UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. 1 )
Filed by the Registrant
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Filed by a Party other than the Registrant
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Check the appropriate box:
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Preliminary Proxy Statement
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Confidential for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to (S) 240.14a-12
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OPNET TECHNOLOGIES, INC.
(Name of Registrant as Specified In Its
Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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(1)
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Title of each class of securities to which transaction applies:
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(2)
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Aggregate number of securities to which transaction applies:
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(3)
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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):
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(4)
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Proposed maximum aggregate value of transaction:
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement No.:
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OPNET TECHNOLOGIES, INC.
7255 WOODMONT AVENUE
BETHESDA, MARYLAND 20814
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON TUESDAY, SEPTEMBER 9, 2008
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of OPNET
Technologies, Inc. (the Company) will be held at the principal executive offices of the Company, 7255 Woodmont Avenue, Bethesda, Maryland 20814, on Tuesday, September 9, 2008 at 10:00 a.m., local time, for the purpose of considering
and voting upon the following matter:
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1.
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To elect two Class II directors for a three-year term extending until the 2011 Annual Meeting of Stockholders; and
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2.
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To transact such other business, if any, as may properly come before the Annual Meeting or any adjournments thereof.
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The Board of Directors has no knowledge of any other business to be transacted at the Annual Meeting.
Holders of record of the Companys Common Stock at the close of business on July 21, 2008 are entitled to notice of and to vote at the Annual
Meeting and at any adjournments thereof. A list of the Companys stockholders is open for examination to any stockholder at the principal executive offices of the Company, 7255 Woodmont Avenue, Bethesda, Maryland 20814 and will be available at
the Annual Meeting.
A copy of the Companys Annual Report for the year ended March 31, 2008, which contains financial statements
and other information of interest to stockholders, accompanies this Notice and the enclosed Proxy Statement.
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By Order of the Board of Directors,
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/s/ Marc A. Cohen
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Marc A. Cohen
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Chairman of the Board, Chief Executive Officer and Secretary
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Bethesda, Maryland
July 25, 2008
YOUR VOTE IS IMPORTANT.
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN PERSON. WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, YOU MAY VOTE YOUR SHARES EITHER: (I) OVER THE INTERNET AS INSTRUCTED IN THESE MATERIALS; OR
(II) IF YOU RECEIVED A PAPER COPY OF THESE MATERIALS, BY SIGNING, DATING AND RETURNING THE PROXY CARD AS PROMPTLY AS POSSIBLE IN ORDER TO ENSURE YOUR REPRESENTATION AT THE MEETING. IF YOU ARE RECEIVING THESE PROXY MATERIALS BY MAIL, A RETURN
ENVELOPE (WHICH IS POSTAGE PREPAID IF MAILED IN THE UNITED STATES) IS ENCLOSED FOR YOUR CONVENIENCE. STOCKHOLDERS WHO EXECUTE A PROXY CARD OR VOTE ON THE INTERNET MAY NEVERTHELESS ATTEND THE ANNUAL MEETING, REVOKE THEIR PROXY AND VOTE THEIR SHARES
IN PERSON.
OPNET TECHNOLOGIES, INC.
7255 WOODMONT AVENUE
BETHESDA, MARYLAND 20814
PROXY STATEMENT FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON TUESDAY, SEPTEMBER 9, 2008
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of OPNET Technologies, Inc., a Delaware corporation (the Company), of proxies for use at the Annual Meeting of Stockholders to be held at the principal executive offices of the Company, 7255
Woodmont Avenue, Bethesda, Maryland 20814, on September 9, 2008 at 10:00 a.m., local time, and at any adjournments thereof (the Annual Meeting).
All executed proxies will be voted in accordance with the stockholders instructions, and if no choice is specified, executed proxies will be voted in favor of the matter set forth in the accompanying Notice of
Meeting. Any proxy may be revoked by a stockholder at any time before its exercise by delivery of written revocation or a subsequently dated proxy to the Secretary of the Company or by voting in person at the Annual Meeting. Attendance at the Annual
Meeting will not itself be deemed to revoke a proxy unless the stockholder gives affirmative notice at the Annual Meeting that the stockholder intends to revoke the proxy and vote in person.
The Board of Directors has fixed July 21, 2008 as the record date (the Record Date) for determining holders of the Companys Common
Stock, $.001 par value per share (the Common Stock), who are entitled to vote at the Annual Meeting. At the close of business on the Record Date, there were outstanding and entitled to vote an aggregate of 20,437,185 shares of Common
Stock. Each share of Common Stock entitles the record holder thereof to one vote on the matter to be voted on at the Annual Meeting.
We
are pleased to take advantage of the Securities and Exchange Commission (the SEC) rule allowing companies to furnish proxy materials to their stockholders over the Internet. We believe that this new e-proxy process will expedite
stockholders receipt of proxy materials and lower the costs and reduce the environmental impact associated with our Annual Meeting. On or about July 25, 2008, we mailed the Notice of Internet Availability of Proxy Materials (the
Internet Notice) containing instructions on how to access our proxy statement and vote online. The Internet Notice contains instructions on how you can (i) receive a paper copy of the proxy statement or (ii) elect to receive
your proxy statement over the Internet in future years, if you received them by mail this year.
Householding of Proxy Materials
The SEC has adopted rules that permit companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy statements and annual
reports, and Notices of Internet Availability of Proxy Materials with respect to two or more stockholders sharing the same address by delivering a single proxy statement, annual report or Notice of Internet Availability of Proxy Materials, as
applicable, addressed to those stockholders. This process, which is commonly referred to as householding, potentially means extra convenience for stockholders and cost savings for companies.
Some banks, brokers and other nominee record holders may be participating in the practice of householding proxy statements, annual reports, and notices
of Internet availability of proxy materials. This means that only one copy of the Internet Notice, this Proxy Statement or the Companys Annual Report may have been sent to multiple stockholders in your household. We will promptly deliver a
separate copy of any of these documents to you if you call or write to us at the following address or telephone number: OPNET Technologies, Inc., 7255 Woodmont Avenue, Bethesda, Maryland, 20814, telephone: (240) 497-3000, Attention: Investor
Relations. If you want to receive separate copies of our notices of Internet availability of proxy materials, annual reports, and proxy statements in the future, or if you are receiving multiple copies and would like to receive only one copy for
your household, you should contact your bank, broker or other nominee record holder, or you may contact us at the above address and phone number.
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How to Vote
You may either vote For each of the nominees to the Board of Directors or you may Withhold your vote for either nominee you specify. For each of the other matters to be voted on, if any, you may vote For
or Against or abstain from voting. The procedures for voting are fairly simple:
Stockholders of Record:
If you are
a stockholder of record, there are three ways to vote:
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by completing and returning your proxy card, or
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by written ballot at the meeting, or
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by voting on the Internet. To vote on the Internet, go to www.proxyvote.com to complete an electronic proxy card. You will be asked to provide the Company number
and control number from the enclosed proxy card. Your vote must be received by 11:59 p.m. Eastern Time on September 8, 2008 to be counted.
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Street Name Holders:
Shares which are held in a brokerage account in the name of the broker are said to be held in street name. If your shares are held in street name, the Internet Notice was
forwarded to you by that organization and you should follow the voting instructions provided by your broker. You may complete and return a voting instruction card to your broker. Check your proxy card for more information. If you hold your shares in
street name and wish to vote at the meeting, you must obtain a legal proxy from your broker and bring that proxy to the meeting.
We provide Internet proxy voting to allow you to vote your shares on-line, with procedures designed to ensure the
authenticity and correctness of your proxy vote instructions. However, please be aware that you must bear any costs associated with your Internet access, such as usage charges from Internet access providers and telephone companies.
