SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For February 26, 2004
BONSO ELECTRONICS INTERNATIONAL INC.
------------------------------------
(Translation of Registrant's name into English)
Unit 1106-1110, 11/F., Star House 3 Salisbury Road,
Tsimshatsui Kowloon, Hong Kong
------------------------------
(Address of principal executive offices)
[Indicate by check mark whether the Registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.]
Form 20-F [X] Form 40-F [ ]
[Indicate by check mark whether the Registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.]
Yes [ ] No [X]
BONSO ELECTRONICS INTERNATIONAL INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
FOR THE FISCAL YEAR ENDED MARCH 31, 2003
TO BE HELD MARCH 23, 2004
Notice is hereby given that an annual meeting of the shareholders (the
"Shareholders") of Bonso Electronics International Inc., a British Virgin
Islands corporation (the "Corporation" or "Bonso"), will be held at 9:00 a.m.,
local time, on March 23, 2004, at the Courtyard Hotel by Marriott located at 30
Hubbard Street, Chicago Illinois 60611 and any adjournments or postponements
thereof (the "Meeting" or "Annual Meeting") for the following purposes:
1. To elect the following seven (7) persons to serve as directors of the
Corporation until the next Annual Meeting of Shareholders and
thereafter until their successors shall have been elected and
qualified: Anthony So; Kim Wah Chung; Cathy Kit Teng Pang; Woo Ping
Fok; John Stewart Jackson IV; George O'Leary; and Henry F. Schlueter;
2. To approve and ratify the Corporation's 2004 Stock Option Plan (the
"Plan"), which authorizes the granting of stock options to purchase up
to 600,000 shares of the Corporation's $0.003 par value common stock
("Common Stock") that may be granted under the Plan;
3. To ratify the selection of PricewaterhouseCoopers as the independent
public accountants of the Corporation for the fiscal year ending March
31, 2004; and
4. To consider and act upon such other business as may properly come
before the Meeting or any adjournments thereof.
Only Shareholders of record at the close of business on February 13, 2004,
shall be entitled to notice of and to vote at the meeting or any adjournments
thereof. All Shareholders are cordially invited to attend the Meeting in person.
By Order of the Board of Directors
February 16, 2004 Anthony So, Chairman and
Hong Kong Chief Executive Officer
IF YOU DO NOT EXPECT TO BE PRESENT AT THE MEETING AND WISH YOUR SHARES OF COMMON
STOCK TO BE VOTED, YOU ARE REQUESTED TO SIGN AND MAIL PROMPTLY THE ENCLOSED
PROXY WHICH IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. A RETURN
ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES IS ENCLOSED
FOR THAT PURPOSE.
BONSO ELECTRONICS INTERNATIONAL INC.
Star House 11/F
Unit 1106 - 1110
3 Salisbury Road
Tsimshatsui
Kowloon, Hong Kong
PROXY STATEMENT
DATED FEBRUARY 16, 2004
ANNUAL MEETING OF SHAREHOLDERS
FOR THE FISCAL YEAR ENDED MARCH 31, 2003
TO BE HELD ON MARCH 23, 2004
GENERAL
-------
This Proxy Statement is being furnished to the Shareholders of Bonso
Electronics International Inc. ("Bonso" and "Corporation") in connection with
the solicitation of proxies by the Board of Directors of the Corporation (the
"Board of Directors") from the Shareholders of the Corporation for use at the
Annual Meeting of the Shareholders to be held at 9:00 a.m., local time, on March
23, 2004, at the Courtyard Hotel by Marriott located at 30 Hubbard Street,
Chicago Illinois 60611, and any adjournments or postponements thereof. This
Proxy Statement, Notice of Annual Meeting of Shareholders, and the accompanying
Proxy Card are first being mailed to Shareholders on or about February 13, 2004.
VOTING SECURITIES AND VOTE REQUIRED
-----------------------------------
Only Shareholders of record at the close of business on February 13, 2004
(the "Record Date"), are entitled to notice of and to vote the shares of Common
Stock of the Corporation held by them on such date at the Meeting or any and all
adjournments thereof. As of the Record Date, 5,679,783 shares of Common Stock
were outstanding. There was no other class of voting securities outstanding at
that date.
Each share of Common Stock held by a Shareholder entitles such Shareholder
to one vote on each matter that is voted upon at the Meeting or any adjournments
thereof.
The presence, in person or by proxy, of the holders of one-third of the
outstanding shares of Common Stock is necessary to constitute a quorum at the
Meeting. Assuming that a quorum is present, the affirmative vote of the holders
of a majority of the shares of Common Stock represented at the Meeting in person
or by proxy and entitled to vote will be required to approve Proposals 1, 2 and
3 and to adopt the resolutions of the Shareholders corresponding to such
proposals.
Abstentions and broker "non-votes" will be counted toward determining the
presence of a quorum for the transaction of business; however, abstentions will
have the effect of a negative vote on the proposals being submitted. Abstentions
may be specified on the proposal to ratify the selection of
PricewaterhouseCoopers as the independent accountants of the Corporation. A
broker "non-vote" will have no effect on the outcome of any of the proposals.
If the accompanying Proxy Card is properly signed and returned to the
Corporation and not revoked, it will be voted in accordance with the
instructions contained therein. Unless contrary instructions are given, the
persons designated as proxy holders in the accompanying Proxy Card will vote
"FOR" each proposal to be considered by the Shareholders at the Meeting or, if
no such recommendation is given, in their own discretion. The Corporation's
executive officers and directors have advised the Corporation that they intend
to vote their shares (including those shares over which they hold voting power),
representing approximately 2,290,378 shares or 40.3% of the outstanding shares
of Common Stock as of February 5, 2004, in favor of each of the proposals above.
