SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
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 Section 240.14a-11(c) or
Section 240.14a-12
THERMO FIBERGEN INC.
--------------------
(Name of Registrant as Specified in Charter)
--------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
[ X ]No fee required.
[ ]Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction
applies: ______________________________________________
(2) Aggregate number of securities to which transaction
applies: ______________________________________________
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth
the amount on which the filing fee is calculated and
state how it was determined): _________________________
(4) Proposed maximum aggregate value of transaction: ______
(5) Total 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
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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: ___________________________________________
Notes:
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THERMO FIBERGEN INC.
8 Alfred Circle
Bedford, Massachusetts 01730
April 29, 1997
Dear Stockholder:
The enclosed Notice calls the 1997 Annual Meeting of the
Stockholders of Thermo Fibergen Inc. I respectfully request all
Stockholders attend this meeting, if possible.
Our Annual Report for the year ended December 28, 1996, is
enclosed. I hope you will read it carefully. Feel free to forward
any questions you may have if you are unable to be present at the
meeting.
Enclosed with this letter is a proxy authorizing three
officers of the Corporation to vote your shares for you if you do
not attend the meeting. Whether or not you are able to attend the
meeting, I urge you to complete your proxy and return it to our
transfer agent, American Stock Transfer and Trust Company, in the
enclosed addressed, postage-paid envelope, as a quorum of the
Stockholders must be present at the meeting, either in person or
by proxy.
I would appreciate your immediate attention to the mailing
of this proxy.
Yours very truly,
YIANNIS A. MONOVOUKAS
President and Chief Executive
Officer
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THERMO FIBERGEN INC.
8 Alfred Circle
Bedford, Massachusetts 01730
April 29, 1997
To the Holders of the Common Stock of
THERMO FIBERGEN INC.
NOTICE OF ANNUAL MEETING
The 1997 Annual Meeting of the Stockholders of Thermo
Fibergen Inc. (the "Corporation") will be held on Monday, June 2,
1997, at 8:00 a.m. at The Hyatt Regency Hotel, Hilton Head, South
Carolina. The purpose of the meeting is to consider and take
action upon the following matters:
1. Election of five directors.
2. Such other business as may properly be brought before the
meeting and any adjournment thereof.
The transfer books of the Corporation will not be closed
prior to the meeting, but, pursuant to appropriate action by the
Board of Directors, the record date for the determination of the
Stockholders entitled to notice of and vote at the meeting is
April 7, 1997.
The By-laws require that the holders of a majority of the
stock issued and outstanding and entitled to vote be present or
represented by proxy at the meeting in order to constitute a
quorum for the transaction of business. It is important that your
shares be represented at the meeting regardless of the number of
shares you may hold. Whether or not you are able to be present in
person, please sign and return promptly the enclosed proxy in the
accompanying envelope, which requires no postage if mailed in the
United States.
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This Notice, the proxy and proxy statement enclosed herewith
are sent to you by order of the Board of Directors.
SANDRA L. LAMBERT
Secretary
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PROXY STATEMENT
The enclosed proxy is solicited by the Board of Directors of
Thermo Fibergen Inc. (the "Corporation") for use at the 1997
Annual Meeting of the Stockholders (the "Meeting") to be held on
Monday, June 2, 1997, at 8:00 a.m. at The Hyatt Regency Hotel,
Hilton Head, South Carolina, and any adjournment thereof. The
mailing address of the executive office of the Corporation is 8
Alfred Circle, Bedford, Massachusetts 01730. This proxy
statement and the enclosed proxy were first furnished to
Stockholders of the Corporation on or about May 2, 1997.
VOTING PROCEDURES
The Board of Directors intends to present to the Meeting the
election of five directors, constituting the entire Board of
Directors.
The representation in person or by proxy of a majority of
the outstanding shares of the common stock, $0.01 par value
("Common Stock"), of the Corporation entitled to vote at the
Meeting is necessary to provide a quorum for the transaction of
business at the Meeting. Shares can only be voted if the
Stockholder is present in person or is represented by returning a
properly signed proxy. Each Stockholder's vote is very important.
Whether or not you plan to attend the Meeting in person, please
sign and promptly return the enclosed proxy card, which requires
no postage if mailed in the United States. All signed and
returned proxies will be counted towards establishing a quorum
for the Meeting, regardless of how the shares are voted.
Shares represented by proxy will be voted in accordance with
your instructions. You may specify your choice by marking the
appropriate box on the proxy card. If your proxy card is signed
and returned without specifying choices, your shares will be
voted for the management nominees for directors and as the
individuals named as proxy holders on the proxy deem advisable on
all other matters as may properly come before the Meeting.
In order to be elected a director, a nominee must receive
the affirmative vote of a majority of the shares of Common Stock
present and entitled to vote on the election. Withholding
authority to vote for a nominee for director will be treated as
shares present and entitled to vote and, for purposes of
determining the outcome of the vote, will have the same effect as
a vote against the nominee. With respect to the election of
directors, broker "non-votes" will not be treated as shares
present and entitled to vote on a voting matter and will have no
effect on the outcome of the vote. A broker "non-vote" occurs
when a nominee holding shares for a beneficial holder does not
have discretionary voting power and does not receive voting
instructions from the beneficial owner.
A Stockholder who returns a proxy may revoke it at any time
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before the Stockholder's shares are voted at the Meeting by
written notice to the Secretary of the Corporation received prior
to the Meeting, by executing and returning a later dated proxy or
by voting by ballot at the Meeting.
The outstanding stock of the Corporation entitled to vote
(excluding shares held in treasury by the Corporation) as of
April 7, 1997 consisted of 14,715,000 shares of Common Stock.
Only Stockholders of record at the close of business on April 7,
1997 are entitled to vote at the Meeting. Each share is entitled
to one vote.
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- PROPOSAL 1 -
ELECTION OF DIRECTORS
Five directors are to be elected at the Meeting, each to
hold office until his or her successor is chosen and qualified or
until his or her earlier resignation, death or removal.
Nominees For Directors
Set forth below are the names of the persons nominated as
directors, their ages, their offices in the Corporation, if any,
their principal occupation or employment for the past five years,
the length of their tenure as directors and the names of other
public companies in which such persons hold directorships.
Information regarding their beneficial ownership of the
Corporation's Common Stock and of the common stock of its parent
company, Thermo Fibertek Inc. ("Thermo Fibertek"), a manufacturer
of equipment for the paper and paper-recycling industries, and
Thermo Fibertek's parent company, Thermo Electron Corporation
("Thermo Electron"), a diversified high technology company, is
reported under the caption "Stock Ownership." All of the nominees
are currently directors of the Corporation.