Votes Required
The holders of a majority of the
shares of Common Stock issued and outstanding and entitled to vote at the Annual Meeting will constitute a quorum for the transaction of business at the Annual Meeting. Shares of Common Stock present in person or represented by proxy (including
shares which abstain or do not vote with respect to one or more of the matters presented for stockholder approval) will be counted for purposes of determining whether a quorum exists at the Annual Meeting.
The affirmative vote of the holders of shares of Common Stock representing a plurality of the votes cast on the matter is required for the election of
the Class II directors.
Shares which abstain from voting as to a particular matter, and shares held in street name by brokers
or nominees who indicate on their proxies that they do not have discretionary authority to vote such shares as to a particular matter, will not be counted as votes in favor of such matter, and will also not be counted as shares voting on such
matter. Accordingly, abstentions and broker non-votes will have no effect on the voting on matters that require the affirmative vote of a certain percentage of the votes cast or the shares voting on the matter.
Preliminary voting results will be announced at the Annual Meeting. Final voting results will be published in our Quarterly Report on Form 10-Q for the
quarter ending September 30, 2008, which we will file with the SEC.
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Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding the beneficial ownership of the Companys Common Stock as of July 21, 2008 by:
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each person known to the Company to beneficially own more than 5% of the outstanding shares of Common Stock;
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each director and nominee for director of the Company;
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each of the executive officers of the Company; and
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all executive officers, directors and nominees for director of the Company as a group.
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Except as set forth herein, the business address of the named beneficial owner is c/o OPNET Technologies, Inc., 7255 Woodmont Avenue, Bethesda, Maryland
20814 and each person or entity named in the table has sole voting power and investment power (or shares such power with his spouse) with respect to all shares of Common Stock indicated as owned by such person or entity. Applicable percentages are
based on 20,437,185 shares outstanding as of July 21, 2008.
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Name and Address of Beneficial Owner
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Number of Shares
Beneficially
Owned (1)
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Percent of Class
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Marc A. Cohen
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2,936,162
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(2)
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14.2
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Alain J. Cohen
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4,767,058
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(3)
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23.2
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Mel F. Wesley
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30,990
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(4)
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*
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Steven G. Finn
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113,000
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(5)
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*
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Ronald W. Kaiser
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48,000
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(6)
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*
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William F. Stasior
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138,000
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(7)
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*
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All executive officers, directors and nominees for director, as a group
(6 persons)
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8,033,210
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(8)
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38.2
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Austin W. Marxe and David M. Greenhouse, and related filers, 527 Madison Avenue, Suite 2600, New York, NY 10022
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1,989,818
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(9)
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9.7
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S Squared Technology, LLC and related filers, 515 Madison Avenue, New York, NY 10022
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1,824,100
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(10)
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8.9
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(1)
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The number of shares beneficially owned by each director, nominee for director, executive officer and stockholder is determined under rules promulgated by the Securities and
Exchange Commission (SEC), and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any shares as to which the individual has sole or shared voting
power or investment power and also any shares which the individual has the right to acquire within 60 days after July 21, 2008 through the exercise of any stock option or other right. The inclusion herein of such shares, however, does not
constitute an admission that the named stockholder is a direct or indirect beneficial owner of such shares.
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(2)
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Includes 273,000 shares of Common Stock issuable upon exercise of options that are currently exercisable or exercisable within 60 days after July 21, 2008.
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(3)
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Includes 75,000 shares of Common Stock issuable upon exercise of options that are currently exercisable or exercisable within 60 days after July 21, 2008.
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(4)
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Includes 10,000 shares of Common Stock issuable upon exercise of options that are currently exercisable or exercisable within 60 days after July 21, 2008.
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(5)
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Includes 90,000 shares of Common Stock issuable upon exercise of options that are currently exercisable or exercisable within 60 days after July 21, 2008.
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(6)
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Consists of 45,000 shares of Common Stock issuable upon exercise of options that are currently exercisable or exercisable within 60 days after July 21, 2008.
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(7)
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Includes 90,000 shares of Common Stock issuable upon exercise of options that are currently exercisable or exercisable within 60 days after July 21, 2008.
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(8)
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Includes 583,000 shares of Common Stock issuable upon exercise of options that are currently exercisable or exercisable within 60 days after July 21, 2008.
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(9)
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The address and number of shares of Common Stock beneficially owned by Austin W. Marxe and David M. Greenhouse are based solely on the Schedule 13G filed with the SEC on
February 13, 2008 which reports shared power to vote and dispose of all shares stated in the above table.
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(10)
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Represents combined holdings of S Squared Technology LLC and S Squared Technology Partners, L.P. The address and number of shares of Common Stock beneficially owned by S Squared
Technology LLC and S Squared Technology Partners, L.P. are based solely on the Schedule 13G filed with the SEC on January 15, 2008, which reports sole power to vote and dispose of all shares stated in the above table.
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PROPOSAL 1ELECTION OF DIRECTORS
The Company has a classified Board of Directors currently consisting of one Class I director, two Class II directors and two Class III directors. The Class I, Class II and Class III directors will serve until the annual meeting of
stockholders to be held in 2010, 2008 and 2009, respectively, and until their respective successors are duly elected and qualified. At each annual meeting of stockholders, directors are elected for a full term of three years to succeed those
directors whose terms are expiring.
The persons named in the enclosed proxy will vote to elect Alain J. Cohen and Steven G. Finn as the
Class II directors, unless authority to vote for Mr. Cohen or Mr. Finn is withheld by marking the proxy to that effect. Each Class II director will be elected to hold office until the 2011 annual meeting of stockholders (subject to the
election and qualification of his successor and to his earlier death, resignation or removal).
Mr. Cohen and Mr. Finn have
indicated their willingness to serve, if elected, but if either should be unable to serve, the person acting under the proxy may vote the proxy for a substitute nominee designated by the Board of Directors. The Board of Directors has no reason to
believe that Mr. Cohen or Mr. Finn will be unable to serve if elected.
For each member of the Board of Directors whose term of
office as a director continues after the Annual Meeting, including Mr. Cohen and Mr. Finn, there follows information given by that director concerning his principal occupation and business experience for at least the past five years, the
names of other publicly held companies of which he serves as a director and his age and length of service as a director of the Company. There are no family relationships among any of the directors, nominees for director and executive officers of the
Company, except that Marc A. Cohen and Alain J. Cohen are brothers. Information with respect to the number of shares of Common Stock beneficially owned by each director and the nominee for director, directly or indirectly, as of July 21, 2008
appears under the heading Security Ownership of Certain Beneficial Owners and Management.
Nominees for Terms Expiring in 2011 (Class II
Directors)
Alain J. Cohen
, one of the Companys founders, is 41 years old and has served as the Companys
President and Chief Technology Officer and as a member of the Board of Directors since the Companys inception in 1986. Mr. Cohen received a bachelors degree in electrical engineering from the Massachusetts Institute of Technology
(M.I.T.).
Steven G. Finn
is 62 years old and has served as a member of the Board of Directors since March 1998.
Mr. Finn has been a principal research scientist and lecturer at M.I.T. since 1991. Mr. Finn has also served as a consultant with Matrix Partners, a venture capital firm, since 1991.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE DIRECTOR NOMINEES LISTED ABOVE.
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Directors Whose Terms Expire in 2009 (Class III Directors)
Marc A. Cohen
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one of the Companys founders, is 45 years old and has served as the Chairman of the Board since the
Companys inception in 1986 and as the Companys Chief Executive Officer since 1994. From 1986 to 1992, Mr. Cohen was also a consultant with Booz Allen Hamilton Inc. (Booz Allen), an international management and consulting
company. Mr. Cohen received a bachelors degree in engineering science from Harvard University and a masters degree in electrical engineering from Stanford University. Mr. Cohen also serves as a Trustee and as a member of the
Board of Directors of the Dana-Farber Cancer Institute in Boston, Massachusetts.
