<PAGE> 1
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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
MERCURY COMPUTER SYSTEMS, INC.
(Name of Registrant as Specified In Its Charter)
NAME OF COMPANY
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the 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> 2
MERCURY COMPUTER SYSTEMS, INC.
199 RIVERNECK ROAD
CHELMSFORD, MA 01824
(978) 256-1300
Dear Stockholder:
Mercury Computer Systems, Inc. (the "Corporation") will hold a Special
Meeting of Stockholders (the "Meeting") in lieu of the 1998 Annual Meeting of
Stockholders on October 27, 1998 at the offices of Hutchins, Wheeler & Dittmar,
A Professional Corporation, 101 Federal Street, Boston, Massachusetts. We look
forward to your attending either in person or by proxy. The Notice of Meeting,
the Proxy Statement and the Proxy Card from the Board of Directors are enclosed.
These materials provide further information concerning the Meeting.
At this year's Meeting, the agenda includes the election of Class I
Directors and a proposal to approve the Corporation's 1998 Stock Option Plan for
Non-Employee Directors. The Board of Directors recommends that you vote FOR the
election of the slate of nominees for directors, and FOR approval of the
Corporation's 1998 Stock Option Plan for Non-Employee Directors.
Please refer to the enclosed Proxy Statement for detailed information on
each of these proposals. If you have any further questions concerning the
Meeting or any of the proposals, please feel free to contact the Corporation at
(978) 256-1300.
Sincerely yours,
[SIGNATURE OF JAMES R. BERTELLI]
JAMES R. BERTELLI
President and Chief Executive
Officer
<PAGE> 3
MERCURY COMPUTER SYSTEMS, INC.
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
IN LIEU OF THE 1998 ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 27, 1998
To the Stockholders:
A Special Meeting of the Stockholders of MERCURY COMPUTER SYSTEMS, INC. in
lieu of the 1998 Annual Meeting of Stockholders will be held on Tuesday, October
27, 1998, at 2:00 p.m. at the offices of Hutchins, Wheeler & Dittmar, A
Professional Corporation, Suite 3101, 101 Federal Street, Boston, Massachusetts,
for the following purposes:
1. To elect Dr. Albert P. Belle Isle as a Director for a term of three
years, as more fully described in the accompanying Proxy Statement.
2. To elect Mr. Melvin Sallen as a Director for a term of three years,
as more fully described in the accompanying Proxy Statement.
3. To approve the Mercury Computer Systems, Inc. 1998 Stock Option
Plan for Non-Employee Directors.
4. To consider and act upon any other business which may properly come
before the meeting.
The Board of Directors has fixed the close of business on August 28, 1998,
as the record date for the meeting. All stockholders of record on that date are
entitled to notice of and to vote at the meeting.
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING IN PERSON.
By order of the Board of Directors
[SIGNATURE OF ANTHONY J. MEDAGLIA, JR.]
ANTHONY J. MEDAGLIA, JR., Clerk
Chelmsford, Massachusetts
September 25, 1998
<PAGE> 4
MERCURY COMPUTER SYSTEMS, INC.
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Mercury Computer Systems, Inc. (the
"Corporation") for use at the Special Meeting of Stockholders in lieu of the
1998 Annual Meeting of Stockholders to be held on Tuesday, October 27, 1998, at
the time and place set forth in the notice of the meeting, and at any
adjournments thereof (the "Meeting"). The approximate date on which this Proxy
Statement and form of proxy are first being sent to stockholders is September
25, 1998.
VOTING AND REVOCABILITY OF PROXIES
If the enclosed proxy is properly executed and is received prior to the
Meeting, it will be voted in the manner directed by the stockholder. If no
instructions are specified with respect to any particular matter to be acted
upon, proxies will be voted in favor thereof. Any person giving the enclosed
form of proxy has the power to revoke it by voting in person at the meeting, or
by giving written notice of revocation to the Clerk of the Corporation any time
before the proxy is exercised.
The holders of a majority in interest of all Common Stock issued,
outstanding and entitled to vote are required to be present in person or be
represented by proxy at the meeting in order to constitute a quorum for the
transaction of business. The election of the nominees for Director will be
decided by plurality vote. Both abstentions and broker "non-votes" are counted
as present for the purposes of determining the existence of a quorum for the
transaction of business. However, for purposes of determining the number of
shares voting on a particular proposal, abstentions and broker "non-votes" are
not counted as votes cast or shares voting.
The Corporation will bear the cost of the solicitation. It is expected that
the solicitation will be made primarily by mail, but regular employees or
representatives of the Corporation (none of whom will receive any extra
compensation for their activities) may also solicit proxies by telephone,
telegraph and in person and arrange for brokerage houses and other custodians,
nominees, and fiduciaries to send proxies and proxy materials to their
principals at the expense of the Corporation.
The Corporation's principal executive offices are located at 199 Riverneck
Road, Chelmsford, Massachusetts 01824, telephone number (978) 256-1300.
RECORD DATE AND VOTING SECURITIES
Only stockholders of record at the close of business on August 28, 1998 are
entitled to notice of and to vote at the meeting. On that date the Corporation
had outstanding and entitled to vote 10,035,333 shares of Common Stock, par
value $.01 per share. Each outstanding share of the Corporation's Common Stock
entitles the record holder to one vote.
ELECTION OF DIRECTORS
Pursuant to Massachusetts law, the Board of Directors is divided into three
classes, with each class as nearly equal in number as possible. Presently, the
Board of Directors consists of six members, with Dr. Albert Belle Isle and Mr.
Melvin Sallen serving as Class I Directors; Dr. Gordon Baty and Mr. Sherman
Mullin serving as Class II Directors; and Mr. James Bertelli and Mr. R. Schorr
Berman serving as Class III Directors. The initial terms of the Class I, Class
II, and Class III Directors expire in 1998, 1999, and 2000, respectively.
