<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<TABLE>
<S> <C>
Filed by the Registrant / /
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 Section240.14a-12
PRIMIX SOLUTIONS INC.
-----------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
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:
----------------------------------------------------------
</TABLE>
<PAGE>
PRIMIX SOLUTIONS INC.
ONE ARSENAL MARKETPLACE
WATERTOWN, MA 02472
------------------------
NOVEMBER 15, 2000
------------------------
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Primix Solutions Inc. (the "Company") to be held on December 15, 2000, at
1:00 p.m. eastern time, at the offices of McDermott, Will & Emery, 28 State
Street, Boston, MA 02109 (the "Annual Meeting").
The Annual Meeting has been called for the purpose of (i) electing two
Class I Directors for a three-year term and (ii) considering and voting upon
such other business as may properly come before the Annual Meeting or any
adjournments or postponements thereof.
The Board of Directors has fixed the close of business on November 3, 2000
as the record date for the determination of stockholders entitled to notice of,
and to vote at, the Annual Meeting and any adjournments or postponements
thereof.
The Board of Directors of the Company recommends that you vote "FOR" the
election of the nominees of the Board of Directors as Directors of the Company.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, YOU ARE REQUESTED TO
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE
WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF YOU ARE A
STOCKHOLDER OF RECORD AND YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE IN PERSON
EVEN IF YOU HAVE PREVIOUSLY RETURNED YOUR PROXY CARD.
Sincerely,
[/S/ MICHAEL D. TROIANO]
Michael D. Troiano
PRESIDENT
<PAGE>
PRIMIX SOLUTIONS INC.
ONE ARSENAL MARKETPLACE
WATERTOWN, MA 02472
(617) 923-6500
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER 15, 2000
------------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Primix
Solutions Inc. (the "Company") will be held on December 15, 2000, 1:00 p.m.
eastern time, at 28 State Street, Boston, MA 02109 (the "Annual Meeting") for
the purpose of considering and voting upon:
1. The election of two Class I Directors for a three-year term; and
2. Such other business as may properly come before the Annual Meeting and
adjournments or postponements thereof.
The Board of Directors has fixed the close of business on November 3, 2000
as the record date for the determination of stockholders entitled to notice of,
and to vote at, the Annual Meeting and any adjournments or postponements
thereof. Only holders of Common Stock of record at the close of business on such
date will be entitled to notice of, and to vote at, the Annual Meeting and any
adjournments or postponements thereof.
In the event there are not sufficient shares to be voted in favor of any of
the foregoing proposals at the time of the Annual Meeting, the Annual Meeting
may be adjourned in order to permit further solicitation of proxies.
By Order of the Board of Directors
/s/ David W. Chapman
David W. Chapman
SECRETARY
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE
REQUESTED TO COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF
YOU ARE A STOCKHOLDER OF RECORD AND YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE
IN PERSON EVEN IF YOU HAVE PREVIOUSLY RETURNED YOUR PROXY CARD.
<PAGE>
Watertown, MA
November 15, 2000
PRIMIX SOLUTIONS INC.
ONE ARSENAL MARKETPLACE
WATERTOWN, MA 02472
(617) 923-6500
------------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON FRIDAY, DECEMBER 15, 2000
------------------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Primix Solutions Inc. (the "Company") for
use at the Annual Meeting of Stockholders of the Company to be held on
December 15, 2000, 1:00 p.m. eastern time, at 28 State Street, Boston, MA 02109,
and any adjournments or postponements thereof (the "Annual Meeting").
At the Annual Meeting, the stockholders of the Company will be asked to
consider and vote upon the following matters:
1. The election of two Class I Directors of the Company, each for a
three-year term with such term to continue until the annual meeting of
stockholders to be held in the year 2003 (the "2003 Annual Meeting") and
until such Directors' successors are duly elected and qualified; and
2. Such other business as may properly come before the meeting and any
adjournments or postponements thereof.
The Notice of Annual Meeting, Proxy Statement and Proxy Card are first being
mailed to stockholders of the Company on or about November 15, 2000 in
connection with the notice of, and solicitation of proxies for, the Annual
Meeting. The Board of Directors has fixed the close of business on November 3,
2000 as the record date (the "Record Date") for the determination of
stockholders entitled to notice of, and to vote at, the Annual Meeting. Only
holders of record of the Company's Common Stock, par value $0.001 per share
("Common Stock"), at the close of business on the Record Date will be entitled
to notice of, and to vote at, the Annual Meeting. As of the Record Date, there
were approximately 16,674,460 shares of Common Stock outstanding and entitled to
vote at the Annual Meeting and approximately 193 stockholders of record. Each
holder of shares of Common Stock outstanding as of the close of business on the
Record Date will be entitled to one vote for each share held of record with
respect to the matters submitted at the Annual Meeting.
The presence, in person or by proxy, of a majority of the total number of
outstanding shares of Common Stock is necessary to constitute a quorum for the
transaction of business at the Annual Meeting. A quorum being present, the
affirmative vote of a plurality of the votes cast is necessary for the election
of the Class I Directors.