William F. Stasior
is 67 years old and has
served as a member of the Board of Directors since March 1998. Since October 1999, he has served as senior chairman of Booz Allen. From 1991 to 1999, he served as Chairman and Chief Executive Officer of Booz Allen. Mr. Stasior currently serves
on the Board of Directors of SkyTerra Communications, Inc., a telecommunications service provider.
Director Whose Term Expires in 2010 (Class I
Director)
Ronald W. Kaiser
is 54 years old and has served as a member of our Board of Directors since October 2003. Since
January 2008, he has been an independent consultant and board member for companies in the technology and life sciences fields. From January 2007 through December 2007, Mr. Kaiser served as Chief Financial Officer of Sucampo Pharmaceuticals,
Inc., a specialty pharmaceutical company. Mr. Kaiser served as Chief Financial Officer of Pharmathene, Inc., a privately held bio-defense company from April 2005 through December 2006. Mr. Kaiser served as Chief Financial Officer,
Treasurer and Secretary of Air Cargo, Inc., a privately held provider of United States and European cargo transportation logistics from February 2003 through March 2005. Air Cargo filed for Chapter 11 bankruptcy on December 7, 2004.
Mr. Kaiser served as Chief Financial Officer and Treasurer of OTG Software, Inc. (OTG), from June 1998 until the sale of OTG to Legato Systems, Inc. in May 2002. OTG was a publicly traded corporation that provided online data
storage and data access software products for business applications, email management and related services. Mr. Kaiser serves on the board of directors of Vocus, Inc., a provider of public relations management software.
Board Determination of Independence
Under Nasdaq
rules, a director of the Company will only qualify as an independent director if, in the opinion of the Board of Directors, that person does not have a relationship which would interfere with the exercise of independent judgment in
carrying out the responsibilities of a director. The Board of Directors has determined that none of Messrs. Finn, Kaiser or Stasior has a relationship which would interfere with the exercise of independent judgment in carrying out the
responsibilities of a director and that each of these directors is an independent director as defined under Rule 4200(a)(15) of the Nasdaq OMX Group, Inc. Marketplace Rules.
Board Meetings and Attendance
The Board of Directors met four times (including by teleconference)
during fiscal 2008. Each director attended at least 75% of the aggregate of the meetings of the Board of Directors and meetings of the committees on which he then served.
Director Attendance at the Annual Meeting
The Board of Directors does not have a policy with regard
to attendance by directors at annual meetings. Two of the directors attended the 2007 annual meeting of stockholders.
Board Committees
The Board of Directors has established three standing committeesAudit, Compensation and Nominating each of which operates under a charter
that has been approved by the Board.
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The Board of Directors has determined that all of the members of each of the Boards three standing
committees are independent as defined under the rules of the Nasdaq Global Market including, in the case of all members of the Audit Committee, the independence requirements contemplated by Rule 10A-3 under the Exchange Act. In addition, all of the
members of the Audit Committee satisfy all other Nasdaq eligibility requirements for Audit Committee membership.
The Audit Committee is
currently composed of Messrs. Finn, Kaiser, and Stasior. The Board has determined that Mr. Kaiser is an audit committee financial expert as defined in Item 401(h) of Regulation S-K. The Audit Committee met six times (including
by teleconference) during fiscal 2008. The functions of the Audit Committee include:
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appointment of the Companys independent auditors;
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reviewing the independence of the independent auditors;
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reviewing the annual audit plan of the independent auditors, the results of the independent audit, and the report and recommendations of the independent auditors;
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evaluating the adequacy of the Companys internal financial and accounting processes and controls; and
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reviewing with management and the independent auditors the annual and interim financial statements of the Company.
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A copy of the charter of the Audit Committee is available on the Investor Relations section of the Companys website at
www.opnet.com
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The Compensation Committee, which is currently composed of Messrs. Finn, Kaiser, and Stasior, reviews executive
salaries, administers the Companys bonus, incentive compensation and stock plans and approves the salaries and other benefits of the Companys executive officers. In addition, the Compensation Committee consults with the Company's
management regarding the Companys benefit plans and compensation policies and practices. The Compensation Committee met four times during fiscal 2008. A copy of the charter of the Compensation Committee is available on the Investor
Relations section of the Companys website at
www.opnet.com
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The Nominating Committee is currently composed of Messrs.
Finn, Kaiser, and Stasior. The Nominating Committee met once during fiscal 2008. The function of the Nominating Committee is to recommend to the Board of Directors the persons to be nominated for election as directors at any meeting of stockholders.
Director Candidates
Except where the
Company is legally required to provide third parties the right to nominate directors, the Nominating Committee is responsible for recommending to the Board of Directors all nominees for election as directors at any meeting of stockholders and the
persons to be elected by the Board of Directors to fill any vacancies on the Board. Stockholders have the right under the Companys Bylaws to directly nominate director candidates, without any action or recommendation on the part of the Board,
by following the procedures set forth under Stockholder Proposals for 2009 Annual Meeting.
The criteria for selecting all
director nominees are specified in the charter of the Nominating Committee. In selecting director nominees for recommendation to the Board of Directors the Nominating Committee considers: i) the nominees reputation for integrity, honesty and
adherence to high ethical standards, ii) the nominees demonstrated business acumen, financial literacy, experience and ability to exercise sound judgments in matters that relate to the current and long-term objectives of the Company, and iii)
whether the nominee is willing and able to contribute positively to the decision-making process of the Company. A copy of the charter of the Nominating Committee is available on the Investor Relations section of the Companys
website at
www.opnet.com
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Stockholder Communications with the Board
Shareholders may communicate with the Board or any of the directors by sending written communications addressed to the Board or any of the directors, c/o
Corporate Secretary, OPNET Technologies, Inc., 7255 Woodmont Avenue, Bethesda, MD 20814. The Chairman of the Board, with the assistance of the Companys General Counsel, is primarily responsible for monitoring communications from stockholders
and for providing copies or summaries to the other directors.
Code of Business Conduct and Ethics
The Company has adopted a code of business conduct and ethics that applies to all Company directors, officers and employees, including the Companys
principal executive officer, principal financial officer, and principal accounting officer or controller, or persons performing similar functions. A copy of the code of business conduct and ethics is posted on the Investor Relations
section of the Companys website at
www.opnet.com.
The Company intends to satisfy the disclosure requirements under Item 10 of Form 8-K regarding amendments to, or waivers from, the code of business conduct and ethics by either
providing such information on a Form 8-K filed with the SEC or by posting such information on the Investor Relations section of the Companys website at
www.opnet.com
. Information contained on the website is not part of this
proxy statement.
Securities Authorized for Issuance Under Equity Compensation Plans
The following table provides information about the securities authorized for issuance under the Companys equity compensation plans as of
March 31, 2008:
Equity Compensation Plan Information
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Plan Category
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Number of securities
to be issued upon
exercise of outstanding
options,
warrants and
rights
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Weighted-
average
exercise price of
outstanding
options, warrants
and rights ($)
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Number of securities
remaining available for
future issuance under
equity compensation
plans
(excluding
securities reflected in
column (a)) (1)
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Equity compensation plans approved by security holders
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2,720,121
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10.79
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2,180,225
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(2)
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Equity compensation plans not approved by security holders
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Total
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2,720,121
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10.79
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2,180,225
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(1)
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In addition to being available for future issuance upon exercise of options that may be granted after March 31, 2008, all of the remaining 2,167,321 shares under the
Companys Amended and Restated 2000 Stock Incentive Plan (the 2000 Incentive Plan) may instead be issued in the form of restricted stock, stock appreciation rights or other stock-based awards.
