SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
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Emtec, Inc.
(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):
[X] 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:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Copies of all communications to:
Ira Roxland, Esq.
Sonnenschein Nath & Rosenthal LLP
1221 Avenue of the Americas
New York, New York 10020
(212) 768-6700
EMTEC, INC.
572 Whitehead Road
Trenton, New Jersey 08619
------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 7, 2005
------------------
Dear Stockholders,
On Monday, March 7, 2005, Emtec, Inc. will hold its Annual Meeting of
Stockholders at the Courtyard Marriott Hotel, 260 Scotch Road, Ewing, New Jersey
08628. The meeting will begin at 11:00 a.m.
At the meeting we will:
o Elect one director to Class A of the Board of Directors to serve
for a three year term;
o Elect one director to Class B of the Board of Directors to serve
for a one year term; and
o Attend to any other business properly brought before the meeting.
Only stockholders of record at the close of business on February 4,
2005 are entitled to vote at the annual meeting. Whether or not you plan to
attend the annual meeting, please sign and date the enclosed proxy, which is
solicited by our board of directors, and promptly return it in the pre-addressed
envelope provided for that purpose. Any stockholder may revoke his or her proxy
at any time before the annual meeting by giving written notice to such effect,
by submitting a subsequently dated proxy or by attending the annual meeting and
voting in person.
/s/ Rosemary Howlett
----------------------
Rosemary Howlett,
Secretary
Trenton, New Jersey
February 4, 2005
EMTEC, INC.
572 Whitehead Road
Trenton, New Jersey 08619
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PROXY STATEMENT
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TABLE OF CONTENTS
Page
----
Questions and Answers................................................................1
The Proposal You May Vote On.........................................................3
Stock Ownership......................................................................6
Executive Compensation...............................................................8
Certain Relationships and Related Transactions.......................................10
Performance Graph....................................................................10
Independent Auditors.................................................................11
Stockholder Proposals for the 2005 Annual Meeting....................................12
-i-
QUESTIONS AND ANSWERS
Q: WHO IS SOLICITING MY VOTE?
A: This proxy solicitation is being made by Emtec, Inc. Proxies are being
solicited by mail, and all expenses of preparing and soliciting such
proxies will be paid by us.
Q: WHEN WAS THE PROXY STATEMENT MAILED TO STOCKHOLDERS?
A: This proxy statement was first mailed to stockholders on or about
February 7, 2005.
Q: WHAT MAY I VOTE ON?
A: The election of one director to Class A of the Board of Directors to
serve for a three year term; and the election of one director to Class
B of the Board of Directors to serve for a one year term.
Q: HOW DOES THE BOARD RECOMMEND I VOTE ON THIS PROPOSAL?
A: The Board recommends a vote FOR the nominees.
Q: WHO IS ENTITLED TO VOTE?
A: Stockholders as of the close of business on February 4, 2005 (the Record
Date) are entitled to vote at the Annual Meeting.
Q: HOW DO I VOTE?
A: Sign and date each proxy card you receive and return it in the prepaid
envelope. If you return your signed proxy card but do not mark the boxes
showing how you wish to vote, your shares will be voted FOR each of the
nominees. You have the right to revoke your proxy at any time before the
meeting by:
(1) notifying our President and Chief Operating Officer, Ronald A. Seitz,
at our address shown above;
(2) voting in person at the Annual Meeting; or
(3) returning a later-dated proxy card.
Q: WHAT IF MY SHARES ARE HELD THROUGH A BANK OR BROKER:
A: Stockholders who hold their shares through a bank or broker can also vote
via the Internet if this option is offered by the bank or broker.
Q: WHO WILL COUNT THE VOTE?
A: Representatives of our transfer agent, Zions Bank, will count the votes.
Q: IS MY VOTE CONFIDENTIAL?