Shares that reflect abstentions or "broker non-votes" (i.e., shares
represented at the meeting held by brokers or nominees as to which the
instructions have not been received from the beneficial owners or persons
entitled to vote such shares and with respect to which the broker or nominee
does not have
1
<PAGE>
discretionary voting power to vote such shares) will be counted for purposes of
determining whether a quorum is present for the transaction of business at the
meeting. With respect to the election of Directors, votes may be cast in favor
of or withheld from the nominee; votes that are withheld and broker non-votes
will be excluded entirely from the vote and will have no effect.
STOCKHOLDERS OF THE COMPANY ARE REQUESTED TO COMPLETE, DATE, SIGN AND RETURN
THE ACCOMPANYING PROXY CARD IN THE ENCLOSED ENVELOPE. COMMON STOCK REPRESENTED
BY PROPERLY EXECUTED PROXIES RECEIVED BY THE COMPANY AND NOT REVOKED WILL BE
VOTED AT THE ANNUAL MEETING IN ACCORDANCE WITH THE INSTRUCTIONS CONTAINED
THEREIN. IF INSTRUCTIONS ARE NOT STATED THEREIN, PROPERLY EXECUTED PROXIES WILL
BE VOTED "FOR" THE ELECTION OF THE NOMINEES FOR THE CLASS I DIRECTORS NAMED IN
THIS PROXY STATEMENT. IT IS NOT ANTICIPATED THAT ANY MATTERS OTHER THAN THE
ELECTION OF THE CLASS I DIRECTORS WILL BE PRESENTED AT THE ANNUAL MEETING. IF
OTHER MATTERS ARE PRESENTED, PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
DISCRETION OF THE PROXY HOLDERS.
Any properly completed proxy may be revoked by the stockholder of record
represented by such proxy at any time before it is voted on any matter (without,
however, affecting any vote taken prior to such revocation) by giving written
notice of such revocation to the Secretary of the Company, or by signing and
duly delivering a proxy bearing a later date, or by attending the Annual Meeting
and voting in person. Attendance at the Annual Meeting will not, by itself,
revoke a proxy.
The Annual Report of the Company, including financial statements for the
fiscal year ended December 31, 1999 ("Fiscal Year 1999"), is being mailed to
stockholders of the Company concurrently with this Proxy Statement. The Annual
Report, however, is not a part of the proxy solicitation materials.
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors of the Company (the "Board") is divided into three
classes and is comprised of two Directors in Class I and one Director in each of
Classes II and III. Directors serve for three-year terms with one class of
Directors being elected by the Company's stockholders at each annual meeting.
At the Annual Meeting, two Class I Directors will be elected to serve until
the 2003 Annual Meeting and until such Directors' successors are duly elected
and qualified. The Board has nominated Lennart Mengwall and Magnus Nicolin (the
"Nominees") for election as Class I Directors. Unless otherwise specified in the
proxy, it is the intention of the persons named in the proxy to vote the shares
represented by each properly executed proxy for the election of the Nominees as
Class I Directors. The Nominees have agreed to stand for election and to serve,
if elected, as Class I Directors. However, if the Nominees fail to stand for
election or are unable to accept election, proxies will be voted for the
election of such other persons as the Board may recommend.
VOTE REQUIRED FOR APPROVAL
A quorum being present, the affirmative vote of a plurality of the votes
cast is necessary to elect the Nominees as Class I Directors of the Company.
THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF THE NOMINEES OF THE BOARD AS
DIRECTORS AS CLASS I DIRECTORS OF THE COMPANY.
INFORMATION REGARDING DIRECTORS
The Board held five (5) meetings during Fiscal Year 1999. During Fiscal Year
1999, each of the incumbent Directors attended at least 75% of the total number
of meetings of the Board and of the
2
<PAGE>
committees of which he was a member held during his term of office. The
Company's Board has established an Audit Committee and a Compensation Committee.
The Audit Committee recommends the firm to be appointed as independent
accountants to audit financial statements and to perform services related to the
audit, reviews the scope and results of the audit with the independent
accountants, reviews with management and the independent accountants the
Company's year-end operating results, considers the adequacy of the internal
accounting procedures and considers the effect of such procedures on the
accountants' independence. The Audit Committee consists of Lennart Mengwall,
Magnus Nicolin and Robert Hedges, and held four (4) meetings during Fiscal Year
1999.
The Compensation Committee reviews and recommends the compensation
arrangements for all Directors and officers, approves such arrangements for
other senior level employees and administers and takes such other action as may
be required in connection with certain compensation and incentive plans of the
Company. The Compensation Committee also determines the options or stock to be
issued to eligible persons under the Company's 1995 Stock Plan and the 1996
Stock Plan (the "Stock Plans"), construes and interprets the Stock Plans, and
prescribes the terms and conditions of such options or stock. The Compensation
Committee also administers the Company's Employee Stock Purchase Plan. In
addition, the Compensation Committee establishes, amends and revokes rules and
regulations for the administration of all such plans. The Compensation Committee
consists of Magnus Nicolin and Kevin Azzouz.
