<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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 Rule 14a-11(c) or Rule 14a-12
ATMI, INC.
(Name of Registrant as Specified in its Charter)
Payment of Filing Fee (Check the appropriate box):
[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:
<PAGE>
ATMI, INC.
7 Commerce Drive
Danbury, Connecticut 06810
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 26, 1999
To Our Stockholders:
The 1999 Annual Meeting of Stockholders of ATMI, Inc. (the "Company") will be
held at the Ethan Allen Inn, 21 Lake Avenue Extension, Danbury, Connecticut
06811 on Wednesday, May 26, 1999 at 10:00 a.m. (local time) for the following
purposes:
1. To elect three directors for terms to expire at the 2002 Annual Meeting of
Stockholders;
2. To ratify the appointment by the Board of Directors of Ernst & Young LLP as
the Company's independent certified auditors for the fiscal year ending
December 31, 1999; and
3. To transact such other business as may properly come before the meeting or
any adjournment or postponement thereof.
Only stockholders of record at the close of business on April 9, 1999 are
entitled to notice of and to vote at the Annual Meeting and any adjournments
thereof.
By order of the Board of Directors,
Ward C. Stevens
Secretary
Dated: April 28, 1999
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE MARK, SIGN, DATE
AND RETURN THE ENCLOSED PROXY PROMPTLY IN THE ENCLOSED POSTAGE PREPAID ENVELOPE.
ANY PERSON GIVING A PROXY HAS THE POWER TO REVOKE IT AT ANY TIME PRIOR TO ITS
EXERCISE AND, IF PRESENT AT THE MEETING, MAY WITHDRAW IT AND VOTE IN PERSON.
<PAGE>
ATMI, INC.
7 COMMERCE DRIVE
DANBURY, CT 06810
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 26, 1999
__________________________
This Proxy Statement is being furnished to the stockholders of ATMI, Inc. (the
"Company") in connection with the solicitation of proxies by the Board of
Directors of the Company for use at the Annual Meeting of Stockholders of the
Company to be held on May 26, 1999, and any adjournments or postponements
thereof (the "1999 Annual Meeting"). This Proxy Statement, the foregoing Notice
of Annual Meeting, the enclosed form of proxy and the Company's 1998 Annual
Report to Stockholders are first being mailed or given to stockholders on or
about April 28, 1999. As used in this Proxy Statement, references to the
"Company" include references to ATMI, Inc. and to its predecessor registrant,
Advanced Technology Materials, Inc.
PROXIES
A stockholder giving a proxy may revoke it at any time before it is voted by
executing and delivering to the Company another proxy bearing a later date, by
delivering a written notice to the Secretary of the Company stating that the
proxy is revoked, or by voting in person at the 1999 Annual Meeting. Any
properly executed proxy returned to the Company will be voted in accordance with
the instructions indicated thereon. If no instructions are indicated on the
proxy, the proxy will be voted for the election of the nominees for directors
named herein and in favor of the other proposal set forth in the Notice of
Annual Meeting.
VOTING SECURITIES
The record date for the determination of stockholders entitled to notice of
and to vote at the 1999 Annual Meeting was the close of business on April 9,
1999 (the "Record Date"). On the Record Date, there were 22,271,057 shares of
Common Stock, the Company's only voting securities, outstanding and entitled to
vote. Each share of Common Stock is entitled to one vote. The presence, in
person or by proxy, of the holders of a majority of the shares of Common Stock
entitled to be voted at the 1999 Annual Meeting is necessary to constitute a
quorum for the transaction of business. Abstentions and broker non-votes will
be included in the calculation of the number of votes represented at the 1999
Annual Meeting for purposes of determining whether a quorum has been achieved.
Votes will be tabulated at the 1999 Annual Meeting by one or more inspectors of
election appointed by the Board of Directors.