A: Proxy cards, ballots and voting tabulations that identify individual
stockholders are mailed or returned directly to Zions Bank, and handled
in a manner that protects your voting privacy. Your vote will not be
disclosed except (1) as needed to permit Zions Bank to tabulate and
certify the vote, and (2) as required by law. Additionally, all comments
written on the proxy card or elsewhere will be forwarded to management.
Your identity will be kept confidential unless you ask that your name be
disclosed.
Q: HOW MANY SHARES CAN VOTE?
A. As of February 4, 2005, 7,380,498 shares of common stock were issued and
outstanding. Every holder of common stock is entitled to one vote for
each share held.
Q: WHAT IS A QUORUM?
A: A "quorum" is a majority of the outstanding shares of our common stock
entitled to vote on February 4, 2005. These shares must be present at the
meeting, in person or by proxy, for the meeting to be held for the
transaction of business.
If you submit a properly executed proxy card, even if you abstain from
voting, then you will be considered part of the quorum. Broker not-votes
are abstention by brokers who have proxies that do not have specific
voting instructions from their beneficial owners of the shares they hold.
Broker non-votes will be counted as part of the quorum.
Q: HOW MANY VOTES ARE REQUIRED FOR THE APPROVAL OF THE NOMINEES?
A: Directors will be elected by a plurality of the votes cast at the
meeting.
Q: WHO CAN ATTEND THE ANNUAL MEETING:
A: All stockholders on February 4, 2005 can attend. If your shares are held
through a broker and you'd like to attend, please bring a copy of your
brokerage account statement or an omnibus proxy (which you can get from
your broker), and we will permit you to attend the meeting.
Q: HOW WILL VOTING ON ANY OTHER BUSINESS BE CONDUCTED?
A: We do not know of any business to be considered at the Annual Meeting
other than the proposals described in this proxy statement. If any other
business is presented at the Annual Meeting, your signed proxy card gives
authority to John P. Howlett, our chairman, and Ronald A. Seitz, our
President and Chief Operating Officer, to vote on such matters at their
discretion.
Q: WHO ARE THE LARGEST PRINCIPAL STOCKHOLDERS?
A: As of February 4, 2005 John P. Howlett owned 1,400,910 shares of our
common stock (19.0%), Ronald A. Seitz owned 829,519 shares (11.2%), Tom
Dresser owned 1,029,774 shares (14.0%), Richard Landon owned 984,774
shares (13.3%) and Carla Seitz owned 782,707 shares(10.6%).
-2-
THE PROPOSAL YOU MAY VOTE ON
ELECTION OF DIRECTORS
Our Board of Directors currently has four directors, divided into two
classes. Three of the directors are class A directors and one of the directors
is a class B director. One class A director and one class B director are to be
elected at this meeting. Each of the class A directors serves for a term of
three years or until his successor is elected and qualified and the class B
director serves for a term of one year or until his successor is elected and
qualified.
Mr. Jerd and Mr. Raymond have indicated that they will serve if
elected. We do not anticipate that any of them will be unable to stand for
election. If that occurred, the Board would designate a substitute. If a
substitute were designated, proxies voting on the original director candidate
would be cast for the substituted candidate.
Information about the Nominees
Nominee for election to the Board of Directors for a three-year term expiring in
2008.
R. Frank Jerd Director since January 2001
R. Frank Jerd, age 62, was appointed as a director upon the
consummation of our merger with Emtec-NJ on January 17, 2001. Mr. Jerd is, and
has been, chief executive officer of Viecore FSD Corporation, a software
development company, since May 2002. From 1994 to May 2002, he was a technology
consultant for Montauk Capital in New York. He was CEO of Gandalf Systems
Corporation from 1993 to 1994. From 1992 to 1993, he was chief executive officer
of Benesys, Inc., a medical software company. Mr. Jerd earned a Bachelor of
Science Degree in Mathematics at Marshall University.
Nominee for election to the Board of Directors for a one-year term expiring in
2006.
George F. Raymond Director since August 2002
George F. Raymond, age 67, has been our director since August 22, 2002.