Anne T. Barrett Ms. Barrett, 67, has been a director of the
Corporation since July 1996. Ms. Barrett has
been an independent consultant on investor
relations and communications matters since her
retirement from Thermo Electron in November
1993. Prior to that time, Ms. Barrett was
director of corporate communications for Thermo
Electron for more than five years.
Francis L. Mr. McKone, 62, has been a director of the
McKone Corporation since April 1997. Mr. McKone has
been the chief executive officer of Albany
International Corp., a worldwide supplier of
paper machine fabrics, since February 1993. For
more than five years prior to 1993, Mr. McKone
served as the co-chief executive officer of
Albany International Corp. He is also a
director of Albank Financial Corporation.
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Yiannis A. Dr. Monovoukas, 36, has been president, chief
Monovoukas executive officer and a director of the
Corporation since its incorporation in February
1996. Dr. Monovoukas was a corporate business
analyst with Thermo Electron from July 1995 to
February 1996. From 1993 through June 1995,
Dr. Monovoukas was a graduate student at the
Harvard Business School. From 1990 until 1993
he was a staff scientist/engineer with Raychem
Corporation, a materials science company, which
he joined upon completion of a Ph.D. program in
chemical engineering at Stanford University.
Jonathan W. Mr. Painter, 38, has been treasurer and a
Painter director of the Corporation since its
incorporation in February 1996. Mr. Painter
has been treasurer of Thermo Electron since
August 1994 and treasurer of Thermo Fibertek
since October 1994. Mr. Painter had served as
director of strategic planning of Thermo
Fibertek from February 1993 through August
1994. For five years prior to that time, Mr.
Painter was associate general counsel of
Thermo Electron and its subsidiaries. Mr.
Painter is also a director of Thermo
BioAnalysis Corporation.
William A. Mr. Rainville, 55, has been chairman of the
Rainville board and a director of the Corporation since
its incorporation in February 1996. Mr.
Rainville has been president and chief
executive officer of Thermo Fibertek since its
inception in November 1991 and a director of
Thermo Fibertek since January 1992. From 1984
until January 1993, Mr. Rainville was president
and chief executive officer of Thermo Web
Systems Inc., a subsidiary of Thermo Fibertek.
He has been a senior vice president of Thermo
Electron since March 1993 and was a vice
president from 1986 to 1993. Mr. Rainville is
also a director of Thermo Fibertek, Thermo
Ecotek Corporation, Thermo Remediation Inc. and
Thermo TerraTech Inc.
Committees of the Board of Directors and Meetings
The Board of Directors has established an Audit Committee
and a Human Resources Committee, each consisting solely of
outside directors. During 1996, the only member of these
committees was Ms. Barrett. The present members of the Audit
Committee are Mr. McKone (Chairman) and Ms. Barrett. The Audit
Committee reviews the scope of the audit with the Corporation's
independent public accountants and meets with them for the
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purpose of reviewing the results of the audit subsequent to its
completion. The present members of the Human Resources Committee
are Ms. Barrett (Chairman) and Mr. McKone. The Human Resources
Committee reviews the performance of senior members of
management, recommends executive compensation and administers the
Corporation's stock option and other stock-based compensation
plans. The Corporation does not have a nominating committee of
the Board of Directors. The Board of Directors met one time and
the Audit and Human Resources Committees did not meet during
fiscal 1996. Each director attended at least 75% of all meetings
of the Board of Directors and committees on which he or she
served held during fiscal 1996.
Compensation of Directors
Cash Compensation
Directors who are not employees of the Corporation, of
Thermo Electron or of any other companies affiliated with Thermo
Electron (also referred to as "outside directors") receive an
annual retainer of $2,000 and a fee of $1,000 per day for
attending regular meetings of the Board of Directors and $500 per
day for participating in meetings of the Board of Directors held
by means of conference telephone and for participating in certain
meetings of committees of the Board of Directors. Payment of
directors' fees is made quarterly. Dr. Monovoukas, Mr. Painter
and Mr. Rainville are all employees of Thermo Electron companies
and do not receive any cash compensation from the Corporation for
their services as directors. Directors are also reimbursed for
out-of-pocket expenses incurred in attending such meetings.
Deferred Compensation Plan
Under the Corporation's deferred compensation plan for
directors (the "Deferred Compensation Plan"), a director has the
right to defer receipt of his cash fees until he ceases to serve
as a director, dies or retires from his principal occupation. In
the event of a change in control or proposed change in control of
the Corporation that is not approved by the Board of Directors,
deferred amounts become payable immediately. Either of the
following is deemed to be a change of control: (a) the
occurrence, without the prior approval of the Board of Directors,
of the acquisition, directly or indirectly, by any person of 50%
or more of the outstanding Common Stock or the outstanding common
stock of Thermo Fibertek or 25% or more of the outstanding common
stock of Thermo Electron; or (b) the failure of the persons
serving on the Board of Directors immediately prior to any
contested election of directors or any exchange offer or tender
offer for the Common Stock or the common stock of Thermo Fibertek
or Thermo Electron to constitute a majority of the Board of
Directors at any time within two years following any such event.
Amounts deferred pursuant to the Deferred Compensation Plan are
valued at the end of each quarter as units of the Corporation's
Common Stock. When payable, amounts deferred may be disbursed
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solely in shares of Common Stock accumulated under the Deferred
Compensation Plan. A total of 25,000 shares of Common Stock have
been reserved for issuance under the Deferred Compensation Plan.
As of March 1, 1997, no deferred units were accumulated under the
Deferred Compensation Plan.
Directors Stock Option Plan
The Corporation's directors stock option plan (the
"Directors Plan") provides for the grant of stock options to
purchase shares of common stock of the Corporation to outside
directors as additional compensation for their service as
directors. The Directors Plan provides for the grant of stock
options upon a director's initial appointment and, beginning in
2000, awards options to purchase 1,000 shares annually to outside
directors. A total of 200,000 shares of Common Stock have been
reserved for issuance under the Directors Plan.
Under the Directors Plan, each outside director was granted
an option to purchase 20,000 shares of Common Stock upon the
effective date of the Corporation's initial public offering. The
size of awards to new directors appointed to the Board of
Directors after 1996 is reduced by 5,000 shares each year.
