Blueprint
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment
No. __)
Filed
by the Registrant ☑
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))
☐ Definitive Proxy Statement
☐ Definitive Additional Materials
☐ Soliciting Material under Rule 14a-12
RELM Wireless Corporation
|
(Name of Registrant as Specified In Its Charter)
|
|
(Name of Person(s) Filing Proxy Statement, if Other Than the
Registrant)
|
Payment
of Filing Fee (Check the appropriate box):
☑ No fee required
☐ Fee computed on table below per Exchange Act Rules
14a-6(i)(1) and 0-11.
(1)
Title of each class of securities to which transaction
applies:
(2)
Aggregate number of securities to which transaction
applies:
(3) Per
unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was
determined):
(4)
Proposed maximum aggregate value of transaction:
(5)
Total fee paid:
☐ Fee paid previously with preliminary
materials.
☐ Check box if any part of the fee is offset as
provided by Exchange Act Rule 0-11(a)(2) and identify the filing
for which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the form or
schedule and the date of its filing.
(1)
Amount Previously Paid:
(2)
Form, Schedule or Registration Statement No.:
(3)
Filing Party:
(4)
Date Filed:
PRELIMINARY COPY, DATED MARCH 15, 2018 – SUBJECT TO
COMPLETION
RELM Wireless Corporation
7100 Technology Drive
West Melbourne, Florida 32904
April
16, 2018
Dear
Stockholder:
You are
cordially invited to attend the 2018 annual meeting of stockholders
of RELM Wireless Corporation, which we will hold on
Monday, June 4, 2018, at 10:00 a.m., local time, at our corporate
offices at 7100 Technology Drive, West Melbourne, Florida
32904.
We are
pleased to take advantage of Securities and Exchange Commission
rules that allow issuers to furnish proxy materials to their
stockholders on the Internet. We believe these rules allow us to
provide our stockholders with the information they need, while
lowering the costs of delivery and reducing the environmental
impact of our annual meeting. On or about April 20, 2018, we expect
to begin mailing a Notice of Internet Availability of Proxy
Materials, or E-proxy notice, to our stockholders of record as of
the close of business on April 13, 2018. The E-proxy notice
contains instructions for your use of this process, including how
to access our proxy statement, proxy card and annual report and how
to vote on the Internet. In addition, the E-proxy notice contains
instructions on how you may receive a paper copy of the proxy
statement, proxy card and annual report or elect to receive your
proxy statement, proxy card and annual report over the
Internet.
If you
are unable to attend the meeting in person, it is very important
that your shares be represented and voted at the annual meeting.
You may vote your shares over the Internet as described in the
E-proxy notice. Alternatively, if you received a paper copy of the
proxy card by mail, please complete, sign, date and promptly return
the proxy card in the self-addressed stamped envelope provided. You
may also vote by telephone as described in your proxy card. Voting
by telephone, over the Internet or by mailing a proxy card will not
limit your right to attend the annual meeting and vote your shares
in person.
We look
forward to seeing you at the meeting.
|
Sincerely,
|
|
|
|
|
|
/s/ D. Kyle Cerminara
|
|
|
D. Kyle Cerminara
|
|
|
Chairman of the Board of Directors
|
|
PRELIMINARY COPY, DATED MARCH 15, 2018 – SUBJECT TO
COMPLETION
RELM WIRELESS CORPORATION
7100 Technology Drive
West Melbourne, Florida 32904
NOTICE OF 2018 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MONDAY, JUNE 4, 2018
To the
stockholders of RELM Wireless Corporation:
The
2018 annual meeting of stockholders of RELM Wireless Corporation
will be held on Monday, June 4, 2018, at 10:00 a.m., local time, at
our corporate offices at 7100 Technology Drive, West Melbourne,
Florida 32904, for the following purposes:
1.
To elect seven
directors named in the proxy statement to serve on our board of
directors until the next annual meeting of stockholders and until
their respective successors are duly elected and
qualified;
2.
To ratify the
appointment of Moore Stephens Lovelace, P.A. as our independent
registered public accounting firm for fiscal year
2018;
3.
To approve an
amendment to our Articles of Incorporation to change our corporate
name from RELM Wireless Corporation to BK Technologies, Inc.;
and
4.
To transact such
other business properly brought before the meeting and any
adjournment or postponement of the meeting.
Only
stockholders of record at the close of business on April 13, 2018
are entitled to notice of, and to vote at, the annual meeting and
any adjournment or postponement of the meeting. Each share of
common stock is entitled to one vote. A list of stockholders
entitled to vote at the annual meeting will be available for
inspection by our stockholders, for any purpose germane to the
meeting, at the annual meeting and during ordinary business hours
beginning 10 days prior to the date of the annual meeting, at our
principal executive offices at 7100 Technology Drive, West
Melbourne, Florida 32904.
Whether
or not you plan to attend the meeting in person, please vote your
shares over the Internet, as described in the Notice of Internet
Availability of Proxy Materials, or E-proxy notice. Alternatively,
if you received a paper copy of the proxy card by mail, please
complete, sign, date and promptly return the proxy card in the
self-addressed stamped envelope provided. You may also vote your
shares by telephone as described in your proxy card. Voting by
telephone, over the Internet or by mailing a proxy card will not
limit your right to attend the annual meeting and vote your shares
in person.
All
stockholders are cordially invited to attend the annual
meeting.
|
By
Order of the Board of Directors,
|
|
|
|
|
|
/s/ William P. Kelly
|
|
|
William P. Kelly, Secretary
|
|
West
Melbourne, Florida
April
16, 2018
Important Notice Regarding the Availability of Proxy Materials for
the Annual Stockholder Meeting to be held on June 4, 2018:
Our proxy statement, proxy card and annual report on Form 10-K for
the year ended December 31, 2017 are available at https://www.iproxydirect.com/RWC.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL
MEETING. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING,
PLEASE VOTE YOUR PROXY TODAY. YOU CAN VOTE BY INTERNET, BY
TELEPHONE OR BY MAIL USING THE INSTRUCTIONS INCLUDED ON THE NOTICE
OF INTERNET AVAILABILITY OF PROXY MATERIALS OR PROXY
CARD.
PRELIMINARY COPY, DATED MARCH 15, 2018 – SUBJECT TO
COMPLETION
RELM WIRELESS CORPORATION
________________________________________________________
2018 ANNUAL MEETING OF STOCKHOLDERS
JUNE 4, 2018
________________________________________________________
PROXY STATEMENT
________________________________________________________
This
proxy statement contains information related to the 2018 annual
meeting of stockholders of RELM Wireless Corporation (“RELM,” the “Company,” “we,” “our” or “us”) to be held on Monday, June 4,
2018, at 10:00 a.m., local time, at our corporate offices at 7100
Technology Drive, West Melbourne, Florida 32904, and at any
adjournments or postponements thereof. We are using the Securities
and Exchange Commission rules that allow issuers to furnish proxy
materials to their stockholders on the Internet. On or about April
20, 2018, we expect to begin mailing a Notice of Internet
Availability of Proxy Materials, which is referred to herein as the
“E-proxy
notice,” to each holder
of record of our common stock as of the close of business on April
13, 2018, the record date for the meeting. The E-proxy notice and
this proxy statement summarize the information you need to know to
vote by proxy or in person at the annual meeting. You do not need
to attend the annual meeting in person in order to
vote.
________________________________________________________
TABLE OF CONTENTS
|
1
|
|
4
|
|
7
|
|
11
|
|
15
|
|
18
|
|
19
|
|
19
|
|
23
|
|
24
|
|
24
|
|
27
|
|
28
|
|
28
|
|
29
|
|
30
|
|
31
|
|
31
|
What
is the purpose of the annual meeting?
At the
annual meeting, we are asking stockholders:
●
To elect seven
directors named in this proxy statement to our board of directors
until the next annual meeting of stockholders and until their
respective successors are duly elected and qualified;
●
To ratify the
appointment of Moore Stephens Lovelace, P.A. (“Moore Stephens Lovelace”) as our independent registered
public accounting firm for the fiscal year ending December 31, 2018
(“fiscal 2018”);
●
To approve an
amendment to our Articles of Incorporation to change our corporate
name from RELM Wireless Corporation to BK Technologies, Inc.;
and
●
To transact such
other business properly brought before the meeting and any
adjournment or postponement of the meeting.
Why did I receive a Notice of Internet Availability of Proxy
Materials?
The
rules of the Securities and Exchange Commission (the “SEC”) permit us to make our proxy
materials available to beneficial owners of our common stock
electronically over the Internet without having to mail printed
copies of the proxy materials. Accordingly, on or about April 20,
2018, we are sending a Notice of Internet Availability of Proxy
Materials, which is referred to herein as the “E-proxy notice,” to our beneficial owners. All
beneficial owners will have the ability to access the proxy
materials, including this proxy statement, the form of proxy card
and our annual report for the fiscal year ended December 31, 2017
(“fiscal 2017”), on the website referred to in the
E-proxy notice or to request a printed set of the proxy materials.
Instructions on how to access the proxy materials over the Internet
or to request a printed copy may be found in the E-proxy notice. In
addition, beneficial owners may request to receive proxy materials
in printed form by mail or electronically by email on an ongoing
basis.
On or
about April 20, 2018, we will begin mailing paper copies of our
proxy materials to stockholders who have requested them. Those
stockholders who do not receive the E-proxy notice, including
stockholders who have previously requested to receive paper copies
of proxy materials, will receive a copy of this proxy statement,
the proxy card and our annual report for fiscal 2017 by
mail.
Who is entitled to notice of, and to vote, at the annual
meeting?
You are
entitled to notice of the annual meeting and to vote, in person or
by proxy, at the annual meeting if you owned shares of our common
stock as of the close of business (5:00 p.m. EDT) on April 13,
2018, the record date of the annual meeting. On the record date,
[•] shares of our common stock were issued and outstanding
and held by [•] holders of record. Holders of record of our
common stock on the record date are entitled to one vote per share
at the annual meeting.
Who can attend the meeting?
All
stockholders as of the record date, or their duly appointed
proxies, may attend. Please note that if you hold shares in
“street name” (that is, through a broker or other
nominee), you will need to bring a copy of a brokerage statement
reflecting your stock ownership as of the record date. If you want
to vote shares that you hold in street name in person at the annual
meeting, you must bring a legal proxy in your name from the broker
or other nominee that holds your shares.
What constitutes a quorum?
If a
majority of the shares of our common stock outstanding on the
record date is represented either in person or by proxy at the
annual meeting, a quorum will be present at the annual meeting.
Shares held by persons attending the annual meeting but not voting,
shares represented in person or by proxy and for which the holder
has abstained from voting, and broker “non-votes” will be counted as present at the
annual meeting for purposes of determining the presence or absence
of a quorum.
What are broker “non-votes”?
A
broker non-vote occurs when a brokerage firm or other nominee
holding shares for a beneficial owner does not vote on a particular
proposal because the brokerage firm or other nominee did not
receive voting instructions from the beneficial owner and does not
have authority to vote on that particular proposal. Brokers and
other nominees are subject to the rules of the New York Stock
Exchange (the “NYSE”). The NYSE rules direct that
certain matters submitted to a vote of stockholders are considered
“routine” proposals. Brokers or other
nominees generally may vote on such proposals on behalf of
beneficial owners who have not furnished voting instructions,
subject to the rules of the NYSE concerning transmission of proxy
materials to beneficial owners, and subject to any proxy voting
policies and procedures of those brokerage firms or other nominees.
For “non-routine” proposals, brokers or other
nominees may not vote on such proposals unless they have received
voting instructions from the beneficial owner, and, to the extent
that they have not received voting instructions, brokers or other
nominees report such number of shares as “non-votes.”
Under
NYSE rules, the election of directors (Proposal 1) and the
amendment to our Articles of Incorporation to change our corporate
name (Proposal 3) are considered to be “non-routine” matters. This means that brokers or
other nominees who have not been furnished voting instructions from
their clients will not be authorized to vote in their discretion on
these proposals. The ratification of the appointment of an
independent registered public accounting firm (Proposal 2) is a
“routine” matter. This means that brokers or
other nominees who have not been furnished voting instructions from
their clients will be authorized to vote for this proposal. For
beneficial stockholders, if you do not give your broker or other
nominee specific instructions, your shares will not be voted on
Proposals 1 or 3 and may be voted by the brokerage firm or other
nominee for Proposal 2. Broker non-votes will have no effect on the
outcome of the voting on Proposals 1 and 2, but will be treated as
votes “AGAINST” Proposal 3.
How will abstentions be counted?
Because
the election of directors requires only a plurality vote,
abstentions will have no impact upon the election of directors.
Abstentions will also have no impact on the outcome of Proposal 2
(ratification of the independent registered public accounting
firm), but will be treated as votes “AGAINST” Proposal
3 (amendment to our Articles of Incorporation to change our
corporate name).
How do I vote?
Whether
or not you plan to attend the annual meeting, we urge you to vote
your shares over the Internet as described in the E-proxy notice.
Alternatively, if you received a paper copy of the proxy card by
mail, please complete, sign, date and promptly return the proxy
card in the self-addressed stamped envelope provided. You may also
vote your shares by telephone as described in your proxy card.
Authorizing your proxy over the Internet, by mailing a proxy card
or by telephone will not limit your right to attend the annual
meeting and vote your shares in person. Your proxy (one of the
individuals named in your proxy card) will vote your shares per
your instructions. If you fail to provide instructions on a proxy
properly submitted via the Internet, mail or telephone, your proxy
will vote, as recommended by the board of directors, (1) to elect
to our board of directors the seven director nominees named in this
proxy statement, (2) to ratify the appointment of Moore Stephens
Lovelace as our independent registered public accounting firm for
fiscal 2018, and (3) to amend our Articles of Incorporation to
change our corporate name from RELM Wireless Corporation to BK
Technologies, Inc.
If you
have shares held by a broker or other nominee, you may instruct
your broker or nominee to vote your shares by following the
instructions that the broker or nominee provides to you. Most
brokers and nominees allow you to vote by mail, telephone and on
the Internet. As indicated above, under NYSE rules, the election of
directors (Proposal 1) and the amendment to our Articles of
Incorporation to change our corporate name (Proposal 3) are
“non-routine” matters, meaning that brokers or
other nominees who have not been furnished voting instructions from
their clients will not be authorized to vote in their discretion on
these proposals. The ratification of the appointment of Moore
Stephens Lovelace as our independent registered public accounting
firm for fiscal 2018 (Proposal 2) is a matter considered
“routine,” meaning that brokers or nominees
who have not been furnished voting instructions from their clients
will be authorized to vote on that proposal.
Can I change my vote after I have voted?
Yes.
Voting by telephone, over the Internet or by mailing a proxy card
does not preclude a stockholder from voting in person at the annual
meeting. A stockholder may revoke a proxy, whether submitted via
telephone, the Internet or mailed, at any time prior to its
exercise by filing with our Corporate Secretary a duly executed
revocation of proxy, by properly submitting, either by telephone,
mail or Internet, a proxy to our Corporate Secretary bearing a
later date or by appearing at the annual meeting and voting in
person. Attendance at the annual meeting will not itself constitute
revocation of a proxy.
What are the board’s recommendations?
The
board unanimously recommends a vote “FOR”:
●
election to our board of each of the seven
director nominees named in this proxy statement;
●
ratification of the appointment of Moore
Stephens Lovelace as our independent registered public accounting
firm for fiscal 2018; and
●
the amendment to our Articles of Incorporation to change our
corporate name from RELM Wireless Corporation to BK Technologies,
Inc.
