THE DEWEY ELECTRONICS CORPORATION
_________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
NOTICE IS HEREBY GIVEN that the annual meeting of stockholders
of THE DEWEY ELECTRONICS CORPORATION will be held at the office of the
Corporation at 27 Muller Road, Oakland, New Jersey, on Wednesday,
December 3, 2003 at 10:30 A.M. (Eastern Standard Time) for the
purposes of
(1) electing five directors to serve until the next annual
meeting of stockholders and until their successors shall be elected
and shall qualify;
(2) transacting such other business as may properly come before
the meeting or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on
October 23, 2003 as the record date for determination of stockholders
entitled to notice of and to vote at the meeting.
If you will be unable to attend the meeting, you are
respectfully requested to sign and return the accompanying proxy in
the enclosed envelope.
By Order of the Board of Directors
FRANCES D. DEWEY
Secretary
October 31, 2003
THE DEWEY ELECTRONICS CORPORATION
_______________________________________
PROXY STATEMENT
This proxy statement is furnished to the stockholders of The
Dewey Electronics Corporation (hereinafter referred to as the
"Corporation") in connection with the solicitation of proxies for the
annual meeting of stockholders to be held on December 3, 2003. The
mailing address of the Corporation's executive offices is 27 Muller
Road, Oakland, New Jersey 07436, and its telephone number is (201)
337-4700. It is planned to commence the mailing of this proxy
material to stockholders on or about October 31, 2003.
The enclosed proxy is solicited by the management of the
Corporation. A person giving the proxy has the power to revoke it at
any time before its exercise by notice to such effect delivered to the
Secretary of the Corporation.
The Corporation will bear the cost of the solicitation of
proxies, including the charges and expenses of brokerage firms and
others for forwarding solicitation material to beneficial owners of
stock. In addition to the use of the mails, proxies may be solicited
by personal interviews, by telephone or by electronic means.
It is important that your shares are represented at the meeting.
Whether or not you expect to attend the meeting, please be sure
that the enclosed proxy card is properly completed, dated, signed and
returned without delay in the enclosed envelope, which requires no
postage if mailed in the United States. You may revoke your proxy at
any time prior to the time it is voted.
VOTING SECURITIES OUTSTANDING
Shares of Common Stock, 1,359,531 of which were outstanding as
of the close of business on September 30, 2003, are the only voting
securities of the Corporation and are entitled to one vote per share.
Only holders of Common Stock of record at the close of business
on October 23, 2003, will be entitled to vote at the annual meeting of
stockholders.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding
ownership of the Corporation's Common Stock, as of September 30, 2003
(except as otherwise noted), by: (i) each person who is known by the
Corporation to own beneficially more than five percent of the
Corporation's Common Stock, (ii) each of the Corporation's directors
and nominees for director, (iii) each of the Corporation's executive
officers for whom information is provided in the "Summary Compensation
Table" below, and (iv) all executive officers and directors as a
group. The information presented in the table is based upon certain
filings with the Securities and Exchange Commission by such persons,
as indicated in the notes to the table below, or upon information
otherwise provided by such persons to the Corporation. According to
such filings or other information, such persons have sole voting and
investment power with respect to shares reported as beneficially owned
(except as indicated in the notes to the table below).
The address of each person who is a director or officer of the
Corporation is 27 Muller Road, Oakland, New Jersey 07436.
Name of Beneficial Owner Number of Shares % of the
Beneficially owned Common
Stock
Frances D. Dewey 495,233 (1) 36.43%
Asset Value Fund Limited
Partnership
376 Main Street,
P.O. Box 74
Bedminster, New Jersey
07921 139,800 (2) 10.28%
Alexander A. Cameron 12,649 *
John H.D. Dewey 43,417 (3) 3.19%
LTG. James M. Link
(USA Retired) -- --
Nathaniel Roberts 1,475 *
Francis DeLorenzo 12,000 (4) *
Edward Proskey 12,010 (5) *
Thom A. Velto 12,715 (5) *
All Directors and
Executive Officers as a
Group (8 persons) 589,499 (6) 42.86%
* Less than 1%.
