SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities 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 ss.240.14a-11(c) or ss.240.14a-12
Sawtek Inc.
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] 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 fee 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: ______________________
<PAGE>
SAWTEK INC.
1818 S. Highway 441
Apopka, Florida 32703
Notice of Annual Meeting of Shareholders and Proxy Statement
Steven P. Miller
Chairman, President and
Chief Executive Officer
December 10, 1996
Dear Shareholder:
You are cordially invited to attend the 1997 Annual Meeting of Shareholders. The
meeting will be held at the corporate offices of Sawtek Inc., 1818 South Highway
441, Apopka, Florida, on Monday, January 20, 1997, starting at 10:00 a.m.
The notice of the meeting and the proxy statement on the following pages cover
the formal business of the meeting, which includes the election of the
directors.
Following the business session, I will report on current operations and our
plans. Following these reports there will be an open discussion period during
which your questions and comments will be welcome.
We hope you will be able to join us.
Cordially,
/s/Steven P. Miller
<PAGE>
SAWTEK INC.
1818 S. Highway 441
Apopka, Florida 32703
Notice of Annual Meeting of Shareholders
TO THE HOLDERS OF COMMON STOCK OF
SAWTEK INC.
The Annual Meeting of the Shareholders of Sawtek Inc. will be held at the
corporate offices of Sawtek Inc., 1818 S. Highway 441, Apopka, Florida 32703, on
Monday, January 20, 1997, starting at 10:00 a.m. for the following purposes:
1. To elect directors.
2. To transact such other business as may properly come before the meeting.
Holders of Common Stock of record at the close of business on December 9,
1996 will be entitled to vote at the meeting.
By order of the Board of Directors
WILLIAM A. GRIMM
Secretary
Apopka, Florida
December 10, 1996
IMPORTANT NOTICE
To assure your representation at the meeting, please complete,
date, sign, and mail promptly the enclosed proxy for which
a return envelope is provided
<PAGE>
SAWTEK INC.
1818 S. Highway 441
Apopka, Florida 32703
Notice of Annual Meeting of Shareholders
to be held January 20, 1997
General Information
- -------------------
The accompanying proxy is solicited by the Board of Directors of the Company. A
shareholder may revoke his proxy at any time prior to the time it is voted at
the meeting by filing with the Secretary of the Company a written notice of
revocation, by duly executing and delivering a subsequent proxy bearing a later
date, or by attending the meeting and voting in person.
The record date for shareholders entitled to vote at the meeting is December 9,
1996.
The Company has only one class of outstanding shares, namely Common Stock, par
value $.0005 per share, of which there were 20,144,772 shares outstanding on the
record date and 96 holders of record. Each share is entitled to one vote.
The shares represented by each valid proxy will be voted at the meeting or any
adjournment thereof, and, if a choice is specified in the proxy, the shares will
be voted in accordance with such specification. If no vote is specified, the
shares will be voted as set forth in the accompanying proxy. The election of
directors requires a majority of the votes cast. With respect to abstentions,
shares are considered present at the meeting for a particular proposal, but
since they are not affirmative votes for the proposal, they will have the same
effect as votes against the proposal. With respect to shares held in brokerage
accounts, shares which are not voted by the broker are not considered present at
the meeting for the particular proposal.
So far as the directors of the Company are aware, no matters will be presented
to the meeting for action on the part of the shareholders other than the
election of the directors. If any other matter is properly brought before the
meeting, it is the intention of the persons named in the proxy to vote the
shares to which the proxy relates in accordance with their best judgment.
The cost of soliciting proxies will be borne by the Company. Officers and
employees may, by letter, telephone, or in person, make additional requests for
the return of proxies. The Company will reimburse brokerage houses, custodians,
nominees and others for their out-of-pocket expenses incurred in connection with
such solicitation. The Company also has retained ADP Corporation to aid in the
solicitation of proxies at an estimated fee of $3,000. This Proxy Statement, the
accompanying proxy and a copy of the Company's Annual Report for the year ended
September 30, 1996, are being mailed to shareholders commencing on December 10,
1996.
1
<PAGE>
Election of Directors
- ---------------------
All of the members of the Company's Board of Directors are elected annually at
the Annual Meeting of Shareholders. The five members are Steven P. Miller, Neal
J. Tolar, Robert C. Strandberg, Bruce S. White, and Willis C. Young, and each of
them are standing for re-election. In accordance with the Bylaws of Sawtek Inc.,
all directors hold office until the next Annual Meeting and until his or her
successor shall be elected and shall qualify, subject, however, to prior death,
resignation, retirement, disqualification or removal from office.
