SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities and Exchange Act of 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
RESEARCH FRONTIERS INCORPORATED
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(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 how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fees paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date of
its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
June 11, 2009
To the Stockholders of Research Frontiers Incorporated:
Notice is hereby given that the Annual Meeting of Stockholders
of Research Frontiers Incorporated (the "Company") will be held at the
Fox Hollow Inn, 7725 Jericho Turnpike, Woodbury, New York 11797,
on June 11, 2009 at 11:00 A.M., local time, for the following purposes:
1. To elect two Class I directors and one Class II director;
2. To ratify the selection of BDO Seidman, LLP as the
independent registered public accountants of the Company for the
fiscal year ending December 31, 2009;
3. To transact such other business as may properly come before
the meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on April
17, 2009 as the record date for the determination of stockholders
entitled to notice of, and to vote at, the meeting or any adjournments
thereof.
Management requests all stockholders to sign and date the
enclosed form of proxy and return it in the postage paid, self-addressed
envelope provided for your convenience. Please do this whether or not
you plan to attend the meeting. Should you attend, you may, if you
wish, withdraw your proxy and vote your shares in person. BECAUSE
YOUR BROKER MAY NOT HAVE DISCRETION TO VOTE ON ALL OF THE ABOVE
MATTERS, IT IS IMPORTANT THAT YOU SEND IN YOUR PROXY.
By Order of the Board of Directors,
JOSEPH M. HARARY, Secretary
Woodbury, New York
April 30, 2009
RESEARCH FRONTIERS INCORPORATED
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
To be held Thursday, June 11, 2009
This Proxy Statement is furnished by the Board of Directors
of Research Frontiers Incorporated (the "Company") in connection
with the solicitation by the Company of proxies to be voted at the
Annual Meeting of Stockholders which will be held at the Fox
Hollow Inn, 7725 Jericho Turnpike, Woodbury, New York 11797,
on June 11, 2009, at 11:00 A.M., local time, and all adjournments
thereof.
Any stockholder giving a proxy will have the right to revoke
it at any time prior to the time it is voted. A proxy may be revoked
by written notice to the Company, Attention: Secretary, by
execution of a subsequent proxy or by attendance and voting in
person at the Annual Meeting of Stockholders. Attendance at the
meeting will not automatically revoke the proxy. All shares
represented by effective proxies will be voted at the Annual
Meeting of Stockholders, or at any adjournment thereof. Unless
otherwise specified in the proxy, shares represented by proxies
will be voted (i) for the election of the nominees for director listed
below, and (ii) for the ratification of the selection of the
independent registered public accountants. The cost of proxy
solicitations will be borne by the Company. In addition to
solicitations of proxies by use of the mails, some officers or
employees of the Company, without additional remuneration, may
solicit proxies personally or by telephone. The Company will also
request brokers, dealers, banks and their nominees to solicit
proxies from their clients, where appropriate, and will reimburse
them for reasonable expenses related thereto.
The Company's executive offices are located at 240
Crossways Park Drive, Woodbury, New York 11797-2033.
Research Frontiers believes that it can learn from constructive
dialog with shareholders and other stakeholders and therefore
actively encourages communications with all such interested
parties. All e-mail communications to Directors@SmartGlass.com
will be forwarded to each director of the Company. Furthermore,
subject to the limits imposed by SEC regulations regarding
disclosure of information that is not made generally available to all
shareholders at the same time, we will endeavor to respond to
specific questions or suggestions which, in the opinion of
management or the Board, merit individual response. On or about
May 2, 2009, this Proxy Statement and the accompanying form of
proxy, together with a copy of the Annual Report of the Company
for the year ended December 31, 2008, including financial
statements, are to be mailed to each stockholder of record at the
close of business on April 17, 2009.
Important Notice Regarding the Availability of Proxy
Materials for the Shareholders Meeting to Be Held on June
11, 2009
This Proxy Statement is available at
www.smartglass.com/proxy.asp.
VOTING SECURITIES
Only stockholders of record at the close of business on April
17, 2009 are entitled to vote at the meeting. As of April 17, 2009,
the Company had issued and outstanding and entitled to vote
15,742,784 shares of common stock, par value $0.0001 per share
(the "Common Stock"), the Company's only class of voting
securities outstanding. Each share of Common Stock entitles the
holder thereof to one vote.
As a shareholder of record, you may vote in person at the
Annual Meeting or you may vote by proxy without attending the
Meeting. If you are a registered shareholder, you may vote your
shares by giving a proxy via mail, telephone or Internet. To vote
your proxy by mail, indicate your voting choices, sign and date
your proxy card and return it in the postage-paid envelope
provided. You may vote by telephone or Internet by following the
instructions on your proxy card. If you hold your shares through
a broker, bank or other nominee, that institution will send you
separate instructions describing the procedure for voting your
shares.
If you provide a properly executed proxy before voting at the
Annual Meeting is closed, the persons listed on the Proxy card will
vote the proxy in accordance with your directions. If you do not
indicate how your shares are to be voted, the persons listed on the
Proxy card will vote your shares as recommended by the Board of
Directors. The persons listed on the Proxy card will also have the
discretionary authority to vote on your behalf on any other matter
that is properly brought before the Annual Meeting. If you wish to
give a proxy to someone other than the persons listed on the Proxy
card, please cross out the names of the people listed on the Proxy
card and add the name of the person holding your proxy.
If we receive a valid proxy before voting at the Annual
Meeting is closed, your shares are voted as indicated on the proxy
card. If you indicate on your proxy card that you wish to "abstain"
or "withhold," as the case may be, from voting on an item, your
shares will not be voted on that item. Abstentions will be counted
to determine whether there is a quorum present.
If you do not provide voting instructions to your broker or
nominee at least ten days before the Annual Meeting, that person
has discretion to vote your shares on matters that the New York
Stock Exchange has determined are routine. However, a broker or
nominee cannot vote shares on non-routine matters without your
instructions, and this is referred to as a "broker non-vote." Broker
non-votes are only counted in determining whether a quorum is
present. Even though your broker may have discretionary
authority to vote your shares on your behalf on the proposals
presented at this Annual Meeting, it is important that you vote
your shares and send in your proxy.
The Annual Meeting cannot conduct business unless a
quorum is present. In order to have a quorum, a majority of the
shares of the Company's common stock that are outstanding and
entitled to vote at the meeting must be represented in person or by
proxy. If a quorum is not present, the Annual Meeting will be
rescheduled for a later date.
Directors are elected by a plurality of the votes cast. The
management proposals described in the Proxy Statement must be
approved by the affirmative vote of a majority of the shares
present or represented by proxy and entitled to vote on this
proposal. Abstentions will have the same effect as votes against
the proposal. Broker non-votes will have no effect on the outcome
of the vote.
The following table sets forth certain information with respect
to those persons or groups known to the Company who
beneficially own more than 5% of the Company's Common Stock,
and for all directors and executive officers of the Company
individually and as a group.
Total Exercisable
Name of Beneficial Warrants Percent
Beneficial Owner Ownership(1) and Options of Class
Robert L. Saxe . . . . . . . . . . 1,285,338(2) 839,030 7.75
Joseph M. Harary . . . . . . . . . 659,174(3) 396,000 4.08
Robert M. Budin. . . . . . . . . . 271,377 219,200 1.70
M. Philip Guthrie. . . . . . . . . 52,500 25,000 0.33
Richard Hermon-Taylor. . . . . . . 56,525 25,000 0.36
Victor F. Keen . . . . . . . . . . 483,599 202,200 3.03
Michael R. LaPointe. . . . . . . . 153,259(4) 144,500 0.96
Steven M. Slovak . . . . . . . . . 94,384 85,500 0.60
All directors and officers
as a group (8 persons) . . . . . . 2,832,813(5) 1,936,430 16.02
(1) All information is as of April 17, 2009 and was determined in
accordance with Rule 13d-3 under the Securities Exchange
Act of 1934 based upon information furnished by the persons
listed or contained in filings made by them with the Securities
and Exchange Commission or otherwise known to the
Company. Unless otherwise indicated, beneficial ownership
disclosed consists of sole voting and dispositive power, and
also includes options and warrants held by the listed persons
that are presently exercisable or exercisable within the next
60 days, and awards of restricted stock subject to vesting are
assumed to be fully issued and outstanding. Shares of
Common Stock of the Company acquired by officers,
directors and employees through the exercise of stock options
or otherwise are subject to restrictions on their transfer,
including restrictions imposed by applicable securities laws,
as well as additional restrictions imposed by the Company in
accordance with written agreements and policy statements.