Following expiration of its respective initial term, each class is then elected
for a subsequent three-year term.
<PAGE> 5
It is proposed that the Class I nominees listed below, whose terms expire
at this meeting, be elected to serve a term of three years and until their
successors are duly elected and qualified or until they sooner die, resign or
are removed.
The persons named in the accompanying proxy will vote, unless authority is
withheld, for the election of the nominees named below. If such nominees should
become unavailable for election, which is not anticipated, the persons named in
the accompanying proxy will vote for such substitute as the Board of Directors
may recommend. The nominees are not related to any Executive Officer of the
Corporation or its subsidiaries.
<TABLE>
<CAPTION>
YEAR FIRST POSITION WITH THE CORPORATION
ELECTED A OR PRINCIPAL OCCUPATION
NAME OF NOMINEE AGE DIRECTOR DURING PAST FIVE YEARS
--------------- --- ---------- --------------------------------------
<S> <C> <C> <C>
NOMINATED FOR A TERM ENDING IN 2001:
Dr. Albert P. Belle Isle.............. 55 1986 Dr. Belle Isle is an independent
investor in technology-based
companies, was President of Custom
Silicon, Inc., a semiconductor
company, and has also served as a Vice
President of Wang Laboratories, Inc.
and in various technical and business
management positions during fifteen
years with the General Electric
Company.
Melvin Sallen......................... 70 1990 Since 1991, Mr. Sallen has served as a
consultant to the Corporation in the
area of Japanese Strategies and Sales.
Mr. Sallen served as Senior Vice
President of Analog Devices, Inc. from
1966 through 1992. Since 1992, Mr.
Sallen has served as President of
Komon International, Inc., an
international consulting company. Mr.
Sallen is also a director of Tech On
Line, Inc. and Copley Controls
Corporation.
SERVING A TERM ENDING IN 1999:
Dr. Gordon B. Baty.................... 59 1983 Dr. Baty has been a partner of First
Stage Capital, Limited Partnership, a
venture capital firm, since 1986. Dr.
Baty was the founder and Chief
Executive Officer of Icon Corporation,
Context Corporation, and Wormser
Engineering, Inc. Dr. Baty is also a
Director of Novitron International,
Inc. and numerous private companies.
Sherman N. Mullin..................... 62 1994 Mr. Mullin served as President of
Lockheed Advanced Development Co., a
defense contractor, from 1990 through
1994. Mr. Mullin currently serves as
an ad-hoc advisor to the U.S. Air
Force Scientific Advisory Board.
</TABLE>
2
<PAGE> 6
<TABLE>
<CAPTION>
YEAR FIRST POSITION WITH THE CORPORATION
ELECTED A OR PRINCIPAL OCCUPATION
NAME OF NOMINEE AGE DIRECTOR DURING PAST FIVE YEARS
--------------- --- ---------- --------------------------------------
<S> <C> <C> <C>
SERVING A TERM ENDING IN 2000:
James R. Bertelli..................... 58 1981 Mr. Bertelli co-founded the
Corporation in 1981, and has served as
the Corporation's President, Chief
Executive Officer, and a Director
since that time. Prior to founding the
Corporation, Mr. Bertelli founded a
manufacturer's representative
organization after a brief period at
Analogic Corporation in sales
management positions. Prior to that,
Mr. Bertelli served as a marketing
manager for Digital Equipment
Corporation's telephone industry
products group. After a tour of duty
in the Army Signal Corps, Mr. Bertelli
began his high-tech career with RCA
Corporation as a computer systems
analyst, and later moved into computer
sales with RCA and Univac.
R. Schorr Berman...................... 50 1993 Mr. Berman is President and Chief
Executive Officer of MDT Advisors,
Inc., a venture capital firm. Mr.
Berman is also a director of Arch
Communications Group, Inc. and
numerous private companies.
</TABLE>
INFORMATION CONCERNING THE BOARD OF DIRECTORS
During fiscal year 1998, there were eleven meetings of the Board of
Directors of the Corporation, three meetings of the Audit Committee (see below)
and fourteen meetings of the Compensation Committee (see below). All of the
Directors 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
committees of the Board of Directors on which they served. The Board of
Directors does not have a nominating committee. Effective July 1, 1998, each
Director receives cash compensation in the amount of $9,000 for the fiscal year,
paid quarterly, plus an additional $2,000 for each meeting attended, as well as
reimbursement for reasonable expenses incurred in connection with attendance at
Board and committee meetings. As well, committee members and the committee
chairman receive an annual retainer of $1,000 and $1,750, respectively, paid
quarterly, as well as an additional $300 for attending a meeting not held on the
same day as a meeting of the Board of Directors. In addition to cash
compensation, Directors are also granted options pursuant to the 1993 Stock
Option Plan for Non-Employee Directors and, subject to stockholder approval of
the 1998 Stock Option Plan for Non-Employee Directors, will be granted options
pursuant to such Plan commencing on September 30, 1998.
The Board of Directors has a standing Audit Committee and Compensation
Committee. The members of the Audit Committee are Dr. Baty, Dr. Belle Isle and
Mr. Berman. The Audit Committee reviews the scope of the Corporation's
engagement of its independent public accountant and their reports. The Audit
Committee also meets with the financial staff of the Corporation to review
accounting procedures and reports. The Compensation Committee is comprised of
Dr. Baty and Messrs. Berman and Sallen. The Compensation Committee is authorized
to review and make recommendations to the Board of Directors regarding the
salaries and bonuses to be paid executive officers and to administer the
Corporation's various stock option and stock purchase plans.