We do
not expect that any other matters will be brought before the annual
meeting. If, however, other matters are properly presented, the
persons named as proxies will vote the shares represented by
properly executed proxies in accordance with their judgment with
respect to those matters, including any proposal to adjourn or
postpone the annual meeting.
What vote is required to approve the proposals?
Proposal 1: Election of
Directors. Directors will be elected by a plurality of the
votes cast, either in person or by proxy, at the annual meeting
(meaning that the seven director nominees who receive the highest
number of shares voted “for” their election are elected). You
may vote “for” or “withhold” authority to vote for each of the
director nominees. If you “withhold” authority to vote with respect to
one or more director nominees, your vote will have no effect on the
election of such nominees. Broker non-votes will also have no
effect on the election of the director nominees.
Proposal 2: Ratification of
Appointment of Moore Stephens Lovelace. The number of votes
cast “for” the ratification of the appointment
of Moore Stephens Lovelace as our independent registered public
accounting firm for fiscal 2018, either in person or by proxy, at
the annual meeting must exceed the number of votes cast
“against” ratification. Abstentions and
broker non-votes will have no effect on the outcome of the
vote.
Proposal 3: Amendment to our Articles of
Incorporation to Change Our Corporate Name. Approval of the
amendment to our Articles of Incorporation to change our corporate
name from RELM Wireless Corporation to BK Technologies, Inc.
requires the affirmative vote of the holders of at least a majority
of the issued and outstanding shares of the Company’s common
stock. You may vote “for” or “against” the
amendment. Abstentions and broker non-votes will be treated as
votes “AGAINST” the proposal.
Other Items. In the
event that other items are properly brought before the annual
meeting, under Nevada law, each matter other than the election of
directors will be approved if the number of votes cast in favor of
the item by the stockholders entitled to vote exceeds the number of
votes cast in opposition to the matter. 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 not be counted as a vote cast on the matter and therefore will
not affect the outcome of the matter.
As of
the record date, our directors and executive officers and their
affiliates owned and were entitled to vote approximately [•]
shares of our common stock, which represented approximately
[•]% of our common stock outstanding on that date. We
currently anticipate that all of these persons will vote their and
their affiliates’ shares
in favor of the director nominees, in favor of ratification of the
appointment of Moore Stephens Lovelace and in favor of the
amendment to our Articles of Incorporation to change our corporate
name from RELM Wireless Corporation to BK Technologies,
Inc.
Who pays for the preparation of the proxy and soliciting
proxies?
We are
making this solicitation of proxies and have paid the entire
expense of preparing, printing and mailing the E-proxy notice and,
to the extent requested by our stockholders, this proxy statement
and any additional materials furnished to stockholders. In addition
to solicitations by mail, our directors, officers and employees may
solicit proxies from stockholders by telephone, e-mail or other
electronic means, or in person. These persons will not receive
additional compensation for soliciting proxies. Arrangements also
will be made with brokerage houses and other custodians, nominees
and fiduciaries for the forwarding of solicitation materials to the
beneficial owners of stock held of record by these persons, and we
will reimburse them for reasonable out-of-pocket
expenses.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The
table below sets forth information regarding the beneficial
ownership of our common stock as of the record date, April 13,
2018, by the following individuals or groups:
●
each person who is known by us to own
beneficially more than 5% of our common stock;
●
each of our directors and nominees for
director;
●
each of our named executive officers
identified in the “Summary Compensation Table For
2016-2017” appearing in
this proxy statement (the “Named Executive Officers”);
and
●
all of our directors and executive officers
as a group.
Beneficial
ownership is determined in accordance with the rules of the SEC and
generally includes voting or investment power with respect to
securities. Shares of our common stock that are subject to our
stock options that are presently exercisable or exercisable within
60 days of April 13, 2018 are deemed to be outstanding and
beneficially owned by the person holding the stock options for the
purpose of computing the percentage of ownership of that person,
but are not treated as outstanding for the purpose of computing the
percentage of any other person.
Unless
indicated otherwise below, the address of our directors, director
nominees and executive officers is c/o RELM Wireless Corporation,
7100 Technology Drive, West Melbourne, Florida 32904. Except as
indicated below, the persons named in the table
have sole voting and investment power with respect to all shares of
common stock beneficially owned by them. As of April 13, 2018, we
had outstanding [•] shares of our common stock.
|
|
Shares of Common Stock
Beneficially Owned
|
Name and Address of Beneficial Owner
|
|
Number of Shares
|
|
Percent of Class
|
Beneficial Owners of More Than 5% of
Our Common Stock:
|
|
|
|
|
Fundamental
Global Investors, LLC and Ballantyne Strong, Inc.
|
|
4,489,264(1)
|
|
32.4%
|
D. Kyle
Cerminara
|
|
4,499,264(1)(2)(6)(10)
|
|
32.5%
|
Lewis
M. Johnson
|
|
4,494,264(1)(3)(6)(10)
|
|
32.5%
|
Benchmark
Capital Advisors
|
|
1,573,253(4)
|
|
11.4%
|
Donald
F.U. Goebert
|
|
1,464,538(5)
|
|
10.6%
|
|
|
|
|
|
Directors, Director Nominees and Named
Executive Officers (not otherwise included
above):
|
|
|
|
|
William
P. Kelly
|
|
75,827(6)(7)(11)
|
|
*
|
Timothy
A. Vitou
|
|
57,500(6)(11)
|
|
*
|
James
R. Holthaus
|
|
1,000(6)(11)
|
|
—
|
David
P. Storey
|
|
161,311(8)(11)
|
|
1.2%
|
Michael
R. Dill
|
|
—(10)
|
|
—
|
Charles
T. Lanktree
|
|
7,916(9)(10)
|
|
*
|
General
E. Gray Payne
|
|
15,000(6)(10)
|
|
*
|
John W.
Struble
|
|
—(10)
|
|
—
|
Ryan
R.K. Turner
|
|
352(10)
|
|
*
|
|
|
|
|
|
All
current directors and executive officers as a group (11
persons)
|
|
4,661,859(12)
|
|
33.4%
|
______________
*Less
than 1%
(1)
The amount shown
and the following information is derived from a Schedule 13D/A
filed by Fundamental Global Investors, LLC (“Fundamental Global”) and its affiliates on February 2,
2018. Fundamental Global is deemed to beneficially own the shares
disclosed as directly owned by certain of its affiliates, including
1,147,087 shares, or 8.3% of outstanding shares, disclosed as
directly owned by Ballantyne Strong, Inc. (“Ballantyne Strong”), which Fundamental Global is
deemed to beneficially own by virtue of being the largest
stockholder of Ballantyne Strong and D. Kyle Cerminara’s positions as the Chief Executive
Officer and Chairman of the Board of Directors of Ballantyne Strong
and as a principal of Fundamental Global. Ballantyne Strong has
shared voting and dispositive power with respect to all 1,147,087
shares reported as directly owned by Ballantyne Strong in the
Schedule 13D/A. Ballantyne Strong’s business address is 11422 Miracle
Hills Drive, Suite 300, Omaha, Nebraska 68154. Fundamental Global
expressly disclaims beneficial ownership of the shares disclosed as
directly owned by Ballantyne Strong. According to the Schedule
13D/A, CWA Asset Management Group, LLC (“CWA”) reports ownership of 1,009,337
shares, or 7.3% of outstanding shares, which are held in its
customer accounts and are included in the number of the shares
listed in the table above. CWA has the dispositive power over the
shares held in its customer accounts while CWA’s customers retain the voting power
over their shares. CWA’s
business address is 9130 Galleria Court, Third Floor, Naples,
Florida 34109. According to the Schedule 13D/A, additional
affiliates of Fundamental Global hold 356,876 shares, which
represents 2.6% of outstanding shares and increases the total
number of shares beneficially owned by Fundamental Global to
4,846,140 shares, or 35% of outstanding shares. Fundamental Global
has shared voting power with respect to 3,479,927 of the shares
listed in the table above and dispositive power with respect to all
of these shares. Fundamental Global’s business address is 4201 Congress
Street, Suite 140 Charlotte, North Carolina 28209.
(2)
Mr. Cerminara is
the Chief Executive Officer, Co-Founder and Partner of Fundamental
Global, Co-Chief Investment Officer of CWA, and Chief Executive
Officer and Chairman of the Board of Directors of Ballantyne
Strong. Due to his positions with Fundamental Global and Ballantyne
Strong, Mr. Cerminara is deemed to beneficially own the 4,489,264
shares disclosed as directly owned by certain affiliates of
Fundamental Global, including 1,147,087 shares disclosed as
directly owned by Ballantyne Strong. Mr. Cerminara expressly
disclaims beneficial ownership of these shares. The business
addresses for Mr. Cerminara are c/o Fundamental Global Investors,
LLC, 4201 Congress Street, Suite 140, Charlotte, North Carolina
28209; c/o Ballantyne Strong, Inc., 11422 Miracle Hills Drive,
Suite 300, Omaha, Nebraska 68154; and 131 Plantation Ridge Drive,
Suite 100, Mooresville, North Carolina 28117.
(3)
Mr. Johnson is the
President, Co-Founder and Partner of Fundamental Global, serves as
Co-Chief Investment Officer of CWA, and is a director of Ballantyne
Strong. Accordingly, Mr. Johnson is deemed to beneficially own the
4,489,264 shares disclosed as directly held by affiliates of
Fundamental Global, which includes 1,147,087 shares disclosed as
directly owned by Ballantyne Strong. Mr. Johnson expressly
disclaims beneficial ownership of these shares. The business
addresses for Mr. Johnson are c/o Fundamental Global Investors,
LLC, 4201 Congress Street, Suite 140, Charlotte, North Carolina
28209; and c/o CWA Asset Management Group, LLC, 9130 Galleria
Court, Third Floor, Naples, Florida 34109.
(4)
The amount shown
and the following information is derived from a Schedule 13G/A
filed by Benchmark Capital Advisors (“Benchmark”) on March 13, 2015. According to
the Schedule 13G/A, Benchmark beneficially owns 1,573,253 shares,
and has sole voting and dispositive power with respect to 882,697
of these shares and shared voting and dispositive power with
respect to 1,573,253 of these shares. Benchmark’s business address is 100 Wall
Street, 8th Floor, New York, New York 10005.
(5)
The amount shown is
based on Mr. Goebert’s
Form 4 filed on December 30, 2016, plus 6,255 shares acquired upon
option exercises since the filing of the Form 4. Mr.
Goebert’s primary address is 3382 Harbor Road S., Tequesta,
Florida 33469.
(6)
Share ownership of
the following persons includes options to purchase our common
shares presently exercisable or exercisable within 60 days of April
13, 2018 as follows: for Mr. Cerminara – 10,000 shares; for Mr. Johnson
– 5,000 shares; for Mr.
Kelly – 49,000 shares;
for Mr. Vitou – 25,000 shares; for Mr. Holthaus – 1,000
shares; and for General Payne – 5,000 shares.
(7)
Includes 26,827
shares held jointly by Mr. Kelly with his wife.
(8)
Mr. Storey, who is
a Named Executive Officer, previously served as our President and
Chief Executive Officer. He resigned from all positions held with
the Company as of the close of business on January 16, 2017. The
amount shown includes 45,000 shares received upon Mr.
Storey’s exercise of a fully vested option on March 8,
2017.
(9)
Includes 7,702
shares directly owned by the Donna B. Lanktree Family Trust, the
trustee of which is Donna B. Lanktree, the spouse of Mr.
Lanktree.
(10)
The named person is
a director and a nominee for director at the annual
meeting.
(11)
The named person is
a Named Executive Officer.
(12)
Includes 4,489,264
shares reported as beneficially owned by Fundamental Global, of
which Messrs. Cerminara and Johnson are deemed to have beneficial
ownership by virtue of their respective positions with Fundamental
Global and Ballantyne Strong. Includes 26,827 shares held jointly
by Mr. Kelly with his wife. Includes 7,702 shares directly owned by
the Donna B. Lanktree Family Trust, the trustee of which is Donna
B. Lanktree, the spouse of Mr. Lanktree. Includes options to
purchase our common shares presently exercisable or exercisable
within 60 days of April 13, 2018 as follows: for Mr. Cerminara
– 10,000 shares; for Mr.
Johnson – 5,000 shares;
for Mr. Kelly – 49,000
shares; for Mr. Vitou – 25,000 shares; for Mr. Holthaus
– 1,000 shares; and for General Payne – 5,000 shares.
Randy Willis, an executive officer of the Company, was appointed as
Chief Operating Officer of the Company effective March 14, 2018,
having previously served as Vice
President of Operations since August 2017. Mr. Willis, who does not
directly or beneficially own any common shares, is not
separately included in the table because he was not a Named
Executive Officer for fiscal 2017.
The
following options are not reflected in the table as they are not
presently exercisable or exercisable within 60 days of April 13,
2018: options to purchase 29,000 common shares held by Mr.
Holthaus, options to purchase 30,000 common shares held by Mr.
Vitou, options to purchase 36,000 common shares held by Mr. Kelly
and options to purchase 25,000 shares held by Mr. Willis. In
addition, the following options granted on March 14, 2018 are not
reflected in the table: options to purchase 30,000 common shares
granted to Mr. Vitou and options to purchase 20,000 common shares
granted to each of Messrs. Kelly, Holthaus and Willis.
The
table also does not include 5,479 restricted stock units held by
each of Messrs. Cerminara, Dill, Johnson, Lanktree, Struble and
Turner and General Payne, which were granted on June 15, 2017 under
the Company’s 2017 Incentive Compensation Plan. These
restricted stock units vest in full 12 months after the grant date,
subject to the recipient’s continued service as a director of
the Company through such date. Each restricted stock unit
represents a contingent right to receive one share of common stock
of the Company. No restricted stock units have vested as of April
13, 2018 or will vest within 60 days of such date.
PROPOSAL 1: ELECTION OF
DIRECTORS
General
At the
annual meeting, seven nominees will be elected as directors. Our
board of directors currently consists of seven members, all of whom
are standing for re-election at the annual meeting. At the 2017
annual meeting, our stockholders elected D. Kyle Cerminara, Michael
R. Dill, Lewis M. Johnson, Charles T. Lanktree, General E. Gray
Payne, John W. Struble and Ryan R.K. Turner as directors. Our board
of directors, based on the recommendation of the nominating and
governance committee, has nominated each of these individuals to
stand for re-election at the annual meeting. We expect each nominee
for director to be able to serve if elected. If any nominee is not
able to serve, proxies will be voted in favor of the remainder of
those nominated and may be voted for substitute nominees, unless
our board of directors chooses to reduce the number of directors
serving on the board.
The directors elected at the annual meeting will serve until the
next annual meeting of stockholders and until their respective
successors are duly elected and qualified.
We are
of the view that the continuing service of qualified incumbent
directors promotes stability and continuity in the function of the
board of directors, contributing to the board’s ability to work as a collective
body, while giving us the benefit of the familiarity and insight
into our affairs that our directors have accumulated during their
tenure. With the addition of five new directors in 2017, the
board’s composition has
been refreshed to bring the most relevant skill sets and
experiences to the board at this time. When analyzing whether
directors and nominees have the desired experience, qualifications,
attributes and skills, individually and taken as a whole, the
nominating and governance committee and the board of directors
focus on the information as summarized in each of the
directors’ individual
biographies set forth below. In particular, the board selected Mr.
Cerminara to serve as a director because of his extensive
experience in the financial industry, including investing, capital
allocation, finance and financial analysis of public companies, and
operational experience as the Chief Executive Officer of a
publicly-traded company. He also brings the perspective of one of
our most significant stockholders. Mr. Dill brings over 20 years of
extensive leadership and operational experience to the board,
including experience in developing and implementing strategic
plans. Mr. Johnson brings to the board the perspective of one of
the Company’s most
significant stockholders. He has extensive experience in the
financial industry, including investing, capital allocation,
finance and financial analysis of public companies. Mr. Lanktree
brings extensive operational and leadership experience, wireless
communications industry experience and public company experience to
the board, including experience as a Chief Executive Officer.