Each Proxy granted by a Shareholder may be revoked by such Shareholder at any
time thereafter by writing to the Secretary of the Corporation prior to the
Meeting, or by execution and delivery of a subsequent Proxy or by attendance and
voting in person at the Meeting, except as to any matter or matters upon which,
prior to such revocation, a vote shall be cast pursuant to the authority
conferred by such Proxy.
The cost of soliciting these Proxies, consisting of the printing, handling,
and mailing of the Proxy and related material, and the actual expense incurred
by brokerage houses, custodians, nominees and fiduciaries in forwarding proxy
materials to the beneficial owners of the shares of Common Stock, will be paid
by the Corporation.
In order to assure that there is a quorum, it may be necessary for certain
officers, directors, regular employees and other representatives of the
Corporation to solicit Proxies by telephone, facsimile or in person. These
persons will receive no extra compensation for their services.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table shows the number of shares of Common Stock beneficially
owned by each shareholder of the Corporation who beneficially owns 5% or more of
the Corporation's Common Stock and the Corporation's directors and executive
officers, both individually and as a group, as of February 5, 2004:
Total Number of
Shares of Shares of
Common Stock Common Stock Percent of
Owned of Options and Beneficially Beneficial
Name Record Warrants Held Owned Ownership
---- ------ ------------- ----- ---------
Anthony So 1,626,195(1) 636,500(2) 2,262,695 35.83%
Kim Wah Chung 93,700 115,000(3)(4)(5) 208,700 3.60%
Cathy Kit Teng Pang 35,438 115,000(3)(4)(5) 150,438 2.60%
Henry F. Schlueter 24,000 20,000(6)(7) 44,000 0.77%
Woo-Ping Fok 48,407 40,000(8),(9) 88,407 1.54%
George O'Leary 0 40,000(8),(9) 40,000 0.69%
W. Douglas Moreland 501,400 0 501,400 8.83%
All Directors and Officers 2,290,378 997,000 3,286,815 49.24%
as a group (7 persons)
(1) Includes 1,143,421 shares of common stock owned of record by a corporation
that is wholly owned by a trust of which Mr. So is the sole beneficiary.
(2) Includes options to purchase 158,000 shares of common stock at an exercise
price of $8.00 per share expiring January 6, 2010, options to purchase
128,000 shares of common stock at an exercise price of $3.65 per share
expiring on April 9, 2011, options to purchase 128,000 shares of common
stock at an exercise price of $2.50 per share expiring on March 6, 2012,
and options to purchase 222,500 shares of common stock at an exercise price
of $1.61 per share expiring on April 1, 2013.
(3) Includes options to purchase 20,000 shares of common stock at an exercise
price of $8.00 per share expiring January 6, 2010.
(4) Includes options to purchase 20,000 shares of common stock at an exercise
price of $3.65 per share expiring on April 9, 2011, and options to purchase
20,000 shares of common stock at an exercise price of $2.50 per share
expiring on March 6, 2012.
(5) Includes options to purchase 55,000 shares of common stock at an exercise
price of $1.61 per share expiring on April 1, 2013.
(6) Includes options to purchase 10,000 shares of common stock at an exercise
price of $8.00 per share expiring January 6, 2010.
(7) Includes options to purchase 10,000 shares of common stock at an exercise
price of $1.61 per share expiring on April 1, 2013.
(8) Includes options to purchase 10,000 shares of common stock at an exercise
price of $8.125 per share expiring January 12, 2010.
(9) Includes 461,975 shares held by Mr. Jackson and 600 shares held by Mr.
Jackson's wife.
(10) Includes options to purchase 10,000 shares of common stock at an exercise
price of $7.875 per share expiring on January 9, 2011, options to purchase
10,000 shares of common stock at an exercise price of $2.55 per share
expiring on October 15, 2011 and options to purchase 10,000 shares of
common stock at an exercise price of $1.61 per share expiring on April 1,
2003.
There are no arrangements known to the Corporation the operation of which
may at a subsequent date result in a change in control of the Corporation.
BOARD COMMITTEES
On October 1, 1994, the Board of Directors appointed, and has since
maintained, an Audit Committee of the Corporation. The Committee was established
to (i) review and approve the scope of audit procedures employed by the
Corporation's independent auditors; (ii) review and approve the audit reports
rendered by the Corporation's independent auditors; (iii) approve the audit fee
charged by the independent auditors; (iv) report to the Board of Directors with
respect to such matters; (v) recommend the selection of independent auditors;
and (vi) discharge such other responsibilities as may be delegated to it from
time to time by the Board of Directors and to discharge such other
responsibilities as may be delegated to it from time to time by the Board of
Directors. Effective as of August 17, 2000, the Board of Directors adopted a
formal charter for its Audit Committee. Messrs. Woo Ping Fok and Henry F.
Schlueter are members of our Audit Committee. Mr. Woo Ping Fok acts as chairman
of the Audit Committee. Messrs. Woo Ping Fok is "independent" as defined in the
NASDAQ listing standards; however, Mr. Schlueter is not "independent" under
those standards.
COMPENSATION OF OFFICERS AND DIRECTORS
The aggregate amount of compensation paid by us and our subsidiaries during
the year ended March 31, 2003 to all directors and officers as a group for
services in all capacities was approximately $1,269,574 including compensation
in the form of housing in Hong Kong for our Chairman and Chief Executive Officer
and our Director of Engineering and Research and Development, which is
consistent with the practice of other companies in Hong Kong. Total compensation
for the benefit of Anthony So was $671,836, for the benefit of Cathy Kit Teng
Pang was $125,262, for the benefit of Kim Wah Chung was $149,606, for the
benefit of Mr. George O'Leary was $180,000, and for the benefit of Henry F.