Mr. Raymond has been retired from active employment since 1989. Since his
retirement, he has worked as a consultant to the information technology
industry. In 1972, Mr. Raymond founded Automatic Business Centers, Inc., a
payroll process service company and served as its president until its sale to
Automatic Data Processing in 1989. In 1965 he co-founded Computer Services Inc,
a general purpose data processing service company, which was purchased by
Management Data Corp. in 1969. Mr. Raymond served as the president of Computer
Services Inc. until 1972. Prior thereto, Mr. Raymond was a management consultant
with Touche Ross & Co. from 1961 to 1965. Currently Mr. Raymond serves on the
Board of directors of five companies, three of which are publicly traded. The
publicly traded companies are BMC Software, DocuCorp International and
NationsHelath Inc.
Board Recommendation
You may vote for or withhold from voting on this matter. Assuming a
quorum is present, directors will be elected by a plurality of the votes cast at
the meeting.
-3-
YOUR BOARD UNANIMOUSLY RECOMMENDS A VOTE FOR THE ELECTION OF R. FRANK
JERD AS A CLASS A DIRECTOR AND FOR THE ELECTION OF GEORGE F. RAYMOND AS A CLASS
B DIRECTOR.
Current Directors Whose Terms expire in 2006
John P. Howlett, age 60, has served as our Chairman of the Board and
Chief Executive Officer since January 17, 2001 and Chief Executive Officer of
Emtec-NJ since August, 1997 and Chairman of Emtec-NJ since August, 1998. He has
been a director of Emtec-NJ since October, 1996. Mr. Howlett was the founder (in
1983) of Cranford, New Jersey-based Comprehensive Business Systems, Inc. (CBSI).
CBSI primarily provided microcomputer systems, network integration, training,
and data communications to mid-size and Fortune 1000 corporations. In October
1996, CBSI merged into Emtec-NJ. Prior to founding CBSI, Mr. Howlett was with
the AT&T Long Lines Division for twelve years. He earned a Bachelor of Science
degree in Electrical Engineering from Rose Hulman Institute of Technology in
Terre Haute, Indiana, and a Master of Business Administration degree from
Fairleigh Dickinson University in New Jersey. A Vietnam veteran, Mr. Howlett
served in the U.S. Army for four years.
Ronald A. Seitz, age 57, has been our President and Chief Operating
Officer since February 2003 and Executive Vice-President and a director since
January 17, 2001 and Executive Vice President of Emtec-NJ since March, 1996.
From April 1995 to March 1996 he was the Chief Operating Officer of Emtec-NJ. He
has been a director of Emtec-NJ since April, 1995. Mr. Seitz was the founder (in
1980) of Charleston, South Carolina-based Computer Source, Inc. (CSI). CSI
primarily provided microcomputer systems, network integration, and data
communications to mid-size and Fortune 1000 corporations. In April 1995, CSI
merged with Landress Information Systems of Mt. Laurel, New Jersey to become
Emtec-NJ. Prior to founding CSI, Mr. Seitz was employed for six years as an
engineer with the U.S. government in Washington, DC. He graduated from North
Carolina State University with a Bachelor of Science degree and from George
Washington University with an MBA in computer science. Mr. Seitz also holds a
DMD degree from the Dental School at the Medical University of South Carolina.
Board and Committee Meetings
Our business is managed under the direction of the Board of Directors.
The Board delegates the conduct of business to the Company's senior management
team.
Our Board usually meets four times a year in regularly scheduled
meetings. It may meet more often if necessary. The Board held five meetings in
fiscal 2004. Each director attended all of the meetings. The Chairman usually
determines the agenda for the meetings. Board members receive the agenda and
supporting information in advance of the meetings. Board members may also raise
other matters at the meetings.
Since we are not a listed company, we are not required to establish an
audit committee. Our board of directors believes it can conduct all of the
functions of an audit committee without unduly burdening the duties and
responsibilities of the board members. Our board of directors has determined
that Mr. George F. Raymond, an independent member of our board of directors,
meets the SEC definition of an "audit committee financial expert."