General Payne brings extensive strategic, operational and
leadership experience and valuable insight into the military
sector, having over 40 years of military operational and strategic
expertise. Mr. Struble provides extensive experience in the
accounting/finance field to the board and qualifies as an
“audit committee
financial expert” under
the SEC’s rules. Mr.
Turner brings extensive experience in investment analysis and
capital allocation for a publicly-traded company, as well as
business development experience.
Vote Required
The
affirmative vote of a plurality of the votes cast, either in person
or by proxy, at the annual meeting is required for the election of
these nominees as directors.
Recommendation of the Board
Our
board of directors unanimously recommends that stockholders vote
“FOR” the election of the seven nominees
named in this proxy statement as directors.
Nominees for Election as Directors
The
following table sets forth the nominees to be elected at the annual
meeting, the year each nominee was first elected as a director,
each nominee’s age and
the positions currently held by each nominee with our
company:
Name and Year First Elected
|
|
Age
|
|
Position
|
D. Kyle
Cerminara (2015)(1)(2)
|
|
40
|
|
Chairman
of the Board
|
Michael
R. Dill (2017)(1)(3)
|
|
53
|
|
Director
|
Lewis
M. Johnson (2016)(2)
|
|
48
|
|
Director
|
Charles
T. Lanktree (2017)(1)
|
|
68
|
|
Director
|
General
E. Gray Payne (2017)(1)(2)(3)
|
|
70
|
|
Director
|
John W.
Struble (2017)(3)
|
|
41
|
|
Director
|
Ryan
R.K. Turner (2017)(1)
|
|
39
|
|
Director
|
_____________
(1)
|
Member
of the compensation committee.
|
(2)
|
Member
of the nominating and governance committee.
|
(3)
|
Member
of the audit committee.
|
|
|
The
business experience of each nominee for director is set forth below
as of April 16, 2018.
D. Kyle Cerminara was appointed to the board of directors in
July 2015 and as Chairman in March 2017. Mr. Cerminara is the Chief
Executive Officer and Chairman of the Board for Ballantyne Strong,
Inc., a holding company with diverse business activities focused on
serving the cinema, retail, financial and government markets. Mr.
Cerminara assumed responsibilities as Chairman of the Board of
Ballantyne Strong in May 2015 and as Chief Executive Officer in
November 2015. Since April 2012, Mr. Cerminara has also served as
the Chief Executive Officer, Co-Founder and Partner of Fundamental
Global Investors, LLC, an SEC registered investment advisor that
manages equity and fixed income hedge funds and is the largest
stockholder of the Company. In addition, Mr. Cerminara is Co-Chief
Investment Officer of CWA Asset Management Group, LLC (d/b/a
Capital Wealth Advisors), a wealth advisor and multi-family office
affiliated with Fundamental Global Investors, LLC, which position
he has held since December 2012. Mr. Cerminara also serves as
President and Trustee of StrongVest ETF Trust and Chief Executive
Officer of StrongVest Global Advisors, LLC. StrongVest Global
Advisors, LLC, a wholly-owned subsidiary of Ballantyne Strong, is
an investment advisor, and CWA Asset Management Group, LLC is a
sub-advisor, to CWA Income ETF, an exchange-traded fund and series
of StrongVest ETF Trust. Mr. Cerminara is a member of the Board of
Directors of a number of publicly held companies focused in the
insurance, technology and communications sectors, including
Ballantyne Strong, Inc. (NYSE American: BTN) since February 2015,
1347 Property Insurance Holdings, Inc. (Nasdaq: PIH), a holding
company, which, through its subsidiaries, is engaged in providing
property and casualty insurance, since December 2016, and Itasca
Capital, Ltd. (TSXV: ICL) (formerly Kobex Capital Corp.), a
publicly traded investment firm, since June 2016. He also served on
the Board of Directors of Iteris, Inc. (Nasdaq: ITI), a publicly
traded applied informatics company, from August 2016 to November
2017, and Magnetek, Inc., a publicly traded manufacturer, in 2015.
Prior to these roles, Mr. Cerminara was a Portfolio Manager at
Sigma Capital Management, an independent financial adviser, from
2011 to 2012, a Director and Sector Head of the Financials Industry
at Highside Capital Management from 2009 to 2011, and a Portfolio
Manager and Director at CR Intrinsic Investors from 2007 to 2009.
Before joining CR Intrinsic Investors, Mr. Cerminara was a Vice
President, Associate Portfolio Manager and Analyst at T. Rowe Price
from 2001 to 2007 and an Analyst at Legg Mason from 2000 to 2001.
Mr. Cerminara received an MBA from the Darden School of Business at
the University of Virginia and a B.S. in Finance and Accounting
from the Smith School of Business at the University of Maryland,
where he was a member of Omicron Delta Kappa, an NCAA Academic All
American and Co-Captain of the men’s varsity tennis team. He also
completed a China Executive Residency at the Cheung Kong Graduate
School of Business in Beijing, China. Mr. Cerminara holds the
Chartered Financial Analyst (CFA) designation.
Michael R. Dill was appointed to the board of directors in
March 2017. Mr. Dill has served as President of the Aerospace,
Power Generation and General Industrial divisions at AFGlobal
Corporation, a privatelyheld, integrated technology and
manufacturing company, since 2014. Prior to joining AFGlobal, Mr.
Dill held various positions in the Aerospace and Defense division
of CIRCOR International, a publicly traded global manufacturer of
highly engineered environment products (NYSE: CIR), including
serving as Group Vice President from 2009 to 2014, Vice President
of Business Development and Strategy from 2010 to 2011 and Director
of Continuous Improvement from 2009 to 2011. From 2007 to 2009, he
served as a Business Unit Director and Facility Leader within the
aerospace group of Parker Hannifin Corporation (NYSE: PH), a
publicly traded diversified manufacturer of motion and control
technologies and systems. Before joining Parker Hannifin
Corporation, he held various positions with Shaw Aero Devices,
Inc., a producer of aerospace components and equipment, from 1996
to 2007, and Milliken and Company, a manufacturing company, from
1988 to 1996. Mr. Dill received a B.S. in Management from the
Georgia Institute of Technology.
Lewis M. Johnson was elected to the board of directors in
May 2016. Since April 2012, Mr. Johnson has served as the
President, Co-Founder and Partner of Fundamental Global Investors,
LLC, an SEC registered investment advisor that manages equity and
fixed income hedge funds and is the largest stockholder of the
Company. In addition, since April 2012, Mr. Johnson has served as
Co-Chief Investment Officer of CWA Asset Management Group, LLC
(d/b/a Capital Wealth Advisors), a wealth advisor and multi-family
office affiliated with Fundamental Global Investors, LLC. Prior to
co-founding Fundamental Global Investors, LLC and partnering with
Capital Wealth Advisors, Mr. Johnson was a private investor from
2010 to 2012. From 2008 to 2010, Mr. Johnson served as Portfolio
Manager and Managing Director at Louis Dreyfus Highbridge Energy.
Previously, Mr. Johnson was a Senior Vice President, Portfolio
Manager and Analyst at Pequot Capital from 2006 to 2007. Prior to
joining Pequot Capital, Mr. Johnson was a Vice President and
Analyst at T. Rowe Price from 2000 to 2006. Mr. Johnson worked as
an Analyst at Capital Research and Management in 1999 and a Vice
President at AYSA from 1992 to 1998. Mr. Johnson received an MBA
from the Wharton School of Business at the University of
Pennsylvania in addition to a MA in Political Science and a BA in
International Studies from Emory University, where he graduated
Magna Cum Laude and was a member of Phi Beta Kappa. Mr. Johnson has
served on the Board of Directors of Ballantyne Strong, Inc. (NYSE
American: BTN), a holding company with diverse business activities
focused on serving the cinema, retail, financial and government
markets, since May 2016 and on the Board of Directors of 1347
Property Insurance Holdings, Inc. (Nasdaq: PIH), a holding company,
which, through its subsidiaries, is engaged in providing property
and casualty insurance, since April 2017.
Charles T. Lanktree was appointed to the board of directors
in March 2017. Mr. Lanktree has served as President and Chief
Executive Officer of Eggland’s Best, LLC, a joint venture between
Eggland’s Best, Inc. and
Land O’Lakes, Inc.
distributing nationally branded eggs, since 2012. Since 1997, Mr.
Lanktree has served as President and Chief Executive Officer of
Eggland’s Best, Inc., a
franchisedriven consumer
egg business, where he previously served as the President and Chief
Operating Officer from 1995 to 1996 and Executive Vice President
and Chief Operating Officer from 1990 to 1994. Mr. Lanktree
currently serves on the Board of Directors of Eggland’s Best, Inc. and several of its
affiliates and on the Board of Directors of Ballantyne Strong, Inc.
(NYSE American: BTN), a holding company with diverse business
activities focused on serving the cinema, retail, financial and
government markets. From 2010 to 2013, he served on the Board of
Directors of Eurofresh Foods, Inc., a privately held company, and
from 2004 to 2013, he was on the Board of Directors of
Nature’s Harmony Foods,
Inc. Prior to joining Eggland’s Best, Inc., Mr. Lanktree served as
the President and Chief Executive Officer of American Mobile
Communications, Inc. from 1987 to 1990 and as the President and
Chief Operating Officer of Precision Target Marketing, Inc. from
1985 to 1987. From 1976 to 1985, he held various
executivelevel marketing
positions with The Grand Union Company and BeechNut Foods Corporation. Mr. Lanktree
received an MBA from the University of Notre Dame and a B.S. in
Food Marketing from St. Joseph’s College. He also served in the
U.S. Army and U.S. Army Reserves from 1971 to 1977.
General E. Gray Payne was appointed to the board of
directors in January 2017. General Payne served as Senior Vice
President of The Columbia Group (“TCG”), since September 2010 to September
2017, where he has been responsible for managing the Marine Corps
Programs Division (since September 2010) and the Navy Programs
Division (since October 2013), with combined annual revenue of
approximately $30 million. TCG is a federal consulting firm working
with the Department of Defense, Department of Homeland Security,
NOAA and private clients. TCG consults in the areas of logistics,
acquisitions, program management, information technology, training,
marine architecture and engineering, and command and control
systems. Since December 2011, General Payne has also provided
consulting services to and served on the Advisory Council of
Marstel-Day, LLC, located in Fredericksburg, Virginia, which
consults in the areas of conservation, environmental compliance,
and encroachment. Prior to September 2010, General Payne was on
active duty with the Marine Corps for 10 years, retiring as a Major
General. Prior to March 2001, he worked with a number of companies
in various capacities, including as a management consultant, Chief
Financial Officer, Chief Operating Officer, and Chief Executive
Officer. General Payne currently serves on the following non-profit
boards: The Marine Corps Association & Foundation (since 2005),
where he serves as Chairman of the Board of The Marine Corps
Association, and VetCV (since December 2017). He received a BS in
Economics from North Carolina State University and a MS in
Strategic Studies from U.S. Army War College.
John W. Struble was appointed to the board of directors in
March 2017. Mr. Struble has served as Chief Financial Officer of
IntraPac International Corporation, a manufacturing company owned
by private equity investment firm Onex Corporation (TSE: ONEX),
since December 2013, where he is responsible for the finance,
information technology and human resources functions. From May 2012
to December 2013, he served as Corporate Controller and Treasurer
of IntraPac. From May 2010 to May 2012, he served as Corporate
Controller (Operations) of Euramax International, Inc., where he
was responsible for the accounting and finance functions for the
North American operations. Euramax is a public company that
produces aluminum, steel, vinyl and fiberglass products for OEM,
distributors, contractors, and home centers in North America and
Europe. Prior to that, he was Controller of RockTenn Company, from December 2008 to
February 2010. Mr. Struble is a Certified Public Accountant. He
received an MBA from the University of Georgia and a B.S. in
Business Administration from the State University of New York at
Buffalo.
Ryan R.K. Turner was appointed to the board of directors in
March 2017. Mr. Turner has served as Vice President of Strategic
Investments for Ballantyne Strong, Inc. (NYSE American: BTN), a
holding company with diverse business activities focused on serving
the cinema, retail, financial and government markets, since 2016.
Mr. Turner also serves as President of StrongVest Global Advisors,
LLC, a wholly-owned subsidiary of Ballantyne Strong. He previously
served as Director of Business Development for Ballantyne Strong,
Inc. from 2015 to 2016. From 2012 to 2015, Mr. Turner served as
Director of Research and Research Analyst for Fundamental Global
Investors, LLC, an SEC registered investment advisor that manages
equity and fixed income hedge funds and, together with Ballantyne
Strong, is the largest stockholder of the Company. Prior to joining
Fundamental Global Investors, LLC, Mr. Turner worked as an
Associate Analyst at T. Rowe Price from 2006 to 2012, and as an
Associate in the Product Services & Development Department at
AST Trust Company from 2002 to 2006. Mr. Turner received an MBA
from the Robert H. Smith School of Business at the University of
Maryland and a B.S. in Business Administration from the University
of Arizona. Mr. Turner holds the Chartered Financial Analyst (CFA)
designation.
Executive Officers
The
following table presents information with respect to our executive
officers as of April 16, 2018.
Name
|
|
Age
|
|
Position
|
Timothy
A. Vitou
|
|
61
|
|
President
|
William
P. Kelly
|
|
61
|
|
Executive
Vice President, Chief Financial Officer and Secretary
|
Randy
Willis
|
|
59
|
|
Chief
Operating Officer
|
James
R. Holthaus
|
|
55
|
|
Chief
Technology Officer
|
Timothy A. Vitou has been our President since January 17,
2017. He previously served as the Company’s Senior Vice President of Sales and
Marketing since May 2008. Prior to that, he served as Vice
President of Sales for Mobility Electronics, Inc., from August 2006
to May 2007, Senior Director of Global Go-To-Market, for Motorola
Solutions, Inc., from April 2002 to April 2006, and General
Manager, Americas Region, for Motorola Solutions, from April 2000
to April 2002.
William P. Kelly has been our
Executive Vice President and Chief Financial Officer since July
1997, and Secretary since June 2000. From October 1995 to June
1997, he was Vice President and Chief Financial Officer of our
subsidiary, RELM Communications, Inc. From January 1993 to October
1995, he was the Financial Director of Harris Corp. Semiconductor
Sector.
Randy Willis has been our Chief
Operating Officer since March 14, 2018. He previously served as the
Company’s Vice President of Operations since August 2017,
overseeing all aspects of manufacturing and quality. Prior to
joining the Company, he held leadership positions in manufacturing,
operations, quality, supply chain, industrial engineering and
program management, including founding and serving as President of
Target Velocity Consulting, Inc., a “Lean/Six Sigma”
firm specializing in operational improvements, from December 2009
to August 2017 and Vice President, Continuous Improvement, for
CIRCOR International, Inc. (NYSE: CIR), from August 2007 to
December 2009. He also served in leadership positions for
Parker-Hannifin Corporation (NYSE: PH) from January 2005 to August
2007 and Honeywell International Inc. (NYSE: HON) from June 1998 to
January 2005. Mr. Willis holds certifications as a Lean Master and
Six Sigma Black Belt and B.S. and M.S. degrees in Industrial
Technology from East Carolina University.
