SCIENTIFIC INDUSTRIES INC
10-Ks and 10-Qs
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UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment
No.___)
Filed
by the Registrant
☒
Filed
by a Party other than the Registrant
☐
Check
the appropriate box:
☐
Preliminary Proxy Statement
☐
Confidential, for Use of the Commission Only (As
Permitted by Rule 14a-6(e) (2))
☒
Definitive Proxy Statement
☐
Definitive Additional Materials
☐
Soliciting Material Pursuant to Section
240.14a-12
SCIENTIFIC INDUSTRIES, INC.
(Name of Registrant as Specified In Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment
of Filing Fee (Check the appropriate box):
☒
No fee required.
☐
Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
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(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 (set forth the amount on which
the filing fee is calculated and state ho it was
determined):
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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.
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(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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December
6, 2019
Dear
Fellow Stockholders:
You are
cordially invited to attend the 2019 Annual Meeting of Stockholders
of Scientific Industries, Inc. which will be held at 11:00 a.m.
(New York time) on Wednesday, January 29, 2020 at La Quinta Inn
& Suites, 10 Aero Road, Bohemia, New York, 11716.
Information
concerning the matters to be considered and voted upon at the
Annual Meeting is set out in the attached Notice of 2019 Annual
Meeting of Stockholders and Proxy Statement.
It is
important that your shares be represented at the 2019 Annual
Meeting, regardless of the number of shares you hold and whether or
not you plan to attend the meeting in person. Accordingly, please
complete, sign and date the enclosed proxy card and return it as
soon as possible in the accompanying business reply envelope so
that your shares will be represented at the Annual Meeting. This
will not limit your right to vote in person or to attend the
meeting.
Thank
you for your continued support.
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Sincerely,
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/s/
Joseph G. Cremonese
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Joseph
G. Cremonese
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Chairman
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2
SCIENTIFIC INDUSTRIES, INC.
80 Orville Drive, Suite 102
Bohemia, New York 11716
_____________
NOTICE OF 2019 ANNUAL MEETING OF STOCKHOLDERS
January 29, 2020
Notice
is hereby given that the 2019 Annual Meeting of Stockholders (the
“Annual Meeting”) of Scientific Industries, Inc., a
Delaware corporation (the "Company"), will be held on Wednesday,
January 29, 2020, at 11:00 a.m. (New York time) at La Quinta Inn
& Suites, 10 Aero Road, Bohemia, New York, 11716, for the
following purposes:
1.
To elect two Class
B Directors to the Company's Board of Directors to serve until the
Company’s annual meeting of stockholders with respect to the
year ending June 30, 2022 and the election and qualification of
their respective successors.
2.
To
consider and act upon a proposal to approve the amendment to the
2012 Stock Option Plan of the Company.
3.
To
ratify the appointment of Nussbaum Berg Klein & Wolpow, CPAs
LLP as the Company’s independent registered public accounting
firm for the fiscal year ending June 30, 2020.
4.
To transact such
other business as may properly come before the Annual Meeting and
any adjournments or postponements thereof.
The
foregoing items of business are more fully described in the
accompanying proxy statement.
The
Board of Directors has fixed the close of business on December 2,
2019, as the record date for determination of stockholders entitled
to notice of and to vote at, the Annual Meeting and at any
adjournments or postponements thereof.
A
complete list of the stockholders entitled to vote at the Annual
Meeting will be available for inspection by any stockholder of the
Company at the Annual Meeting. In addition, the list will be open
for examination by any stockholder of the Company for any purpose
germane to the Annual Meeting during ordinary business hours for a
period of ten days prior to the Annual Meeting at the offices of
the Company.
You are requested to fill in and sign the
enclosed form of proxy, which is being solicited by the Board of
Directors of the Company, and mail it promptly in the enclosed
postage paid envelope. Any proxy may be revoked by delivery of a
later dated proxy
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By
Order of your Board of Directors,
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/s/
Robert .P. Nichols
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Robert
P. Nichols
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Secretary
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Bohemia,
New York
December
6, 2019
WHETHER
OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, WE KINDLY REQUEST
THAT YOU PLEASE COMPLETE, SIGN, DATE, AND PROMPTLY RETURN THE
ENCLOSED PROXY CARD IN THE POSTAGE PAID ENVELOPE PROVIDED. IF YOU
ARE A STOCKHOLDER OF RECORD AND YOU ATTEND THE ANNUAL MEETING, YOU
MAY VOTE IN PERSON IF YOU WISH, EVEN IF YOU HAVE PREVIOUSLY
RETURNED YOUR PROXY CARD.
YOUR VOTE IS IMPORTANT
3
SCIENTIFIC INDUSTRIES, INC.
80 Orville Drive, Suite 102
Bohemia, New York 11716
PROXY STATEMENT
_________________
2019 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JANUARY 29, 2020
_________________
Solicitation of Proxies
This
proxy statement is furnished in connection with the solicitation of
proxies by and on behalf of the Board of Directors (the
“Board”) of Scientific Industries, Inc., a Delaware
corporation (the "Company"), for use at the 2019 Annual Meeting of
Stockholders (the "Annual Meeting") to be held at La Quinta Inn
& Suites, 10 Aero Road, Bohemia, New York, 11716, on Wednesday,
January 29, 2020, at 11:00 a.m. (New York time), and at any
adjournments or postponements thereof.
At the
Annual Meeting, stockholders of the Company will be asked to: (1)
elect two Directors of the Company to serve until the
Company’s annual meeting of stockholders with respect to the
fiscal year ending June 30, 2022, and the election and
qualification of their successors; (2) approve the amendment to the
2012 Stock Option Plan of the Company; (3) ratify the appointment
of Nussbaum Berg Klein & Wolpow CPAs LLP, as the
Company’s independent registered public accounting firm for
the fiscal year ending June 30, 2020; and (4) transact such other
business as may properly come before the Annual Meeting and any
adjournments or postponements thereof.
Record Date, Voting Rights
Only
stockholders of record of the Company’s Common Stock, par
value $0.05 per share (the “Common Stock”), as of the
close of business on December 2, 2019 (the "Record Date"), are
entitled to notice of and to vote at the Annual Meeting and any
adjournments or postponements thereof. On the Record Date, there
were 1,522,575 shares of Common Stock issued and 1,502,773
outstanding. Each share of Common Stock is entitled to one
vote.
The
presence at the Annual Meeting, in person or by a properly executed
proxy, of the holders of a majority of the outstanding shares of
the Company’s Common Stock as of the Record Date is necessary
to constitute a quorum. In the determination of the number of
shares of Common Stock present at the Annual Meeting for quorum
purposes abstentions and broker “non-votes” are
included. A broker "non-vote" occurs when a nominee holding shares
of Common Stock for a beneficial owner does not vote on a
particular proposal because the nominee does not have discretionary
voting power with respect to that item and has not received
instructions from the beneficial owner.