Directors who are officers or employees of the Company receive no cash
compensation for service as Directors. Generally, Directors who are not officers
or employees of the Company ("Non-Employee Directors") receive such compensation
for their services as the Board may from time to time determine. Robert Hedges
received fees of $1,300 for meetings attended during Fiscal Year 1999. Each new
Director receives an option to purchase 20,000 shares of Common Stock and each
continuing Director automatically receives on January 1 of each year an option
to purchase 5,000 shares of Common Stock, in each case at an exercise price per
share equal to the fair market value of the underlying Common Stock as
determined under the 1996 Stock Plan. Currently, 25% of these options vest upon
the first anniversary of the grant date and the remainder vests quarterly in
equal installments over a three-year period thereafter and expires ten years
from the date of grant. All Directors are reimbursed for expenses incurred in
connection with attendance at meetings.
Set forth below is certain information regarding the Directors of the
Company, including the Class I Directors who have been nominated for election at
the Annual Meeting, based on information furnished by them to the Company.
<TABLE>
<CAPTION>
NAME AGE DIRECTOR SINCE
---- -------- --------------
<S> <C> <C>
CLASS I--TERM EXPIRES 2000
Magnus Nicolin*.......................................... 43 October 2000
Lennart Mengwall**....................................... 57 May 1997
CLASS II--TERM EXPIRES 2001
Kevin Azzouz............................................. 40 May 1997
CLASS III--TERM EXPIRES 2002
Robert B. Hedges, Jr..................................... 42 October 1998
</TABLE>
------------------------
* Nominee was elected on October 6, 2000 to fill the vacancy created on the
Board by the resignation of Ofer Nemirovsky.
** Nominee for re-election.
3
<PAGE>
The principal occupation and business experience for at least the last five
years of each Director of the Company is set forth below.
Lennart Mengwall has served as Chairman of the Board and Chief Executive
Officer since May 1997 and currently the Co-Chief Executive Officer with Kevin
Azzouz. Mr. Mengwall was President from May 1997 until December 1999.
Mr. Mengwall is presently a general partner of Avix Associates, L.P., which is
in turn the general partner of Avix Ventures, L.P., a principal stockholder of
the Company.
Kevin Azzouz has served as a Director of the Company since May 1997 and is
currently the Co-Chief Executive Officer with Lennart Mengwall. From 1994 to
March 1996, Mr. Azzouz served as the President and Chief Operating Officer of
Arcada Software. Mr. Azzouz is presently a general partner of Avix Associates,
L.P., which is in turn the general partner of Avix Ventures, L.P., a principal
stockholder of the Company.
Robert Hedges has served as a Director of the Company since October 1998.
Mr. Hedges is the Managing Director of the Retail Distribution Group at Fleet
Financial Group ("Fleet"). From 1995 to 1997, Mr. Hedges served as Fleet's
Director of Direct Financial Services Group.
Magnus Nicolin has served as a Director of the Company since October 2000.
Mr. Nicolin is an Executive Vice President of Esselte. Prior to joining Esselte
in 1998, Mr. Nicolin was the Group Vice President of Business Development of
Pitney Bowes. Prior to joining Pitney Bowes in 1995, Mr. Nicolin held a variety
of senior financial, strategic planning and general management roles at Credit
Lyonnais, Mercer Management, McKinsey & Co. and Bayer Diagnostre.
EXECUTIVE OFFICERS
Set forth below is certain information regarding each of the executive
officers of the Company as of November 3, 2000.
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
NAME AGE POSITION
---- -------- ------------------------------------------------
<S> <C> <C>
Lennart Mengwall*............................ 57 Chairman of the Board and Co-Chief Executive
Officer
Kevin Azzouz*................................ 40 Co-Chief Executive Officer
Michael D. Troiano........................... 33 President
Joseph W. Seebach............................ 38 Executive Vice President
David W. Chapman............................. 36 Chief Financial Officer, Treasurer and Secretary
Byung C. Choi................................ 41 Senior Vice President of Operations
Sarah Gibbs**................................ 31 Vice President of Human Resources
</TABLE>
------------------------
* Mr. Mengwall and Mr. Azzouz were named Co-Chief Executive Officers on
October 18, 2000
** Ms. Gibbs, Vice President of Human Resources, was appointed as an executive
officer of the Company on October 18, 2000.
The principal occupation and business experience for the last five years of
the Company's executive officers, other than such officers who also served as
Directors, is set forth below.
Michael D. Troiano was appointed as the Company's President in
December 1999 and served as Senior Vice President of Business Development from
January 1999 to December 1999. Mr. Troiano co-founded a strategic Internet
services firm, Brandscape, in 1996, acting as the firm's CEO from 1996
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<PAGE>
to December 1998. He was named CEO of Ogilvy & Mather Direct Interactive
Marketing Group in 1994, and led the re-launch of the group as Ogilvy & Mather
Interactive in 1995.