James R. Holthaus was appointed as our Chief Technology Officer
effective August 4, 2017. He joined the Company in 2007 and most
recently served as the Vice President – Project 25 Solutions,
responsible for product definition and market analysis with a focus
on development of our P25 mobile and portable radio products. Since
1993, Mr. Holthaus has been active in the development of land
mobile radio products and the P25 Digital Radio Standards. He holds
an M.S. Degree in Electrical Engineering from Southern Methodist
University.
The
board of directors is committed to good business practices,
transparency in financial reporting and the highest level of
corporate governance. The board of directors, which is elected by
the stockholders, is our ultimate decision-making body except with
respect to those matters reserved to our stockholders. It selects
the senior management team, which is charged with the conduct of
our business. Having selected the senior management team, the board
of directors acts as an advisor and counselor to senior management
and ultimately monitors its performance.
Board of Directors Independence
In
accordance with the NYSE American corporate governance listing
standards, it is our policy that the board of directors consist of
a majority of independent directors. Our board of directors reviews
the relationships that each director has with us and other parties.
Only those directors who do not have any of the categorical
relationships that preclude them from being independent within the
independence requirements of the NYSE American corporate governance
listing standards and who the board of directors affirmatively
determines have no relationships that would interfere with the
exercise of independent judgment in carrying out the
responsibilities of a director are considered to be independent
directors. The board of directors has reviewed a number of factors
to evaluate the independence of each of its members. These factors
include its members’
current and historic relationships with us and our subsidiaries;
their relationships with management and other directors; the
relationships their current and former employers have with us and
our subsidiaries; and the relationships between us and other
companies of which our board members are directors or executive
officers. After evaluating these factors, the board of directors
has determined that all seven members are “independent” directors within the independence
requirements of the NYSE American corporate governance listing
standards and all applicable rules and regulations of the
SEC.
There
are no family relationships between any of our directors, director
nominees or executive officers.
Independent members
of our board of directors meet in executive session without
management present, and are scheduled to do so at least once per
year. The board of directors has designated Mr. Cerminara as the
presiding director for these meetings.
Stockholder Communications
Our
board of directors believes that it is important for our
stockholders and other interested parties to have a process to send
communications to the board. Accordingly, stockholders and other
interested parties desiring to send a communication to the board of
directors or to a specific director may do so by delivering a
letter to the Corporate Secretary of RELM at 7100 Technology Drive,
West Melbourne, Florida 32904. The mailing envelope must contain a
clear notation indicating that the enclosed letter is a
“stockholder-board
communication” or
“stockholder-director
communication” (or
“interested party-board
communication” or
“interested
party-director communication,” as appropriate). All such letters
must identify the author as the stockholder or interested party and
clearly state whether the intended recipients of the letter are all
members of our board of directors or certain specified individual
directors. The secretary will open such communications and make
copies, and then circulate them to the appropriate director or
directors and such other individuals in accordance with our
corporate governance policies.
Policy Concerning Director Attendance at Annual Stockholders’
Meetings
While
we encourage all members of our board of directors to attend our
annual stockholders’
meetings, there is no formal policy as to their attendance at
annual stockholders’
meetings. All seven members of our board of directors attended the
2017 annual stockholders’
meeting.
Codes of Ethics
Our
board of directors has adopted the Code of Business Conduct and
Ethics (the “Code of
Conduct”) that applies to
all of our directors, officers and employees, including our
principal executive officer, principal financial officer and
principal accounting officer, and the Code of Ethics for the CEO
and Senior Financial Officers (the “Code of Ethics”) containing additional specific
policies. The Code of Conduct and the Code of Ethics are posted on
our Internet website at
www.bktechnologies.com/resources/code-of-ethics and are available
free of charge, upon request to Corporate Secretary, 7100
Technology Drive, West Melbourne, Florida 32904; telephone number:
(321) 984-1414.
Any
amendment to, or waiver from, the codes applicable to our directors
and executive officers will be disclosed in a current report on
Form 8-K within four business days following the date of the
amendment or waiver unless the rules of the NYSE American then
permit website posting of such amendments and waivers, in which
case we would post such disclosures on our Internet
website.
Meetings and Committees of the Board of Directors
The
board of directors held eight meetings during 2017, and each of the
directors attended at least seventy-five percent (75%) of the total
number of meetings of the board of directors held during the period
for which he was a director and the total number of meetings held
by all committees of the board of directors on which he served
during the periods that he was a member of that
committee.
The
board of directors has a standing audit committee, compensation
committee and nominating and governance committee.
Audit
Committee. The
members of the audit committee are John W. Struble, who serves as
chairperson, Michael R. Dill and General E. Gray Payne. The audit
committee has a written charter, which is available at our website
at www.bktechnologies.com/resources/corporate-governance. The audit
committee charter requires that the audit committee consist of two
or more members of the board of directors, each of whom are
independent as defined by the corporate governance listing
standards of the NYSE American.
The
board of directors has determined that each of the members of the
audit committee is independent, as defined by Rule 10A-3 of the
Exchange Act and the corporate governance listing standards of the
NYSE American. The board of directors also has determined that Mr.
Struble is an “audit
committee financial expert,” as defined in Item 407(d)(5) of
Regulation S-K.
The
audit committee has oversight responsibility for the quality and
integrity of our consolidated financial statements and is directly
responsible for the appointment, compensation, retention and
oversight of our independent registered public accounting firm. The
committee meets privately with members of our independent
registered public accounting firm, which has unrestricted access
and reports directly to the committee, and annually reviews their
performance and independence from management in deciding whether to
continue to retain the accounting firm or engage a different
accounting firm. The audit committee also evaluates the lead
partner designated by the independent auditor. As required by the
SEC’s rules, the
committee is directly involved in the review and selection of the
audit partners serving on the auditor’s engagement team during mandated
five-year partner rotations. The audit committee also oversees
audit fee negotiations associated with our retention of the
independent auditor and has the sole authority to approve such
fees. The audit committee met five times during 2017. The primary
functions of the audit committee are to oversee: (i) the audit of
our consolidated financial statements provided to the SEC and our
stockholders; (ii) our internal financial and accounting processes;
and (iii) the independent audit process. Additionally, the audit
committee has responsibilities and authority necessary to comply
with Rules 10A-3(b) (2), (3), (4), and (5) of the Exchange Act,
concerning the responsibilities relating to: (a) registered public
accounting firms, (b) complaints relating to accounting, internal
accounting controls or auditing matters, (c) authority to engage
advisors and (d) funding. These and other aspects of the audit
committee’s authority are
more particularly described in the audit committee
charter.
The
audit committee has adopted a formal policy concerning approval of
audit and non-audit services to be provided to us by our
independent registered public accounting firm, Moore Stephens
Lovelace. The policy requires that all services to be provided by
Moore Stephens Lovelace, including audit services and permitted
audit-related and non-audit services, must be pre-approved by the
audit committee. The audit committee approved all audit services
provided by Moore Stephens Lovelace to us during 2017. Moore
Stephens Lovelace did not provide any audit-related or non-audit
services to us during 2017.
Compensation
Committee. The members of the
compensation committee are D. Kyle Cerminara, who serves as
chairperson, Michael R. Dill, Charles T. Lanktree, General E. Gray
Payne and Ryan R.K. Turner. All members of the compensation
committee are independent under the corporate governance listing
standards of the NYSE American and applicable SEC rules and
regulations. The compensation committee has a written charter,
which is available at our website at
www.bktechnologies.com/resources/corporate-governance. The
functions performed by the compensation committee include reviewing
and approving all compensation arrangements for our executive
officers and administering our equity incentive plans and programs.
The compensation committee makes all final compensation decisions
for the named executive officers (as identified in the “Summary Compensation Table for
2016-2017” appearing in
this proxy statement, the “Named Executive Officers”), including grants of stock
options. Our principal executive officer annually reviews the
performance of each of the Named Executive Officers and other
officers, and makes recommendations regarding the Named Executive
Officers and other officers and managers of the company, while the
compensation committee reviews the performance of our principal
executive officer. The conclusions and recommendations resulting
from our principal executive officer’s review are then presented to the
compensation committee for its consideration and approval. The
compensation committee can exercise its discretion in modifying any
of our principal executive officer’s recommendations. In performing its
functions, the compensation committee may retain and terminate
outside counsel, compensation and benefits consultants or other
experts. During 2017, the compensation committee met two
times.
Nominating
and Governance Committee. The members of the
nominating and governance committee are D. Kyle Cerminara, who
serves as chairperson, Lewis M. Johnson and General E. Gray Payne.
All members of the nominating and governance committee are
independent under the corporate governance listing standards of the
NYSE American. The nominating and governance committee has a
written charter, which is available at our website at
www.bktechnologies.com/resources/corporate-governance. During 2017,
the nominating and governance committee met once.
The
functions of the nominating and governance committee include
determining and recommending to the board of directors the slate of
director nominees for election to the board of directors at each
annual stockholders’
meeting and identifying and recommending director candidates to
fill vacancies occurring between annual stockholders’ meetings. In addition, the
nominating and governance committee reviews, evaluates and
recommends changes to our corporate governance guidelines and
policies, including our Code of Conduct and Code of Ethics, and
monitors our compliance with these corporate governance guidelines,
policies and codes.
Board Leadership and Board’s Role in Risk
Oversight
We have
a separate Chairman of the Board and Principal Executive Officer.
Our board of directors believes this board leadership structure is
best for the Company and our stockholders at this time. Our current
Chairman of the Board is D. Kyle Cerminara, an independent
director, and our current Principal Executive Officer is our
President, Timothy A. Vitou.
The
board believes it is in the Company’s best interest to have a separate
Chairman of the Board and Principal Executive Officer so that the
Principal Executive Officer can devote his time and energy on the
day-to-day management of the business while our independent
Chairman, currently Mr. Cerminara, can focus on providing advice
and independent oversight of management. Because our Chairman is
appointed annually by our non-management directors, such directors
are able to evaluate the leadership, performance and independence
of our Chairman each year.
Our
board of directors, through its three standing committees, has an
advisory role in the Company’s risk management process. In
particular, the board is responsible for monitoring and assessing
strategic and operational risk exposure. Our management team
maintains primary responsibility for the Company’s risk management, and the board and
its committees rely on the representations of management, the
external audit of our financial and operating results, our systems
of internal controls and our historically conservative practices
when assessing the Company’s risks. The audit committee
considers and discusses financial risk exposures and the steps
management has taken to monitor and control these exposures, and
also provides oversight of the performance of the internal audit
function. The nominating and governance committee monitors the
effectiveness of our corporate governance policies and the
selection of prospective board members and their qualifications.
The compensation committee, in conjunction with the audit
committee, assesses and monitors whether any of the
Company’s compensation
policies and programs have the potential to encourage excessive
risk-taking. Each committee must report findings regarding material
risk exposures to the board as quickly as possible. The board
believes that its role in risk oversight does not affect the
board’s leadership
structure.
Director Nomination Process
In
accordance with the nominating and governance committee’s written charter, the nominating
and governance committee has established policies and procedures
for the nomination of director candidates to the board of
directors. The nominating and governance committee determines the
required selection criteria and qualifications of director
candidates based upon our needs at the time director candidates are
considered. Minimum qualifications for director candidates are set
forth in the committee’s
“Policy Regarding Minimum
Qualifications of Director Candidates” and include threshold criteria such
as integrity, absence of conflicts of interest that would
materially impair a director’s ability to exercise independent
judgment or otherwise discharge the fiduciary duties owed as a
director to the company and our stockholders, ability to represent
fairly and equally all stockholders, demonstrated achievement in
one or more fields of business, professional, governmental,
communal, scientific or educational endeavors, sound judgment, as a
result of management or policy-making experience, that demonstrates
an ability to function effectively in an oversight role, general
appreciation regarding major issues facing public companies of a
size and operational scope similar to the company, and adequate
time to serve. As noted in the policy, the committee, as one of its
considerations, considers the extent to which the membership of the
candidate on the board will promote diversity among the directors,
and seeks to promote through the nominations process an appropriate
diversity on the board of professional background, experience,
expertise, perspective, age, gender, ethnicity and country of
citizenship. The committee also considers the overall composition
of the board and its committee, compliance with the NYSE American
listing standards, and the contributions that a candidate can be
expected to make to the collective functioning of the board based
upon the totality of the candidate’s credentials, experience and
expertise, the composition of the board at the time, and other
relevant circumstances.
We are
of the view that the continuing service of qualified incumbent
directors promotes stability and continuity in the function of the
board of directors, contributing to the board’s ability to work as a collective
body, while giving us the benefit of the familiarity and insight
into our affairs that our directors have accumulated during their
tenure.
The
nominating and governance committee has adopted procedures
consistent with the practice of re-nominating incumbent directors
who continue to satisfy the committee’s criteria for membership on the
board, whom the committee believes continue to make important
contributions to the board and who consent to continue their
service on the board. These procedures are set forth in the
committee’s “Procedures for Identifying and
Evaluating Director Candidates” policy. When evaluating the
qualifications and performance of the incumbent directors that
desire to continue their service on our board, the committee will
(i) consider whether the director continues to satisfy the minimum
qualifications for director candidates adopted by the committee,
(ii) review the assessments of the performance of the director
during the preceding term made by the committee, and (iii)
determine whether there exist any special, countervailing
considerations against re-nomination of the director. When there is
no qualified and available incumbent, the committee will also
solicit recommendations for nominees from persons that the
committee believes are likely to be familiar with qualified
candidates. These persons may include members of our board of
directors and management of the Company. The committee may also
determine to engage a professional search firm to assist in
identifying candidates. As to each recommended candidate that the
committee believes merits consideration, the committee will
consider, among other things, whether the candidate possesses any
of the specific qualities or skills that under the
committee’s policies must
be possessed by one or more members of the board, the contribution
that the candidate can be expected to make to the overall
functioning of the board and the extent to which the membership of
the candidate on the board will promote diversity among the
directors.
The
nominating and governance committee has adopted a policy with
regard to the consideration of director candidates submitted by
stockholders. This policy is set forth in the committee’s “Policy Regarding Director Candidate
Recommendations Submitted by Stockholders.” The committee will only consider
director candidates submitted by stockholders who satisfy the
minimum qualifications prescribed by the committee, including that
a director must represent the interests of all stockholders and not
serve for the purpose of favoring or advancing the interests of any
particular stockholder group or other constituency.
In
accordance with this policy, the nominating and governance
committee will consider director candidates recommended by
stockholders only where the committee has determined to not
re-nominate an incumbent director. In addition, the nominating and
governance committee will not consider any recommendation by a
stockholder or an affiliated group of stockholders unless such
stockholder or group of stockholders has owned at least five
percent (5%) of our common stock for at least one year as of the
date the recommendation is made. Any eligible stockholder (or
affiliated group of stockholders) who desires to recommend a
director candidate for consideration by the nominating and
governance committee for the 2019 annual meeting of stockholders is
required to do so prior to December 21, 2018. Any such eligible
stockholder (or affiliated group of stockholders) is required to
submit complete information about itself and the recommended
director candidate as specified in the committee’s “Procedures for Stockholders
Submitting Director Candidate Recommendations” policy and as set forth in the
advance notice provisions in our amended and restated bylaws. Such
information must include, among other things, (i) the number of our
common shares beneficially owned by the recommending stockholder
and the length of time such shares have been held, (ii) the name,
age and experience of the director candidate, (iii) whether the
director candidate owns any of our securities, (iv) whether the
director candidate has a direct or indirect material interest in
any transaction in which we are a participant, (v) a description of
all relationships between the director candidate and the
recommending stockholder, and (vi) a statement setting forth the
director candidate’s
qualifications. Submissions should be addressed to the nominating
and governance committee care of our Corporate Secretary at our
principal headquarters, 7100 Technology Drive, West Melbourne,
Florida 32904. Submissions must be made by mail, courier or
personal delivery. E-mail submissions will not be
considered.