Voting of Proxies, Revocation, Solicitation
All
stockholders who deliver properly executed and dated proxies to the
Company prior to the Annual Meeting will be deemed present at the
Annual Meeting regardless of whether such proxies direct the proxy
holders to vote for or against, or to withhold or abstain from
voting. The proxies, when properly executed and returned to the
Company, will be voted in accordance with the instructions given
therein by the person executing the proxy. In the absence of
instructions, properly executed proxies other than with respect to
broker “non-votes” will be voted FOR (1) the election
of the Board’s nominees, Mr. Marcus Frampton and Mr. John A.
Moore as Class B Directors of the Company; (2) the approval of the
amendment to the 2012 Stock Option Plan of the Company; and (3) the
ratification of the appointment by the Board of Directors of
Nussbaum Berg Klein & Wolpow, CPAs LLP, as the Company’s
independent registered public accounting firm for the fiscal year
ending June 30, 2020.
Any
stockholder who executes and delivers a proxy may revoke it at any
time before it is voted by delivering a written notice of such
revocation to the Secretary of the Company at the address of the
Company set forth in this proxy statement, by submitting a properly
executed proxy bearing a later date, or by appearing at the Annual
Meeting and requesting the return of the proxy or by voting in
person. In accordance with applicable rules, boxes and designated
spaces are provided on the proxy card for stockholders to mark if
they wish either to vote for or withhold authority to vote for the
nominees for Directors, or to vote for, against or to abstain from
voting for the proposal to approve the amendment to the
Company’s 2012 Stock Option Plan and the proposal to ratify
the appointment by the Board of Directors of the Company’s
independent registered public accounting firm.
A
stockholder’s attendance at the Annual Meeting will not, by
itself, revoke a proxy given by that stockholder. Stockholders vote
at the Annual Meeting by casting ballots (in person or by proxy),
which are tabulated by a person who is appointed by the Board of
Directors before the Annual Meeting to serve as inspector of
election at the Annual Meeting and who has executed and verified an
oath of office.
It is
anticipated that this proxy statement, the enclosed proxy card, and
the Company’s Annual Report will be mailed to the Company's
stockholders on or about December 20, 2019.
4
PRINCIPAL STOCKHOLDERS
The
following table sets forth as of December 2, 2019 certain
information as to each person who to the Company’s knowledge,
based upon such person’s representations or publicly
available filings, beneficially owned more than 5% of the
outstanding shares of the Company’s Common Stock as of that
date:
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Name
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Amount
and Nature of Beneficial Ownership**
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% of
Class
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James S.
Segasture*
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162,500
(1)
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10.8
%
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Joseph G.
Cremonese*
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116,062
(2)
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7.7
%
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Fulcrum,
Inc.
100 Delawanna
Avenue
Clifton, NJ
07014
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117,370
(3)
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7.8
%
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Grace S.
Morin*
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97,450
(4)
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6.4
%
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Brookman P.
March*
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97,450
(5)
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6.4
%
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Falcon Juneau,
LLC
800 F
Street
Juneau, AK
99801
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77,085
(6)
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5.1
%
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* His
or her address is c/o Scientific Industries, Inc., 80 Orville
Drive, Suite 102, Bohemia, New York 11716.
**
Percentages of ownership are based upon the number of shares of
Common Stock issued and outstanding. Shares of Common Stock that
may be acquired pursuant to options that are exercisable within 60
days of the date indicated above are deemed outstanding for
computing the percentage ownership of the person holding such
options, but are not deemed outstanding for the percentage
ownership of any other person.
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(1)
Shares
owned jointly with his wife.
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(2)
104,062
shares are owned jointly with his wife, 7,000 shares are owned by
his wife, and 5,000 shares are issuable upon exercise of
options.
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(3)
Stock
issued in connection with the acquisition of the Torbal division
assets from Fulcrum, Inc. on February 26, 2014.
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(4)
Includes 12,500
shares issuable upon exercise of options held by her husband, Mr.
March.
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(5)
Represents 82,950
shares owned by Ms. Morin, his wife; 2000 shares owned jointly
between Ms. Morin and Mr. March; and 12,500 shares issuable upon
exercise of options by Mr. March.
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(6)
Based
on report on schedule 13G filed with the Securities and Exchange
Commission on January 23, 2019. Mr. Frampton, a director of the
Company, has voting power over these shares. Does not include 2,250
shares owned directly by Mr. Frampton.
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5
PROPOSAL 1
ELECTION OF DIRECTORS
General
The
Company's Certificate of Incorporation provides for a classified
Board of Directors, consisting of three classes, each class serving
a three-year term on a staggered basis. Two are Class A Directors,
three are Class B Directors, and two are Class C Directors. The
Board of Directors approved a reduction of the number of Class B
Directors from three to two and at the Annual Meeting, the two
Class B Directors are to be elected to serve until the annual
meeting of stockholders with respect to the fiscal year ending June
30, 2022, and until their successors are duly elected and
qualified. During the fiscal year ended June 30, 2019
(“fiscal 2019”), the Board held six meetings, with one
director not present at one meeting, and two directors not present
at another meeting, with all directors present at the remaining
meetings. Shares of Common Stock represented by executed and
returned proxies solicited by the Board of Directors will be voted
for the nominees hereinafter named if authority to do so is not
specifically withheld. If for any reason said nominee shall become
unavailable for election, which is not now anticipated, the proxies
will be voted for a substitute nominee designated by the Board of
Directors.
The
Directors of the Company are elected by the affirmative vote of the
holders of a plurality of the shares of Common Stock present in
person or represented by proxy at the Annual Meeting and entitled
to vote. A plurality means that the nominee with the largest number
of votes is elected as Director. In tabulating the vote,
abstentions and broker “non-votes” will be disregarded
and will have no effect on the outcome of the vote.
The Board of Directors recommends that stockholders vote FOR the
election of the nominees identified below to the Board of
Directors
.
Nominees
The
Board of Directors has designated Mr. Marcus Frampton and Mr. John
A. Moore, currently Class B directors, as their nominees for
election.
Marcus Frampton
(age 39), a
Director since March 2019 is the Chief Investment Officer of the
Alaska Permanent Fund Corporation and serves on the Board of
Directors of Twin Creeks Timber, LLC and Nyrada, Inc., a drug
development company. He served as Director of Investments, Real
Assets and Absolute Return of the Alaska Permanent Fund from 2016
to 2018 and Director of Investments, Private Markets of the Alaska
Permanent Fund from 2012 to 2016 for the Alaska Permanent Fund
Corporation.