(1)Includes 235,691 shares of Common Stock (the "Estate Shares")
beneficially owned by Mrs. Dewey in her capacity as executor of
the Estate of Gordon Dewey. Mrs. Dewey is also the beneficiary
of the Estate Shares. Does not include any shares of Common
Stock beneficially owned by Mrs. Dewey's son, John H.D. Dewey.
Mrs. Dewey disclaims any beneficial interest in the shares of
Common Stock beneficially owned by John H.D. Dewey.
(2)Based upon a Form 4 dated April 4, 2003, filed with the
Securities and Exchange Commission.
(3)Includes 20,308 shares of Common Stock owned of record by
a trust for the benefit of a daughter of Frances D. Dewey, of
which John H.D. Dewey (Mrs. Dewey's son) is the sole trustee.
Does not include any shares of Common Stock beneficially owned
by Mrs. Dewey. Mr. Dewey disclaims any beneficial interest in
the shares of Common Stock beneficially owned by Mrs. Dewey.
(4)Includes 12,000 shares issuable upon exercise of stock options
granted under the Corporation's 1998 Stock Option Plan.
(5)Includes 2,000 shares issuable upon exercise of options
granted under the Corporation's 1998 Stock Option Plan.
(6)Includes 16,000 shares issuable upon exercise of options.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
At the annual meeting of stockholders, five directors are to be
elected, to serve for the ensuing year and until their respective
successors are elected and qualify. The shares represented by the
accompanying proxy will be voted for the re-election of Alexander A.
Cameron, Frances D. Dewey, John H.D. Dewey, LTG James M. Link (USA
Ret) and Nathaniel Roberts, unless a contrary specification is made.
If any such nominee becomes unavailable for any reason, or if a
vacancy should occur before the election (which events are not
anticipated), the shares represented by the accompanying proxy may be
voted for such other person as may be determined by the holders of
such proxies, or the Board of Directors may elect to reduce the number
of directors. Directors are elected by a plurality of the votes cast.
Votes withheld, and abstentions and broker non-votes, will not have
the effect of votes cast either in favor of or in opposition to a
nominee.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ELECTION OF THE ABOVE
NOMINEES AS DIRECTORS.
Information Concerning Directors and Nominees
The following table sets forth the name of each nominee for
election to the Board of Directors, his or her age, principal
occupation during the past five years and the name and principal
business of any corporation or organization in which such occupation
is carried on, and the period during which he or she has served as
director.
Name Age Principal Occupation
During Past Five Years
Other Directorships and Director
Positions With Corporation Since
Alexander A.
Cameron 81 President, Key Research
and Market Development, Inc.
Business Consultants 1964
Frances D.
Dewey 76 Director of the Corporation
(Chairperson of the Board
since June 14, 2002)
Secretary of the Corporation 1955
John H.D.
Dewey 38 President and Chief Executive
Officer of the Corporation
(since December 4, 2002;
Acting Chief Executive
Officer from June 14, 2002
until December 4, 2002)
Management Consultant (until
June 14, 2002)President,
Monastery Graphics, Inc.
Information Technology
Consulting 1999
LTG James
M. Link
(USA Retired) 60 President
Director (since July 21,
2001)Teledyne Brown
Engineering
Systems Engineering 2001
Nathaniel
Roberts 37 General Manager
Callery-Judge Grove
Citrus Suppliers 1999
During the Corporation's last fiscal year, the Board of
Directors held five meetings. Each incumbent director attended all
meetings.
The Corporation's current policy regarding compensation of
directors is to pay $4,000 per annum plus $400 for each Board meeting
attended. No payments for services as a director during fiscal year
2003 were made to John H.D. Dewey (who received compensation as an
officer of the Corporation). Annual compensation of $25,000 was paid
to Frances D. Dewey as Chairperson of the Board, in lieu of the
directors fees described above. In December 2001, shareholders
approved a Stock Option Plan for Non-Employee Directors under which
options exercisable for a total of 50,000 shares of Common Stock may
be granted. To date, no options have been granted under this plan,
which is administered by the Board.
Pursuant to a consulting and advisory agreement with LTG James
M. Link (USA Retired), the Corporation paid General Link, as
compensation for services rendered, a fee of $2,000 per month plus
additional fees under certain conditions. For his services in fiscal
year 2003, General Link received a total of $16,000. This agreement
was terminated in March 2003.