Our Board of Directors has adopted a Code of Ethics applicable to all
of its employees, including its Principal Executive Officer, Principal Financial
Officer and Principal Accounting Officer, as well as the members of its board of
directors.
-4-
Currently, there is no compensation committee. The members of the
entire board deliberate and decide compensation. Neither Mr. Jerd nor Mr.
Raymond is or has been an employee or an officer of our company. Mr. Howlett is
our Chairman, and Chief Executive Officer, and Mr. Seitz is our President and
Chief Operating Officer.
We do not have a nominating committee as the board has determined,
given its relatively small size, to perform this function as a whole. We do not
currently have a charter or written policy with regard to the nomination
process. At this time, we do not have a formal policy with regard to the
consideration of any director candidates recommended by our stockholders because
historically we have not received recommendations from our stockholders.
Qualifications for consideration as a board nominee may vary according
to the particular areas of expertise being sought as a complement to the
existing board composition. However, in making its nominations, the board of
directors considers, among other things, an individual's business experience,
industry experience, breadth of knowledge about issues affecting our company,
time available for meetings and consultation regarding company matters and other
particular skills and experience possessed by the individual.
Any shareholder recommendation of a director candidate should include
the candidate's name, biographical data and a detailed description of the
candidate's qualifications for board membership, and should be sent to Emtec,
Inc. 572 Whitehead Road, Trenton, New Jersey 08619, Attention: John P. Howlett.
Any shareholder recommendations must be submitted in sufficient time for an
appropriate evaluation by the board.
Stockholder Communication with Board Members
We maintain contact information for stockholders, both telephone and
email, on our website (www.emtecinc.com) under the heading "About Us -- Investor
Relations." By following the link, a stockholder will be given access to our
telephone number and mailing address as well as a link for providing email
correspondence to Investor Relations. Communications sent to Investor Relations
and specifically marked as a communication for our Board will be forwarded to
the Board or specific members of the Board as directed in the stockholder
communication. In addition, communications received via telephone or mail for
the Board are forwarded to the Board by one of our officers.
Board Member Attendance at Annual Meetings
Our Board of Directors does not have a formal policy regarding
attendance of directors at our annual stockholder meetings. All directors
attended our 2003 annual meeting of stockholders except R. Frank Jerd and George
F. Raymond.
Director Compensation
Non-employee directors receive annual compensation of $10,000.
Directors also receive stock options at the discretion of the Board.
Non-employee directors receive reimbursement of out-of-pocket expenses incurred
for each board meeting or committee meeting attended.
-5-
STOCK OWNERSHIP
Stock Ownership of Certain Beneficial Owners and Management
The following table shows, as of February 4, 2005, the beneficial
ownership of shares of our common stock held by each of our directors and named
executive officers, by each person known by us to be the owner of 5% or more of
our common stock and by all current directors and executive officers as a group.
The table also includes shares issuable upon exercise of options or warrants
shares that are currently exercisable or will be exercisable within 60 days of
February 4, 2005.
Name and Address of Amount and Percentage of Beneficial
Beneficial Owner(1) Ownership(2)
---------------------------------------------------- -----------------------------------
John P. and Rosemary A. Howlett 1,400,910 19.0%
Ronald A. Seitz 829,519(3) 11.2%
Sam Bhatt 27,631(5) .4%
R. Frank Jerd 74,630(6) 1.0%
George F. Raymond 60,000(7) .8%
Tom Dresser 1,029,774 14.0%
3505 S. Ocean Boulevard
Hollywood, FL 33019
Richard Landon 984,774 13.3%
142 York Road
Delran, NJ 08075
Carla Seitz 782,707(4) 10.6%
P.O. Box 2243
Mt. Pleasant, SC 29465
All executive officers and directors as a group 3,175,397(8) 42.2%
(5 persons)
(1) Each stockholder's address is c/o Emtec, 572 Whitehead Road, Bldg#1,
Trenton, New Jersey, 08619, unless otherwise indicated.