Schlueter was an aggregate of $142,870. The $142,870 listed as having been paid
for the benefit of Mr. Schlueter was paid to his law firm, Schlueter &
Associates, P.C. for legal services rendered and expenses incurred.
We did not set aside or accrue any amounts to provide pension, retirement
or similar benefits for directors and officers for the fiscal year ended March
31, 2003, other than contributions to our Provident Fund Plan which aggregated
$33,553 for officers and directors during the fiscal year ended March 31, 2003.
Employment Agreements
We have employment agreements with Anthony So, Kim Wah Chung and Cathy Kit
Teng Pang. The employment agreements expire on March 31, 2008; however, they are
automatically renewable on an annual basis for additional one-year increments.
Mr. So's employment agreement provides for a yearly salary of $700,000 per year
plus bonus. Mr. Chung's employment agreement provides for a yearly salary of
$150,000 per year plus bonus and Ms. Pang's employment agreement provides for a
yearly salary of $135,000 per year plus bonus. The employment agreements contain
provisions under which we will be obligated to pay Mr. So, Mr. Chung and Ms.
Pang all compensation for the remainder of their employment agreements and five
times their annual salary and bonus compensation upon a change of control, as
defined in the agreements.
Options of Directors and Senior Management
The following table provides information concerning options owned by the
directors and senior management at February 13, 2004. The table excludes our
publicly traded warrants owned by the directors and senior management,
information about which is disclosed in the section captioned "Security
Ownership of Certain Beneficial Owners and Management," together with
information concerning the beneficial ownership of our common shares by
directors and senior management and major shareholders.
Number of Common Shares
Subject to Exercise Price
Name Stock Options Per Share Expiration Date
---- ------------- --------- ---------------
Anthony So 158,000 $8.00 January 6, 2010
128,000 $3.65 April 9, 2011
128,000 $2.50 March 6, 2012
222,500 $1.61 April 1, 2013
Kim Wah Chung 20,000 $8.00 January 6, 2010
20,000 $3.65 April 9, 2011
20,000 $2.50 March 6, 2012
55,000 $1.61 April 1, 2013
Cathy Kit Teng Pang 20,000 $8.00 January 6, 2010
20,000 $3.65 April 9, 2011
20,000 $2.50 March 6, 2012
55,000 $1.61 April 1, 2013
George O'Leary 10,000 $8.125 January 12, 2010
10,000 $7.875 January 9, 2011
10,000 $2.55 October 15, 2011
10,000 $1.61 April 1, 2013
Woo-Ping Fok 10,000 $8.125 January 12, 2010
10,000 $7.875 January 9, 2011
10,000 $2.55 October 15, 2011
10,000 $1.61 April 1, 2013
J. Stewart Jackson IV 10,000 $7.875 January 9, 2011
10,000 $2.55 October 15, 2011
10,000 $1.61 April 1, 2013
Henry F. Schlueter 10,000 $8.00 January 6, 2010
10,000 $1.61 April 1, 2013
Directors
Except for that mentioned above, our directors do not receive any
additional monetary compensation for serving in their capacities. However,
outside directors receive stock options pursuant to the 1996 Non-Employee
Directors' Stock Option Plan and have been granted other options. (See "Stock
Option Plans -- The 1996 Non-Employee Directors' Stock Option Plan," below.) All
directors are reimbursed for all reasonable expenses incurred in connection with
services as a director.
Provident Fund Plan
Our wholly-owned foreign subsidiary, Bonso Electronics Limited ("BEL"),
started a Provident Fund Plan (the "Plan") effective January 1, 1998, with a
major international assurance company to provide life insurance and retirement
benefits for its employees. All permanent full time employees who joined BEL
before December 2000, excluding factory workers, are eligible to join the Plan.
Members of the Plan are required to contribute 5% of their monthly salary.
The contribution by BEL is as follows:
Years of Service % of salary as BEL's contribution
---------------- ---------------------------------
Less than 5 years 5.0%
5 to 10 years 7.5%
More than 10 years 10.0%
The Mandatory Provident Fund (the "MPF") was introduced by the Hong Kong
Government in December 2000. BEL joined the MPF with a major international
assurance company. All permanent full time employees who joined BEL in or after
December 2000, excluding factory workers, are eligible to join the MPF. Members'
and employers' each contribute 5% of the members' monthly salaries to the MPF
and are subject to a maximum contribution of HK$1,000 monthly.
At normal retirement age, death or ill health, the member shall be entitled
to receive from the Plan a lump sum equal to the total of the member's and BEL's
contributions plus a return on their investment. On resignation prior to normal
retirement age, a member shall be entitled to receive from the Plan a lump sum
equal to the member's contributions plus a percentage of the employer's balance
determined in accordance with a predetermined set scale.
BEL's total contributions to the Plan and the MPF for the years ended March
31, 2003, 2002 and 2001 amounted to $73,945, $78,995, and $53,704, respectively.
Compensation Pursuant to Options to Purchase Common Stock
Outside, non-employee directors receive stock options pursuant to the 1996
Non-Employee Directors' Stock Option Plan and have been granted other options.
In October 1996, the Board of Directors adopted a 1996 Non-Employee Directors'
Stock Option Plan which provided for the grant of options to purchase an
aggregate of not more than 100,000 shares of the Corporation's Common Stock. In
January 2000, the Shareholders approved the proposal of the Board of Directors
to increase from 100,000 to 600,000 in the aggregate number of options to
purchase Common Stock of the Corporation under the Non-Employee Directors' Plan.
The purpose of the 1996 Non-Employee Directors' Stock Option Plan is to promote
the long-term success of the Corporation by creating a long-term mutuality of
interests between the non-employee directors and the stockholders of the
Corporation, to provide an additional inducement for the non-employee directors
to remain with the Corporation and to provide a means through which the
Corporation may attract able persons to serve as directors of the Corporation.