The mailing address for the above individuals is c/o Research
Frontiers Incorporated, 240 Crossways Park Drive,
Woodbury, NY 11797.
(2) Includes (i) 2,687 shares of Common Stock owned by the
estate of Mr. Saxe's wife, Marie Saxe; (ii) 62,788 shares
owned by a trust u/w Leonard S. Saxe for which Mr. Saxe
serves as a co-trustee, and has a beneficial interest in one-half
of the income from such trust; and (iii) 11,250 shares of
Common Stock owned by a trust for the children of the late
George Backer and certain others for which Mr. Saxe serves
as sole trustee. Mr. Saxe disclaims beneficial ownership to all
securities described in item (iii) above.
(3) Includes 97,560 shares of Common Stock owned by Mr.
Harary's children, as to which shares Mr. Harary disclaims
beneficial ownership.
(4) Includes 898 shares of Common Stock owned by Mr.
LaPointe's wife, as to which shares Mr. LaPointe disclaims
beneficial ownership.
(5) Includes the securities described above in footnotes (2)
through (4).
ELECTION OF DIRECTORS
(Item 1)
The number of Directors is currently set at six, pursuant to the
By-Laws of the Company. A majority of the Board of Directors of
the Company are independent directors. The Board of Directors is
divided into three classes, as nearly equal in number as possible.
Each class serves three years, with the terms of office of the
respective classes expiring in successive years. The term of office
of the directors nominated for re-election expires at the 2009
Annual Meeting of Stockholders. The Board of Directors proposes
that Joseph M. Harary and Richard Hermon-Taylor be elected to
Class I and hold office for a three-year term expiring at the 2012
Annual Meeting of Stockholders, and until the election and
qualification of their respective successors, and M. Philip Guthrie
be elected to Class II to hold office until the 2010 Annual Meeting
of Stockholders, and until the election and qualification of his
respective successor. If no other choice is specified in the
accompanying proxy, the persons named therein have advised
management that it is their present intention to vote the proxy for
the election of the nominees set forth below. Each of the members
of the Board of Directors of the Company, including the nominees
listed below, is presently a director of the Company, and was
elected to such office by the stockholders of the Company, except
for Mr. Guthrie and Mr. Hermon-Taylor who were appointed to
the Board of Directors in December 2007 after the board was
expanded. Should a nominee become unable to accept nomination
or election, it is intended that the persons named in the
accompanying proxy will vote for the election of such other person
as management may recommend in the place of such nominee.
There is no indication at present that any nominee will be unable
to accept nomination.
The following biographical information is provided with
respect to each director:
Directors Standing for Election
Joseph M. Harary
Mr. Harary, age 48, became Vice President and General Counsel
to the Company in April 1992 and has been a director of the
Company since February 1993. In December 1999, Mr. Harary
was promoted to the position of Executive Vice President and
General Counsel, and in February 2002 was promoted to the
position of President and Chief Operating Officer of the Company.
Mr. Harary was promoted to the position of Chief Executive
Officer of the Company in January 2009. Mr. Harary has also been
the Treasurer and Chief Financial Officer of the Company since
2005 and its corporate Secretary since 2007. Prior to joining
Research Frontiers, Mr. Harary's corporate law practice
emphasized technology, licensing, mergers and acquisitions,
securities law, and intellectual property law at three prestigious
New York City law firms. Mr. Harary graduated Summa Cum
Laude from Columbia College in 1983 with an A.B. degree in
economics, and received a Juris Doctor degree from Columbia
Law School in 1986 where he was a Harlan Fiske Stone Scholar.
Prior to attending law school, Mr. Harary was an economist with
the Federal Reserve Bank of New York.
Richard Hermon-Taylor
Richard Hermon-Taylor, age 67, has been a director of the
Company since December 2007. Mr. Hermon-Taylor serves as
Chairman of the Company's Nominating and Corporate
Governance Committee, and also serves on the Company's Audit
and Compensation Committees. His prior Board of Director
experience includes Harley-Davidson, a $5 billion manufacturer
of motorcycles, clothes, and the licensor of the Harley-Davidson
trademark. During his over 15-year tenure on the Harley-Davidson
Board, he served on its Audit, Compensation, and Nominating
Committees. He also served on the Board of Galileo
Electro-Optics, a public company that was acquired by Corning,
Inc. From 1970-1986 he was with the Boston Consulting Group
and managed the firm's offices in Boston and Milan. Mr.
Hermon-Taylor received a B.A. in Chemical Engineering from
Cambridge University in England and an MBA from the Harvard
University Graduate School of Business, where he was a Baker
Scholar. He is currently President and Co-Founder of Bio-Science
International, Inc. This company specializes in technology
development and licensing agreements for the life sciences
industry.
M. Philip Guthrie
M. Philip Guthrie, age 64, has been a director of the Company
since December 2007. Mr. Guthrie serves as Chairman of the
Company's Audit Committee, and also serves on the Company's
Compensation and Nominating and Corporate Governance
Committees. Mr. Guthrie was Chief Financial Officer of two
public companies in the airline industry - Southwest Airlines
during its formative and high-growth years, and Braniff
International during its initial restructure and successful
reorganization. His other aerospace experience includes CEO of
InTech Aerospace Group, which provided a full range of interior
service and maintenance to the commercial airline industry and to
the US Government. He was Managing Director of Mason Best
Company and served in board and management roles in many of
its, and other private equity firms', portfolio companies. He has
also served as Chairman of the Board for Westmark/Tracor, a
maker of military electronic systems. He currently serves on the
Boards of Ariel Reinsurance (Bermuda) and is also a member of
its Audit Committee, Direct General Corporation where he is also
Chairman of its Audit Committee, Bristol Group (Argentina), and
Neuro Resource Group, Inc. He is CEO of Neuro Holdings
International, an international distributor of leading-edge medical
devices for pain management. Mr. Guthrie has a CPA and began
his career at Price Waterhouse. He has an MBA from the
University of Michigan where he was a Paton Scholar and a BBA
Summa Cum Laude in accounting from Louisiana Tech University.
He is CEO of Denham Partners, LLC, a private investment firm.
Directors Continuing in Office
Class II - Term Expires at the 2010 Annual Meeting of Stockholders
Victor F. Keen
Victor F. Keen, age 68, has been a director of the Company since
June 2001, and served as the Company's corporate Secretary from
1987 to 2007. Mr. Keen is Of Counsel to the law firm of Duane
Morris LLP, one of the 100 largest law firms in the world with
more than 650 lawyers. He has served prior thereto as a partner
and chairman of Duane Morris' tax department. Mr. Keen is a
graduate of Trinity College (1963) and Harvard Law School
(1966). Mr. Keen serves as Chairman of the Company's
Compensation Committee, and also serves on the Company's
Audit, and Nominating and Corporate Governance Committees.
Mr. Keen is also a member of the board of directors of 3DIcon
Corporation, a development-stage technology company developing
3-D projection and display technologies. Mr. Keen serves on
3DIcon's Audit Committee, Nominating/Corporate Governance
Committee and Compensation Committee and is Chairman of its
Compensation Committee. Mr. Keen is also a Managing Member
of Chelsea/Village Associates, LLC and Ninth Avenue Associates,
LLC, both of which own and manage real estate in Manhattan.
Class III - Term Expires at the 2011 Annual Meeting of Stockholders
Robert L. Saxe
Mr. Saxe, age 73, is a founder of the Company and has been
Chairman of the Board of Directors of the Company since its
inception in 1965, was its President from 1966 to February 2002,
and Treasurer from 1966 to 2005. Mr. Saxe is the Company's
Chief Technology Officer and served as the Company's Chief
Executive Officer from 1965 to 2008. He graduated from Harvard
College in 1956 with an A.B. degree, Cum Laude in General
Studies (with a major in physics). Mr. Saxe also received an
M.B.A. degree from Harvard Business School in 1960.
Robert M. Budin
Mr. Budin, age 76, has been a director of the Company since 1987.
Mr. Budin was a Senior Vice President of Harold C. Brown & Co.,
Inc. until his retirement in 1990. Mr. Budin was a stockbroker and
had been employed at Harold C. Brown & Co., Inc. since 1963.
