proxystatement.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20649
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities
Exchange
Act of 1934 (Amendment No. __)
Filed
by the
Registrant T
Filed
by a Party other than the
Registrant □
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appropriate box:
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Preliminary
Proxy
Statement
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Confidential,
for Use of the Commission Only (as
permitted by Rule
14a-6(e)(2))
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T
Definitive Proxy Statement
□
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Definitive
Additional
Materials
|
□
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Soliciting
Material Pursuant to §
240.14a-12
|
ADDvantage
Technologies Group, Inc.
________________________________________________________
(Name
of
Registrant As Specified In Its Charter)
______________________________________________________________________________
(Name
of
Person(s) Filing Proxy Statement, if other than the Registrant)
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2)
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Aggregate
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Per
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to
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statement
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1)
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Form,
Schedule or Registration Statement No.:
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4)
Date
Filed:
ADDvantage
Technologies Group, Inc.
1221
East Houston
Broken
Arrow, Oklahoma 74012
Date:
Thursday, March 6, 2008
Time:
10:00 A.M.
Place:
Corporate Office of ADDvantage Technologies Group, Inc.
1221 East Houston
Broken Arrow, Oklahoma 74012
1.
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Election
of seven directors.
|
2.
|
Ratification
of the appointment of Hogan & Slovacek as our independent auditors for
2008.
|
3.
|
Any
other business properly brought before the shareholders at the
meeting.
|
Your
vote
at the annual meeting is important to us. Please vote your shares of
common stock by completing the enclosed proxy card and returning it to us in
the
enclosed envelope. This proxy statement has information about the
annual meeting and was prepared by our management and our Board of
Directors. This proxy statement is first being sent to shareholders
on or about February 1, 2008. Please note that our annual report
accompanies this mailing of the proxy statement.
|
By
Order of the Board of Directors,
|
/s/
Daniel E.
O'Keefe
|
Daniel
E. O'Keefe, Vice President, Chief Financial Officer and Secretary
|
January
25, 2008
ADDVANTAGE
TECHNOLOGIES GROUP, INC.
PROXY
STATEMENT
ADDvantage
Technologies Group, Inc.
1221
East Houston
Broken
Arrow, Oklahoma 74012
PROXY
STATEMENT FOR 2008 ANNUAL MEETING
Who
can attend the annual meeting?
All
stockholders as of the record date, January 17, 2008.
Who
can vote?
You
can
vote your shares of common stock if our records show that you owned the shares
on January 17, 2008. A total of 10,249,656 shares of common stock can
vote at the annual meeting. You get one vote for each share of common
stock. We do not recognize cumulative voting for the election of our
directors. The enclosed proxy card shows the number of shares you can
vote.
How
do I vote by proxy?
Follow
the instructions on the enclosed proxy card to vote on each proposal to be
considered at the annual meeting. Sign and date the proxy card and
mail it back to us in the enclosed envelope. The proxyholders named
on the proxy card will vote your shares as you instruct. If you sign
and return the proxy card but do not vote on a proposal, the proxyholders will
vote for you on that proposal. Unless you instruct otherwise, the
proxyholders will vote for
each of
the seven directors and for
the
ratification of Hogan & Slovacek as independent
auditors.
What
if other matters come up at the annual meeting?
The
matters described in this proxy statement are the only matters we know will
be
voted on at the annual meeting. If other matters are properly
presented at the meeting, any proxies returned to us will be voted as the
proxyholders see fit.
Can
I change my vote after I return my proxy card?
Yes. At
any time before the vote on a proposal, you can change your vote either by
giving our secretary a written notice revoking your proxy card or by signing,
dating and returning to us a new proxy card. We will honor the proxy
card with the latest date. Attendance at the annual meeting will not,
by itself, revoke your proxy card.
Can
I vote in person at the annual meeting rather than by completing the proxy
card?
Although
we encourage you to complete and return the proxy card to ensure that your
vote
is counted, you can attend the annual meeting and vote your shares in
person. If your shares are held in the name of your broker, a bank,
or other nominee, that party should give you instructions for voting your
shares.
How
are votes counted?
We
will
hold the annual meeting if holders of a majority of the shares of common stock
entitled to vote either sign and return their proxy cards or attend the
meeting. If you sign and return your proxy card, your shares will be
counted to determine whether we have a quorum even if you abstain or fail to
vote on any of the proposals listed on the proxy card. Votes will be
tabulated by an inspector of election appointed by our Board of
Directors. Abstentions from voting, which you may specify on the
ratification of the appointment of Hogan & Slovacek as independent auditors,
will have the effect of a negative vote.
If
your
shares are held in the name of a nominee, and you do not tell the nominee how
to
vote your shares (so-called “broker nonvotes”), the nominee may vote them on the
proposals to elect directors and to ratify the appointment of Hogan &
Slovacek as our independent auditors. Additionally, broker nonvotes
will be counted as present to determine if a quorum exists.
What
percentage of stock are the directors and executive officers entitled to vote
at
the annual meeting?
Together,
they own 4,513,400 shares of our common stock, or 44.0% of the stock entitled
to
vote at the Annual Meeting.
Who
are the largest principal stockholders?
Kenneth
A. Chymiak, our President and Chief Executive Officer, beneficially owns
2,046,000 shares of our common stock, or 20.0% of the stock entitled to vote
at
the Annual Meeting. David E. Chymiak, our Vice President and Chairman
of the Board, beneficially owns 2,429,900 shares of our common stock, or 23.7%
of the stock entitled to vote at the Annual Meeting.
Who
pays for this proxy solicitation?
The
accompanying proxy is solicited by and on behalf of our Board of Directors,
and
the entire cost will be paid by us. In addition to sending you these
materials, some of our employees may contact you by telephone, by mail or in
person. None of these employees will receive any extra compensation
for doing this, but they may be reimbursed for their out-of-pocket expenses
incurred while assisting us in soliciting your proxy.
We
have
three executive officers. Our officers are elected by our Board of
Directors and serve at the pleasure of the board.
David
E. Chymiak
Biographical
information for Mr. Chymiak, the Chairman
of our Board since 1999, is set forth below in Proposal No. 1, Election of
Directors.
Kenneth
A. Chymiak
Biographical
information for Mr. Chymiak, our President
and Chief Executive Officer since 1999, is set forth below in Proposal No.
1,
Election of Directors.
Daniel
E. O'Keefe
Biographical
information for Mr. O’Keefe, our Vice
President, Chief Financial Officer and Secretary since 2006, is set forth below
in Proposal No. 1, Election of Directors.
BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The
following table shows the number of shares of common stock beneficially owned
(as of January 17, 2008) by:
·
|
each
person known by us who beneficially owns more than 5% of any class
of our
voting stock;
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·
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each
director and nominee for director;
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·
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each
executive officer named in the Summary Compensation Table on page
17;
and
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·
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our
directors and executive officers as a
group.
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Except
as
otherwise indicated, the beneficial owners listed in the table have sole voting
and investment powers of their shares.
Beneficial
Ownershipof Directors
and
Officers
Name
and Address of
Beneficial
Owner
|
Number
of Shares of
Common
Stock
Beneficially
Owned
(1)
|
Percent
Of
Class
(1)
|
|
|
|
|
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David
E. Chymiak
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2,449,900
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(2)
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23.9%
|
|
|
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Kenneth
A. Chymiak
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2,066,000
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(2)(6)
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20.1%
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|
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Susan
C. Chymiak
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2,066,000
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(2)(7)
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20.1%
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|
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Thomas
J. Franz
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1,000
|
|
*
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|
|
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Paul
F. Largess
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-0-
|
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*
|
|
|
|
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Henry
F. McCabe
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17,000
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(4)(10)
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*
|
|
|
|
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James
C. McGill
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-0-
|
|
*
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|
|
|
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Daniel
E. O’Keefe
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10,000
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(5)
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*
|
|
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Stephen
J. Tyde
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50,000
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(3)(8)
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*
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All
Executive Officers and Directors as a group (9
persons)
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4,593,900
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(9)
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44.8%
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____________________________
* Less
than one
percent.
(1)
|
Shares
which an individual has the
right to acquire within 60 days pursuant to the exercise of options
are
deemed to be outstanding for the purpose of computing the percentage
ownership of such individual, but are not deemed to be outstanding
for the
purpose of computing the percentage ownership of any other person
shown in
the table or the percentage ownership of all officers and directors
as a
group.
|
(2) Includes
20,000 shares subject to
stock options which are
fully exercisable.
(3) Includes
16,000 shares subject to
stock options which are fully exercisable.
(4) Includes
15,000 shares subject to
stock options which are fully exercisable.
(5)
|
Includes
7,500 shares
subject to stock options which are fully exercisable and 2,500 shares subject
to stock options which will
become exercisable on March 6,
2008.
|
(6
)
|
Of
the shares beneficially owned
by Mr. Chymiak,
270,000are held of
record by him as trustee of the Ken ChymiakRevocable
Trust and 1,796,000 are
held of record by his spouse, Susan C. Chymiak as trustee of the
Susan
Chymiak Revocable Trust. Mr. Chymiak has sole voting and
investment power over those shares held of record by him. Mr.
Chymiak disclaims beneficial ownership ofthe shares
held by his
wife.
|
(7
)
|
Of
the shares beneficially owned
by Ms. Chymiak, 1,796,000 are held of record by her as trustee of
the
Susan Chymiak
Revocable Trust and 270,000are held of
record by her spouse,
Kenneth A. Chymiak as trustee of the Ken Chymiak Revocable
Trust. Ms. Chymiak has sole voting
and investment power over
those shares held of record by her. Ms. Chymiak disclaims
beneficial ownership of the shares held by herhusband.
|
(8)
|
Includes
17,000 shares owned by
Mr. Tyde's wife.
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(9)
|
Includes
83,500 shares subject to stock options of which 81,000 are fully
exercisable and 2,500 become exercisable on March 6, 2008.
|
(10) Is
not included as a nominee on the Election Ballot for the 2008 Board of
Directors
Securities
authorized for issuance
under equity compensation plans.
Plan
Category
|
Number
of securities to be issued upon exercise of outstanding options,
warrants
and rights
(a)
|
Weighted-average
exercise price of outstanding options, warrants and rights
(b)
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
(c)
|
Equity
compensation plans approved by security holders
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110,350
|
$3.15
|
744,966
|
Equity
compensation plans not approved by security holders
|
0
|
0
|
0
|
Total
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110,350
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$3.15
|
744,966
|
ELECTION
OF DIRECTORS
Seven
of
our current eight member Board of Directors are included as Nominees to be
elected at the annual meeting. The directors will be
elected for one-year terms expiring at the next annual meeting. Our
bylaws provide that our Board shall consist of not less than one nor more than
nine directors, as determined from time to time by board
resolution. Our Board has established the number of directors for the
2008 year to be seven.
Vote
Required. The seven nominees receiving the highest number of
votes will be elected. Votes withheld for a nominee will not be
counted. You get one vote for each of your shares of common stock for
each of the directorships.
Nominations. At
the annual meeting, we will nominate as directors the persons named in this
proxy statement. Although we do not know of any reason why one of
these nominees might not be able to serve, our Board of Directors will propose
a
substitute nominee if any nominee is unavailable for
election.
General
Information
About the Nominees. Three of the nominees are currently
directors of ADDvantage and the other four nominees were appointed to the Board
on August 9, 2007. Each has agreed to be named in this proxy
statement and to serve as director if elected. The ages listed for
the nominees are as of January 17, 2008.
David
E.
Chymiak
Director since 1999
David
E. Chymiak, 62, has been the Chairman of our Board
since 1999. He is also the President and a director of our wholly
owned subsidiary, Tulsat Corporation, which he acquired with Kenneth A. Chymiak
in 1985. David E. Chymiak is the brother of Kenneth A. Chymiak, our
President and Chief Executive Officer.
Kenneth
A.
Chymiak
Director since 1999
Kenneth
A. Chymiak, 61, has been our President and Chief
Executive Officer since 1999. He has also been the Executive Vice
President and a director of our wholly owned subsidiary, Tulsat Corporation,
which he acquired with David E. Chymiak in 1985. Kenneth A. Chymiak is the
brother of David E. Chymiak, our Chairman of the Board since
1999.
Paul
F.
Largess
Appointed
Director in August 2007
Paul
F.
Largess, 56, retired as Controller from CITGO Petroleum Corporation in 2006
after twenty-one years of service. His career at CITGO included a number of
positions in accounting, finance and audit. Prior to joining CITGO, he worked
for seven years as an auditor with Texaco and two years in public accounting.
He
holds a degree in accounting from The University of Tulsa and is a Certified
Public Accountant. In August 2007, Mr. Largess became Chairman of our
Audit Committee.
Thomas
J.
Franz
Appointed
Director in August 2007
Thomas
J.
Franz, 49, is currently head of TJ Franz & Associates, a firm specializing
in profitability and contract CFO consulting for small and medium sized
businesses, which he founded in 2003. For the ten years
prior, he served as Chief Financial Officer for several businesses and served
in
a Chief Operating Officer role as well. From 1983 to 1993 Franz held
several public accounting roles for clients in the banking, government, venture
capital, not for profit and financial services industries. Franz is a
Certified Public Account with a bachelor of business administration degree
from
Oklahoma State University where he also received a masters degree in
accounting.