John A. Moore
(age 53), a Director
since January 2019 has been providing consulting services to the
Company’s subsidiary, Scientific Bioprocessing, Inc. since
March 2019. Mr. Moore serves as Executive Chairman of Nyrada, Inc.,
a drug development company since July 2019 and prior to that served
as a director with Noxopharm Limited, a drug development company,
and is also the Chairman of Trialogics, a clinical trial software
provider. Mr. Moore was President, Chief Executive Officer and
director of Acorn Energy, Inc. from 2006 to 2016.
Other Directors
Joseph G. Cremonese
(age 83), a Director since November
2002 and Chairman of the Board since February 2006, has been,
through his affiliate, a marketing consultant to the Company since
1996. Mr. Cremonese has been since 1991, President of his
affiliate, Laboratory Innovation Company, Ltd, which is a vehicle
for the consulting services for the Company.
Grace S.
Morin
(age
71), a Director since December 4, 2006, had been President,
Director and principal stockholder of Altamira Instruments, Inc.
from December 2003 until its acquisition in November 2006 by the
Company. Ms. Morin had been employed by Altamira to supervise its
administrative functions at the Pittsburgh, Pennsylvania facility
as a full-time employee through March 31, 2009 and since that date
as a part-time consultant.
Helena R. Santos
(age 55), a Director since 2009, has
been employed by the Company since 1994, and has served since
August 2002 as its President, Chief Executive Officer, Chief
Financial Officer and Treasurer. She had previously served as Vice
President and Controller since 1997and Corporate Secretary from May
2001.
James S. Segasture
(age 83), a Director since 1991, has
been retired for the last five years.
John F.F. Watkins
(age 52), is a corporate and
securities attorney and has been a member of Reitler Kailas &
Rosenblatt LLC since 2002. Mr. Watkins was first elected to the
Board of Directors of the Company in January
2017.
6
Stock Ownership
The
following table sets forth, as of December 6, 2019, relevant
information as to the shares of Common Stock beneficially owned by
(i) each Director of the Company, (ii) each executive officer of
the Company identified in the Summary Compensation Table under
“Executive Officers and Key Personnel,” and (iii) all
directors and executive officers as a group.
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Beneficial
Owner
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Number
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Percentage
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Joseph G.
Cremonese
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116,062
(1)
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7.7
%
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Marcus
Frampton
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2,250
(2)
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.2
%
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John A.
Moore
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32,247
(3)
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2.1
%
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Grace S.
Morin
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97,450
(4)
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6.4
%
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James S.
Segasture
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162,500
(5)
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10.8
%
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Helena R.
Santos
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38,252
(6)
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2.5
%
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Robert P.
Nichols
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27,085
(7)
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1.8
%
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Brookman P.
March
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97,450
(8)
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6.4
%
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Anthony J.
Mitri
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10,000
(9)
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0.0
%
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Karl D.
Nowosielski
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34,183
(10)
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2.2
%
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All current
directors and executive officers as a group (10
persons)
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520,029
(11)
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32.7
%
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(1)
104,062
shares are owned jointly with his wife, 7,000 shares are owned by
his wife, and 5,000 shares are issuable upon exercise of
options.
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(2)
Represents 2,250
shares owned directly by Mr. Frampton does not include 77,085
shares owned by Falcon Juneau, LLC.as to which shares has voting
power.
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(3)
Includes 10,047
shares issuable upon exercise of options.
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(4)
Includes 12,500
shares issuable upon exercise of options held by her husband, Mr.
March.
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(5)
Represents shares
owned jointly with his wife.
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(6)
Includes 17,000
shares issuable upon exercise of options.
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(7)
Includes 7,500
shares issuable upon exercise of options.
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(8)
Represents 82,950
shares owned by Ms. Morin, his wife, 2,000 shares owned jointly
between Ms. Morin and Mr. March and 12,500 shares issuable upon
exercise of options by Mr. March.
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(9)
Represents shares
issuable upon exercise of options.
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(10)
Includes 9,683
shares issued in connection with the acquisition of the Torbal
Division February 2014, and 24,500 shares issuable upon exercise of
options.
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(11)
Includes 86,135
shares issuable upon exercise of options.
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7
Board Committees
The
Company has three committees – The Stock Option Committee,
the Compensation Committee, and the Audit Committee, each of which
is comprised of the entire Board of Directors.
Directors’ Compensation and Options
DIRECTORS’ COMPENSATION
For the Year Ended June 30, 2019
|
Name
(a)
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Fees Earned or Paid in Cash
($)
(b)
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Stock Awards ($)
(c)
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Option Awards($)
(d)
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Non-Equity Incentive Plan Compensation
($)
(e)
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Changes in Pension Value and Non-qualified
Deferred Compensation Earnings($)
(f)
|
Non-qualified Deferred Comp-sensation
Earnings ($)
(g)
|
All Other
Comp-
ensation ($)
(h)
|
Total ($)
(i)
|
|
Joseph
G.Cremonese
|
41,200
|
0
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0
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0
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0
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0
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43,200(1)
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84,400
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Marcus
Frampton
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2,800
|
0
|
0
|
0
|
0
|
0
|
0
|
2,800
|
|
John
A. Moore
|
9,800
|
0
|
12,000
|
0
|
0
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0
|
40,000(2)
|
61,800
|
|
Grace
S.Morin
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20,800
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0
|
0
|
0
|
0
|
0
|
18,200(3)
|
39,000
|
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James
S.Segasture
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16,800
|
0
|
0
|
0
|
0
|
0
|
0
|
16,800
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John
F.F. Watkins
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20,800
|
0
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0
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0
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0
|
0
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0
|
20,800
|
(1)
Represents amount paid to his affiliate pursuant to a marketing
consulting agreement (see Related Transactions).
(2)
Represents compensation received for his administrative services as
consultant for Scientific Bioprocessing, Inc. (“SBI”)
(see Related Transactions).
(3)
Represents compensation received for her administrative services as
a consultant for Altamira Instruments, Inc.
(“Altamira”) (see Related Transactions).
The
Company paid each Director who is not an employee of the Company or
a subsidiary a quarterly retainer fee of $2,200 and a meeting fee
of $2,000 for each meeting attended for fiscal 2019 and fiscal
2018, respectively. In addition, the Company reimburses each
Director for out-of-pocket expenses incurred in connection with
attendance at board meetings. Mr. Cremonese, as Chairman of the
Board receives an additional fee of $1,700 per month. During fiscal
2019, total director compensation to non-employee Directors
aggregated $213,600, including the consulting fees paid to Mr.