Outside directors who join the Board of Directors after 1999
would not receive an option grant upon their appointment or
election to the Board of Directors, but would be eligible to
participate in the annual option awards described below. Options
evidencing initial grants to directors are exercisable six months
after the date of grant. The shares acquired upon exercise are
subject to restrictions on transfer and the right of the
Corporation to repurchase such shares at the exercise price in
the event the director ceases to serve as a director of the
Corporation or any other Thermo Electron company. The
restrictions and repurchase rights lapse or are deemed to have
lapsed in equal annual installments of 5,000 shares per year,
starting with the first anniversary of the grant date, provided
the director has continuously served as a director of the
Corporation or any other Thermo Electron company since the grant
date. These options expire on the fifth anniversary of the grant
date, unless the director dies or otherwise ceases to serve as a
director of the Corporation or any other Thermo Electron company
prior to that date.
Outside directors will also receive an annual grant of
options to purchase 1,000 shares of Common Stock, commencing with
the Annual Meeting of the Stockholders to be held in 2000. The
annual grant will be made at the close of business on the date of
each Annual Meeting of the Stockholders of the Corporation to
each outside director then holding office. Options evidencing
annual grants may be exercised at any time from and after the
six-month anniversary of the grant date of the option and prior
to the expiration of the option on the third anniversary of the
grant date. Shares acquired upon exercise of the options would
be subject to repurchase by the Corporation at the exercise price
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if the recipient ceased to serve as a director of the Corporation
or any other Thermo Electron company prior to the first
anniversary of the grant date.
The exercise price for options granted under the Directors
Plan is the average of the closing prices of the common stock as
reported on the American Stock Exchange (or other principal
market on which the common stock is then traded) for the five
trading days preceding and including the date of grant, or, if
the shares are not then traded, at the last price per share paid
by third parties in an arms-length transaction prior to the
option grant. As of March 1, 1997, options to purchase 20,000
shares had been granted under the Directors Plan, no options had
lapsed, and options to purchase 180,000 shares of Common Stock
were available for grant under the Directors Plan.
Stock Ownership Policies for Directors
During 1997, the Human Resources Committee of the Board of
Directors (the "Committee") established a stock holding policy
for directors. The stock holding policy requires each director
to hold a minimum of 1,000 shares of Common Stock. Directors are
requested to achieve this ownership level by the 1998 Annual
Meeting of Stockholders. Directors who are also executive
officers of the Corporation are required to comply with a
separate stock holding policy established by the Committee in
1997, which is described in "Committee Report on Executive
Compensation - Stock Ownership Policies."
In addition, the Committee adopted a policy requiring
directors to hold shares of the Corporation's Common Stock equal
to one-half of their net option exercises over a period of five
years. The net option exercise is determined by calculating the
number of shares acquired upon exercise of a stock option, after
deducting the number of shares that could have been traded to
exercise the option and the number of shares that could have been
surrendered to satisfy tax withholding obligations attributable
to the exercise of the option. This policy is also applicable to
executive officers and is described in "Committee Report on
Executive Compensation - Stock Ownership Policies."
STOCK OWNERSHIP
The following table sets forth the beneficial ownership of
Common Stock, as well as the common stock of Thermo Fibertek, the
Corporation's parent company, and of Thermo Electron, Thermo
Fibertek's parent company, as of March 1, 1997, with respect to
(i) each person who was known by the Corporation to own
beneficially more than 5% of the outstanding shares of Common
Stock, (ii) each director, (iii) each executive officer named in
the summary compensation table under the heading "Executive
Compensation" and (iv) all directors and current executive
officers as a group.
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While certain directors and executive officers of the
Corporation are also directors and executive officers of Thermo
Fibertek or its subsidiaries other than the Corporation, all such
persons disclaim beneficial ownership of the shares of Common
Stock owned by Thermo Fibertek.
<TABLE>
<CAPTION>
Name Thermo Thermo Thermo
Fibergen Fibertek Electron
Inc. (2) Inc. (3) Corporation
(4)
<S> <C> <C> <C>
Thermo Fibertek Inc. (5) 10,000,000 N/A N/A
Anne T. Barrett 20,000 1,450 8,709
Francis L. McKone 0 0 0
Yiannis A. Monovoukas (6) 94,450 31,500 13,550
Jonathan W. Painter 20,000 103,515 33,271
William A. Rainville (6) 41,500 517,894 252,294
All directors and current
executive
officers as a group (7 200,950 859,014 979,590
persons)
</TABLE>
(1) Except as reflected in the footnotes to this table, shares
beneficially owned consist of shares owned by the indicated
person or by that person for the benefit of minor children and
all share ownership includes sole voting and investment power.
(2) Shares of the Common Stock beneficially owned by Ms.
Barrett, Dr. Monovoukas, Mr. Painter, Mr. Rainville and all
directors and executive officers as a group include 20,000,
80,000, 20,000, 40,000 and 185,000 shares, respectively, that
such person or group has the right to acquire within 60 days of
March 1, 1997, through the exercise of stock options. No
director or executive officer beneficially owned more than 1% of
the Common Stock outstanding as of March 1, 1997; all directors
and executive officers as a group beneficially owned 1.4% of the
Common Stock outstanding as of such date.
(3) Shares of the common stock of Thermo Fibertek beneficially
owned by Dr. Monovoukas, Mr. Painter, Mr. Rainville and all
directors and executive officers as a group include 30,000,
103,500, 495,000 and 799,950 shares, respectively, that such
person or group had the right to acquire within 60 days after
March 1, 1997, through the exercise of stock options. Shares of
the common stock of Thermo Fibertek beneficially owned by Ms.
Barrett includes 1,450 shares held by a trust of which Ms.
Barrett and her spouse are the trustees. Shares of the common
stock of Thermo Fibertek beneficially owned by Mr. Painter
include 15 shares held by him as custodian for one minor child.
No director or executive officer beneficially owned more than 1%
of the common stock of Thermo Fibertek outstanding as of March 1,
1997, all directors and executive officers as a group
beneficially owned 1.4% of the Thermo Fibertek common stock
outstanding as of such date.
(4) Shares of the common stock of Thermo Electron beneficially
owned by Dr. Monovoukas, Mr. Painter, Mr. Rainville and all
directors and executive officers as a group include 11,325,
27,035, 205,648 and 771,267 shares, respectively, that such
person or group has the right to acquire within 60 days of March
1, 1997, through the exercise of stock options. Shares of the
common stock of Thermo Electron beneficially owned by Mr. Painter
and all directors and executive officers as a group include 488
and 3,746 full shares, respectively, allocated to accounts
maintained pursuant to Thermo Electron's employee stock ownership
plan, of which the trustees, who have investment power over its
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assets, are executive officers of Thermo Electron. Shares
beneficially owned by Ms. Barrett include 6,010 shares held by a
trust of which Ms. Barrett and her spouse are the trustees. The
directors and executive officers did not individually or as a
group beneficially own more than 1% of the Thermo Electron common
stock outstanding as of March 1, 1997.
(5) As of March 1, 1997, Thermo Fibertek beneficially owned
approximately 68% of the outstanding Common Stock. Thermo
Fibertek's address is 81 Wyman Street, Waltham, Massachusetts
02254. As of March 1, 1997, Thermo Fibertek had the power to
elect all of the members of the Corporation's Board of Directors.
Thermo Fibertek is a majority-owned subsidiary of Thermo Electron
and therefore, Thermo Electron may be deemed a beneficial owner
of the shares of Common Stock beneficially owned by Thermo
Fibertek. Thermo Electron disclaims beneficial ownership of
these shares.
(6) As of March 1, 1997, Mr. Monovoukas and Mr. Rainville also
beneficially owned 14,450 and 1,500 redemption rights,
respectively, issued by the Corporation. Each of these rights,
issued in a public offering in September 1996, permits the holder
to sell one share of the Common Stock back to the Corporation at
certain periods in the future at a price of $12.25 per share.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934
requires the Corporation's directors and executive officers, and
beneficial owners of more than 10% of the Common Stock, such as
Thermo Fibertek and its parent company, Thermo Electron, to file
with the Securities and Exchange Commission initial reports of
ownership and periodic reports of changes in ownership of the
Corporation's securities. Based upon a review of such filings,
all Section 16(a) filing requirements applicable to such persons
were complied with during 1996, except in the following
instances. Thermo Fibertek filed two Forms 4 late, reporting a
total of three transactions consisting of the grant to employees
of options to purchase the Common Stock. Thermo Electron also
filed two Forms late, reporting a total of five transactions,
which included the three transactions described above for Thermo
Fibertek and an additional two transactions also consisting of
the grant to employees of options to purchase the Common Stock.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table summarizes compensation for services to
the Corporation in all capacities awarded to, earned by or paid
to the Corporation's chief executive officer for the last two
fiscal years. No other executive officer of the Corporation met
the definition of "highly compensated" within the meaning of the
Securities and Exchange Commission's executive compensation
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disclosure rules.
The Corporation is required to appoint certain executive
officers and full-time employees of Thermo Electron as executive
officers of the Corporation, in accordance with the Thermo
Electron Corporate Charter. The compensation for these executive
officers is determined and paid entirely by Thermo Electron. The
time and effort devoted by these individuals to the Corporation's
affairs is provided to the Corporation under the Corporate
Services Agreement between the Corporation and Thermo Electron.
Accordingly, the compensation for these individuals is not
reported in the following table.
<TABLE>
<CAPTION>
Summary Compensation Table
Long Term
Compensation
Securities
Underlying
Options All Other
Name and Fiscal Annual Compensation of Shares Compensation
Principal Position Year Salary Bonus and Company
(1)
<S> <C> <C> <C> <C>
Yiannis A. Monovoukas 1996 $100,000 $60,500 80,000(TFG) --
President & Chief 75(TMO)
Executive Officer 2,000(TBA)
30,000(TFT)
2,000(TLT)
6,000(TOC)
4,000(TMQ)
2,000(TSR)
2,000(TXM)
1995 $ 39,583(2) -- 11,250(TMO) --
</TABLE>
(1) Options granted by the Corporation are designated in the
table as "TFG." In addition, the named executive officer has
also been granted options to purchase the common stock of the
following Thermo Electron companies from time to time as part of
Thermo Electron's stock option program: Thermo BioAnalysis
Corporation (designated in the table as TBA), Thermo Electron
(designated in the table as TMO), Thermo Fibertek Inc.
(designated in the table as TFT), ThermoLyte Corporation
(designated in the table as TLT), Thermo Optek Corporation
(designated in the table as TOC), ThermoQuest Corporation
(designated in the table as TMQ), Thermo Sentron Inc. (designated
in the table as TSR) and Trex Medical Corporation (designated in
the table as TXM).
(2) Dr. Monovoukas was appointed president and chief executive
officer of the Corporation in February 1996. Prior to that time,
he served as a corporate business analyst for Thermo Electron
since joining Thermo Electron in July 1995. Reported in the
table under "Salary" is the salary paid in 1995 to Dr. Monovoukas
for his service as a corporate business analyst of Thermo
Electron, which was paid at an annualized rate of $95,000. None
of the bonus paid to Dr. Monovoukas with respect to 1995
performance was attributable to his service as president and
chief executive officer of the Corporation.
Stock Options Granted During Fiscal 1996
The following table sets forth information concerning
individual grants of stock options made during fiscal 1996 to the
Corporation's chief executive officer. It has not been the
Corporation's policy in the past to grant stock appreciation
rights, and no such rights were granted during fiscal 1996.
<TABLE>
<CAPTION>
Option Grants in Fiscal 1996
Potential
Realizable
Value at Assumed
Percent of Annual Rates of
Number of Total Stock
Securities Options Exercise Price Appreciation
Underlying Granted to Price for
Options Employees in Per Expiration Option Term (2)
Name (1) Granted (1) Fiscal Year Share Date 5% 10%
<S> <C> <C> <C> <C> <C> <C>
Yiannis A. 80,000 (TFG) 39.0% $10.00 08/14/08 $636,800 $1,710,400
Monovoukas
75 (TMO) 0.005% (3) $42.79 05/22/99 $506 $1,062
2,000 (TBA) 0.2% (3) $10.00 03/11/08 $15,920 $42,760
30,000 (TFT) 19.6% (3) $14.32 02/16/08 $342,000 $918,600
2,000 (TLT) 0.6% (3) $10.00 03/11/08 $15,920 $42,760
6,000 (TOC) 0.2% (3) $12.00 04/09/08 $57,300 $153,960
4,000 (TMQ) 0.1% (3) $13.00 03/11/08 $41,400 $111,200
2,000 (TSR) 0.4% (3) $14.00 03/11/08 $22,280 $59,800
2,000 (TXM) 0.1% (3) $11.00 03/11/08 $13,840 $35,060
</TABLE>
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(1) The options granted during the fiscal year are immediately
exercisable, except options to purchase the common stock of
ThermoLyte Corporation, which are not exercisable until the
earlier of (i) 90 days after the effective date of the
registration of that company's common stock under Section 12 of
the Securities Exchange Act of 1934 (the "Exchange Act") and (ii)
nine years after the grant date. In all cases, the shares
acquired upon exercise are subject to repurchase by the granting
corporation at the exercise price if the optionee ceases to be
employed by such corporation or any other Thermo Electron
company. The granting corporation may exercise its repurchase
rights within six months after the termination of the optionee's
employment. For publicly traded companies, the repurchase rights
generally lapse ratably over a five- to ten-year period,
depending on the option term, which may vary from seven to twelve
years, provided that the optionee continues to be employed by the
Corporation or another Thermo Electron company. For companies
that are not publicly traded, the repurchase rights lapse in
their entirety on the ninth anniversary of the grant date.
Certain options granted as part of Thermo Electron's stock option
program have three-year terms, and the repurchase rights lapse in
their entirety on the second anniversary of the grant date. The
granting corporation may permit the holder of options to exercise
options and to satisfy tax withholding obligations by
surrendering shares equal in fair market value to the exercise
price or withholding obligation.
(2) The amounts shown on this table represent hypothetical gains
that could be achieved for the respective options if exercised at
the end of the option term. These gains are based on assumed
rates of stock appreciation of 5% and 10% compounded annually
from the date the respective options were granted to their
expiration date. The gains shown are net of the option exercise
price, but do not include deductions for taxes or other expenses
associated with the exercise. Actual gains, if any, on stock
option exercises will depend on the future performance of the
common stock of the granting corporation, the optionee's
continued employment through the option period and the date on
which the options are exercised.
(3) These options were granted under stock option plans
maintained by Thermo Electron companies other than the
Corporation and accordingly are reported as a percentage of total
options granted to employees of Thermo Electron and its
subsidiaries.
Stock Options Exercised During Fiscal 1996 and Fiscal Year-End
Option Values
The following table reports certain information regarding
stock option exercises during fiscal 1996 and outstanding stock
options held at the end of fiscal 1996 by the Corporation's chief
executive officer. No stock appreciation rights were exercised
or were outstanding during fiscal 1996.
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<TABLE>
<CAPTION>
Aggregated Option Exercises In Fiscal 1996 And Fiscal 1996 Year-End Option Values
Number of
Unexercised
Options at
Shares Fiscal
Acquired Year-End Value of
on Value (Exercisable/ Unexercised
Name Company Exercise Realized Unexercisable) In-the-Money
(1) Options
<S> <C> <C> <C><C> <C> <C>
Yiannis A. Thermo Fibergen -- -- 80,000/0 $60,000/--
Monovoukas
Thermo Electron -- -- 11,325/0 $107,101/--
Thermo -- -- 2,000/0 $6,250/--
BioAnalysis
Thermo Fibertek -- -- 30,000/0 $0/--
ThermoLyte -- -- 0/2,000 --/$0(2)
Thermo Optek -- -- 6,000/0 $0/--
ThermoQuest -- -- 4,000/0 $0/--
Thermo Sentron -- -- 2,000/0 $0/--
Trex Medical -- -- 2,000/0 $3,250/--
</TABLE>
(1) All of the options reported outstanding at the end of the
fiscal year are immediately exercisable as of the fiscal
year-end, except options to purchase the common stock of
ThermoLyte Corporation, which are not exercisable until the
earlier of (i) 90 days after the effective date of the
registration of that company's common stock under Section 12 of
the Exchange Act and (ii) nine years after the grant date. In
all cases, the shares acquired upon exercise of the options
reported in the table are subject to repurchase by the granting
corporation at the exercise price if the optionee ceases to be
employed by such corporation or any other Thermo Electron
company. The granting corporation may exercise its repurchase
rights within six months after the termination of the optionee's
employment. For publicly traded companies, the repurchase rights
generally lapse ratably over a five- to ten-year period,
depending on the option term, which may vary from seven to twelve
years, provided that the optionee continues to be employed by the
Corporation or another Thermo Electron company. For companies
that are not publicly traded, the repurchase rights lapse in
their entirety on the ninth anniversary of the grant date.
Certain options granted as a part of Thermo Electron's stock
option program have three-year terms, and the repurchase rights
lapse in their entirety on the second anniversary of the grant
date. The granting corporation may permit the holder of such
options to exercise options and to satisfy tax withholding
obligations by surrendering shares equal in fair market value to
the exercise price or withholding obligation.
(2) No public market for the shares underlying these options
existed at fiscal year-end. Accordingly, no value in excess of
the exercise price has been attributed to these options.
COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Executive Compensation
All decisions on compensation for the Corporation's
executive officers are made by the Human Resources Committee of
the Board of Directors (the "Committee"). In reviewing and
establishing total cash compensation and stock-based compensation
for executives, the Committee follows guidelines established by
the Human Resources Committees of the Board of Directors of its
parent corporations, Thermo Electron and Thermo Fibertek. The
executive compensation program presently consists of annual base
salary ("salary"), short-term incentives in the form of annual
cash bonuses, and long-term incentives in the form of stock
options.
The Committee believes that the compensation of executive
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officers should reflect the scope of their responsibilities, the
success of the Corporation, and the contributions of each
executive to that success. In addition, the Committee believes
that base salaries should approximate the mid-point of
competitive salaries derived from market surveys and that
short-term and long-term incentive compensation should reflect
the performance of the Corporation and the contributions of each
executive.
External competitiveness is an important element of the
Committee's compensation policy. The competitiveness of the
Corporation's compensation for its executives is assessed by
comparing it to market data provided by its compensation
consultant and by participating in annual executive compensation
surveys, primarily "Project 777," an executive compensation
survey prepared by Management Compensation Services, a division
of Hewitt Associates. The majority of firms represented in the
Project 777 survey are included in the Standard & Poor's 500
Index, but do not necessarily correspond to the companies
included in the Corporation's peer group index, the Dow Jones
Total Return Index for the Paper Products Industry Group.
Principles of internal equity are also central to the
Committee's compensation policies. Compensation considered for
the Corporation's officers, whether cash or stock-based
incentives, is also evaluated by comparing it to compensation of
other executives within the Thermo Electron organization with
comparable levels of responsibility for comparably sized business
units.
The process for determining each of these elements for the
Corporation's executive officers is outlined below.
Base Salary
Base salaries are intended to approximate the mid-point of
competitive salaries for similar organizations of comparable size
and complexity to the Corporation. Executive salaries are
adjusted gradually over time and only as necessary to meet this
objective. Increases in base salary may be moderated by other
considerations, such as geographic or regional market data,
industry trends or internal fairness within the Corporation and
Thermo Electron. It is the Committee's intention that over time
the base salaries for executive officers will approach the
mid-point of competitive data. The salary increase in 1996 for
the chief executive officer generally reflects this practice of
gradual increases and moderation.
Cash Bonus
The Committee establishes a median potential bonus for each
executive by using the market data on total cash compensation
from the same executive compensation surveys as used to determine
salaries. Specifically, the median potential bonus plus the
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salary of an executive officer is approximately equal to the
mid-point of competitive total cash compensation for a similar
position and level of responsibility in businesses having
comparable sales and complexity to the Corporation. The actual
bonus awarded to an executive officer may range from zero to
three times the median potential bonus. The value within the
range (the bonus multiplier) is determined at the end of each
year by the Committee in its discretion. The Committee exercises
its discretion by evaluating each executive's performance using a
methodology developed by its parent corporation, Thermo Electron,
and applied throughout the Thermo Electron organization. The
methodology incorporates measures of operating returns, designed
to measure profitability and contributions to shareholder value
and are measures of corporate and divisional performance that are
evaluated using graphs developed by Thermo Electron intended to
reward performance that is perceived as above average and to
penalize performance that is perceived as below average. The
measures of operating returns used in the Committee's
determinations in calendar 1996 measured return on net assets,
growth in income, and return on sales and the Committee's
determinations also included a subjective evaluation of the
contributions of each executive that are not captured by
operating measures but are considered important to the creation
of long-term value for the Stockholders. These measures of
achievements are not financial targets that are met, not met or
exceeded. The relative weighting of the operating measures and
subjective evaluation varies among the executives, depending on
their roles and responsibilities within the organization.
Stock Option Program
The primary goal of the Corporation is to excel in the
creation of long-term value for the Stockholders. The principal
incentive tool used to achieve this goal is the periodic award to
key employees of options to purchase common stock of the
Corporation and other Thermo Electron companies.
The Committee and management believe that awards of stock
options to purchase the shares of both the Corporation and other
companies within the Thermo Electron group of companies
accomplish many objectives. The grant of options to key employees
encourages equity ownership in the Corporation, and closely
aligns management's interests to the interests of all the
Stockholders. The emphasis on stock options also results in
management's compensation being closely linked to stock
performance. In addition, because they are subject to vesting
periods of varying durations and to forfeiture if the employee
leaves the Corporation prematurely, stock options are an
incentive for key employees to remain with the Corporation
long-term. The Committee believes stock option awards in its
parent companies, Thermo Electron and Thermo Fibertek, and the
other majority-owned subsidiaries of Thermo Electron and Thermo
Fibertek, are an important tool in providing incentives for
performance within the entire organization.
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<PAGE>
In determining awards, the Committee considers the average
annual value of all options to purchase shares of the Corporation
and other companies within the Thermo Electron organization that
vest in the next five years. (Values are established using a
modified Black-Scholes option pricing model.) As a guideline, the
Committee strives to maintain the aggregate amount of net awards
to purchase shares of Common Stock to all employees over a
five-year period below 12% of the Corporation's outstanding
common stock, although other factors such as unusual transactions
and acquisitions and standards for awards of comparably situated
companies may affect the number of awards granted.
Awards are not made annually in conjunction with the annual
review of cash compensation, but are made periodically. The
Committee considers total compensation of executives, actual and
anticipated contributions of each executive (which includes a
subjective assessment by the Committee of the value of the
executive's future potential within the organization), as well as
the value of previously awarded options, as described above, in
determining awards.
Policy on Deductibility of Compensation
The Committee has also considered the application of Section
162(m) of the Internal Revenue Code to the Corporation's
compensation practices. Section 162(m) limits the tax deduction
available to public companies for annual compensation paid to
senior executives in excess of $1 million unless the compensation
qualifies as "performance based" or is otherwise exempt under
Section 162(m). The annual compensation paid to individual
executives does not approach the $1 million threshold, and it is
believed that stock incentive plans of the Corporation qualify as
"performance based." Therefore, the Committee does not believe
any further action is necessary in order to comply with Section
162(m). From time to time, the Committee will reexamine the
Corporation's compensation practices and the effect of Section
162(m).
Stock Ownership Policies
During 1997, the Committee established a stock holding
policy for executive officers of the Corporation. The stock
holding policy specifies an appropriate level of ownership of the
Corporation's Common Stock as a multiple of the officer's
compensation. For the chief executive officer, the multiple is
one times his base salary and reference bonus for the calendar
year. For all other officers, the multiple is one times the
officer's base salary. The Committee deemed it appropriate to
permit officers to achieve these ownership levels over a
three-year period.
In order to assist officers in complying with the policy,
the Committee also adopted a stock holding assistance plan under
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<PAGE>
which the Corporation is authorized to make interest-free loans
to officers to enable them to purchase shares of the Common Stock
in the open market. The loans are required to be repaid upon the
earlier of demand or the fifth anniversary of the date of the
loan, unless otherwise authorized by the Committee.
The Committee also adopted a policy requiring its executive
officers to hold shares of the Corporation's Common Stock
acquired upon the exercise of stock options granted by the
Corporation. Under this policy, executive officers are required
to hold one-half of their net option exercises over a period of
five years. The net option exercise is determined by calculating
the number of shares acquired upon exercise of a stock option,
after deducting the number of shares that could have been traded
to exercise the option and the number of shares that could have
been surrendered to satisfy tax withholding obligations
attributable to the exercise of the options.
1996 CEO Compensation
The salary and bonus of Dr. Monovoukas are established using
the same criteria as described above for all officers. In
determining Dr. Monovoukas' compensation as reported, the
Committee considered among other factors, his contributions and
achievement since successfully completing the initial public
offering of the Corporation's Common Stock in September 1996.
The Committee awarded to Dr. Monovoukas options to purchase
80,000 shares of the Common Stock in fiscal 1996. This award was
determined in a manner consistent with awards to other officers,
as described above.
In addition to stock option awards by the Committee, Dr.
Monovoukas may receive awards to purchase shares of the common
stock of Thermo Electron or any of its majority-owned
subsidiaries from time to time as part of Thermo Electron's stock
option program due to his position as a chief executive officer
of a majority-owned subsidiary of Thermo Electron. These awards
are determined using an analysis similar to that used by the
Committee as described above under "Stock Option Program." The
stock option awards to Dr. Monovoukas in fiscal 1996 with respect
to shares of the following companies were awarded under this
program: Thermo BioAnalysis Corporation, Thermo Fibertek Inc.,
ThermoLyte Corporation, Thermo Optek Corporation, ThermoQuest
Corporation, Thermo Sentron Inc. and Trex Medical Corporation.
The award to purchase shares of common stock of Thermo Electron
granted to Dr. Monovoukas in fiscal 1996 was made by the Thermo
Electron human resources committee under a program which awards
options to certain eligible employees annually based on the
number of shares of the common stock of Thermo Electron held by
the employee, as an incentive to buy and hold Thermo Electron
shares.
Anne T. Barrett
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COMPARATIVE PERFORMANCE GRAPH
The Securities and Exchange Commission requires that the
Corporation include in this Proxy Statement a line-graph
presentation comparing cumulative, five-year shareholder returns
for the Corporation's Common Stock with a broad-based market
index and either a nationally recognized industry standard or an
index of peer companies selected by the Corporation. The
Corporation's Common Stock has been publicly traded since
September 13, 1996 and, as a result, the following graph
commences as of such date. The Corporation has compared its
performance with the American Stock Exchange Market Value Index
and the Dow Jones Total Return Index for the Paper Products
Industry Group.
Comparison of Total Return Among Thermo Fibergen Inc.,
the American Stock Exchange Market Value Index and the Dow Jones
Total Return Index for the Paper Products Industry Group from
September 13, 1996 to December 27, 1996.
GRAPH APPEARS HERE
09/13/96 12/17/96
TFG 100 73
AMEX 100 102
DJ Paper 100 97
The total return for the Corporation's Common Stock (TFG),
the American Stock Exchange Market Value Index (AMEX) and the Dow
Jones Total Return Index for the Paper Products Industry Group
(DJ Paper) assumes the reinvestment of dividends, although
dividends have not been declared on the Corporation's Common
Stock. The American Stock Exchange Market Value Index tracks the
aggregate performance of equity securities of companies listed on
the American Stock Exchange. The Corporation's Common Stock is
traded on the American Stock Exchange under the ticker symbol
"TFG."
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RELATIONSHIP WITH AFFILIATES
Thermo Electron has adopted a strategy of selling a minority
interest in subsidiary companies to outside investors as an
important tool in its future development. As part of this
strategy, Thermo Electron and certain of its subsidiaries have
created several privately and publicly held subsidiaries, and
Thermo Fibertek has created the Corporation as a publicly held,
majority-owned subsidiary. From time to time, Thermo Electron
and its subsidiaries will create other majority-owned
subsidiaries as part of its spinout strategy. (The Corporation
and such other majority-owned Thermo Electron subsidiaries are
hereinafter referred to as the "Thermo Subsidiaries.")
Thermo Electron and each of the Thermo Subsidiaries
recognize that the benefits and support that derive from their
affiliation are essential elements of their individual
performance. Accordingly, Thermo Electron and each of the Thermo
Subsidiaries have adopted the Thermo Electron Corporate Charter
(the "Charter") to define the relationships and delineate the
nature of such cooperation among themselves. The purpose of the
Charter is to ensure that (1) all of the companies and their
stockholders are treated consistently and fairly, (2) the scope
and nature of the cooperation among the companies, and each
company's responsibilities, are adequately defined, (3) each
company has access to the combined resources and financial,
managerial and technological strengths of the others, and (4)
Thermo Electron and the Thermo Subsidiaries, in the aggregate,
are able to obtain the most favorable terms from outside parties.
To achieve these ends, the Charter identifies the general
principles to be followed by the companies, addresses the role
and responsibilities of the management of each company, provides
for the sharing of group resources by the companies and provides
for centralized administrative, banking and credit services to be
performed by Thermo Electron. The services provided by Thermo
Electron include collecting and managing cash generated by
members, coordinating the access of Thermo Electron and the
Thermo Subsidiaries (the "Thermo Group") to external financing
sources, ensuring compliance with external financial covenants
and internal financial policies, assisting in the formulation of
long-range planning and providing other banking and credit
services. Pursuant to the Charter, Thermo Electron may also
provide guarantees of debt or other obligations of the Thermo
Subsidiaries or may obtain external financing at the parent level
for the benefit of the Thermo Subsidiaries. In certain instances,
the Thermo Subsidiaries may provide credit support to, or on
behalf of, the consolidated entity or may obtain financing
directly from external financing sources. Under the Charter,
Thermo Electron is responsible for determining that the Thermo
Group remains in compliance with all covenants imposed by
external financing sources, including covenants related to
borrowings of Thermo Electron or other members of the Thermo
Group, and for apportioning such constraints within the Thermo
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<PAGE>
Group. In addition, Thermo Electron establishes certain internal
policies and procedures applicable to members of the Thermo
Group. The cost of the services provided by Thermo Electron to
the Thermo Subsidiaries is covered under existing corporate
services agreements between Thermo Electron and each of the
Thermo Subsidiaries.
The Charter presently provides that it shall continue in
effect so long as Thermo Electron and at least one Thermo
Subsidiary participate. The Charter may be amended at any time by
agreement of the participants. Any Thermo Subsidiary, including
the Corporation, can withdraw from participation in the Charter
upon 30 days' prior notice. In addition, Thermo Electron may
terminate a subsidiary's participation in the Charter in the
event the subsidiary ceases to be controlled by Thermo Electron
or ceases to comply with the Charter or the policies and
procedures applicable to the Thermo Group. A withdrawal from the
Charter automatically terminates the corporate services agreement
and tax allocation agreement (if any) in effect between the
withdrawing company and Thermo Electron. The withdrawal from
participation does not terminate outstanding commitments to third
parties made by the withdrawing company, or by Thermo Electron or
other members of the Thermo Group, prior to the withdrawal.
However, a withdrawing company is required to continue to comply
with all policies and procedures applicable to the Thermo Group
and to provide certain administrative functions mandated by
Thermo Electron so long as the withdrawing company is controlled
by or affiliated with Thermo Electron.
As provided in the Charter, the Corporation and Thermo
Electron have entered into a Corporate Services Agreement (the
"Services Agreement") under which Thermo Electron's corporate
staff provides certain administrative services, including certain
legal advice and services, risk management, employee benefit
administration, tax advice and preparation of tax returns,
centralized cash management and financial and other services to
the Corporation. The Corporation was assessed an annual fee equal
to 1.0% of the Corporation's revenues for these services for
fiscal 1996. The fee is reviewed annually and may be changed by
mutual agreement of the Corporation and Thermo Electron. During
fiscal 1996, Thermo Electron assessed the Corporation $22,000 in
fees under the Services Agreement. Management believes that the
charges under the Services Agreement are reasonable and that the
terms of the Services Agreement are fair to the Corporation. For
items such as employee benefit plans, insurance coverage and
other identifiable costs, Thermo Electron charges the Corporation
based on charges attributable to the Corporation. The Services
Agreement automatically renews for successive one-year terms,
unless canceled by the Corporation upon 30 days' prior notice. In
addition, the Services Agreement terminates automatically in the
event the Corporation ceases to be a member of the Thermo Group
or ceases to be a participant in the Charter. In the event of a
termination of the Services Agreement, the Corporation will be
required to pay a termination fee equal to the fee that was paid
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by the Corporation for services under the Services Agreement for
the nine-month period prior to termination. Following
termination, Thermo Electron may provide certain administrative
services on an as-requested basis by the Corporation or as
required in order to meet the Corporation's obligations under
Thermo Electron's policies and procedures. Thermo Electron will
charge the Corporation a fee equal to the market rate for
comparable services if such services are provided to the
Corporation following termination.
From time to time, the Corporation may transact business
with other companies in the Thermo Group. In fiscal 1996, these
transactions included the following.
In July 1996, the Corporation entered into a supply and
license agreement with Thermo Fibertek in which Thermo Fibertek
granted to the Corporation a worldwide, royalty-free license to
use Thermo Fibertek's proprietary fiber "scalping" technology in
the pulp and paper industries. The agreement has an initial
term of eight years and is subject to annual renewals thereafter,
unless either party elects not to renew the agreement. The
Corporation's rights under the agreement are exclusive for a
period of at least five years and such exclusivity will continue
thereafter if the Corporation has purchased at least 35 scalping
units from Thermo Fibertek within the first five years of the
license and at least five such units in each subsequent year.
The agreement also provides that Thermo Fibertek will be the
exclusive manufacturer of products based on the licensed
technology. The purchase price to be paid by the Corporation to
Thermo Fibertek for these products will be based on Thermo
Fibertek's manufacturing cost plus a gross profit margin of 55%.
Thermo Fibertek has agreed not to sell these components or any
other technology or products proprietary to Thermo Fibertek for
use in competition with the Corporation in the pulp and paper
industries.
As of December 28, 1996, $58,366,000 of the Corporation's
equivalents were invested in a repurchase agreement with Thermo
Electron. Under this agreement, the Corporation in effect lends
excess cash to Thermo Electron, which Thermo Electron
collateralizes with investments principally consisting of
corporate notes, United States government agency securities,
money market funds, commercial paper and other marketable
securities, in the amount of at least 103% of such obligation.
The Corporation's funds subject to the repurchase agreement will
be readily convertible into cash by the Corporation and have an
original maturity of three months or less. The repurchase
agreement earns a rate based on the 90-day Commercial Paper
Composite Rate plus 25 basis points, set at the beginning of each
quarter.
From time to time, the Corporation may transact business in
the ordinary course with other companies in the Thermo Group.
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Stock Holding Assistance Plan
In 1997, the Corporation adopted a stock holding policy
which requires its executive officers to acquire and hold a
minimum number of shares of Common Stock. In order to assist the
executive officers in complying with the policy, the Corporation
also adopted a stock holding assistance plan under which it may
make interest-free loans to certain key employees, including its
executive officers, to enable these individuals to purchase
Common Stock in the open market. Loans will be repayable upon
the earlier of demand or the fifth anniversary of the date of the
loan, unless otherwise authorized by the Human Resources
Committee of the Corporation's Board of Directors. No such loans
were outstanding in 1996.
APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed Arthur Andersen LLP as
independent public accountants for fiscal 1997. Arthur Andersen
LLP has acted as independent public accountants for the
Corporation since its inception in 1996. Representatives of that
firm are expected to be present at the Meeting, will have the
opportunity to make a statement if they desire to do so and will
be available to respond to questions. The Board of Directors has
established an Audit Committee, presently consisting of two
outside directors, the purpose of which is to review the scope
and results of the audit.
OTHER ACTION
Management is not aware at this time of any other matters
that will be presented for action at the Meeting. Should any such
matters be presented, the proxies grant power to the proxy
holders to vote shares represented by the proxies in the
discretion of such proxy holders.
STOCKHOLDER PROPOSALS
Proposals of Stockholders intended to be presented at the
1998 Annual Meeting of the Stockholders of the Corporation must
be received by the Corporation for inclusion in the proxy
statement and form of proxy relating to that Meeting no later
than January 2, 1998.
SOLICITATION STATEMENT
The cost of this solicitation of proxies will be borne by
the Corporation. Solicitation will be made primarily by mail, but
regular employees of the Corporation may solicit proxies
personally, by telephone, facsimile transmission or telegram.
Brokers, nominees, custodians and fiduciaries are requested to
forward solicitation materials to obtain voting instructions from
beneficial owners of stock registered in their names, and the
Corporation will reimburse such parties for their reasonable
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charges and expenses in connection therewith.
Bedford, Massachusetts
April 29, 1997
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FORM OF PROXY
THERMO FIBERGEN INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD JUNE 2, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints John N. Hatsopoulos, Yiannis
A. Monovoukas and Jonathan W. Painter, or any one of them in the
absence of the others, as attorneys and proxies of the
undersigned, with full power of substitution, for and in the name
of the undersigned, to represent the undersigned at the Annual
Meeting of the Stockholders of Thermo Fibergen Inc., a Delaware
corporation (the "Company"), to be held on Monday, June 2, 1997,
at 8:00 a.m. at The Hyatt Regency Hotel, Hilton Head, South
Carolina, and at any adjournment or postponement thereof, and to
vote all shares of common stock of the Company standing in the
name of the undersigned on April 7, 1997, with all of the powers
the undersigned would possess if personally present at such
meeting:
(IMPORTANT - TO BE SIGNED AND DATED ON THE REVERSE SIDE.)
Please mark your
[ x ] votes as in this
example.
1. ELECTION OF DIRECTORS OF THE COMPANY (see reverse).
FOR [ ] WITHHELD [ ]
______________________________________
FOR all nominees listed at right, except authority to vote
withheld for the following nominees (if any)
Nominees: Anne T. Barrett, Francis L. McKone, Yiannis A.
Moonovoukas, Jonathan W. Painter and William A. Rainville.
2. In their discretion on such other matters as may properly
come before the Meeting.
The shares represented by this Proxy will be voted "FOR" the
proposals set forth above if no instruction to the contrary is
indicated or if no instruction is given.
Copies of the Notice of Meeting and of the Proxy Statement have
been received by the undersigned.
SIGNATURE(S)_______________________________________
DATE_________________
Note: This proxy should be dated, signed by the shareholder(s)
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exactly as his or her name appears hereon, and returned
promptly in the enclosed envelope. Persons signing in a
fiduciary capacity should so indicate. If shares are held
by joint tenants or as community property, both should sign.
27