James
C.
McGill
Appointed
Director in August 2007
James
C.
McGill, 64, has, since 1999, served as Chairman of the Board of MacroSolve,
Inc., which does business as Anyware Mobile Solutions, a provider of remote
end-user data services. In addition, he is a board member of numerous
organizations in the Tulsa, Oklahoma area. During his career, McGill has
received 25 U.S. and foreign patents in the field of pollution control, and
has
extensive experience in helping to develop early-stage and emerging companies.
McGill is a registered professional engineer, with a bachelor of science degree
in chemical engineering from The University of Tulsa, where he graduated Cum
Laude. He is a member of the University’s College of Engineering and Applied
Sciences Hall of Fame.
Daniel
E.
O’Keefe
Appointed
Director in August 2007
Daniel,
E. O’Keefe, 39, has been our Vice President, Chief Financial Officer and
Secretary since 2006. Mr. O'Keefe has 17 years of finance and management
experience. Prior to joining us, O’Keefe served as the Corporate Controller for
LinkAmerica Corporation from 1997 through 2001 and as President of Interstate
Express, Inc., a LinkAmerica Company, from 2001 through
2005. O’Keefe is a Certified Public Accountant with a bachelor
of business administration degree in accounting from the University of
Kansas.
Stephen
J.
Tyde
Director since 1999
Stephen
J. Tyde, 60, is the founder of The Pump &
Motor Works, Inc., a re-manufacturer of industrial pumps, motors, transformers
and switchgear (to 20,000 hp). After 20 years in the turbo machinery
business, Mr. Tyde started The Pump & Motor Works in 1989 and developed it
to a multi-million dollar operation before his divestiture in
2001. During that time, Mr. Tyde oversaw all aspects of the company
and retained personal responsibility for financial planning, reporting and
controls. He continues to serve on a part-time basis as Vice
President. Since 2001, Mr. Tyde has served as the sole owner and Chief Operating
Officer of P&MW Holding, Inc., an industrial real estate
company. Mr. Tyde received an undergraduate degree in Business
Administration from The Ohio State University, a Masters Degree in Business
Administration from George Washington University, and has studied engineering
at
the University of Pittsburgh. Mr. Tyde is the Chairman of our
Corporate Governance and Nominating Committee and until August of 2007 he also
served as the Chairman of our Audit and Compensation
Committees.
The
Board of Directors recommends a vote FOR the election of each
nominee.
Board
of Directors
Board
Independence. The Board of Directors has determined that
Messrs. Franz, Largess, McGill and Tyde have no relationship with us that would
interfere with the exercise of independent judgment in carrying out the
responsibilities of a director and that such individuals are independent under
the rules and listing standards of The NASDAQ Stock Market ("NASDAQ")
and the rules of the Securities and Exchange Commission implemented in response
to the Sarbanes-Oxley Act of 2002.
Committees
of the
Board. The Board of Directors has three committees, the Audit
Committee, the Compensation Committee and the Corporate Governance and
Nominating Committee. The following describes the functions and
membership of each committee and the number of times it met during our fiscal
year ended September 30, 2007:
The
functions and members of the Audit Committee are set forth
below. Stephen J. Tyde was the Chairman of the Committee from October
2006 through August 2007, at which time he was succeeded by Paul F.
Largess. The Audit Committee met five times during fiscal 2007. Four
of those meetings were held prior to the reporting of our quarterly financial
results.
Functions Members
·
|
Selects
the firm that will serve as our
independent
Thomas J. Franz
|
auditors
Paul F. Largess
·
|
Reviews
scope and results of audits with
independent
|
auditors,
compliance with any of our accounting
policies James
C. McGill
and
procedures and the adequacy of our system of internal
controls Stephen
J. Tyde
·
|
Oversees
quarterly reporting
|
· Performs
the other functions listed in the Charter of the Audit
Committee
which may be found on our website at www.addvantagetech.com.
Report
of
the Audit Committee
The
Audit
Committee of our Board of Directors is comprised of four directors who are
not
officers. Under currently applicable rules, each member is an independent
director
of our company under the rules of NASDAQ as well as under rules adopted by
the
Securities and Exchange Commission pursuant to the Sarbanes-Oxley Act of
2002.
The
Audit
Committee reviews our financial reporting process on behalf of the Board of
Directors. The Audit Committee’s policy is to review and pre-approve
all proposed engagements for audit or non-audit services rendered by our
independent auditors. Under its pre-approval policy, the Audit
Committee approved 100% of the services provided by Hogan & Slovacek in 2007
as those services are described in the section entitled "Principal Accounting
Fees and Services." Management has the primary responsibility for the
financial statements and the reporting process, including the system of internal
controls.
In
connection with its function to oversee and monitor our financial reporting
process, the Audit Committee has done the following:
-
|
selected
Hogan & Slovacek as our independent accountants for the audit of the
fiscal 2007 financial statements.
|
-
|
reviewed
and discussed the audited financial statements for the fiscal year
ended
September 30, 2007, with
management;
|
-
|
discussed
with the independent auditors the
matters required to be discussed by Statement on Auditing Standards
No. 61
as amended (AICPA, Professional Standards, Vol. 1. AU Section 380),
including the
independent auditor’s 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 under generally accepted
auditing standards;
|
-
|
received
the written disclosures and the letter from the independent accountants
required by Independence Standards Board Standard No. 1 (Independence
Standards Board Standard No. 1, Independence Discussions with Audit
Committees), and has discussed with the independent accountant the
independent accountant's independence;
and
|
-
|
based
on the reviews and discussions referred to above, recommended to
the Board
that the audited financial statements be included in our Annual Report
on
Form 10-K for fiscal year 2007 for filing with the Securities and
Exchange
Commission (the "SEC").
|
Thomas
J.
Franz
Paul F.
Largess
James C.
McGill
Stephen J. Tyde
Audit
Committee Financial Expert
The
SEC
has adopted rules pursuant to the provisions of the Sarbanes-Oxley Act requiring
audit committees to include an “audit committee financial expert,” defined as a
person who has the following attributes:
1) an
understanding of generally accepted accounting principles and financial
statements;
2) the
ability to assess the general application of such principles in connection
with
the accounting for estimates, accruals and reserves;
3)
experience preparing, auditing, analyzing or evaluating financial statements
that present a breadth and level of complexity of accounting issues that are
generally comparable to the breadth and complexity of issues that can reasonably
be expected to be raised by the registrant’s financial statements, or experience
actively supervising one or more persons engaged in such
activities;
4) an
understanding of internal control over financial reporting; and
5) an
understanding of audit committee functions.