<PAGE>
PRINCIPAL STOCKHOLDERS AND STOCK OWNERSHIP OF MANAGEMENT
The following table sets forth certain information known to the Company
regarding the beneficial ownership of the Company's Common Stock as of the
Record Date, by: (i) each person known by the Company to own beneficially more
than five percent of the outstanding Common Stock of the Company; (ii) each
director and nominee for director of the Company; (iii) each executive officer
of the Company named in the Summary Compensation Table on page 6; and (iv) all
directors and executive officers of the Company as a group. Except as otherwise
indicated, all shares are owned directly. Except as indicated by footnote, and
subject to community property laws where applicable, the persons named in the
table have sole voting and investment power with respect to all shares of Common
Stock shown as beneficially owned by them.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES BENEFICIALLY OWNED PERCENT OF CLASS
------------------------------------ ------------------------- ----------------
<S> <C> <C>
Stephen H. Siegele............................... 2,541,305 11.4%
6805 Capital of Texas Highway
Suite 330
Austin, Texas 78731
Lamonte H. Lawrence (1).......................... 2,073,922 9.3%
100 Sir Francis Drake Boulevard
Ross, California 94957
J. P. Morgan & Co. Incorporated (2).............. 1,246,400 5.6%
60 Wall Street
New York, New York 10260
Eugene G. Banucci (3)............................ 347,731 1.6%
Daniel P. Sharkey (4)............................ 96,875 *
Peter S. Kirlin (5).............................. 71,945 *
Robert S. Hillas (6)............................. 45,977 *
Mark A. Adley (7)................................ 31,000 *
Stephen H. Mahle (8)............................. 14,600 *
Douglas J. Neugold (9)........................... 8,246 *
Kam Law.......................................... - *
All directors and executive
officers as a group (10 persons) (10)............ 5,231,601 23.1%
</TABLE>
____________
* Less than 1% of the outstanding Common Stock.
(1) Consists entirely of shares held in a family trust of which Mr. Lawrence is
a trustee and beneficiary.
(2) Based on information provided in Schedule 13G filed with the Securities and
Exchange Commission on February 22, 1999. Such schedule indicates that
J.P. Morgan & Co. Incorporated has sole voting power with respect to
962,400 shares and sole dispositive power with respect to all 1,246,400
shares.
(3) Includes 131,875 shares issuable upon exercise of options that are
exercisable within 60 days of the Record Date and 13,159 shares either
owned or issuable upon exercise of options within 60 days of the Record
Date by Dr. Banucci's spouse. Dr. Banucci disclaims beneficial ownership of
the shares held by his spouse.
(4) Consists entirely of shares issuable upon exercise of options that are
exercisable within 60 days of the Record Date.
(5) Consists entirely of shares issuable upon exercise of options that are
exercisable within 60 days of the Record Date. Does not include 1,829
shares owned by irrevocable trusts for the benefit of Dr. Kirlin's child.
(6) Includes 15,000 shares issuable upon exercise of options that are
exercisable within 60 days of the Record Date.
2
<PAGE>
(7) Includes 28,000 shares issuable upon exercise of options that are
exercisable with 60 days of the Record Date.
(8) Includes 14,500 shares issuable upon exercise of options that are
exercisable within 60 days of the Record Date.
(9) Includes 7,800 shares issuable upon exercise of options that are
exercisable within 60 days of the Record Date.
(10) Includes 379,982 shares issuable to executive officers, directors and their
spouses pursuant to options that are exercisable within 60 days of the
Record Date.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
Company's executive officers and directors and persons who beneficially own more
than ten percent of the Company's Common Stock to file reports of ownership and
changes in ownership with the Securities and Exchange Commission and to furnish
the Company with copies of all such 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 during the fiscal year
ended December 31, 1998, all such reports were timely filed, except that (i) a
Form 4 for Duncan W. Brown, President of the Company's Epitronics division,
reporting the partial exercise of an option and (ii) a Form 4 for Ward C.
Stevens, the Company's Vice President of Administration, reporting the partial
exercise of an option, were filed late.
1. ELECTION OF DIRECTORS
The Board of Directors is classified into three classes. The three directors
serving in Class II have terms expiring at the 1999 Annual Meeting. In March
1999, John A. Armstrong, a Class I director whose term otherwise would have
expired at the 2001 Annual Meeting, retired from the Board of Directors. The
Board appointed Lamonte H. Lawrence, then a Class II director, to fill the
vacancy created by Mr. Armstrong's retirement and to serve the remaining two
years of Mr. Armstrong's term. In addition, the Board of Directors appointed
Kam Law to serve the remainder of Mr. Lawrence's term as a Class II director.
The Board of Directors has nominated the Class II directors currently serving on
the Board of Directors, Mark A. Adley, Eugene G. Banucci and Kam Law, for
election to serve as directors of the Company until the 2002 Annual Meeting of
Stockholders of the Company and until their successors are elected and qualified
or until their earlier resignation or removal. Each of the nominees has
indicated a willingness to serve as a director, but if for any reason any
nominee should be unavailable to serve as a director at the time of the 1999
Annual Meeting, a contingency which the Board of Directors does not expect, a
different person designated by the Board of Directors may be nominated in his
stead.
If a quorum of the holders of Common Stock is present at the 1999 Annual
Meeting, the election of directors will require the affirmative vote of a
plurality of the shares of Common Stock present in person or represented by
proxy and entitled to vote. Abstentions by holders of such shares and broker
non-votes with respect to the election of directors will be included in
determining the presence of such quorum but will not be included in determining
whether nominees have received the vote of such plurality.
The following sets forth certain information regarding the nominees named
above and the other directors of the Company whose terms will continue after the
1999 Annual Meeting.
NOMINEES FOR TERMS EXPIRING IN 2002
MARK A. ADLEY, age 39, has served as a director of the Company since 1991.
Since 1996, Mr. Adley has been a Managing Director at Credit Suisse First Boston
Corporation, where he was a Director from 1994 to 1996. From 1992 through 1993,
Mr. Adley served as an investment manager for Clipper Asset Management
Corporation, the General Partner of The Clipper Group, L.P. ("Clipper"). During
1991, Mr. Adley served as an investment manager for Clipper. Mr. Adley was a
Director at CS First Boston Merchant Bank during 1990 and, at The First Boston
Corporation, was a Vice President from 1989 to 1990 and an Associate from 1985
to 1988.
3
<PAGE>
EUGENE G. BANUCCI, PH.D., age 55, a founder of the Company, has served as
President, Chief Executive Officer, Chairman of the Board and director since
1986. Previously, Dr. Banucci served in a variety of executive and managerial
positions. From 1984 to 1986, he was a director of American Cyanamid Company's
Chemical Research Division, with responsibility for the research, development
and technical service activities of the Chemicals Group.
KAM LAW, PH.D., age 45, was appointed a director of the Company in April 1999.
Dr. Law has been the Senior Vice President of Applied Komatsu Technology
("AKT"), a flat panel display manufacturing equipment supplier, since October
1998. From April 1998 to October 1998, Dr. Law served as General Manager of the
Global Product Organization at AKT. From 1997 to April 1998, Dr. Law served as
Executive Managing Director and General Manager - CVD Products at AKT. From
1994 to 1997, he served as Senior Director of AKT. From 1984 to 1994, Dr. Law
served in a variety of managerial positions at Applied Materials, Inc.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR SUCH NOMINEES.
---
CONTINUING DIRECTORS
Terms Expiring in 2000:
STEPHEN H. MAHLE, age 53, has served as a director of the Company since 1996.
Mr. Mahle has been Senior Vice President of Medtronic, Inc., a medical device
manufacturer, and President of its cardiac rhythm management business since
January 1998. From 1995 to 1998, he was President of the Brady Pacing Business,
a division of Medtronic, Inc. From 1989 to 1995, Mr. Mahle served as Vice
President and General Manager of the Brady Pacing Business. Previously, Mr.
Mahle served in a variety of marketing and product development roles for
Medtronic, Inc.
STEPHEN H. SIEGELE, age 39, has served as President of the Company's ADCS
division and as a director of the Company since October 1997 and as Vice
Chairman of the Board of Directors since February 1999. Mr. Siegele served as
the President and Chief Executive Officer of Advanced Delivery & Chemical
Systems Nevada, Inc. and its affiliates (collectively, the "ADCS Group") from
February 1994 until October 1997 and has served as a director since its
inception in 1988. From 1988 to 1994, Mr. Siegele served as Vice President of
the ADCS Group. Prior to that time, Mr. Siegele served in sales and engineering
positions at Intel Corporation and Olin Hunt Specialty Products, Inc.
Term Expiring in 2001:
ROBERT S. HILLAS, age 50, has served as a director of the Company since 1987.
Mr. Hillas has been the President, Chief Executive Officer and Chairman of the
Board of Envirogen, Inc., an environmental systems and services company, since
April 1998. From 1993 to April 1998, Mr. Hillas served as a Managing Director
of E.M. Warburg, Pincus & Co. LLC. From 1985 to 1992, Mr. Hillas served as a
General Partner of DSV Management Ltd., the General Partner of DSV Partners IV,
a venture capital limited partnership, and from 1981 to 1992, as a General
Partner of DSV Partners III, a venture capital limited partnership. Mr. Hillas
is also a director of Transition Systems, Inc. and United States Filter
Corporation.
LAMONTE H. LAWRENCE, age 60, has served as a director of the Company since
October 1997. Mr. Lawrence has been the President and Chief Executive Officer
of Lawrence Semiconductor Laboratories, Inc., an epitaxial process research and
development company, since October 1997. Previously, Mr. Lawrence served as the
President and Chief Executive Officer of Lawrence Semiconductor Laboratories,
Inc. ("LSL"), now a wholly-owned subsidiary of the Company, from its inception
in 1988 until October 1997. In 1983, Mr. Lawrence founded U.S. Semiconductor
Corp., where he served as President from its inception in 1983 to 1987.
4
<PAGE>
BOARD OF DIRECTORS COMMITTEES AND MEETINGS
The standing committees of the Board of Directors are the Audit Committee, the
Compensation Committee and the Nominating Committee.
The Audit Committee is currently comprised of Mark A. Adley and Robert S.
Hillas. The Audit Committee oversees the Company's system of internal
accounting controls, recommends to the Board of Directors and the stockholders
the appointment of a firm of independent certified auditors to conduct the
annual audit of the Company's financial statements, reviews the scope of the
audit, reviews reports from the independent certified auditors, and makes such
recommendations to the Board of Directors in connection with the annual audit as
it deems appropriate. The Audit Committee met twice during 1998.
The Compensation Committee is currently comprised of Mark A. Adley, Robert S.
Hillas and Stephen H. Mahle. The Compensation Committee reviews the
compensation of officers of the Company and the Company's compensation policies
and practices. The Compensation Committee also administers the 1987, 1995, 1997
and 1998 Stock Plans, including recommending the grant of stock options
thereunder. The Compensation Committee met twice during 1998.
The Nominating Committee is currently comprised of Eugene G. Banucci, Lamonte
H. Lawrence and Stephen H. Siegele. The Nominating Committee has the authority
to recommend to the Board of Directors criteria for the selection of candidates
for director, evaluate candidates and recommend nominees to serve as directors.
The Nominating Committee met twice during 1998.
The Board of Directors held eight meetings during 1998. Each director
attended at least 75% of the aggregate of (i) the total number of meetings of
the Board of Directors and (ii) the total number of meetings held by all
committees of the Board on which such director served.
DIRECTOR COMPENSATION
The Company's outside directors do not receive any cash compensation for
service on the Board of Directors or any committee thereof but are reimbursed
for expenses incurred in connection with attending meetings of the Board of
Directors and any committee thereof. In December 1994, the Company granted
options for the purchase of 22,500 shares of Common Stock at an exercise price
of $5.50 per share to Robert S. Hillas in consideration of his services on the
Board of Directors. In May 1995, the Company granted options for the purchase
of 22,500 shares of Common Stock at an exercise price of $8.50 per share to Mark
A. Adley in consideration of his services on the Board of Directors. In March
1996, the Company granted options for the purchase of 22,500 shares of Common
Stock at an exercise price of $10.50 per share to Stephen H. Mahle in
consideration of his services on the Board of Directors. In January 1998, the
Company granted options for the purchase of 25,500, 25,000 and 2,000 shares of
Common Stock at an exercise price of $24.25 per share to Mark A. Adley, Robert
S. Hillas and Stephen H. Mahle, respectively, in consideration of their services
on the Board of Directors. In April 1999, the Company granted fully vested
options for the purchase of 5,000 shares of Common Stock at an exercise price of
$21.50 per share to Kam Law in connection with his appointment to the Board of
Directors. In each case, the exercise price for the options granted was the
fair market value of the Common Stock on the date of grant, and, except for the
options granted to Dr. Law, the options granted were subject to certain vesting
provisions.
5
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION
The following table sets forth certain information regarding the compensation
paid by the Company for the years ended December 31, 1998, 1997 and 1996 to the
Company's Chief Executive Officer and each of the other four most highly
compensated executive officers in 1998 (together, the "Named Executive
Officers") for services in all capacities to the Company and its subsidiaries.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
--------------------
AWARDS
--------------------------------- --------------------
ANNUAL COMPENSATION SECURITIES ALL OTHER
--------------------------------- UNDERLYING COMPEN-
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) OPTIONS (#) SATION ($)(1)
- - --------------------------- ------ ------------------ ------------- -------------------- --------------------
<S> <C> <C> <C> <C> <C>
Eugene G. Banucci...................... 1998 241,091 - 60,000 5,346
President, Chief Executive Officer 1997 210,000 125,000 25,000 3,769
and Chairman of the Board 1996 181,300 40,000 - 2,121
Stephen H. Siegele (2)................. 1998 300,000 - - 4,667
President - ADCS, Vice Chairman 1997 89,000 - - -
of the Board 1996 - - - -
Douglas J. Neugold (3)................. 1998 186,364 33,333 39,000 100,283
Executive Vice President 1997 - - - -
1996 - - - -
Peter S. Kirlin........................ 1998 164,792 - 30,000 2,975
Executive Vice President 1997 150,000 50,000 20,000 2,700
1996 111,100 30,000 - -
Daniel P. Sharkey..................... 1998 160,083 - 30,000 2,273
Vice President, Chief Financial 1997 130,000 50,000 15,000 1,903
Officer and Treasurer 1996 110,000 20,000 - 1,678
</TABLE>
__________________
(1) Represents premiums paid for life insurance and long-term disability
policies of which the Company is not the beneficiary and flexible spending
contributions toward health care costs not covered by Company plans. In the
case of Mr. Neugold, it also represents payments for relocation expenses.
(2) Mr. Siegele joined the Company on October 13, 1997 in connection with the
Company's acquisition of the ADCS Group.
(3) Mr. Neugold joined the Company on January 22, 1998. The 1998 bonus amount
represents a one-time payment upon joining the Company.
6
<PAGE>
OPTION GRANTS
The following table sets forth certain information with respect to stock
options granted to the Named Executive Officers during the year ended December
31, 1998.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL
INDIVIDUAL GRANTS REALIZABLE VALUE AT
----------------------------------------------------------------------
NUMBER OF % OF TOTAL ASSUMED ANNUAL
SECURITIES OPTIONS RATES OF STOCK
UNDERLYING GRANTED TO EXERCISE PRICE APPRECIATION
OPTIONS EMPLOYEES PRICE EXPIRATION FOR OPTION TERM (2)
-------------------------------
NAME GRANTED(#)(1) IN 1998 ($/SH) DATE 5% ($) 10% ($)
- - -------------------- --------------------- -------------- ------------ ------------- -------------------------------
<S> <C> <C> <C> <C> <C> <C>
Eugene G. Banucci..... 60,000 8.0% 24.25 1/1/08 915,042 2,318,895
Stephen H. Siegele.... - - - - - -
Douglas J. Neugold.... 39,000 5.2% 24.25 1/1/08 594,777 1,507,282
Peter S. Kirlin....... 30,000 4.0% 24.25 1/1/08 457,521 1,159,448
Daniel P. Sharkey..... 30,000 4.0% 24.25 1/1/08 457,521 1,159,448
</TABLE>
__________________
(1) Options granted vest ratably over five years on each of the first five
anniversary dates of the grant date.
(2) The dollar amounts under these columns are the result of calculations
assuming 5% and 10% growth rates as set by the Securities and Exchange
Commission and, therefore, are not intended to forecast future price
appreciation, if any, of the Company's Common Stock.
STOCK OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information concerning option holdings as of
December 31, 1998 with respect to the Named Executive Officers.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
SHARES NUMBER OF SECURITIES VALUE OF UNEXERCISED
ACQUIRED UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
ON VALUE OPTIONS AT FY-END (#) AT FY-END ($)(1)
---------------------------------- ---------------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- - ------------------- ------------- ---------------- ---------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C>
Eugene G. Banucci... - - 125,375 94,000 2,785,544 438,750
Stephen H. Siegele.. - - - - - -
Douglas J. Neugold.. - - - 39,000 - 117,000
Peter S. Kirlin..... 11,092 204,707 62,682 56,000 1,323,415 314,250
Daniel P. Sharkey... - - 87,875 48,000 1,975,247 219,750
</TABLE>
__________________
(1) Based on the fair market value of the Company's Common Stock as of December
31, 1998 ($25.25) minus the exercise price of the options.
7
<PAGE>
EMPLOYMENT AGREEMENTS
The Company entered into employment agreements with Eugene G. Banucci, Daniel
P. Sharkey and Stephen H. Siegele, effective October 10, 1997. Pursuant to the
agreements, Dr. Banucci will act as President, Chief Executive Officer and
Chairman of the Board of the Company, Mr. Sharkey will act as Vice President,
Chief Financial Officer and Treasurer of the Company, and Mr. Siegele will act
as President of the ADCS division of the Company, for annual salaries of
$210,000, $130,000 and $400,000, respectively. Salaries are subject to increase
from time to time to take into account appropriate cost of living adjustments
and general compensation increases based on performance, in the discretion of
the Board of Directors. Each employee will also be eligible to receive
additional compensation, including awards of performance bonuses at levels
commensurate with other employees of the Company of equivalent position and
grants of employee stock options, in each case in the discretion of the
Compensation Committee of the Board of Directors. In June 1998, certain
executive officers, including Messrs. Banucci, Sharkey and Siegele, agreed to a
temporary salary reduction for the remainder of 1998 in response to the
Company's financial performance.
The employment agreements expire on the earliest to occur of (i) October 10,
1999, (ii) the death of the employee, (iii) the termination of the agreements
due to the incapacity of the employee, (iv) the termination of the agreements by
the Company with or without cause, or (v) the termination of the agreements by
the employee for just cause. Under the terms of the agreements, if the Company
terminates the employee without cause, or if the employee terminates the
agreement for just cause, the Company will pay the employee his annual base
salary then in effect for a period of 18 months after termination in the case of
Dr. Banucci and Mr. Siegele, and for a period of nine months after termination
in the case of Mr. Sharkey. The Company will also provide the employee during
such period with medical, dental, life and disability insurance benefits on the
same basis the Company would have provided the employee during such period had
he continued to be an employee of the Company.
The employment agreements restrict each employee from competing with the
Company during the term of the agreement and for a period of the later of
October 10, 2002 or 36 months after the termination of employment in the case of
Dr. Banucci and Mr. Siegele, or 24 months after the termination of employment in
the case of Mr. Sharkey. In the event the Company should seek to enforce such
non-competition provisions in a court, a court may, in exercising its
discretionary authority, determine not to enforce, or to limit enforcement of,
such provisions against an employee.
The employment agreements for Dr. Banucci and Mr. Sharkey also provide that
any termination associated with a change in control of the Company (including
resignation by the employee for just cause such as a significant decrease in the
employee's duties or authority) would result in the acceleration of options
outstanding (and as may be subsequently granted) to them; provided that such
acceleration of vesting shall not occur if and to the extent that (i) the
Company's independent accountant has advised the Board of Directors that such
acceleration could prohibit the accounting treatment of the transaction which is
a change in control as a pooling of interests under Accounting Principles Board
Opinion No. 16 (or any successor opinion) and (ii) the Board of Directors
intends to treat such transaction as a pooling of interests, in which case
options would continue to vest as permitted within the terms of the applicable
stock plans. In addition, Dr. Banucci and Mr. Sharkey would be entitled to any
bonuses under any bonus plans then in effect as if fully earned. Benefits
payable under the agreements upon a change in control may subject the employee
to an excise tax as "excess parachute payments" under Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"). The Company will
reimburse the employee for all excise taxes paid, but the reimbursement will
constitute an excess parachute payment and will be subject to further excise
tax. Such further excise tax will trigger further reimbursement by the Company.
The Company will not be allowed to take a deduction for federal income tax
purposes for the excess parachute payments.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1998, the Compensation Committee of the Board of Directors consisted of
Mark A. Adley, Robert S. Hillas and Stephen H. Mahle. No executive officer of
the Company served on the compensation committee of another entity or on any
other committee of the board of directors of another entity performing similar
functions during the last fiscal year.
8
<PAGE>
COMPENSATION COMMITTEE REPORT
The Compensation Committee, which is comprised of non-employee directors of
the Company, is responsible for administering the Company's executive
compensation program and reviewing and making recommendations to the Board of
Directors with respect to the compensation of executive officers and other
senior management and the Company's overall compensation policy. In connection
with such responsibilities, the Compensation Committee has authority to
administer the Company's 1987, 1995, 1997 and 1998 Stock Plans, including
recommending the grant of stock options and other awards thereunder. All other
actions of the Compensation Committee are subject to the approval of the Board
of Directors.
The Company's executive compensation program is intended to attract and retain
talented executives and senior management by offering competitive compensation
opportunities. Furthermore, the Company's compensation program is designed to
motivate and reward high-performing individuals based on variable compensation
tied to overall corporate, separate business unit and individual performance and
the creation of stockholder value. The Company's philosophy is that the
combination of performance-based and stock-based compensation serves to maximize
annual and long-term results and, ultimately, stockholder value. The components
of the Company's executive compensation program include base salary, annual cash
and stock option incentives and long-term stock option incentives. The
Compensation Committee has discretion as to the components awarded in a
particular year to each executive officer.
Components of Executive Compensation
Base Salary. The Compensation Committee annually reviews officers' base
salaries. The Compensation Committee evaluates management's recommendations
based on the results achieved by each officer relative to the assigned goals of
the recently completed year as well as competitive salary practices of other
similar companies.
Annual Incentives. Annual incentives are designed to provide officers with a
potential cash and/or stock option award based on the achievement of annual
financial and operating objectives. These objectives and potential award
amounts are approved by the Compensation Committee and the Board of Directors on
an annual basis in advance and are based upon operating plans approved by the
Board of Directors. The Compensation Committee approves specific objectives for
each officer.
In 1998, these objectives included the performance of business divisions, the
achievement of budgeted financial performance and the successful completion of
certain other strategic transactions. The Compensation Committee determined
that no cash bonus awards were payable to any executive officer at the end of
1998 based upon the financial performance of the Company during 1998. For 1999
and future years, the Compensation Committee intends to continue to consider
utilizing both stock option grants and cash bonus awards to reward the
achievement of annual objectives.
Long-term Incentives. The Compensation Committee may also recommend to the
Board of Directors the grant to officers of stock options under the Company's
1995, 1997 and 1998 Stock Plans that are distinct from stock options granted as
annual incentives. These options, which vest over time, are awarded to officers
based on their continued contribution to the Company's achievement of financial
and operating objectives. These awards are designed to align the interests of
the Company's officers with the interests of the Company's stockholders and to
motivate the Company's officers to remain focused on the overall long-term
performance of the Company. In 1998, executive officers received grants of non-
qualified stock options. These options were granted at the fair market value of
the Common Stock on the date of grant. The options become exercisable over a
five-year period and have a ten-year term. In determining the number of stock
options granted to executive officers, the Compensation Committee took into
account position levels, individual performance, the tax consequences of the
grant to the individual and the Company and the number of shares available for
issuance under the Company's 1995, 1997 and 1998 Stock Plans.
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Chief Executive Officer Compensation
During 1998, the Company's Chief Executive Officer, Eugene G. Banucci,
participated in the same executive compensation program provided to other
executive officers and senior management of the Company as described above.
Approximately 50% of the increase in Dr. Banucci's base salary is based on the
Company's financial performance, primarily earnings per share and revenue
growth, in the previous fiscal year. The other 50% is based on fulfillment of a
series of objectives during the previous fiscal year established at the
beginning of the year by the Compensation Committee in consultation with the
Chief Executive Officer. The objectives used to determine base salary for
fiscal 1998 consisted of new product introductions, market share growth and
exceeding certain financial objectives. In 1998, Dr. Banucci received a base
salary of $300,000, which represented a 43% increase over his base salary in
1997. On June 30, 1998, the Compensation Committee implemented a temporary 33%
salary reduction in Dr. Banucci's base pay, effective through the remainder of
1998 and did not authorize any cash bonus for 1998, given the Company's
financial performance in light of an overall industry slowdown during the year.
On January 1, 1998, Dr. Banucci was granted non-qualified stock options to
purchase 60,000 shares of Common Stock at an exercise price of $24.25 per share,
which was the fair market value of the Common Stock on the date of grant. The
options become exercisable over a five-year period and have a ten-year term.
Compensation Committee:
Mark A. Adley
Robert S. Hillas
Stephen H. Mahle
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Stock Performance Graph
The following graph compares the cumulative total stockholder return on the
Company's Common Stock with the return on the Total Return Index for the Nasdaq
Stock Market (U.S.) and the Nasdaq Electronic Components Stock Index. The
measurement assumes a $100 investment as of December 31, 1993 with all dividends
reinvested. The data presented are on an annual basis for the five years ended
on December 31, 1998.
[GRAPH APPEARS HERE]
EDGAR REPRESENTATION OF
DATA POINTS USED IN PRINTED GRAPH
Total Return Index
ATMI for the Nasdaq Nasdaq Electronic
Common Stock Stock MarKet (US) Component Stock Index
------------ ----------------- ---------------------
12/31/93 $100 $100 $100
12/31/94 101 98 110
12/31/95 170 138 183
12/31/96 294 170 316
12/31/97 413 209 332
12/31/98 430 293 513
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CERTAIN TRANSACTIONS
In March 1997, the Company loaned Peter S. Kirlin $60,000 in exchange for Dr.
