SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
[X] Definitive Proxy Statement Commission Only (as permitted by
[ ] Definitive Additional Materials Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
BEI TECHNOLOGIES, INC.
----------------------------------------------------------
(Name of Registrant as Specified in Its 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 transactions applies:
(2) Aggregate number of securities to which transactions 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>
BEI TECHNOLOGIES, INC.
One Post Street, Suite 2500
San Francisco, CA 94104
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 1, 2000
TO THE STOCKHOLDERS OF BEI TECHNOLOGIES, INC.:
Notice Is Hereby Given that the Annual Meeting of Stockholders of BEI
Technologies, Inc., a Delaware corporation (the "Company"), will be held on
Wednesday, March 1, 2000 at 1:30 p.m. local time, at the Company's Systron
Donner Inertial Division, 2700 Systron Drive, Concord, California, for the
following purposes:
1. To elect three directors to hold office until the 2003 Annual
Meeting of Stockholders.
2. To ratify the selection of Ernst & Young LLP as independent
public accountants of the Company for its fiscal year ending
September 30, 2000.
3. To transact such other business as may properly come before
the meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
The Board of Directors has fixed the close of business on January 21,
2000 as the record date for the determination of stockholders entitled to notice
of and to vote at this Annual Meeting and at any adjournment or postponement
thereof.
By Order of the Board of Directors
/s/ Robert R. Corr
----------------------------------------
Robert R. Corr
Corporate Secretary
San Francisco, California
January 26, 2000
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO ENSURE YOUR
REPRESENTATION AT THE MEETING. A RETURN ENVELOPE (WHICH IS POSTAGE PREPAID IF
MAILED IN THE UNITED STATES) IS ENCLOSED FOR THAT PURPOSE. EVEN IF YOU HAVE
GIVEN YOUR PROXY, YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE MEETING. PLEASE
NOTE, HOWEVER, THAT ATTENDANCE AT THE MEETING WILL NOT BY ITSELF REVOKE A PROXY.
FURTHERMORE, IF YOUR SHARES ARE HELD OF RECORD BY A BROKER, BANK OR OTHER
NOMINEE AND YOU WISH TO VOTE AT THE MEETING, YOU MUST OBTAIN FROM THE RECORD
HOLDER A PROXY ISSUED IN YOUR NAME.
<PAGE>
BEI TECHNOLOGIES, INC.
One Post Street, Suite 2500
San Francisco, CA 94104
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
March 1, 2000
INFORMATION CONCERNING SOLICITATION AND VOTING
General
The enclosed proxy is solicited on behalf of the Board of Directors of
BEI Technologies, Inc., a Delaware corporation (the "Company"), for use at the
Annual Meeting of Stockholders to be held on March 1, 2000, at 1:30 p.m. local
time (the "Annual Meeting"), or at any adjournment or postponement thereof, for
the purposes set forth herein and in the accompanying Notice of Annual Meeting.
The Annual Meeting will be held at the Company's Systron Donner Inertial
Division, 2700 Systron Drive, Concord, California. The Company intends to mail
this proxy statement and accompanying proxy card on or about February 1, 2000 to
all stockholders entitled to vote at the Annual Meeting.
The Company was organized under the laws of the state of Delaware on
June 30, 1997 as a wholly-owned subsidiary of BEI Electronics, Inc.,
subsequently renamed BEI Medical Systems Company, Inc. ("Electronics"). The
Company began independent operations on September 28, 1997 as a result of the
distribution by Electronics of all of the outstanding stock of the Company to
the stockholders of Electronics (the "Distribution"). For further information
about the Distribution, see the Company's Form 10 "General Form for Registration
of Securities", as amended (File No. 0-22799) (the "Form 10"), the Company's
Form 10-K Annual Report for the fiscal year ended September 27, 1997 (the
"10-K") and Note 1 of "Notes to Consolidated Financial Statements" included in
the 10-K.
Solicitation
The Company will bear the entire cost of solicitation of proxies,
including preparation, assembly, printing and mailing of this proxy statement,
the proxy and any additional information furnished to stockholders. Copies of
solicitation materials will be furnished to banks, brokerage houses, fiduciaries
and custodians holding in their names shares of Common Stock beneficially owned
by others to forward to such beneficial owners. The Company may reimburse
persons representing beneficial owners of Common Stock for their costs of
forwarding solicitation materials to such beneficial owners. Original
solicitation of proxies by mail may be supplemented by telephone, telegram or
personal solicitation by directors, officers or other regular employees of the
Company. No additional compensation will be paid to directors, officers or other
regular employees for such services.
Voting Rights and Outstanding Shares
Only holders of record of Common Stock at the close of business on
January 21, 2000 will be entitled to notice of and to vote at the Annual
Meeting. At the close of business on January 21, 2000, the Company had
outstanding and entitled to vote 7,496,568 shares of Common Stock. Each holder
of record of Common Stock on such date will be entitled to one vote for each
share held on all matters to be voted upon at the Annual Meeting.
All votes will be tabulated by the inspector of election appointed for
the meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes. Abstentions will be counted towards the
tabulation of votes cast on proposals presented to the stockholders and will
have the same effect as negative votes. Broker non-votes are counted towards a
quorum, but are not counted for any purpose in determining whether a matter has
been approved.
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Revocability of Proxies
Any person giving a proxy pursuant to this solicitation has the power
to revoke it at any time before it is voted. It may be revoked by filing with
the Secretary of the Company at the Company's principal executive office, One
Post Street, Suite 2500, San Francisco, California 94104, a written notice of
revocation or a duly executed proxy bearing a later date, or it may be revoked
by attending the meeting and voting in person. Please note, however, that
attendance at the meeting will not by itself revoke a proxy. Furthermore, if the
shares are held of record by a broker, bank or other nominee and the stockholder
wishes to vote at the meeting, the stockholder must obtain from the record
holder a proxy issued in the stockholder's name.
Stockholder Proposals
The deadline for submitting a stockholder proposal for inclusion in the
Company's proxy statement and form of proxy for the Company's 2001 Annual
Meeting of stockholders pursuant to Rule 14a-8 of the Securities and Exchange
Commission is October 3, 2000. The deadline for submitting a stockholder's
proposal or a nomination for director that is not to be included in such proxy
statements and proxy is December 1, 2000. Stockholders are also advised to
review the Company's By-Laws, which contain additional requirements with respect
to advance notice of stockholder proposals and director nominations.