The
financial expert will have to possess all of the attributes listed above to
qualify as an audit committee financial expert.
Our
Board
of Directors has determined that Thomas J. Franz, Paul F. Largess, James C.
McGill and Stephen J. Tyde each meets the definitions of a Audit Committee
financial expert as defined by the SEC in rules adopted pursuant to the
Sarbanes-Oxley Act of 2002.
Compensation
Committee
The
functions and members of the Compensation Committee are set forth
below. Stephen Tyde is Chairman of the Compensation Committee, which
met once during fiscal 2007.
Functions
Members
·
|
Evaluates
performance and sets compensation
and Henry
F. McCabe
|
benefits
of Chief Executive Officer and Chairman of the Board
of
Directors James
C. McGill
·
|
Approves
compensation and benefits
programs Stephen
J. Tyde
|
of
our
other named executive officers
·
|
Approves
compensation and benefits of our
non-employee
|
Board
of
Directors
·
|
Reviews
with management the Compensation Discussion and Analysis ("CD&A") and
determines whether to recommend to the Board of Directors that the
CD&A be included in the Company’s proxy statement for its annual
meeting of shareholders.
|
● |
Performs
the other functions listed in the Charter of the
Compensation Committee which may be found on our website at www.addvantagetech.com. |
Composition
and Delegation
The
Compensation Committee of our Board of Directors is comprised of three directors
who are not officers. All functions of the Compensation Committee are
to be performed by the Committee members and are not authorized to be delegated
outside of the Committee. Under currently applicable
rules, each member is an “independent director” as defined under Rule 4200 of
NASDAQ, a “non-employee director” (within the meaning of Rule 16b-3(b)(3) of the
Securities Exchange Act of 1934) and satisfies the requirements of an “outside
director” as defined by Section 162(m) of the Internal Revenue
Code.
Compensation
Discussion and Analysis
Objectives
of Compensation Program
The
Compensation Committee establishes and monitors the base salary of Kenneth
A.
Chymiak, President and Chief Executive Officer (CEO) and David E. Chymiak,
Vice
President and Chairman of the Board (Chairman). The Committee is
responsible for evaluating the overall performance of the CEO and Chairman
on an
annual basis and makes salary and incentive changes based on the results of
the
evaluation performed. The Compensation Committee has historically
maintained the same pay structure for both the CEO and Chairman positions as
both officers currently share the responsibilities for the top executive officer
of the Company. This historical practice is expected to continue as
long as Messrs. Chymiak maintain their current responsibilities.
The
Compensation Committee is guided by the following key objectives in determining
the compensation of our CEO, Chairman and other executive officers who are
specifically named in the table below captioned "Summary Compensation Table"
under the section captioned "Compensation of Directors and Executive Officers"
(“NEOs”):
A
goal of
the Compensation Committee is maintaining total compensation on a basis
consistent with similar companies that generate similar revenues and achieve
similar EBIT margins, as well as other strategic and performance
characteristics. Compensation should reflect the competitive
marketplace so that we can attract, retain and motivate high caliber
executives. In constructing the various elements of total
compensation, we generally target base pay to be at or below the market median
and incentive compensation to be at or above the market median. These
component objectives support our overall objective to establish a competitive
executive compensation program.
·
|
Accountability
for Business Performance
|
Compensation
should be largely tied to our overall financial and operating performance,
so
that executives are held accountable through their compensation for achievement
of our financial and operating results.
·
|
Accountability
for Individual Performance
|
Compensation
should also be tied to the individual’s performance to encourage and reflect
individual contributions to our performance.
·
|
Compensation
Program Design
|
Our
executive compensation program should be designed to clearly and fairly relate
pay to performance, with the objective of creating long term shareholder
value. Our executive compensation program should also be designed to
match pay practices with corporate goals. Each year, we approve an
incentive compensation plan. At the end of the year, the Compensation
Committee conducts a retrospective review of compensation related actions to
determine if objectives have been met.
·
|
Role
of Executive Officers in Compensation
Decisions
|
The
Compensation Committee is responsible for evaluating the overall performance
of
the CEO and Chairman on an annual basis and makes salary and incentive changes
based on the results of the evaluations performed. The CEO and
Chairman do not participate in this evaluation process but have, in the past,
declined or accepted on a reduced basis, certain Compensation Committee
recommended pay increases to their salaries.
The
CEO
and Chairman are responsible for making recommendations to the Committee for
the
base salaries and incentives of other NEOs. The Compensation
Committee reviews and approves or rejects these recommendations, on a majority
vote basis, without the votes of the CEO and Chairman. In the event
that a recommendation is not approved by a majority of the Committee, the CEO
and Chairman reevaluate, amend and resubmit their recommendation.
Elements
of Compensation
Our
executive compensation program has four elements: base salary,
non-equity incentive compensation, equity incentive compensation and
perquisites. Generally, we target compensation for our NEOs at levels
competitive with market median practice. In addition, NEOs holding
higher offices have the potential to receive a greater percentage of their
total
compensation in the form of non-equity incentive compensation.
From
time
to time, to we issue equity incentive compensation as inducement to attract
and
retain key NEOs. When we award equity incentive compensation, there
is typically a vesting period in which the incentive award is
earned. In addition, certain NEOs are members of the
Board of Directors and receive equity incentive awards, at levels similar to
other non-employee Directors, as compensation for their services as
Director. These equity incentive compensation awards are vested when
issued.
We provide
NEOs, officers and other employees with a base salary to compensate for services
rendered during the fiscal year.
·
|
Non-Equity
Incentive Compensation
|
Our
Senior Management – Incentive Compensation Plan is designed to provide
performance based compensation awards to executives for achievement of our
financial objectives.
·
|
Equity
Incentive Compensation
|
Equity
incentive compensation is awarded on a case by case basis based on the
recommendation of the CEO and approval by the Committee. In addition,
equity incentive compensation is earned by certain NEOs for service on the
Board
of Directors.
We
provide our NEOs (and certain other management employees) with limited
perquisites and other personal benefits that we believe are generally reasonable
and consistent with industry practice. In addition our NEOs
participate in the Company’s qualified 401(k) plan along with our other non-NEO
employees. After one year of service, employees receive a
dollar-for-dollar company matching contribution up to 5% of eligible
compensation.
The
NEOs
also are eligible to participate in the employee benefit plans and programs
generally available to other employees, including coverage under ADDvantage’s
medical, dental, life and disability insurance plans. Again, such
plans are consistent with our compensation objectives, particularly our ability
to recruit and retain employees. The costs associated with these
plans are not included as compensation in our Compensation Summary
Table.