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(2)
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Includes 12,904 shares issuable under the Companys 2000 Employee Stock Purchase Plan (the ESPP), including shares issuable in connection with the current offering
period which ends on July 31, 2008. Also includes 2,167,321 shares issuable under the 2000 Incentive Plan. Under the 2000 Incentive Plan, the number of shares available for issuance automatically increases on the first trading day of each
calendar year by an amount equal to 3% of the shares of Common Stock outstanding on the last trading day of the preceding calendar year, not to exceed an annual increase of 1,000,000 shares, or a lesser amount determined by the Board. The Board did
not approve any increase in shares for issuance on the first trading day of calendar year 2008.
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Compensation Committee Interlocks and Insider Participation
The current members of the Compensation Committee are Messrs. Finn, Kaiser, and Stasior. No executive officer of the Company has served as a director or
member of the compensation committee (or other committee serving an equivalent function) of any other entity, one of whose executive officers served as a director or member of the Compensation Committee of the Company.
Report of the Compensation Committee of the Board of Directors
The Compensation Committee has reviewed and discussed the following Compensation Discussion and Analysis with management. Based on this review and discussion, the Compensation Committee recommended to the Board of
Directors that the Compensation Discussion and Analysis be included in this proxy statement and incorporated into our Annual Report on Form 10-K for the fiscal year ended March 31, 2008.
By the Compensation Committee of the Board of Directors.
Steven G. Finn,
Ronald W. Kaiser
William F. Stasior
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COMPENSATION DISCUSSION AND ANALYSIS
The following discussion and analysis relates to our executive compensation program for the fiscal year ended March 31, 2008.
Compensation Philosophy
The
goals of the Board of Directors and the Compensation Committee with respect to executive compensation are to align compensation with business objectives and performance, to enable us to attract, retain and reward executive officers and other key
employees who contribute to our long-term success, and to establish an appropriate relationship between executive compensation and the creation of long-term stockholder value. To meet these goals, the Compensation Committee has adopted a mix among
the compensation elements of salary, cash bonus and stock options.
The Board of Directors and the Compensation Committee also believe that
the compensation of the Chief Executive Officer and the other executive officers should be based to a substantial extent on our performance and adjusted, as appropriate, based on the executive officers performance against personal performance
objectives. Generally, when establishing salaries, bonus levels and stock awards for executive officers, the Compensation Committee considers: (i) our financial performance during the past year and recent quarters, (ii) the
individuals performance during the past year and recent quarters and (iii) the salaries of executive officers in similar positions of companies of comparable size and capitalization and other companies within the network and application
performance management software industry.
We have not retained a compensation consultant to review our policies and procedures relating to
executive compensation and we have not formally benchmarked our compensation to that of other companies. The Compensation Committee does, however, informally consider competitive market practices by speaking to recruitment agencies and reviewing
publicly available information relating to compensation of executives at other companies in our industry.
Compensation Components
The four major components of our executive officer compensation program are (i) base salary, (ii) annual incentive awards
in the form of discretionary cash bonuses, (iii) long-term, equity-based incentive awards, and (iv) employee benefits, such as 401(k) matching payments and health and life insurance.
We have not currently adopted any formal or informal policy for allocating compensation between long-term and short-term compensation or between cash and
non-cash compensation. We view each of the elements of our compensation program as related but distinct. Our decisions about each individual element do not necessarily affect the decisions we make about other elements. For example, we do not believe
that significant compensation derived from one elements of compensation should necessarily negate or reduce compensation from other elements.
Base Salary.
The Compensation Committee meets periodically to set the base salary levels of our executive officers. Effective April 2008, the Compensation Committee increased Marc Cohens and Alain Cohens annual base
salaries to $325,000. For fiscal 2008, the annual base salaries of Marc Cohen and Alain Cohen remained unchanged from their levels at the end of fiscal 2007, specifically $300,000 for Marc Cohen and $300,000 for Alain Cohen. During fiscal 2008, the
Compensation Committee increased the base salary of Mel Wesley from $172,000 to $190,000, effective July 1, 2007. Effective April 2008, the Compensation Committee increased Mel Wesleys annual base salary to $220,000. When reviewing base
salaries the Compensation Committee considered individual and corporate performance, levels of responsibility, prior experience, breadth of knowledge, and competitive pay practices. The Compensation Committee recognizes the importance of maintaining
compensation practices and levels of compensation competitive with other software companies in our industry and anticipates reviewing compensation packages at least annually.
9
Discretionary Cash Bonus.
The Compensation Committee has the authority
to award discretionary cash bonuses to our executives from time to time. Our cash bonus program is designed to motivate executives to work effectively to achieve our financial performance objectives and to reward them when objectives are met. The
Compensation Committee did not award any cash bonuses to our executives in fiscal 2008.
Equity-Based Incentive
Compensation.
We established our Amended and Restated 2000 Stock Incentive Plan (the 2000 Incentive Plan) to provide all employees, including executive officers, with an opportunity to share, along with our stockholders, in the
long-term performance of our company. The Compensation Committee believes that a primary goal of the compensation program is to provide key employees who have significant responsibility for the management, growth and future success of our company
with the opportunity to participate in the financial gain from price increases in our Common Stock. In addition, the vesting feature of our equity grants are intended to further our goal of executive retention because this feature provides an
incentive to our executives to remain in our employ during the vesting period.
Executives are eligible to receive stock options giving
them the right to purchase shares of Common Stock in the future at a price equal to the fair market value on the date of grant. Historically, our equity awards have typically taken the form of stock options, although we did not grant options to any
executive officer during fiscal 2008. Executives are also eligible to receive grants of restricted stock, and we have begun in recent periods to rely much more significantly on restricted stock grants in lieu of stock options. We typically grant
restricted stock awards at no cost to the executive. Because the shares have a built-in value at the time the restricted stock grants are made, we generally grant significantly fewer shares of restricted stock than the number of stock options we
would grant for a similar purpose.
During fiscal 2007, we implemented a new incentive program whereby we make discretionary quarterly
grants of restricted stock to our executives and other key employees. Under this program, following the end of each quarter, the Compensation Committee establishes a bonus pool, denominated in dollars, based primarily on our financial performance
for the prior quarter, particularly revenue, and on other factors. The size of this bonus pool for each quarter, and whether to have a bonus pool at all, are entirely in the discretion of the Compensation Committee. If a bonus pool is established,
our Chief Executive Officer recommends its allocation among the executives and other key employees, based primarily on his subjective judgment about the performance of each of them, and submits that recommendation to the Compensation Committee. The
Compensation Committee determines the final allocation of the bonus pool among the executives and other key employees, thereby determining a dollar-denominated bonus for each. These dollar-denominated bonuses are subsequently translated into a
number of shares of restricted stock based on the closing price of our Common Stock as reported on the Nasdaq Global Market on the third trading day following our quarterly earnings release, which is also the date of the actual restricted stock
grant. During fiscal 2008, we granted 4,547 shares of restricted stock to Marc Cohen, 4,547 shares to Alain Cohen and 9,863 shares to Mel Wesley under this program. These shares were granted at various times during fiscal 2008.
Each of these grants vests as to one-third of the shares on each of the second, third and fourth anniversaries of the grant date. If the executive ceases
to be an employee, officer or director of, or consultant or advisor to, our company or a parent or subsidiary of our company, any shares that are not then vested are subject to forfeiture without payment to the executive. In the event we experience
a change-of-control event, as specified in the 2000 Incentive Plan, these grants automatically become vested in full.
We currently have a
policy of granting equity awards on the third trading day following our earnings release in each quarter. In the case of stock options, we establish the exercise price based on the closing price of our Common Stock as reported on the Nasdaq Global
Market on the grant date. Likewise, in the case of restricted stock, if the number of shares is being determined on the basis of a dollar-denominated bonus as described above, we translate the dollar-denominated bonus into a number of shares of
Common Stock in the same manner.
We do not have any equity ownership guidelines for our executive officers.
10
Employee Benefits.