(2) As used herein, beneficial ownership means the sole or shared power to
vote, or direct the voting of, a security, or the sole or shared power
to invest or dispose, or direct the investment or disposition, of a
security. Except as otherwise indicated, all persons named herein have
(i) sole voting power and investment power with respect to their
shares, except to the extent that authority is shared by spouses under
applicable law and (ii) record and beneficial ownership with respect to
their shares; also includes any shares issuable upon exercise of
options or warrants that are currently exercisable or will become
exercisable within 60 days after February 4, 2005.
(3) Excludes 782,707 shares owned by Carla Seitz, Mr. Seitz's spouse. Mr.
Seitz disclaims any beneficial interest in these shares.
(4) Excludes 829,519 shares owned by Ronald A. Seitz, Mrs. Seitz's spouse.
Mrs. Seitz disclaims any beneficial ownership in these shares.
(5) Includes 4,877 shares issuable upon the exercise of options.
(6) Includes 74,630 shares issuable upon the exercise of options.
(7) Includes 60,000 shares issuable upon the exercise of options.
(8) Includes 139,507 shares issuable upon the exercise of options
-6-
Compliance with Section 16(a) of the Exchange Act of 1934
Section 16(a) of the Exchange Act requires our directors and executive
officers and persons who own beneficially more than 10% of our common stock to
file reports of ownership and changes in ownership of such common stock with the
Securities and Exchange Commission, and to file copies of such reports with us.
Based solely upon a review of the copies of such reports filed with us, we
believe that during the fiscal year ended March 31, 2004, such reporting persons
complied with the filing requirements of said Section 16(a), except that Mr. Guy
Fessenden was not timely in the filing of his Initial Statement of Beneficial
Ownership of Securities.
-7-
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the aggregate compensation that we paid
for services rendered to us in all capacities during our fiscal years ended
March 31, 2004, 2003 and 2002 by our chief executive officer and by our other
executive officers whose cash compensation exceeded $100,000 per year in any
such year.
Summary Compensation Table
Long Term Compensation
---------------------------------------------------
Annual Compensation Awards Payouts
----------------------- ----------------------- --------
Long
Restricted Term All
Name and Fiscal Other Annual Stock Number of Incentive Other
Principal Position Year Salary Bonus Compensation Awards Options Payouts Compensation
------------------ ---- ------ ----- ------------ ------ ------- ------- ------------
John P. Howlett 2004 $ 216,300 -- -- -- -- -- $16,173(1)
- Chief Executive 2003 $ 212,000 -- -- -- -- -- $18,553(1)
- Officer 2002 $ 204,000 -- -- -- -- -- $16.750(1)
Ronald A. Seitz
- Chief Operating 2004 $ 216,300 -- -- -- -- -- --
Officer 2003 $ 212,000 -- -- -- -- -- $ 6,642(2)
-and President. 2002 $ 204,000 -- -- -- -- -- $ 6,704(2)
Sam Bhatt 2004 $ 128,757 -- -- -- -- -- --
-Vice President 2003 $ 120,000 -- -- -- -- -- --
-Finance 2002 $ 114,545 -- -- -- -- -- --
Guy Fessenden
-Executive Vice- 2004 $ 176,154 -- $17,500(3) -- -- -- --
President 2003 $ 150,000 -- $83,330(3) -- -- -- --
------------------
(1) Reflects employer contributions for life insurance premiums and for
disability insurance premiums.
(2) Reflects employer contribution for life insurance premiums.
(3) Reflects paid commissions during fiscal 2004 and 2003.
-8-
Stock Option Grants During Fiscal Year 2003
None of the named executive officers listed in the Summary Compensation
Table were granted stock options during the fiscal year ended March 31, 2004.
Set forth below is information with respect to unexercised options held
by our named executive officers to purchase our common stock.