Mr. Budin serves on the Company's Nominating and Corporate
Governance, Compensation, and Audit Committees.
Board Composition, Committees and Meetings
The Board of Directors has an active Audit Committee, a
Compensation Committee, and a Nominating and Corporate
Governance Committee. The members of each of these three latter
committees, Robert M. Budin, M. Philip Guthrie, Richard
Hermon-Taylor, and Victor F. Keen, consist solely of the
Company's four non-management directors, each of whom the
Board has determined meets the independence requirements under
the applicable listing standards of the NASDAQ Capital Market
governing the independence of directors. During fiscal 2000, the
Audit Committee of the Board of Directors developed a written
charter for the Committee that was approved by the Board of
Directors which was updated in 2004, and was updated again in
February 2009. The complete text of the Audit Committee's
current charter is available on Company's website at
www.SmartGlass.com and is also attached as an Exhibit to this
Proxy Statement. The Compensation Committee and the
Nominating and Corporate Governance Committee are not
required to, and do not have, written charters.
The Audit Committee reviews and reports to the Board of
Directors with respect to various auditing and accounting matters,
including the nomination of the Company's independent registered
public accountants, the scope of audit procedures, general
accounting policy matters, and the performance of the Company's
independent registered public accountants.
The Compensation Committee reviews and reports to the
Board of Directors its recommendations for compensation of all
employees and sets the compensation of the management of the
Company.
The Nominating and Corporate Governance Committee is
responsible for overseeing the governance practices of the
Company and for making recommendations to the Board for any
modifications to such practices. It also identifies individuals
qualified to become Board members and recommends to the Board
the director nominees for the next annual meeting of stockholders
and candidates to fill vacancies on the Board. Additionally, the
committee recommends to the Board the directors to be appointed
to Board committees. Because the Board of Directors of the
Company has a majority of independent directors, these
independent directors control the Board of Directors' selection of
nominees for director.
The Nominating and Corporate Governance Committee
considers candidates for Board membership suggested by its
members and by other Board members. Additionally, in selecting
nominees for directors, the Nominating and Corporate Governance
Committee will review candidates recommended by stockholders
in the same manner and using the same general criteria as
candidates recruited by the committee and/or recommended by the
Board. The Nominating and Corporate Governance Committee
will also consider whether any person nominated by a shareholder
has been so nominated on a timely basis and in accordance with
the provisions of the Company's by-laws relating to shareholder
nominations and other applicable provisions including those
described in "2010 Stockholder Proposals and Director
Nominations" below.
Once the Nominating and Corporate Governance Committee
has identified a prospective nominee, it or a subcommittee of the
Nominating and Corporate Governance Committee makes an
initial determination as to whether to conduct a full evaluation of
the candidate. This initial determination is based on the
information provided to the subcommittee with the
recommendation of the prospective candidate, as well as the
subcommittee's own knowledge of the prospective candidate,
which may be supplemented by inquiries of the person making the
recommendation or others. The preliminary determination is based
primarily on the need for additional Board members to fill
vacancies or expand the size of the Board and the likelihood that
the prospective nominee can satisfy the evaluation factors
described below. Based on the recommendation of the
subcommittee, the full committee then evaluates the prospective
nominee and his or her qualifications, as well as other factors
which may include such things as whether the prospective
nominee meets the independence requirements and other
qualifications or criteria set forth under applicable listing standards
of the NASDAQ Capital Market, or other requirements defined
under applicable Securities and Exchange Commission rules and
regulations; the extent to which the prospective nominee's skills,
experience and perspective add to the range of talent appropriate
for the Board and whether such attributes are relevant to the
Company's industry; the prospective nominee's ability to dedicate
the time and resources sufficient for the diligent performance of
Board duties; and the extent to which the prospective nominee
holds any position that would conflict with responsibilities to the
Company.
If the Nominating and Corporate Governance Committee's
internal evaluation is positive, the subcommittee and possibly
others will interview the candidate. Upon completion of this
evaluation and interview process, the Nominating and Corporate
Governance Committee makes a recommendation and report to the
full Board as to whether the candidate should be nominated by the
Board and the Board determines whether to approve the nominee
after considering this recommendation and report.
During 2008, the Company's Board of Directors had ten
formal meetings and also met numerous additional times
informally, the Board's Audit Committee met four times, and the
Board's Compensation Committee met eight times. The
Company's Nominating and Corporate Governance Committee
met six times in 2008. No incumbent director attended less than
75% of meetings of the Board of Directors during 2008. The
Company encourages and expects all of its directors to attend its
Annual Meeting of Stockholders, and all of the Company's
directors attended last year's Annual Meeting of Stockholders.
Executive Officers
In addition to Robert L. Saxe and Joseph M. Harary, whose
biographical information is provided above, the only other
executive officers of the Company are Michael R. LaPointe and
Steven M. Slovak. Michael R. LaPointe, age 50, who is the
Company's Vice President - Marketing since March 2002, joined
the Company as its Director of Marketing for Architectural
Windows and Displays in March 2000. Mr. LaPointe, a graduate
of Brown University with a B.A. in Organizational Behavior &
Management and a B.A. in Psychology, worked in a marketing
capacity for IBM Corporation in the early 1980s. He subsequently
founded and developed several companies involved in the
application and licensing of new technologies for various
consumer products. During that period Mr. LaPointe also worked
as a management consultant, where in 1994 he began his
relationship with Research Frontiers, assisting the Company with
its marketing strategy. Steven M. Slovak, age 47, joined Research
Frontiers in January 1989 as a chemist and was promoted to
various positions. In November 2005 Mr. Slovak became Research
Frontiers' Director of Film Development, and in January 2008 was
promoted to his current position as Vice President-Technology
where he oversees a growing team of chemists. Steve Slovak is an
inventor on numerous patents and patent applications held by
Research Frontiers worldwide on SPD-Smart light-control
technology, and is a member of various scientific organizations
including the ASTM International and the National Fenestration
Ratings Council (NFRC).
The Board of Directors recommends a vote FOR election
of the three nominees listed above and it is intended that
proxies not marked to the contrary will be so voted.
INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
(Item 2)
The Audit Committee, with the concurrence of the Board of
Directors, has selected the firm of BDO Seidman, LLP to serve as
our independent registered public accountants for the fiscal year
ending December 31, 2009. BDO Seidman, LLP has been the
Company's independent registered public accountants since 2005,
and is considered by management to be well-qualified to serve as
the Company's independent registered public accountants. We
expect that representatives of BDO Seidman, LLP will attend the
meeting, have the opportunity to make a statement if they so
desire, and be available to respond to appropriate questions.
Audit and Other Fees
The following table presents fees paid or accrued for professional
audit services rendered by BDO Seidman, LLP for the audit of our
annual financial statements for the years ended December 31, 2008
and 2007, and fees billed to us for other services rendered by BDO
Seidman, LLP during that period:
2008 2007
Audit Fees (1) $154,000 $149,500
Audit-Related Fees 0 0
Tax Fees (2) 14,500 14,500
All Other Fees 0 0
Total $168,500 $164,000
(1) Audit fees includes the audit of Research Frontiers
Incorporated annual financial statements and its internal
controls over financial reporting, review of financial
statements included in Research Frontiers Incorporated's
Form 10-Q Quarterly Reports, and services that are normally
provided by the independent registered public accountants in
connection with regulatory filings for those fiscal years.
(2) Tax fees include fees for all services performed by the
independent registered public accountants' tax personnel
except those services specifically related to the audit of the
financial statements, and includes fees for tax compliance and
tax advice.
The Audit Committee has approved the above-listed fees, has
considered whether the provision of the non-audit services
described above is compatible with maintaining such accounting
firms' independence, and has determined that the provision of such
services is compatible with maintaining such accounting firms'
independence.
The Board of Directors recommends a vote FOR ratification
of the selection of the accounting firm of BDO Seidman, LLP
as independent registered public accountants of the Company
for the fiscal year ending December 31, 2009.
Audit Committee Report
The following Audit Committee Report does not constitute
soliciting material and should not be deemed filed or incorporated
by reference into any other Company filing under the Securities
Act of 1933 or the Securities Exchange Act of 1934, except to the
extent the Company specifically incorporates this Report by
reference therein.