Joseph W. Seebach joined the Company as Senior Vice President in July 1997
and assumed the position of President of Software Products Group in
October 1997. After the Company consolidated its operations to one business
unit, Mr. Seebach was appointed to Senior Vice President of Sales & Marketing
and in March 1998 to the position of Executive Vice President. Prior to joining
the Company, Mr. Seebach served as General Manager, Consumer Products Division
of Seagate Software from January 1997 to July 1997, Vice President, Strategic
Accounts of Seagate Software from 1996 to 1997, and Vice President, Strategic
Business of Arcada Software from 1994 to 1996.
David W. Chapman was appointed as the Company's Chief Financial Officer in
March 1998 and had previously served as the Controller of the Company since
September 1995. Mr. Chapman was appointed as Secretary of the Company in
February 1998. From December 1993 to August 1995, Mr. Chapman was the Accounting
Manager of Astrum International.
Byung C. Choi joined the Company in January 1999 as the Senior Vice
President of Operations and was appointed as an executive officer of the Company
in December 1999. Mr. Choi co-founded a strategic Internet services firm,
Brandscape, in 1996, acting as the firm's Chief Operating Officer from 1996 to
December 1998. Mr. Choi was the Chief Operating Officer of Ogilvy & Mather
Interactive in 1995.
Sarah Gibbs, Vice President of Human Resources, was recently appointed as an
executive officer of the Company in October 2000. She has served as the Vice
President of Human Resources since December 1998, when Primix acquired
Advis, Inc. Ms. Gibbs served as the Vice President of Human Resources/Operations
at Advis from May 1997 to December 1998. Prior to joining the Company,
Ms. Gibbs was a human resources consultant at Strategic Outsourcing from
January 1993 to May 1997.
Each of the officers holds his respective office until the regular annual
meeting of the Board of Directors following the annual meeting of stockholders
and until his successor is elected and qualified or until his earlier
resignation or removal.
5
<PAGE>
EXECUTIVE COMPENSATION
The following sections of this Proxy Statement set forth and describe the
compensation paid or awarded to the Company's Chief Executive Officer and the
other most highly compensated executive officers who earned in excess of
$100,000 during Fiscal Year 1999 ("named executive officers").
SUMMARY COMPENSATION
SUMMARY COMPENSATION. The following summary compensation table sets forth
information concerning compensation for services rendered in all capacities
awarded to, earned by or paid to the Company's Chief Executive Officer and the
other named executive officers during each of fiscal years ended December 31,
1999, 1998 and 1997.
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
AWARDS
------------
ANNUAL COMPENSATION SECURITIES
--------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS ($) OPTIONS (#) COMPENSATION ($)(1)
--------------------------- -------- --------- --------- ------------ -------------------
<S> <C> <C> <C> <C> <C>
Lennart Mengwall, .................... 1999 -- -- 300,000 --
Chairman of the Board and Chief 1998 -- -- -- --
Executive Officer 1997 -- -- -- --
Michael D. Troiano, .................. 1999 120,192 66,583 200,000 12,505
President(3)
Joseph W. Seebach, ................... 1999 150,481 112,375 50,000 --
Executive Vice President 1998 161,654 62,560 -- --
1997 83,078 75,000 350,000 --
David W. Chapman, .................... 1999 115,369 46,640 32,493 2,331
Chief Financial Officer, Treasurer 1998 112,654 16,705 -- 1,941
and Secretary(2)
Byung C. Choi, ....................... 1999 120,192 66,583 100,000 84,491
Senior Vice President of
Operations(3)
</TABLE>
------------------------
(1) Represents Company contributions to the Company's 401(k) plan on behalf of
the named executive officers.
(2) Mr. Chapman was not an executive officer of the Company during 1997.
(3) Mr. Troiano and Mr. Choi joined the Company during 1999. Included in "All
Other Compensation" are relocation expenses totaling $10,433 and $82,419 for
Mr. Troiano and Mr. Choi, respectively.
6
<PAGE>
OPTION GRANTS. The following table sets forth certain information
concerning the individual grant of options to purchase Common Stock of the
Company to the named executive officers of the Company who received options
during Fiscal Year 1999.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
----------------------------------------------------- VALUE AT ASSUMED
NUMBER OF PERCENT OF ANNUAL RATES OF STOCK
SECURITIES TOTAL OPTIONS EXERCISE PRICE APPRECIATION FOR
UNDERLYING GRANTED TO RATES OR OPTION TERM(1)
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION -----------------------
NAME GRANTED (#) FISCAL YEAR ($/SH) DATE 5%($) 10%($)
---- ----------- ------------- ---------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Lennart Mengwall............ 300,000 11.6% $2.94 9/16/09 $546,489 $1,392,275
Michael D. Troiano.......... 70,000 2.7 2.44 3/11/09 107,327 271,988
7,500 0.3 2.44 4/8/09 11,499 29,142
22,500 0.9 2.56 5/14/09 36,267 91,907
100,000 3.9 10.56 12/17/09 735,484 1,796,817
Joseph W. Seebach........... 50,000 1.9 2.44 3/11/09 76,662 194,277
David W. Chapman............ 32,493 1.3 2.44 3/11/09 49,820 126,253
Byung C. Choi............... 70,000 2.7 2.44 3/11/09 107,327 271,988
7,500 0.3 2.44 4/8/09 11,499 29,142
22,500 0.9 2.56 5/14/09 36,267 91,907
</TABLE>
------------------------
(1) This column shows the hypothetical gain or option spreads of the options
granted based on assumed annual compound stock appreciation rates of 5% and
10% for the exercise price of such options over the full 10-year term of the
options. The 5% and 10% assumed rates of appreciation are mandated by the
rules of the Securities and Exchange Commission and do not represent the
Company's estimate or projection of future Common Stock prices.