Determination
of Amount of Each Element of Compensation
We
believe that we compete for executive talent against a broad array of companies,
not limited to our direct business competitors. We also believe that
the levels we pay our NEOs should reflect the size and scope of our
operations. Accordingly, we attempt to provide our NEOs with
compensation that is competitive with the pay levels for comparable positions
at
companies of similar revenues size. The Compensation Committee
engages Villareal and Associates, a local executive recruiting and consulting
firm, to identify the salaries of similar officers at other companies in the
local marketplace of similar revenue and employee size. The Committee
also obtains benchmarking compensation information from generally available
databases, primarily accessible through the internet. The
Compensation Committee evaluates and compares this information, along with
other
relevant facts and circumstances including but not limited to internal equity,
individual performance and individual job responsibilities, when making
compensation decisions as discussed below.
Although
compared annually to available salary data and surveys, the base salaries
established in 2006 for the CEO and Chairman were increased with a cost of
living adjustment based upon the Consumer Price Index as published by the Bureau
of Labor statistics. This procedure was deemed to be reasonable in
the market for executive management talent (as previously discussed) that is
not
dynamically changing.
· Non-Equity
Incentive Compensation
In
2007,
we approved the Senior Management Incentive Compensation Plan. Based
first on exceeding a targeted sales threshold, NEOs are awarded non-equity
incentive compensation based on comparison of our earnings before interest
and
taxes (EBIT) as a percentage of a set target EBIT. Under this plan,
cash incentives could be earned to a maximum of 55% of the CEO's and Chairman’s
base salaries.
%
Target
|
CEO
& CHAIRMAN INCENTIVE AWARD
(%
of Base Salary)
|
|
|
105%
|
15%
|
110%
|
20%
|
115%
|
25%
|
120%
|
30%
|
125%
|
35%
|
130%
|
40%
|
135%
|
45%
|
140%
|
50%
|
145+%
|
55%
|
Our
CEO
and Chairman received stock options during the second quarter of the fiscal
year
for their services as members of the Board of Directors, at levels consistent
with non-employee directors. Under SEC Rules, we are required to
report in the Summary Compensation Table the fair value of the stock options
issued to each of our NEOs. The fair values are calculated in
accordance with Financial Standards Board Statement of Financial Accounting
Standards No. 123 (revised 2004), Share-Based
Payment (FAS 123R).
For
the
fiscal year 2007, the perquisites and personal benefits awarded to NEOs were
limited to an automobile allowance and the matching contributions to the
Company’s qualified 401(k) plan.
Compensation
Committee Report
The
Compensation Committee reviewed and discussed the Compensation Discussion and
Analysis with management and, based on that review and discussion, recommended
to the Board that the Compensation Discussion and Analysis be included in this
Proxy Statement.
Henry
F.
McCabe
James C.
McGill
Stephen J. Tyde
Compensation
Committee Interlocks and Insider Participation
During
2007, the Compensation Committee was comprised of Freddie H. Gibson (until
his
resignation effective August 9, 2007), Henry F. McCabe, James C. McGill (from
the time of his appointment to the Board of Directors on August 9, 2007) and
Stephen J. Tyde, all of whom are non-employee directors. During 2007,
none of our executive officers served on the board of directors or on the
compensation committee of any other entity who had an executive officer that
served either on our Board of Directors or on its Compensation
Committee.
Corporate
Governance and Nominating Committee
The
functions and members of the Corporate Governance and Nominating Committee
are
set forth below. Stephen J. Tyde was the Chairman of the Committee
from October 2006 to August 2007, at which time he was succeeded by Henry F.
McCabe. The Committee met two times during fiscal
2007.
Functions
Members
·
|
Provides
oversight of the governance of the Board of
Directors Thomas
J. Franz
|
·
|
Makes
recommendations to the Board as a whole concerning
board
|
size,
make-up structure and
compensation Paul
F. Largess
·
|
Identifies
individuals qualified to become Board
members
|
·
|
Selects
or recommends that the Board select the director
nominees Henry
F. McCabe
|
to
stand
for election at the annual meeting of shareholders
·
|
Recommends
to the Board nominees for the positions of Chairman of the Board,
chairmen
of the various committees of the board, and members of the various
committees of the board
|
·
|
Reviews,
monitors and approves compliance with our Code of Business Conduct
and
Ethics
|
·
|
Considers,
reviews and approves potential conflict of interests involving Board
members or corporate officers
|
·
|
Performs
other functions listed in the Charter of the Corporate Governance
and
Nominating Committee which may be found on our website at
www.addvantagetech.com.
|
The
Corporate Governance and Nominating Committee is comprised of three directors
who are not officers. Under currently applicable rules, each member
is an “independent director” as defined under the NASDAQ rules as well as
under rules
adopted by the Securities and Exchange Commission pursuant to the Sarbanes-Oxley
Act of 2002.
The
Corporate Governance and Nominating Committee’s criteria and process for
identifying and evaluating the candidates that it selects, or recommends to
the
full Board for selection, as director nominees, are: (i) regular review of
composition and size of the board; (ii) review of qualifications of candidates
properly recommended or nominated by any qualifying shareholder; (iii)
evaluation of the performance of the Board and qualification of members of
the
Board eligible for re-election: and (iv) consideration of the suitability of
each candidate, including current members of the Board, in light of the size
and
composition of the Board. After such review and consideration, the
Corporate Governance and Nominating Committee will recommend, based soley on
the
vote of the independent committee members, a slate of director
nominees.
While
the
Corporate Governance and Nominating Committee has not established specific
minimum requirements for director candidates, other than they be at least 21
years of age, the Committee believes that candidates and nominees must reflect
a
board that is comprised of directors who: (i) are predominantly independent;
(ii) are of high integrity; (iii) have qualifications that will increase overall
board effectiveness; and (iv) meet other requirements as may be required by
applicable rules, such as financial literacy or financial expertise with respect
to audit committee members.
The
Corporate Governance and Nominating Committee has adopted a policy with regard
to the consideration of director candidates recommended by
shareholders. The Corporate Governance and Nominating Committee will
consider director candidates recommended by any shareholder holding 10,000
shares of our common stock for at least 12 months prior to the date of
submission of the recommendation or nomination. Additionally, a
recommending shareholder shall submit a written statement in support of the
candidate, particularly within the context of the criteria for board membership,
including issues of character, judgment, age, independence, expertise, corporate
experience, length of service, other commitments and the like, personal
references, and a written indication by the candidate of his/her willingness
to
serve, if elected, and evidence of the recommending person’s ownership of our
stock sufficient to meet the stock ownership requirements described
above.