The 1996 Non-Employee Directors' Stock Option Plan is administered by a
committee appointed by the Board of Directors.
Under the 1996 Non-Employee Directors' Stock Option Plan, on the third
business day following each annual meeting of the stockholders, each director
who is not then an employee of the Corporation or any of its subsidiaries will
automatically be granted a stock option to purchase 10,000 shares of Common
Stock. The exercise price of all options granted under the 1996 Non-Employee
Directors' Stock Option Plan will be equal to the fair market value of the
underlying shares on the date of grant, based on guidelines set forth in the
plan. The exercise price may be paid in cash, by the surrender of options, in
Common Stock, in other property, including a promissory note from the optionee,
or by a combination of the above, at the discretion of the committee
administering the 1996 Non-Employee Directors' Stock Option Plan. The term of
each option granted pursuant to the 1996 Non-Employee Directors' Stock Option
Plan will be ten years from the date of grant; however, no option may be
exercised during the first six months of its term. The term of an option granted
pursuant to the 1996 Non-Employee Directors' Stock Option Plan may be reduced in
the event that the optionee ceases to be a director of the Corporation. No
option granted pursuant to the plan will be transferable otherwise than by will
or the laws of descent and distribution.
Employee directors may receive stock options pursuant to the Corporation's
1996 Stock Option Plan. In October 1996, the Board of Directors adopted the 1996
Stock Option Plan which provided for the grant of options to purchase an
aggregate of not more than 400,000 shares of the Corporation's Common Stock. In
January 2000, the shareholders of the Corporation approved the proposal of the
Board of Directors to increase from 400,000 to 900,000 in the aggregate the
number of options to purchase Common Stock of the Corporation under the 1996
Stock Option Plan. The purpose of the 1996 Stock Option Plan is to make options
available to management and employees of the Corporation in order to encourage
them to secure or increase on reasonable terms their ownership of Common Stock
in the Corporation and to encourage them to remain in the employ of the
Corporation.
The 1996 Stock Option Plan is administered by a committee appointed by the
Board of Directors which determines the persons to be granted options under the
plan, the number of shares subject to each option, the exercise price of each
option and the option period, subject to the requirement that no option may be
exercisable more than 10 years after the date of grant. The exercise price of an
option may be less than fair market value of the underlying shares of Common
Stock. No options granted under the plan will be transferable by the optionee
other than by will or the laws of descent and distribution and each option will
be exercisable, during the lifetime of the optionee, only by the optionee.
The exercise price of an option granted pursuant to the 1996 Stock Option
Plan may be paid in cash, by the surrender of options, in Common Stock, in other
property, including a promissory note from the optionee, or by a combination of
the above, at the discretion of the committee administering the 1996 Stock
Option Plan.
CERTAIN TRANSACTIONS
Over the years, the Corporation has provided to and received cash advances
from its officers and directors. In October 1994, the Board of Directors adopted
a policy resolution prohibiting the Corporation from making any loan or advance
of money or property, or guaranteeing the obligation of any directors of the
Corporation, and limiting the Corporation's ability to make such loans, advances
or guarantees to officers of the Corporation or its subsidiaries unless a
majority of independent, disinterested outside directors determine that such
loan, advance or guarantee may reasonably be expected to benefit the
Corporation. Further, all future material affiliated transactions, loans and
loan guarantees, if any, will be made on terms that are no less favorable to the
Corporation than those that are generally available from unaffiliated third
parties. The Corporation has neither provided nor received any cash advances to
its officers or directors since this policy resolution was adopted.
It is common practice in Hong Kong, the location of the Corporation's
principal executive offices, to provide a housing allowance or living
accommodations for senior executives as part of their compensation. One of the
Corporation's properties in Hong Kong is provided to Mr. So as part of his
compensation. The Corporation also provides Mr. Chung with a housing allowance.
Mr. George O'Leary, a director, is paid a consulting fee by the Corporation
for support and marketing services such as soliciting customers, negotiating
prices and public relations in the United States. During the fiscal year ended
March 31, 2003, Mr. O'Leary was paid a consulting fee of $180,000.
During the fiscal year ended March 31, 2003 we paid Schlueter & Associates,
P.C. an aggregate of $142,870 for legal fees and expenses. Mr. Henry F.
Schlueter, a director, is the Managing Director of Schlueter & Associates, P.C.
PROPOSAL 1
ELECTION OF SEVEN (7)
PERSONS TO SERVE AS DIRECTORS OF THE CORPORATION
The Corporation's directors are elected annually to serve until the next
Annual Meeting of Shareholders and thereafter until their successors shall have
been elected and qualified. The number of directors presently authorized by the
Articles of Association of the Corporation shall be not less than one (1) nor
more than seven (7).
Unless otherwise directed by Shareholders, the proxy holder will vote all
shares represented by proxies held by them for the election of the following
nominees, all of whom are now members and constitute the Corporation's Board of
Directors. The Corporation is advised that all nominees have indicated their
availability and willingness to serve if elected. In the event that any nominee
becomes unavailable or unable to serve as a director of the Corporation prior to
the voting, the proxy holder will vote for a substitute nominee in the exercise
of his best judgment.
INFORMATION CONCERNING NOMINEES
Anthony So, 60, is the founder of Bonso. He is our Chief Executive Officer
and Chief Financial Officer and has been our President, Chairman of the Board of
Directors and Treasurer since inception, and our Secretary since July 1991. Mr.