Our executives are eligible to participate in the same medical, dental, life,
disability and accident insurance programs that are available to all of our U.S.-based employees. The executives are also eligible to participate in our 401(k) savings plans on the same terms as all of our U.S.-based employees. Our 401(k) savings
plan provides a company match of up to 3% of cash compensation corresponding to one-half the amount contributed by the participant. We offer no deferred compensation plan, no traditional pension plan, and no company-paid retiree benefits.
Compliance with Internal Revenue Code Section 162(m)
Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for compensation in excess of $1.0 million paid
to the companys chief executive officer and four other most highly compensated officers. Qualifying performance-based compensation will not be subject to the deduction limitation if certain requirements are met. The Compensation Committee
periodically reviews the potential consequences of Section 162(m) and may structure the performance-based portion of its executive compensation to comply with certain exemptions in Section 162(m). However, the Compensation Committee
reserves the right to use its judgment to authorize compensation payments that do not comply with the exemptions in Section 162(m) when the Compensation Committee believes that such payments are appropriate and in the best interests of the
stockholders, after taking into consideration changing business conditions or the officers performance.
Executive Compensation
Summary Compensation Table
The
following table sets forth summary information concerning the total compensation awarded to, paid to or earned by each of our executive officers in each of the last three fiscal years.
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|
|
|
|
|
|
|
|
|
|
|
|
Name and Principal Position
|
|
Year
|
|
Salary
($)
|
|
Bonus
($)
|
|
Stock
Awards
(1)
($)
|
|
Option
Awards
(1) ($)
|
|
All Other
Compensation
(2) ($)
|
|
Total
($)
|
|
|
|
|
|
|
|
|
Restricted
Stock
|
|
Stock
Options
|
|
|
|
|
Marc A. Cohen
|
|
2008
|
|
300,000
|
|
|
|
48,689
|
|
|
|
3,000
|
|
351,689
|
Chief Executive Officer
|
|
2007
|
|
300,000
|
|
|
|
26,990
|
|
154
|
|
3,000
|
|
330,144
|
|
|
2006
|
|
250,000
|
|
|
|
1,846
|
|
|
|
3,000
|
|
254,846
|
|
|
|
|
|
|
|
|
Alain J. Cohen
|
|
2008
|
|
300,000
|
|
|
|
48,689
|
|
|
|
|
|
348,689
|
President and Chief Technology Officer
|
|
2007
|
|
300,000
|
|
|
|
26,990
|
|
|
|
|
|
326,990
|
|
|
2006
|
|
250,000
|
|
|
|
1,846
|
|
|
|
|
|
251,846
|
|
|
|
|
|
|
|
|
Mel F. Wesley
|
|
2008
|
|
190,000
|
|
|
|
36,792
|
|
20,134
|
|
3,225
|
|
250,151
|
Chief Financial Officer
|
|
2007
|
|
170,250
|
|
10,000
|
|
24,330
|
|
20,134
|
|
3,000
|
|
227,714
|
|
|
2006
|
|
145,000
|
|
|
|
2,992
|
|
|
|
1,083
|
|
149,075
|
(1)
|
This column reflects the amount we recorded as stock-based compensation in our financial statements for the respective fiscal year in connection with restricted stock and stock
option grants, including grants from prior years. The assumptions we used in determining stock based compensation are described under the caption Stock-Based Compensation in Note 2 to our consolidated financial statements included in our
Annual Report on Form 10-K for the year ended March 31, 2008 filed with the SEC. Unlike the amount reflected in our consolidated financial statements, however, the amounts shown above do not reflect any estimate of forfeitures related to
service-based vesting. Instead, it assumes that the executive will perform the requisite service to vest in the award.
|
(2)
|
Represents matching contributions under our 401(k) plan.
|
11
Grants of Plan-Based Awards
The following table sets forth summary information regarding all grants of plan-based awards made to our executive officers for the fiscal year ended
March 31, 2008.
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|
|
|
|
|
|
|
|
Name
|
|
Grant
Date
|
|
Approval
Date
(1)
|
|
All Other
Stock Awards:
Number of
Shares of
Stock
(2)
|
|
Grant Date Fair Value
of Stock Award
(3)
($)
|
Marc A. Cohen
|
|
5/31/07
|
|
5/31/07
|
|
2,773
|
|
31,252
|
|
|
2/6/08
|
|
1/23/08
|
|
1,774
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15,434
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|
|
|
|
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Alain J. Cohen
|
|
5/31/07
|
|
5/31/07
|
|
2,773
|
|
31,252
|
|
|
2/6/08
|
|
1/23/08
|
|
1,774
|
|
15,434
|
|
|
|
|
|
Mel F. Wesley
|
|
5/31/07
|
|
5/31/07
|
|
555
|
|
6,255
|
|
|
8/3/07
|
|
7/25/07
|
|
3,064
|
|
29,997
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|
|
2/6/08
|
|
1/23/08
|
|
497
|
|
4,324
|
|
|
2/6/08
|
|
1/23/08
|
|
5,747
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49,999
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(1)
|
Reflects the date on which the grant was approved by the Compensation Committee.
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(2)
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Reflects grants of restricted stock at no cost to the executive.
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(3)
|
This column reflects the total amount we will record as a stock-based compensation in our financial statements in connection with the respective restricted stock grant over the
entire four-year vesting period of the grant. The assumptions we used in determining stock based compensation are described under the caption Stock-Based Compensation in Note 2 to our consolidated financial statements included in our
Annual Report on Form 10-K for the year ended March 31, 2008 filed with the SEC.
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Outstanding Equity Awards at
Fiscal Year End
The following table sets forth summary information regarding the outstanding equity awards at March 31, 2008
held by each of our executive officers. All of these awards were granted under the 2000 Incentive Plan.
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|
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|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
Name
|
|
Number of Securities
Underlying Unexercised
Options
|
|
Option
Exercise
Price
($)
|
|
Option
Expiration
Date
|
|
Number
of Shares
of Stock
That
Have Not
Vested
(2)
|
|
Market Value
of Shares of
Stock That
Have Not
Vested
(3) ($)
|
|
Exercisable
|
|
Unexercisable
(1)
|
|
|
|
|
Marc A. Cohen
|
|
41,676
|
|
|
|
12.00
|
|
6/29/10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,324
|
|
|
|
13.20
|
|
6/29/10
|
|
|
|
|
|
|
100,000
|
|
|
|
10.59
|
|
7/24/11
|
|
|
|
|
|
|
50,000
|
|
|
|
5.85
|
|
8/8/12
|
|
|
|
|
|
|
48,000
|
|
|
|
11.75
|
|
10/22/13
|
|
15,080
|
|
122,751
|
|
|
|
|
|
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Alain J. Cohen
|
|
41,676
|
|
|
|
12.00
|
|
6/29/10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,324
|
|
|
|
13.20
|
|
6/29/10
|
|
15,080
|
|
122,751
|
|
|
|
|
|
|
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Mel F. Wesley
|
|
7,500
|
|
2,500
|
|
11.56
|
|
7/8/14
|
|
17,679
|
|
143,907
|
(1)
|
Unexercised option grants vest evenly on an annual basis over the last three years of the vesting schedule of the particular grant.
|
(2)
|
These restricted stock grants were granted pursuant to our 2000 Incentive Plan and vest evenly on an annual basis over four years, starting on the second
anniversary of the grant date. Marc A. Cohens restricted stock grants: (i) 5,340 shares granted February 6, 2006, (ii) 2,696 shares granted May 22, 2006, (iii) 2,145 shares
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12
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granted August 7, 2006, (iv) 1,956 shares granted November 3, 2006, (v) 1,956 shares granted February 22, 2007, (vi) 2,773
shares granted May 31, 2007, and (vii) 1,774 shares granted February 6, 2008.
|
Alain J. Cohens
restricted stock grants: (i) 5,340 shares granted February 6, 2006, (ii) 2,696 shares granted May 22, 2006, (iii) 2,145 shares granted August 7, 2006, (iv) 1,956 shares granted November 3, 2006, (v) 1,956
shares granted February 22, 2007, (vi) 2,773 shares granted May 31, 2007, and (vii) 1,774 shares granted February 6, 2008.