Vacancies may be filled by the remaining directors.
The authorized number of directors is presently set at five. From time to time,
the Board considers potential candidates, and as an appropriate candidate is
identified the Board will consider increasing the number of directors.
The persons named in the accompanying proxy will vote in favor of electing the
nominees to serve for the terms identified above, unless otherwise specified in
the proxy. If any nominee shall become unavailable for election, the proxies
will be voted for the election of such persons, if any, as shall be designated
by the Board of Directors.
None of the nominees nor any of the incumbent directors is related to any other
nominee or director or to any executive officer of the Company or its
subsidiaries by blood, marriage or adoption.
Biographical summaries of the nominees and of the continuing directors appear on
the following pages and data with respect to the number of shares of the
Company's Common Stock beneficially owned by them as of October 31, 1996 are set
forth in the table on page 10.
2
<PAGE>
Board of Directors
- ------------------
Steven P. Miller
- ----------------
Mr. Miller, 48, co-founded the Company and has served as president and a
director since 1979, chief executive officer since 1986 and chairman since
February 1996. Prior to joining the Company, he was manager of the SAW Device
Engineering and Development Laboratory at Texas Instruments Incorporated ("TI"),
an electronics manufacturer. He joined TI in 1969. Mr. Miller has a B.S. degree
in Electrical Engineering from the South Dakota School of Mines and Technology.
Neal J. Tolar
- -------------
Dr. Tolar, 55, co-founded the Company and has served as senior vice
president and chief technical officer since June 1995 and a director since 1979.
He served as vice president, Operations and Engineering from 1979 to June 1995.
Prior to joining the Company, he was a member of the technical staff in the RF
Technology Group of the Corporate Research Laboratory at TI. He joined TI in
1967. Dr. Tolar has a Ph.D. in Ceramic Engineering from the University of Utah
and a B.S. degree in Ceramic Engineering from Mississippi State University.
Robert C. Strandberg
- --------------------
Mr. Strandberg, 39, has been a director since October 1995. Mr. Strandberg
was the chairman of the Board of Directors, president and chief executive
officer of Datamax International Corporation, a manufacturer of bar code
printers, from September 1991 to April 1996. He is currently self-employed as a
management consultant. From 1988 to 1991, he was vice president, Finance, of
Datamax. From 1986 to 1988, he worked for GTECH, a lottery management company,
in the areas of finance and strategic planning. Mr. Strandberg has an M.B.A.
degree from Harvard Graduate School of Business Administration and a B.S. degree
in Operations Research and Industrial Engineering from Cornell University.
Bruce S. White
- --------------
Mr. White, 63, has been a director since April 1996. Mr. White has been
a corporate vice president of AVNET Inc., a distributor of electronic
components, since January 1996 and the president of the Penstock Division of
AVNET Inc. since July 1994. From 1974 to July 1994, Mr. White was the president
and chief executive officer of Penstock Inc., a company he founded to distribute
RF and microwave components. Penstock is a distributor of certain products
manufactured by Sawtek. In fiscal 1996, sales from Sawtek to Penstock were
approximately $1.9 million. Mr. White has a B.A. degree in Mathematics from
Colgate University and B.S. and M.S. degrees in Electrical Engineering from
Michigan State University.
3
<PAGE>
Willis C. Young
- ---------------
Mr. Young, 55, has been a director since February 1996. He has been a
senior partner at the Atlanta office of BDO Seidman, LLP, an international
accounting and consulting firm, since January 1996. From April 1995 to December
1995, Mr. Young was the chief financial officer for Hayes Microcomputer
Products, Inc., a manufacturer of modems and communication equipment, where he
was engaged to assist in the implementation of Hayes' restructuring in
bankruptcy. From 1965 to March 1995, Mr. Young held various positions with BDO
Seidman, LLP, and from 1988 to March 1995 he was a vice chairman and a member of
the Executive Committee. Mr. Young has a B.S. degree in Accounting from Ferris
State University. He is a Certified Public Accountant.
Information on Board of Directors and Committees
- ------------------------------------------------
Meetings and Attendance
- -----------------------
During the year, there were eight meetings of the Board of Directors and three
meetings of the standing committees of the Board. All directors attended more
than 75 percent of the aggregate of all meetings of the Board and the Board
committees on which they served.
Committees of the Board
- -----------------------
The Board has established two committees to assist in the discharge of its
responsibilities, the principal functions of each committee are described below.