During fiscal 2000, the Audit Committee of the Board of
Directors developed a written charter for the Committee that was
approved by the Board of Directors and which was updated in
2004 and was updated again in February 2009. The complete text
of the Audit Committee's current charter is available on
Company's website at www.SmartGlass.com and is also attached
as an Exhibit to this Proxy Statement.
The Audit Committee of the Board is responsible for
providing independent, objective oversight of the Company's
accounting functions and internal controls. The Audit Committee
is comprised of the independent directors of the Company: M.
Philip Guthrie, who serves as the Audit Committee's Chairman
and also is the Audit Committee's "financial expert" (as such term
is defined by applicable rules), Robert M. Budin, Richard Hermon-
Taylor and Victor F. Keen. The Company believes that all of the
members of its Audit Committee, due to their backgrounds and
business experience, have a sufficient understanding of generally
accepted accounting principles and financial statements, the ability
to assess the general application of such principles, an
understanding of internal controls over financial reporting, and of
audit committee functions to perform their duties as an Audit
Committee. Part of the Audit Committee's duties specifically
include the appointment, compensation and supervision of the
Company's independent registered public accountants, as well as
pre-approval of all auditing and non-auditing services provided by
the Company's independent registered public accounting firm.
Management is responsible for the Company's internal controls
and financial reporting process. The independent registered public
accountants are responsible for performing an independent audit
of the Company's financial statements and its internal controls
over financial reporting, in accordance with auditing standards of
the Public Company Accounting Oversight Board, and to issue a
report thereon. As set forth in more detail in its charter, the Audit
Committee's responsibility is to monitor and oversee these
processes.
In connection with these responsibilities, the Audit
Committee met with management and the Company's independent
registered public accountants, to review and discuss all financial
statements included in the Company's quarterly and annual reports
for the fiscal year ended December 31, 2008 (the "Financial
Statements") prior to their issuance and to discuss significant
accounting issues. Management has advised us that the Financial
Statements were prepared in accordance with generally accepted
accounting principles, and the Committee discussed the Financial
Statements with both management and the independent registered
public accountants. Our review included discussions with the
independent registered public accountants of matters required to
be discussed by the Statement on Auditing Standards No. 61 as
amended (Communication with Audit Committees).
The Audit Committee also received written disclosures from
the independent registered public accountants required by
Independence Standards of the Public Company Accounting
Oversight Board, and the Audit Committee discussed with the
independent registered public accountants that firm's
independence.
Finally, the Audit Committee continued to monitor the
integrity of the Company's financial reporting processes and its
internal procedures and controls.
Based upon the Audit Committee's discussions with
management and the independent registered public accountants,
and the Audit Committee's review of the representations of
management and the independent registered public accountants,
the Audit Committee recommended to the Board of Directors that
the Company's audited financial statements be included in the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2008, for filing with the Securities and Exchange
Commission.
Members of the Audit Committee
M. Philip Guthrie (Chairman)
Robert M. Budin
Richard Hermon-Taylor
Victor F. Keen
EXECUTIVE COMPENSATION
The following table sets forth information regarding all cash
compensation paid by the Company and stock options granted
during the fiscal years indicated to Robert L. Saxe, the Company's
chief executive officer through December 31, 2008, Joseph M.
Harary, the Company's current Chief Executive Officer, and to
each of the Company's executive officers during the past fiscal
year.
Name of Executive and Option All Other
Principal Positions Year Salary Bonus Awards($)(1) Compensation(2) Total(3)
Robert L. Saxe, 2008 $409,865 $ 0 $ 0 $ 24,747 $ 434,612
Director, Chairman 2007 $393,091 $ 0 $903,582 $ 10,583 $1,307,256
of the Board 2006 $379,798 $ 0 $ 0 $ 24,833 $ 404,631
Joseph M. Harary, 2008 $409,865 $ 0 $ 0 $55,680 $ 465,545
Director, President, 2007 $393,091 $139,760 $708,556 $37,797 $1,279,204
General Counsel, 2006 $379,798 $ 54,000 $ 0 $43,823 $ 477,621
Teasurer,Secretary
Michael R. LaPointe, 2008 $146,203 $ 0 $ 0 $ 2,759 $ 148,962
Vice President- 2007 $140,219 $ 0 $210,747 $ 0 $ 350,966
Marketing 2006 $135,477 $ 0 $ 0 $ 4,168 $ 139,646
Steven M. Slovak 2008 $146,203 $ 0 $ 0 $ 5,517 $ 151,720
Vice President- 2007 $113,076 $ 0 $280,134 $ 4,349 $ 397,559
Technology 2006 $109,252 $ 0 $ 0 $ 6,723 $ 115,975
-----------------------------------------------------------------------
(1) The dollar value of option awards listed below are estimated
values based upon the Black-Scholes valuation method in
accordance with FAS 123(R) using the assumptions set forth in
the Company's Annual Report on Form 10-K for the respective
year in question.
(2) Consists of the payment of accrued but unused vacation.
(3) Consists of cash compensation (salary, bonus, and accrued
vacation) plus the estimated dollar value of option awards
based upon the Black-Scholes valuation method described in
footnote (1) above. These amounts do not indicate the amount
actually realized by the individual since estimated values will
fluctuate based upon future market conditions.
The Company has no plan providing for pension benefits, non-
qualified defined contributions, deferred contributions, or payments
upon a change of control of the Company.
Stock Options Granted in 2008
No stock options were granted to any officer or director of the
Company during 2008 so the table setting forth information
regarding all grants of options to the executive officers of the
Company during 2008, and their estimated fair value on the date of
grant recognized for financial statement reporting purposes is
omitted.
The following table shows all options outstanding as of the end of
2008 granted to executives of the Company. All options listed are
fully vested and exercisable at year end.
Outstanding Equity Awards at December 31, 2008
Number of
Securities
Underlying
Unexercised Option Option Option
Stock Options Exercise Grant Expiration
Name of Executive (# Exercisable) Price Date Date
Robert L. Saxe: 240,000 $ 8.37500 06/10/99 06/09/09
61,981 $14.93000 07/12/07 07/11/10
48,000 $14.46875 10/12/00 10/11/10
48,000 $19.00000 12/15/00 12/14/10
120,000 $25.52500 06/14/01 06/13/11
60,000 $ 9.94000 09/24/01 09/23/11
60,000 $12.77500 06/13/02 06/12/12
27,733 $ 6.00000 07/01/05 06/30/15
88,560 $11.20000 12/06/05 12/05/15
20,000 $11.37500 02/13/07 02/12/17
64,756 $ 9.80000 12/03/07 12/02/17
Joseph M. Harary: 60,000 $ 8.37500 06/10/99 06/09/09
50,000 $14.93000 07/12/07 07/11/10
28,000 $14.46875 10/12/00 10/11/10
28,000 $19.00000 12/15/00 12/14/10
60,000 $25.52500 06/14/01 06/13/11
30,000 $ 9.94000 09/24/01 09/23/11
35,000 $12.77500 06/13/02 06/12/12
40,000 $11.20000 12/06/05 12/05/15
15,000 $11.37500 02/13/07 02/12/17
50,000 $ 9.80000 12/03/07 12/02/17
Michael R. LaPointe: 50,000 $37.03125 02/22/00 02/21/10
1,500 $18.90625 06/08/00 05/22/10
1,500 $14.46875 10/12/00 10/11/10
1,500 $19.00000 12/15/00 12/14/10
15,000 $25.52500 06/14/01 06/13/11
7,000 $12.77500 06/13/02 06/12/12
7,000 $12.81000 06/12/03 06/11/13
10,000 $ 6.17500 12/14/04 12/13/14
11,000 $ 6.00000 07/01/05 06/30/15
10,000 $ 5.60000 12/06/05 12/05/15
10,000 $11.37500 02/13/07 02/12/17
10,000 $14.93000 07/12/07 07/11/17
10,000 $ 9.80000 12/03/07 12/02/17
Steven M. Slovak: 4,000 $ 8.37500 06/10/99 06/09/09
2,000 $ 14.46875 10/12/00 10/11/10
2,000 $ 19.00000 12/15/00 12/14/10
4,000 $ 25.52500 06/14/01 06/13/11
5,000 $ 9.94000 09/24/01 09/23/11
5,000 $ 12.77500 06/13/02 06/12/12
6,000 $ 12.81000 06/12/03 06/11/13
7,500 $ 6.17500 12/14/04 12/13/14
10,000 $ 5.60000 12/06/05 12/05/15
10,000 $ 11.37500 02/13/07 02/12/17
15,000 $ 14.93000 07/12/07 07/11/17
15,000 $ 9.80000 12/03/07 12/02/17
Stock Options Exercised in 2008
No stock options were exercised by any officer or director of
the Company during 2008 so the table setting forth information
regarding all exercises of options by executive officers of the
Company during 2008, and the dollar amount realized is omitted.