Cremonese’s affiliate, Mr. Moore, and Ms. Morin.
Mr.
Moore was awarded on a monthly basis options valued at $3,000
utilizing the Black-Scholes option pricing model (a total of 6,705
options) for the months of March, April, May, and June 2019 as part
of his consulting agreement with the Company. Since December 1,
2003, Mr. Joseph G. Cremonese, has been awarded a total of 45,000
stock options under the Company's 2002 and 2012 Stock Option Plans
of which 5,000 remain unexercised. None of the other directors have
options outstanding.
8
Executive Officers and Key Personnel
See "Directors" for the employment history
of
Ms.
Santos
.
Robert P. Nichols
(age 58), is the President of the
Genie Products Division of the Benchtop Laboratory Equipment
operations and Corporate Secretary and has been employed by the
Company since February 1998. Previously, he had been since May
2001, the Company’s Vice President of
Engineering.
Brookman P. March
(age 74), has been since July 1, 2017
Vice President of Corporate Development and Strategy and Vice
President of Sales of Altamira. Previously he had been President
and Director of Sales and Marketing of Altamira. He had been Vice
President and a Director of Altamira from December 2003 until it
was acquired by the Company in 2006. Mr. March is the husband of
Ms. Morin, a Director of the Company.
Karl D. Nowosielski
(age 39), is the President of the
Torbal Products Division of the Benchtop Laboratory Equipment
operations and Director of Marketing for the Company. He was Vice
President of Fulcrum, Inc. (the seller of the Torbal Products
Division assets) from 2004 until February 2014.
Anthony J. Mitri
(age 37), has been the
President of Altamira since May 2017. Prior to that he had been
Director of Operations and Engineer since he began his employment
with the Company in 2004.
Compensation
Discussion and Analysis.
The
Compensation Committee reviews and recommends to the Board of
Directors the compensation to be paid to each executive officer.
Executive compensation, in all instances except for the
compensation for the Chief Executive Officer (“CEO”),
is based on recommendations from the CEO. The CEO makes a
determination by comparing the performance of each executive being
reviewed with objectives established at the beginning of each
fiscal year and with objectives established during the business
year with regard to the success of the achievement of such
objectives and the successful execution of management targets and
goals.
With
respect to the compensation of the CEO, the Committee considers
performance criteria, 50% of which is related to the direction, by
the CEO, of the reporting executives, the establishment of
executive objectives as components for the successful achievement
of Company goals and the successful completion of programs leading
to the successful completion of the Business Plan for the Company
and 50% is based on the achievement by the Company of its financial
and personnel goals tempered by the amount of the income or loss of
the Company during the fiscal year.
The
compensation at times includes grants of options under its stock
option plan to the named executives. Each officer is employed
pursuant to a long-term employment agreement, containing terms
proposed by the Compensation Committee and approved as reasonable
by the Board of Directors. The Board is cognizant that as a
relatively small company, the Company has limited resources and
opportunities with respect to recruiting and retaining key
executives. Accordingly, the Company has relied upon long-term
employment agreements and grants of stock options to retain
qualified personnel.
Compensation
for each of its executive officers provided by their employment
agreements were based on the foregoing factors and the operating
and financial results of the segments under their
management.
The following table summarizes all compensation
paid by the Company to each of its executive officers for the
fiscal years ended June 30, 2019 and 2018.
9
SUMMARY COMPENSATION TABLE
|
Name and Principal
Position
(a)
|
Fiscal Year
(b)
|
Salary
($)
(c)
|
Bonus
($)
(d)
|
Stock Awards
($)
(e)
|
Option Awards
($)
(f)
|
Non- Equity Incentive
Plan Compensation ($)
(g)
|
Non- Qualified Deferred
Compensation
Earnings
($)
(h)
|
Changes in Pension Value
and Non-Qualified Deferred Compensation
Earnings
|
All Other Compensation
($)
(i)
|
Total
($)
(j)
|
|
Helena R.
Santos,
CEO,
President, CFO
|
2019
|
180,300
|
0
|
0
|
13,100
(1)
|
0
|
0
|
0
|
4,900
(5)
|
198,300
|
|
Helena R.
Santos,
CEO,
President, CFO
|
2018
|
175,000
|
25,000
|
0
|
13,100
(1)
|
0
|
0
|
0
|
6,700
(5)
|
219,800
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brookman P.
March,
Vice President
Corporate Strategy, VP, Sales of Altamira
|
2019
|
159,600
|
0
|
0
|
3,900
(2)
|
0
|
0
|
0
|
6,400
(5)
|
169,900
|
|
Brookman P.
March,
Vice President
Corporate Strategy, VP, Sales of Altamira
|
2018
|
155,000
|
10,000
|
0
|
3,900
(2)
|
0
|
0
|
0
|
6,200
(5)
|
175,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony
Mitri,
President of
Altamira
|
2019
|
120,000
|
0
|
0
|
6,500
(3)
|
0
|
0
|
0
|
4,800
(5)
|
131,300
|
|
Anthony
Mitri,
President of
Altamira
|
2018
|
110,000
|
0
|
0
|
1,600
(3)
|
0
|
0
|
0
|
4,400
(5)
|
116,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Robert P.
Nichols,
President of
Genie Division
|
2019
|
157,600
|
0
|
0
|
3,900
(2)
|
0
|
0
|
0
|
6,800
(5)
|
168,300
|
|
Robert P.
Nichols,
President of
Genie Division
|
2018
|
153,000
|
10,000
|
0
|
3,900
(2)
|
0
|
0
|
0
|
6,300
(5)
|
173,200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Karl D.
Nowosielski
President of
Torbal Division and Director of Marketing
|
2019
|
163,300
|
10,000
|
0
|
7,400
(4)
|
0
|
0
|
0
|
6,400
(5)
|
187,100
|
|
Karl D.
Nowosielski
President of
Torbal Division and Director of Marketing
|
2018
|
161,700
|
10,000
|
0
|
7,400
(4)
|
0
|
0
|
0
|
6,400
(5)
|
185,500
|
(1)
The amounts represent compensation expense for the stock options
granted on July 1, 2017 valued utilizing the Black-Scholes-Merton
options pricing model, disregarding estimates of forfeitures
related to service-based vesting considerations. The option was
valued at a total of $39,200 of which $13,100 was expensed in each
of fiscal 2019 and fiscal 2018.
(2)
The amounts represent compensation expense for the July 1, 2017
stock options granted valued utilizing the Black-Scholes-Merton
options pricing model, disregarding estimates of forfeitures
related to service-based vesting considerations. The option was
valued at a total of $11,800 for each individual, of which $3,900
was expensed in each of fiscal 2019 and fiscal 2018.