Aggregated Option Exercises in Fiscal Year 2004
and Fiscal Year End Option Values
Number of Unexercised
Number of Securities Underlying Options Value of Unexercised
Shares at March 31, 2004 In-the-Money Options
Acquired on Value ----------------------------- ----------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
----------------------- ----------- -------- -------------- ------------- ----------- -------------
John P. Howlett......... -- $ 0 0 0 $ 0 $ 0
Ronald A. Seitz........ -- $ 0 0 0 $ 0 $ 0
Sam Bhatt............... -- $ 0 14,750 1,250 $ 0 $ 0
Guy Fessenden -- $ 0 0 0 $ 0 $ 0
Compensation Committee Interlocks and Insider Participation
Currently, there is no compensation committee. The members of the
entire board deliberate and decide compensation. Neither Mr. Jerd nor Mr.
Raymond is or has been an employee or an officer of our company. Mr. Howlett is
our Chairman and Chief Executive Officer, and Mr. Seitz is our President and
Chief Operating Officer.
Report of the Board Regarding Executive Compensation
The Board as a whole meets to discuss executive compensation. For FY2005, the
Board determined that increases to executive compensation should conform to
recommendations received from our consultant, Compensation Consulting
Alternatives. CCA has gathered average compensation data for the Computer
Software/Services Industry that had been publicly released by Mercer's US
Compensation Planning Survey, World at Work's Salary Budget Survey as well as
Compensation Resource's Compensation Planning Survey. Based on CCA's report,
increases in executive compensation for FY2005 were set at rates not to exceed
4% of base salary. The board also recommended reinstating a management bonus
plan once earnings had returned to budgeted levels.
February 3, 2005 Board of Directors
John P. Howlett
Ronald A. Seitz
R. Frank Jerd
George F. Raymond
-9-
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There are no relationships or related party transactions of a nature
required to be disclosed hereunder.
PERFORMANCE GRAPH
The following graph illustrates the cumulative total shareholder return
(rounded to the nearest whole dollar) of our common stock during the period from
January 17, 2001 -- the date on which we acquired Emtec, Inc., a New Jersey
corporation, and commenced our current business -- through March 31, 2004 and
compares it to the cumulative total return on (i) the Nasdaq Composite Index and
(ii) the Peer Group Index (capitalization weighted). The comparison assumes a
$100 investment on January 17, 2001 in our common stock and in each of the
foregoing indices and assumes reinvestment of dividends, if any. This table is
not intended to forecast future performance of our common stock.
EMTEC, INC.
RELATIVE MARKET PERFORMANCE
TOTAL RETURN JANUARY 17, 2001 - MARCH 31, 2004
[PERFORMANCE GRAPH]
1/17/2001 3/31/2001 3/31/2002 3/31/2003 3/31/2004
EMTEC, INC. $ 100.00 $ 61.32 $ 43.48 $ 21.01 $ 97.83
NASDAQ STOCK MARKET (U.S.) $ 100.00 $ 68.60 $ 68.78 $ 49.99 $ 74.33
PEER GROUP $ 100.00 $ 85.21 $ 107.21 $ 38.19 $ 114.58
(1) Graph assumes $100 invested on January 17, 2001 in the Company's Common
Stock, the Nasdaq Composite Index and the Peer Group Index (capitalization
weighted).
(2) Cumulative total return assumes reinvestment of dividends, if any.
(3) The Company has constructed a Peer Group Index consisting of other computer
systems integrators that also provide information technology consulting services
to their clients, including CompuCom Systems, Inc., Datatec Systems, Inc.,
Alphanet Solutions, Inc., Micros-to-Mainframes, Inc., Pomeroy Computer
Resources, Inc., and TransNet Corporation. The Company believes that these
companies most closely resemble the Company's business mix and that their
performance is representative of the industry.