In addition, the Board as a whole serves as the Nominating Committee.
The Audit Committee assists the Board in ensuring that the Company's financial
auditing and reporting practices, procedures and controls are within acceptable
limits of sound practice and in accordance with applicable laws and regulations.
The Committee meets periodically with the independent auditors, together with
representatives of management, as appropriate, for the purpose of reviewing the
scope and results of the annual audit of the financial statements and the
recommendations of the auditors. The Committee also reviews the nature and
extent of non-audit professional services performed by the auditors. The
Committee held three meetings during the past 12 months. The members of the
Committee are Messrs. Young (Chairman), Tolar and Strandberg.
The Compensation Committee assists the Board in reviewing the annual
compensation and bonuses paid to the executive officers. The Committee held two
meetings during the past 12 months. The members of the Committee are Messrs.
Strandberg (Chairman), White and Young.
4
<PAGE>
Directors' Compensation
- -----------------------
Each of the three non-employee directors currently receive an annual retainer
fee of $8,000.
Messrs. Strandberg, White and Young each hold options to purchase 20,000 shares
of the Company's Common Stock. The options are non-statutory options and are
priced at the fair market value on the date of grant. One-third of the option
shares become exercisable on the anniversary of the date of grant and one-third
on each of the two succeeding anniversary dates. The option term is ten years.
Report on Executive Compensation
- --------------------------------
The Compensation Committee was formed prior to the Company's initial public
offering. For the fiscal year ended September 30, 1996, the Compensation
Committee approved the bonuses paid to several levels of management including
the CEO and the other executive officers. The base compensation for the
executive officers and other management employees had been set and approved by
the Company's Board of Directors early in the fiscal year after reviewing the
salary levels of comparable executives reported by the American Electronics
Association. The bonuses paid to Mr. Miller and Dr. Tolar reflected the doubling
of the Company's net after tax earnings (before adjustment for the ESOP charge)
and the tax savings which the Company experienced as a result of the exercise of
certain non-qualified stock options by Mr. Miller and Dr. Tolar. The
Compensation Committee intends to utilize the comparable compensation levels
reported by the American Electronics Association as a guideline for base
compensation for the executive officers in the future. Bonuses, if any, for
fiscal year 1997, will be based on the level of pre-tax income for the Company
and other factors to be developed by the Compensation Committee.
- - Robert C. Strandberg - Chairman
- - Willis C. Young
- - Bruce S. White
Selection of Auditors
- ---------------------
Representatives of Ernst & Young LLP, independent auditors, who audited the
books of the Company for the year ended September 30, 1996, are expected to be
present at the shareholders' meeting to make a statement if they so desire and
to be available to respond to appropriate questions of shareholders. The Company
has not reviewed fees and other arrangements for auditing services, and
accordingly has not selected the auditors for the year ending September 30,
1997.
Shareholder Proposals for the 1998 Annual Meeting
- -------------------------------------------------
Shareholder proposals intended to be presented at the 1998 Annual Meeting of
Shareholders and to be included in the Company's proxy statement and form of
proxy for that meeting must be received by the Company not later than August 15,
1997.
5
<PAGE>
Performance Graph
- -----------------
The graph below compares the performance of the Company's Common Stock with the
performance of the NASDAQ composite index and the Hambrecht & Quist
communication sector component of its Growth and Technology Index. The
comparison of total return on investment for the period assumes that $100 was
invested on May 1, 1996 in the Company and each of the indices.
Comparison of Total Return Among NASDAQ Composite Index and the
H&Q Communication Sector of its Growth and Technology Index and Sawtek Inc.
---------------------------------------------------------------------------
Period Value (1) % Growth Rate
---------------- -------------
Sawtek $200 100%
NASDAQ Composite with dividends re-invested $103 3.43%
Hambrecht & Quist Communications Sector Index $101 1.16%
1) Growth of $100 invested in each item from May 1, 1996 (date of Sawtek's IPO)
to September 30, 1996.
6
<PAGE>
Summary Compensation Table
- --------------------------
The table below illustrates annual and long-term compensation for services to
the Company for the years ending September 30, 1996, 1995 and 1994 for those
executives who, as of September 30, 1996 were (i) the Chief Executive Officer
and (ii) the other four most highly-compensated executives of the Company.