Mel F. Wesleys restricted stock grants: (i) 8,657 shares granted February 6, 2006, (ii) 647 shares granted May 22, 2006, (iii) 686 shares granted August 7, 2006, (iv) 626 shares granted
November 3, 2006, (v) 470 shares granted February 22, 2007, (vi) 555 shares granted May 31, 2007, (vii) 3,064 shares granted August 3, 2007, (viii) 497 shares granted February 6, 2008, and (ix) 5,747
shares granted February 6, 2008.
(3)
|
Based on a value of $8.14 per share, the closing price of our Common Stock as reported on the Nasdaq Global Market on March 31, 2008, the last trading day during fiscal 2008.
|
Option Exercises and Vested Stock
The following table summarizes the vesting of stock awards for each of our executive officers for the fiscal year ended March 31, 2008. None of our
executives exercised stock options during fiscal 2008.
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|
|
|
|
|
|
Stock Awards
|
Name
|
|
Number of
Shares
Acquired
on Vesting
|
|
Value Realized
on Vesting
($) (1)
|
Marc A. Cohen
|
|
1,780
|
|
15,486
|
Alain J. Cohen
|
|
1,780
|
|
15,486
|
Mel F. Wesley
|
|
2,885
|
|
25,100
|
(1)
|
Based on the closing price of our Common Stock on the Nasdaq Global Market on the vesting date or, if the vesting date was not a trading date, on the last trading date prior
thereto.
|
Employment Agreements
None of our executive officers have employment agreements with us.
Marc Cohen and Alain Cohen each entered
into a non-compete agreement with us on September 30, 1997. Under the agreements, Marc Cohen and Alain Cohen each agreed not to compete with us during the term of his employment and, in the event that his employment with us is terminated either
at his voluntary election or by us for good cause, for a period of 12 months thereafter. In addition, Marc Cohen and Alain Cohen each agreed not to solicit our employees or customers on behalf of any competitor during the same period. Further, Marc
Cohen and Alain Cohen each agreed to protect our confidential information during his employment, except as appropriate in the performance of his duties, and after the termination of his employment.
We have also entered into a nondisclosure, non-compete, nonsolicitation and ownership of inventions agreement with Mr. Wesley, under which he has
agreed to protect our confidential information during and after the termination of his employment, and not to compete with us during the term of his employment and for 12 months after termination of his employment, regardless of the cause.
Potential Payments Upon Termination or Change of Control
None of our executives have any arrangement that provides for severance payments. None of our executives is entitled to payment of any benefits upon a
change in control of our company, except that any unused vacation balance is paid out and our 2000 Incentive Plan provides that in connection with a change in control, all unvested stock options and restricted stock will become fully vested.
13
The following table sets forth information regarding the executive equity awards that would fully vest,
if a change in control were triggered at March 31, 2008.
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|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
Stock Awards
|
Name
|
|
Number of
Securities
Acquired
on Exercise
|
|
Value Realized
on Exercise
($)
|
|
|
Number of
Shares
Acquired
on Vesting
|
|
Value Realized
on Vesting
($)
|
Marc A. Cohen
|
|
|
|
|
|
|
|
16,860
|
|
137,240
|
Alain J. Cohen
|
|
|
|
|
|
|
|
16,860
|
|
137,240
|
Mel F. Wesley
|
|
2,500
|
|
$
|
0
|
(1)
|
|
18,064
|
|
147,041
|
(1)
|
The exercise price of these options is greater than the $8.14 closing price of our Common Stock as reported on the Nasdaq Global market on March 31, 2008, the last day of
trading during fiscal 2008; therefore, the value realized on exercise would be $0.00.
|
Compensation of Directors
Directors are reimbursed for reasonable out-of-pocket expenses incurred in attending Board and Board committee meetings. We pay non-employee directors an
annual retainer of $20,000 and a fee of $1,000 per day for attending Board or Board Committee meetings in person or by telephone. No director who is also an employee receives separate compensation for services rendered as a director.
Prior to May 9, 2007, our non-employee directors received automatic annual grants of stock options pursuant to our 2000 Director Stock Option Plan
(the Director Plan). Each non-employee director was granted an option to purchase 10,000 shares of Common Stock on the date of each annual meeting of stockholders, provided that he was serving as a director immediately following such
annual meeting of stockholders. On May 9, 2007, we terminated the automatic annual grants of stock options under the Director Plan and adopted a policy that each non-employee director will instead receive an annual grant of 3,000 restricted
shares of Common Stock under our 2000 Incentive Plan. The restricted shares of Common Stock will be granted on the date of the annual meeting of stockholders to each of our non-employee directors who is serving as a director immediately after that
meeting, and shall be fully vested on the date of the next annual meeting of stockholders, provided he is serving as a director immediately prior to such meeting. On July 25, 2007, we suspended all option grants under the Director Plan. In
addition, we adopted a policy that each person who becomes a non-employee director other than pursuant to election at an annual meeting of stockholders will be granted a number of restricted shares of Common Stock on the date of his election to the
Board of Directors calculated by multiplying 250 by the number of full calendar months remaining from the date of his initial election to the Board of Directors until the first anniversary of the prior years annual meeting of stockholders.
Director Compensation Table
The following table sets forth information regarding the compensation of our directors for fiscal 2008. Our executive officers who also served as directors are not included in this table because they were not
separately compensated for their service as directors.
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|
|
|
|
|
|
|
|
Director
|
|
Fees Earned or
Paid in Cash
($)
|
|
Stock
Awards
(1) ($)
|
|
Grant Date
Fair Value
($/sh)
|
|
Total
($)
|
Steven G. Finn
|
|
28,000
|
|
33,270
|
|
11.09
|
|
61,270
|
Ronald W. Kaiser
|
|
26,000
|
|
33,270
|
|
11.09
|
|
59,270
|
William F. Stasior
|
|
28,000
|
|
33,270
|
|
11.09
|
|
61,270
|
(1)
|
We granted 3,000 shares of restricted stock to each of our directors on September 12, 2007. The September 12, 2007 restricted stock grant was the only
grant made to the directors during their entire term of service. This column reflects the amount we recorded as stock-based compensation in our financial
|
14
|
statements for the respective fiscal year in connection with restricted stock and stock option grants. The assumptions we used in determining stock based
compensation are described under the caption Stock-Based Compensation in Note 2 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended March 31, 2008 filed with the SEC. Unlike the
amount reflected in our consolidated financial statements, however, the amounts shown above do not reflect any estimate of forfeitures related to service-based vesting. Instead, it assumes that the director will perform the requisite service to vest
in the award. service to vest in the award.
|
(2)
|
The table below shows the aggregate numbers of stock awards and option awards outstanding for each non-employee director as of March 31, 2008.
|
|
|
|
|
|
Director
|
|
Number
of Stock Awards
Outstanding as
of March 31,
2008
|
|
Number
of Option Awards
Outstanding as of
March 31, 2008
|
Steven G. Finn
|
|
3,000
|
|
90,000
|
Ronald W. Kaiser
|
|
3,000
|
|
45,000
|
William F. Stasior
|
|
3,000
|
|
90,000
|
Compensation Committee Interlocks and Insider Participation
The current members of the Compensation Committee are Mr. Finn, Chairman, and Messrs. Kaiser and Stasior. None of our executive officers have served
as a director or member of the compensation committee (or other committee serving an equivalent function) of any other entity, one of whose executive officers served as our director or a member of our Compensation Committee.
