<PAGE>
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 Commission Only
(as permitted by Rule 14c-6(e)(2))
/x/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
SAMES CORPORATION
- --------------------------------------------------------------------------------
(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 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>
SAMES CORPORATION
9201 WEST BELMONT AVENUE
FRANKLIN PARK, ILLINOIS 60131
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 25, 2000
TO THE STOCKHOLDERS OF
SAMES CORPORATION:
Notice is hereby given that the Annual Meeting of Stockholders of SAMES
CORPORATION (the "Company") will be held at the offices of Vedder, Price,
Kaufman & Kammholz, 26th Floor, 222 North LaSalle Street, Chicago, Illinois
60601, on Tuesday, April 25, 2000 at 9:00 a.m., for the purpose of
considering and acting upon the following matters:
1. The election of one director to the Board of Directors of the Company;
2. The approval of the Sames Employee Stock Purchase Plan;
3. The approval of an amendment to the Company's Amended and Restated
1996 Stock Option Plan;
4. The ratification of the appointment of KPMG LLP as the Company's
independent accountants for the fiscal year ending December 31, 2000; and
5. The transaction of such other business as may properly be brought
before the meeting and any adjournment thereof.
Stockholders of record at the close of business on Wednesday, March 1,
2000 are entitled to notice of and to vote at the Annual Meeting or any
adjournment thereof.
Whether or not you expect to be present at the Annual Meeting, you are
requested to execute and return the enclosed proxy.
By order of the Board of Directors,
Guy E. Snyder, SECRETARY
March 20, 2000
<PAGE>
SAMES CORPORATION
9201 WEST BELMONT AVENUE
FRANKLIN PARK, ILLINOIS 60131
PROXY STATEMENT
FOR
2000 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 25, 2000
INTRODUCTION
This proxy statement and the accompanying proxy are being furnished for
the solicitation of proxies by the Board of Directors of Sames Corporation
(the "Company") for use at the Annual Meeting of Stockholders to be held on
Tuesday, April 25, 2000 at 9:00 a.m., Chicago time, at the offices of Vedder,
Price, Kaufman & Kammholz, 26th Floor, 222 North LaSalle Street, Chicago,
Illinois 60601, or any adjournment thereof, for the purposes set forth in the
accompanying Notice of Annual Meeting of Stockholders. The proxy statement
and accompanying proxy are being first sent to stockholders on or about March
20, 2000.
ANNUAL REPORT
The Annual Report on Form 10-K of Sames Corporation for the fiscal year
ended November 30, 1999 is enclosed herewith.
PROPOSALS
The purpose of the Annual Meeting is to:
1. Elect one director to the Board of Directors of the Company;
2. Approve the Sames Employee Stock Purchase Plan;
3. Approve an amendment to the Company's Amended and Restated 1996 Stock
Option Plan;
4. Ratify the appointment of KPMG LLP as the Company's independent
auditors for the fiscal year 2000; and
5. Transact such other business as may properly come before the meeting
or any adjournment thereof.
- 1 -
<PAGE>
REVOCATION OF PROXIES AND SOLICITATION
The enclosed proxy may be revoked by a stockholder at any time prior to
the voting thereof by delivery of written notice of revocation to the
Secretary of the Company. It may also be revoked by a stockholder attending
and voting in person at the Annual Meeting or by delivery of a later dated
proxy to the Secretary of the Company prior to such voting.
The cost of solicitation of proxies will be borne by the Company.
Solicitation will be by mail and may also be by telephone, telegraph or in
person by employees of the Company, who will receive no additional
compensation for such solicitation. The Company does not now expect to pay
any compensation for the solicitation of proxies, but may reimburse brokers
and other persons holding shares in their names or in the names of nominees
for their expenses in sending proxy material to principals and obtaining
their proxies. Harris Trust and Savings Bank, the transfer agent and
registrar of the Company's capital stock, may aid in the solicitation of
proxies and will be reimbursed for any expenses incurred as a result of any
such activity.
VOTING SECURITIES
As of March 1, 2000, the record date for stockholders entitled to notice
of and to vote at the Annual Meeting (the "Record Date"), the outstanding
voting securities of the Company consisted of 2,931,035 shares of capital
stock, each share being entitled to one vote on each matter presented at the
meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
As of the Record Date, the following persons were believed by the
Company to beneficially own (as such term is defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) more than
5% of the outstanding shares of capital stock of the Company:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF NUMBER OF PERCENT
BENEFICIAL OWNER SHARES(1) OF CLASS
------------------- ---------- ---------
<S> <C> <C>
Kennedy Capital Management, Inc.