Copies
of the policies of the nominating and corporate governance
committee are available on our website at
www.bktechnologies.com/resources/policies-and-procedures.
The nominating and governance committee evaluated Messrs. D. Kyle
Cerminara, Michael R. Dill, Lewis M. Johnson, Charles T. Lanktree,
General E. Gray Payne, John W. Struble and Ryan R.K. Turner, all of
whom are incumbent directors, and recommended their nomination to
the board of directors. The board, in turn, nominated these seven
persons for election as directors at the annual
meeting.
DIRECTOR COMPENSATION FOR
2017
Director Compensation Program
Effective
March 17, 2017, the board, upon the recommendation of the
compensation committee, adopted a new director compensation program
for all non-employee directors. The new director compensation
program eliminates meeting fees and increases the annual retainer
fee paid to non-employee directors. The program was adopted to
remain competitive in attracting and retaining qualified board
members and to better align director compensation to other public
companies of comparable size to the Company.
Under
the new program, each non-employee director receives an annual
retainer fee of $50,000, of which $30,000 is payable in quarterly
cash payments of $7,500 and $20,000 is payable in the form of an
annual grant of restricted stock units pursuant to the 2017
Incentive Compensation Plan. The restricted stock units are granted
at the board meeting coinciding with the Company’s annual
stockholders meeting and each restricted stock unit represents a
contingent right to receive one share of the Company’s common
stock. The restricted stock units vest in full 12 months after the
grant date, subject to the recipient’s continued service as a
director of the Company through such date.
In addition, the new director compensation program
provides for an additional $3,000 payable in cash each year for
each board committee served on, or an additional $10,000 payable in
cash each year per committee for service as committee chairman. The
Chairman of the Board also receives an additional $10,000 annual
retainer fee payable in cash. All non-employee directors are
entitled to reimbursement of reasonable expenses incurred by them
in connection with their attendance at meetings of the board and
any committee thereof on which they serve or otherwise in
furtherance of our business. If a
non-employee director does not serve on the board or a board
committee or as Chairman of the Board or a board committee chairman
for the full year, the board and any applicable board committee or
chairman retainers are prorated for the portion of the year
served.
Our
2017 Incentive Compensation Plan provides that the aggregate grant
date fair value of all awards granted to any single non-employee
director during any single calendar year (determined as of the
applicable grant date(s) under applicable financial accounting
rules), taken together with any cash fees paid to the non-employee
director during the same calendar year, may not exceed
$200,000.
Prior
to March 17, 2017, we paid to our non-employee directors meeting
fees of $1,000 for attendance in person and $500 for attendance by
telephone at each board meeting. We also paid to each of our
non-employee directors, who served on any committee of the board,
meeting fees of $250 for attendance at each meeting of any such
committee which was held in conjunction with a meeting of the board
and meeting fees of $500 for attendance at each meeting of any such
committee which was not held in conjunction with a board meeting.
Each of our non-employee directors who served as chairperson of any
committee of the board of directors also received an annual fee of
$1,000. In addition, our non-employee directors received an annual
retainer fee of $8,000, and the Chairman of the Board received an
annual retainer fee of $25,000. All non-employee directors were
also entitled to reimbursement of reasonable expenses incurred by
them in connection with their attendance at meetings of the board
and any committee thereof on which they served or otherwise in
furtherance of our business.
The
following table shows the compensation paid to our non-employee
directors for fiscal 2017. David P. Storey, who resigned as a
director of the Company effective as of the close of business on
January 16, 2017, did not receive any compensation for his service
as a director as he was also the President and Chief Executive
Officer of the Company.
Name
|
Fees Earned or Paid in Cash ($)
|
|
|
|
D. Kyle
Cerminara(1)(8)
|
49,000
|
20,000
|
—
|
69,000
|
Michael R.
Dill(2)(8)
|
27,000
|
20,000
|
—
|
47,000
|
Lewis M.
Johnson(8)
|
28,750
|
20,000
|
—
|
48,750
|
Charles T.
Lanktree(2)(8)
|
24,750
|
20,000
|
—
|
44,750
|
General E. Gray
Payne(3)(8)
|
32,250
|
20,000
|
5,225
|
57,475
|
John W.
Struble(2)
(8)
|
30,000
|
20,000
|
—
|
50,000
|
Ryan R.K.
Turner(2)(8)
|
24,750
|
20,000
|
—
|
44,750
|
Donald F. U.
Goebert(4)
|
—
|
—
|
—
|
—
|
Timothy W.
O’Neil(5)
|
—
|
—
|
—
|
—
|
_________________
(1)
|
Mr.
Cerminara was appointed as Chairman of the Board on March 17, 2017
and re-elected as director at the 2017 annual stockholders’
meeting.
|
|
|
(2)
|
Messrs.
Dill, Lanktree, Struble and Turner were each appointed to the board
on March 17, 2017 and elected by stockholders at the 2017 annual
stockholders’ meeting.
|
(3)
|
General
Payne was appointed to the board on January 9, 2017 and re-elected
as director at the 2017 annual stockholders’
meeting.
|
|
|
(4)
|
Mr.
Goebert resigned as a director on January 9, 2017 and did not
receive any compensation for his services as a director through
such date.
|
|
|
(5)
|
Mr.
O’Neil resigned as a
director on March 16, 2017 and did not receive any compensation for
his services as a director through such date.
|
|
|
(6)
|
Stock
awards represent the aggregate grant date fair value of 5,479
restricted stock units, or RSUs, granted on June 15, 2017 after the
2017 annual stockholders’ meeting to each of our non-employee
directors who was elected as a director at the meeting. The RSUs
were granted pursuant to the 2017 Incentive Compensation Plan and
represent a portion of the annual retainer fee payable to our
non-employee directors as described above under “Director
Compensation Program.” Each RSU represents a contingent right
to receive one share of our common stock. The RSUs vest in full 12
months after the grant date, subject to the director’s
continued service as a director of the Company through such date.
In addition, the 2017 Incentive Compensation Plan grants the
compensation committee the discretion to accelerate vesting of the
RSUs upon the occurrence of a “change in control” (as
defined under the plan) or in connection with the termination of
the director’s service for any reason prior to the vesting
date. The amounts shown represent the aggregate grant date fair
value computed in accordance with Financial Accounting Standards
Board (FASB) Accounting Standards Codification (ASC) Topic 718
“Compensation-Stock Compensation” (“FASB ASC
Topic 718”). For a discussion of valuation assumptions, see
Note 10 (Share-Based Employee Compensation) of our consolidated
financial statements included in our Annual Report on Form 10-K for
fiscal 2017.
|
(7)
|
On
January 9, 2017, General Payne received a stock option grant to
purchase 5,000 shares of our common stock at an exercise price of
$4.95 in connection with his appointment to the board. The options
vested in full on December 10, 2017. The grant was made pursuant to
the terms of our 2007 Incentive Compensation Plan. The amount shown
represents the aggregate grant date fair value computed in
accordance with FASB ASC Topic 718. The value ultimately realized
by General Payne upon the actual exercise of the stock options may
or may not be equal to the FASB ASC Topic 718 computed value. For a
discussion of valuation assumptions, see Note 10 (Share-Based
Employee Compensation) of our consolidated financial statements
included in our Annual Report on Form 10-K for fiscal
2017.
|
(8)
|
The
aggregate number of option and stock awards outstanding (including
exercised and unexercised stock options and unvested RSUs) as of
December 31, 2017 for each non-employee director was as
follows:
|
Name
|
|
Option Awards (#)
|
|
Stock Awards (#)
|
|
D. Kyle Cerminara
|
|
10,000 (all exercisable)
|
|
5,479 RSUs
|
|
Michael
R. Dill
|
|
—
|
|
5,479 RSUs
|
|
Lewis M. Johnson
|
|
5,000 (all exercisable)
|
|
5,479 RSUs
|
|
Charles
T. Lanktree
|
|
—
|
|
5,479 RSUs
|
|
General
E. Payne
|
|
5,000 (all exercisable)
|
|
5,479 RSUs
|
|
John W.
Struble
|
|
—
|
|
5,479 RSUs
|
|
Ryan
R.K. Turner
|
|
—
|
|
5,479 RSUs
|
|
The
restricted stock units vest in full on June 15, 2018, subject to
the director’s continued service as a director of the Company
through such date. See footnote 6 above for more
information.
Messrs.
O’Neil and Goebert did not have any awards outstanding as of
December 31, 2017.
REPORT OF THE AUDIT
COMMITTEE
The
following report of the audit committee does not constitute
soliciting material and should not be deemed filed with the
Securities and Exchange Commission nor shall this report be
incorporated by reference into any of our filings under the
Securities Act of 1933 or the Securities Exchange Act of
1934.
The
audit committee oversees our financial reporting process on behalf
of the board of directors. Management has the primary
responsibility for the consolidated financial statements and the
reporting process, including the systems of internal controls. In
fulfilling its oversight responsibilities, the audit committee has
reviewed and discussed the audited consolidated financial
statements included in our Annual Report on Form 10-K for the
fiscal year ended December 31, 2017 with management, including a
discussion of the quality, not just the acceptability, of the
accounting principles, the reasonableness of significant judgments,
and the clarity of disclosures in the consolidated financial
statements.
The
audit committee also has reviewed and discussed with our
independent registered public accounting firm, Moore Stephens
Lovelace, P.A., which is responsible for expressing an opinion on
the conformity of those consolidated financial statements with
accounting principles generally accepted in the United States, its
judgments as to the quality, not just the acceptability, of our
accounting principles and such other matters as are required to be
discussed with the committee by the Statement on Auditing Standards
No. 1301, Communications with Audit
Committees, as adopted by the Public Company Accounting
Oversight Board. In addition, the audit committee has received the
written disclosures and the letter from Moore Stephens Lovelace,
P.A. required by the applicable requirements of the Public Company
Accounting Oversight Board regarding the independent
accountant’s
communications with the audit committee concerning independence,
and has discussed with Moore Stephens Lovelace, P.A. its
independence.
Based
on the considerations and discussions referred to above, the audit
committee recommended to our board of directors (and the board
approved) that the audited consolidated financial statements for
2017 be included in our Annual Report on Form 10-K for the year
ended December 31, 2017, as filed with the Securities and Exchange
Commission.
This
report is provided by the following independent directors, who
comprise the audit committee:
|
John W.
Struble (chairperson)
|
|
Michael
R. Dill
General
E. Gray Payne
|
SUMMARY COMPENSATION TABLE FOR
2016-2017
The
following table provides certain summary information concerning the
compensation of our Named Executive Officers for the last two
completed fiscal years ended December 31, 2017:
Name
and Principal Position (1)
|
|
Year
|
|
Salary
($)
|
|
Bonus ($)(5)
|
|
Stock Awards
($)
|
|
Option Awards
($)(7)
|
|
Non-Equity Incentive Plan
Compensation ($)
|
|
All Other Compensation
($)
|
|
Total
($)
|
Timothy A. Vitou(2)
|
|
2017
|
|
247,461
|
|
50,000
|
|
—
|
|
54,295
|
|
—
|
|
14,878(8)
|
|
366,634
|
President
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
David P. Storey(3)
|
|
2017
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
309,029(9)
|
|
309,029
|
Former President and
Chief Executive Officer
|
|
2016
|
|
299,174
|
|
—
|
|
—
|
|
110,900
|
|
—
|
|
14,971(9)
|
|
425,045
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William P. Kelly
|
|
2017
|
|
201,283
|
|
25,000
|
|
—
|
|
54,295
|
|
—
|
|
14,705(10)
|
|
295,283
|
Executive Vice
President, Chief Financial Officer and Secretary
|
|
2016
|
|
187,012
|
|
115,000
|
|
—
|
|
22,180
|
|
—
|
|
14,709(10)
|
|
338,901
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
James R. Holthaus(4)
|
|
2017
|
|
144,326
|
|
132,556(6)
|
|
—
|
|
56,790
|
|
—
|
|
11,638(11)
|
|
345,310
|
Chief Technology
Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_____________
(1)
Randy Willis was
appointed as Chief Operating Officer of the Company on March 14,
2018, having previously served as Vice President of Operations
since August 2017. Mr. Willis is not included in the table above as
he was not a Named Executive Officer for fiscal 2017.
(2)
Mr. Vitou was
appointed as President of the Company effective January 17, 2017
and was not a Named Executive Officer for fiscal 2016. Mr.
Vitou’s compensation for 2017 includes compensation received
from January 1, 2017 through January 17, 2017 in his role as Senior
Vice President of Sales and Marketing of the Company.
(3)
Mr. Storey resigned
from all positions with the Company effective as of the close of
business on January 16, 2017.
(4)
Mr.
Holthaus was appointed as Chief Technology Officer of the Company
effective August 4, 2017 and was not a Named Executive Officer for
fiscal 2016. Mr. Holthaus’ compensation for 2017 includes
compensation received from January 1, 2017 through August 4, 2017
in his role as Vice President – Project 25 Solutions for the
Company.
(5)
On March 14, 2018,
the compensation committee approved payment of cash bonuses of
$50,000 to Mr. Vitou, $25,000 to Mr. Kelly and $12,500 to Mr.
Holthaus based upon their 2017 performance. On March 17, 2017, the
compensation committee approved payment of a cash bonus of $115,000
to Mr. Kelly based on his 2016 performance. The committee also
approved payment of a cash bonus of $115,000 to Mr. Vitou based on
his 2016 performance. The bonus paid to Mr. Vitou is not shown in
the table above as he was not a Named Executive Officer for fiscal
2016.
(6)
Includes the
$12,500 cash bonus received by Mr. Holthaus on March 14, 2018 (as
described in footnote 4) and the cash bonus received pursuant to a
sales bonus plan related to Mr. Holthaus’ previous position
as Vice President – Project 25 Solutions for the Company. On
August 30, 2017, the compensation committee approved Mr.
Holthaus’ continued participation in the plan through the end
of fiscal 2017.
(7)
The amounts in this
column represent the aggregate grant date fair value of stock
options granted to the Named Executive Officer computed in
accordance with FASB ASC Topic 718. The value ultimately realized
by the Named Executive Officer upon the actual exercise of the
stock options may or may not be equal to the FASB ASC Topic 718
computed value. For a discussion of valuation assumptions, see Note
10 (Share-Based Employee Compensation) of our consolidated
financial statements included in our Annual Report on Form 10-K for
fiscal 2017.
On
February 24, 2016, the compensation committee granted non-qualified
stock options to Messrs. Storey and Kelly to purchase 50,000 shares
and 10,000 shares, respectively, of the Company’s common stock at an exercise price
of $3.83 per share. Mr. Storey forfeited all of these unvested
options upon his resignation from all positions with the Company
effective as of the close of business on January 16, 2017. On March
17, 2017, the compensation committee granted non-qualified stock
options to Messrs. Vitou, Kelly and Holthaus to purchase 25,000,
25,000 and 5,000 shares, respectively, of the Company’s
common stock, at an exercise price of $5.10 per share. In addition,
on August 30, 2017, the compensation committee granted
non-qualified stock options to Messrs. Vitou, Kelly and Holthaus to
purchase 10,000, 10,000 and 25,000 shares, respectively, of the
Company’s common stock, at an exercise price of $4.20 per
share.
Additional
information about the stock option awards can be found under
“—Stock Option
Awards.”
(8)
The amounts in this
column for Mr. Vitou represent our matching contributions for
fiscal 2017 of $6,276 to Mr. Vitou’s account under our 401(k)
plan and our payments for fiscal 2017 of $8,602 for long-term
disability, life and health insurance premiums for the benefit of
Mr. Vitou.