Director Compensation
Historically, the Company has paid its directors fees in the form
of stock options and not in cash or other compensation. In December
2007 each independent outside director received 25,000 stock options
in payment for 2008 directors fees. Independent outside directors of
the Company each received in January 2009 their directors fees for
2009 in a combination of 25,000 shares of common stock of the
Company and a cash fee of $35,000. The Company's policies towards
compensation of directors are described below in "Compensation
Discussion and Analysis."
Compensation Discussion and Analysis
The compensation of executive officers of the Company,
including the Company's chairman and its chief executive officer, is
determined by the Compensation Committee of the Company's Board
of Directors, whose names are listed below at the end of their report.
The starting point for determining compensation of any executive
officer is their historical base salary and prior compensation history.
The salaries of all executive officers are also reviewed at least
annually by the Compensation Committee and by the entire Board of
Directors. Numerous factors are reviewed in determining
compensation levels. These factors include: the compensation levels
of executive officers with comparable experience and qualifications,
compensation levels at comparable companies, individual and
Company performance, past compensation levels, performance of the
Company's stock, and other relevant considerations, including a
review of applicable compensation studies and other reference
materials. The Company's Compensation Committee also reviews and
approves recommendations made by management of the Company
with respect to the compensation of all non-executive employees of
the Company.
In determining compensation levels for the Company's
chairman, chief executive officer and independent directors for 2009
(the "Covered Individuals"), the Compensation Committee engaged
a nationally recognized independent compensation consulting firm (i)
to evaluate the past and current compensation of those individuals (ii)
to aid the Compensation Committee in developing a relevant peer
group of companies against which to measure the reasonableness and
appropriateness of compensation of those individuals and (iii) to
provide guidance to the Compensation Committee in determining the
level of 2009 compensation and the mix as among cash, and long and
short-term incentive compensation.
Taking all of the factors the Compensation Committee regards
as relevant, including the compensation levels reflected in the peer
group of companies considered by the Compensation Committee to
be applicable to the Company, and the finding and recommendations
contained in report of the Compensation Committee's independent
compensation consultant, the Compensation Committee, having met
and deliberated eight times during 2008, believes that the current
compensation approach and level of compensation of the Covered
Individuals is appropriate and in the best interests of the Company
and its shareholders. The levels and characteristics of the 2008 and
2009 compensation of the Covered Individuals are described
elsewhere in this Proxy Statement.
The Company's goal is to set compensation levels based upon
the approach discussed above, and to include in such compensation
a relevant combination of base salary, equity incentives, and
performance-based bonuses. This approach is designed to align total
executive compensation with the long-term performance of the
Company and enable all employees of the Company to participate in
the Company's growth. Through ownership of stock and options, the
executive is rewarded if the Company's stockholders receive the
benefit of appreciation of the price of the Company's Common Stock.
The grant of equity awards is designed to attract, retain and
provide incentives to those responsible for its success, and to reduce
the amount of cash compensation that would otherwise be necessary
to achieve such goals. In 2008, the shareholders of the Company
approved the Company's 2008 Equity Incentive Plan (the "2008
Plan") which provides for the issuance of up to 750,000 shares of
common stock pursuant to awards granted under the plan. The Board
of Directors believes that the 2008 Plan is essential to the Company's
continued success. The purpose of the 2008 Plan is to afford an
incentive to executive officers, other employees, non-employee
directors and consultants of the Company to acquire a proprietary
interest in the Company, to continue as employees, non-employee
directors or consultants (as the case may be), to increase their efforts
on behalf of the Company and to promote the success of the
Company's business. To further such purposes, stock options, stock
appreciation rights, restricted stock and restricted stock units may be
granted pursuant to the 2008 Plan. The Board of Directors believes
that the granting of awards under the 2008 Plan will promote
continuity of management, help attract new employees, and
encourage employees, directors, officers and consultants, to increase
their stock ownership in the Company and provide an increased
incentive and personal interest in the welfare of the Company by
those who are or may become primarily responsible for shaping and
carrying out the long range plans of the Company and securing its
continued growth, development and financial success. The number of
stock and options granted under such plan is determined based upon
factors similar to those described above in connection with the setting
of cash compensation.
The Company's 2008 Plan is administered by a committee of at
least two directors who are not officers and employees of the
Company (the "Administrators"). Currently the Administrators consist
of all four independent directors of the Company , who serve as
members of the Company's Stock Option Committee and are also the
sole members of the Company's Compensation Committee. Options
which qualify as Incentive Stock Options ("ISOs") under the Internal
Revenue Code of 1986, as amended (the "Code"), and non-qualifying
options ("NQSOs") may be issued under the Company's 2008 Equity
Incentive Plan. Also stock appreciation rights and restricted stock may
be awarded under the Company's 2008 Equity Incentive Plan. The
number of options to be granted under these stock option plans is
determined by the Administrators in their discretion.
In the case of stock options issued under the 2008 Plan, the
purchase price of Common Stock subject to each option issued will
be determined by the Board of Directors or the Administrators, as the
case may be, but in the case of an ISO may not be less than (i) the fair
market value of the Common Stock subject to the option on the date
of grant or (ii) in the case of an option granted to an employee who,
at the time the option is granted, owns (within the meaning of the
Code) more than 10% of the total combined voting power of all
classes of stock of the Company, 110% of the fair market value of the
Common Stock subject to the option on the date of grant. Options
under the 2008 Plan may be exercised in the manner and at such times
fixed by the Board of Directors, but may not be exercised for a term
of more than 10 years, or for a term of five years in the case of an
employee who, at the time an ISO is granted, owns (within the
meaning of the Code) more than 10% of the total combined voting
power of all classes of stock of the Company. In no event may ISOs
exercisable for stock having an aggregate fair market value
determined on the date of grant of $100,000 (together with all ISOs
granted under any other stock option) be granted which first become
exercisable in any one calendar year. Options are not transferable
except by will or intestacy on the death of the optionee. In general,
ISOs terminate when an optionee ceases to be employed by the
Company or within a specified period after the termination of such
employment depending upon the reason for such termination. It is
currently expected that option grants will be reviewed twice per year.
During 2006, no stock options were granted. Stock options were
awarded to all employees and directors of the Company in February
2007 after certain key milestones were achieved and publicly
announced relating to production of SPD light-control film and
customer adoption of SPD technology in certain end-products. These
option grants were supplemented in July 2007. In December 2007,
prior to the expiration of its 1998 Stock Option Plan, the Company
also granted options to its directors and employees to provide a future
incentive and also to pay existing and new directors their directors
fees. In total during 2007, 654,537 options having a weighted average
exercise price of $11.85 were granted to directors, employees of, and
consultants to, the Company. No options were granted in 2008. As
noted in the last year's Compensation Discussion and Analysis, the
Board of Directors anticipated that it may grant awards other than
options under the 2008 Plan because the granting stock appreciation
rights, restricted stock and/or restricted stock units in lieu of options
should result in a lower burn rate (the number of shares subject to
awards annually) and a lower level of dilution. In January 2009,
299,950 shares of restricted stock were granted to directors,
employees, and a consultant to the Company, and awards for up to
450,050 shares of common stock remain available for future issuance
under the 2008 Plan. In the case of all such grants of restricted stock
to executive officers of the Company, these awards vest monthly over
a three year period after grant.
All employees employed by the Company at the beginning of
2007 and 2008 received a cost-of-living increase in their base salaries
and Steven M. Slovak and certain other members of his technical staff
received supplemental increases based upon meritorious performance,
increased duties, and achievement of other research-related goals. In
addition, the President of the Company received bonus compensation
during 2007 for the achievement of certain milestones set by the
Company's Board of Directors regarding the raising of additional
capital to strengthen the financial position of the Company.