3
<PAGE> 7
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal year 1998, Dr. Baty and Messrs. Berman and Sallen served as
the Compensation Committee of the Corporation's Board of Directors. During
fiscal year 1998, the Corporation had outstanding loans of (i) $200,000 to James
R. Bertelli, President of the Corporation, and (ii) $125,000 to Dr. Albert Belle
Isle, a Director of the Corporation. Both loans are due September 30, 1998, are
non-recourse, and currently bear interest at two percentage points above the
prime rate per annum.
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table shows, as of September 1, 1998, any person who is known
by the Corporation to be the beneficial owner of more than five percent of any
class of voting securities of the Corporation. For purposes of this Proxy
Statement, beneficial ownership is defined in accordance with Rule 13d-3 under
the Securities Exchange Act of 1934 and means generally the power to vote or
dispose of the securities, regardless of any economic interest therein.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENT OF
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
------------------- -------------------- ----------
<S> <C> <C>
Memorial Drive Trust(1)..................................... 2,454,786 24.5%
Massachusetts Mutual Life Insurance Company(2).............. 787,500 7.8%
R. Schorr Berman(3)......................................... 2,462,104 24.5%
</TABLE>
- ---------------
(1) The address of this beneficial owner is MDT Advisors, Inc., 125 Cambridge
Park Drive, Cambridge, MA, attention: R. Schorr Berman. Shares are held of
record by MD Co., a partnership organized by Memorial Drive Trust to hold
securities on behalf of Memorial Drive Trust.
(2) Includes 393,500 shares held of record by MassMutual Corporate Investors.
The address of these beneficial owners is 1295 State Street, Springfield, MA
01111.
(3) Includes options to purchase 4,818 shares exercisable within sixty days of
September 1, 1998. Includes 2,454,786 shares owned by MD Co., as to which
Mr. Berman may be deemed beneficial owner and as to which Mr. Berman
disclaims beneficial ownership except to the extent of his direct pecuniary
interest. Mr. Berman is President of MDT Advisors, Inc., which manages the
investments of MD Co. See note (1) above.
4
<PAGE> 8
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following information is furnished as of September 1, 1998, with
respect to Common Stock of the Corporation beneficially owned within the meaning
of Rule 13d-3 by all Directors of the Corporation and nominees, and by all
Directors and Executive Officers as a group. Unless otherwise indicated, the
individuals named held sole voting and investment power over the shares listed
below.
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT AND NATURE OF PERCENT OF
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
------------------- -------------------- ----------
<S> <C> <C>
James R. Bertelli(1)........................................ 455,160 4.5%
Donald Barry(2)............................................. 13,900 *
Vincent A. Mancuso(3)....................................... 5,000 *
G. Mead Wyman(4)............................................ 41,715 *
Gordon B. Baty(5)........................................... 113,875 1.1%
Albert P. Belle Isle(6)..................................... 45,818 *
R. Schorr Berman(7)......................................... 2,462,104 24.5%
Sherman N. Mullin(8)........................................ 15,353 *
Melvin Sallen(9)............................................ 26,449 *
All Directors and Executive Officers As a Group
(9 persons)(10)........................................... 3,179,374 31.7%
</TABLE>
- ---------------
* Less than 1.0%
(1) Includes options to purchase 35,360 shares exercisable within sixty days of
September 1, 1998.
(2) Includes options to purchase 12,900 shares exercisable within sixty days of
September 1, 1998.
(3) Includes options to purchase 5,000 shares exercisable within sixty days of
September 1, 1998.
(4) Includes options to purchase 5,715 shares exercisable within sixty days of
September 1, 1998.
(5) Includes options to purchase 5,450 shares exercisable within sixty days of
September 1, 1998.
(6) Includes options to purchase 4,818 shares exercisable within sixty days of
September 1, 1998.
(7) Includes options to purchase 4,818 shares exercisable within sixty days of
September 1, 1998. Also includes 2,454,786 shares owned by MD Co., as to
which Mr. Berman may be deemed beneficial owner and as to which Mr. Berman
disclaims beneficial ownership except to the extent of his direct pecuniary
interest. Mr. Berman is President of MDT Advisors, Inc., which manages the
investments of MD Co. See footnote (1) in "Principal Holders of Voting
Securities" above.
(8) Includes options to purchase 14,103 shares exercisable within sixty days of
September 1, 1998.
(9) Includes options to purchase 5,399 shares exercisable within sixty days of
September 1, 1998 and 2,800 shares owned by the Lois S, Sallen Trust, of
which Mr. Sallen is a co-trustee and beneficiary.
(10) Includes 93,563 shares which certain Directors and Executive Officers have
the right to acquire upon the exercise of outstanding options, exercisable
presently or within sixty days.
5
<PAGE> 9
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE
CORPORATION'S PREVIOUS FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, THAT MIGHT INCORPORATE FUTURE
FILINGS, INCLUDING THIS PROXY STATEMENT, IN WHOLE OR IN PART, THE FOLLOWING
REPORT AND THE PERFORMANCE GRAPH ON PAGE 8 SHALL NOT BE INCORPORATED BY
REFERENCE INTO ANY SUCH FILING.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Board of Directors has
furnished the following report on executive compensation.
The Committee administers the Corporation's stock option plans, makes
annual recommendations to the full Board of Directors regarding the chief
executive officer's salary, bonus, and equity-based compensation, and oversees
the executive compensation program for the Corporation's other pension
employees, including its executive officers. The Committee is composed of three
independent directors who are not employees of the Corporation.
COMPENSATION PHILOSOPHY
The Corporation's compensation policies for executive officers are based on
the belief that the interests of executives should be closely aligned with those
of the Corporation's shareholders. The compensation policies are designed to
achieve the following objectives:
- Offer compensation opportunities that attract highly qualified
executives, reward outstanding initiative and achievement, and retain
the leadership and skills necessary to build long-term shareholder
value.
- Maintain a significant portion of executives' total compensation at
risk, tied to both the annual and long-term financial performance of the
Corporation and the creation of shareholder value.