Report of the Audit Committee of the Board of Directors
The Audit Committee reviewed the Companys audited financial statements for fiscal 2008 and discussed these financial statements with the Companys management. The Audit Committee also reviewed and discussed the audited financial
statements and the matters required by Statement on Auditing Standards No. 114 (The Auditors Communication With Those Charged With Governance) with Deloitte & Touche LLP, the Companys independent registered public
accounting firm.
The Companys independent registered public accounting firm also provided the Audit Committee with the written
disclosures and the letter required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees). The Audit Committee discussed with the independent registered public accounting firm the matters disclosed in
this letter and their independence from the Company. The Audit Committee also considered whether the independent registered public accounting firm provision of the other, non-audit related services to the Company which are referred to under the
heading Independent Auditor Fees and Related Matters is compatible with maintaining such auditors independence.
Based on
its discussions with management and the independent registered public accounting firm, and its review of the representations and information provided by management and the independent auditors, the Audit Committee recommended to the Companys
Board of Directors that the audited financial statements be included in the Companys Annual Report on Form 10-K for the year ended March 31, 2008.
By the Audit Committee of the Board of Directors.
Steven G. Finn,
Ronald W. Kaiser
William F.
Stasior
15
Independent Registered Public Accounting Firm Fees and Other Matters
The following table sets forth aggregate fees billed by our Independent Registered Public Accounting firm, Deloitte & Touche LLP, the member
firms of Deloitte Touche Tohmatsu, and their respective affiliates (collectively, Deloitte), for fiscal 2008 and fiscal 2007.
|
|
|
|
|
|
|
Fiscal 2008
($)
|
|
Fiscal 2007
($)
|
Audit Fees (1)
|
|
1,239,000
|
|
938,000
|
Audit-Related Fees
|
|
|
|
|
Tax Compliance Fees (2)
|
|
258,000
|
|
216,000
|
Tax Advisory Fees (3)
|
|
162,000
|
|
104,000
|
All Other Fees
|
|
|
|
|
|
|
|
|
|
Total Fees
|
|
1,659,000
|
|
1,258,000
|
|
|
|
|
|
(1)
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Audit fees include professional services rendered for the audit of our annual financial statements, reviews of our quarterly financial statements, international statutory audits,
and other fees related to our SEC filings and other accounting consultations.
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(2)
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Tax compliance fees include services related to the preparation of the U.S. federal tax returns, tax returns in overseas countries in which we do business and various state and
local tax returns.
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(3)
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Tax advisor fees include services related to tax examination assistance, tax research and tax planning services in the countries in which we do business.
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The Audit Committee of the Board of Directors has considered whether the provision by Deloitte of the non-audit services listed above is compatible
with maintaining Deloittes independence. The Audit Committee has determined that the rendering of the services other than audit services by Deloitte is compatible with maintaining the principal accountants independence.
All services and fees described above were approved by the Audit Committee.
Pre-Approval Policies and Procedures
The Audit Committees policy is to pre-approve all audit
and permissible non-audit services provided by the independent auditors. These services may include audit services, audit-related services, tax services and other services. Pre-approval is generally provided for up to one year and any pre-approval
is detailed as to the particular service or category of services, and may be subject to a specific budget. The independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided
by the independent auditors in accordance with this pre-approval policy, and the related amounts of fees for services performed. The Audit Committee may also pre-approve particular services on a case-by-case basis.
CERTAIN TRANSACTIONS
TRANSACTIONS
WITH RELATED PERSONS
Related-Person Transactions Policy and Procedures
In September 2004, our Audit Committee adopted a written Related Person Transactions Policy which requires the Audit Committee to review all related party
transactions (defined as transactions required to be disclosed pursuant to Item 404 of Regulation S-K of the Securities Act of 1933) on an ongoing basis, and all such transactions must be approved by the Audit Committee. Since January 2006, our
policy requires that each fiscal quarter we obtain a list of stockholders with an interest of 5% or greater in the Company and determine whether we have had any transactions with anyone on the list. We also consult with each member of the Board of
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Directors each fiscal quarter to determine if there have been any related person transactions or whether any related-person transactions are currently
pending.
Related-Person Transactions
During the fiscal year ended March 31, 2008, we were not a participant in any transaction with a related person in which the amount involved exceeded $120,000 and in which the related person had or will have a direct or indirect
material interest.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Companys directors, executive officers and holders of more than 10% of the Common Stock
(Reporting Persons) to file with the SEC initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Based solely on its review of copies of reports filed by the Reporting
Persons furnished to the Company and on the representations of the Reporting Persons, the Company believes that during the year ended March 31, 2008 the Reporting Persons complied with all Section 16(a) filing requirements.
OTHER MATTERS
The Board of Directors
does not know of any other matters that may come before the Annual Meeting. However, if any other matters are properly presented at the Annual Meeting, it is the intention of the persons named in the accompanying proxy to vote, or otherwise act, in
accordance with their judgment on such matters.
The Company will bear all costs of soliciting proxies. In addition to solicitations by
Internet, and mail, the Companys directors, officers and regular employees may, without additional remuneration, solicit proxies by telephone, facsimile and personal interviews, and the Company reserves the right to retain outside agencies for
the purpose of soliciting proxies. The Company will also request brokers, custodians and fiduciaries to forward the proxy soliciting material to the owners of stock held in their names, and, as required by law, the Company will reimburse them for
their out-of-pocket expenses in this regard.
STOCKHOLDER PROPOSALS FOR 2009 ANNUAL MEETING
To be considered for inclusion in the proxy statement for the 2009 Annual Meeting, stockholder proposals must be submitted to the Secretary of the
Company at its principal executive offices at 7255 Woodmont Avenue, Bethesda, Maryland 20814, no later than the close of business on March 27, 2009.
If a stockholder of the Company wishes to present a proposal directly at the 2009 Annual Meeting,
but does not wish to have the proposal considered for inclusion in the proxy statement, such stockholder must also give written notice to the Secretary of the Company at the address noted above. The Secretary must receive such notice not less than
60 days nor more than 90 days prior to the first anniversary of the 2008 Annual Meeting; provided that, in the event that the date of the 2009 Annual Meeting is advanced by more than 20 days, or delayed by more than 60 days, from the first
anniversary of the 2008 Annual Meeting, notice by the stockholder must be received not earlier than the 90
th
day prior to the 2009 Annual Meeting
and not later than the close of business on the later of (i) the 60
th
day prior to the 2009 Annual Meeting and (ii) the 10th day following
the date on which such notice of the date of the meeting was mailed or such public disclosure was made, whichever occurs first. If a stockholder fails to provide timely notice of a proposal to be presented at the 2009 Annual Meeting, the proxies
designated by the Board of Directors of the Company will have discretionary authority to vote on any such proposal. The Company reserves the right to reject, rule out of order, or take other appropriate action with respect to any proposal that does
not comply with these and other applicable requirements.
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Stockholders wishing to propose director
candidates for consideration by the stockholders at the 2009 annual meeting of stockholders may do so by writing to the Secretary of the Company and providing the information specified in the Companys Bylaws, including the candidates
name, address and principal occupation. The Companys Bylaws set forth further requirements for stockholders wishing to nominate director candidates for consideration by stockholders including, among other things, that a stockholder must give
written notice of an intent to make such a nomination complying with the Bylaws of the Company to the Secretary of the Company received not less than 60 days nor more than 90 days prior to the first anniversary of the 2008 Annual Meeting; provided
that, in the event that the date of the 2008 Annual Meeting is advanced by more than 20 days, or delayed by more than 60 days, from the first anniversary of the 2008 Annual Meeting, notice by the stockholder must be received not earlier than the 90
th
day prior to the 2009 Annual Meeting and not later than the close of business on the later of (i) the 60
th
day prior to the 2009 Annual Meeting and (ii) the 10th day following the date on which such notice of the date of the meeting was mailed or such public disclosure was made,
whichever occurs first.