Board
Meetings
Our
Board
held four meetings during fiscal 2007. Each director attended at
least 75% of all meetings of the Board and the committees on which he
served.
Shareholder
Communication with the Board of Directors and Committees
Communication
with the Board of Directors or any of the
Committees should be directed to the attention of Stephen J.
Tyde. Written correspondence to Mr. Tyde may be delivered to our
executive offices, 1221 East Houston, Broken Arrow, Oklahoma,
74012. All security holder communications directed to Mr. Tyde will
be promptly forwarded to him. All Board members are encouraged, but
not required, to attend our annual meeting. Last year, all of our
Board members attended our annual meeting.
We
have
adopted a Code of Business Conduct and Ethics which is applicable to all of
our
directors, officers and employees. A copy of our Code of Business Conduct and
Ethics is posted on our website at www.addvantagetech.com.
During
fiscal 2007, we leased four separate properties in Broken Arrow, Oklahoma from
two companies owned by David E. Chymiak and Kenneth A. Chymiak. The
combined lease payments made during fiscal 2007 on these properties totaled
$341,840. During the fiscal year, we purchased one of these
leased facilities, further discussed below, and are in the process of vacating
and consolidating the other three leased warehouses into the recently purchased
facility. We currently continue to lease these remaining properties
as overflow warehouse under existing leases which expire on September 30,
2008. The minimum future payments under these leases are expected to
total $331,840 in fiscal 2008.
On
November 20, 2006, we purchased real estate, consisting of an office and
warehouse facility located on ten acres in Broken Arrow, OK, from Chymiak
Investments, LLC, a Company owned equally by David E. Chymiak and Kenneth A.
Chymiak, for $3,250,000. The office and warehouse facility is currently being
utilized as our headquarters and the office and warehouse of our subsidiary,
Tulsat Corporation. The office and warehouse facility contains approximately
100,000 square feet of gross building area and was recently renovated and
modified for our specific use. This transaction was reviewed by our Corporate
Governance and Nominating Committee. The Committee evaluated several
options for leasing the building from Chymiak Investments, LLC and financing
options related to purchasing the real estate. In determining
whether to lease the property from Chymiak Investments, LLC or purchase the
property the Committee reviewed a "Lease vs. Buy" analysis performed by our
management showing the costs associated with leasing the property would be
greater than the costs associated with owning the real estate. Based on the
review of our liquidity and the financial benefits associated with owning the
property, the Committee recommended that we purchase the property for a fair
and
reasonable price. In evaluating the reasonableness of the purchase price, the
Committee reviewed a detail of the expenses paid by Chymiak Investments LLC
identifying the money spent to purchase the building and modify it for our
specific use totaling approximately $3.250 million, a third party independent
appraisal showing the appraised value at $3.420 million and an insurance report
from a third party property insurer identifying the replacement cost for the
real estate at $5.4 million. Based on the evaluation, the Committee recommended,
and the Board of Directors approved, the purchase of the real estate by us
for
$3.25 million.
On
November 27, 2007 we redeemed all of the issued and outstanding shares of the
Company’s Series B 7% Cumulative Preferred Stock (Series B
Stock). All of these shares of preferred stock were
beneficially held by 50% by David E. Chymiak and 50% by Kenneth A.
Chymiak. We financed the $12.0 million redemption price
of the outstanding Series B Stock through an increase in our revolving and
term
loan credit facility with our primary financial lender, Bank of
Oklahoma.
Section
16(a) of the Securities Exchange Act of 1934 requires our directors and
executive officers, and persons who own more than 10% of our common stock to
report their initial ownership of our common stock and any subsequent changes
in
that ownership to the SEC and to furnish us with a copy of each of these
reports. SEC regulations impose specific due dates for these reports
and we are required to disclose in this proxy statement any failure to file
by
these dates during fiscal 2006.
Based
solely on the review of the copies of these reports furnished to us and written
representations that no other reports were required, during and with respect
to
the fiscal year ended September 30, 2007, we believe that these persons have
complied with all applicable filing requirements.
Compensation of Directors
We
paid our non-employee
directors $500 per quarter and $500 for each board meeting and $250 for each
committee meeting or telephonic board or committee meeting the director
attends. The chairman of the audit committee receives an additional
$250 per quarter. In addition, directors are eligible to receive
awards of options to purchase shares of our common stock each year after the
annual shareholders meeting. These annual rewards have ranged between 1,000
and
5,000 shares. We reimburse all directors for out-of-pocket expenses
incurred by them in connection with their service on our Board and any Board
committee. The following table reflects the total compensation earned
by each director during the fiscal year:
Fiscal
2007 Director Compensation
Name
|
Fees
earned or
Paid
in Cash
|
Option
Awards (7)(8)
|
Total
Compensation
|
|
|
|
|
Thomas
J. Franz (1) (4) (5)
|
$1,500
|
$ 0
|
$ 1,500
|
Freddie
H. Gibson (2)
|
$5,570
|
$8,010
|
$13,580
|
Paul
F. Largess (1)
|
$2,000
|
$ 0
|
$ 2,000
|
Henry
F. McCabe (3) (5) (6)
|
$6,250
|
$8,010
|
$14,260
|
James
C. McGill (1) (4) (6)
|
$1,750
|
$ 0
|
$ 1,750
|
Stephen
J. Tyde (4) (6)
|
$6,750
|
$8,010
|
$14,760
|
(1) Appointed
to the Board effective August 2007.
(2) Resigned
from the Board effective August 2007.
(3) Is
not a
nominee for election to the 2008 Board of Directors
(4) Member
of
the Audit Committee
(5) Member
of
the Corporate Governance and Nominating Committee
(6) Member
of
the Compensation Committee
(7) The
amounts shown represent expenses recognized in the Consolidated Financial
Statements contained in the Company’s Annual Report on Form 10-K for the year
ended September 30, 2007 in accordance with Statement
of
Financial Accounting Standards No. 123R, Share Based Payment (SFAS 123R), for
stock option awards. Forfeitures of Stock Option awards were not
considered in the calculation. All assumptions utilized to
calculate
the expense amounts shown
above are set forth in Note 6 of the Notes to Consolidated Statements for the
year ended September 30, 2007.