Kirlin's promissory note bearing interest at 6% per annum. In July 1997, the
Company loaned Dr. Kirlin an additional $50,000 in exchange for Dr. Kirlin's
promissory note bearing interest at 6% per annum. In December 1997, Dr. Kirlin
prepaid an aggregate of $23,120 due under the notes. In April 1998, the Company
loaned Dr. Kirlin an additional $45,000 in exchange for Dr. Kirlin's promissory
note bearing interest at 6% per annum. On June 30, 1998 the Company
consolidated all separate notes into one promissory note in the principal amount
of $131,880 bearing interest at 6% per annum. The note is due and payable on
June 30, 1999.
2. RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Ernst & Young LLP as independent certified
auditors to audit the consolidated financial statements of the Company for the
fiscal year ending December 31, 1999 and has determined that it would be
desirable to request that the stockholders ratify such selection. The
affirmative vote of a majority of the outstanding shares of Common Stock present
at the 1999 Annual Meeting in person or by proxy is necessary for the
ratification of the appointment by the Board of Directors of Ernst & Young LLP
as independent certified auditors. Ernst & Young LLP served as the Company's
independent certified auditors for the fiscal year ended December 31, 1998 and
has reported on the Company's consolidated financial statements for such year.
Representatives of Ernst & Young LLP are expected to be present at the 1999
Annual Meeting, will have the opportunity to make a statement if they desire to
do so and will be available to respond to appropriate questions from
stockholders.
While stockholder ratification is not required for the selection of Ernst &
Young LLP since the Board of Directors has the responsibility for selecting the
Company's independent certified auditors, the selection is being submitted for
ratification at the 1999 Annual Meeting with a view towards soliciting the
stockholders' opinions, which the Board of Directors will take into
consideration in future deliberations.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF ERNST & YOUNG
---
LLP AS INDEPENDENT CERTIFIED AUDITORS OF THE COMPANY FOR THE FISCAL YEAR ENDING
DECEMBER 31, 1999.
OTHER BUSINESS
The Board of Directors knows of no other business to be brought before the
1999 Annual Meeting. If, however, any other business should properly come
before the 1999 Annual Meeting, the persons named in the accompanying proxy will
vote the proxy as in their discretion they may deem appropriate, unless they are
directed by the proxy to do otherwise.
COST OF SOLICITING PROXIES
The cost of soliciting proxies will be paid by the Company. In addition to
the solicitation of proxies by mail, proxies may be solicited by personal
interview, telephone and similar means by directors, officers or regular
employees of the Company, none of whom will be specially compensated for such
activities.
STOCKHOLDERS PROPOSALS FOR 2000
Stockholder proposals submitted for inclusion in next year's proxy materials
must be received by the Company no later than December 30, 1999. Stockholder
proposals submitted to be considered at the 2000 Annual Meeting without
inclusion in next year's proxy materials must be received by the Company no
later than March 14, 2000. If the Company is not notified of a stockholder
proposal by March 14, 2000, then proxies held by management of the Company may
provide the discretion to vote against such stockholder proposal, even though
such proposal is not discussed in the proxy statement. Proposals should be
addressed to Dean Hamilton, ATMI, Inc., 7 Commerce Drive, Danbury, Connecticut
06810.
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Any stockholder of record of the Company may nominate candidates for election
to the Board of Directors if a written notice is delivered to the Secretary of
the Company at the Company's principal executive offices not less than 60 days
nor more than 90 days prior to the first anniversary of the preceding year's
annual meeting. Such written notice must set forth: (i) as to each person whom
the stockholder proposes to nominate for election as a director all information
relating to such person that is required to be disclosed in solicitations of
proxies for election of directors pursuant to the Securities Exchange Act of
1934, as amended (including such person's written consent to being named in the
proxy statement as a nominee and to serving as a director if elected), and (ii)
as to the stockholder and the beneficial owner, if any, on whose behalf the
nomination is made (a) the name and address of such stockholder and such
beneficial owner and (b) the number of shares of common stock that are owned
beneficially and held of record by such stockholder and such beneficial owner
By order of the Board of Directors,
Ward C. Stevens
Secretary
Danbury, CT
April 28, 1999
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