Proposal 1
Election Of Directors
The Company's Certificate of Incorporation and By-Laws provide that the
Board of Directors shall be divided into three classes, each class consisting,
as nearly as possible, of one-third of the total number of directors, with each
class having a three-year term. Vacancies on the Board may be filled by the
affirmative vote of the holders of a majority of the voting power of the then
outstanding shares of Common Stock or by the affirmative vote of a majority of
the remaining directors. A director elected by the Board to fill a vacancy
(including a vacancy created by an increase in the authorized number of
directors on the Board) shall serve for the remainder of the full term of the
class of directors in which the vacancy occurred and until such director's
successor is elected and has qualified or until his earlier death, resignation
or removal.
The Board of Directors is presently composed of eight members. There
are three directors in the class whose term of office expires in 2000. The three
nominees for election to this class, Richard M. Brooks, Dr. William G. Howard,
Jr. and Dr. Robert Mehrabian, are directors of the Company who were previously
appointed by the sole incorporator. If elected at the Annual Meeting, each of
the nominees would serve until the 2003 annual meeting and until his successor
is elected and has qualified, or until such director's earlier death,
resignation or removal.
Directors are elected by a plurality of the votes present in person or
represented by proxy and entitled to vote at the meeting. Shares represented by
executed proxies will be voted, if authority to do so is not withheld, for the
election of the three nominees named below. In the event that any nominee should
be unavailable for election as a result of an unexpected occurrence, such shares
will be voted for the election of such substitute nominee as the Board of
Directors may propose. Each person nominated for election has agreed to serve if
elected, and the Board of Directors has no reason to believe that any nominee
will be unable to serve.
Set forth below is biographical information for each person nominated
and each person whose term of office as a director will continue after the
Annual Meeting.
Nominees for Election for a Three-Year Term Expiring at the 2003 Annual Meeting
Richard M. Brooks
Mr. Brooks, age 71, is currently an independent financial consultant.
He began serving as a Director in June 1997 prior to the Distribution and
resulting spin-off of the Company from Electronics in September 1997. From 1987
until his resignation as a result of the Distribution, he served as a director
of
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Electronics. From 1987 to 1990 he served as President of SFA Management
Corporation, the managing general partner of St. Francis Associates, an
investment partnership. He currently serves as a director of Longs Drug Store
Corporation, Granite Construction, Inc. and the Western Farm Credit Bank, a
private company. Mr. Brooks holds a B.S. from Yale University and a M.B.A. from
the University of California, Berkeley.
Dr. William G. Howard, Jr.
Dr. Howard, age 58, began serving as a Director in June 1997 prior to
the Distribution and resulting spin-off of the Company from Electronics in
September 1997. He was a director of Electronics from December 1992 until his
resignation as a result of the Distribution. He is currently an independent
consulting engineer in microelectronics and technology-based business planning.
From 1987 to 1990, Dr. Howard served as Senior Fellow of the National Academy of
Engineering and, prior to that time, held various technical and management
positions with Motorola, Inc. most recently as Senior Vice President and
Director of Research and Development. He currently serves as Chairman of
Credence Systems, Inc. and a director of RAMTRON International Corp.,
Thunderbird Technologies, Inc., and Xilinx, Inc. Dr. Howard holds a B.S.E.E. and
a M.S. from Cornell University and a Ph.D. in electrical engineering and
computer sciences from the University of California, Berkeley.
Dr. Robert Mehrabian
Dr. Mehrabian, age 58, began serving as a Director in June 1997 prior
to the Distribution and resulting spin-off of the Company from Electronics in
September 1997. He was a director of Electronics from June 1997 until his
resignation as a result of the Distribution. He is Chief Executive Officer and
President of Teledyne Technologies, Inc. From 1997 to November 1999, he held a
number of senior executive positions at Allegheny Teledyne, Inc., including
Chief Executive Officer and President of the Aeronautics and Electronics segment
of the company that spun-out into a separate public company, Teledyne
Technologies, Inc. From 1990 through June 1997, he was president of Carnegie
Mellon University. He is an internationally recognized materials scientist with
numerous awards including membership in the National Academy of Engineering. He
serves on the boards of directors of Teledyne Technolgies, Inc., Mellon
Financial Corporation and PPG Industries, Inc. Dr. Mehrabian holds B.S. and
Sc.D. degrees from Massachusetts Institute of Technology.
The three candidates receiving the highest number of affirmative votes
cast at the meeting will be elected directors of the Company.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
IN FAVOR OF EACH NAMED NOMINEE
Directors Continuing in Office Until the 2001 Annual Meeting
George S. Brown
Mr. Brown, age 78, began serving as a Director in June 1997 prior to
the Distribution and resulting spin-off of the Company from Electronics in
September 1997. He served as a director of Electronics from October 1974 until
his resignation as a result of the Distribution. Mr. Brown served as President
and Chief Executive Officer of Electronics from October 1974 until July 1990.
Mr. Brown served from 1971 until 1974 as Executive Vice President and General
Manager of Baldwin Electronics, Inc., a subsidiary of D.H. Baldwin Company and
the predecessor of Electronics. Mr. Brown holds a B.S.E.E. from the University
of Oklahoma.
Charles Crocker
Mr. Crocker, age 60, began serving as a Director in June 1997 prior to
the Distribution and resulting spin-off of the Company from Electronics in
September 1997. He was a founder of Electronics and has served as Chairman of
the Board of Directors of Electronics (now named BEI Medical Systems Company,
Inc.) since October 1974 and Chairman of the Board of Directors of Technologies
since October 1997. Mr.
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Crocker assumed the positions of President and Chief Executive Officer of
Technologies, effective October 1, 1997, after resigning as President and CEO of
Electronics as a result of the Distribution. Mr. Crocker served as President of
Crocker Capital Corporation, a Small Business Investment Company, from 1970 to
1985, and as General Partner of Crocker Associates, a venture capital investment
partnership, from 1970 to 1990. He currently serves as a director of Fiduciary
Trust Company International, Pope & Talbot, Inc. and KeraVision. Mr. Crocker
holds a B.S. from Stanford University and a M.B.A. from the University of
California, Berkeley.