OPTION EXERCISES AND OPTION VALUES. The following table sets forth
information concerning the number of underlying shares and value of unexercised
options to purchase Common Stock of the Company held by the named executive
officers as of December 31, 1999.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN THE MONEY OPTIONS AT
SHARES DECEMBER 31, 1999 (#) DECEMBER 31, 1999 ($)(1)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------ ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Lennart Mengwall......... -- $ -- -- 300,000 $ -- $1,687,500
Michael D. Troiano....... -- -- -- 200,000 -- 609,688
Joseph W. Seebach........ 20,000 148,130 120,625 159,375 716,271 955,719
David W. Chapman......... 12,000 91,712 12,175 50,825 74,320 310,934
Byung C. Choi............ -- -- -- 100,000 -- 609,688
</TABLE>
------------------------
(1) Based on the last reported sale price on the Nasdaq National Market on
December 31, 1999 of $8.563 less the option exercise price. Options are
in-the-money if the fair market value of the shares covered thereby is
greater than the option exercise price.
7
<PAGE>
EMPLOYMENT AGREEMENTS WITH EXECUTIVE OFFICERS
The Company has entered into letter agreements with each of its executive
officers (other than Lennart Mengwall, the Company's Chairman and Chief
Executive Officer), providing for base salary, bonus, incentive compensation and
relocation expense reimbursement, as applicable.
Under an agreement dated in September 1999, Lennart Mengwall is entitled to
the acceleration of all options, in the event of (i) a termination of employment
for any reason other than gross misconduct or (ii) a "change in control" of the
Company, as defined in the agreement.
Under an agreement dated in March 1999, Joseph Seebach is entitled to the
acceleration of all options, in the event of (i) a termination of employment for
any reason other than gross misconduct or (ii) a "change in control" of the
Company, as defined in the agreement.
Under an agreement dated February 26, 1998, David W. Chapman is entitled to
receive his base salary and continued medical and dental benefits for six months
after termination of his employment for any reason other than gross misconduct.
Under an agreement dated in March 1999, Mr. Chapman is entitled to the
acceleration of all options, in the event of (i) a termination of employment for
any reason other than gross misconduct or (ii) a "change in control" of the
Company, as defined in the agreement.
Under an agreement dated in January 1999, Byung C. Choi is entitled to
receive his base salary for six months after termination of his employment for
any reason other than gross misconduct.
Under an agreement dated in January 1999, Michael D. Troiano is entitled to
receive his base salary for six months after termination of his employment for
any reason other than gross misconduct.
Under the Company's standard Employee Agreement, each of the executives is
subject to provisions concerning the ownership, use and disclosure of the
Company's confidential information and intellectual property, and a one-year
restriction on competition with the Company following termination of employment
for any reason.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION
The Compensation Committee of the Board of Directors of the Company
currently consists of Magnus Nicolin and Kevin Azzouz.
COMPENSATION POLICIES FOR EXECUTIVE OFFICERS. The Compensation Committee's
executive compensation philosophy is: (i) to provide competitive levels of
compensation that integrate pay with the individual executive's performance and
the Company's annual and long-term performance goals; (ii) to motivate key
executives to achieve strategic business goals and reward them for their
achievement; (iii) to provide compensation opportunities and benefits that are
comparable to those offered by other companies in the information technology
consulting services industry, thereby allowing the Company to compete for and
retain talented executives who are critical to the Company's long-term success;
and (iv) to align the interests of key executives with the long-term interests
of stockholders and the enhancement of stockholder value through the granting of
stock options.
The compensation of the Company's executive officers is currently comprised
of annual base salary, annual performance incentives in the form of cash
bonuses, and long-term performance incentives in the form of stock option grants
under the Stock Plans.
The Compensation Committee has determined that the base salaries of
executive officers should be set at levels that are competitive with those in
the information technology consulting services industry. In addition, the
Compensation Committee believes that it is appropriate to reward outstanding
performance through a combination of cash bonuses and stock options to provide a
competitive compensation package that will enable the Company to attract and
retain the executives needed to achieve such performance. The Compensation
Committee also has determined that any stock
8
<PAGE>
option or other equity-based compensation should involve long-term vesting to
encourage tenure and enhancement of stockholder value over the long-term.