(3)
The amounts represent compensation expense for the stock options
granted on June 30, 2018 and December 31, 2017 valued utilizing the
Black-Scholes-Merton options pricing model. The option was valued
at a total of $10,000 and $9,500, respectively, utilizing the
Black-Scholes options pricing model, of which a total of $6,500 and
$1,600 was expensed in fiscal 2019 and fiscal 2018,
respectively.
(4)
The amounts represent compensation expense for the stock options
granted on July 1, 2017, and February 26, 2017, valued utilizing
the Black-Scholes-Merton options pricing model, disregarding
estimates of forfeitures related to service-based vesting
considerations. The stock options were granted as part of his
employment agreement. The options were valued at a total of
$11,800, and $10,500, respectively, of which $7,400 was expensed in
each of fiscal 2019 and 2018.
(5)
The amounts represent the Company’s matching contribution
under the Company’s 401(k) Plans.
10
GRANTS OF PLAN-BASED AWARDS IN FISCAL YEAR ENDED JUNE 30,
2019
There
were no stock options granted to officers during fiscal
2019.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
|
Option Awards
|
|||||
|
Name
(a)
|
Number
of Securities Under- lying Unexercised Options (#) Exercisable
(b)
|
Number
of Securities Under- lying Unexercised Options (#) Unexerci- sable
(c)
|
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised
Unearned Options (#) (d)
|
Option
Exercise Price ($) (e)
|
Option
Expiration Date (f)
|
|
Helena
Santos
|
8,333
|
16,667
|
0
|
3.08
|
07/2027
|
|
Anthony
Mitri
|
3,334
|
6,666
|
0
|
3.05-3.27
|
09/2018-06/2028
|
|
Brookman
March
|
9,500
|
5,000
|
0
|
3.71-3.96
|
05/2022-07/2027
|
|
Robert
Nichols
|
4,500
|
5,000
|
0
|
3.50
|
12/2023-07/2027
|
|
Karl
Nowosielski
|
17,500
|
7,000
|
0
|
3.05-4.05
|
02/2024-07/2027
|
There
were no options exercised by officers during fiscal
2018.
Employment Agreements
On
July 1, 2017, the Company entered into a new employment agreement
with Ms. Helena R. Santos through June 30, 2020 with the option to
extend for two additional one-year periods. The agreement provides
for an annual base salary for the fiscal year ended June 30, 2018
of $175,000 with annual increases thereafter of 3% per annum or the
percentage increase, if any, in the Consumer Price Index, whichever
is higher. The agreement also provides for a bonus of $25,000 for
the fiscal year ended June 30, 2018 and on a discretionary basis
thereafter. No bonuses were granted during fiscal 2019. The
agreement also provided for a grant of options to purchase 25,000
shares of the Company’s stock which were granted during the
year ended June 30, 2018. The agreement does not provide for the
grant of stock options in 2019.
On
July 1, 2017, the Company entered into a new employment agreement
with Mr. Robert P. Nichols through June 30, 2020 with the option to
extend for two additional one-year periods. The agreement provides
for an annual base salary for the fiscal year ended June 30, 2018
of $153,000 with annual increases thereafter of 3% per annum or the
percentage increase, if any, in the Consumer Price Index, whichever
is higher. The agreement also provides for a bonus of $10,000 for
the fiscal year ended June 30, 2018 and on a discretionary basis
thereafter. No bonuses were granted during fiscal 2019. The
agreement also provided for a grant of options to purchase 7,500
shares of the Company’s stock which were granted during the
year ended June 30, 2018. The agreement does not provide for the
grant of stock options in 2019.
On July 1, 2017, the Company entered into a new
employment agreement with Mr. Brookman P. March through June 30,
2020 with the option to extend for two additional one-year periods.
The agreement provides for an annual base salary for the fiscal
year ended June 30, 2018 of $155,000 with annual increases
thereafter of 3% per annum or the percentage increase, if any, in
the Consumer Price Index, whichever is higher. The agreement also
provides for a bonus of $10,000 for the fiscal year ended June 30,
2018 and on a discretionary basis thereafter. No bonuses were
granted during fiscal 2019. The agreement also provided for a grant
of options to purchase 7,500 shares of the Company’s stock
which were granted during the year ended June 30, 2018. The
agreement does not provide for the grant of stock options in
2019.
March is the husband of
Grace S. Morin, a Director of the Company and of Altamira and a
former principal stockholder of Altamira.
11
On
July 1, 2017, the Company entered into a new employment agreement
with Mr. Karl Nowosielski through June 30, 2020 with the option to
extend for two additional one-year periods. The agreement provides
for an annual base salary for the fiscal year ended June 30, 2018
of $157,000 with annual increases thereafter of 4% per annum. The
agreement also provides for a bonus of $10,000 for the fiscal year
ending June 30, 2018 and $10,000 for each subsequent year, provided
a minimum 5% increase in the EBITDA of the Torbal Products Division
is achieved. A bonus of $10,000 was awarded during fiscal 2019. The
agreement also provided for a grant of options to purchase 7,500
shares of the Company’s stock which were granted during the
year ended June 30, 2018. The agreement does not provide for the
grant of stock options in 2019.
On
May 16, 2017, the Company entered into a new employment agreement
with Mr. Anthony Mitri through June 30, 2019 with the option to
extend for one additional year period, which was exercised by
mutual agreement. The agreement provides for an annual base salary
for the fiscal year ended June 30, 2019 of $120,000 and $110,000
for the fiscal year ending June 30, 2018 plus incentive pay based
on achievement of certain sales and income levels of Altamira
Instruments, Inc. No incentive pay was earned for the fiscal year
ended June 30, 2019 or 2018. The agreement also provided for the
grant of stock options to purchase up to an aggregate of 10,000
shares, all of which were granted during the fiscal year ended June
30, 2018. No shares were granted during the year ended June 30,
2019.
The
employment agreements for Ms. Santos, Mr. Nichols, Mr. March, Mr.
Nowosielski, and Mr. Mitri contain confidentiality and
non-competition covenants. The employment agreements for all the
named executives above, except Mr. Mitri, contain termination
provisions stipulating that if the Company terminates the
employment other than for death, disability, or cause (as such term
is defined therein), or if the relevant employee resigns for
“good reason” (as such term is defined therein), the
Company shall pay severance payments equal to one year’s
salary at the rate of the compensation at the time of termination,
and continue to pay the regular benefits provided by the Company
for a period of one year from termination. Ms. Santos’
employment agreement also contains a provision that within one year
of a change of control, if either the Company terminates her
employment for any reason other than for “cause” or she
terminates her employment for “good reason”, she will
have the right to receive a lump sum payment equal to three times
the average of her total annual compensation paid for the last five
years immediately preceding such termination, minus
$1.00.