- Further the Corporation's short and long-term strategic goals and values
by aligning compensation with business objectives and individual
performance.
EXECUTIVE COMPENSATION
Compensation of executive officers other than the chief executive officer
is determined by the chief executive officer. The Committee historically has
obtained outside survey data regarding executive and senior level compensation
and provided this data to the chief executive officer to assist him in making
compensation decisions. Compensation for executive officers is comprised of base
salary, annual cash bonuses and periodic stock option grants.
Base Salary. Annual determinations of base salaries are made based on the
competitive pay practices of companies in the same industry of similar size and
market capitalization, the skills, performance level, and contribution to the
business of the individual executives, and the needs of the Corporation.
Annual Cash Incentive Awards. The Corporation's executive officers are
eligible to receive annual cash bonus awards designed to motivate executives to
attain short-term and longer-term corporate and individual management goals.
Award levels vary depending upon the achievement of performance criteria
established by the chief executive officer. The bonus criteria for each
executive officer are tailored to the achievement of financial and operational
goals specifically developed for that officer's area of responsibility, as well
as overall corporate performance and the attainment of other individual
objectives. Consequently, there is a direct link between the compensation of the
executive officers and the Corporation's performance.
6
<PAGE> 10
Long-Term Incentives. The Committee believes that stock options are an
excellent vehicle for compensating its officers and employees. The Corporation
provides long-term incentives through its stock option plans, a purpose of which
is to create a direct link between executive compensation and increases in
shareholder value. Stock options are granted at fair market value and vest in
installments, generally over five years. When determining option awards for an
executive officer, the Committee considers the executive's current contribution
to Corporation performance, the anticipated contribution to meeting the
Corporation's long-term strategic performance goals, and industry practices and
norms. Long-term incentives granted in prior years and existing levels of stock
ownership are also taken into consideration. Because the receipt of value by an
executive officer under a stock option is dependent upon an increase in the
price of the Corporation's Common Stock, this portion of the executive's
compensation is directly aligned with an increase in shareholder value.
CHIEF EXECUTIVE COMPENSATION
The chief executive officer's compensation is comprised of base salary,
annual cash incentive awards and stock option grants.
In determining the base salary paid to Mr. Bertelli for the year ended June
30, 1998, the Committee considered his level of responsibility, salary increases
awarded to him in the past, his experience, his potential, and compensation
programs of other companies of similar size and characteristics.
Annual cash bonuses and stock option grants to Mr. Bertelli are based on
the attainment of individual and corporate performance targets established at
the beginning of the fiscal year. The annual cash bonus and option grants to Mr.
Bertelli for the fiscal year ended June 30, 1998 reflect the achievement of
predetermined targets based on the Corporation's revenue, pre-tax income, and
certain non-financial goals.
Mr. Bertelli's base compensation increased 6%, from $260,000 during the
fiscal year ended June 30, 1997 to $275,000 during the fiscal year ended June
30, 1998. Mr. Bertelli's cash bonus of $116,600 and grant of options to purchase
14,119 shares of common stock in respect of the fiscal year ended June 30, 1998,
were based upon achievement of a significant portion of the pre-determined
targets described above. Mr. Bertelli's cash bonus and stock option grant
reflect increases in the Corporation's revenues and pre-tax profits of 32% and
88% respectively, from fiscal 1997 to fiscal 1998.
In 1993, the Internal Revenue Code was amended to limit the deduction a
public company is permitted for compensation paid in 1994 and thereafter to the
chief executive officer and to the four most highly compensated executive
officers, other than the chief executive officer. Generally, amounts paid in
excess of $1,000,000 to a covered executive, other than performance-based
compensation, cannot be deducted. In order to qualify as performance-based
compensation under the new tax law, certain requirements must be met, including
approval of the performance measures by the stockholders. The Committee intends
to consider ways to maximize deductibility of executive compensation, while
retaining the discretion the Committee considers appropriate to compensate
executive officers at levels commensurate with their responsibilities and
achievements.
The foregoing report has been approved by all members of the Committee.
COMPENSATION COMMITTEE
Melvin J. Sallen, Chairman
Gordon B. Baty
R. Schorr Berman
7
<PAGE> 11
PERFORMANCE GRAPH
Set forth below is a line graph comparing the cumulative total stockholder
return of the Corporation's Common Stock against the cumulative total return of
the Media General ("MG") Group 810 Diversified Computer Systems Index
(consisting of 14 companies) and the NASDAQ Market Index for the period January
30, 1998 through June 30, 1998. The graph and table assume that $100 was
invested on January 30, 1998 in each of the Corporation's Common Stock, the MG
Group 810 Diversified Computer Systems Index, and the NASDAQ Market Index and
that all dividends were reinvested. This data was furnished by Media General
Financial Services, Richmond, Virginia.
[MERCURY COMPUTER SYSTEMS, INC. PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
COMPANY/ 1/30/98 2/27/98 3/31/98 4/30/98 5/29/98 6/30/98
INDEX/MARKET
<S> <C> <C> <C> <C> <C> <C>
Mercury Computer Systems, Inc.......... 100.00 144.64 164.29 157.14 150.00 138.10
MG Group Index......................... 100.00 107.10 103.25 116.11 109.77 108.23
NASDAQ Market Index.................... 100.00 109.55 112.72 115.21 109.28 116.62
</TABLE>
8
<PAGE> 12
EXECUTIVE OFFICERS
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- -------------------------------------------
<S> <C> <C>
James R. Bertelli.......................... 58 President, Chief Executive Officer,
Director and Co-founder
G. Mead Wyman.............................. 58 Senior Vice President, Chief Financial
Officer and Treasurer
Donald Barry............................... 53 Vice President and Director of Medical
Business Group
Vincent A. Mancuso......................... 51 Vice President and Director of Government
Electronics Group
</TABLE>
MR. BERTELLI co-founded the Company in 1981, and has served as the
Company's President, Chief Executive Officer and a Director since that time. For
further information, see "Election of Directors."