The Board has a Stock Option Committee which is composed of
Messrs. Cameron and Roberts. The Committee administers the 1998 Stock
Option Plan of the Corporation. One meeting was held during the last
fiscal year; all members attended. The Board also has an Executive
Compensation Committee composed of Messrs. Roberts and Cameron. The
Committee administers executive compensation and held one meeting
during the last fiscal year; all members attended the meeting.
The Board also has a Business Development Committee composed of
John H.D. Dewey and General Link. During the last fiscal year,
General Link received $8,000 for serving on this Committee. No
payments for serving on this Committee were made to John H.D. Dewey
(who received compensation as an officer of the Corporation).
The Board does not have a nominating committee or an audit
committee.
Summary Compensation Table
The following table sets forth the aggregate compensation paid
by the Corporation during the Corporation's last three fiscal years to
(1) the chief executive officer of the Corporation and (2) the other
executive officers of the Corporation whose aggregate of salary and
bonus compensation for the fiscal year ended June 30, 2003 exceeded
$100,000.
Name and Principal Fiscal Securities
Position Year Ended Salary Bonus Underlying
Options/SARs (#)
John H.D. Dewey,
President and
Chief Executive
Officer (1) June 30, 2003 $120,000 -- 12,000
June 30, 2002 $ 4,615 -- --
June 30, 2001 -- -- --
Francis DeLorenzo
Vice President,
Government
Programs June 30, 2003 $74,855 $11,275 3,000
June 30, 2002 $72,286 $35,100 --
June 30, 2001 $71,595 $21,800 7,000
Edward L. Proskey
Senior Vice
President,
Operations June 30, 2003 $88,866 $10,000 3,000
June 30, 2002 $86,284 $34,250 --
June 30, 2001 $83,813 $21,325 2,000
Thom A. Velto
Treasurer June 30, 2003 $99,109 $10,000 3,000
June 30, 2002 $96,223 $30,000 --
June 30, 2001 $93,522 $20,000 2,000
(1) John H. D. Dewey was appointed Acting Chief Executive Officer of
the Corporation on June 14, 2002 at an annual salary of $120,000. On
December 4, 2002, Mr. Dewey was elected President and Chief Executive
Officer of the Corporation. In addition to the salary set forth in
the table above, Mr. Dewey received payments under the Corporation's
policy regarding compensation of directors for the following fiscal
years: 2003 -- $0. 2002 -- $6,000. 2001 -- $5,600. Pursuant to an
advisory agreement entered into in 2001, and terminated in 2002 when
Mr. Dewey became an employee of the Corporation, the Corporation made
payments to Monastery Graphics, Inc., a management and information
technology consulting company of which Mr. Dewey is President, in the
following amounts: 2003-- $0. 2002 -- $44,625. 2001 -- $5,063.
Since becoming an employee of the Corporation, Mr. Dewey has not
played an active role in Monastery Graphics' business.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End
Option Values
The following table sets forth, for each executive officer of
the Corporation for whom information is provided in the "Summary
Compensation Table" above, (1) the total number of shares received
upon the exercise of options during the Corporation's fiscal year
ended June 30, 2003, (2) the aggregate dollar value realized upon
exercise, (3) the total number of securities underlying unexercised
options as of the end of the Corporation's last fiscal year (June 30,
2003) and (4) the value of unexercised, in-the-money options as of the
end of the Corporation's last fiscal year.
Name Shares Value Number
Acquired on Realized of
Exercise (#) ($) Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options Options at
at Fiscal Fiscal Year
Year End (#) End ($)(1)
Exercis- Unexercis- Exercis- Unexercis-
able able able able
John H.D.
Dewey -- -- -- 12,000 -- $8,040
Francis
DeLorenzo -- -- 12,000 3,000 $40,934 $2,010
Edward L.
Proskey 10,000 $35,219 2,000 3,000 $5,950 $2,010
Thom A.
Velto 10,000 $35,219 2,000 3,000 $5,950 $2,010
(1) As there was no trading volume in the Corporation's shares on
June 30, 2003, the year end values in the table have been calculated
using the closing price of $4.60 per share on June 25, 2003, the last
day of the fiscal year for which there was trading volume. The
highest bid price on June 30, 2003 was $3.70 per share.