Since the Company's four independent directors each chair (or
recently chaired) one of three committees (Audit, Compensation, or
Nominating and Corporate Governance Committees), and serve as
members of the other such committees that they do not so chair, the
Company believes that it is appropriate to set target levels of director
compensation based upon the factors described above for service on
the Company's Board of Directors. Based in part upon its review of
comparable directors fees paid at the peer group of companies
identified by the Compensation Committee, and upon the analysis and
recommendations of the independent compensation consulting firm
noted above, each non-employee independent director received stock
options with respect to service as a Director during 2008 having a
Black-Scholes valuation initially targeted at approximately $80,000,
which targeted amount is then subject to adjustment based upon
results achieved and future modification as a result of prevailing
compensation levels and other factors. A similar compensation target
for directors was set for Board service during 2009, which was paid
in January 2009 in a combination of 25,000 shares of common stock
and $35,000 in cash to each of the Company's four independent
directors. The mix of cash and stock for 2009 and future years was
developed following the review of the independent compensation
consulting firm's report and an evaluation of prevailing trends and
best practices in corporate governance and director compensation in
a broad range of public companies.
Employment Arrangements
The Company entered into an employment agreement effective
January 1, 1989 with Mr. Robert L. Saxe which automatically renews
itself for successive one-year terms unless either the Company or Mr.
Saxe gives the other at least 10 days prior written notice of the
intention not to renew the employment agreement. Pursuant to that
agreement, Mr. Saxe received an annual base salary from the
Company of $402,132 during 2008 and will receive an annual base
salary of $402,132 through December 31, 2009. Pursuant to his
employment agreement, Mr. Saxe has agreed not to compete with the
Company for a period of two years following the termination of his
employment thereunder.
In 2009, the Company entered into a five-year employment
agreement with Joseph M. Harary, which was effective as of January
1, 2009 when Mr. Harary was promoted to the position of Chief
Executive Officer of the Company. The agreement automatically
renews itself for successive one-year terms unless either the Company
or Mr. Harary gives the other at least 90 days prior written notice of
the intention not to renew the employment agreement. Pursuant to that
agreement, in addition to possible future equity incentive awards
granted by the Board of Directors of the Company in their discretion,
Mr. Harary received 150,000 shares of restricted stock of the
Company which vest monthly over a three-year period, and Mr.
Harary will receive an annual base salary from the Company of
$425,000, and will be eligible to also earn a bonus based upon the
achievement of performance goals established by the Board of
Directors for Mr. Harary. Current performance goals for 2009 for Mr.
Harary include achievement of targeted revenue levels, strengthening
the Company's financial condition, achievement of certain enhanced
performance goals for the Company's light-control technology, and
the establishment of strategic goals for the entire Company and their
efficient implementation and management. Pursuant to his
employment agreement, if Mr. Harary's employment is terminated
due to his death or disability, Mr. Harary shall be entitled to receive
his base salary (less any disability payments) for six months as well
as any earned or accrued bonus. If Mr. Harary's employment is not
renewed, or is terminated by the Company other than due to death,
disability, or for cause (as defined in the agreement) prior to its
scheduled expiration date, then Mr. Harary shall also receive his base
salary for between one and three years, depending upon the date of
such termination. If there is a change in control of the Company, Mr.
Harary shall receive his base salary for the longer of three years or the
scheduled date of termination of Mr. Harary's employment
agreement. Unless vesting is otherwise accelerated under the terms of
an equity award (which is usually done in the case of death or
disability of an employee), if Mr. Harary's employment is terminated
by the Company in breach of his employment agreement or is
terminated by Mr. Harary other than for good reason (as defined in
the agreement), any unvested equity awards shall also become
immediately vested. Pursuant to the employment agreement, Mr.
Harary is also entitled to four weeks paid vacation each year, and
other fringe benefits generally applicable to other employees of the
Company. Under his employment agreement, Mr. Harary has also
agreed to certain restrictive covenants including Mr. Harary's
agreement not to solicit employees or compete with the Company for
a period of two years following the termination of his employment
thereunder.
Compensation Committee Interlocks and Insider Participation
In 2008, the Compensation Committee of our Board of Directors
consisted solely of independent directors. None of the Company's
executive officers served as a director or member of the compensation
committee of another entity which had an executive officer that
served as a director or member of the Company's Compensation
Committee. No member of the Company's Compensation Committee
is a current or former employee of the Company.
Compensation Committee Report
The following Compensation Committee Report does not
constitute soliciting material and should not be deemed filed or
incorporated by reference into any other Company filing under the
Securities Act of 1933 or the Securities Exchange Act of 1934, except
to the extent the Company specifically incorporates this Report by
reference therein.
The Compensation Committee of the Board of Directors of
Research Frontiers Incorporated has reviewed and discussed with
management the Compensation Discussion and Analysis included in
this Proxy Statement. Based on its reviews and discussions, the
Committee recommended to the Board of Directors that the
Compensation Discussion and Analysis be included in this Proxy
Statement and incorporated by reference into the Company's Annual
Report on Form 10-K for the year ended December 31, 2008.
This report is submitted on behalf of the Compensation
Committee.
Members of the Compensation Committee
Victor F. Keen (Chairman)
Robert M. Budin
M. Philip Guthrie
Richard Hermon-Taylor
Equity Compensation Plan Information
The following table sets forth information as of December 31,
2008 with respect to shares of the Company's Common Stock that
may be issued under the Company's existing Stock Option Plan, and
any other equity that may be issued to officers or directors of, or
consultants to, the Company.
Number of Weighted Number of
Securities to Average Securities
be Issued Upon Exercise Price Remaining
Exercise of of Outstading Available
Outstanding Options Options and for Future
Plan Category and Warrants Warrants Issuance
Equity compensation plans
approved by security holders 2,447,480 $12.92 750,000
Equity compensation plans not
approved by security holders (see
Note 7(b)(ii) to the
Company's 12-31-08
financial statements) 162,500 $ 7.75 0
Total 2,609,980 $12.60 750,000
Stock Price Performance
The following table sets forth the range of the high and low
selling prices (as provided by The Nasdaq Stock Market, Inc.) of the
Company's common stock for each quarterly period within the past
two fiscal years:
Quarter Ended Low High
March 31, 2007 4.93 12.33
June 30, 2007 9.55 14.29
September 30, 2007 10.00 15.64
December 31, 2007 7.90 17.40
March 31, 2008 4.75 10.32
June 30, 2008 4.76 7.99
September 30, 2008 3.90 6.21
December 31, 2008 1.55 4.48
These quotations may reflect inter-dealer prices,
without retail mark-up, mark-down, or
commission, and may not necessarily represent
actual transactions.
The following graph compares the total returns (assuming
reinvestment of dividends) on $100 invested on December 31, 2003
in the Company's Common Stock (REFR), the NASDAQ Composite
(U.S.) Stock Index, and the NASDAQ Electronic Component Stock
Index. The stock price performance shown on the graph below
reflects historical data provided by The Nasdaq Stock Market, Inc.
and is not necessarily indicative of future price performance.