MR. WYMAN was promoted to Senior Vice President, Chief Financial Officer
and Treasurer in September 1998. From November 1996 until his promotion, he
served as Vice President, Chief Financial Officer and Treasurer. Prior to
joining Mercury, Mr. Wyman was Chief Financial Officer at Dataware Technologies,
Inc., a software design firm, from 1992 to 1996. Previously, he was a general
partner at Hambrecht and Quist Venture Partners, and was the first Chief
Financial Officer at Lotus Development Corporation. Mr. Wyman also has held
senior financial management positions at Prime Computer Inc. and Millipore
Corporation.
DR. BARRY has been Vice President and Director of Medical Business Group
of the Company since 1992. Prior to that he served as General Manager at Picker
International, Inc., Chief Operating Officer at ESA, Inc., and Director of
International Marketing at American Motors Corp.
MR. MANCUSO joined the Company in January 1997 as Vice President and
Director of Government Electronics Group. Before joining Mercury, Mr. Mancuso
was Director of Federal Sales at Siemens Pyramid Information Systems, Inc., a
computer hardware firm formerly known as Pyramid Technology Corporation, from
1995 to 1996. From 1993 to 1995, he was Vice President of consulting at Federal
Sources, Inc., an information services company. From 1991 to 1992, he was Vice
President and General Manager at Government Technology Services, Inc., Advanced
Systems Division. Mr. Mancuso served nineteen years at Hewlett Packard in
various sales and marketing positions.
9
<PAGE> 13
EXECUTIVE COMPENSATION
The following table sets forth all compensation awarded to, earned by or
paid to the Corporation's Chief Executive Officer and each of the Corporation's
three other most highly compensated executive officers (the "Named Executive
Officers") for the Corporation's two most recent fiscal years ended June 30,
1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
-----------------------------
ANNUAL COMPENSATION SECURITIES
--------------------------------------------- UNDERLYING
OTHER ANNUAL OPTIONS/ ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($) SARS(#) COMPENSATION($)
- --------------------------- ---- --------- -------- --------------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
James R. Bertelli,
President and CEO............................ 1998 $275,000 $116,600 $6,000(1) 53,601 $28,194(2)
1997 $260,000 $112,300 $6,000(3) 22,290 $32,869(4)
G. Mead Wyman,
Senior Vice President, Treasurer and
CFO(5)..................................... 1998 $175,000 $ 50,620 -- -- $ 4,652(6)
1997 $100,000 $ 56,434 -- 80,000 $ 3,529(7)
Donald Barry,
Vice President and Director of Medical
Business Group............................. 1998 $120,000 $ 65,090 -- -- $ 3,200(8)
1997 $111,000 $ 64,020 -- 2,000 $ 2,160(9)
Vincent A. Mancuso,
Vice President and Director of Government
Electronics Group (10)..................... 1998 $120,000 $147,000 -- -- $ 3,200(11)
1997 $ 55,000 $ 75,000 -- 25,000 $ 1,400(12)
</TABLE>
- ---------------
(1) Represents automobile allowance.
(2) Represents $3,200 matching contribution by the Corporation into Mr.
Bertelli's 401(k) plan for the benefit of Mr. Bertelli, and a premium of
$24,994 paid by the Corporation for a split dollar life insurance policy
for the benefit of Mr. Bertelli.
(3) Represents automobile allowance.
(4) Represents $3,150 matching contribution by the Corporation into Mr.
Bertelli's 401(k) plan for the benefit of Mr. Bertelli, and a premium of
$29,719 paid by the Corporation for a split dollar life insurance policy
for the benefit of Mr. Bertelli.
(5) 1997 salary was earned from November 1996, when the Corporation hired Mr.
Wyman, through June 30, 1997.
(6) Represents $3,200 matching contribution by the Corporation into Mr. Wyman's
401(k) plan for the benefit of Mr. Wyman, and a premium of $1,452 paid by
the Corporation for a split dollar life insurance policy for the benefit of
Mr. Wyman.
(7) Represents $2,519 matching contribution by the Corporation into Mr. Wyman's
401(k) plan for the benefit of Mr. Wyman, and a premium of $1,010 paid by
the Corporation for a split dollar life insurance policy for the benefit of
Mr. Wyman.
(8) Represents $3,200 matching contribution by the Corporation into Mr. Barry's
401(k) plan for the benefit of Mr. Barry.
(9) Represents $2,160 matching contribution by the Corporation into Mr. Barry's
401(k) plan for the benefit of Mr. Barry.
(10) 1997 salary was earned from January 1997, when the Corporation hired Mr.
Mancuso, through June 30, 1997.
(11) Represents $3,200 matching contribution by the Corporation into Mr.
Mancuso's 401(k) plan for the benefit of Mr. Mancuso.
(12) Represents $1,400 matching contribution by the Corporation into Mr.
Mancuso's 401(k) plan for the benefit of Mr. Mancuso.
10
<PAGE> 14
STOCK OPTION AND STOCK PURCHASE PLANS
The Corporation has in effect its 1997 Stock Option Plan, 1993 Stock Option
Plan for Non-Employee Directors, 1991 Stock Option Plan, 1982 Stock Option Plan,
and 1997 Employee Stock Purchase Plan (together, the "Stock Option and Purchase
Plans"). The Corporation is no longer permitted to grant options under its 1982
Stock Option Plan or its 1991 Stock Option Plan; however, certain persons
continue to hold options to purchase shares of common stock granted thereunder.
The Compensation Committee of the Board of Directors is responsible for the
administration and interpretation of the Stock Option and Purchase Plans. Copies
of the Stock Option and Purchase Plans are available from the Clerk of the
Corporation upon request.
OPTION GRANTS, EXERCISES AND HOLDINGS
Option Grants. The following table sets forth certain information
regarding options granted to the Named Executive Officers during the year ended
June 30, 1998. The Corporation did not issue any SARs during the two most recent
fiscal years ended June 30, 1998.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
------------------------------------------------------- VALUE AT ASSUMED
NUMBER OF PERCENT OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTION/SARS PRICE APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM (1)
OPTION/SARS EMPLOYEES IN PRICE EXPIRATION ----------------------
NAME GRANTED (#) FISCAL YEAR (%) ($/SHARE) DATE 5%($) 10%($)
---- ----------- ---------------- --------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
James R. Bertelli (2).... 8,601 1.8% $4.00 4/8/07 21,636 54,831
45,000 9.6% $8.00 10/20/07 226,402 573,747
G. Mead Wyman............ -- -- -- -- -- --
Donald Barry(3).......... 10,000 2.1% $8.00 10/20/07 50,312 127,499
Vincent A. Mancuso....... -- -- -- -- -- --
</TABLE>
- ---------------
(1) In accordance with the rules of the Securities and Exchange Commission (the
"Commission"), shown are the gains or "option spreads" that would exist for
the respective options granted. These gains are based on the assumed rates
of annual compound stock price appreciation of 5% and 10% from the date the
option was granted over the full option term. These assumed annual compound
rates of stock price appreciation are mandated by the rules of the
Commission and do not represent the Corporation's estimate or projection of
future Common Stock prices.
(2) Options to purchase 4,301 of these shares were exercisable at June 30, 1998.
The remaining options vest as to 4,300 shares on September 8, 1998, and as
to 45,000 shares in increments of 11,250 shares on October 20 in each of
1998, 1999, 2000, and 2001 so long as Mr. Bertelli's employment with the
Corporation has not been terminated.
(3) These options vest in increments of 2,500 shares on October 20 in each of
1998, 1999, 2000 and 2001 so long as Mr. Barry's employment with the
Corporation has not been terminated.
11
<PAGE> 15
AGGREGATED OPTION EXERCISES IN LAST
FISCAL YEAR AND 6/30/98 OPTION VALUES
The following table provides information on option exercises and on the
value of the named Executive Officers' unexercised options at June 30, 1998.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT FISCAL YEAR-END AT FISCAL YEAR-END($)(1)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($)(2) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- -------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
James R. Bertelli....... -- -- 15,736 60,155 165,228 451,628
G. Mead Wyman........... 8,000 78,000 5,715 66,285 60,008 695,993
Donald Barry............ -- -- 11,030 10,970 120,815 75,185
Vincent A. Mancuso...... -- -- 5,000 20,000 -- --
</TABLE>
- ---------------
(1) Value of unexercised in-the-money stock options represents the difference
between the exercise prices of the stock options and the closing price of
the Corporation's Common Stock on The Nasdaq National Market on June 30,
1998.
(2) Value realized on exercise represents the difference between the exercise
prices of stock options exercised and the trading price of the Corporation's
Common Stock on The Nasdaq National Market on the date of such exercise.
APPROVAL OF 1998 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
There will be presented at the meeting a proposal to approve the Mercury
Computer Systems, Inc. 1998 Stock Option Plan for Non-Employee Directors (the
"1998 Non-Employee Director Plan"), which was adopted by the Corporation's Board
of Directors on June 15, 1998. The 1998 Non-Employee Director Plan is intended
to attract and retain the services of experienced and knowledgeable independent
Directors who are not employees of the Corporation through continuing ownership
of the Corporation's Common Stock. Under regulations of the Nasdaq Stock Market,
any plan providing for the grant of options to purchase more than 25,000 shares,
any of which may be granted to a Director, is to be approved by the
Stockholders. The Board of Directors recommends that the Stockholders approve
the 1998 Non-Employee Director Plan. The affirmative vote of the holders of at
least a majority of a quorum of the Corporation's Common Stock voting in person
or by proxy at the meeting will be required for such approval. Set forth below
is a summary of the principal provisions of the 1998 Non-Employee Director Plan.
A copy of the entire plan is available from the Clerk of the Corporation upon
request.
Terms and Provisions of Options. The 1998 Non-Employee Director Plan
provides for the grant of non-qualified options not intended to meet the
requirements of Section 422 of the Internal Revenue Code for the purchase of the
Corporation's Common Stock by each of the current non-employee Directors of the
Corporation and by each other person who is duly elected as a non-employee
Director of the Corporation subject to availability of shares under the 1998
Non-Employee Director Plan. The maximum number of shares for which options may
be granted under the 1998 Non-Employee Director Plan is 50,000 shares, subject
to adjustment for capital changes. Under the 1998 Non-Employee Director Plan,
the Corporation will grant to each non-employee Director on September 30th of
each year options to purchase that number of shares of Common Stock equal to 1%
of the net income of the Corporation for the most recent fiscal year ending
prior to the date of grant divided by the fair market value of a share of the
Corporation's Common Stock on the first day of such fiscal year, divided by the
number of non- employee Directors in office at the time of grant. Options
granted under the 1998 Non-Employee Director Plan will vest equally over three
years from the date of grant, with an exercise price equal to the per share fair
market value of the Corporation's Common Stock on
12
<PAGE> 16
the date of grant of the option. The closing price of the Corporation's Common
Stock on the Nasdaq National Market was $13.00 on September 14, 1998.
Options granted under the 1998 Non-Employee Director Plan generally are not
assignable or transferable by the optionee other than by will or by the laws of
descent and distribution or pursuant to a qualified domestic relations order.
The exercise price of options granted under the 1998 Non-Employee Director Plan
must be paid in full, in cash or by certified check, upon exercise; provided,
however, that there shall be no such exercise at any one time as to fewer than
the lesser of (i) 250 shares, or (ii) all of the remaining shares then
purchasable by the person exercising the option.