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By Order of the Board of Directors,
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/s/ M
ARC
A.
C
OHEN
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Marc A. Cohen
Chairman of the Board, Chief
Executive Officer and Secretary
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Bethesda, Maryland
July 25, 2008
A
COPY OF THE COMPANYS FORM 10-K REPORT FOR FISCAL YEAR 2008, CONTAINING CONSOLIDATED FINANCIAL STATEMENTS AND OTHER INFORMATION OF INTEREST TO STOCKHOLDERS, IS AVAILABLE UPON REQUEST WITHOUT CHARGE. PLEASE CONTACT:
Investor Relations
OPNET
Technologies, Inc.
7255 Woodmont Avenue
Bethesda, Maryland 20814
THE BOARD OF DIRECTORS HOPES THAT STOCKHOLDERS WILL ATTEND THE ANNUAL MEETING. WHETHER OR
NOT YOU EXPECT TO ATTEND THE MEETING, YOU MAY VOTE YOUR SHARES EITHER: (I) OVER THE INTERNET AS INSTRUCTED IN THESE MATERIALS; OR (II) IF YOU RECEIVED A PAPER COPY OF THESE MATERIALS, BY SIGNING, DATING AND RETURNING THE PROXY CARD AS
PROMPTLY AS POSSIBLE IN ORDER TO ENSURE YOUR REPRESENTATION AT THE MEETING. IF YOU ARE RECEIVING THESE PROXY MATERIALS BY MAIL, A RETURN ENVELOPE (WHICH IS POSTAGE PREPAID IF MAILED IN THE UNITED STATES) IS ENCLOSED FOR YOUR CONVENIENCE.
STOCKHOLDERS WHO EXECUTE A PROXY CARD OR VOTE ON THE INTERNET MAY NEVERTHELESS ATTEND THE ANNUAL MEETING, REVOKE THEIR PROXY AND VOTE THEIR SHARES IN PERSON.
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AMERICAN STOCK TRANSFER
C/O OPNET TECHNOLOGIES, INC.
6201 15
TH
AVENUE, 3RD FLOOR
BROOKLYN, NY 11219
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VOTE BY INTERNET -
www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and
follow the instructions to obtain your records and to create an electronic voting instruction form.
ELECTRONIC DELIVERY OF FUTURE STOCKHOLDER COMMUNICATIONS
If you would like to reduce the costs incurred by OPNET
Technologies, Inc. in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions
above to vote using the Internet and, when prompted, indicate that you agree to receive or access stockholder communications electronically in future years.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the
postage-paid envelope we have provided or return it to OPNET Technologies, Inc., c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
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TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
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OPNET1
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KEEP THIS PORTION FOR YOUR RECORDS
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DETACH AND RETURN THIS PORTION ONLY
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THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
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OPNET TECHNOLOGIES, INC.
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For
All
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Withhold
All
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For All
Except
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To withhold
authority to vote for any individual
nominee, mark For All Except and write the
number of the nominee on the line below.
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The Board of Directors recommends a
vote FOR the election of the director
nominees.
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Vote on Directors
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¨
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¨
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¨
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Proposal 1. Election of two Class II Directors for a three-year term extending until the 2011 Annual Meeting of Stockholders
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Nominees:
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01) Alain J. Cohen
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02) Steven G. Finn
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For address changes and/or comments, please check this box and write them on the back where indicated.
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¨
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Signature [PLEASE SIGN WITHIN BOX]
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Date
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Signature (Joint Owners)
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Date
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PROXY
OPNET TECHNOLOGIES, INC.
Proxy for the Annual Meeting of Stockholders to be held Tuesday,
September 9, 2008
This Proxy is Solicited on Behalf of the Board of Directors of the Company.
The undersigned, having received notice of the meeting and the Board of Directors
proxy statement therefor, and revoking all prior proxies, hereby appoints Marc A. Cohen, Mel F. Wesley, and Dennis R. McCoy, and each of them, with full power of substitution, as proxies to represent and to vote, as designated herein, all shares of
stock of OPNET Technologies, Inc. (the Company) that the undersigned would be entitled to vote if personally present at the Annual Meeting of Stockholders of the Company to be held at the principal executive office of the Company, 7255
Woodmont Avenue, Bethesda, Maryland 20814, on Tuesday, September 9, 2008, at 10:00 a.m., local time, and at any adjournment thereof (the Meeting). The matter set forth on the reverse side has been proposed by the Company.
This proxy, when properly executed, will be voted in the manner directed herein by the
undersigned stockholder. If no direction is given, this proxy will be voted FOR the election of the director nominees listed in Proposal 1. In their discretion, the proxies are authorized to vote on any other business as may properly come before the
meeting or any adjournment or postponement thereof. Attendance of the undersigned at the meeting or at any adjournment thereof will not be deemed to revoke this proxy
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Address changes/comments:
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(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)
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(CONTINUED AND TO BE SIGNED ON THE REVERSE
SIDE)
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OPNET TECHNOLOGIES, INC.
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** IMPORTANT NOTICE **
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Regarding the Availability of Proxy Materials for the Stockholder Meeting to be held on
9/9/08
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You are receiving this communication because you hold
shares in the above company, and the materials you should review before you cast your vote are now available.
This communication presents only an overview of the more complete proxy materials that are available to you on the Internet. We encourage you to access and review all of the important information contained in the
proxy materials before voting.
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Proxy Materials
Available
Notice and Proxy Statement
Annual Report
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PROXY MATERIALS - VIEW OR RECEIVE
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AMERICAN STOCK TRANSFER
C/O OPNET TECHNOLOGIES, INC.
6201 15TH AVENUE, 3RD FLOOR
BROOKLYN, NY 11219
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You can
choose to view the materials online or receive a paper or e-mail copy. There is NO charge for requesting a copy. Requests, instructions and other inquiries will NOT be forwarded to your investment advisor.
To facilitate timely delivery please make the request as instructed below on or before
8/26/08.
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HOW TO VIEW MATERIALS VIA THE INTERNET
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Have the 12 Digit Control Number(s) available and visit: www.proxyvote.com
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HOW TO REQUEST A COPY OF MATERIALS
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1) BY INTERNET
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www.proxyvote.com
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2) BY TELEPHONE
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1-800-579-1639
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3) BY E-MAIL*
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sendmaterial@proxyvote.com
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*If requesting materials by e-mail, please send a blank
e-mail with the 12 Digit Control Number (located on the following page) in the subject line.
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See the Reverse Side for Meeting Information and Instructions on How to Vote
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Meeting Information
Meeting Type: Annual
Meeting Date: 9/9/08
Meeting
Time: 10:00 a.m. EDT
For holders as of: 7/21/08
Meeting Location:
OPNET Technologies, Inc.
7255 Woodmont Avenue
Bethesda, MD 20814
Meeting Directions:
For Meeting
Directions Please Access: http://www.opnet.com/corporate/directions/ opnet_offices_united_states/hq/index.html
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How To
Vote
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Vote In Person
Many stockholder meetings have attendance requirements including, but not limited to, the possession of an attendance ticket issued by the entity holding the meeting.
Please check the meeting materials for any special requirements for meeting attendance. At the Meeting you will need to request a ballot to vote these shares.
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Vote By Internet
To vote
now
by Internet, go to
WWW.PROXYVOTE.COM.
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your notice in hand when you
access the web site and follow the instructions.
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The Board of Directors recommends a vote FOR the election of the director nominees listed below.
1.
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Election of two Class II directors for a three-year term extending until the 2011 Annual Meeting of Stockholders.
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Nominees:
2.
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In their discretion, upon such other business, if any, as may properly come before the Annual Meeting or any adjournments thereof.
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