(8) The
aggregate number of stock options outstanding for each Non-Employee Director
as
of September 30, 2007 is indicated in the table below.
|
Name
|
Exercisable
Options Outstanding as of 9/30/07
|
|
|
|
|
Thomas
J. Franz
|
0
|
|
Freddie
H. Gibson
|
0
|
|
Paul
F. Largess
|
0
|
|
Henry
F. McCabe
|
15,000
|
|
James
C. McGill
|
0
|
|
Stephen
J. Tyde
|
16,000
|
Name
and Principal Position
|
Year
|
Salary
|
Option
Awards(1)
|
Non-Equity
Incentive
Plan
Compensation(2)
|
All
Other
Compensation(3)
|
Total
Compensation
|
|
|
|
|
|
|
|
|
Kenneth
A. Chymiak
|
President and
Chief Executive Officer
|
2007
|
$
253,462
|
$ 8,010
|
$138,006
|
$ 14,831
|
$
414,309
|
|
|
|
|
|
|
|
|
David
E. Chymiak
|
Chairman
of the Board
|
2007
|
$
253,462
|
$ 8,010
|
$138,006
|
$ 14,831
|
$
414,309
|
|
|
|
|
|
|
|
|
Daniel
E. O’Keefe
|
Vice
President, Chief Financial Officer & Secretary
|
2007
|
$
136,462
|
$
20,264
|
$
38,948
|
$ 7,173
|
$
202,847
|
(1)
|
The
amounts shown represent expenses recognized in the Consolidated Financial
Statements contained in the Company’s Annual Report on Form 10-K for the
year ended September 30, 2007 in accordance with Statement of Financial
Accounting Standards No. 123R, Share Based Payment (SFAS 123R), for
stock
option awards. There were no forfeitures of stock option awards
in fiscal 2007. All assumptions utilized to calculate the expense
amounts
shown above are set forth in Note 6 of the Notes to Consolidated
Statements for the year ended September 30,
2007.
|
(2)
|
Amounts
represent payments to NEOs under the Senior Management Incentive
Compensation Plan for fiscal 2007 performance. This plan, which is
further
detailed in the Fiscal 2007 Grants of Plan-Based Awards table below,
provides annual cash payments to Senior Management based first on
exceeding certain sales growth threshold requirements and then allows
management to earn a graduated scale of incentive compensation based
on
the incremental EBIT earned on sales above the established sales
growth
threshold amount.
|
(3)
|
Represents
amounts paid by the Company on behalf of NEO for matching contributions
to
the Company’s qualified 401(K) plan plus an auto allowance received during
the year.
|
Fiscal
2007 Grants of Plan-Based Awards
Name
|
|
Grant
Date
|
Estimated
Future Payouts
Under
Non-Equity Incentive Plan Awards
|
Principal
Position
|
Threshold
|
Target
(1)
|
Maximum
|
|
|
|
|
|
|
Kenneth
A. Chymiak
|
President and
Chief Executive Officer
|
03/6/2007
|
$ -
|
$ 88,712
|
$ 139,404
|
David
E. Chymiak
|
Chairman
of the Board
|
03/6/2007
|
$ -
|
$ 88,712
|
$ 139,404
|
Daniel
E. O’Keefe
|
Vice
President, Chief Financial Officer & Secretary
|
03/6/2007
|
$ -
|
$ 25,200
|
$ 39,600
|
(1)
|
The
Target amount represents the median payout on the graduated scale
of our
Senior Management Incentive Compensation Plan. The non-equity
incentive that can be earned by the CEO and Chairman begins at 0%
of base
salary for reaching the threshold, the median target incentive level
is
25% of base salary, and the maximum amount that can be earned under
the
plan for the CEO and Chairman is 55% of base
salary.
|
Outstanding
Equity Awards at Fiscal Year End
Named Executive
Officer
|
Number
of
Securities Underlying Options which are Exercisable
|
Equity
Incentive
Plan Awards: Number of Securities
Underlying Unexercised Unearned Options
|
Option
Exercise
Price
|
Option
Expiration
Date
|
David
E.
Chymiak
|
1,000
|
|
$
3.125
|
4/4/2010
|
|
1,000
|
|
$
1.500
|
3/6/2011
|
|
1,000
|
|
$
0.810
|
3/1/2012
|
|
1,000
|
|
$
1.65
|
3/1/2013
|
|
1,000
|
|
$
4.40
|
3/4/2014
|
|
5,000
|
|
$
4.62
|
3/7/2015
|
|
5,000
|
|
$
5.78
|
3/6/2016
|
|
5,000
|
|
$
3.45
|
3/6/2017
|
Kenneth
A.
Chymiak
|
1,000
|
|
$
3.125
|
4/4/2010
|
|
1,000
|
|
$
1.500
|
3/6/2011
|
|
1,000
|
|
$
0.810
|
3/1/2012
|
|
1,000
|
|
$
1.65
|
3/1/2013
|
|
1,000
|
|
$
4.40
|
3/4/2014
|
|
5,000
|
|
$
4.62
|
3/7/2015
|
|
5,000
|
|
$
5.78
|
3/6/2016
|
|
5,000
|
|
$
3.45
|
3/6/2017
|
Daniel
E.
O'Keefe
|
5,000(1)
|
5,000 (2)
|
$
5.78
|
3/6/2016
|
|
5,000
|
|
$
3.45
|
3/6/2017
|
(1)
|
Includes
2,500 Options that become exersiable on March 6,
2008.
|
(2)
|
Options
vest over 2 years in equal increments of 2,500 shares
per year.
|
RATIFICATION
OF INDEPENDENT AUDITORS
Our
Audit
Committee has selected the accounting firm of Hogan & Slovacek as our
independent auditors to examine our financial statements for the fiscal year
ending September 30, 2008. Hogan & Slovacek has been our
independent auditor since it was engaged by our Audit Committee on January
26,
2006.
Representatives
from Hogan & Slovacek will attend the Annual Meeting to answer appropriate
questions and make statements if they desire.
The
Board
of Directors recommends a vote FOR the ratification of the appointment of Hogan
& Slovacek.
Hogan
& Slovacek ("Hogan") served as our independent auditor since it was engaged
by our Audit Committee on January 26, 2006 and audited our financial statements
for the two fiscal years ended September 30, 2007. Tullius, Taylor,
Sartain & Sartain (“Tullius”) performed the first quarter audit review in
fiscal 2006 as well as provided limited tax services during the same fiscal
year. Our Audit Committee considered whether the provisions for the
tax services and other services by Hogan were compatible with maintaining their
independence and determined that they were.