Directors Continuing in Office Until the 2002 Annual Meeting
C. Joseph Giroir, Jr.
Mr. Giroir, age 60, began serving as a Director in June 1997 prior to
the Distribution and resulting spin-off of the Company from Electronics in
September 1997. He was a director of Electronics from 1978 until his resignation
as a result of the Distribution. He served as the Secretary of Electronics from
1974 to early 1995. He is currently of counsel to the law firm of Giroir,
Gregory, Holmes & Hoover, PLC. Mr. Giroir is also President of Arkansas
International Development Corporation II, LLC and Chairman of the Board of
Directors for Clinical Study Centers, LLC. Mr. Giroir holds a B.A. and an L.L.B.
from the University of Arkansas and an L.L.M. from Georgetown University.
Asad M. Madni
Dr. Madni, age 52, began serving as a Director and as a Vice President
of the Company in June 1997 prior to the Distribution and resulting spin-off of
the Company from Electronics in September 1997. Dr. Madni was appointed
President of BEI Sensors & Systems Company, Inc. ("Sensors & Systems") in
October 1993, which was formed by the consolidation of BEI Motion Systems
Company and the BEI Sensors & Controls Group, of which Dr. Madni had been
President since October 1992. Prior to joining BEI Electronics in 1992, he
served for 17 years in various executive and technical management positions with
Systron Donner Corporation, a manufacturer of avionics and aerospace sensors and
subsystems. He served most recently as Chairman, President and CEO of Systron
Donner Corporation, a subsidiary of Thorn/EMI. Dr. Madni's degrees include a
Bachelor of Science and Master of Science in Engineering from the University of
California, Los Angeles, and a Ph.D. in Engineering from California Coast
University. He is also a graduate of the Program for Senior Executives from the
Massachusetts Institute of Technology, Sloan School of Management. He is a
Chartered Engineer and Fellow of the Institute of Electrical and Electronics
Engineers and the Institution of Electrical Engineers.
Gary D. Wrench
Mr. Wrench, age 66, began serving as a Director in June 1997 prior to
the Distribution and resulting spin-off of the Company from Electronics in
September 1997. He was Senior Vice President and Chief Financial Officer of
Electronics from July 1993 until his resignation as a result of the
Distribution. He currently holds these same positions with Technologies. He has
served as a Director of Electronics since February 1986, and continues to serve
as a director of both Electronics (now named BEI Medical Systems Company, Inc.)
and Technologies. From April 1985 to July 1993, he served as Vice President of
Electronics and President and Chief Executive Officer of BEI Motion Systems
Company, Inc., then a wholly owned subsidiary of Electronics that is now a part
of Sensors & Systems. His other experience includes twenty years with Hughes
Aircraft Company. Mr. Wrench holds a B.A. from Pomona College and a M.B.A. from
the University of California, Los Angeles.
Board Committees and Meetings
During the fiscal year ended October 2, 1999, the Board of Directors
held three meetings. The Board has an Audit Committee and a Compensation
Committee, but does not have a Nominating Committee or any committee performing
a similar function.
The Audit Committee's responsibilities include the following: meet with
the Company's independent accountants at least annually to review the scope and
results of the annual audit; recommend to the Board
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the independent accountants to be retained; and receive and consider the
accountants' comments as to internal controls, accounting staff, management
performance, and procedures performed and results obtained in connection with
the audit. During fiscal 1999, the Audit Committee was composed of four
directors: Mr. Brooks, Chairman of the Committee, and Messrs. Giroir, Howard and
Mehrabian. The Audit Committee met three times during fiscal 1999.
The Compensation Committee makes recommendations concerning salaries
and incentive compensation for the Company's executive officers, awards stock
options and stock bonuses to eligible executives, employees and consultants
under the Company's 1997 Equity Incentive Plan (the "1997 Plan"), and otherwise
determines compensation levels and performs such other functions regarding
compensation as the Board may delegate. During fiscal 1999, the Compensation
Committee was composed of three non-employee directors: Mr. Brown, Chairman of
the Committee, and Messrs. Brooks, and Giroir. The Compensation Committee met
once during fiscal 1999.
During fiscal 1999 each Board member, except Messrs. Brooks, Howard and
Mehrabian, attended at least 75% or more of the aggregate of the meetings of the
Board and of the committees on which he served, held during the period for which
he was a director or committee member, respectively.
Proposal 2
Ratification of Selection of Independent Public Accountants
The Board of Directors has selected Ernst & Young LLP as the Company's
independent public accountants for the fiscal year ending September 30, 2000.
Ernst & Young LLP (including its predecessor, Ernst & Whinney) has audited
Electronics' financial statements since 1975 and audited the Company's financial
statements since fiscal 1997. A representative of Ernst & Young LLP is expected
to be present at the Annual Meeting, will have an opportunity to make a
statement if he or she so desires and will be available to respond to
appropriate questions.
Stockholder ratification of the selection of Ernst & Young LLP as the
Company's independent public accountants is not required by the Company's
By-Laws or otherwise. However, the Board is submitting the selection of Ernst &
Young LLP to the stockholders for ratification as a matter of good corporate
practice. If the stockholders fail to ratify the selection, the Audit Committee
and the Board will reconsider whether or not to retain that firm. Even if the
selection is ratified, the Board at its discretion may direct the appointment of
a different independent accounting firm at any time during the year if it
determines that such a change would be in the best interests of the Company and
its stockholders.
The affirmative vote of the holders of a majority of the shares
represented and entitled to vote at the meeting will be required to ratify the
selection of Ernst & Young LLP as the Company's independent public accountants
for the fiscal year ending September 30, 2000. Abstentions will be counted
toward the tabulation of votes cast on proposals presented to the stockholders
and will have the same effect as negative votes. Broker non-votes are counted
towards a quorum, but are not counted for any purpose in determining whether
this matter has been approved.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
IN FAVOR OF PROPOSAL 2
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SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
<TABLE>
The following table sets forth certain information regarding the
ownership of the Company's Common Stock as of December 31, 1999 by: (i) each
director; (ii) each of the executive officers named in the Summary Compensation
Table; (iii) all executive officers and directors of the Company as a group; and
(iv) all those known by the Company to be beneficial owners of more than five
percent of its Common Stock.
<CAPTION>
Beneficial Ownership (l)
------------------------
Number of Percent of
Beneficial Owner Shares Total(2)
---------------- ------ --------
<S> <C> <C>
Mr. Charles Crocker(3) ............................... 1,552,904 20.7%
One Post Street
Suite 2500
San Francisco, CA
Hollybank Investments, L.P.(4) ....................... 651,700 8.7%
One Financial Center, Suite 1600
Boston, MA
Lord Abbett & Co.(5) ................................. 647,200 8.6%
The GM Building
767 Fifth Avenue
New York, NY
Dimensional Fund Advisors, Inc.(6) ................... 495,500 6.7%
1299 Ocean Avenue
11th Floor
Santa Monica, CA
State Street Research & Management Co.(7) ............ 449,500 6.0%
One Financial Center, Suite 1600
Boston, MA
Putnam Investment Management Inc.(8) ................. 377,100 5.0%
One Post Office Square
Boston, MA
Mr. Richard M. Brooks(9) ............................. 8,000 *
Mr. George S. Brown(9)(10) ........................... 30,528 *
Mr. Robert R. Corr(9)(12) ............................ 40,821 *
Mr. C. Joseph Giroir, Jr.(9) ......................... 0 *
Dr. William G. Howard, Jr.(9) ........................ 4,000 *
Dr. Asad M. Madni(9) ................................. 93,789 *
Dr. Robert Mehrabian(9) .............................. 5,500 *
Dr. Lawrence A. Wan(9) ............................... 29,432 *
Mr. Gary D. Wrench(9)(11) ............................ 89,103 1.2%
All executive officers and directors as a group
(10 persons)(13) .................................... 1,854,077 25.1%
<FN>
- ------------
* Less than one percent.
(1) This table is based upon information supplied by officers, directors and
principal stockholders of the Company and upon any Schedules 13D or 13G
filed with the Securities and Exchange Commission (the "Commission").
Unless otherwise indicated in the footnotes to this table and subject to
community property laws where applicable, the Company believes that each of
the stockholders named in this table has sole voting and investment power
with respect to the shares indicated as beneficially owned.
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(2) Applicable percentages are based on 7,491,464 shares outstanding on
December 31, 1999, adjusted as required by rules promulgated by the
Commission.
(3) Includes 395,000 shares held by Mr. Crocker as trustee for his adult
children, as to which Mr. Crocker disclaims beneficial ownership. Also
includes 54,936 shares held in a trust of which Mr. Crocker is beneficiary
and sole trustee. Mr. Crocker, acting alone, has the power to vote and
dispose of the shares in each of these trusts.
(4) Represents shares held by Hollybank Investments, LP ("Hollybank") which has
the sole power to vote and dispose of the shares held by it, and includes
52,000 shares held by Dorsey R. Gardner, general partner of Hollybank, who
has the sole power to vote and dispose of his shares. Mr. Gardner, as
general partner of Hollybank, may be deemed to beneficially own shares held
by Hollybank. Except to the extent of his interest as a limited partner in
Hollybank, Mr. Gardner disclaims such beneficial ownership.
(5) Represents shares held by Lord Abbett & Co. ("Abbett") which has the sole
power to vote and dispose of the shares held by it. Abbett is owned by
eight individuals who participate in the management of the firm's
investment activities. Therefore, Abbett and the eight individuals may be
deemed beneficial owners of all shares held by Abbett.
(6) Dimensional Fund Advisors, Inc., ("Dimensional"), an investment advisor
registered under Section 203 of the Investment Advisors Act of 1940,
furnishes investment advise to four investment companies registered under
the Investment Company Act of 1940, and serves as investment manager to
certain other investment vehicles, including commingled group trusts.
(These investment companies and investment vehicles are the "Portfolios").
In its role as investment advisor and investment manager, Dimensional
possesses both voting and investment power over 495,500 shares of the
Company's stock as of September 30, 1999. The Portfolios own all securities
reported in this statement, and Dimensional disclaims beneficial ownership
of such securities.
(7) Represents shares held by State Street Research & Management Co. ("State")
which has the sole power to vote and dispose of the shares held by it.
State is a wholly owned subsidiary of Metropolitan Life Insurance Company
("Metropolitan"). Metropolitan may be deemed to share the power to vote and
dispose of all shares held by State, and State may be deemed to share the
power to vote and dispose of all shares held by itself. Therefore, both
Metropolitan and State each may be deemed a beneficial owner of all the
shares held.
(8) Represents shares held by Putnam Investment Management Inc. ("Putnam")
which has the sole power to vote and dispose of the shares held by it.
Putnam is a wholly owned subsidiary of Marsh & McLennan Companies, Inc.
("MMC"). MMC may be deemed to share the power to vote and dispose of all
shares held by itself or Putnam. Therefore, both Putnam and MMC each may be
deemed a beneficial owner of all the shares held by Putnam.
(9) Includes shares which certain officers and directors have the right to
acquire within 60 days after the date of this table pursuant to outstanding
options as follows: Mr. Corr, 7,441 shares; Dr. Madni, 1,166 shres; Dr.
Wan, 1,166 shares; Mr. Wrench, 1,333 shares; and all executive officers and
directors as a group, 11,106 shares. Also includes shares which certain
officers and directors have the right to vote pursuant to unvested portions
of restricted stock awards as follows: Mr. Brooks, 6,800 shares; Mr. Brown,
14,790 shares; Mr. Corr, 14,180 shares; Dr. Howard, 3,400; Dr. Madni,
66,550 shares; Dr. Mehrabian, 3,400; Dr. Wan, 22,521 shares; Mr. Wrench,
45,700 shares; and all executive officers and directors as a group, 177,441
shares.
(10) Includes 30,528 shares held in a revocable trust of which Mr. Brown and his
wife, Mildred S. Brown, are beneficiaries and sole trustees. Mr. and Mrs.
Brown, acting alone, each have the power to vote and dispose of such
shares.
(11) Includes 45,276 shares held in a revocable trust of which Mr. Wrench and
his wife, Jacqueline Wrench, are beneficiaries and sole trustees. Mr. and
Mrs. Wrench, acting alone, each have the power to vote and dispose of such
shares. Also includes 20,743 shares which Mr. Wrench, acting alone, has
power to vote and dispose of.
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(12) Includes 15,871 shares held jointly by Mr. Corr and his wife, Wendy A.
Corr. Mr. and Mrs. Corr, acting alone, each have the power to vote and
dispose of such shares.
(13) Includes the shares described in the Notes above, as applicable
</FN>
</TABLE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors and executive officers, and
persons who own more than ten percent of the Company's Common Stock, to file
with the Commission initial reports of ownership and reports of changes in
ownership of Common Stock of the Company. Officers, directors and greater than
ten percent stockholders are required by the Commission's regulations to furnish
the Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended October 2, 1999, the
Company's officers, directors and greater than ten percent beneficial owners
complied with all applicable Section 16(a) filing requirements.
EXECUTIVE COMPENSATION
Compensation of Directors
During fiscal 1999, each non-employee director of the Company received
a monthly fee of $1,000. Each non-employee director of the Company also received
a fee of $500 for each Board meeting attended and for each committee meeting
attended by that committee member and a fee of $250 for each telephone
conference Board meeting in which such director participated. In the fiscal year
ended October 2, 1999, the total compensation paid by the Company to
non-employee directors for services as directors was $75,000. The members of the
Board of Directors are eligible for reimbursement for their expenses incurred in
connection with attendance at Board meetings in accordance with Company policy.
Compensation of Executive Officers
Summary of Compensation
As noted above, the Company became an independent public company on
September 27, 1997 as a result of the Distribution. Prior to that date, the
businesses of the Company were controlled by Electronics and all compensation
decisions for persons who are now executive officers of the Company were
determined by Electronics.
The following table shows, for the fiscal years ended October 2, 1999,
October 3, 1998 and September 27, 1997, compensation awarded or paid to or
earned by the Company's Chief Executive Officer and its four other most highly
compensated executive officers (the "Named Executive Officers") for services
rendered by them as executive officers of Technologies in the fiscal years ended
October 2, 1999 and October 3, 1998 and of Electronics in the fiscal year ended
September 27, 1997. The Named Executive Officers held positions with Electronics
in fiscal 1997 which were comparable in scope and responsibility to those held
in the Company at the end of fiscal 1998 and 1999. The Named Executive Officers
did not earn compensation from the Company in fiscal 1997. The amounts reported
below for fiscal 1997 were earned by the individuals for services rendered to
Electronics in those years and were paid by that entity.
8
<PAGE>
<TABLE>
Summary Compensation Table
<CAPTION>
Annual
Compensation (l) Long Term Compensation Awards
------------------------------------ -------------------------------------------
Restricted Securities
Stock Underlying All Other
Name and Salary(2) Bonus Awards(3) Options Compensation
Principal Position Year ($) ($) ($) (#) ($)
------------------ ---- ------- ------- ------ ----- -----
<S> <C> <C> <C> <C> <C> <C>
Mr. Charles Crocker ................... 1999 334,125 100,000 0 0 5,928
Chairman of the Board, 1998 341,725 40,000 0 0 6,158
President and Chief 1997 341,400 50,000 0 0 4,707
Executive Officer
Mr. Gary D. Wrench .................... 1999 298,020 75,000 346,000 4,000 5,928
Senior Vice President and 1998 298,000 40,000 0 62,696 6,158
Chief Financial Officer 1997 282,000 80,000 63,750 0 5,102
Dr. Asad M. Madni ..................... 1999 269,355 90,000 64,813 5,000 6,117
Vice President 1998 334,956 40,000 120,000 21,472 6,240
President, BEI Sensors & 1997 290,239 65,000 315,000 0 5,823
Systems Company, Inc.
Dr. Lawrence A. Wan ................... 1999 245,423 40,000 54,313 3,500 10,362
Vice President, 1998 244,922 13,500 84,000 0 8,840
Corporate Technology 1997 217,043 33,000 53,125 0 8,463
Mr. Robert R. Corr .................... 1999 169,800 30,000 50,813 3,000 5,622
Secretary, Treasurer 1998 167,400 20,000 60,000 6,441 5,609
and Controller 1997 159,600 45,000 31,875 0 4,400
<FN>
- ------------
(1) As permitted by rules promulgated by the Commission, no amounts are shown
for "Other Annual Compensation" because no Named Executive Officer received
"perquisites" in an amount exceeding the lesser of 10% of bonus plus salary
or $50,000.
(2) Includes (i) annual cash payments designated as automobile allowances,
which did not exceed $12,000 for any individual in any year, (ii) includes
earned but deferred at the election of the Named Executive Officer pursuant
to the Company's Deferred Compensation Plan, and (ii) $31,550 in fiscal
year 1998 of accrued vacation pay deferred by Dr. Madni.
(3) Represents the dollar value of shares awarded, calculated by multiplying
the market value based on the closing sales price on the date of grant by
the number of shares awarded. As a result of the Distribution in 19997,
each holder of restricted stock granted under Electronics' 1992 Restricted
Stock Plan ("Electronics Restricted Stock") received vested and unvested
shares of the Company's Common Stock in amounts equal to the number of
vested and unvested shares of Electronics Restricted Stock held by such
holder on the record date for the Distribution. At October 2, 1999, the
aggregate holdings and value of restricted stock held by the Named
Executive Officers (based on the number of shares held at fiscal year-end
multiplied by the closing sales price of the Company's Common Stock as
reported on the Nasdaq National Market on October 2, 1999) was as follows:
Mr. Wrench, 87,468 shares, valued at $1,049,616; Dr. Madni, 77,204 shares,
valued at $926,448; Dr. Wan, 32,750 shares, valued at $393,000; and Mr.
Corr, 24,000 shares, valued at $288,000. Generally, the restrictions on
awards of restricted stock lapse with respect to 15% of the total number of
shares per year on the first, second, third, fourth and fifth anniversaries
of the date of grant and with respect to the remaining shares subject to
such award on the sixth anniversary of the date of grant. Dividends are
paid on shares of restricted stock when, as and if the Board declares
dividends on the Common Stock of the Company.
(4) Includes $4,800, $4,800, $3,549, $4,316 and $4,928 paid in fiscal 1999 to
Crocker, Wrench, Madni, Wan and Corr, respectively, and $4,800, $4,800,
$3,559, $4,222 and $4,774 paid in fiscal 1998 to Crocker, Wrench, Madni,
Wan and Corr, respectively, and $3,253, $3,648, $3,675, $3,884 and $3,549
paid in fiscal
9
<PAGE>
1997 to Crocker, Wrench, Madni, Wan and Corr, respectively, as a normal
contribution pursuant to the Company's Retirement Savings Plan. The
remaining sum for each Named Executive Officer is attributable to premiums
paid by the Company for group term life insurance.
</FN>
</TABLE>
Stock Option Grants and Exercises
The Company granted options to its executive officers and key employees
under the 1997 Equity Incentive Plan. In connection with the Distribution,
holders of options to purchase Common Stock of Electronics that were not
exercised prior to the Distribution had such options converted to vested and
unvested incentive stock options and nonstatutory stock options, as appropriate,
to purchase the Company's Common Stock issued under the 1997 Equity Incentive
Plan. The number of shares of the Company's Common Stock subject to options
issued in the conversion was determined by criteria which included the aggregate
fair market value of each option to purchase Electronics' Common Stock
immediately prior to the Distribution and the intent to issue options to
purchase the Company's Common Stock that were not more favorable to the holder
than those options held on Electronics' Common Stock that converted as a result
of the Distribution. For further information, see "The Distribution--Other
Consequences of the Distribution--Stock Options" in the Information Statement
included as an exhibit to the Company's Form 10. The Company has not issued any
stock appreciation rights. As of December 31, 1999, options to purchase a total
of 253,665 shares had been granted and were outstanding under the 1997 Equity
Incentive Plan and options to purchase 698,147 shares remained available for
grant thereunder. The following table shows, for fiscal 1999, certain
information regarding options for the Company's Common Stock exercised, and
options held at year-end, by the Named Executive Officers.
<TABLE>
Option Grants in Fiscal Year 1999
<CAPTION>
Potential Realizable Value at
Number of % of Total Assumed Annual
Securities Options Market Rates of Stock
Underlying Granted to Price at Price Appreciation for
Options Employees Exercise Date of Option Term(3)
Granted in Fiscal Price Grant Expiration ---------------------------
Name (#)(1) Year(2) ($/Sh) ($/Sh) Date 0% 5% 10%
---- ------ ------- ------ ------ ---- ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Mr. Crocker .................. 0 -- -- -- -- -- -- --
Mr. Wrench ................... 4,000 4.7% 7.000 7.000 10/05/08 -- 17,609 44,625
Dr. Madni .................... 5,000 5.8% 7.000 7.000 10/05/08 -- 22,011 55,781
Dr. Wan ...................... 3,500 4.1% 7.000 7.000 10/05/08 -- 15,408 39,047
Mr. Corr ..................... 3,000 3.5% 7.000 7.000 10/05/08 -- 13,207 33,469
<FN>
- ------------
(1) Options generally vest annually over a 3-year period. The options will
fully vest upon a change in control, as defined in the Company's 1997 Plan.
(2) Based upon options to purchase 86,000 shares issued to employees in fiscal
year 1999.
(3) The potential realizable value is based on the term of the option at its
time of grant. It is calculated by assuming that the stock price on the
date of grant appreciates at the indicated rate, compounded annually for
the entire term of the option and the option is exercised solely on the
last day of its term for the appreciated price. These amounts represent
certain assumed rates of appreciation less the exercise price, in
accordance with the rules of the Commission, and do not reflect the
Company's estimate or projection of future stock price performance. Actual
gains, if any, are dependent on the actual future performance of the
Company's Common Stock and no gain to the optionee is possible unless the
stock price increases over the option term, which will benefit all
stockholders.
</FN>
</TABLE>
10
<PAGE>
<TABLE>
Aggregated Option Exercises in Last Fiscal Year and FY-End Option Values
<CAPTION>
Number of Securities Value of Unexercised In-
Shares Underlying Unexercised the-Money Options at
Acquired on Value Options at FY-End (#) FY-End ($)
Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable(1) Unexercisable(2)
---- -------- -------- ---------------- ----------------
<S> <C> <C> <C> <C>
Mr. Crocker ............. 0 0 0/0 0/0
Mr. Wrench .............. 0 0 0/4,000 0/20,000
Dr. Madni ............... 0 0 0/5,000 0/25,000
Dr. Wan ................. 0 0 0/3,500 0/17,500
Mr. Corr ................ 0 0 6,441/3,000 26,292/15,000
<FN>
- ------------
(1) Includes both "in-the-money" and "out-of-the-money" options.
(2) The fair market value of the underlying shares of the Company's Common
Stock on October 2, 1999, less the exercise price.
</FN>
</TABLE>
Management Incentive Bonus Plan
The Company's Board of Directors adopted a Management Incentive Bonus
Plan for fiscal 1999 ("MIB Plan") covering employees of the Company and Sensors
& Systems. On the basis of goals relating to return on equity, and subject to
predetermined limits under the MIB Plan, the Company's Compensation Committee
will in its discretion determine a bonus fund for each company following the end
of the year. Based upon recommendations from management of each company, the
Compensation Committee may, in its discretion, approve individual awards to
employees of the respective companies, subject to final approval by the
Company's Board of Directors.
Incentive awards totaling approximately $951,500 were made with respect
to the Company's fiscal year 1999. The amounts of such incentive payments to the
Named Executive Officers are included in the "Bonus" column of "Summary
Compensation Table" under "Executive Compensation."
Employment Agreements
The employment arrangements between the Company and Mr. Wrench, Senior
Vice President, Chief Financial Officer and a director of the Company, provide
that if Mr. Wrench is terminated by the Company, he will receive from the
Company his then full-time current salary for 12 months after such termination.
The employment arrangements between the Company and Dr. Madni, Vice
President of the Company and President of Sensors & Systems, renew annually on
the anniversary date of the agreement. They further provide that if the Company
terminates him without cause or a change in control of the Company occurs, and
he executes a general release of liability, Dr. Madni will receive from the
Company his then current full-time salary and medical, dental and life insurance
benefits for the 12 months following the termination of his employment, his
annual bonus prorated to the date of termination of his employment and an amount
equal to the average of the bonuses paid Dr. Madni over the prior 3 completed
fiscal years. The employment arrangements include an agreement that Dr. Madni
will refrain from activities of a competitive nature for a period of 2 years
after termination of his employment with the Company.
Executive Change of Control Benefits Agreements
The Company has entered into Executive Change of Control Benefits
Agreements (the "Change of Control Agreements") with Messrs. Crocker, Corr,
Madni, Wan and Wrench. Pursuant to the terms of the Change of Control
Agreements, each executive officer would receive a single payment equal to the
sum of his annual salary and the average of his annual bonuses for the prior
three years upon the occurrence of a voluntary termination of employment by the
employee or an involuntary termination of employment without cause within 12
months after a change in control of the Company, as defined in the Change of
11
<PAGE>
Control Agreements. In addition, the Company would pay medical benefits on
behalf of the executive officer and his dependents until the executive officer
is again employed, but not longer than 18 months.
Compensation Committee Interlocks and Insider Participation
As noted above, the Compensation Committee consists of Messrs. Brown,
Brooks and Giroir. Mr. Brown retired in July 1990 as President of Electronics
and served as a consultant to Electronics until June 30, 1997. Mr. Giroir served
as Corporate Secretary of Electronics until February 1995 for which he received
no compensation in addition to that received as director's fees.
Report of the Compensation Committee of the Board of Directors(1)
The Compensation Committee is composed of Messrs. Brown, Brooks and
Giroir. The Committee is responsible for, among other things, setting the
compensation of executive officers, including any stock based awards to such
individuals under the Company's 1997 Equity Incentive Plan.
Executive Compensation Principles
The Committee seeks to compensate executive officers in a manner
designed to achieve the primary goal of the BEI Technologies, Inc. stockholders
increased stockholder value. In furtherance of this goal, the Committee
determined a compensation package that took into account both competitive and
performance factors. Annual compensation of Technologies executives is composed
of salary, bonus and stock incentives, an approach consistent with the
compensation programs of most electronics companies. A substantial portion of
the cash compensation of each executive officer is contingent upon Technologies'
performance. Bonuses, therefore, could be substantial, could vary significantly
from year to year, and could vary significantly among executive officers. The
Company's Compensation Committee continues to follow this approach and to be
guided by the same principles. Stock-based awards also continue to be a part of
the Technologies' executive officers' compensation.
Base Salary
The Compensation Committee determined salaries for fiscal 1999 for all
executive officers at its meeting of October 1, 1998. In adjusting the base
salary of the executive officers, the Committee examined both competitive and
qualitative factors relating to corporate and individual performance. In
connection with its examination of competitive factors, the Committee reviewed
an independent survey of base salaries paid by other electronics companies of
comparable size. In many instances, assessment of qualitative factors
necessarily involved a subjective assessment by the Committee. In determining
salary adjustments for executive officers for fiscal 1999, the Committee relied
primarily on the evaluation and recommendations by Mr. Crocker of each officer's
responsibilities for fiscal 1999 and performance during fiscal 1998.
Management Incentive Bonus Plan
The Company's Board of Directors adopted a Management Incentive Bonus
Plan (the "MIB Plan") for fiscal 2000 covering employees of the Company and of
Sensors & Systems. On the basis of goals relating to return on equity, and
subject to predetermined limits under the MIB Plan, the Company's Compensation
Committee, will in its discretion, determine a bonus fund for each company
following the end of the year. Based upon recommendations from the management of
each company, the Compensation Committee may, in its discretion, approve awards
to employees of the respective companies, subject to final approval of the
Company's Board of Directors.
- ------------
(1) This Section is not "soliciting material," is not deemed "filed" with the
Commission and is not to be incorporated by reference in any filing of the
Company under the Securities Act of 1933, as amended, or the Exchange Act,
whether made before or after the date hereof and irrespective of any
general incorporation language in any such filing.
12
<PAGE>
Incentive awards totaling $951,500 were made with respect to the
Company's fiscal 1999 year. Of that amount, $335,000 was awarded to the Named
Executive Officers.
Chief Executive Officer Compensation
In general, the factors utilized in determining Mr. Crocker's
compensation were similar to those applied to the other executive officers in
the manner described in the preceding paragraphs; however, a significant
percentage of his potential earnings was and continues to be subject to
consistent, positive, long-term performance of the Company.
Long Term Incentives
The Company intends to use the 1997 Equity Incentive Plan to further
align the interests of stockholders and management by creating common incentives
based on the possession by management of a substantial economic interest in the
long-term appreciation of the Company's stock. In determining the number of
restricted stock awards or stock options to be granted to an executive officer,
the Committee will take into account the officer's position and level of
responsibility within the Company, the officer's existing equity holdings, the
potential reward to the officer if the stock appreciates in the public market,
the incentives to retain the officer's services for the Company, the
competitiveness of the officer's overall compensation arrangements and the
performance of the officer. Based on a review of this mix of factors for fiscal
1999, the Committee granted incentive stock options to Mr. Wrench (4,000
shares), Mr. Corr (3,000 shares), Dr. Madni (5,000 shares) and Dr. Wan (3,500
shares). In addition, the Committee awarded restricted stock grants to Mr.
Wrench (36,000 shares), Mr. Corr (6,000 shares), Dr. Madni (8,000 shares) and
Dr. Wan (6,500) shares.
Section 162(m) of the Internal Revenue Code (the "Code") limits the
Company to a deduction for federal tax purposes of no more than $1 million of
compensation paid to certain Named Executive Officers in a taxable year.
Compensation above $1 million may be deducted if it is "performance-based
compensation" within the meaning of the Code. The Committee has determined that
stock options granted under the Company's 1997 Plan with an exercise price at
least equal to the fair market value of the Company's Common Stock on the date
of grant shall be rated as "performance-based compensation."
George S. Brown
Richard M. Brooks
C. Joseph Giroir, Jr.
13
<PAGE>
Performance Measurement Comparison(1)
The following graph shows the value of an investment of $100 in cash on
October 8, 1997, the first day of regular way trading on Nasdaq of (i) the
Company's Common Stock, (ii) the Nasdaq Stock Market Index (U.S. Companies) and
(iii) the Dow Jones Advanced Industrial Equipment Index. All values assume
reinvestment of the full amount of all dividends and are calculated as of the
last trading day of the applicable calendar quarter(2):
Comparison of 8 Quarter Cumulative Total Return on Investment
BEI Technologies, Inc.
Proxy Performance Graph
For the Year Ended 10/02/99
<TABLE>
[The following descriptive data is supplied in accordance with Rule 304(d) of
Regulation S-T]
BEI TECHNOLOGIES INC
<CAPTION>
Cumulative Total Return
-----------------------------------------------------------------------------------------
10/8/97 12/97 3/98 6/98 9/98 12/98 3/99 6/99 9/99
------ ----- ------ ------ ----- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
BEI TECHNOLOGIES, INC. 100.00 93.49 128.95 146.30 56.98 71.94 82.63 77.02 93.55
NASDAQ STOCK MARKET (U.S.) 100.00 90.46 105.86 108.77 98.23 127.47 142.58 156.00 159.56
DOW JONES ADVANCED INDUSTRIAL EQUIPMENT 100.00 87.85 87.71 77.75 65.16 80.53 71.24 98.59 106.24
<FN>
- ------------
(1) This Section is not "soliciting material," is not deemed "filed" with the
Commission and is not to be incorporated by reference in any filing of the
Company under the Securities Act of 1933, as amended or the Securities
Exchange Act of 1934, as amended, whether made before or after the date
hereof and irrespective of any general incorporation language in any such
filing.
(2) The Company operates on a fiscal year ending on the Saturday nearest
September 30. The calendar quarter end dates in the table above do not
necessarily coincide with the Company's fiscal quarter end dates.
(3) The Dow Jones reclassified their indices in 1999. Subsequently, the Dow
Jones Diversified Technology index the Company disclosed in the 1999 Proxy
Statement is now named the Dow Jones Advanced Industrial Equipment Index.
</FN>
</TABLE>
14
<PAGE>
CERTAIN TRANSACTIONS
The Company's By-Laws provide that the Company will indemnify its
directors and executive officers and may indemnify its other officers, employees
and other agents to the extent not prohibited by Delaware law. Under the
Company's By-Laws, indemnified parties are entitled to indemnification for
negligence, gross negligence and otherwise to the fullest extent permitted by
law. The By-Laws also require the Company to advance litigation expenses in the
case of stockholder derivative actions or other actions, against an undertaking
by the indemnified party to repay such advances if it is ultimately determined
that the indemnified party is not entitled to indemnification.
OTHER MATTERS
The Board of Directors knows of no other matters that will be presented
for consideration at the Annual Meeting. If any other matters are properly
brought before the meeting, it is the intention of the persons named in the
accompanying proxy to vote on such matters in accordance with their best
judgment.
By Order of the Board of Directors
/s/ Robert R. Corr
----------------------------------------
Robert R. Corr
Corporate Secretary
January 26, 2000
A copy of the Company's Annual Report to the Securities and Exchange Commission
on Form 10-K for the fiscal year ended October 2, 1999 is available without
charge upon written request to: Investor Relations, BEI Technologies, Inc., One
Post Street, Suite 2500, San Francisco, CA 94104.
15
<PAGE>
Appendix A
BEI TECHNOLOGIES, INC.
------------------
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 1, 2000
The undersigned hereby appoints Charles Crocker and Gary D. Wrench, and
each of them, as attorneys and proxies of the undersigned, with full power of
substitution, to vote all of the shares of stock of BEI Technologies, Inc. which
the undersigned may be entitled to vote at the Annual Meeting of Stockholders of
BEI Technologies, Inc. to be held at the Company's Systron Donner Inertial
Division, 2700 Systron Drive, Concord, California, on Wednesday, March 1, 2000
at 1:30 p.m. (local time), and at any and all postponements, continuations and
adjournments thereof, with all powers that the undersigned would possess if
personally present, upon and in respect of the following materials and in
accordance with the following instructions, with discretionary authority as to
any and all other matters that may properly come before the meeting.
UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR
ALL NOMINEES LISTED IN PROPOSAL 1 AND FOR PROPOSAL 2, AS MORE SPECIFICALLY
DESCRIBED IN THE PROXY STATEMENT. IF SPECIFIC INSTRUCTIONS ARE INDICATED, THIS
PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.
(Continued, and to be signed on the other side)
- --------------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
<PAGE>
<TABLE>
<S> <C> <C>
[X] Please mark
your votes
as this
MANAGEMENT RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTOR LISTED BELOW. MANAGEMENT RECOMMENDS A VOTE FOR PROPOSAL 2.
Proposal 1: WITHHOLD
FOR FOR ALL
To elect three directors to hold office [ ] [ ] Proposal 2: To ratify the selection of FOR AGAINST ABSTAIN
until the 2003 Annual Meeting of Ernst & Young LLP as independent public [ ] [ ] [ ]
Stockholders. accountants of the Company for its fiscal
year ending September 30, 2000.
Nominees: Richard M. Brooks, Willian G. Howard, Jr., and
Robert Mehrabian Please sign exactly as your name appears hereon. If the
each should sign. Executors, administrators, trustees,
To withhold authority to vote for any nominee(s) write such guardians and attorneys-in-fact should add their titles. If
nominee(s) name(s) below. signer is a corporation, please give full corporate name
and have a duly authorized officer sign, stating title. If
______________________________________ signer is a partnership, please sign in partnership name by
authorized person.
______________________________________
I PLAN TO ATTEND THE MEETING [ ]
COMMENTS/ADDRESS CHANGE [ ]
Please mark this box if you have written comments/ address change
on the reverse side.
Signature(s) ______________________________________________________________________________ Date ______________________________
PLEASE VOTE, DATE AND PROMPTLY RETURN THIS PROXY IN THE ENCLOSED RETURN ENVELOPE WHICH IS POSTAGE PREPAID IF MAILED IN THE UNITED
STATES.
- ----------------------------------------------------------------------------------------------------------------------------------
^ FOLD AND DETACH HERE ^
</TABLE>