If the optionee ceases to be a Director of the Corporation, the option
granted to such optionee may only be exercised by the optionee within one month
after the date the optionee ceases to be a Director of the Corporation, unless
termination as a Director was (a) by the Corporation for cause, in which case
the option terminates immediately, (b) due to the optionee becoming permanently
disabled, or (c) due to the death of the optionee. If the optionee ceases being
a director as a result of permanent disability, then any options vested as of
the date such optionee ceases being a director may be exercised by the optionee
at any time within the following twelve months. In the event of the death of an
optionee, any option vested as of the date of death may be exercised by the
optionee's estate (or by any person who acquired the right to exercise such
option by reason of the death of the optionee) at any time within twelve months
of the optionee's death.
The number of shares issuable under the 1998 Non-Employee Director Plan
shall be adjusted to prevent dilution in the event of any reorganization,
merger, consolidation, recapitalization, reclassification, stock split,
combination of shares or stock dividend.
The 1998 Non-Employee Director Plan will terminate ten years from the date
on which it is approved by the stockholders, but the Board of Directors may at
any time terminate, modify or amend the plan as it deems advisable.
Following approval of the 1998 Non-Employee Director Plan by the
stockholders, no further options will be granted under the Corporation's 1993
Stock Option Plan for Non-Employee Directors.
TAX EFFECTS OF PLAN PARTICIPATION
Options granted under the 1998 Director Plan are intended to be
non-qualified stock options. No income is recognized by the optionee on the
grant of a non-qualified stock option. On the exercise by an optionee of a
non-qualified option, generally the excess of the fair market value of the stock
when the option is exercised over its cost to the optionee will be (a) taxable
to the optionee as ordinary income and (b) generally deductible for income tax
purposes by the Corporation.
The Internal Revenue Service will treat the exercise of a non-qualified
stock option with already owned stock of the Corporation of the same type (i.e.,
common or preferred but not "Nonqualified Preferred" stock as defined in Section
351(g)(2) of the Code) as two transactions. First, there will be a tax-free
exchange of the old shares for a like amount of new shares under Section 1036 of
the Code, with the new shares retaining the basis and holding periods of the old
shares. Second, the issuance of additional new shares (representing the spread
between the fair market value of all the new shares and the option price) is
taxable to the employee as ordinary income under Section 83 of the Code, as is
the case with any non-qualified option. The new shares will have a basis equal
to the spread between the fair market value of the new shares and the option
price.
The optionee's tax basis in his stock will equal his cost for the stock
plus the amount of ordinary income he had to recognize with respect to the
non-qualified stock option. Accordingly, upon a subsequent disposition of stock
acquired upon the exercise of a non-qualified option, the optionee will
recognize short-term or long-
13
<PAGE> 17
term capital gain or loss, depending upon the holding period of the stock equal
to the difference between the amount realized upon disposition of the stock by
the optionee and his basis in the stock.
OTHER MATTERS
Notice of Amendment to Corporation By-Laws Pursuant to sec.17 of the
Massachusetts General Corporation Law, Chapter 156B. On April 9, 1998, the
Board of Directors unanimously voted to amend the By-Laws of the Company by
making the following self-explanatory additions:
1. By adding the following language after the second sentence of the
first paragraph of Section 3.5:
Both abstentions and broker non-votes are to be counted as present
for the purpose of determining the existence of a quorum for the
transaction of business at any meeting.
2. By adding the following language after the last sentence of the
second paragraph of Section 3.5:
For purposes of determining the number of shares voting on a
particular proposal, abstentions and broker non-votes are not to
be counted as votes cast or shares voting.
3. By adding the following language after the last sentence of the
second paragraph of Section 3.7:
Both abstentions and broker non-votes are to be counted as present
for the purpose of determining the existence of a quorum for the
transaction of business at any meeting. However, for purposes of
determining the number of shares voting on a particular proposal,
abstentions and broker non-votes are not to be counted as votes
cast or shares voting.
Independent Public Accountants. The Board of Directors has appointed
PriceWaterhouseCoopers LLP as independent auditors to examine the consolidated
financial statements of the Corporation and its subsidiaries for the fiscal year
ended June 30, 1999.
A representative of PriceWaterhouseCoopers LLP is expected to be present at
the Meeting and will have the opportunity to make a statement if he or she so
desires and to respond to appropriate questions. The engagement of
PriceWaterhouseCoopers LLP was approved by the Board of Directors at the
recommendation of the Audit Committee of the Board of Directors.
Section 16(a) Beneficial Ownership Reporting Compliance. Section 16(a) of
the Securities Exchange Act of 1934 requires the Corporation's officers and
Directors and persons beneficially owning more than 10% of the outstanding
Common Stock of the Corporation to file reports of beneficial ownership and
changes in beneficial ownership with the Securities and Exchange Commission
("SEC"). Officers, Directors, and greater than 10% beneficial owners of Common
Stock are required by SEC regulation to furnish the Corporation with copies of
all Section 16(a) forms they file.
Based solely on copies of such forms furnished as provided above, or
written representations that no Forms 5 were required, the Corporation believes
that during the fiscal year ended June 30, 1998, all Section 16(a) filing
requirements applicable to its officers, Directors, and beneficial owners of
greater than 10% of its Common Stock were complied with, except: Mr. Melvin
Sallen, a Director of the Corporation, filed one late report relating to a
transaction in which a trust, of which Mr. Sallen was co-trustee and a
beneficiary, purchased shares of the Corporation.
Deadlines for Submission of Stockholder Proposals. Under regulations
adopted by the Securities and Exchange Commission, any proposal submitted for
inclusion in the Corporation's Proxy Statement relating to the Annual Meeting of
Stockholders to be held in 1999 must be received at the Corporation's principal
executive offices in Chelmsford, Massachusetts on or before May 14, 1999.