[graph with the following data points]
Date Index Index Index
U.S. NASDAQ Electronics REFR
12/31/03 $100.00 $100.00 $100.00
01/30/04 $102.97 $102.32 $136.49
02/27/04 $101.03 $96.91 $128.85
03/31/04 $99.31 $92.52 $103.55
04/30/04 $96.01 $83.67 $112.27
05/28/04 $99.21 $91.54 $96.88
06/30/04 $102.26 $91.51 $76.53
07/30/04 $94.45 $79.51 $75.57
08/31/04 $92.14 $71.34 $64.16
09/30/04 $94.89 $70.12 $68.46
10/29/04 $98.74 $75.52 $77.93
11/30/04 $104.82 $76.66 $67.49
12/31/04 $108.84 $79.09 $68.68
01/31/05 $103.17 $73.68 $64.59
02/28/05 $102.59 $75.77 $55.33
03/31/05 $99.98 $74.01 $55.97
04/29/05 $96.35 $71.29 $48.98
05/31/05 $103.80 $80.48 $46.93
06/30/05 $103.38 $78.45 $34.12
07/29/05 $109.97 $82.00 $31.54
08/31/05 $108.23 $78.94 $30.89
09/30/05 $108.31 $78.15 $33.37
10/31/05 $106.92 $73.86 $50.81
11/30/05 $112.75 $80.95 $60.93
12/30/05 $111.16 $78.36 $55.65
01/31/06 $116.06 $81.71 $54.90
02/28/06 $114.91 $82.46 $44.99
03/31/06 $117.90 $84.08 $41.55
04/28/06 $116.97 $84.28 $58.67
05/31/06 $109.92 $75.99 $58.13
06/30/06 $109.92 $75.04 $55.76
07/31/06 $105.73 $69.24 $46.29
08/31/06 $110.41 $77.91 $45.21
09/29/06 $114.22 $79.96 $46.50
10/31/06 $119.81 $82.71 $62.22
11/30/06 $122.93 $87.98 $64.91
12/29/06 $122.11 $86.14 $58.99
01/31/07 $124.50 $85.40 $68.78
02/28/07 $121.95 $85.08 $100.54
03/30/07 $122.29 $82.35 $103.34
04/30/07 $127.60 $88.46 $116.90
05/31/07 $131.52 $89.61 $111.52
06/29/07 $131.03 $93.41 $151.88
07/31/07 $127.86 $94.60 $160.71
08/31/07 $130.40 $100.65 $126.05
09/28/07 $135.18 $103.65 $160.60
10/31/07 $142.49 $105.15 $159.96
11/30/07 $132.68 $95.99 $106.03
12/31/07 $132.42 $96.58 $107.64
01/31/08 $119.56 $80.87 $76.53
02/29/08 $113.18 $78.71 $81.27
03/31/08 $114.06 $80.26 $72.98
04/30/08 $120.60 $87.14 $63.62
05/30/08 $125.89 $91.86 $63.08
06/30/08 $114.58 $82.59 $67.92
07/31/08 $116.79 $80.29 $49.19
08/29/08 $119.26 $84.29 $55.44
09/30/08 $106.57 $71.64 $44.35
10/31/08 $88.24 $57.31 $41.23
11/28/08 $78.90 $50.18 $21.21
12/31/08 $63.80 $52.09 $23.36
2010 STOCKHOLDER PROPOSALS AND DIRECTOR NOMINATIONS
Any stockholder who intends to present a proposal for action,
including the nomination of a candidate for Director, at the
Company's 2010 Annual Meeting of Stockholders, must comply
with and meet the requirements of the Company's By-Laws and of
Rule 14a-8 of the Securities and Exchange Commission. Rule 14a-8
requires, among other things, that any proposal be received by the
Company at its principal executive office, 240 Crossways Park
Drive, Woodbury, New York 11797, Attention: Corporate Secretary,
by December 31, 2009. Section 2.12 of the Company's By-Laws (a
copy of which is available upon request) sets forth the procedures
that must be followed with respect to stockholder nominations,
which include a requirement that the person making the nomination
be a stockholder of record at the time of giving notice for such
stockholders meeting and who shall be entitled to vote for the
election of directors at the meeting, and that such nomination be
made pursuant to timely notice in proper written form to the
Secretary of the Company. To be in proper written form, such notice
shall set forth (a) as to each person whom the stockholder proposes
to nominate for election or re-election as a director, (i) the name,
age, business address and residence address of such person, (ii) the
principal occupation or employment of such person, (iii) the class
and number of shares of the Company which are owned beneficially
and of record by such person, (iv) any other information relating to
such person that is required to be disclosed in solicitations of proxies
for election of directors, or is otherwise required, in each case
pursuant to Regulation 14A promulgated under the Securities
Exchange Act of 1934, as amended (including, without limitation,
such person's written consent to being named in the proxy statement
as a nominee and to serving as a director if elected), and (v) any
other information that is or would be required to be disclosed in a
Schedule 13D promulgated under the Securities Exchange Act of
1934 regardless of whether such person would otherwise be required
to file a Schedule 13D, and (b) as to the stockholder giving the
notice (i) the name and address, as they appear on the Company's
books, as such stockholder, (ii) the class and number of shares of the
Company which are owned beneficially and of record by such
stockholder, and (iii) a description of all arrangements or
understandings between such stockholder and the person nominated
by such stockholder, and any interest by such stockholder in the
election of the person nominated by such stockholder, and any
relationship between such stockholder and the person so nominated.
In addition, a person providing notice under this Section shall
supplementally and promptly provide such other information as the
Company otherwise requests. At the request of the Board, any
person nominated by the Board for election as a director shall
furnish to the Secretary of the Company that information required to
be set forth in a stockholder's notice of nomination which pertains to
the nominee.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the securities laws of the United States, the Company's
directors, its executive officers, and any persons holding more than
ten percent of the Company's Common Stock are required to report
their initial ownership of the Company's Common Stock and any
subsequent changes in that ownership to the Securities and Exchange
Commission. Specific due dates for these reports have been
established, and the Company is required to disclose in this Proxy
Statement any failure to file by these dates. All of these filing
requirements were satisfied on a timely basis. In making these
disclosures, the Company has relied solely on written representations
of its directors and executive officers and copies of the reports that
they have filed with the Commission.
GENERAL AND OTHER MATTERS
Management knows of no matter other than the matters
described above which will be presented to the meeting. However,
if any other matters properly come before the meeting, or any of its
adjournments, the person or persons voting the proxies will vote
them in accordance with his, her or their best judgment on such
matters.
By Order of the Board of Directors
JOSEPH M. HARARY, Secretary
Woodbury, New York
April 30, 2009
THE COMPANY WILL PROVIDE WITHOUT CHARGE A
COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-
K FOR THE YEAR ENDED DECEMBER 31, 2008 INCLUDING
FINANCIAL STATEMENTS AND ANY SCHEDULES
THERETO (EXCEPT EXHIBITS), TO EACH OF THE
COMPANY'S STOCKHOLDERS, UPON RECEIPT OF A
WRITTEN REQUEST THEREFOR MAILED TO THE
COMPANY'S OFFICES, ATTENTION: SECRETARY.
REQUESTS FROM BENEFICIAL STOCKHOLDERS MUST SET
FORTH A REPRESENTATION AS TO SUCH OWNERSHIP ON
APRIL 17, 2009.
EXHIBIT A
RESEARCH FRONTIERS INC.
AUDIT COMMITTEE CHARTER
February 23, 2009
1. Purpose of the Audit Committee:
The committee is established by the Board of Directors of Research
Frontiers Inc (the "Board") to assist the Board in its oversight of the
integrity of the Company's financial statements and financial
reporting process, the Company's compliance with legal and
regulatory requirements and ethics programs as established by
management, the system of internal accounting and financial
controls, the audit process, the assessment of the needs for and role
of the Company's internal audit process and its performance and the
performance, qualification and independence of the Company's
independent auditors.
2. Authority of the Audit Committee:
a) The committee shall appoint, subject to the approval of the
Board and ratification by the Company's shareholders, and may
terminate, the Company's independent auditors. The committee
shall consult with the Company's Board regarding any such
decision.
b) The committee shall have the sole authority to approve audit
engagement fees and terms as well as any significant non-audit
relationship with the Company's independent auditors.
c) The committee shall, jointly with management, determine the
hiring of, or outsourcing of, the internal auditor who shall have
direct reporting responsibility to the committee. The committee
will approve appropriate compensation for this function.
d) The committee shall have the authority to retain special legal,
accounting or other consultants to advise and assist the
committee.
e) The committee may request any other director, officer or
employee of the Company or the Company's outside counsel,
or internal or independent auditor to attend a meeting of the
committee or to meet with any members of, or consultants to,
the committee.
f) The committee may form and delegate authority to
subcommittees when appropriate.
3. Audit Committee Composition:
a) The committee shall consist of at least three directors, including
a chairman, each selected from the Board, upon the
recommendation of the Nominating and Governance
Committee. Each member of the committee shall be
independent under the rules of the SEC and NYSE. Members
of the committee shall disclose to the Board whether they are
members of the audit committee of any other public companies.
If a member of the committee simultaneously serves on the
audit committees of more than three public companies, the
Board shall determine if such simultaneous service would
impair the ability of such prospective member to effectively
serve on the committee.
b) Each member of the committee shall have no relationship to the
Company that may interfere with the exercise of their
independence from management and the Company.
c) Each member of the committee shall have such level of
experience and expertise in accounting, financial and related
matters, as determined by the Board in its business judgment,
as shall enable him or her to effectively fulfill his or her duties
as a member of the committee. At least one member of the
committee shall have the attributes of an "audit committee
financial expert" (as defined by the U.S. Securities and
Exchange Commission) as determined by the Board.
d) The Company shall provide appropriate orientation for new
members of the committee, and ongoing continuing education
programs for existing members, covering, among other things,
current best practices, the Company's business, organizational
and management structure, results of operations and financial
condition, including critical accounting policies, budgets and
forecasts and corporate governance. Members of the committee
are encouraged, but not required, to periodically pursue or
obtain, at the Company's expense, appropriate programs,
sessions or materials as to the responsibilities of members of
the audit committee of publicly-traded companies.