-10-
INDEPENDENT AUDITORS
Baratz & Associates, P.A. ("BA") was retained as our independent
auditors for our fiscal year ended March 31, 2004. A representative of BA is
expected to attend the Annual Meeting. He or she will have the opportunity to
speak at the meeting and will also respond to appropriate questions.
The following table sets forth the aggregate fees incurred by us for
the fiscal year ended March 31, 2004 and 2003 to our principal auditing firm:
2004 2003
---- ----
Audit Fees ....... $ 86,000 $ 86,000
Audit Related Fees $ 500 $ 7,000
Tax Fees ......... $ 20,000 $ 16,000
All Other Fees ... $ 7,000 $ 7,000
-------- ---------
Total ............ $113,500 $116,000
======== =========
Audit Fees: The Audit Fees billed by BA for the fiscal years ended
March 31, 2004 and March 31, 2003, respectively, were for professional services
rendered for the audits of the financial statements of the Company, quarterly
reviews, and assistance with the review of documents filed with the Securities
and Exchange Commission.
Audit Related Fees: The Audit Related Fees for the fiscal years ended
March 31, 2004 and March 31, 2003, respectively, were for attendance at the
annual stockholders meeting, and were for the advice and guidance on the Form
8-K filings concerning the acquisitions of Acentra Technologies, Inc. and
Turnkey Computer Systems.
Tax Fees: The Tax Fees billed by BA for the fiscal years ended March
31, 2004 and March 31, 2003, respectively, were for services performed in
connection with income tax compliance.
All Other Fees: All Other fees billed by BA for the fiscal years ended
March 31, 2004 and March 31, 2003, respectively, were for professional services
rendered for the 401K audit.
Our board of directors has adopted a policy that requires advance approval of
all audit, audit-related, tax services, and other services performed by our
independent auditor. The policy provides for pre-approval by the board of
directors of specifically defined audit and non-audit services. Unless the
specific service has been previously pre-approved with respect to that year, the
board of directors must approve the permitted service before the independent
auditor is engaged to perform it.
-11-
STOCKHOLDER PROPOSALS FOR THE 2005 ANNUAL MEETING
Under SEC rules, stockholders intending to present a proposal at the
2005 Annual Meeting and have it included in our proxy statement must submit the
proposal in writing to Ronald A. Seitz, President and Chief Operating Officer,
Emtec, Inc., 572 Whitehead Road, Trenton, New Jersey 08619. We must receive the
proposal no later than October 7, 2005.
-12-
APPENDIX 1
EMTEC, INC.
2004 ANNUAL MEETING OF STOCKHOLDERS
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints John P. Howlett and Ronald A. Seitz as proxies,
each with the power to appoint his substitute, and hereby authorizes them, and
each of them, to vote all shares of common stock of Emtec, Inc. (the "Company")
held of record by the undersigned on February 4, 2005, at the 2004 Annual
Meeting of Stockholders, to be held at the Courtyard Marriott Hotel, 260 Scotch
Road, Ewing, New Jersey 08628, on Monday, March 7, 2005 at 11:00 a.m., or any
adjournment or postponement thereof.
When properly executed, this proxy will be voted in the manner directed herein
by the undersigned stockholder. If no direction is given, this proxy will be
voted "for" each of the proposals set forth on the reverse side
(Continued and to be Completed on Reverse Side.)
[X] Please mark
your votes as
indicated in
this example
1. Election of Directors:
FOR WITHHELD
Nominee From Nominee Nominee: R. Frank Jerd (3 year term)
[ ] [ ]
FOR WITHHELD
Nominee From Nominee Nominee: George F. Raymond (1 year term)
[ ] [ ]
2. To transact such other business as may properly come before the meeting.
Yes, I plan to attend the 2004 Annual Stockholders Meeting [ ]
Please sign exactly as name appears hereon. Joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full 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 an authorized person.
Dated:_____________________________, 2005
-----------------------------------------
Signature
-----------------------------------------
Signature
PLEASE SIGN, DATE AND RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE.