<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 /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 Section240.14a-11(c) or
Section240.14a-12
SPLASH TECHNOLOGY HOLDINGS, 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>
SPLASH TECHNOLOGY HOLDINGS, INC.
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD WEDNESDAY, MAY 24, 2000
------------------------
TO THE STOCKHOLDERS OF
SPLASH TECHNOLOGY HOLDINGS, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Splash
Technology Holdings, Inc., a Delaware corporation (the "Company"), will be held
on Wednesday, May 24, 2000 at 9:00 a.m., local time, at the offices of the
Company at 555 Del Rey Avenue, Sunnyvale, California 94086 for the following
purposes:
1. To elect two Class I directors to serve for three year terms expiring
upon the Meeting of Stockholders in 2003 or until their successors are
elected;
2. To transact such other business as may properly come before the meeting
and any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on Monday, April 17,
2000 are entitled to notice of and to vote at the meeting and any adjournment
thereof.
All stockholders are cordially invited to attend the meeting in person.
However, to ensure your representation at the meeting, you are urged to mark,
sign, date and return the enclosed proxy card as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. Any stockholder attending
the meeting may vote in person even if such stockholder has returned a proxy.
THE BOARD OF DIRECTORS
Sunnyvale, California
April 25, 2000
IMPORTANT: Whether or not you plan to attend the meeting, you are requested
to complete and promptly return the enclosed proxy in the envelope provided.
<PAGE>
SPLASH TECHNOLOGY HOLDINGS, INC.
----------------
PROXY STATEMENT
INFORMATION CONCERNING SOLICITATION AND VOTING
------------------------
GENERAL
The enclosed Proxy is solicited on behalf of the Board of Directors of
Splash Technology Holdings, Inc. (the "Company") for use at the Annual Meeting
of Stockholders to be held on Wednesday, May 24, 2000 at 9:00 a.m., local time,
or at any adjournment thereof, for the purposes set forth herein and in the
accompanying Notice of Annual Meeting of Stockholders. The Annual Meeting will
be held at the offices of the Company at 555 Del Rey Avenue, Sunnyvale,
California 94086. The telephone number of the Company's offices is
(408) 328-6300.
These proxy solicitation materials and the Company's Annual Report to
Stockholders for the year ended December 31, 1999, including financial
statements, were mailed on or about May 1, 2000 to all stockholders entitled to
vote at the meeting.
RECORD DATE AND VOTING SECURITIES
Stockholders of record at the close of business on Monday, April 17, 2000
(the "Record Date") are entitled to notice of and to vote at the meeting. At the
Record Date, 14,146,946 shares of the Company's Common Stock, $0.001 par value,
were issued and outstanding.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Secretary of the
Company a written notice of revocation or a duly executed proxy bearing a later
date or by attending the meeting and voting in person.
VOTING AND SOLICITATION
Each stockholder is entitled to one vote for each share of Common Stock on
all matters presented at the Annual Meeting. Stockholders do not have the right
to cumulative voting in the election of directors.
The Company will bear the cost of soliciting proxies. In addition, the
Company may reimburse brokerage firms and other persons representing beneficial
owners of shares for their expenses in forwarding solicitation materials to such
beneficial owners. Solicitation of proxies by mail may be supplemented by
telephone, telegram, facsimile or personal solicitation by directors, officers
or regular employees of the Company. No additional compensation will be paid to
such persons for such services.
QUORUM; ABSTENTIONS; BROKER NON-VOTES
The required quorum for the transaction of business at the Annual Meeting is
a majority of the votes eligible to be cast by holders of shares of Common Stock
issued and outstanding on the Record Date. Shares that are voted "FOR,"
"AGAINST," "WITHHELD" or "ABSTAIN" are treated as being present at the meeting
for purposes of establishing a quorum and are also treated as shares entitled to
vote at the Annual Meeting (the "Votes Cast") with respect to such matter.
1
<PAGE>
Although there is no definitive statutory or case law authority in Delaware
as to the proper treatment of abstentions, the Company believes that abstentions
should be counted for purposes of determining both (i) the presence or absence
of a quorum for the transaction of business and (ii) the total number of Votes
Cast with respect to a proposal (other than the election of directors). In the
absence of controlling precedent to the contrary, the Company intends to treat
abstentions in this manner. Accordingly, abstentions will have the same effect
as a vote against the proposal.
The Delaware Supreme Court has held that, while broker non-votes should be
counted for purposes of determining the presence or absence of a quorum for the
transaction of business, broker non-votes should not be counted for purposes of
determining the number of Votes Cast with respect to the particular proposal on
which the broker has expressly not voted. The Company intends to treat broker
non-votes in a manner consistent with such holding. Thus, a broker non-vote will
not affect the outcome of the voting on a proposal.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company which are intended to be presented
by such stockholders at the Company's 2001 Annual Meeting must be received by
the Company no later than January 3, 2001 in order that they may be considered
for inclusion in the proxy statement and form of proxy relating to that meeting.
The attached proxy card grants the proxy holders discretionary authority to
vote on any matter raised at the meeting. If a stockholder intends to submit a
proposal at the next annual meeting of stockholders which is not eligible for
inclusion in the proxy statement relating to that meeting, the stockholder must
give notice to Splash in accordance with the requirements set forth in the
Securities Exchange Act of 1934, as amended, no later than March 17, 2001. If a
stockholder does not comply with the foregoing notice provision, the proxy
holders will be allowed to use their discretionary voting authority when and if
the proposal is raised at the next annual meeting of stockholders.
PROPOSAL ONE:
ELECTION OF DIRECTORS
NOMINEES
The number of directors authorized by the Company's Bylaws is currently
fixed by the Board at six. The Company's Amended and Restated Certificate of
Incorporation provides that the directors shall be divided into three classes,
with the classes serving for staggered, three year terms. Currently there are
two directors in each of the three classes.
Two Class I directors are to be elected at the Annual Meeting. The Class I
directors elected at the Annual Meeting will hold office until the Annual
Meeting of Stockholders in 2003 or until their successors have been duly elected
and qualified. The term of the Class II director will expire at the Annual
Meeting of Stockholders in 2001. The term of each Class III director will expire
at the Annual Meeting of Stockholders in 2002.
Unless otherwise instructed, the proxy holders will vote the proxies
received by them for the Company's two nominees named below, who are currently
directors of the Company. In the event that either nominee of the Company
becomes unable or declines to serve as a director at the time of the Annual
Meeting, the proxy holders will vote the proxies for any substitute nominee who
is designated by the current Board of Directors to fill the vacancy. It is not
expected that either nominee listed below will be unable or will decline to
serve as a director.
2
<PAGE>
The names of the two Class I nominees for director and certain information
about them are set forth below. The names of, and certain information about, the
current Class II and Class III directors with unexpired terms are also set forth
below.
<TABLE>
<CAPTION>
NAME AGE PRINCIPAL OCCUPATION
- ---- -------- ------------------------------------------------
<S> <C> <C>
NOMINEES FOR CLASS I DIRECTORS
Mark Hill.................................... 39 Chief Executive Officer, Done.com
Peter Y. Chung............................... 32 General Partner, Summit Partners, L.P.
CONTINUING CLASS II DIRECTORS
Charles W. Berger............................ 46 Chairman and Chief Executive Officer,
AdForce, Inc.
Jan L. Gullett............................... 46 President and Chief Executive Officer, WebSwap
CONTINUING CLASS III DIRECTORS
Kevin K. Macgillivray........................ 41 Chairman and Chief Executive Officer,
Splash Technology Holdings, Inc.
Greg M. Avis................................. 41 Managing Partner, Summit Partners, L.P.
</TABLE>
Except as indicated below, each nominee or incumbent director has been
engaged in the principal occupation set forth above during the past five years.
There are no family relationships between any directors or executive officers of
the Company.
Mark Hill has been a director of the Company since April 2000. Mr. Hill
serves as chief executive officer of Done.com. Mr. Hill served as vice president
and general manager of Xerox Corporation from 1992 until 1999. From 1989 until
1992 he served as a consultant for Bain & Company. Mr. Hill holds an MBA from
Harvard Business School and a BA from Harvard College.
Peter Y. Chung has been a director of the Company since its formation in
December 1995. Mr. Chung has served as a general partner at Summit Partners,
L.P., a venture capital partnership, since December 1997. From December 1996 to
December 1997, Mr. Chung served as a vice president at Summit Partners, L.P.
From August 1994 to December 1996, Mr. Chung served as a senior associate at
Summit Partners, L.P. From August 1989 to July 1992, Mr. Chung was employed by
Goldman, Sachs & Co., an investment banking firm.
Charles W. Berger has been a director of the Company since January 1996.
Mr. Berger has been chairman and chief executive officer of AdForce, Inc. since
July 1997. Mr. Berger has also been a director of Radius Inc. since March 1994
and was chief executive officer for Radius Inc. from March 1993 until
July 1997. From April 1992 until he joined Radius Inc., Mr. Berger was senior
vice president, worldwide sales, operations and support for Claris Corporation,
a software subsidiary of Apple Computer, Inc., a personal computer manufacturer,
that develops and markets application software. From March 1989 to April 1992,
Mr. Berger held various executive positions at Sun Microsystems, Inc. and its
subsidiaries.
Jan Gullett has been a director of the Company since April 2000.
Mr. Gullett joined WebSwap in 1998 and serves as chief executive officer and
president. Mr. Gullett joined Procter & Gamble in 1977 in brand management. From
1982 to 1991 Mr. Gullett served in various capacities at Sara Lee Corporation,
including executive director of mergers and acquisitions, vice president of
sales, and division general manager. Mr. Gullett joined PepsiCo in 1991 where he
served in several posts, including vice president and general manager.
Mr. Gullett joined Broderbund Software in 1995 and served as senior vice
president. He also served as chief executive officer and president of PlanetWeb,
a developer of Internet software. Mr. Gullett holds an MBA from Harvard Business
School and a BA from Miami University.
Kevin K. Macgillivray has served as chairman, chief executive officer, and
director of the Company since January 1996. From April 1995 until January 1996,
Mr. Macgillivray was vice president and general manager of the Publishing
Division of Radius Inc., a manufacturer of computer video cards and display
products. From May 1993 to April 1995, Mr. Macgillivray held other managerial
positions within
3
<PAGE>
Radius Inc. and SuperMac Technology, Inc., which merged into Radius Inc. in
1994. From May 1991 to May 1993, Mr. Macgillivray was vice president and general
manager of Oce Graphics USA, a computer peripherals manufacturer.
Gregory M. Avis has been a director of the Company since its formation in
December 1995. Mr. Avis has served as a general partner of Summit Partners,
L.P., a venture capital partnership, since 1987 and has served as a managing
partner of Summit Partners, L.P. since 1990. Mr. Avis is also a director of
Ditech Communications, MCK Communications, and several privately held companies.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of seven (7) meetings
from January 1, 1999 through December 31, 1999. During Fiscal 1999, no director
attended fewer than seventy-five percent (75%) of the meetings of the Board of
Directors with the exception of Greg Avis, who attended seventy-one percent
(71%) of the meetings of the Board of Directors.
The Board of Directors established an Audit Committee and a Compensation
Committee in connection with the Company's initial public offering in
October 1996. The Board of Directors has no nominating committee or any
committee performing similar functions.
The Audit Committee currently consists of Directors Chung and Berger. The
Audit Committee aids management in the establishment and supervision of the
Company's financial controls, evaluates the scope of the annual audit, reviews
audit results, consults with management and the Company's independent auditors
prior to the presentation of financial statements to stockholders and, as
appropriate, initiates inquiries into aspects of the Company's financial
affairs. The Audit Committee held 4 meetings in 1999.
The Compensation Committee currently consists of Directors Avis and Berger.
The Compensation Committee makes recommendations to the Board concerning
salaries and incentive compensation for the Company's officers and employees and
administers the Company's 1996 Stock Option Plan and 1996 Employee Stock
Purchase Plan. The Compensation Committee held 3 meetings in 1999.
COMPENSATION OF OUTSIDE DIRECTORS
Employee directors receive no cash remuneration for serving on the Board of
Directors, although all directors are reimbursed for all reasonable expenses
incurred by them in attending Board and Committee meetings. Effective
April 2000, outside directors (as defined below) are granted an annual cash
retainer of $10,000 and an additional $1,000 for each Board Meeting attended.
Outside directors are also eligible to receive stock options under the 1996
Stock Option Plan and are automatically granted fully vested options, on a
quarterly basis, to purchase 1,250 shares of Company Common Stock. In addition,
each outside board member will receive an initial grant of options to purchase
5,000 shares of Company Common Stock under the 1996 Stock Option Plan which vest
over three years. An "outside director" is a director who is (i) not an employee
of the Company and (ii) not a partner nor a member of any venture capital firm
or institutional investor which owns securities of the Company having more than
five percent (5%) of the total voting power of the Company.
VOTE REQUIRED
The two nominees receiving the highest number of affirmative votes of the
shares entitled to vote on this matter shall be elected as the Class I
directors. Votes withheld from the directors will be counted for purposes of
determining the presence or absence of a quorum but are not counted as
affirmative votes. A broker non-vote will be counted for purposes of determining
the presence or absence of a quorum but will have no other legal effect upon the
election of the director.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS VOTING "FOR" THE NOMINEES SET
FORTH ABOVE.
4
<PAGE>
ADDITIONAL INFORMATION
EXECUTIVE COMPENSATION
The following table sets forth a summary of the compensation paid by the
Company for the years ended December 31, 1997, 1998, and 1999, to the Company's
Chief Executive Officer and the Company's three other most highly compensated
executive officers (collectively, the "Named Executive Officers") for services
rendered in all capacities to the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------------ ------------
OTHER SECURITIES
INCENTIVE ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY(1) BONUS COMPENSATION OPTIONS(2) COMPENSATION
- --------------------------- -------- --------- --------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Kevin K. Macgillivray ...... 1999 $270,000 -- -- -- $ 3,191(3)
Chairman and Chief 1998 257,537 $ 81,400 -- 72,000(6) 4,389(3)
Executive Officer 1997 180,577 176,940 -- 90,000 1,483(3)
88,373(4)
Joan P. Platt(5) ........... 1999 66,205 10,000 -- -- 1,033(3)
Vice President, Finance 1998 174,017 29,700 -- 44,000(6) 3,529(3)
and Admin and Chief 1997 143,462 66,849 -- 55,000 1,268(3)
Financial Officer 18,133(4)
Michael Orr(5) ............. 1999 147,957 40,000 -- -- 834(3)
Vice President, Sales and 1998 123,720 105,000 -- 90,000 803(3)
Marketing 72,000(6)
Douglas Bender(5)........... 1999 132,904 32,760 -- 90,000 --
</TABLE>
- ------------------------
(1) Includes compensation deferred by the employee under the Company's
retirement plans.
(2) Consists of options to purchase shares of the Company's Common Stock under
the Company's 1996 Stock Option Plan.
(3) Consists of the vesting of contributions made by the Company under its
qualified 401(k) retirement plan.
(4) Consists of reimbursement for underwriting fees paid by the Named Executive
Officer (including taxes payable in respect thereof) in connection with the
follow-on offering of the Company's Common Stock on August 25, 1997.
(5) Left the Company in 1999.
(6) Represents options issued in October, 1998 in a four for five exchange for
options previously granted (pursuant to an option repricing).
OPTION GRANTS AND EXERCISES
The following table sets forth certain information with respect to stock
option grants during Fiscal 1999 to the Named Executive Officers. In accordance
with the rules of the Securities and Exchange Commission, also shown below is
the potential realizable value over the term of the option (the period from the
grant date to the expiration date) based on assumed rates of stock appreciation
from the option exercise price of 5% and 10%, compounded annually. These amounts
are based on certain assumed rates
5
<PAGE>
of appreciation and do not represent the Company's estimate of future stock
price. Actual gains, if any, on stock option exercises will be dependent on the
future performance of the Common Stock.
In October 1998, partially in response to the repricing of the Company's
stock options, the Company's Board of Director froze executive salaries and
incentive plan bases for 1999 and eliminated certain executive option grants.
OPTION GRANTS IN 1999
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
----------------------------------------------------- ANNUAL RATES
NUMBER OF PERCENT OF OF STOCK PRICE
SECURITIES TOTAL OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO OPTION TERM
OPTIONS EMPLOYEES IN EXERCISE OF EXPIRATION ---------------------
NAME GRANTED FISCAL YEAR BASE PRICE DATE 5% 10%
- ---- ---------- ------------- ----------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Kevin K. Macgillivray........... -- -- -- -- -- --
Joan P. Platt................... -- -- -- -- -- --
Michael Orr..................... -- -- -- -- -- --
Douglas Bender(1)............... 90,000 21% 6.969 2/8/08 394,449 999,611
</TABLE>
- ------------------------
(1) Mr. Bender left the Company in October of 1999. As a result, only 22,500 of
his options were vested.
The following table sets forth information with respect to options exercised
during Fiscal 1999 by the Named Executive Officers and the value of unexercised
options at December 31, 1999.
AGGREGATE OPTION EXERCISES IN 1999 AND YEAR-END VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
SHARES UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS
ACQUIRED DECEMBER 31, 1999 AT DECEMBER 31, 1999(1)
ON VALUE --------------------------- ---------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- -------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Kevin K. Macgillivray......... -- -- 72,000 -- $36,000 --
Joan Platt.................... -- -- -- -- -- --
Michael Orr................... -- -- -- -- -- --
Douglas Bender................ -- -- 22,500 -- $41,400 --
</TABLE>
- ------------------------
(1) Based on December 31, 1999 closing price of $8.81.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
The Company currently has no employment contract in effect with its Chief
Executive Officer or any other Named Executive Officer.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During Fiscal 1999 the Compensation Committee of the Board of Directors
consisted of Messrs. Avis and Berger. Neither of these individuals were at any
time since the formation of the Company an officer or employee of the Company.
No executive officer of the Company serves as a member of the board of directors
or compensation committee of any entity that has one or more executive officers
serving as a member of the Company's Board of Directors or Compensation
Committee.
6
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The following is the report to the Board of Directors describing
compensation policies and rationales applicable to the Company's executive
officers with respect to compensation paid to such executive officers for Fiscal
1999. The information contained in the following report shall not be deemed to
be "soliciting material" or to be filed with the Securities and Exchange
Commission, nor shall such information be incorporated by reference into any
future filing under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, except to the extent that the Company
specifically incorporates it by reference into such filing.
The Compensation Committee of the Board of Directors is responsible for
reviewing and approving the Company's compensation policies and the compensation
paid to executive officers. The Committee is comprised of the members named
above, none of whom is an employee of the Company.
COMPENSATION PHILOSOPHY
The general philosophy of the Company's compensation program is to offer
executive officers competitive compensation based both on the Company's
performance and on the individual's contribution and performance. The Company's
compensation policies are intended to motivate, reward and retain highly
qualified executives for long-term strategic management and the enhancement of
stockholder value, to support a performance-oriented environment that rewards
achievement of specific internal Company goals and to attract and retain
executives whose abilities are critical to the long-term success and
competitiveness of the Company.
There are four main components in the Company's executive compensation
program:
- Base Salary
- Incentive Bonus
- Stock Incentives
- Deferred Compensation
BASE SALARY
The salaries of the executive officers, including the Chief Executive
Officer, are determined annually by the Compensation Committee with reference to
surveys of salaries paid to executives with similar responsibilities at
comparable companies, generally in the high technology industry. The peer group
for each executive officer is composed of executives whose responsibilities are
similar in scope and content. The Company seeks to set executive compensation
levels that are competitive with the average levels of peer group compensation.
INCENTIVE BONUS
Annual incentive bonuses for executive officers are intended to reflect the
Committee's belief that a significant portion of the annual compensation of each
executive officer should be contingent upon the performance of the Company, as
well as the individual contribution of each officer.
STOCK INCENTIVES
The Company utilizes stock options as long term incentives to reward and
retain executive officers. The Committee believes that this practice links
management interests with stockholder interests and motivates executive officers
to make long-term decisions that are in the best interests of the Company. The
Committee also believes that executive officers and other key employees should
own a significant
7
<PAGE>
percentage of the Company's stock. Generally, stock options vest over four years
after the grant date and optionees must be employed by the Company at the time
of vesting in order to exercise the options.
The Committee believes that stock option grants provide an incentive which
focuses the executives' attention on the Company from the perspective of an
owner with an equity stake in the business. Because options are typically
granted with an exercise price equal to the fair market value of the Common
Stock on the date of grant, the Company's stock options are tied to the future
performance of the Company's Common Stock and will provide value to the
recipient only when the price of the Company's stock increases above the
exercise price, that is, only to the extent that stockholders as a whole have
benefited.
DEFERRED COMPENSATION
In June 1998, the Company established a deferred compensation plan for its
executives. Each executive may voluntarily contribute a portion of their salary
and bonus to the plan. The Company at its discretion may make contributions to
the plan on behalf of its executives. The Company to date has made no
contributions to the plan.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Kevin K. Macgillivray has been the Company's Chairman and Chief Executive
Officer since January 1996. Mr. Macgillivray received no bonus or stock option
grants for 1999.
THE COMPENSATION COMMITTEE
Gregory M. Avis
Charles W. Berger
8
<PAGE>
PERFORMANCE GRAPH
The following line graph compares the cumulative total stockholder return
for the Company's Common Stock with the Nasdaq U.S. Index and the Hambrecht &
Quist Technology Index (the "Peer Group") for the period commencing October 9,
1996 and ending December 31, 1999. The graph assumes that $100 was invested on
the date of the Company's initial public offering, October 9, 1996, and that all
dividends are reinvested. In accordance with the guidelines of the SEC, the
stockholder return for each entity in the Peer Group has been weighted on the
basis of market capitalization as of each measurement date set forth in the
graph. Historic stock price performance should not be considered indicative of
future stock price performance.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN AMONG SPLASH, NASDAQ U.S. INDEX
AND HAMBRECHT & QUIST TECHNOLOGY INDEX
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
SPLASH H & Q NASDAQ SPLASH H & Q NASDAQ
- ------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
11.000 9.29 12.38 10/9/96 100.00% 100.00% 100.00%
21.500 9.96 12.91 12/31/96 195.45% 107.18% 104.28%
25.000 9.49 12.22 3/31/97 227.27% 102.11% 98.68%
36.125 11.41 14.42 6/30/97 328.41% 122.84% 116.49%
39.125 13.29 16.86 9/30/97 355.68% 143.01% 136.16%
22.500 11.65 15.70 12/31/97 204.55% 125.38% 126.85%
16.750 14.10 18.35 3/31/98 152.27% 151.78% 148.22%
17.188 14.43 18.94 6/30/98 156.25% 155.33% 152.99%
14.250 12.82 16.93 9/30/98 129.55% 138.00% 136.75%
7.438 18.09 21.92 12/31/98 67.62% 194.73% 177.06%
6.063 19.71 24.61 3/31/99 55.12% 212.16% 198.79%
7.031 23.33 26.86 6/30/99 63.92% 251.13% 216.96%
6.125 24.66 27.46 9/30/99 55.68% 265.45% 221.81%
8.813 40.35 40.69 12/31/99 80.12% 434.34% 328.68%
</TABLE>
9
<PAGE>
BENEFICIAL OWNERSHIP
The following table sets forth certain information known to the Company with
respect to beneficial ownership of the Company's Common Stock as of April 17,
2000 by (i) each beneficial owner of more than 5% of the Company's Common Stock,
(ii) each director and each nominee, (iii) each Named Executive Officer and
(iv) all directors and executive officers as a group. Except as otherwise
indicated, each person has sole voting and investment power with respect to all
shares shown as beneficially owned, subject to community property laws where
applicable.
<TABLE>
<CAPTION>
PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER OF SHARES TOTAL(1)(2)
- ------------------------------------ ---------------- -----------
<S> <C> <C>
Charles W. Berger(3)(10)(11)................................ 10,000 *
Greg M. Avis(4)............................................. -- 0.0%
Jan Gullett(5)(9)(10)....................................... 6,250 *
Peter Y. Chung(4)........................................... -- 0.0%
Mark Hill(6)(9)(10)......................................... 6,250 *
Kevin K. Macgillivray(7)(8)................................. 344,276 2.4%
Douglas Bender(12).......................................... 22,500 *
Michael Orr(12)............................................. -- 0.0%
Joan P. Platt(12)........................................... -- 0.0%
All directors and executive officers as a group(13)
(9 persons)............................................... 389,276 2.7%
</TABLE>
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* Percentage of shares beneficially owned is less than one percent of total.
(1) Beneficial ownership is determined in accordance with the rules of
Securities and Exchange Commission. In computing the number of shares
beneficially owned by a person and the percentage ownership of that person,
shares of Common Stock subject to options or warrants held by that person
that are currently exercisable or exercisable within 60 days of April 17,
2000 are deemed outstanding. Such shares, however, are not deemed
outstanding for the purposes of computing the percentage ownership of any
other person. Except as indicated in the footnotes to this table and
pursuant to applicable community property laws, each stockholder named in
the table has sole voting and investment power with respect to the shares
set forth opposite such stockholder's name.
(2) Percentage of ownership is based on 14,146,946 shares of Common Stock
outstanding on April 17, 2000.
(3) Such person's address is: c/o AdForce, Inc., 10590 North Tantau Avenue,
Cupertino, CA 95014.
(4) Such person's address is: c/o Summit Partners L.P. Hamilton Avenue
Suite 200, Palo Alto, CA 94301.
(5) Such person's address is: c/o WebSwap, 2585 East Bayshore Road, Palo Alto,
Ca 94303.
(6) Such person's address is: c/o Done.com, 1301 Shoreway Road, Belmont, Ca
94002.
(7) Includes 172,000 shares issuable upon the exercise of options which vest
over four years; such options may be exercised immediately as to all shares,
provided that the unvested shares shall be subject to a right of repurchase
in favor of the Company.
(8) Such person's address is: c/o Splash Technology Holdings, Inc., 555 Del Rey
Avenue, Sunnyvale, CA 94086.
(9) Includes 1,250 shares issuable upon the exercise of options which vested
immediately.
10
<PAGE>
(10) Includes 5,000 shares issuable upon the exercise of options which vest over
three years; such options may be exercised immediately as to all shares,
provided that unvested shares shall be subject to a right of repurchase in
favor of the Company.
(11) Includes 5,000 shares issuable upon the exercise of options which vested
immediately.
(12) Left the Company in 1999.
(13) Includes 7,500 shares issuable upon the exercise of options which vested
immediately. Also included are 194,500, and 15,000 shares issuable upon the
exercise of options which vest over four years and three years,
respectively; such options may be exercised immediately as to all shares,
provided that the unvested shares shall be subject to a right of repurchase
in favor of the Company.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") requires the Company's executive officers and directors and
persons who own more than ten percent of a registered class of the Company's
equity securities to file an initial report of ownership on Form 3 and changes
in ownership on Form 4 or 5 with the Securities and Exchange Commission (the
"SEC") and the National Association of Securities Dealers, Inc. Executive
officers, directors and greater than ten percent stockholders are also required
by SEC rules to furnish the Company with copies of all Section 16(a) forms they
file. Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons, the Company believes
that, with respect to 1999, except for the late filing of a Form Five by Joan P.
Platt in February, all filing requirements applicable to its officers, directors
and ten percent stockholders were complied with.
OTHER MATTERS
The Company knows of no other matters to be submitted at the meeting. If any
other matters properly come before the meeting or any adjournment or
postponement thereof, it is the intention of the persons named in the enclosed
form of Proxy to vote the shares they represent as the Board of Directors may
recommend.
THE BOARD OF DIRECTORS
Sunnyvale, California
April 25, 2000
11
<PAGE>
SPLASH TECHNOLOGY HOLDINGS, INC.
PROXY for Annual Meeting of Stockholders
To Be Held May 24, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of SPLASH TECHNOLOGY HOLDINGS, INC., a
Delaware corporation (the "Company"), hereby acknowledges receipt of the
Notice of Annual Meeting of Stockholders and Proxy Statement, and hereby
appoints Kevin K. Macgillivray and John Ritchie, and each of them, proxies
and attorneys-in-fact, with full power to each of substitution, on behalf of
the undersigned, to represent the undersigned at the Annual Meeting of
Stockholders of SPLASH TECHNOLOGY HOLDINGS, INC. to be held at the offices of
the Company at 555 Del Rey Avenue, Sunnyvale, California 94086 on Wednesday,
May 24, 2000 at 9:00 a.m., local time, and at any adjournment or adjournments
thereof, and to vote all shares of Common Stock that the undersigned would be
entitled to vote if then and there personally present, on all matters set
forth on the reverse side hereof.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATIONS MADE HEREIN. IF NO SPECIFICATION IS INDICATED, THE SHARES
REPRESENTED BY THIS PROXY WILL BE VOTED FOR EACH OF THE PERSONS AND THE
PROPOSALS ON THE REVERSE SIDE HEREOF AND FOR SUCH OTHER MATTERS AS MAY PROPERLY
COME BEFORE THE MEETING AS THE PROXYHOLDERS DEEM ADVISABLE.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
1. Election of Directors NOMINEES: Mark Hill
Peter Y. Chung
FOR WITHHELD
[_] [_]
[_]
---------------------------------------
For both nominees except as noted above
2. To vote or otherwise represent the shares on any and all other business
which may properly come before the meeting or any adjournment or
adjournments thereof, according to their discretion and in their
discretion.
FOR WITHHELD ABSTAIN
[_] [_] [_]
MARK HERE FOR ADDRESS CHANGE AND [_]
NOTE NEW ADDRESS IN SPACE TO THE LEFT.
Please mark, sign, date and return the proxy card promptly using the enclosed
envelope.
NOTE: Please sign exactly as name appears on your stock certificate. If the
stock is registered in the names of two or more persons, each should
sign. Executors, administrators, trustees, guardians, attorneys and
corporate officers should insert their titles.
SIGNATURE: DATE:
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