<TABLE>
<CAPTION>
Other Total Option
Name and Position Year Salary Bonus Compensation (2) Grants #(1)
----------------- ---- ------ ----- ---------------- -----------
<S> <C> <C> <C> <C> <C>
Steven P. Miller 1996 $199,992 $714,274 $48,521 -
Chairman, President & 1995 158,184 239,341 22,817 -
Chief Executive Officer 1994 153,284 509,598 21,184 330,000
Neal J. Tolar 1996 167,003 692,831 39,594 -
Senior Vice President & 1995 146,037 220,041 22,964 -
Chief Technical Officer 1994 142,772 470,461 21,651 330,000
Gary A. Monetti 1996 109,990 73,098 27,759 -
Vice President - Operations 1995 97,565 111,438 14,398 -
& Chief Operating Officer 1994 91,559 221,579 24,032 67,980
Thomas L. Shoquist 1996 113,526 58,367 27,349 -
Vice President - Quality 1995 106,850 102,533 16,210 -
1994 102,635 248,305 24,416 -
Raymond A. Link 1996 106,194 74,683 15,097 60,000
Vice President - Finance 1995 * * * 100,000
Chief Financial Officer 1994 * * * *
<FN>
* Mr. Link joined the Company in Fiscal 1995 and earned less than $100,000 in Fiscal
1995.
(1) Amounts shown represent the number of shares subject to non-qualified
stock options granted each year.
(2) The amounts reported include the following:
</FN>
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
Contributions to the
Employee Stock
Ownership Plan
----------------------- Taxable Portion Premiums for Estate and Tax
Name Year # of Shares Cost Basis of Life Insurance Disability Insurance Planning Services
---- --- ----------- ---------- ----------------- -------------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Steven P. Miller 1996 19,771 $20,329 $1,218 $2,245 $24,729
1995 32,048 14,421 1,218 3,363 3,815
1994 45,015 20,257 927 - -
Neal J. Tolar 1996 19,771 20,329 2,556 - 16,709
1995 32,048 14,421 1,636 6,542 365
1994 45,015 20,257 1,394 - -
Gary A. Monetti 1996 19,771 20,329 224 - 7,206
1995 31,498 14,174 224 - -
1994 52,990 23,846 186 - -
Thomas L. Shoquist 1996 19,771 20,329 1,020 - 6,000
1995 34,654 15,594 616 - -
1994 52,990 23,846 570 - -
Raymond A. Link 1996 14,360 14,765 332 - -
</TABLE>
8
<PAGE>
<TABLE>
Option Grants in FY96:
- ----------------------
<CAPTION>
Potential Realizable Value at
Market Price Assumed Rate of Stock Price
Number % of Total Exercise Price Per Share at Expiration Appreciation for Option Term
Granted (1) Grants (2) Per Share Date of Grant Date -----------------------------
----------- ---------- -------------- ------------- ---------- 0% 5% 10%
-- -- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Steven P. Miller - - - - - - - -
Neal J. Tolar - - - - - - - -
Gary A. Monetti - - - - - - - -
Thomas L. Shoquist - - - - - - - -
Raymond A. Link 60,000 34.29% $11.05 $13.00 4/30/06 $117,000 $607,538 $1,360,119
<FN>
(1) The options become exercisable at a rate of 25% per year over four
years and have a term of 10 years. The potential realizable value is
calculated based on the term of the option at the time of the grant (10
years). Stock price appreciation of 5% and 10% is assumed pursuant to
rules promulgated by the Securities and Exchange Commission and does
not represent the Company's prediction of its stock price performance.
(2) Based on an aggregate of 175,000 options granted to employees and
directors of the Company in fiscal 1996 including the named executive
officers.
</FN>
</TABLE>
<TABLE>
Aggregate Option Exercises in Fiscal Year
1996 and Fiscal Year-End Option Values:
- ---------------------------------------
<CAPTION>
# of Shares Number of Securities
Acquired on Value Underlying Unexercised Value of In-The-Money
Exercise Realized (1) Options at Sept. 30, 1996 Options at Sept. 30, 1996(2)
----------- ------------ ------------------------- ----------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Steven P. Miller 330,000 $1,130,250 - - - -
Neal J. Tolar 330,000 $1,130,250 - - - -
Gary A. Monetti 94,100 $ 310,043 262,230 3,750 $6,762,475 $ 94,556
Thomas L. Shoquist 80,340 $ 275,165 - - - -
Raymond A. Link - - 25,000 135,000 $ 633,263 $2,796,788
<FN>
(1) Based on the product of (i) the fair market value of the Common Stock
at the date of exercise minus the exercise price and (ii) the number of
shares acquired upon exercise.