BASE SALARY AND BONUSES. Base salaries, bonuses and other compensation for
executive officers are targeted according to the salaries of employees holding
similar offices and having similar responsibilities within the information
technology consulting services industry. Annual salary adjustments for executive
officers are determined by evaluating the competitive marketplace, the
performance of the Company, the performance of the executive officers and any
change in the responsibilities assumed by the executive officers. Salary
adjustments are normally determined and made on an annual basis.
STOCK OPTION GRANTS. Stock options are designed to attract and retain
executives who can make significant contributions to the Company's success;
reward executives for such significant contributions; and give executives a
long-term incentive to encourage tenure; and align the interests of the
Company's executives with those of its stockholders. In determining whether to
grant stock options to executive officers, the Compensation Committee evaluates
each officer's performance, and awards reflect individual performance reviews.
The Compensation Committee also may grant stock options for executive retention
purposes, taking into account, among other things, general industry practices.
Stock options typically vest over four years in order to encourage performance
over the long-term. Stock options generally have been granted with a ten-year
term and an exercise price equal to 100% of the fair market value of the Common
Stock on the grant date.
COMPENSATION OF THE CO-CHIEF EXECUTIVE OFFICERS. Lennart Mengwall, the
Company's Chairman and Co-Chief Executive Officer and Kevin Azzouz, the
Company's Co-Chief Executive Officer, currently receive no cash compensation.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Since May 10, 1996 all executive officer compensation decisions have been
made by the Compensation Committee or the full Board of Directors. The
Compensation Committee reviews and makes recommendations regarding the
compensation for top management and key employees of the Company, including
salaries and bonuses. The current members of the Compensation Committee are
Magnus Nicolin and Kevin Azzouz. All Directors participated in deliberations of
the Company's Board of Directors concerning executive compensation during the
Company's fiscal year 1999.
9
<PAGE>
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage change in
the cumulative total shareholder return on the Company's Common Stock, based on
the market price of the Company's Common Stock with the total return of
companies included within the Nasdaq Stock Market Index and a peer group of
companies included within the Nasdaq Computer & Data Processing Industry Stock
Index, for the period commencing July 3, 1996 and ending December 31, 1999. The
calculation of total cumulative return assumes a $100 investment in the
Company's Common Stock, the Nasdaq Stock Market Index and the Nasdaq Computer &
Data Processing Industry Stock Index on July 3, 1996, the date of the Company's
initial public offering, and the reinvestment of all dividends.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPH FOR PRIMIX SOLUTIONS INC.
PRODUCED ON 11/08/2000 INCLUDING DATA TO 12/31/1999
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PRIMIX SOLUTIONS INC. NASDAQ STOCK MARKET (US COMPANIES) NASDAQ COMPUTER AND DATA PROCESSING STOCKS
<S> <C> <C> <C>
07/1996 100.0 100.0 100.0
12/1996 43.4 109.0 106.8
12/1997 9.0 133.5 131.2
12/1998 10.4 188.3 234.0
12/1999 47.6 349.8 514.3
</TABLE>
NOTES:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading day,
the preceding trading day is used.
D. The index level for all series was set to $100.0 on July 3, 1996.
10
<PAGE>
MARKET VALUE
On December 31, 1999, the closing price of a share of the Company's Common
Stock on the Nasdaq National Market was $8.563.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On February 3, 1998, the Company issued a promissory note in the amount of
$150,000 to Joseph W. Seebach, the Company's Executive Vice President. The
promissory note was secured by a perfected, first priority security interest in
100,000 shares of the Company's common stock owned by Mr. Seebach. The
promissory note was payable on December 31, 1999 and bore interest at a rate of
six and one-half percent per annum. The note was paid in full in January 2000.
In March 1999, the Company issued two separate promissory notes, each in the
amount of $75,000, to Michael D. Troiano, the Company's President, and to Byung
C. Choi, the Company's Senior Vice President of Operations. The promissory notes
were due on December 31, 2001 and bore interest at a rate of 6.75% per annum. On
September 20, 1999, the $75,000 note to Mr. Choi was cancelled and a new
promissory note totaling $250,000 was issued. The note bears interest at a rate
of 7% per annum until September 30, 2002 when the interest rate will convert to
the prime rate plus two percentage points for the remainder of the term. The
outstanding principal balance is payable quarterly in arrears in equal
installments beginning on January 1, 2005. This note is due on September 30,
2029. In January 2000, the $75,000 note to Mr. Troiano was cancelled and a new
promissory note totaling $250,000 was issued. The note bears interest at a rate
of 7% per annum until December 31, 2002 when the interest rate will convert to
the Prime rate plus two percentage points for the remainder of the term. The
outstanding principal balance is payable quarterly in arrears in equal
installments beginning on January 1, 2005. The note is due on December 31, 2029.
Mr. Hedges is the Managing Director of the Retail Distribution Group at
Fleet. During 1999, Fleet paid to Primix approximately $318,900 for professional
services rendered in the normal course of business.