Option Grants in Last Fiscal Year
Name Number of % of Total Exercise Expiration
Securities Options Price Date
Underlying Granted to ($/Sh)
Options Granted Employees
(#) (1) in Fiscal
Year
John H.D.
Dewey 12,000 54.5% $3.93 12/10/13
Francis
DeLorenzo 3,000 13.6% $3.93 12/10/13
Edward L.
Proskey 3,000 13.6% $3.93 12/10/13
Thom A.
Velto 3,000 13.6% $3.93 12/10/13
(1)For each individual named in this table, options for 50% of such
shares become exercisable on December 11, 2003 and options for 50% of
such shares become exercisable on December 11, 2004.
Executive Officers
The Corporation's executive officers are: John H.D. Dewey, age
38, who was appointed Acting Chief Executive Officer in June 2002
following the death of Gordon C. Dewey and has been President and
Chief Executive Officer since December 4, 2002; Thom A. Velto, age 53,
who has been Treasurer of the Corporation since February 1990; Edward
L. Proskey, age 47, who was elected Vice President, Operations of the
Corporation in June 1994 (this title was changed to Senior Vice
President, Operations in June 2003); and Francis DeLorenzo, age 43,
who was elected Vice President, Business Development and Marketing on
June 3, 2000 (this title was changed to Vice President, Government
Programs in June 2003). Prior to such election, Mr. DeLorenzo had
been employed by the Corporation since 1991 in various program
management capacities.
Retirement Benefits
The Corporation has a non-contributory pension plan for all
active employees, under which, in general, employees with 25 or more
years of service can receive 20% of their average monthly earnings
(based on earnings during the five years preceding retirement) up to a
specified maximum of $850 per month for life assuming normal
retirement at age 65 and vested employees with lesser service receive
lesser amounts. Upon the employee's death, 50% of the monthly benefit
is payable to the employee's spouse for life. Mrs. Dewey receives
survivor's benefits of $602 per month but does not otherwise
participate in the pension plan. The Corporation's executive officers
will receive the monthly maximum amount of $850 at retirement, based
upon current compensation levels and assuming normal retirement at age
65.
Certain Relationships and Related Transactions
During 1988, Gordon C. Dewey lent the Corporation a total of
$200,000. The loans, which are unsecured, provide for the payment of
interest at the fixed rate of 9%. The loans are repayable upon demand
by Mr. Dewey's Estate, of which Frances D. Dewey is executor, but are
subordinate to the Corporation's term loan with Sovereign Bank, its
principal lender.
Insurance Arrangements
The Corporation has insurance coverage under which its directors
and officers (as well as the Corporation) are indemnified under
certain circumstances with respect to litigation and other costs and
liabilities arising out of actual or alleged misconduct of such
directors and officers. The Corporation pays all premiums to the
insurer, the Federal Insurance Company of the Chubb Group of Insurance
Companies.
Section 16(a) Beneficial Ownership Reporting Compliance
With respect to the directors and executive officers of the
Corporation, based on copies of Form 4 received by the Corporation,
John Dewey, Francis DeLorenzo, Edward Proskey and Thom Velto each
filed with the Securities and Exchange Commission a late Form 4 during
the fiscal year ended June 30, 2003, reporting one grant to him by the
Board of Directors in December 2002 of options pursuant to the
Corporation's 1998 Stock Option Plan. With respect to holders of more
than ten percent of the outstanding Common Stock, the Corporation does
not have any information regarding the Section 16(a) beneficial
ownership reporting compliance of Mr. Paul Koether for the fiscal year
ended June 30, 2003, other than his filings with the Securities and
Exchange Commission (which do not include a Form 5).
INDEPENDENT PUBLIC ACCOUNTANTS
The principal accountant selected by the Board of Directors for
the Corporation's current fiscal year is Deloitte & Touche LLP. It is
expected that a representative of Deloitte & Touche LLP will be
present at the annual meeting of stockholders with the opportunity to
make a statement if they desire to do so and to respond to appropriate
questions.