(2) Based on the product of (i) the fair market value of the Common Stock
at September 30, 1996 ($26 per share) minus the exercise price and (ii)
the number of shares acquired upon exercise.
</FN>
</TABLE>
9
<PAGE>
Security Ownership of Certain Beneficial Owners and Management
- --------------------------------------------------------------
<TABLE>
Directors, Executive Officers and Five Percent (5%) Shareholders:
- -----------------------------------------------------------------
<CAPTION>
Shares Beneficially Owned
-------------------------
Number Percent
------ -------
<S> <C> <C>
Principal Shareholders:
Employee Stock Ownership Plan and Trust
for Employees of Sawtek Inc.(1) 9,824,634 49.48%
Executive Officers and Directors:
Steven P. Miller (2) 1,481,346 7.46%
Neal J. Tolar (3) 1,428,777 7.20%
Thomas L. Shoquist (4) 349,809 1.76%
Gary A. Monetti (5) 298,090 1.50%
Raymond A. Link (6) 26,000 *
Robert C. Strandberg (7) 6,667 *
Bruce S. White 10,000 *
Willis C. Young - *
All directors and executive officers as a group (8 persons) 3,600,689 18.14%
<FN>
* Less than 1% of the outstanding Common Stock.
(1) Messrs. Miller, Tolar, Strandberg and Young are the Trustees of the
ESOP. The ESOP, through its Trustees, exercises sole dispositive and
voting control over these shares, all of which are held by the ESOP as
record owner. Includes 6,788,203 shares allocated to participants'
accounts and 3,036,431 shares not yet allocated to any participant's
account. Each ESOP participant, with respect to certain matters,
controls the voting of shares allocated to his or her account by
instructing the Trustees how such shares shall be voted. The Trustees
control the voting of all unallocated shares.
(2) Includes 436,323 shares held by Sawmill Investment Limited Partnership
of which Mr. Miller is the general partner and 63,188 shares held in
trust for his children. Excludes 204,677 shares owned by the ESOP, but
allocated to his account.
(3) Excludes 59,559 shares owned by his majority age children for which he
disclaims any beneficial interest. Excludes 200,980 shares owned by the
ESOP, but allocated to his account. Includes 381,201 shares held by MOP
Investment Limited Partnership of which Dr. Tolar is the general
partner.
10
<PAGE>
(4) Includes 200,000 shares held in trust in his spouse's name. Excludes
200,324 shares owned by the ESOP, but allocated to his account.
(5) Includes options to purchase 265,980 shares of Common Stock exercisable
within 60 days of October 31, 1996. Excludes 182,419 shares owned by the
ESOP, but allocated to his account.
(6) Includes options to purchase 25,000 shares of Common Stock exercisable
within 60 days of October 31, 1996. Excludes 14,360 shares owned by the
ESOP, but allocated to his account.
(7) Includes options to purchase 6,667 shares of Common Stock exercisable
within 60 days of October 31, 1996.
</FN>
</TABLE>
11
<PAGE>
SAWTEK INC.
1818 S. Highway 441
Apopka, Florida 32703
(407) 886-8860
PROXY
- -----
STEVEN P. MILLER, RAYMOND A. LINK AND WILLIAM A. GRIMM, or any of them, are
hereby authorized, with full power of substitution, to represent and to vote the
stock of the undersigned at the Annual Meeting of Shareholders of the Company to
be held on January 20, 1997, or at any adjournment, upon such business as may
properly come before the meeting, including the following items as set forth in
the Proxy Statement.
1. Election of Directors, Nominees:
Steven P. Miller, Neal J. Tolar,
Robert C. Strandberg, Bruce S. White,
Willis C. Young
For the above
slate of nominees Withheld
Election of Director _______ _______
If withheld, please list the nominee(s) that you are not in favor of:
- ---------------------------------------------
You are encouraged to specify your choices by marking the appropriate box. This
Proxy, when properly executed, is voted in the manner directed herein by the
undersigned stockholder. If no direction is made, this Proxy will be voted for
the election of Directors. The Proxies cannot vote your shares unless you sign
and return the Card. In their discretion, the Proxies are authorized to vote
upon such other business as may properly come before this meeting.
____ I plan to attend the meeting
Signature(s) _______________________________ Date ______________
Signature _______________________________ Date ______________
Please sign exactly as name appears above. When signing as attorney,
executor, administrator, Trustee, or guardian, give your full title as
such. All joint owners must sign.
(change of address) Shares in your name __________
- -----------------------------------
- -----------------------------------
- -----------------------------------