11
<PAGE>
PRINCIPAL AND MANAGEMENT STOCKHOLDERS
The following table sets forth, to the best knowledge and belief of the
Company, certain information regarding the beneficial ownership of the Company's
Common Stock as of the date indicated by (i) each person known by the Company to
be the beneficial owner of more than 5% of the outstanding Common Stock as of
December 31, 1999, (ii) each of the Company's Directors as of the Record Date,
(iii) each of the named executive officers as of the Record Date and (iv) the
Company's executive officers and Directors as a group as of the Record Date.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP(2)
------------------------
NAME OF BENEFICIAL OWNER(1) SHARES(1) PERCENTAGE
--------------------------- ----------- ----------
<S> <C> <C>
Avix Ventures, L.P.(3) ..................................... 7,748,871 46.5%
160 West 66th Street
New York, NY 10023
OFFICERS AND DIRECTORS:
Lennart Mengwall(4)......................................... 8,148,621 48.6%
Joseph W. Seebach(5)........................................ 381,542 2.3%
David W. Chapman(6)......................................... 42,746 *
Michael D. Troiano(7)....................................... 68,374 *
Byung C. Choi(8)............................................ 43,278 *
Robert Hedges............................................... -- *
Magnus Nicolin.............................................. -- *
Kevin Azzouz(9)............................................. 7,748,871 46.5%
All Directors and executive officers as a group(10)......... 8,721,900 51.2%
</TABLE>
------------------------
* Represents less than 1% of the outstanding shares.
(1) Information with respect to beneficial owners of more than 5% of the
outstanding shares of Common Stock is based solely on information provided
to the Company and reported to the Commission on Schedules 13D and 13G
filed as of February 14, 2000.
(2) All percentages have been determined as of the Record Date, in accordance
with Rule 13d-3 under the Securities Exchange Act of 1934, as amended. As
of the Record Date, a total of approximately 16,674,460 shares of Common
Stock were issued and outstanding.
(3) As reported on Schedule 13D/A filed with the Securities and Exchange
Commission on June 24, 1997 by Avix Ventures, L.P., of which Avix
Associates, L.P. is the general partner, of which Lennart Mengwall and
Kevin Azzouz are general partners.
(4) Represents 7,748,871 shares held by Avix Ventures, L.P., 306,000 shares
beneficially owned by Mr. Mengwall and 93,750 shares of Common Stock which
Mr. Mengwall may acquire upon exercise of stock options within 60 days of
the Record Date. Mr. Mengwall is a general partner of Avix Associates,
L.P., the general partner of Avix Ventures, L.P.
(5) Includes 124,492 shares which Mr. Seebach may acquire upon exercise of
stock options within 60 days of the Record Date.
(6) Includes 10,020 shares which Mr. Chapman may acquire upon exercise of stock
options within 60 days of the Record Date.
12
<PAGE>
(7) Includes 1,500 shares beneficially owned by Mr. Troiano and 66,874 shares
which Mr. Troiano may acquire upon exercise of stock options within
60 days of the Record Date.
(8) Includes 42,374 shares which Mr. Choi may acquire upon exercise of stock
options within 60 days of the Record Date.
(9) Represents shares held by Avix Ventures, L.P. Mr. Azzouz is a general
partner of Avix Associates, L.P., the general partner of Avix Ventures,
L.P. K. Azzouz is a general partner of Avix Associates, L.P., the general
partner of Avix Venture, L.P.
(10) Includes 368,072 shares which may be acquired upon exercise of stock
options within 60 days of the Record Date.
EXPENSES OF SOLICITATION
The Company will bear the cost of soliciting proxies for the Annual Meeting.
In addition to solicitations by mail, certain Directors, officers and regular
employees of the Company (who will receive no compensation for their services
other than their regular compensation) may solicit proxies by telephone,
telegram or personal interview. Banks, brokerage houses, custodians, nominees
and other fiduciaries have been requested to forward proxy materials to the
beneficial owners of shares held of record by them and such custodians will be
reimbursed for their expenses.
SUBMISSION OF STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Stockholder proposals intended to be presented at the Company's 2001 Annual
Meeting of stockholders must be received by the Company on or before July 18,
2001 in order to be considered for inclusion in the Company's proxy statement
and form of proxy for that meeting. The Company's By-laws provide that any
stockholder of record wishing to have a stockholder proposal considered at an
annual meeting must provide written notice of such proposal and appropriate
supporting documentation, as set forth in the By-laws, to the Company at its
principal executive office not less than 75 days or more than 120 days prior to
the first anniversary of the date of the preceding year's annual meeting. In the
event, however, that the annual meeting is scheduled to be held more than
30 days before such anniversary date or more than 60 days after such anniversary
date, notice must be so delivered not later than (i) the 15th day after the date
of public disclosure of the date of such meeting or (ii) the 75th day prior to
the scheduled date of such meeting. Any such proposal should be mailed to:
Secretary, Primix Solutions Inc., One Arsenal Marketplace, 2nd Floor, Watertown,
MA 02472.