Fees
Audit Fees. The aggregate fees billed by Deloitte & Touche LLP
for professional services rendered to the Corporation for the audit of
the Corporation's annual financial statements for the fiscal year
ended June 30, 2003 and reviews of the financial statements included
in the Corporation's Forms 10-Q for such year were $59,838. Such fees
for the fiscal year ended June 30, 2002 were $48,500.
Audit-Related Fees; Tax Fees; All Other Fees. Deloitte &
Touche LLP did not render any other services to the Corporation for
the fiscal years ended June 30, 2003 and June 30, 2002.
Audit Report
The Board does not have an audit committee. The Board as a
whole is responsible for the oversight of the Corporation's accounting
and financial reporting practices. Management is responsible for
preparing the Corporation's financial statements and the independent
auditors are responsible for auditing those statements.
In discharging its oversight responsibility, the Board (1)
reviewed and discussed the audited financial statements of the
Corporation at and for the fiscal year ended June 30, 2003 with
management, (2) received from the independent auditors in writing the
matters required to be communicated by Statement on Auditing Standards
No. 61, (3) received the written disclosures and the letter from the
independent auditors required by the Independence Standards Board's
Standard No. 1 and (4) discussed with the independent auditors the
matters referred to in Statement on Auditing Standards No. 61 and the
auditors' independence from the Corporation.
Based on the reviews and discussions referred to above, the
Board included the Corporation's audited financial statements in the
Corporation's Annual Report on Form 10-K for the fiscal year ended
June 30, 2003, for filing with the Securities and Exchange Commission.
Submitted by the Board of Directors,
Alexander A. Cameron
Frances D. Dewey
John H.D. Dewey
LTG James M. Link (USA Ret)
Nathaniel Roberts
STOCKHOLDER PROPOSALS
Any proposals of stockholders which are intended to be presented
at the Corporation's next annual meeting of stockholders must be
received by the Corporation for inclusion in the Corporation's proxy
statement and form of proxy relating to such meeting not later than
July 3, 2004. If a stockholder proposal is received by the
Corporation after September 16, 2004, the persons named as proxies in
the form of proxy for the Corporation's 2004 Annual Meeting of
Stockholders will be entitled to exercise their discretionary voting
power with respect to such proposal.
DISCRETIONARY AUTHORITY
While the notice of annual meeting of stockholders calls for
transaction of such other business as may come before the meeting,
management has no knowledge of any matters to be presented for action
by the stockholders other than as set forth above. The accompanying
form of proxy gives discretionary authority, however, in the event
that any additional matters should be presented.
By Order of the Board of Directors
FRANCES D. DEWEY
Secretary
October 31, 2003
REVOCABLE PROXY
THE DEWEY ELECTRONICS CORPORATION
__PLEASE MARK VOTES AS IN THIS EXAMPLE
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints FRANCES D. DEWEY AND JOHN H.D. DEWEY,
or either of them, with power of substitution, attorneys and proxies
to represent the undersigned at the annual meeting of stockholders of
The Dewey Electronics Corporation to be held on December 3, 2003 at
10:30 A.M. (Eastern Standard Time) at the offices of the Corporation
at 27 Muller Road, Oakland, New Jersey, and any adjournments thereof
with all power which the undersigned would possess if personally
present and to vote all shares of common stock of the Corporation held
by the undersigned, which may be entitled to vote at said meeting upon
the following matter and upon other matters as may come before the
meeting.
1. ELECTION OF DIRECTORS FOR WITHHOLD FOR ALL
EXCEPT
(except as marked to the contrary below)
Alexander Cameron, Frances D. Dewey, John H.D. Dewey, James M.
Link,
Nathaniel Roberts
INSTRUCTION: To withhold authority to vote for any individual
nominee, mark "For All Except" and write that nominee's name in the
space provided below:
This proxy, when properly executed, will be voted in the manner
directed herein. If no direction is given, this proxy will be voted
FOR the election of the nominees listed above.
Please sign exactly as your name appears hereon. When shares are held
by joint tenants, both should sign. When signing as attorney, as
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 authorized person.
Please be sure to sign and date this
Date_______________
Proxy in the box below.
_______________________________ _____________________________
Stockholder sign above Co-holder (if any
sign above)
10