Related Transactions
Mr.
Joseph G. Cremonese, a Director since November 2002, through his
affiliate, Laboratory Innovation Company, Ltd., has been providing
independent marketing consulting services to the Company since
January 1, 2003 pursuant to a consulting agreement expiring
December 31, 2019. The agreement currently provides that Mr.
Cremonese and his affiliate shall render, at the request of the
Company, marketing consulting services for a monthly payment of
$3,600. The agreement contains confidentiality and non-competition
covenants. The Company paid fees of $43,200 pursuant to the
agreement for each of fiscal 2019 and 2018.
Ms.
Grace S. Morin, was elected a Director in December 2007 following
the sale of her 90.36% ownership interest in Altamira to the
Company in November 2006. Up until March 31, 2009, Ms. Morin had
been employed by Altamira as an administrative employee. Since
April 1, 2009, she has provided consulting services on a part-time
basis pursuant to an agreement expiring December 31, 2019 at the
rate of $85 per hour, resulting in payments of $18,200 and $7,000
for fiscal 2019 and fiscal 2018, respectively. The agreement
contains confidentiality and non-competition
covenants.
Mr.
John A. Moore, a Director since January 2019, has been providing
consulting services to the Company since March 2019 pursuant to a
consulting agreement which expired on August 31, 2019 which has
been renewed for an additional six months. The agreement currently
provides that Mr. Moore shall render, at the request of the
Company, consulting services as to the operations of Scientific
Bioprocessing, Inc., a wholly-owned subsidiary of the Company for a
monthly payment of $10,000 plus the issuance of stock options
valued at $3,000. The agreement contains confidentiality and
non-competition covenants. The Company paid fees of $40,000 and
granted options with a value of $12,000 pursuant to the agreement
for fiscal 2019.
Section 16(a) Reporting
The
Company believes that, for the year ended June 30, 2019, its
officers, directors and 10% stockholders timely complied with all
filing requirements of Section 16(a) of the Securities Exchange Act
of 1934, as amended.
12
PROPOSAL 2
PROPOSAL TO APPROVE AMENDMENT TO THE 2012 STOCK OPTION
PLAN
General
The
Board of Directors, subject to stockholders’ approval,
approved an amendment to the Company’s 2012 Stock Option Plan
(the “2012 Plan”) to increase the number of shares
available for issuance thereunder by 150,000 shares, from 157,000
to 307,000 shares, and directed that the amendment be submitted to
the stockholders for approval at the 2019 Annual Meeting. The
proposed amendment is attached as Exhibit A to this Proxy
Statement.
The
amendment to the 2012 Plan is intended to ensure that we can
continue to provide an incentive to our key employees, directors,
and consultants by enabling them to share in our future growth. If
approved by the stockholders, all of the additional shares will be
available for grant as incentive stock options within the meaning
of Section 422 of the Internal Revenue Code of 1986, as amended
(the “Code”), or as nonqualified stock options as
defined in the 2012 Plan. If the stockholders do not approve the
amendment, no shares will be added and the 2012 Plan will only have
17,453 available for grant as of the record date.
The
2012 Plan was adopted on February 12, 2012, and approved by the
stockholders at the 2011 Annual Meeting of Stockholders. 157,000
shares of the Company’s Common Stock were initially approved
and available for awards under the 2012 Plan. The purpose of the
2012 Plan was to create incentives which are designed to motivate
eligible employees, directors, and consultants to put forth maximum
effort toward the success and growth of the Company, and to enable
the Company to attract and retain experienced individuals who by
their position, ability and diligence are able to make important
contributions to the Company’s success.
As of
December 2, 2019 the number of shares currently available for grant
is 17,453. Our Board does not believe that the number of shares
available for issuance under the 2012 Plan is sufficient in light
of our current strategy for growth. The increase represents
approximately 9% of the outstanding total number of shares of the
Company’s Common Stock as of December 2, 2019. After giving
effect to such increase, the number of shares of Common Stock
currently subject to outstanding awards (as per Note 11 of Stock
Ownership section), and shares currently available for issuance
(17,453) pursuant to future awards will represent approximately 17%
of our total outstanding shares of Common Stock.
Summary of the 2012 Plan
The
following summary of the provisions of the 2012 Plan is qualified
in its entirety by reference to the text of the 2012
Plan.
Options Authorized:
The
2012 Plan permits, as did the 2002 Plan, the Company to grant both
incentive stock options (“Incentive Stock Options”)
within the meaning of Section 422 of the Code, and other options
which do not qualify as Incentive Stock Options
(“Non-Qualified Options”).
The
aggregate number of shares of Common Stock reserved for issuance
under the 2012 Plan is 157,000, which includes 57,000 shares which,
as of November 18, 2011, were reserved for issuance upon the
exercise of outstanding stock options granted pursuant to the 2002
Plan. To the extent that any of the stock options previously
granted under the 2002 Plan expire or terminate for any reason
without having been exercised, then stock options exercisable for
that same number of shares of Common Stock may be granted under the
2012 Plan. Accordingly, to the extent any of the outstanding
options granted under the 2002 Plan are exercised, the number of
shares for which options may be granted under the 2012 Plan will be
reduced.
Unless
earlier terminated by the Board of Directors, the 2012 Plan (but
not outstanding options) will terminate on February 10, 2022,
after which no further awards may be granted under the 2012 Plan.
The 2012 Plan is administered by the full Board of Directors or, at
the Board’s discretion, by a committee of the Board (the
“Committee”) consisting of at least two
persons.
Recipients of
options under the 2012 Plan (“optionees”) are to be
selected by the Board or the Committee. Unless otherwise provided
by the Board or the Committee, options shall be exercisable in
three equal, cumulative installments commencing respectively on the
first, second, and third anniversary of the date of grant. The
purchase price will be based on the fair market value of a share of
Common Stock on the date of grant as determined pursuant to Section
422 (c)(7) of the Internal Revenue Code (the “Code”).
The Board or the Committee determines the terms of each option
grant including (1) the purchase price of shares subject to
options, (2) the dates on which options become exercisable; (3) the
expiration date of each option (which may not exceed ten years from
the date of grant except for an incentive stock option granted to
an employee who is also at least a 10% stockholder five years from
the date of grant) and (4) any restriction to which the options are
subject. The minimum per share purchase price for Incentive Stock
Options and options granted to any director of the Company or a
subsidiary who is not an employee of the Company or subsidiary
(“Director”) is the fair market value or 110% of the
fair market value for an Incentive Stock Option granted to an
employee who owns at least 10% of the outstanding shares of Common
Stock.