So received his BSE degree in civil engineering from National Taiwan University
in 1967 and a master's degree in business administration ("MBA") from the Hong
Kong campus of the University of Hull, Hull, England in 1994. Mr. So has been
Chairman of the Hong Kong GO Association since 1986, and also served as Chairman
of the Alumni Association of National Taiwan University for the 1993-1994
academic year. Mr. So has served as a trustee of the Chinese University of Hong
Kong, New Asia College since 1994.
Kim Wah Chung, 45, has been a director since September 21, 1994. Mr. Chung
has been employed by us since 1981 and currently holds the position of Director
of Engineering and Research and Development. Mr. Chung is responsible for all
research projects and product development. Mr. Chung's entire engineering career
has been spent with Bonso, and he has been involved in all of our major product
developments. Mr. Chung graduated with honors in 1981 from the Chinese
University of Hong Kong with a Bachelor of Science degree in electronics.
Cathy Kit Teng Pang, 41, has been a director of Bonso since January 1,
1998. Ms. Pang was first employed by us as Financial Controller in December 1996
and was promoted to Director of Finance on April 1, 1998. Ms. Pang was employed
as an auditor in an international audit firm from 1987 to 1991, at which time
she joined a Hong Kong listed company in the field of magnetic industry as
Assistant Financial Controller. From 1994 until she joined us in 1996, she was
employed as Deputy Chief Accountant in a management and property development
company in Hong Kong and China. Ms. Pang has a Bachelor of Business
Administration degree from York University in Toronto, Canada. She is a member
of the American Institute of Certified Public Accountants and of the Hong Kong
Society of Accountants.
Woo-Ping Fok, 54, was elected to our Board of Directors on September 21,
1994. Mr. Fok has practiced law in Hong Kong since 1991 and is a partner with
Wong & Fok. Mr. Fok's major areas of practice include conveyancing or real
property law, corporations and business law, commercial transactions and
international trade with a special emphasis in China trade matters. Mr. Fok was
admitted to the Canadian Bar as a Barrister & Solicitor in December 1987 and was
a partner in the law firm of Woo & Fok, a Canadian law firm with its head office
in Edmonton, Alberta, Canada. In 1991, Mr. Fok was qualified to practice as a
Solicitor of England & Wales, a Solicitor of Hong Kong and a Barrister &
Solicitor of Australian Capital Territory.
J. Stewart Jackson IV, 68, has been a director since January 10, 2000. From
1962 until its merger with Republic Industries in 1996, Mr. Jackson served in
various management capacities, including president, of Denver Burglar Alarm Co.,
Inc., a business founded by his family. In addition, in the mid-1960's, Mr.
Jackson founded Denver Burglar Alarm Products, a separate company which
invented, patented, manufactured, distributed and installed contained ionization
smoke detectors and which was later sold to a conglomerate manufacturer. After
the merger of Denver Burglar Alarm Co., Inc., Mr. Jackson founded Jackson
Burglar Alarm Co., Inc., of which he is currently president. Mr. Jackson served
on the advisory board of directors for Underwriter's Laboratories for burglar
and fire alarm systems for 25 years and has been an officer in the Central
Station Protection Association, which, along with the National Burglar Alarm
Association, was formed by his family in the late 1940's. Mr. Jackson graduated
from the University of Colorado in 1962 with a degree in Business Management and
Engineering.
George O'Leary, 65, has been a director since January 1997. From November
1994 to the present time, Mr. O'Leary has been President of Pacific Rim
Products, Newport Beach, California, a trading company that provides offshore
sourcing alternatives to U.S. based electronics companies. For eight years prior
to 1994, Mr. O'Leary was President, CEO and a director of Micro General
Corporation, Santa Ana, California, a manufacturer and distributor of mechanical
and electronic scale products. For eight years prior to that, Mr. O'Leary was
Vice President and General Manager of Lanier Business Products, Atlanta,
Georgia, a manufacturer and distributor of office products. Mr. O'Leary has a
Bachelor of Science degree in Electrical Engineering from Northeastern
University, Boston, Massachusetts.
Henry F. Schlueter, 53, has been a director since October 2001, and has
been our Assistant Secretary since October 6, 1988. Since 1992, Mr. Schlueter
has been the Managing Director of Schlueter & Associates, P.C., a law firm,
practicing in the areas of securities, mergers and acquisitions, finance and
corporate law. Mr. Schlueter has served as our United States corporate and
securities counsel since 1988. From 1989 to 1991, prior to establishing
Schlueter & Associates, P.C., Mr. Schlueter was a partner in the Denver,
Colorado office of Kutak Rock (formerly Kutak, Rock & Campbell), and from 1984
to 1989, he was a partner in the Denver office of Nelson & Harding. Mr.
Schlueter is a member of the American Institute of Certified Public Accountants,
the Colorado Society of CPA's, the Colorado and Denver Bar Associations and the
Wyoming State Bar.
There are no family relationships between any of our directors and
executive officers.
No arrangement or understanding exists between any such director or officer
and any other persons pursuant to which any director or executive officer was
elected as a director or executive officer. Our directors are elected annually
and serve until their successors take office or until their death, resignation
or removal. The executive officers serve at the pleasure of the Board of
Directors.
Board Recommendation
The Board of Directors recommends a vote FOR the election of each of the
seven (7) nominees for directors of the Corporation.
PROPOSAL 2
PROPOSAL TO ADOPT, APPROVE AND RATIFY THE
2004 Stock Option Plan
Effective February 10, 2004, the Corporation's Board of Directors adopted
and approved the Corporation's 2004 Stock Option Plan (the "Plan"). The
following summary of the principal features of the Plan is qualified in its
entirety by reference to the terms and provisions of the Plan, a copy of which
is attached hereto as Exhibit A.
The Plan authorizes the granting of up to six hundred thousand (600,000)
shares of the Company's Common Stock in the form of stock options, subject to
certain adjustments as described in the Plan. The Company has not yet granted
any option or award under the Plan. All outstanding options described in this
Proxy Statement were granted outside the Plan.