Receipt by the Corporation of any
14
<PAGE> 18
such proposal from a qualified stockholder in a timely manner will not ensure
its inclusion in the proxy material because there are other requirements in the
proxy rules for such inclusion. Stockholders interested in submitting such a
proposal are advised to contact knowledgeable counsel with regards to the
detailed requirements of such securities rules.
In addition to the Securities and Exchange Commission requirements
regarding stockholder proposals, the Corporation's By-Laws contain provisions
regarding matters to be brought before stockholder meetings. If stockholder
proposals, including proposals regarding the election of Director, are to be
considered at the 1999 Annual Meeting of Stockholders, notice of them whether or
not they are included in the Corporation's proxy statement and form of proxy,
must be given by personal delivery or by United States mail, postage prepaid, to
the Clerk of the Corporation on or before August 7, 1999.
Other Matters. Management knows of no matters which may properly be and
are likely to be brought before the meeting other than the matters discussed
herein. However, if any other matters properly come before the meeting, the
persons named in the enclosed proxy will vote in accordance with their best
judgment.
The cost of this solicitation will be born by the Corporation. It is
expected that the solicitation will be made primarily by mail, but regular
employees or representatives of the Corporation (none of whom will receive any
extra compensation for their activities) may also solicit proxies by telephone,
telegraph and in person and arrange for brokerage houses and other custodians,
nominees and fiduciaries to send proxies and proxy material to their principals
at the expense of the Corporation.
10-K REPORT. THE CORPORATION WILL PROVIDE EACH BENEFICIAL OWNER OF ITS
SECURITIES WITH A COPY OF AN ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL
STATEMENTS AND SCHEDULES THERETO, REQUIRED TO BE FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION FOR THE CORPORATION'S MOST RECENT FISCAL YEAR, WITHOUT
CHARGE, UPON RECEIPT OF A WRITTEN REQUEST FROM SUCH PERSON. SUCH REQUEST SHOULD
BE SENT TO MR. G. MEAD WYMAN, CHIEF FINANCIAL OFFICER, MERCURY COMPUTER SYSTEMS,
INC., 199 RIVERNECK ROAD, CHELMSFORD, MASSACHUSETTS 01824.
VOTING PROXIES
The Board of Directors recommends an affirmative vote on all proposals
specified. Proxies will be voted as specified. If signed proxies are returned
without specifying an affirmative or negative vote on any proposal, the shares
represented by such proxies will be voted in favor of the Board of Directors'
recommendations.
By order of the Board of Directors
[SIGNATURE OF ANTHONY J. MEDAGLIA, JR.]
ANTHONY J. MEDAGLIA, JR., Clerk
Chelmsford, Massachusetts
September 25, 1998
15
<PAGE> 19
1712-PS98
<PAGE> 20
PROXY
MERCURY COMPUTER SYSTEMS, INC.
SPECIAL MEETING IN LIEU OF
ANNUAL MEETING OF STOCKHOLDERS
OCTOBER 27, 1998
The undersigned hereby appoints James R. Bertelli and Anthony J. Medaglia, Jr.,
and each of them, with full power of substitution, proxies to represent the
undersigned at the Special Meeting in Lieu of the 1998 Annual Meeting of
Stockholders of Mercury Computer Systems, Inc. to be held on October 27, 1998 at
2:00 p.m. at the offices of Hutchins, Wheeler & Dittmar, A Professional
Corporation, 101 Federal Street, Suite 3101, Boston, Massachusetts, and at any
adjournment or adjournments thereof, to vote in the name and place of the
undersigned, with all powers which the undersigned would possess if personally
present, upon such business as may properly come before the meeting including
the proposals as set forth on the reverse side of this Proxy Card.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. THE BOARD
RECOMMENDS AN AFFIRMATIVE VOTE ON ALL PROPOSALS SPECIFIED. SHARES WILL BE VOTED
AS SPECIFIED. IF NO SPECIFICATION IS MADE, THE SHARES REPRESENTED WILL BE VOTED
IN FAVOR OF THE PROPOSALS.
PLEASE VOTE, DATE AND SIGN THIS PROXY IN THE SPACE PROVIDED AND RETURN IN THE
ENCLOSED ENVELOPE, WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING IN PERSON.
- ------------ -----------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
- ------------ -----------
<PAGE> 21
<TABLE>
<S> <C> <C>
[1712 - MERCURY COMPUTER SYSTEMS, INC.] [FILE NAME: MRC08A.ELX] [VERSION - 2] [09/16/98]
MRC08A DETACH HERE
- ----------------------------------------------------------------------------------------------------------------------------------
[X] PLEASE MARK
VOTES AS IN
THIS EXAMPLE
1. Election of Directors: FOR AGAINST ABSTAIN
NOMINEES: Dr. Albert P. Belle Isle and 2. Approval of the Mercury Computer [ ] [ ] [ ]
Mr. Melvin Sallen Systems, Inc. 1998 Stock Option
Plan for Non-Employee Directors:
FOR WITHHELD
[ ] [ ] 3. In their descretion, the proxies are authorized to vote upon
such other business as may properly come before the Meeting.
[ ] ______________________________________ MARK HERE IF YOU PLAN TO ATTEND THE MEETING [ ]
For both nominees except as noted above
MARK HERE FOR ADDRESS CHANGE AND NOTE CHANGES AT LEFT [ ]
PLEASE BE SURE TO DATE AND SIGN THIS PROXY.
Please sign exactly as your name(s) appear(s) in the Proxy. When
shares are held by joint tenants, both should sign. When signing
as attorney, executor, administrator, trustee or guardian, please
give full title as such. If a corporation, please sign in full
corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
Signature: _________________________ Date: _________________ Signature: ____________________________ Date: ___________________
</TABLE>