13
Optionees will have
no voting, dividend or other rights as stockholders with respect to
shares of Common Stock covered by options prior to becoming the
holders of record of such shares. The purchase price upon the
exercise of options may be paid in cash, by certified bank or
cashier’s check or by tendering stock held by the optionee or
by cashless exercise through a broker. The total number of shares
of Common Stock available under the 2012 Plan, and the number of
shares and per share exercise price under outstanding options will
be appropriately adjusted in the event of any reorganization,
merger or recapitalization of the Company or similar corporate
event.
The
Board of Directors may at any time terminate the 2012 Plan or from
time to time make such modifications or amendments to the 2012 Plan
as it may deem advisable and the Board or Committee (other than
with respect to options held by a Director) may adjust, reduce,
cancel and regrant an unexercised option if the fair market value
declines below the exercise price subject to Section 409A of the
Code. In no event may the Board, without the approval of
stockholders, amend the 2012 Plan to increase the maximum number of
shares of Common Stock for which options may be granted under the
2012 Plan or change the class of persons eligible to receive
options under the 2012 Plan, or change the manner of determining
the option prices, or extend the period during which an option may
be granted or exercised.
Subject
to limitations set forth in the 2012 Plan, the terms of option
agreements will be determined by the Board or Committee, and need
not be uniform among optionees.
FEDERAL INCOME TAX CONSEQUENCES
The following
is a brief discussion of the Federal income tax consequences of
transactions under the 2012 Plan. This discussion is not intended
to be exhaustive and does not describe state or local tax
consequences.
Incentive Stock Options:
No
taxable income is realized by the optionee upon the grant or
exercise of an Incentive Stock Option. If Common Stock is issued to
an optionee pursuant to the exercise of an Incentive Stock Option,
and if no disqualifying disposition of such shares is made by such
optionee within two years after the date of grant or within one
year after the transfer of such shares to such optionee, then
(1) upon sale of such shares, any amount realized in excess of
the option price will be taxed to such optionee as a long-term
capital gain and any loss sustained will be a long-term capital
loss, and (2) no deduction will be allowed to the optionee’s
employer for Federal income tax purposes.
Except
as noted below for corporate “insiders,” if the Common
Stock acquired upon the exercise of an Incentive Stock Option is
disposed of prior to the expiration of the holding period described
above, generally (1) the optionee will realize ordinary income
in the year of disposition in an amount equal to the excess (if
any) of the fair market value of such shares at exercise (or, if
less, the amount realized on the disposition of such shares) over
the option price paid for such shares and (2) the Company will be
entitled to deduct such amount for Federal income tax purposes if
the amount represents an ordinary and necessary business expense.
Any further gain (or loss) realized by the optionee will be taxed
as short-term or long-term capital gain (or loss), as the case may
be, and will not result in any deduction by the
Company.
Subject
to certain exceptions for disability or death, if an Incentive
Stock Option is exercised more than three months following
termination of employment, the exercise of the option will
generally be taxed as the exercise for a Non-Qualified
Option.
For
purposes of determining whether an optionee is subject to any
alternative minimum tax liability, an optionee who exercises an
Incentive Stock Option generally would be required to increase his
or her alternative minimum taxable income, and compute the tax
basis in the stock so acquired, in the same manner as if the
optionee had exercised a Non-Qualified Option. Each optionee is
potentially subject to the alternative minimum tax. In substance, a
taxpayer is required to pay the higher of his/her alternative
minimum tax liability or his/her “regular” income tax
liability. As a result, a taxpayer has to determine his potential
liability under the alternative minimum tax.
Non-Qualified Options:
Except
as noted below for corporate “insiders,” with respect
to Non-Qualified Options: (1) no income is realized by the
optionee at the time the option is granted; (2) generally, at
exercise, ordinary income is realized by the optionee in an amount
equal to the difference between the option price paid for the
shares and the fair market value of the shares, if unrestricted, on
the date of exercise, (and the Company is generally entitled to a
tax deduction in the same amount), subject to applicable tax
withholding requirements; and (3) at sale, appreciation (or
depreciation) after the date of exercise is treated as either
short-term or long-term capital gain (or loss) depending on how
long the shares have been held.
Special Rules Applicable To Corporate Insiders:
As a
result of the rules under Section 16(b) of the Exchange Act,
“insiders” (as defined in the Exchange Act), depending
upon the particular exemption from the provisions of
Section 16(b) utilized, may not receive the same tax treatment
as set forth above with respect to the grant and/or exercise of
options. Generally, insiders will not be subject to taxation until
the expiration of any period during which they are subject to the
liability provisions of Section 16(b) with respect to any
particular option. Insiders should check with their own tax
advisers to ascertain the appropriate tax treatment for any
particular option.
The Board of Directors unanimously recommends that the stockholders
vote FOR the proposal to amend the 2012 Stock Option
Plan.
14
PROPOSAL 3
APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The
Board of Directors, subject to stockholders’ approval,
appointed Nussbaum Berg Klein & Wolpow, CPAs LLP (the
“Firm”) as the Company’s independent registered
public accounting firm for the fiscal year ending June 30, 2020.
The Firm has audited the consolidated financial statements of the
Company since 1991. A representative of the Firm is expected to be
present at the Annual Meeting, and will have an opportunity to make
a statement to the stockholders and will be available to respond to
appropriate questions. The ratification of the appointment will
require the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock present in person or represented
by proxy at the Annual Meeting and entitled to vote. Abstentions
will be included in determining the number of shares of Common
Stock present or represented and entitled to vote for purposes of
approval and will have the effect of votes “against”
the proposal. Broker “non-votes” will not be counted in
determining the number of shares of Common Stock present or
represented and entitled to vote to approve the proposal and will
therefore not have the effect of votes either “for” or
“against”.
Stockholder
ratification of the appointment is not required by the
Company’s Certificate of Incorporation or By-laws or
otherwise. If the stockholders fail to ratify the appointment, the
Board of Directors will reconsider whether to retain that firm.
Even if the appointment is ratified, the Board of Directors in its
discretion may direct the appointment of a different independent
registered public accounting firm at any time during the year if
the Audit Committee, currently the entire Board of Directors,
determines that such a change would be in the best interest of the
Company and its stockholders.
The Board of Directors unanimously recommends that the stockholders
vote FOR the ratification of the appointment of Nussbaum Berg Klein
& Wolpow, CPA’s LLP as the independent registered public
accounting firm of the Company for the fiscal year ending June 30,
2020
.
OTHER MATTERS
The
Board of Directors are not aware of any matters other than those
set forth in this proxy statement that will be presented for action
at the Annual Meeting; however, if any other matters properly come
before the Annual Meeting, the persons named as proxies intend to
vote the shares of Common Stock they represent in accordance with
their judgment on such matters.
15
ADDITIONAL INFORMATION
The
Company's Annual Report to Stockholders for the fiscal year ended
June 30, 2019, includes its Annual Report on Form 10-K for the year
which was filed with the U.S. Securities and Exchange Commission on
October 4, 2019. The Annual Report to Stockholders on Form 10-K is
not part of this proxy material, but is being mailed to
stockholders with this proxy solicitation. Certain information
included herein is incorporated in the Report by
reference.
STOCKHOLDER PROPOSALS
Proposals of
stockholders of the Company intended to be presented at the
Company’s Annual Meeting of Stockholders following the year
ending June 30, 2020 must be received by the Secretary of the
Company for inclusion in the appropriate proxy materials no later
than August 6, 2020.
EXPENSES AND SOLICITATION
The
entire cost of soliciting proxies will be borne by the Company. In
addition to the use of the mails, proxies may be solicited by
officers, directors and regular employees of the Company personally
or by telephone. No additional compensation will be paid to such
persons for any additional solicitations. The Company will also
request securities brokers, custodians, nominees and fiduciaries
who hold shares of Common Stock of record to forward solicitation
material to the beneficial owners of such shares, and will
reimburse them for their reasonable out-of-pocket expenses in
forwarding such soliciting materials.
|
|
By
Order of your Board of Directors,
|
|
|
|
|
|
|
|
/s/ Robert. P. Nichols
|
|
|
|
Robert
P. Nichols
|
|
|
|
Secretary
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Bohemia,
New York
December
6, 2019
16
SCIENTIFIC INDUSTRIES, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
January 29, 2020
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The
undersigned hereby appoints Joseph G. Cremonese and Helena R.
Santos, and each of them, with full power of substitution, to vote,
as a holder of the common stock, par value $0.05 per share
(“Common Stock”), of Scientific Industries, Inc., a
Delaware corporation (the “Company”), all the shares of
Common Stock which the undersigned is entitled to vote, through the
execution of a proxy with respect to the 2019 Annual Meeting of
Stockholders of the Company (the “Annual Meeting”), to
be held at La Quinta Inn & Suites, 10 Aero Road, Bohemia, New
York, on Wednesday, January 29, 2020 at 11:00 a.m. New York time,
and any and all adjournments or postponements thereof, and
authorizes and instructs said proxies to vote in the manner
directed below.
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1.
Election of Class B Directors:
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MARCUS
FRAMPTON
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JOHN A.
MOORE
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FOR
both nominees
☐
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WITHHOLD
for both nominees
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If you
wish your shares voted AGAINST one of the nominees, draw a line
through that person's name above.
2.
Approve the amendment to the 2012 Stock Option Plan of the
Company.
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FOR
☐
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AGAINST
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ABSTAIN
☐
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3.
Ratify the appointment of Nussbaum Berg Klein & Wolpow,
CPA’s LLP, as the Company’s independent registered
public accounting firm for the fiscal year ending June 30,
2020.
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FOR
☐
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AGAINST
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ABSTAIN
☐
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4. In
their discretion, the proxies are authorized to vote upon such
other business as may properly come before such meeting or
adjournment or postponement thereof.
The
Board of Directors recommends the vote FOR the election of the
named nominees for Class B Directors and proposals 2 and
3.
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THIS PROXY IS CONTINUED ON THE REVERSE SIDE, PLEASE VOTE, SIGN AND
DATE ON REVERSE SIDE AND RETURN PROMPTLY.
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PROPERLY EXECUTED AND RETURNED PROXY CARDS WILL BE VOTED IN THE
MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO
INSTRUCTIONS TO THE CONTRARY ARE MADE, THIS PROXY WILL BE VOTED FOR
THE ELECTION OF THE NAMED
NOMINEES, TO APPROVE PROPOSAL NO. 2, AND TO
APPROVE PRROPOSAL NO. 3.
You may
revoke this proxy at any time before it is voted by (i) filing a
revocation with the Secretary of the Company, (ii) submitting a
duly executed proxy bearing a later date or time than the date or
time of the proxy being revoked; or (iii) attending the Annual
Meeting and voting in person. A stockholder’s attendance at
the Annual Meeting will not by itself revoke a proxy given by the
stockholder. (Please sign exactly as the 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 with full corporate name by the
president or other authorized
officer.
If a partnership, please sign in the partnership name by an
authorized person.)
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Dated:
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Signature
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Signature,
if held by joint owners
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PLEASE COMPLETE, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
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17
Exhibit
A
AMENDMENT NO. 1
TO
SCIENTIFIC INDUSTRIES, INC.
2012 STOCK OPTION PLAN
(Effective as of February 28, 2020)
The
Scientific Industries, Inc. 2012 Stock Option Plan (as may be
amended from time to time, the “
Plan
”) is hereby amended as
follows:
1. Section
2 of the Plan is hereby amended and restated in its entirety to
read as follows:
“2. Shares
Subject to Plan. Options may be granted to purchase up to Two
Hundred Fifty Thousand (250,000) shares of the common stock, par
value $0.05 per share (the “
Common Stock
”), of the Company. In
addition, to the extent that options previously granted under the
2002 Stock Option Plan of the Company (the “
Prior Plan
”) expire or terminate
for any reason without having been exercised, then options
exercisable for that same number of shares of Common Stock, up to a
maximum of Fifty-Seven Thousand (57,000) shares, may be granted
pursuant to the Plan. For the purpose of this Section 2, the number
of shares purchased upon the exercise of an Option shall be
determined without giving effect to the use by a Participant of the
right set forth in Section 7(C) hereof to deliver shares of the
Common Stock in payment of all or a portion of the option price or
the use by a Participant of the right set forth in Section 11(C)
hereof to cause the Company to withhold from the shares of the
Common Stock otherwise deliverable to him or her upon the exercise
of an Option shares of the Common Stock in payment of all or a
portion of his or her withholding obligation arising from such
exercise. If any Options expire or terminate for any reason without
having been exercised in full, new Options may thereafter be
granted to purchase the unpurchased shares subject to such expired
or terminated Options. Subject to the provisions of Section 10, the
maximum number of shares of Common Stock which may be issued in
accordance with the provisions of this Section 2 shall be Three
Hundred Seven Thousand (307,000) shares.”
2. All
capitalized terms used but not otherwise defined herein shall have
the meanings assigned to them in the Plan. Except as expressly
amended hereby, the terms and conditions of the Plan shall remain
in full force and effect. This amendment shall be governed by the
laws of the State of New York without giving effect to the
conflicts of law principles thereof. This amendment shall be
effective as of the date first set forth above.
[END OF
DOCUMENT]
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