Fees
Incurred by the Company for services performed by audit firms
The
following table shows the fees for professional services provided by Hogan
and
by Tullius for the audits of our annual financial statements for the years
ended
September 30, 2007 and 2006 and fees billed for other services during those
periods.
|
2007
Hogan
|
2006
Hogan Tullius
|
|
Audit
Fees(1)
|
$ 80,000
|
$ 71,500
|
8,600
|
Audit-Related
Fees(2)
|
1,045
|
3,600
|
3,000
|
Tax
Fees(3)
|
22,805
|
18,620
|
-
|
All
Other Fees(4)
|
10,426
|
-
|
-
|
Total
|
$
114,276
|
$ 93,720
|
11,600
|
Notes
to
Table:
1)
|
Audit
fees represent fees for professional services provided in connection
with
the audit of our financial statements and review of our quarterly
financial statements and audit services provided in connection with
the
issuance of comfort letters, consents, and assistance with review
of
documents filed with the SEC.
|
2)
|
Audit
related fees for reimbursements of travel and other costs associated
with
Audit services
|
3)
|
Tax
Fees are for annual tax return preparation and research of tax related
matters
|
4)
|
Other
fees represent annual audit of the Company’s Defined Contribution Plan as
well as other services associated with an S-3 filing during fiscal
2007.
|
Policy
on Audit
Committee Pre-Approval of Audit and Permissible Non-Audit Services of
Independent Auditor
Consistent
with SEC policies regarding auditor independence, the Audit Committee has
responsibility for appointing, setting compensation and overseeing the work
of
the independent registered public accounting firm. In recognition of this
responsibility, the Audit Committee has established a policy to pre-approve
all
audit and permissible non-audit services provided by the independent registered
public accounting firm. During the year the Audit Committee approved all of
the
services performed by the independent accounting firms. The fees
billed for these services approximated 100% of the pre-approved
amounts.
Before
engagement of the independent registered public accounting firm for the next
year’s audit, management will submit a list of services and related fees
expected to be rendered during that year within each of the following four
categories of services to the Audit Committee for approval:
1.
|
Audit
services include audit work performed on the financial statements,
internal control over financial reporting, as well as work that generally
only the independent registered public accounting firm can reasonably
be
expected to provide, including comfort letters, statutory audits,
and
discussions surrounding the proper application of financial accounting
and/or reporting standards.
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2.
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Audit-Related
services are for assurance and related services that are
traditionally performed by the independent registered public accounting
firm, including due diligence related to mergers and acquisitions,
employee benefit plan audits, and special procedures required to
meet
certain regulatory
requirements.
|
3.
|
Tax
services include all services, except those services specifically
related to the audit of the financial statements, performed by the
independent registered public accounting firm’s tax personnel, including
tax analysis; assisting with coordination of execution of tax related
activities, primarily in the area of corporate development; supporting
other tax related regulatory requirements; and tax compliance and
reporting.
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4.
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Other
Fees are those associated with services not captured in the other
categories. We generally don’t request such services from the independent
registered public accounting
firm.
|
Before
engagement, the Audit Committee pre-approves the independent registered public
accounting firm’s services within each category. During the year,
circumstances may arise when it may become necessary to engage the independent
registered public accounting firm for additional services not contemplated
in
the original pre-approval categories. In those instances, the Audit Committee
requires specific pre-approval before engaging the independent registered public
accounting firm.
The
Audit Committee
may delegate pre-approval authority to one or more of its members. The member
to
whom such authority is delegated must report, for informational purposes only,
any pre-approval decisions to the Audit Committee at its next scheduled
meeting.
If
you
want to include a shareholder proposal in the proxy statement for the 2009
annual meeting, it must be delivered to our executive offices, 1221 East
Houston, Broken Arrow, Oklahoma, 74012, on or before October 3,
2008. In addition, if you wish to present a proposal at the 2008
annual meeting that will not be included in our proxy statement and you fail
to
notify us by December 17, 2008, then the proxies solicited by our Board for
the
2009 annual meeting will include discretionary authority to vote on your
proposal in the event that it is properly brought before the
meeting.
At
the
date of mailing of this proxy statement, we are not aware of any business to
be
presented at the annual meeting other than the proposal discussed
above. If other proposals are properly brought before the meeting,
any proxies returned to us will be voted as the proxyholders see
fit.
Only
one
annual report and proxy statement are being delivered to multiple shareholders
who share one address, unless we have received instructions to the
contrary. We will provide a separate copy of the annual report and
proxy statement to a shareholder at a shared address to which single copies
were
delivered upon request sent in writing to ADDvantage Technologies Group, Inc.,
c/o Shareholder Relations, 1221 East Houston, Broken Arrow, Oklahoma, 74012,
or
by calling (918) 251-9121. If you wish to receive a separate annual
report and proxy statement in the future, or if you currently receive multiple
copies of the annual report and proxy statement and wish to request delivery
of
only single copies, you may notify us at the same address or phone
number.
You
can obtain a copy of our Annual Report on Form 10-K for the year ended September
30, 2007 at no charge by sending your request in writing to ADDvantage
Technologies Group, Inc., c/o Daniel E. O'Keefe, Vice President, Chief Financial
Officer and Secretary, 1221 East Houston, Broken Arrow, Oklahoma,
74012. This document and other information may also be accessed
from our website at www.addvantagetech.com.
PROXY
ADDVANTAGE
TECHNOLOGIES GROUP, INC.
THIS
PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The
undersigned hereby appoints Kenneth A. Chymiak, and David E. Chymiak, as
proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated below, all the shares of Common
Stock of ADDvantage Technologies Group, Inc. (the “Company”) held of record by
the undersigned on January 17, 2008 at the Annual Meeting of Shareholders of
the
Company to be held on March 6, 2008, and at any and all adjournments or
postponements thereof.
1. Election
of directors.
¨
|
FOR
all nominees listed below (except as indicated to the contrary below
and
subject to the discretion of the proxies as provided
herein).
|
Kenneth
A.
Chymiak David
E.
Chymiak Thomas
J.
Franz Paul
F.
Largess James
C.
McGill
Daniel
E.
O’Keefe Stephen
J.
Tyde
¨
|
WITHHOLD
AUTHORITY to vote for all the nominees
above.
|
Instructions: To
withhold authority for any individual nominee or nominees, write their name(s)
here:
2. Proposal
to ratify the appointment of Hogan & Slovacek as our independent
auditors.
¨
FOR
¨
AGAINST
¨
ABSTAIN
3. In
their discretion, the Proxies are authorized to vote upon such other business
as
may properly come before the meeting.
This
Proxy when properly executed will be voted at the Annual Meeting or any
adjournments or postponements thereof as directed herein by the undersigned
shareholder. If no specifications are made, this Proxy will be voted
For
Proposals 1 and 2. This Proxy is revocable at any time before it is
exercised.
IMPORTANT: Please
date this and sign this Proxy exactly as name appears to the left. If
shares are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please give title as
such. If a corporation, please sign in full corporate name by
president or other authorized officer. If a partnership, please sign
in partnership name by authorized person.
Dated: ,
2008
Signature(s)
Signature(s)
PLEASE
MARK, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
ENVELOPE.
NO
POSTAGE IS REQUIRED FOR MAILING IN THE UNITED STATES.