The Corporation has not made any determination with respect to future
grants of options under the Plan and any grant of options will be made only in
accordance with the provisions of the Plan.
Purpose
The purpose of the Plan is to secure key employees to remain in the employ
of the Corporation and to encourage such employees to secure or increase on
reasonable terms their Common Stock ownership in the Corporation. The
Corporation believes that Plan will promote continuity of management and
increased incentive and personal interest in the welfare of the Corporation.
Administration
The Plan shall be administered by a committee (the "Committee") appointed
by the Board of Directors which consists of at least two but not more than three
members of the Board, one of who shall be a non-employee of the Corporation. The
initial Committee members shall be Anthony So and Woo Ping Fok. The Committee
shall determine the specific terms of the options granted, including the
employees to be granted options under the plan, the number of shares subject to
each option grant, the exercise price of each option and the option period,
subject to the requirement that no option may be exercisable more than 10 years
after the date of grant. The exercise price of an option may be less than fair
market value of the underlying shares of Common Stock. No options granted under
the plan will be transferable by the optionee other than by will or the laws of
descent and distribution and each option will be exercisable, during the
lifetime of the optionee, only by the optionee.
Exercise of Options
The exercise price of an option granted pursuant to the 2004 Stock Option
Plan may be paid in cash, by the surrender of options, in Common Stock, in other
property, including a promissory note from the optionee, or by a combination of
the above, at the discretion of the Committee.
Stock Subject to Plan
The Plan authorizes the issuance of up to six hundred thousand (600,000)
shares of the Corporation's Common Stock. The Plan further provides that in the
event of changes in the Common Stock of the Company by reason of stock dividend,
stock split-up, reorganization, recapitalization, merger, consolidation,
business combination or exchange of shares, there shall be substituted the
number and kind of shares of stock or securities into which each outstanding
share of Common Stock shall be so changed or for which each such share shall be
exchanged. In the event of any additional change, other than as specified above,
then the Committee shall, in its sole discretion, determine the adjustment in
the number or kind of shares or securities subject to an option or options.
Required Vote
Approval of the Plan requires the affirmative vote of a majority of the
shares present and voting at the meeting in person or by proxy.
Unless otherwise directed by Shareholders, the proxy holders will vote all
shares represented by Proxies held by them to approve 2004 Stock Option Plan.
PROPOSAL 3
RATIFICATION OF SELECTION OF ACCOUNTANTS
The Board of Directors has selected PricewaterhouseCoopers as the
independent public accountants of the Corporation for the fiscal year ending
March 31, 2004, and has further directed that the Corporation submit the
selection of the independent public accountants for ratification by Shareholders
at the Annual Meeting of Shareholders.
Unless otherwise directed by Shareholders, the proxy holders will vote all
shares represented by Proxies held by them to ratify the selection of
PricewaterhouseCoopers as the independent public accountants of the Corporation
for the fiscal year ending March 31, 2004.
Fees Paid to the Independent Auditors
Audit Fees
The aggregate fees billed by PricewaterhouseCoopers for professional
services rendered for the audit of the Corporation's annual consolidated
financial statements for the year ended March 31, 2003 were $119,872.
Tax Fees
The aggregate fees billed by PricewaterhouseCoopers for professional
services rendered for tax compliance, tax advice and tax planning for the year
ended March 31, 2003 ("Tax Fees") were $5,103.
All Other Fees
PricewaterhouseCoopers billed $10,256 for additional professional services
related to the review of our registration statement on Form F-2 during the
fiscal year ended March 31, 2003.
Board Recommendation
The Board of Directors recommends a vote FOR the ratification of the
selection of PricewaterhouseCoopers as the independent public accountants of the
Corporation for the fiscal year ending March 31, 2004.
GENERAL
Other Matters
The Board of Directors does not know of any matters that are to be
presented at the Annual Meeting of Shareholders other than those stated in the
Notice of Annual Meeting and referred to in this Proxy Statement. If any other
matters should properly come before the Meeting, it is intended that the Proxies
in the accompanying form will be voted as the persons named therein may
determine in their discretion.
By Order of the Board of Directors
Anthony So, Chairman of the Board of Directors
2004 STOCK OPTION PLAN
OF
BONSO ELECTRONICS INTERNATIONAL INC.
1. Purpose. The purpose of the Bonso Electronics International Inc. 2004
employees' stock option plan (the "Plan") is to induce key employees to remain
in the employ of Bonso Electronics International Inc., a British Virgin Island
international business company (hereinafter referred to as the "Company') or of
any subsidiary of the Company, and to encourage such employees to secure or
increase on reasonable terms their stock ownership in the Company. The Board of
Directors of the Company believes the Plan will promote continuity of management
and increased incentive and personal interest in the welfare of the Company by
those who are primarily responsible for shaping and carrying out the long-range
plans of the Company and securing its continued growth and financial success.
2. Effective Date of the Plan. The Plan shall become effective on February
10, 2004 the date adopted by the Board of Directors, subject to the later
adoption of the Plan by the Stockholders' of the Company at the next
Stockholders' meeting.
3. Stock Subject to Plan. The maximum number of common shares which may be
issued pursuant to the exercise of options granted under the Plan is six hundred
thousand (600,000) subject to the adjustments provided in paragraph 13 below.
Six hundred thousand (600,000) of the authorized but unissued common shares of
the Company will be reserved for issue upon exercise of options granted under
the Plan subject to the adjustments provided in paragraph 13 below; provided,
however, that the number of such authorized and unissued shares so reserved may
from time to time be reduced to the extent that a corresponding amount of issued
and outstanding shares have been purchased by the Company and set aside for
issue upon the exercise of options granted under the Plan. If any options shall
expire or terminate for any reason without having been exercised in full, the
unpurchased shares subject thereto shall again be available for further grants
under the Plan.