(9)
The amount in this
column for Mr. Storey for fiscal 2017 includes a separation payment
in the gross amount of $300,000, which was paid in equal
installments over a period of 12 months to Mr. Storey pursuant to
the Separation and Release Agreement entered into with the Company
on February 3, 2017, and payments made by the Company to Mr. Storey
for the difference in cost between Mr. Storey’s portion and
COBRA’s actual cost for coverage through December 31, 2017,
which was approximately $9,029 and was paid by the Company pursuant
to the terms of the Separation and Release Agreement. See
“—Separation Agreement with Mr. Storey” for more
information. The amount
in this column for Mr. Storey for fiscal 2016 represents our
matching contributions for fiscal 2016 of $6,031 to Mr.
Storey’ s account under our 401(k) plan and our payment for
fiscal 2016 of $8,940 for long-term disability, life and health
insurance premiums for the benefit of Mr. Storey.
(10)
The amounts in this
column for Mr. Kelly represent our matching contributions for
fiscal 2017 and fiscal 2016 of $6,142 and $5,847, respectively, to
Mr. Kelly’s account under
our 401(k) plan and our payments for fiscal 2017 and fiscal 2016 of
$8,563 and $8,862, respectively, for long-term disability, life and
health insurance premiums for the benefit of Mr.
Kelly.
(11)
The amounts in this
column for Mr. Holthaus represent our matching contributions for
fiscal 2017 of $3,336 to Mr. Holthaus’s account under our
401(k) plan and our payments for fiscal 2017 of $8,302 for
long-term disability, life and health insurance premiums for the
benefit of Mr. Holthaus.
Each of
the Named Executive Officers did not receive any other compensation
during 2017 or 2016 except for perquisites and other personal
benefits of which the total aggregate value for each Named
Executive Officer did not exceed $10,000.
Separation Agreement with Mr. Storey
The board of directors accepted Mr. Storey’s
resignation from all positions held with the Company effective as
of the close of business on January 16, 2017. On February 3, 2017,
the Company and Mr. Storey entered into a Separation and Release
Agreement (the “Separation Agreement”). Pursuant to the
terms of the Separation Agreement, Mr. Storey was entitled to a
separation payment in the gross amount of $300,000, paid in equal
installments over a period of 12 months. Mr. Storey also retained
the right to exercise his vested stock options for a period of
three months following his resignation. His unvested stock options
were forfeited upon his separation of service from the Company. Mr.
Storey’s health insurance benefits provided by the Company
ceased on January 31, 2017, and the Company agreed to pay the
difference in cost between Mr. Storey’s portion and
COBRA’s actual cost for coverage through December 31, 2017,
which totaled approximately $9,029. Mr. Storey’s participation in all benefits
of employment, including but not limited to, accrual of bonuses,
vacation and paid time off, ceased as of January 16,
2017.
The
Separation Agreement also included customary confidentiality,
non-disparagement and non-solicitation covenants and a mutual
release of claims.
Base Salaries
On
March 17, 2017, the compensation committee approved the base
salaries of $250,000 and $200,000 to Messrs. Vitou and Kelly,
respectively.
Effective
August 4, 2017, Mr. Holthaus was appointed as Chief Technology
Officer of the Company. On August 30, 2017, the compensation
committee approved an increase in Mr. Holthaus’s base salary
to a rate of $175,000 per year, effective as of September 1, 2017.
In addition, the committee approved Mr. Holthaus’s continued
participation in a sales bonus plan related to his previous
position as Vice President – Project 25 Solutions of the
Company through the end of fiscal 2017 pursuant to which he
received $120,056.
On
March 14, 2018, the compensation committee approved base salaries
for 2018. The base salaries for Messrs. Vitou and Kelly will remain
at $250,000 and $200,000, respectively, and the base salary for Mr.
Holthaus will increase to $200,000.
Bonus Payments
2017 Discretionary Cash Bonuses
On March 14, 2018, the compensation committee,
upon the recommendation of management, approved the payment of cash
bonuses of $50,000 to Mr. Vitou, $25,000 to Mr. Kelly and
$12,500 to Mr. Holthaus based on their 2017
performance.
2016 Discretionary Cash Bonuses
On
March 17, 2017, the compensation committee, upon the recommendation
of management, approved the payment of cash bonuses of $115,000
each to Messrs. Vitou and Kelly based on their 2016
performance.
Stock Option Awards
2018 Awards
On
March 14, 2018, the compensation committee granted non-qualified
stock options to Messrs. Vitou, Kelly and Holthaus to purchase
30,000, 20,000 and 20,000 shares, respectively, of the
Company’s common stock,
at an exercise price of $3.75 per share. The stock options have
ten-year terms and become exercisable in five annual installments
beginning on the first anniversary of the grant date.
2017 Awards
On
March 17, 2017, the compensation committee granted non-qualified
stock options to Messrs. Vitou, Kelly and Holthaus to purchase
25,000, 25,000 and 5,000 shares, respectively, of the
Company’s common stock,
at an exercise price of $5.10 per share. The stock options have
ten-year terms and become exercisable in five annual installments
beginning on the first anniversary of the grant date.
On
August 30, 2017, the compensation committee granted non-qualified
stock options to Messrs. Vitou, Kelly and Holthaus to purchase
10,000, 10,000 and 25,000 shares, respectively, of the
Company’s common stock, at an exercise price of $4.20 per
share. The stock options have ten-year terms and become exercisable
in five annual installments beginning on the first anniversary of
the grant date.
2016 Awards
On
February 24, 2016, the compensation committee granted non-qualified
stock options to Messrs. Storey and Kelly to purchase 50,000 shares
and 10,000 shares, respectively, of the Company’s common stock, at an exercise price
of $3.83 per share. The stock options have ten-year terms and
become exercisable in five-year annual installments beginning on
the first anniversary of the grant date. Mr. Storey resigned from
all positions with the Company effective as of the close of
business on January 16, 2017. Pursuant to the Separation Agreement
and Release Agreement, Mr. Storey forfeited all of his unvested
options, including all of the non-qualified stock options granted
to him on February 24, 2016, upon his separation of service from
the Company.
Appointment of Chief Operating Officer
On
March 14, 2018, the board of directors appointed Randy Willis as
Chief Operating Officer of the Company effective immediately. Mr.
Willis previously served as Vice President of Operations of the
Company since August 2017. As Chief Operating Officer, Mr. Willis
will receive an annual base salary of $200,000. In addition, the
compensation committee approved for Mr. Willis a $25,000 cash bonus
for 2017 and granted to Mr. Willis non-qualified stock options to
purchase 20,000 shares of the Company’s common stock at an
exercise price of $3.75 per share under the Company’s 2017
Incentive Compensation Plan. The options have a ten-year term and
will become exercisable in one-fifth annual installments, beginning
on the first anniversary of the grant date. Mr. Willis was not a
named Executive Officer for fiscal 2017.
2017 Incentive Compensation Plan
The
Company’s stockholders approved the 2017 Incentive
Compensation Plan (the “2017 Plan”) at the
Company’s 2017 annual meeting of stockholders held on June
15, 2017. The 2017 Plan replaces the Company’s 2007 Incentive
Compensation Plan, which was previously approved by the
stockholders in 2007 (the “2007 Plan”). No new awards
will be granted under the 2007 Plan.
The
objective of the 2017 Plan is to provide incentives to attract and
retain key employees, non-employee directors and consultants and
align their interests with those of the Company’s
stockholders. The 2017 Plan is administered by the Compensation
Committee of the Board of Directors and has a term of ten years.
All non-employee directors of the Company and employees and
consultants of the Company and its subsidiaries designated by the
Compensation Committee are eligible to participate in the 2017 Plan
and to receive awards, including stock options (which may be
incentive stock options or nonqualified stock options), stock
appreciation rights, restricted shares, restricted share units, or
other share-based awards and cash-based awards.
OUTSTANDING EQUITY AWARDS AT
2017 FISCAL YEAR-END
The
following table provides information with respect to outstanding
stock option awards for our shares of common stock classified as
exercisable and unexercisable as of December 31, 2017 for the Named
Executive Officers.
Name
|
Number of Securities Underlying Unexercised
Options (#) Exercisable(7)
|
Number of Securities Underlying Unexercised Options (#)
Unexercisable
|
Option
Exercise Price ($)
|
|
Timothy A.
Vitou
|
15,000(1)
|
—
|
4.07
|
|
|
5,000(2)
|
—
|
2.23
|
|
|
—(3)
|
25,000
|
5.10
|
|
|
—(4)
|
10,000
|
4.20
|
|
|
|
|
|
David P.
Storey
|
—(5)
|
—
|
—
|
—
|
|
|
|
|
|
William P.
Kelly
|
25,000(1)
|
—
|
4.07
|
|
|
15,000(2)
|
—
|
2.23
|
|
|
2,000(6)
|
8,000
|
3.83
|
|
|
—(3)
|
25,000
|
5.10
|
|
|
—(4)
|
10,000
|
4.20
|
|
|
|
|
|
|
James
R. Holthaus
|
—(3)
|
5,000
|
5.10
|
|
|
—(4)
|
25,000
|
4.20
|
|
___________
(1)
|
The
options were granted on March 4, 2010 and are fully vested and
exercisable.
|
|
|
(2)
|
The
options were granted on March 12, 2013 and are fully vested and
exercisable.
|
|
|
(3)
|
The
options were granted on March 17, 2017 and vest in five equal
annual installments beginning on March 17, 2018.
|
(4)
|
The
options were granted on August 30, 2017 and vest in five equal
annual installments beginning on August 30, 2018.
|
|
|
(5)
|
Mr.
Storey resigned from all positions held with the Company effective
as of the close of business on January 16, 2017. Upon his
resignation, Mr. Storey forfeited all 50,000 of his unvested
options. Mr. Storey’s fully vested option remained
exercisable for three months following his resignation. Mr. Storey
exercised the option for all 45,000 shares on March 8,
2017.
|
|
|
(6)
|
The
options were granted on February 24, 2016 and vest in five equal
annual installments beginning on February 24, 2017.
|
(7)
|
On
March 8, 2017, Mr. Storey exercised options to acquire 45,000
shares of the Company’s common stock at an exercise price of
$4.07 per share. The options were granted to Mr. Storey on March 4,
2010, were fully vested and remained exercisable for three months
following his resignation from all positions held with the Company,
which occurred on January 16, 2017. On March 15, 2017, Mr. Vitou
exercised options to acquire 50,000 shares of the Company’s
common stock at an exercise price of $1.75 per share. The options
were granted to Mr. Vitou on May 19, 2008 and became fully
exercisable on May 18, 2011. Messrs. Kelly and Holthaus did not
exercise any options during fiscal 2017.
|
RETIREMENT BENEFITS FOR
2017
We
do not have a defined benefit plan for the Named Executive Officers
or other employees. The only retirement plan available to the Named
Executive Officers in 2017 was our qualified 401(k) retirement
plan, which is available to all employees.
POTENTIAL PAYMENTS UPON TERMINATION IN CONNECTION WITH A CHANGE OF
CONTROL
2016 Change of Control Agreements
Effective as of
February 24, 2016, we entered into change of control agreements
(the “2016 Change of
Control Agreements”) with
the Named Executive Officers (other than Mr. Holthaus) which were
approved by the compensation committee on that same day. The 2016
Change of Control Agreements replaced and terminated the 2012
Change of Control Agreements that we previously entered into with
the Named Executive Officers, which expired on February 29, 2016,
and are substantially similar to the 2012 Change of Control
Agreements.
Mr.
Storey, who served as our President and Chief Executive Officer and
is a Named Executive Officer for fiscal 2017, resigned from all
positions with the Company effective as of the close of business on
January 16, 2017. Accordingly, the discussion below only describes
the terms of the 2016 Change of Control Agreements currently in
effect between the Company and Messrs. Vitou and Kelly. For a
description of the Separation Agreement entered into between the
Company and Mr. Storey, see “Summary Compensation Table for
2016-2017” – Separation Agreement with Mr.
Storey” in this proxy statement.
Each of
the 2016 Change of Control Agreements has a term of four years,
unless a “change of
control” (as defined in
the agreements) of the Company occurs within such four-year period,
in which case each agreement is automatically extended for twelve
months after the date of such change of control. Pursuant to the
2016 Change of Control Agreements, if the applicable Named
Executive Officer’s
employment is terminated within twelve months following a change in
control (i) by the Company for any reason other than for
“cause” (as defined in the agreements),
disability or death or (ii) by such Named Executive Officer for
“good reason” (as defined in the agreements), the
applicable Named Executive Officer will receive certain payments
and benefits. A Named Executive Officer is not entitled to any
payments and benefits if the Named Executive Officer terminates the
Named Executive Officer’s
employment without good reason.
The
payments and benefits to be paid pursuant to the 2016 Change of
Control Agreements are as follows:
●
Mr. Vitou will
receive (i) a cash payment equal to the sum of (x) 50% of his
then-current base salary and (y) the average of his annual cash
bonuses for the two fiscal years preceding the fiscal year in which
termination occurs, (ii) health, life and disability insurance
benefits for himself and, if applicable, his covered dependents for
a period of six months after the date of termination and (iii)
outplacement services for a period of six months following the date
of termination, provided that the costs of such services to the
Company may not exceed $7,500.
●
Mr. Kelly will
receive (i) a cash payment equal to the sum of (x) 75% of his
then-current base salary and (y) the average of his annual cash
bonuses for the two fiscal years preceding the fiscal year in which
termination occurs, (ii) health, life and disability insurance
benefits for himself and, if applicable, his covered dependents for
a period of nine months after the date of termination and (iii)
outplacement services for a period of nine months following the
date of termination, provided that the costs of such services to
the Company may not exceed $11,250.
Under
the 2016 Change of Control Agreements, a change of control will
have occurred if:
●
individuals who, as of February 24, 2016,
constitute the board of directors (the “Incumbent Board”) cease for any reason to constitute at least a
majority of the board, provided that any individual becoming a
director subsequent to that date whose election, or nomination for
election by the company’s stockholders, was approved by a vote of at
least a majority of the directors then comprising the Incumbent
Board (other than an election or nomination of an individual whose
initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the
directors of the company, as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) shall be
considered as though such individual was a member of the Incumbent
Board; or
●
the approval by the
stockholders of the company of a reorganization, merger,
consolidation or other form of corporate transaction or series of
transactions (but not including an underwritten public offering of
the company’s common
stock or other voting securities (or securities convertible into
voting securities of the company) for the company’s own account registered under the
Securities Act of 1933, as amended (the “Securities Act”)), in each case, with respect to
which stockholders of the company immediately prior to such
reorganization, merger, consolidation or other corporate
transaction do not, immediately thereafter, own more than fifty
percent (50%) of the combined voting power entitled to vote
generally in the election of directors of the reorganized, merged
or consolidated entity’s
then outstanding voting securities, or a liquidation or dissolution
of the company or the sale of all or substantially all of the
assets of the company (unless such reorganization, merger,
consolidation or other corporate transaction, liquidation,
dissolution or sale is subsequently abandoned or terminated prior
to being consummated); or
●
the acquisition by
any person, entity or “group”, within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act, of more than fifty
percent (50%) of either the then outstanding shares of the
company’s common stock or
the combined voting power of the company’s then outstanding voting securities
entitled to vote generally in the election of directors
(hereinafter referred to as a “Controlling Interest”) excluding any acquisitions by (x)
the company or any of its subsidiaries, (y) any employee benefit
plan (or related trust) sponsored or maintained by the company or
any of its subsidiaries or (z) any person, entity or “group” that as of February 24, 2016 owns
beneficially (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) a Controlling Interest.