INDEPENDENT ACCOUNTANTS
The Company has selected Arthur Andersen LLP as the independent public
accountants for the Company for the current fiscal year. The firm of Arthur
Andersen LLP has served as the Company's independent public accountants since
1996. A representative of Arthur Andersen LLP will be present at the Annual
Meeting and will be given the opportunity to make a statement if he or she so
desires. The representative will be available to respond to appropriate
questions.
COMPLIANCE WITH SECTION 16(a) OF
THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and Directors, and persons who own more than 10% of the Company's
outstanding shares of Common Stock (collectively, "Section 16 Persons"), to file
initial reports of ownership and reports of changes in ownership with the
Commission and Nasdaq. Section 16 Persons are required by Commission regulations
to furnish the Company with copies of all Section 16(a) forms they file.
13
<PAGE>
Based solely on its review of the copies of such forms received by it, or
written representations from certain Section 16 Persons that no Section 16(a)
reports were required for such persons, the Company believes that during Fiscal
Year 1999 the Section 16 Persons complied with all Section 16(a) filing
requirements applicable to them, with the exception of Byung Choi who did not
file Form 3 with respect to being appointed as an officer of the Company and
Lennart Mengwall, Michael Troiano, Joseph Seebach and David Chapman, who did not
timely file Forms 5 with respect to the grant of stock options in Fiscal Year
1999.
OTHER MATTERS
The Board of Directors does not know of any matters other than those
described in this Proxy Statement which will be presented for action at the
Annual Meeting. If other matters are duly presented, proxies will be voted in
accordance with the best judgment of the proxy holders.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE
REQUESTED TO COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
14
<PAGE>
PRIMIX SOLUTIONS INC.
ONE ARSENAL MARKETPLACE
WATERTOWN, MASSACHUSETTS 02472
ANNUAL MEETING OF STOCKHOLDERS - DECEMBER 15, 2000
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, revoking all prior proxies, hereby appoints Michael D.
Trolano and David W. Chapman as proxies, with full power of substitution to
each, to vote for and on behalf of the undersigned at the 2000 Annual Meeting
of Stockholders of Primix Solutions Inc. (the "Company") to be held at the
offices of McDermott, Will & Emery, 28 State Street, Boston, Massachusetts
02109 on Friday, December 15, 2000 at 1:00 p.m., and at any adjournment or
adjournments thereof. The undersigned hereby directs the said proxies to vote
in accordance with their judgment on any matters which may properly come
before the Annual Meeting, all as indicated in the Notice of Annual Meeting,
receipt of which is hereby acknowledged, and to act on the following matters
set forth in such notice as specified by the undersigned.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED HEREIN BY THE
UNDERSIGNED STOCKHOLDER(S). IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED "FOR" PROPOSAL 1.
-------------------------------------------------------------------------------
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Please sign exactly as your name(s) appear(s) on the books of the Company.
Joint owners should each sign personally. Trustees and other fiduciaries
should indicate the capacity in which they sign, and where more than one name
appears, a majority must sign. If a corporation, this signature should be
that of an authorized officer who should state his or her title.
--------------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ------------------------------------
----------------------------------- ------------------------------------
----------------------------------- ------------------------------------
<PAGE>
/x/ PLEASE MARK VOTES
AS IN THIS EXAMPLE
-----------------------------------------------------------------
PRIMIX SOLUTIONS INC.
-----------------------------------------------------------------
CONTROL NUMBER:
RECORD DATE SHARES:
--------------------
Please be sure to sign and date this proxy. Date
-----------------------------------------------------------------
------Stockholder sign here---------------Co-owner sign here-----
DETACH CARD
1. Election of Directors. For All With- For All
Nominees held Except
(01) Lennart Mengwall / / / / / /
(02) Magnus Nicolin
NOTE: If you do not wish your shares voted "For" a particular nominee,
mark the "For All Except" box and strike a line through the name of the
nominee(s). Your shares will be voted for the remaining nominee.
NOTE: If you do not mark any box, your shares will be voted FOR this Proposal.
2. In their discretion, the proxies are authorized to vote upon such other
business that may properly come before the meeting or at any
adjournment(s) thereof.
Mark box at right if an address change or comment has been / /
noted on the reverse side of this card.
DETACH CARD
PRIMIX SOLUTIONS INC.
Dear Stockholder,
Please take note of the important information enclosed with this
Proxy Ballot. There are a number of issues related to the management
and operation of your Corporation that require your immediate
attention and approval. These are discussed in detail in the enclosed
proxy materials.
Your vote counts, and you are strongly encouraged to exercise your
right to vote your shares.
Please mark the boxes on this proxy card to indicate how your shares
will be voted. Then sign the card, detach it and return your proxy
vote in the enclosed postage paid envelope.
Your vote must be received prior to the Annual Meeting of Shareholders,
December 15, 2000.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
Primix Solutions Inc.