4. Administration. The Plan shall be administered by a Committee (the
"Committee") appointed by the Board of Directors of the Company (the "Board")
which consists of not less than two nor more than three members of the Board,
one of whom shall be the Chairman of the Board and the other members of the
Committee shall be non-employee members of the Board in order to be eligible to
be members of the Committee. The initial Committee shall consist of Anthony So
and Woo Ping Fok. The Committee Shall keep records of action taken at its
meetings. A majority of the Committee shall constitute a quorum at any meeting,
and the acts of a majority of the members present at any meeting at which a
quorum is present, or acts approved in writing by all the members of the
Committee, shall be the acts of the Committee. Acts of the Committee approved in
writing shall be effective at the time and date that the last member of the
Committee signs such writing unless the Committee members establish a different
effective time or date. Such action has the same effect as action taken at a
meeting of the Committee and may be described as such in any document. The
Chairman of the Board shall serve as the Chairman at all meetings of the
Committee. One or more members of the Committee may participate in Committee
meetings by, or conduct the meeting through the use of, any means of
communication by which all members of the Committee participating may hear each
other during the meeting. A Committee member participating in a meeting by this
means is deemed to be present in person at the meeting.
Subject to the express provisions of the Plan, the Committee shall have
complete authority, in its discretion, to determine those key employees and
directors (hereinafter referred to as "Participant(s)") to whom, and the price
at which options shall be granted, the option periods and the number of shares
to be subject to each option. The Committee shall also have the authority in its
discretion to prescribe the time or times at which the options may be exercised
and limitations upon the exercise of options (including limitations effective
upon the death or termination of employment of the Participant), and the
restrictions, if any, to be imposed upon the transferability of shares acquired
upon exercise of options. In making such determinations, the Committee may take
into account the nature of the services rendered by respective employees, their
present and potential contributions to the success of the Company or its
subsidiaries and such other factors as the Committee in its discretion shall
deem relevant. Subject to the express provisions of the Plan, the Committee
shall also have complete authority to interpret the Plan, to prescribe, amend
and rescind rules and regulations relating to the Plan, to determine the terms
and provisions of the respective options agreements (which need not be
identical), to determine whether the shares delivered upon exercise of stock
options will be treasury shares or will be authorized but previously unissued
shares, and to make all other determinations necessary or advisable for the
administration of the Plan. All determinations made by the Committee shall be
final and binding.
5. Eligibility. An option may be granted under the Plan only to officers or
other key employees or a director of the Company and of its present and future
subsidiary corporations. The granting of an option to any employee shall not
confer upon the employee any right to continue in the employ of the Company or
of any such subsidiary and shall not interfere in any way with the right of the
Company or of any such subsidiary to terminate the employment of the employee at
any time.
6. Option Price. The option price will be determined by the Committee at
the time the option is granted and may be granted at less than the fair market
value of the common shares on the date of grant as shall reasonably be
determined by the Committee.
7. Date of Option Grant. An option shall be considered granted on the date
the Committee acts to grant the option, or such date thereafter as the Committee
shall specify.
8. Term of Plan. The Board, without approval of the shareholders may
terminate the Plan at any time, but no termination shall, without the
Participant's consent, alter or impair any of the rights under any option
theretofore granted to him under the Plan.
9. Term of Options. The term of each option granted under the Plan will be
for such period (hereinafter referred to as the "option period") not exceeding
ten (10) years as the Committee shall determine. Each option shall be subject to
earlier termination as described under "exercise of options."
10. Exercise of Options.
(a) Each option granted under the Plan will be exercisable on such date or
dates and during such period and for such number of shares as shall be
determined pursuant to the provisions of the option agreement evidencing such
option. Subject to the express provisions of the Plan, the Committee shall have
complete authority, in its discretion, to determine the extent, if any, and the
conditions under which an option may be exercised in the event of the death of
the Participant or in the event the Participant leaves the employ of the Company
or has his employment terminated by the Company. An option may be exercised, by
(A) written notice of intent to exercise the option with respect to a specified
number of shares of stock, and (B) payment to the Company of the amount of the
option purchase price for the number of shares of stock with respect to which
the option is then exercised.
(b) The Committee shall determine the acceptable form of consideration for
exercising an option, including the method of payment. Such consideration may
consist entirely of:
(i) cash;
(ii) check;
(iii) promissory note;
(iv) other shares which (A) in the case of shares acquired upon
exercise of an option, have been owned by the optionee for more than six months
on the date of surrender, and (B) have a fair market value on the date of
surrender equal to the aggregate exercise price of the shares as to which said
option shall be exercised;
(v) consideration received by the Company under a cashless exercise
program implemented by the Company in connection with the Plan;
(vi) a reduction in the amount of any Company liability to the
optionee, including any liability attributable to the optionee's participation
in any Company sponsored deferred compensation program or arrangement;
(vii) such other consideration and method of payment for the issuance
of shares to the extent permitted by applicable laws; or
(viii) any combination of the foregoing methods of payment.
Notwithstanding the foregoing, any method of payment other than in cash may
be used only with the consent of the Committee, which consent may be withheld in
the sole discretion of the Committee, or if and to the extent so provided in an
Agreement.
11. Nontransferability. Options under the Plan are not transferable
otherwise than by will or the laws of descent or distribution, and may be
exercised during the lifetime of a Participant only by such Participant.
12. Agreements. Options granted pursuant to the Plan may be evidenced by
stock option agreements in such form as the Committee shall from time to time
adopt.