Each of
the 2016 Change of Control Agreements contains term and
post-termination confidentiality, non-solicitation and
non-competition covenants. The post-termination non-solicitation
and non-competition covenants survive six months for Mr. Vitou and
nine months for Mr. Kelly, while the post-term confidentiality
covenants survive indefinitely for each of them.
Except
for the severance agreement entered into with Mr. Storey on
February 3, 2017, we do not have any employment agreements or
severance agreements with any of our Named Executive Officers. In
addition to the 2016 Change of Control Agreements, our equity plans
and award agreements entered into with our Named Executive Officers
include change in control provisions.
2017 Incentive Compensation Plan – Change in Control
Provisions
Our
2017 Incentive Compensation Plan (the “2017 Plan”)
generally provides for “double-trigger” vesting of
equity awards in connection with a change in control of the
Company, as described below.
To the
extent that outstanding awards granted under the 2017 Plan are
assumed in connection with a change in control, then, except as
otherwise provided in the applicable award agreement or in another
written agreement with the participant, all outstanding awards will
continue to vest and become exercisable (as applicable) based on
continued service during the remaining vesting period, with
performance-based awards being converted to service-based awards at
the “target” level. Vesting and exercisability (as
applicable) of awards that are assumed in connection with a change
in control generally would be accelerated in full on a
“double-trigger” basis, if, within two years after the
change in control, the participant’s employment is
involuntarily terminated without cause, or by the participant for
“good reason”. Any stock options or stock appreciation
rights (SARs) that become vested on a “double-trigger”
basis generally would remain exercisable for the full duration of
the term of the applicable award.
To the
extent outstanding awards granted under the 2017 Plan are not
assumed in connection with a change in control, then such awards
generally would become vested in full on a
“single-trigger” basis, effective immediately prior to
the change in control, with performance-based awards becoming
vested at the “target” level. Any stock options or SARs
that become vested on a “single-trigger” basis
generally would remain exercisable for the full duration of the
term of the applicable award.
The
compensation committee has the discretion to determine whether or
not any outstanding awards granted under the 2017 Plan will be
assumed by the resulting entity in connection with a change in
control, and the compensation committee has the authority to make
appropriate adjustments in connection with the assumption of any
awards. The compensation committee also has the right to cancel any
outstanding awards in connection with a change in control, in
exchange for a payment in cash or other property (including shares
of the resulting entity) in an amount equal to the excess of the
fair market value of the shares subject to the award over any
exercise price related to the award, including the right to cancel
any “underwater” stock options and SARs without payment
therefor.
For
purposes of the 2017 Plan, subject to exceptions set forth in the
2017 Plan, a “change in control” generally includes (a)
the acquisition of more than 50% of the company’s common
stock; (b) the incumbent board of directors ceasing to constitute a
majority of the board of directors; (c) a reorganization, merger,
consolidation or similar transaction, or a sale of substantially
all of the Company’s assets; and (d) the complete liquidation
or dissolution of the company. The full definition of “change
in control” is set forth in the 2017 Plan.
Whether
a participant’s employment has been terminated for
“cause” will be determined by the compensation
committee. Unless otherwise provided in the applicable award
agreement or in an another written agreement with the participant,
“cause”, as a reason for termination of a
participant’s employment generally includes (a) the
participant’s failure to perform, in a reasonable manner, his
or her assigned duties; (b) the participant’s violation or
breach of his or her employment agreement, consulting agreement or
other similar agreement; (c) the participant’s violation or
breach of any non-competition, non-solicitation, non-disclosure
and/or other similar agreement; (d) any act of dishonesty or bad
faith by the participant with respect to the Company or a
subsidiary; (e) the participant’s breach of fiduciary duties
owed to the Company; (f) the use of alcohol, drugs or other similar
substances in a manner that adversely affects the
participant’s work performance; or (g) the
participant’s commission of any act, misdemeanor, or crime
reflecting unfavorably upon the participant or the Company or any
subsidiary.
For
purposes of the 2017 Plan, unless otherwise provided in the
applicable award agreement or in an another written agreement with
the participant, “good reason” generally includes (a)
the assignment to the participant of any duties that are
inconsistent in any material respect with his or her duties or
responsibilities as previously assigned by the Company or a
subsidiary, or any other action by the Company or a subsidiary that
results in a material diminution of the participant’s duties
or responsibilities, other than any action that is remedied by the
Company or a subsidiary promptly after receipt of notice from the
participant; or (b) any material failure by the Company or a
subsidiary to comply with its obligations to the participant as
agreed upon, other than an isolated, insubstantial and inadvertent
failure which is remedied by the Company or subsidiary promptly
after receipt of notice from the participant.
Except
as described above with respect to a change in control,
unexercisable stock options generally become forfeited upon
termination of employment. The stock options that are exercisable
at the time of termination of employment expire (a) twelve months
after the termination of employment by reason of death or
disability or (b) three months after the termination of employment
for other reasons.
Our
Named Executive Officers, other employees and directors are
prohibited from hedging or pledging the Company’s securities.
Awards granted under the 2017 Plan also may be subject to
forfeiture or recoupment as provided pursuant to any compensation
recovery (or “clawback”) policy that the Company may
adopt or maintain from time to time.
2007 Incentive Compensation Plan – Change in Control
Provisions
Our
2007 Incentive Compensation Plan (the “2007 Plan”),
under which some equity awards remain outstanding, also contains
provisions providing for the vesting of equity awards in connection
with a change in control of the Company, as described
below.
To the
extent that outstanding awards granted under the 2007 Plan are
assumed in connection with a change in control, then, except as
otherwise provided in the applicable award agreement, all
outstanding awards will continue to vest and become exercisable (as
applicable) based on continued service during the remaining vesting
period.
To the
extent outstanding awards granted under the 2007 Plan are not
assumed in connection with a change in control, then such awards
generally would become vested in full on a
“single-trigger” basis in connection with the change in
control. With respect to any outstanding performance-based awards
subject to achievement of performance goals and conditions, the
compensation committee may, in its discretion, deem such
performance goals and conditions as having been met as of the date
of the change in control. Any stock options or SARs that become
vested on a “single-trigger” basis generally would
remain exercisable for the full duration of the term of the
applicable award.
The
compensation committee has the discretion to determine whether or
not any outstanding awards granted under the 2007 Plan will be
assumed by the resulting entity in connection with a change in
control, and the compensation committee has the authority to make
appropriate adjustments in connection with the assumption of any
awards. The compensation committee also has the right to cancel any
outstanding awards in connection with a change in control, in
exchange for a payment in cash or other property (including shares
of the resulting entity) in an amount equal to the excess of the
fair market value of the shares subject to the award over any
exercise price related to the award, including the right to cancel
any “underwater” stock options and SARs without payment
therefor.
For
purposes of our 2007 Plan, subject to exceptions set forth in the
2007 Plan, a “change in control” generally includes:
(a) the acquisition of more than 50% of the company’s common
stock; (b) the incumbent board of directors ceasing to constitute a
majority of the board of directors; (c) a reorganization, merger,
consolidation or similar transaction, or a sale of substantially
all of the Company’s assets; and (d) the complete liquidation
or dissolution of the company. The full definition of “change
in control” is set forth in the 2007 Plan.
TRANSACTIONS WITH
RELATED PERSONS
Any
transaction with a related person is subject to our written policy
for transactions with related persons, which is available on our
website at
www.bktechnologies.com/resources/policies-and-procedures. The
nominating and corporate governance committee is responsible for
applying this policy. As set forth in the policy, the nominating
and corporate governance committee reviews the material facts of
the transaction and considers, among other factors it deems
appropriate, whether the transaction is on terms no less favorable
than terms generally available to an unaffiliated third-party under
the same or similar circumstances and the extent of the related
person’s interest in the
transaction. The policy also prohibits our directors from
participating in any discussion or approval of any interested
transaction for which he is a related person, except that the
director is required to provide all material information concerning
the transaction to the nominating and corporate governance
committee.
If a
transaction with a related party will be ongoing, the nominating
and corporate governance committee will establish guidelines for
our management to follow in its ongoing relationships with the
related person, will review and assess ongoing relationships with
the related person to determine if such relationships are in
compliance with the committee’s guidelines, and based on all the
relevant facts and circumstances, will determine if it is in the
best interests of the Company and our stockholders to continue,
modify or terminate any such interested transaction.
The
policy provides exceptions for certain transactions, including (i)
those involving compensation paid to a director or executive
officer required to be reported in the Company’s proxy statement, (ii) transactions
with another company at which a related person’s only relationship is as an
employee (other than an executive officer), director or beneficial
owner of less than 10% of that company’s shares, if the aggregate amount
involved does not exceed the greater of $500,000, or two percent
(2%) of that company’s
total annual revenues, (iii) certain charitable contributions, (iv)
transactions where all stockholders of the Company receive
proportional benefits, (v) transactions involving competitive bids,
(vi) certain regulated transactions and (vii) certain
banking-related services.
On
March 14, 2018, Randy Willis was appointed as Chief Operating
Officer of the Company, having served as Vice President of Operations of the Company since
August 2017. Prior to Mr. Willis joining the Company in August
2017, the Company engaged Target Velocity Consulting, Inc., of
which Mr. Willis is President, to provide operational consulting
services to the Company in 2017 for the total fees of $59,616. For
his service as Vice President of Operations from August 2017 to
March 2018, Mr. Willis received payments equal to $80,770 in 2017
and an additional $46,154 in 2018 and a grant of non-qualified
stock options to purchase 25,000 shares of the Company’s
common stock, at an exercise price of $4.20 per share, on August
30, 2017. The options have a ten-year term and become exercisable
in one-fifth annual installments, beginning on the first
anniversary of the grant date.
Except
as set forth above, during 2017 and 2016, we did not have any
transactions with related persons that were reportable under Item
404 of Regulation S-K, and we do not have any transactions with
related persons currently proposed for 2018 that are reportable
under Item 404 of Regulation S-K.
RELATIONSHIP WITH OUR
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Moore
Stephens Lovelace, an independent registered public accounting
firm, audited our financial statements for fiscal 2017 and fiscal
2016. We had no disagreements with Moore Stephens Lovelace on
accounting and financial disclosures. Moore Stephens
Lovelace’s work on our
audit for fiscal 2017 was performed by full time, permanent
employees and partners of Moore Stephens Lovelace.
Moore
Stephens Lovelace, which has served as our independent registered
public accounting firm since November 2015, has been reappointed to
serve as our independent registered public accounting firm for
fiscal 2018. The audit committee, in discussing the reappointment
of Moore Stephens Lovelace, considered the qualifications,
experience, independence, compliance with regulations, quality
control, candor, objectivity, and professional skepticism of Moore
Stephens Lovelace and the effectiveness of the firm’s processes, including its
timeliness and responsiveness and communication and interaction
with management. The audit committee also considered the tenure of
Moore Stephens Lovelace as our independent registered public
accounting firm and its related depth of understanding of our
businesses, operations and systems. The audit committee and the
board of directors believe that the continued retention of Moore
Stephens Lovelace as our independent registered public accounting
firm is in the best interests of the Company and our
stockholders.
PROPOSAL 2: RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
General
Our
audit committee has appointed Moore Stephens Lovelace to serve as
our independent registered public accounting firm for fiscal 2018.
Representatives of Moore Stephens Lovelace are expected to be
present at the annual meeting and will have the opportunity to make
a statement if they so desire, and will be available to respond to
appropriate stockholder questions.
Although applicable
law does not require stockholder ratification of the appointment of
Moore Stephens Lovelace to serve as our independent registered
public accounting firm, our board has decided to ascertain the
position of our stockholders on the appointment. If our
stockholders do not ratify the appointment of Moore Stephens
Lovelace, our audit committee will reconsider the appointment. Even
if the selection is ratified, our audit committee in its discretion
may appoint a different independent registered public accounting
firm at any time during the year if it determines that such a
change would be in our best interests and in the best interests of
our stockholders.
Vote Required
This
proposal will be approved if the number of votes cast “for” the ratification of Moore Stephens
Lovelace as our independent registered public accounting firm
exceed the number of votes cast “against” ratification. Abstentions and
broker non-votes will have no effect on the outcome of the vote.
Shares represented by properly executed proxies will be voted, if
specific instructions are not otherwise given, in favor of this
proposal.
Recommendation of the Board
Our
board of directors unanimously recommends that stockholders vote
“FOR” the ratification of the appointment
of Moore Stephens Lovelace as our independent registered public
accounting firm.
FEES PAID TO OUR INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The
rules of the SEC require us to disclose fees billed by our
independent registered public accounting firm for services rendered
to us for each of the years ended December 31, 2017 and 2016. The
following table represents aggregate fees billed for the fiscal
years ended December 31, 2017 and 2016 by Moore Stephens
Lovelace.
Fees
|
|
|
Audit
Fees(1)
|
$105,000
|
$105,000
|
Audit-Related
Fees(2)
|
—
|
—
|
Tax
Fees(3)
|
—
|
—
|
All Other
Fees(4)
|
—
|
—
|
Total
|
$105,000
|
$105,000
|
(1)
|
For
2017 and 2016, includes fees paid to Moore Stephens Lovelace for
professional services rendered for the audit for our annual
financial statements for the years ended December 31, 2017 and 2016
and for reviews of the financial statements included in our
Quarterly Reports on Form 10-Q for the fiscal quarters ended March
31, June 30 and September 30 in each of those years.
|
(2)
|
No
audit-related services were performed for us by Moore Stephens
Lovelace in 2017 or 2016. Audit-related services include assurance
and related services that are related to the performance of the
audit or review of our financial statements.
|
(3)
|
No tax
services were performed for us by Moore Stephens Lovelace in 2017
or 2016. Tax services include tax compliance, tax advice and tax
planning.
|
(4)
|
No
other services were performed for us by Moore Stephens Lovelace in
2017 or 2016.
|
As
previously discussed, the audit committee has implemented
pre-approval procedures consistent with the rules adopted by the
SEC.
The
audit committee has determined that the provision of the services
by Moore Stephens Lovelace reported hereunder had no impact on its
independence.
PROPOSAL 3: AMENDMENT TO OUR ARTICLES OF
INCORPORATION TO CHANGE OUR
CORPORATE NAME FROM RELM WIRELESS CORPORATION TO BK TECHNOLOGIES,
INC.
General
Our
board has approved, and recommends that our stockholders approve,
an amendment to our Articles of Incorporation to change our
corporate name from RELM Wireless Corporation to BK Technologies,
Inc.
Reasons for the Proposed Name Change
The
board believes that changing our corporate name to BK Technologies,
Inc. is an important step in our efforts to create better alignment
between our corporate and product brands, including our BK Radio
brand. As part of a new branding strategy, the Company has been
conducting business and marketing its products and services under
the “BK Technologies” name. The Company has also been
selling its products under the name of “BK Radio.”
Consistent with this effort, the board believes that changing the
corporate name will more accurately reflect the Company’s
brand identity as the “BK Technologies” name continues
to gain market recognition. Further, the board expects that the
name change will eliminate any confusion in the marketplace, assist
with the Company’s expansion into targeted markets and enable
the Company to compete more effectively in its
industry.
Text of Proposed Amendment; Effects
If
the proposed amendment to the Articles of Incorporation is approved
by stockholders, Article FIRST of our Articles of Incorporation
will be amended in its entirety to provide as follows:
“FIRST:
The
name of the corporation (hereinafter called the corporation) is BK
Technologies, Inc.”
The
proposed amendment, if approved, will become effective when a
Certificate of Amendment to our Articles of Incorporation is filed
with and accepted by the Secretary of State of the State of Nevada.
The corporate name change will not affect our corporate structure
or any of our operations or businesses.