4. Duties and responsibilities of the Audit Committee:
a) General:
(i) The committee shall meet at such intervals as it determines, but
not less frequently than quarterly.
(ii) If necessary, the committee shall institute special investigations
and, if appropriate, hire special counsel or experts to assist.
(iii) The committee shall meet regularly with the internal auditor
and the independent auditors in separate executive sessions.
(iv) The committee shall perform other oversight functions as
requested by the Board.
(v) The committee shall also have the ability to meet in executive
session with the Chief Executive Officer, the Chief Financial
Officer, or the General Counsel.
(vi) The committee shall review policies and processes related to
the evaluation of risk assessment and risk management,
including the Company's major financial risk exposures and the
steps management has taken to monitor and control such
exposures.
(vii) Annually prepare a report to shareholders as required by the
Securities and Exchange Commission. The report should be
included in the Company's annual proxy statement.
(viii) Perform any other activities consistent with this Charter,
the Company's by-laws, and governing law, as the Audit
Committee or the Board of Directors deems necessary or
appropriate.
(b) Internal Controls and Internal Audit
(i) The committee shall review policies and processes related to
the evaluation of the adequacy of the Company's internal
control structure.
(ii) The committee shall consider the results of internal controls
testing carried out by the Company.
(iii) The committee shall review all controls certifications made by
the Company for regulatory purposes under sections 302 and
404 of the Sarbanes-Oxley Act (2002).
(iv) The committee will review the internal audit function and
ensure it meets applicable corporate objectives.
(v) The committee will ensure that the internal audit function of the
Company is adequately and properly resourced.
(vi) At the beginning of each calendar year the committee will
review and approve the annual internal audit plan.
(vii) The committee will review all internal audit reports provided
by the internal auditor and consider the findings.
(viii) The committee shall review the performance of the
Company's internal audit function and report to the Board
as required.
c) Independent Audit and Independent Auditors:
(i) The committee shall appoint, subject to approval by the Board
and ratification by the Company's shareholders, and may
terminate the Company's independent auditors. The committee
shall consult with the Company's Board regarding any such
decision.
(ii) The committee shall review and approve the independent
auditor's' proposed audit scope, approach, staffing and fees.
(iii) The committee shall pre-approve all audits and permitted
non-audit services to be performed by the independent auditors
subject to such procedures as may be established by the
committee.
(iv) The committee shall, at least annually, obtain and review a
report by the Company's independent auditors describing the
firm's internal quality-control procedures, any material issues
raised by the most recent internal quality-control or peer review
of the firm, or by any inquiry or investigation by government
or professional authorities, within the preceding five years,
respecting one or more independent audits carried out by the
firm, and any steps taken to deal with any such issues.
(v) The committee shall receive on a periodic basis, not less
frequently than annually, from the independent auditors a
formal written statement delineating all relationships between
the independent auditors and the Company, including each
non-audit service provided to the Company.
(vi) The committee shall actively engage in a dialogue with the
independent auditors with respect to any disclosed relationships
or services that may impact the objectivity and independence
of the independent auditors.
(vii) The committee shall evaluate, together with the Board, the
qualifications, performance and independence of the
independent auditors, including the lead engagement partner,
and, if so determined by the committee, replace the
independent auditors or lead engagement partner.
(viii) The committee shall take appropriate action, including
recommending that the Board take appropriate action, as
necessary, in response to the independent auditors' report
to satisfy itself of the independent auditors' independence.
(ix) The committee shall discuss with the independent auditors the
matters required to be discussed by Statement on Auditing
Standards No. 61 relating to the conduct of the audit.
(x) The committee shall receive and review with management any
management letter provided by the independent auditors and
the Company's response to that letter; the committee shall
review with the independent auditors any problems or
difficulties the auditors may have encountered and any
disagreements with management.
(xi) The committee shall review and approve hiring policies for
employees or former employees of the independent auditors.
d) Financial Statement Review:
(i) The committee shall review and discuss with management and
the independent auditors the Company's annual audited
financial statements and Management's Discussion and
Analysis.
(ii) The committee shall review and discuss with management and
the independent auditors, the Company's quarterly financial
statements, Management's Discussion and Analysis and the
results of the independent auditors' review of the quarterly
financial statements.
(iii) The committee shall discuss with management and the
independent auditors significant financial reporting issues and
judgments, made in connection with the preparation of the
Company's financial statements, including any significant
changes in the Company's selection or application of
accounting principles (which shall be communicated to the
committee by the Company's chief financial officer as soon as
reasonably practicable), the selection and disclosure of critical
accounting estimates, and the effect of alternative assumptions,
estimates or accounting principles on the Company's financial
statements.
(iv) The committee shall discuss with management and the
independent auditors the effect of regulatory and accounting
initiatives as well as off-balance sheet structures, if any, on the
Company's financial statements.
e) Compliance Matters:
(i) The committee shall review with the Company's Counsel legal
and regulatory matters that may have a material impact on the
Company or its financial statements.
(ii) The committee shall review and approve procedures for the
receipt, retention and treatment of complaints regarding
accounting controls or auditing matters and for the confidential,
anonymous submission by employees of concerns regarding
questionable accounting, auditing or other matters.
f) Other:
(i) The committee shall have such other duties, responsibilities and
authorities as the Board may from time to time delegate.
(ii) The committee shall review and reassess the adequacy of this
Charter annually and recommend any proposed changes to the
Nominating and Governance Committee and the Board for
approval.
(iii) The committee shall annually review its own performance.
5. Reporting Responsibilities:
a) The committee shall keep a record of its proceedings.
b) The committee shall report to the Board.
[PROXY CARD - FRONT]
PROXY RESEARCH FRONTIERS INCORPORATED
240 Crossways Park Drive, Woodbury, New York 11797-2033
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS - June 11, 2009
The undersigned hereby appoints Robert L. Saxe and Joseph M.
Harary, or either of them, as Proxy or Proxies of the undersigned with full
power of substitution to attend and to represent the undersigned at the
Annual Meeting of Stockholders of Research Frontiers Incorporated to be
held on June 11, 2009, and at any adjournments thereof, and to vote thereat
the number of shares of stock of the Company the undersigned would be
entitled to vote if personally present, in accordance with the instructions set
forth on the reverse side hereof. Any proxy heretofore given by the
undersigned with respect to such stock is hereby revoked.
Dated:________________________________________________, 2009
__________________________________________________________
__________________________________________________________
Please sign exactly as name appears above. For joint
accounts, each joint owner must sign. Please give full title
if signing in a representative capacity.
PLEASE MARK, DATE AND SIGN THIS PROXY AND RETURN
IT IN THE ENCLOSED ENVELOPE
[PROXY CARD - BACK]
1. ELECTION OF DIRECTORS
NOMINEES: Joseph M. Harary, Richard Hermon-Taylor and
M.PhilipGuthrie
[ ] FOR ALL nominees listed above.
[ ] FOR ALL nominees listed above
EXCEPT:_________________________________________
(Instruction: To withhold authority to vote on any individual
nominee, write the name in the space at the right.)
[ ] WITHHOLD AUTHORITY to vote for all nominees listed above.
2. RATIFICATION OF THE SELECTION OF BDO SEIDMAN,
LLP AS INDEPENDENT REGISTERED PUBLIC
ACCOUNTANTS OF THE COMPANY FOR THE FISCAL
YEAR ENDING DECEMBER 31, 2009.
[ ] FOR RATIFICATION [ ] AGAINST RATIFICATION [ ] ABSTAIN
3. In their discretion, upon such other matters as may properly
come before the meeting. If no specification is made, this proxy
will be voted FOR the nominees listed above and FOR
APPROVAL of Proposal 2.
Please indicate whether or not you plan to attend the Annual Meeting on
Thursday, June 11, 2009.
Yes [ ] No [ ]