13. Adjustment of Number of Shares. In the event that a dividend shall be
declared upon the common shares of the Company payable in common shares of the
Company the number of common shares then subject to any such option and the
number of such shares reserved for issuance pursuant to the Plan but not yet
covered by an option, shall be adjusted by adding to each such share the number
of shares which would be distributable thereon if such share had been
outstanding on the date fixed for determining the shareholders entitled to
receive such stock dividend. In the event that the outstanding common shares of
the Company shall be changed into or exchanged for a different number or kind of
shares of stock or other securities of the Company or of another corporation,
whether through reorganization, recapitalization, stock split-up, combination of
shares, merger or consolidation, then there shall be substituted for each common
share reserved for issuance pursuant to the Plan, option, the number and kind of
shares of stock or there securities into which each outstanding common share
shall be so changed or for which each such share shall be exchanged. In the
event there shall be any change, other than as specified above in this paragraph
in the number or kind of outstanding common shares of the Company or of any
stock or other securities into which such common shares shall have been changed
or for which it shall have been exchanged, then if the Committee shall in sole
discretion determine that such change equitably requires an adjustment in the
number or kind of shares subject to an option or options, such adjustment shall
be made by the Committee and shall be effective and binding for all purposes of
the Plan and of each stock option agreement. The option price in each stock
option agreement for each share of stock or other securities substituted or
adjusted as provided for in this paragraph shall be determined by dividing the
option price in such agreement for each share prior to such substitution or
adjustment by the number of shares or the fraction of a share substituted for
such share or to which such share shall have been adjusted. No adjustment or
substitution provided for in this paragraph shall require the Company in any
stock option agreement to sell a fractional share, and the total substitution or
adjustment with respect to each stock option agreement shall be limited
accordingly.
14. Amendments. The Board, without approval of the shareholders, may from
time to time amend the Plan in such respects as the Board may deem advisable. No
amendment shall, without the Participant's consent, alter or impair any of the
rights or obligations under any option theretofore granted to him under the
Plan.
[REMAINDER OF THIS PAGE LEFT BLANK INTENTIONALLY]
In witness whereof, the Board of Directors of the Company has adopted this
Plan effective the 10th day of February, 2004.
BONSO ELECTRONICS INTERNATIONAL INC.
By:
----------------------------------------
Anthony So, Chairman of the Board,
Chief Executive Officer and President
BONSO ELECTRONICS INTERNATIONAL INC.
ANNUAL MEETING OF SHAREHOLDERS
MARCH 23, 2004
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder of Bonso Electronics International Inc., a
British Virgin Islands corporation (the "Corporation"), acknowledges receipt of
the Notice of Annual Meeting of Shareholders and Proxy Statement, dated February
16, 2004, and hereby appoints Anthony So and Henry F. Schlueter, or either of
them, each with the power of substitution, as Attorneys and Proxies to represent
and vote all shares of Common Stock of the Corporation which the undersigned
would be entitled to vote at the Annual Meeting of Shareholders and at any
adjournment or adjournments thereof, hereby revoking any proxy or proxies
heretofore given and ratifying and confirming all that said Attorneys and
Proxies may do or cause to be done by virtue thereof with respect to the
following matters:
1. Election of each of the following seven (7) persons to serve as
directors of the Corporation until the next Annual Meeting of
Shareholders and thereafter until their successors shall have been
elected and qualified:
Anthony So
FOR /___/ WITHHOLD AUTHORITY FOR /___/
Kim Wah Chung
FOR /___/ WITHHOLD AUTHORITY FOR /___/
Cathy Kit Teng Pang
FOR /___/ WITHHOLD AUTHORITY FOR /___/
Woo Ping Fok
FOR /___/ WITHHOLD AUTHORITY FOR /___/
John Stewart Jackson IV
FOR /___/ WITHHOLD AUTHORITY FOR /___/
George O'Leary
FOR /___/ WITHHOLD AUTHORITY FOR /___/
Henry F. Schlueter
FOR /___/ WITHHOLD AUTHORITY FOR /___/
2. Approval and ratification of the Corporation's 2004 Stock Option Plan.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. Approval of the ratification of the selection of
PricewaterhouseCoopers as the independent public accountants of the
Corporation for the fiscal year ending March 31, 2004.
FOR /___/ AGAINST /___/ ABSTAIN /___/
4. To act upon such other matters as may properly come before the Meeting
or any adjournments thereof.
This Proxy, when properly executed, will be voted as directed. If no direction
is indicated, the Proxy will be voted (1) FOR the election of each of the
nominees listed above to the Board of Directors; (2) FOR the approval and
ratification of the 2004 Stock Option Plan; and (3) FOR the approval of the
ratification of the selection of PricewaterhouseCoopers as the independent
public accountants of the Corporation for the fiscal year ending March 31, 2004.
Dated: _____________, 2004 _______________________________________
_______________________________________
[LABEL]
Please sign your name exactly as it appears hereon. When signing as attorney,
executor, administrator, trustee or guardian, please give your full title as it
appears hereon. When signing as joint tenants, all parties in the joint tenancy
must sign. When a proxy is given by a corporation, it should be signed by an
authorized officer and the corporate seal affixed. No postage is required if
returned in the enclosed envelope and mailed in the United States.
PLEASE SIGN, DATE AND MAIL THIS PROXY IMMEDIATELY IN THE ENCLOSED ENVELOPE.
Please sign exactly as THE name appears on the label ATTACHED TO THIS PROXY.
When shares are held by joint tenants, both should 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 person. If a partnership, please sign in full partnership name
by authorized person.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BONSO ELECTRONICS INTERNATIONAL, INC.
(Registrant)
Date: February 26, 2004 By: /s/ Henry F. Schlueter
----------------- ---------------------------
Henry F. Schlueter, Assistant Secretary