10829 Olive Blvd.
St. Louis, MO 63141 339,674(2) 11.59%
Harris Associates L.P.
Harris Associates Inc.
Two North LaSalle Street
Suite 500
Chicago, IL 60602 297,233(3) 10.14%
Woodland Partners LLC
60 South Sixth Street, Suite 3750
Minneapolis, MN 55402 264,150(4) 9.00%
Dimensional Fund Advisors, Inc.
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401 242,330(5) 8.27%
</TABLE>
- -------------------
(1) The nature of the beneficial ownership for shares shown in this column
is sole voting and investment power, except as set forth in the
following notes.
(2) According to a Schedule 13G filed with the SEC, dated February 9, 2000.
Kennedy Capital Management has sole dispositive power of all such
shares. It has sole voting power of 276,874 shares.
- 2 -
<PAGE>
(3) According to a Schedule 13G filed with the SEC, dated January 17, 2000.
Harris Associates L.P. and its general partner, Harris Associates Inc.
(collectively, "Harris"), share voting and dispositive power with
respect to 245,800 of the 297,233 shares, which are beneficially owned
by Harris Associates Investment Trust Series Designated The Oakmark
Smallcap Fund. Harris shares voting power of the remaining 51,433 shares
with various clients to which Harris acts as investment adviser. Harris
has sole dispositive power with respect to such 51,433 shares.
(4) According to a Schedule 13G filed with SEC, dated January 20, 2000.
Woodland Partners LLC has sole voting power of 228,950 of such shares.
Woodland Partners LLC shares voting power of 35,200 shares with various
clients for whom it manages accounts.
(5) According to a Schedule 13G filed with the SEC, dated February 4, 2000.
- 3 -
<PAGE>
PROPOSAL 1. ELECTION OF DIRECTORS
INFORMATION REGARDING DIRECTORS AND EXECUTIVE OFFICERS
The Company presently has five directors who are divided into three
classes serving staggered three year terms. One director is to be elected to
the Company's Board of Directors at this Annual Meeting to hold office for a
term expiring at the Annual Meeting for the year 2003. Dr. Wayne F. Edwards
has been nominated to fill such position. Unless otherwise specified in the
proxy, it is the present intention of the persons named in the accompanying
form of proxy to vote such proxies for his election. Mr. Clifford J. Vaughan
is currently a director of the Company with a term expiring at this year's
Annual Meeting. Mr. Vaughan has decided not to stand for re-election.
Accordingly, fewer nominees for director are named herein than the maximum
number of directors permitted by the Company's By-Laws. Additional nominees
for director are not being sought at this time. Proxies will not be voted for
more than the one nominee for director included in this Proxy Statement.
Directors shall be elected by an affirmative vote of a plurality of
votes of the shares present in person or represented by proxy and entitled to
vote at the Annual Meeting. Under applicable Delaware law, in tabulating the
vote, broker non-votes will be disregarded and will have no effect on the
outcome of the vote.
Although it is not anticipated, if Dr. Edwards is unable or
unwilling to serve as a director, proxies will be voted for such other person
as the Board of Directors may determine.
Information with respect to the nominee, continuing directors and
certain executive officers of the Company is shown below.
<TABLE>
<CAPTION>
CAPITAL STOCK OF THE
COMPANY
BENEFICIALLY OWNED ON
MARCH 1, 2000(1)
------------------------------------------
PERCENT OF
NUMBER OF CAPITAL STOCK
SHARES OUTSTANDING
------ -----------
<S> <C> <C>
NOMINEE FOR ELECTION AS DIRECTOR
DR. WAYNE F. EDWARDS, age 65, has been a director of the Company since 17,250(2) *
August 1996 and Chairman of the Board since August 1998. Dr. Edwards
served as interim President and CEO of the Company from August 1998
until the appointment of Arnold H. Dratt as President and CEO in
October 1998. Dr. Edwards, now retired, was Vice President and Chief
Financial Officer of Crown Zellerbach International, Inc. from 1975
to 1983.
CONTINUING DIRECTORS
ARNOLD H. DRATT, age 55, has been the President, CEO and a director of 121,500(3) 4.01%
the Company since October 1998. Mr. Dratt has served as President of
the Dratt-Campbell Company, a management consulting firm, since he
co-founded it in 1991. In such capacity, Mr. Dratt was a consultant
to the Company from January 1998 until September 1998. Mr. Dratt's
present term of office expires at the 2001 Annual Meeting.
- 4 -
<PAGE>
CAPITAL STOCK OF THE
COMPANY
BENEFICIALLY OWNED ON
MARCH 1, 2000(1)
------------------------------------------
PERCENT OF
NUMBER OF CAPITAL STOCK
SHARES OUTSTANDING
------ -----------
<S> <C> <C>
PHILIPPE VUILLERME, age 47, has been a director of the Company since 1,500 *
October 1999. Mr. Vuillerme is also an Executive Officer, joining the
Company on April 1, 1999, as Managing Director of Sames S.A. Prior to
joining the Company, Mr. Vuillerme was a managing director of Avery
Dennison located in France from 1996 to 1999, and served as a managing
director of Plasteurop located in Belgium from 1989 to 1996. Mr.
Vuillerme's present term of office expires at the 2002 Annual Meeting.
LLEWELLYN SCOTT FLAIG, age 55, has been a Director of the Company 1,275 *
since February 2000. Mr. Flaig served as Senior Vice President of
World Wide Operations of Dell Computer from 1992 to 1995, when he
retired. He left retirement to work for Iomega Corporation from
December 1997 to July 1999 on transforming and improving the company's
operations. Mr. Flaig is currently an Adjunct Professor at the
Kellogg Business School of Northwestern University. Mr. Flaig's
present term of office expires at the 2002 Annual Meeting.
NON-DIRECTOR NAMED EXECUTIVE OFFICERS
G. BRUCE BRYAN, JR., age 44, has been Vice President since 1996. Mr. 6,475(4) *
Bryan joined the Company in 1993 as Manager of the North American
Powder Systems Group for the General Industrial Market.
TODD A. VAUGHAN, age 41, has been an officer of the Company since 5,250(5) *
April 1997. Mr. Vaughan has been employed by the Company since 1992
and is presently Vice President of the Company and General Manager of
Sames North America, Inc.
RONALD A. KOLTZ, age 50, has been Vice President - Controller 1,501(6) *
Corporate Accounting since January 1999. Mr. Koltz was employed by
the Company from October 1972 until September 1998. He served as
Controller of the Company from September 1994 until September 1998.
He briefly held the same position at ITW Binks, which purchased
certain assets from the Company, from October 1998 until January 1,
1999, when he rejoined the Company.
DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP (7 PERSONS) 154,751 5.15%
</TABLE>
- ---------------------------
* Less than 1.0% of the Company's outstanding capital stock.
- 5 -
<PAGE>
(1) The information contained in this column is based upon information
furnished to the Company by the individuals referred to above. The nature
of beneficial ownership for shares shown in this column is sole voting
and investment power.
(2) Includes 9,250 shares issuable upon the exercise of outstanding stock
options exercisable on the Record Date or within 60 days thereafter.
(3) Includes 100,000 shares issuable upon the exercise of outstanding stock
options exercisable on the Record Date or within 60 days thereafter.
(4) Includes 4,875 shares issuable upon the exercise of outstanding stock
options exercisable on the Record Date or within 60 days thereafter.
(5) Includes 4,750 shares issuable upon the exercise of outstanding stock
options exercisable on the Record Date or within 60 days thereafter.
(6) Includes 1,000 shares issuable upon the exercise of outstanding stock
options exercisable on the Record Date or within 60 days thereafter.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE
NOMINEE FOR DIRECTOR NAMED ABOVE.
DIRECTORS' FEES
Each outside director who is not also an employee of the Company
receives a director's fee of $21,000 per annum and $1,000 for each Board
meeting attended in person, or $500 for each Board meeting attended via
telephone, plus reimbursement of expenses relating to attendance at meetings.
Non-employee directors are also entitled to participate in the Company's
Amended and Restated 1996 Stock Option Plan. The Chairman of the Board
receives a director's fee of $60,000 per annum and $1,000 for each equivalent
day above three days in a month, plus reimbursement of expenses. Directors
who perform services for the Company are compensated at a per diem rate of
$1,000.
INFORMATION REGARDING BOARD OF DIRECTORS' MEETINGS AND COMMITTEES
The Board of Directors of the Company held eight meetings and took
action by written consent on seven occasions during fiscal 1999. The Board of
Directors currently has two standing committees: the Audit Committee and the
Compensation Committee. The Company has not designated a nominating
committee. The entire Board of Directors acts to nominate persons for
election as directors. All directors attended at least 75% of the meetings of
the Board of Directors, and of committees on which they served, during 1999.
The Audit Committee is responsible for recommending to the Board of
Directors the engagement of independent auditors for the Company and
reviewing with the independent auditors the plan for and results of the
auditing engagement. The Audit Committee met four times during fiscal 1999.
The Audit Committee of the Board currently consists of Dr. Edwards, Mr.
Vaughan and Mr. Flaig.
The Compensation Committee is responsible for reviewing the
compensation arrangements in effect for the Company's executive officers and
for administering all the Company's employee benefit plans, including the
Company's Amended and Restated 1996 Stock Option Plan. The Compensation
Committee took action by written consent on eight occasions during the last
fiscal year. The Compensation Committee currently consists of Dr. Edwards,
Mr. Vaughan and Mr. Flaig.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Pursuant to Section 16 of the Exchange Act, the Company's officers,
directors and holders of more than 10% of the Company's capital stock are
required to file reports of their trading in equity securities of the Company
with the Securities and Exchange Commission ("SEC"), the Company, the
American Stock Exchange and the Chicago Stock Exchange. Based solely on its
review of copies of such reports received by it, the Company believes that
for fiscal 1999 all filing requirements applicable to its officers,
directors, and more than 10% stockholders were complied with, except that Mr.
Vuillerme failed to timely file a Form 3 upon his election to the Board of
Directors in October 1999. Such report is currently on file with the SEC.
- 6 -
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth separately, for the fiscal years
indicated, each component of compensation paid or awarded to, or earned by, (i)
the Chief Executive Officer ("CEO") of the Company serving at the end of the
last fiscal year, and (ii) each of the most highly compensated executive
officers who either served or who were serving as executive officers during or
at the end of the Company's last fiscal year, respectively, who earned more
than $100,000 in salary and other compensation, other than the CEO,
(collectively referred to herein as the "Named Executive Officers").
SUMMARY COMPENSATION TABLE(1)
<TABLE>
<CAPTION>
ANNUAL LONG-TERM
NAME AND COMPENSATION COMPENSATION
----------------------- ---------------- ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTION AWARDS (#) COMPENSATION($)
------------------ ---- --------- -------- ----------------- ---------------
<S> <C> <C> <C> <C> <C>
Arnold H. Dratt 1999 $366,667 $150,000 -- --
President, Chief Executive 1998(2) 300,000(3) -- 100,000 --
Officer and Director 1997 -- -- -- --
G. Bruce Bryan, Jr. 1999 123,885 55,000(4) -- --
Vice President 1998 106,616 55,000(4) 3,000 --
1997 105,858 16,726 -- --
Todd A. Vaughan 1999 149,615 66,362(4) -- --
Vice President, Sames 1998 132,724 66,362(4) 4,000 --
Corporation and General 1997 131,000 18,155 -- --
Manager, Sames North
America, Inc.
Ronald A. Koltz 1999 88,362 23,500(4) 1,000 11,159(5)
Vice President-Controller 1998 85,895 -- -- 10,236(5)
Corporate Accounting 1997 91,833 -- -- 9,531(5)
Kevin C. Higgins (6) 1999 95,706(7) 10,000(7) -- --
Vice President- Controller 1998 65,360 25,000 1,000 --
International Operations 1997 52,500 -- 300 --
</TABLE>
(1) Compensation paid to executive officers for the fiscal year ended
November 30, 1999, other than salary, bonus, and other compensation
reflected in the table, does not exceed the minimum amounts required to
be reported under the SEC's rules.
(2) Mr. Dratt joined the Company on October 1, 1998. His salary is paid
pursuant to the terms of an Amended and Restated Consulting Agreement
dated as of March 1, 2000, by and between the Company and The
Dratt-Campbell Company, a consulting firm of which Mr. Dratt is President
and co-founder. Please see "Certain Relationships and Related
Transactions" for a discussion of this agreement.
(3) Mr. Dratt's salary is shown on an annualized basis.