Our common stock is currently traded on the NYSE
American under the symbol “RWC.” If the amendment is
approved and the corporate name change becomes effective, we will
continue to be listed on the NYSE American. We expect that our
common stock will begin trading under a new NYSE American symbol,
“[•],”at the time we effect our name
change.
If
the corporate name change becomes effective, the rights of
stockholders holding certificated shares under currently
outstanding stock certificates and the number of shares represented
by those certificates will remain unchanged. The new corporate name
will not affect the validity or transferability of any currently
outstanding stock certificates nor will it be necessary for
stockholders with certificated shares to surrender any stock
certificates they currently hold as a result of the name change.
After the name change, all new stock certificates issued by the
Company and all uncertificated shares held in direct registration
accounts, including uncertificated shares currently held in direct
registration accounts, will bear the name BK Technologies,
Inc.
If
the amendment is not approved by stockholders, the proposed
amendment to our Articles of Incorporation will not be filed, the
corporate name of the Company will remain unchanged and our ticker
symbol for trading our common stock on the NYSE American will
remain unchanged.
Notwithstanding
approval of the proposed amendment by the stockholders, the board
reserves the right to, without further vote by our stockholders,
abandon the proposed corporate name change at any time and not file
the Certificate of Amendment if the board concludes that such
action would be in the best interest of the Company or our
stockholders.
Vote Required
Approval of the
amendment to our Articles of Incorporation to change our corporate
name from RELM Wireless Corporation to BK Technologies, Inc.
requires the affirmative vote of the holders of at least a majority
of the issued and outstanding shares of the Company’s common
stock. Abstentions and broker
non-votes will be treated as votes “AGAINST” the
proposal. Shares represented by properly executed proxies
will be voted, if specific instructions are not otherwise given, in
favor of this proposal.
Recommendation of the Board
Our
board of directors unanimously recommends that stockholders vote
“FOR” the amendment to our Articles of
Incorporation to change our corporate name from RELM Wireless
Corporation to BK Technologies, Inc.
EQUITY COMPENSATION PLAN
INFORMATION
The
following table provides information as of December 31, 2017 with
respect to our 2017 Incentive Compensation Plan, under which our
common stock is authorized for issuance, and the 2007 Incentive
Compensation Plan. Our stockholders approved the 2017 Incentive
Compensation Plan at the 2017 annual stockholders’ meeting.
On December 31, 2017, 645,500 shares of our common stock were
available for issuance under the 2017 Incentive Compensation
Plan.
Plan Category
|
(a)
Number of securities to be issued upon exercise of outstanding
options, warrants and rights (1)
|
(b) Weighted- average exercise price of outstanding options,
warrants and rights
|
(c)
Number of securities remaining available for future issuance under
equity compensation plan (excluding securities reflected in column
(a)) (2)
|
Equity compensation
plans approved by security holders
|
354,500
|
$4.46
|
645,500
|
Equity compensation
plans not approved by security holders
|
—
|
—
|
—
|
Total
|
354,500
|
$4.46
|
645,500
|
(1)
|
Includes
70,000 shares issuable upon the exercise of awards outstanding
under the 2017 Incentive Compensation Plan and 284,500 shares issuable upon the exercise of
awards outstanding under the 2007 Incentive Compensation
Plan.
|
(2)
|
Represents
shares available for issuance under the 2017 Incentive Compensation
Plan.
|
Section 16(a) Beneficial
Ownership Reporting Compliance
Section
16(a) of the Exchange Act requires that our directors and executive
officers, and persons who own more than 10 percent of our common
stock, file with the SEC initial statements of beneficial ownership
of common stock and statements of changes in beneficial ownership
of common stock.
Based
solely on a review of the copies of such reports and
representations that no other reports were required, we believe
that all Section 16 filing requirements applicable to our officers,
directors and ten percent (10%) beneficial owners were timely
complied with during fiscal 2017, except as follows: General
Payne’s Form 4 reporting a grant of options to purchase
shares of our common stock, filed on January 12, 2017, was
inadvertently filed late due to processing difficulties in
obtaining EDGAR filing codes, Messrs. Kelly, Holthaus and
Vitou’s respective Forms 4 reporting a grant of options to
purchase shares of our common stock, filed on September 6, 2017,
were inadvertently filed late, and General Payne’s Form 4
reporting a purchase of shares of our common stock, filed on
February 12, 2018, was inadvertently filed late.
Annual
Report on Form 10-K
Copies
of our Annual Report on Form 10-K for fiscal 2017, as filed with
the SEC, are available to stockholders without charge upon written
request to Corporate Secretary of RELM at 7100 Technology Drive,
West Melbourne, Florida 32904.
Eliminating Duplicative Proxy Materials
A
single Notice of Internet Availability of Proxy Materials or a
single copy of our Annual Report on Form 10-K for fiscal 2017 and
this proxy statement will be delivered to multiple stockholders who
live at the same address. If you live at the same address as
another stockholder and would like to receive your own copy of the
Notice of Internet Availability of Proxy Materials, the 2017 annual
report, or this proxy statement, or would like to receive multiple
copies of our proxy materials in the future, please contact us at
7100 Technology Drive, West Melbourne, Florida 32904; telephone
number: (321) 984-1414. A separate copy of the Notice of Internet
Availability of Proxy Materials, or of our 2017 annual report and
this proxy statement, will be delivered to you promptly and without
charge. If you live at the same address as another stockholder and
are receiving multiple copies of our proxy materials, please
contact us at the telephone number or address above if you only
want to receive one copy of those materials.
Stockholder Proposals
Inclusion of Proposals in our Proxy Statement Pursuant to SEC
Rules
Pursuant to Rule
14a-8 under the Exchange Act, some stockholder proposals may be
eligible for inclusion in our proxy statement for our 2019 annual
meeting of stockholders. To be eligible for inclusion in our 2019
proxy statement, any such proposals must be delivered in writing to
the Corporate Secretary of RELM no later than December 21, 2018,
and must meet the requirements of Rule 14a-8 under the Exchange
Act. The submission of a stockholder proposal does not guarantee
that it will be included in our proxy statement.
Advance Notice Requirements for Stockholder Submission of
Nominations and Proposals
In
addition, pursuant to the advance notice provisions set forth in
our bylaws, for a stockholder’s proposal or nomination to be
properly presented at the 2019 annual meeting of stockholders, but
not submitted for inclusion in our proxy statement, such
stockholder’s written
notice of the intent of such stockholder to make a nomination of a
person for election as a director or to bring any other matter
before the annual meeting must be delivered to the Corporate
Secretary of RELM at the principal executive offices of the Company
no less than 120 days nor more than 180 days prior to the first
anniversary of the date on which we first mailed our proxy
materials for the preceding year’s annual meeting of stockholders. As
a result, proposals for the 2019 annual meeting of stockholders
submitted outside the provisions of Rule 14a-8 will be considered
untimely if submitted prior to October 22, 2018 or after December
21, 2018. Also, any proxy granted with respect to the 2019 annual
meeting of stockholders will confer on management discretionary
authority to vote with respect to a stockholder proposal or
director nomination if notice of such proposal or nomination is not
received by our Corporate Secretary within the timeframe provided
above.
Other Matters
As of
the date of this proxy statement, our board of directors does not
know of any other matters for consideration at the annual meeting
other than as described in this proxy statement. If, however, any
other matters are properly brought before the annual meeting, the
persons named as proxies will vote in accordance with their best
judgment with respect to such matters.
PRELIMINARY COPY, DATED MARCH 15, 2018 – SUBJECT TO
COMPLETION
RELM WIRELESS CORPORATION -
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS
ANNUAL
MEETING OF STOCKHOLDERS – JUNE 4, 2018 AT 10:00 A.M., LOCAL
TIME
|
|
|
|
|
|
CONTROL ID:
|
|
|
|
|
|
|
|
REQUEST ID:
|
|
|
|
|
|
|
|
The
undersigned stockholder(s) of RELM Wireless Corporation, a Nevada
corporation (the “Company”), hereby revoking any proxy
heretofore given, does hereby appoint Timothy A. Vitou and William
P. Kelly, and each of them, with full power to act alone, the true
and lawful attorneys-in-fact and proxies of the undersigned, with
full powers of substitution, and hereby authorize(s) them and each
of them, to represent the undersigned and to vote all shares of
common stock of the Company that the undersigned is entitled to
vote at the 2018 Annual Meeting of Stockholders of the Company to
be held on June 4, 2018 at 10:00 a.m., local time, at the
Company’s corporate offices located at 7100 Technology Drive,
West Melbourne, Florida 32904, and any and all adjournments and
postponements thereof, with all powers the undersigned would
possess if personally present, on the following proposals, each as
described more fully in the accompanying proxy statement, and any
other matters coming before said meeting.
|
|
|
|
|
|
|
|
|
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
|
|
|
|
|
|
|
|
VOTING INSTRUCTIONS
|
|
|
|
|
|
|
If you vote by phone, fax or internet, please DO NOT mail your
proxy card.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MAIL:
|
Please
mark, sign, date, and return this Proxy Card promptly using the
enclosed envelope.
|
|
|
|
|
|
|
FAX:
|
Complete the
reverse portion of this Proxy Card and Fax to 202-521-3464.
|
|
|
|
|
|
|
INTERNET:
|
https://www.iproxydirect.com/RWC
|
|
|
|
|
|
|
PHONE:
|
1-866-752-VOTE(8683)
|
|
|
|
|
|
PRELIMINARY COPY, DATED MARCH 15, 2018 – SUBJECT TO
COMPLETION
ANNUAL MEETING
OF THE STOCKHOLDERS OF
RELM WIRELESS
CORPORATION
|
PLEASE
COMPLETE, DATE, SIGN AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE:
☒
|
|
PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
|
|
|
Proposal 1
|
|
|
FOR ALL
|
|
WITHHOLD
ALL
|
|
FOR ALL
EXCEPT
|
|
|
|
|
Election of
Directors:
|
|
☐
|
|
☐
|
|
|
|
|
|
|
D. Kyle
Cerminara
|
|
|
|
|
|
☐
|
|
|
|
|
Michael R.
Dill
|
|
|
|
|
|
☐
|
|
|
|
|
Lewis M.
Johnson
|
|
|
|
|
|
☐
|
|
CONTROL
ID:
|
|
|
Charles T.
Lanktree
|
|
|
|
|
|
☐
|
|
REQUEST
ID:
|
|
|
General E. Gray
Payne
|
|
|
|
|
|
☐
|
|
|
|
|
John W.
Struble
|
|
|
|
|
|
☐
|
|
|
|
|
Ryan R.K.
Turner
|
|
|
|
|
|
☐
|
|
|
|
Proposal 2
|
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
|
To ratify the appointment of
Moore Stephens Lovelace, P.A. as our independent registered public
accounting firm for fiscal 2018.
|
|
☐
|
|
☐
|
|
☐
|
|
|
|
Proposal 3
|
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
|
To amend our Articles of
Incorporation to change our corporate name from RELM Wireless
Corporation to BK Technologies, Inc.
|
|
☐
|
|
☐
|
|
☐
|
|
|
|
Proposal 4
|
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
|
To transact such other business
properly brought before the meeting and any adjournment or
postponement of the meeting.
|
|
☐
|
|
☐
|
|
☐
|
|
|
|
This proxy will be voted in the
manner directed herein by the undersigned.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU
VOTE, AND IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED,
“FOR” THE ELECTION OF THE NOMINEES FOR DIRECTOR NAMED
IN PROPOSAL 1, “FOR” RATIFICATION OF THE AUDITOR
APPOINTMENT IN PROPOSAL 2, “FOR” THE AMENDMENT TO OUR
ARTICLES OF INCORPORATION TO CHANGE OUR NAME FROM RELM WIRELESS
CORPORATION TO BK TECHNOLOGIES, INC. IN PROPOSAL 3, AND
IN THE DISCRETION OF THE PROXIES
ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE ANNUAL
MEETING OR ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF TO THE EXTENT
PERMITTED UNDER APPLICABLE LAW.
|
|
|
|
MARK “X” HERE IF YOU PLAN TO
ATTEND THE MEETING: ☐
|
|
|
|
|
MARK HERE FOR ADDRESS CHANGE
☐ New Address
(if
applicable):
__________________________
__________________________
__________________________
IMPORTANT: Please sign exactly as your
name or names appear on this Proxy. When shares are held jointly,
each holder should sign. When signing as executor, administrator,
attorney, trustee or guardian, please give full title as such. If
the signer is a corporation, please sign full corporate name by
duly authorized officer, giving full title as such. If signer is a
partnership, please sign in partnership name by authorized
person.
Dated:
________________________, 2018
|
|
(Print Name of Stockholder and/or Joint
Tenant)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Signature
of Stockholder)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Second
Signature if held jointly)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PRELIMINARY COPY, DATED MARCH 15, 2018 – SUBJECT TO
COMPLETION
RELM WIRELESS CORPORATION
|
CONTROL ID:
|
|
|
REQUEST ID:
|
|
|
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY
MATERIALS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
|
|
|
DATE:
|
JUNE 4, 2018
|
|
|
TIME:
|
10:00 AM Local Time
|
|
|
LOCATION:
|
7100 Technology Drive, West Melbourne, Florida 32904
|
|
HOW TO REQUEST PAPER COPIES OF OUR MATERIALS
|
|
|
|
|
|
|
PHONE:
Call toll free
1-866-752-8683
|
FAX:
Send this card to
202-521-3464
|
INTERNET: https://www.iproxydirect.com/RWC
and follow the
on-screen instructions.
|
EMAIL:
proxy@iproxydirect.com
Include your Control
ID in your email.
|
|
|
|
This
communication represents a notice to access a more complete set of
proxy materials available to you on the Internet. We encourage you
to access and review all of the important information contained in
the proxy materials before voting. The Proxy Statement, 2017 Annual
Report and Proxy Card are available at: https://www.iproxydirect.com/RWC
|
|
|
|
If you want to receive a paper copy of
the proxy materials you must request one. There is no charge to you
for requesting a copy. To facilitate timely delivery please make
the request, as instructed above, before May 25,
2018.
|
|
|
|
you may enter your
voting instructions at https://www.iproxydirect.com/RWC
until 11:59 pm
eastern time June 3,
2018.
|
|
|
|
|
The purposes of this meeting are as follows:
|
|
|
1.
To
elect seven directors named in the proxy statement to serve on our
board of directors until the next annual meeting of stockholders
and until their respective successors are duly elected and
qualified;
2.
To
ratify the appointment of Moore Stephens Lovelace, P.A. as our
independent registered public accounting firm for fiscal
2018;
3.
To
amend our Articles of Incorporation to change our corporate name
from RELM Wireless Corporation to BK Technologies, Inc;
and
4.
To
transact such other business properly brought before the meeting
and any adjournment or postponement of the meeting.
|
|
Pursuant to Securities and Exchange Commission rules, you are
receiving this Notice that the proxy materials for the Annual
meeting are available on the Internet. Follow the instructions
above to view the materials and vote or request printed
copies.
The board of directors has fixed the close of business on April 13,
2018 as the record date for the determination of stockholders
entitled to receive notice of the Annual Meeting and to vote the
shares of our common stock, par value $.60 per share, That they
held on that date at the meeting or any postponement or adjournment
of the meeting.
|
|
The Board of Directors recommends that you vote “for”
all proposals above.
|
|
|
|
Please note – This is not a Proxy Card - you cannot vote by
returning this card
|
|
Relm
Wireless Corporation
SHAREHOLDER
SERVICES
500
Perimeter Park Drive Suite D
Morrisville
NC 27560
TIME SENSITIVE SHAREHOLDER INFORMATION ENCLOSED
IMPORTANT SHAREHOLDER INFORMATION
YOUR VOTE IS IMPORTANT