohn Gaming Corporation, Trans-Industries, Inc. and Federal Sign Corp. The
graph assumes $100 invested on June 30, 1995, in the Company's Common Stock and
in each index, with the subsequent reinvestment of dividends on a quarterly
basis.
COMPARISON OF FIVE-YEAR CUMULATIVE RETURNS AMONG
THE COMPANY, S&P 500 INDEX, NASDAQ INDEX AND PEER GROUP INDEX
[CHART BASED ON FOLLOWING DATA APPEARS HERE]
DATE DTEK Stock S&P 500 Index Nasdaq Index Peer Group
---- ------------- ------------- ------------ ----------
06/30/95 100.00 100.00 100.00 100.00
06/30/96 159.62 126.18 128.39 156.48
06/30/97 339.23 170.12 156.14 136.97
06/30/98 457.96 222.02 205.59 218.94
06/30/99 561.07 272.23 294.06 150.73
06/30/00 439.53 292.18 437.18 161.57
Pursuant to the requirements of the Exchange Act, the Company has
caused this Statement to be signed on its behalf by the undersigned, thereunto
duly authorized.
DISPLAY TECHNOLOGIES, INC.
By: /s/ James C. Taylor
James C. Taylor, President and
Chief Executive Officer
Dated: April 9, 2001