(4) These amounts reflect payments made under Bonus Agreements between the
Company and certain executive officers providing for bonus payments
payable at certain dates if the individual remains continuously employed
with the Company through such dates.
(5) Represents amounts expended with respect to post-retirement payments
under employment contracts between the Company and Mr. Koltz.
(6) Mr. Higgins is no longer employed by the Company.
(7) Represents amounts paid to Mr. Higgins from December 1, 1998 through
October 13, 1999.
-7-
<PAGE>
The tables below set forth certain information with respect to options
held by the Company's Named Executive Officers.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED RATES
OF STOCK PRICE
NUMBER OF PERCENT OF TOTAL APPRECIATION
SECURITIES OPTIONS GRANTED EXERCISE OR FOR OPTION TERM ($)
UNDERLYING TO EMPLOYEES IN BASE EXPIRATION -------------------
NAME OPTIONS FISCAL YEAR(%) PRICE ($/SH.) DATE 5% 10%
---- ------- -------------- ------------- ---------- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Arnold H. Dratt -- -- -- -- -- --
G. Bruce Bryan, Jr. -- -- -- -- -- --
Todd A. Vaughan -- -- -- -- -- --
Ronald A. Koltz 1,000 3.08% 16.00 01/11/09 10,062 25,500
Kevin C. Higgins 1,000 3.08% 14.875 12/17/08 9,358 23,715
</TABLE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUE
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS/SARS(#) OPTIONS/SARS($)
ACQUIRED ON VALUE ---------------------------- --------------------------
NAME EXERCISE (#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------ ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Arnold H. Dratt -- -- 100,000 -- -- --
G. Bruce Bryan, Jr. -- -- 4,875 625 8,625 --
Todd A. Vaughan -- -- 4,750 250 11,500 --
Ronald A. Koltz -- -- 1,000 -- -- --
Kevin C. Higgins 1,000 14,875 -- -- -- --
</TABLE>
REPORT OF THE BOARD OF DIRECTORS
REGARDING EXECUTIVE COMPENSATION
OVERVIEW AND PHILOSOPHY
The fundamental philosophy of the Company's compensation program is to
offer competitive compensation opportunities for all employees, including
senior management, which are based on the individual's contribution and
personal performance. The objectives of the Company's compensation program are
to align compensation with business goals and performance and to enable the
Company to attract and retain superior talent and reward performance.
-8-
<PAGE>
The Company also believes it is important to align executive officers'
interests with the success of the Company by placing a portion of pay at risk,
thus making payment dependent upon corporate performance. The compensation of
the Company's CEO and Named Executive Officers is reviewed and approved
annually by the Board of Directors, and is linked to the Company's financial
performance. Fifteen percent or more of executive management's compensation may
consist of a bonus which is influenced by the Company's annual performance.
In determining compensation levels, salary and bonus components are
initially reviewed by the Compensation Committee of the Board of Directors. The
Compensation Committee then makes its recommendations to the full Board of
Directors. The Board studies the recommendations, along with other information
on individual and corporate performance, and votes on compensation levels for
the next fiscal year. Only those members of the Board of Directors who are not
officers of the Company vote on matters relating to the compensation of the CEO
and Named Executive Officers.
EXECUTIVE OFFICER COMPENSATION PROGRAM
The Company's compensation program consists of cash salary, annual
bonus payments based upon performance and stock option grants. There are
currently three main components to the Company's executive compensation
program, as determined by corporate and individual performance:
- Base salary compensation
- Annual incentive compensation
- Stock option grants
In determining salaries, the Compensation Committee takes
into account individual experience, individual performance, total contribution
to the Company's long term success, and the results of the Company's
performance.
Stock option grants to executive officers are intended to
promote the success of the Company by aligning financial interests of executive
officers with stockholders and to provide each executive officer with a
significant incentive to manage the Company from the perspective of an owner
with an equity stake in the business. Stock option grants are based on various
subjective factors, primarily relating to the responsibilities of the
individual officers, and also to their expected future performance.
CHIEF EXECUTIVE OFFICER COMPENSATION
The salary of Mr. Arnold H. Dratt, the Company's CEO for
fiscal 1999, was set at $25,000 per month for fiscal 1999. His salary was based
on a determination to align the CEO's interests with those of the Company's
stockholders and was negotiated in connection with the Consulting Agreement
entered into between the Company and The Dratt-Campbell Company. On March 29,
1999, the Board of Directors unanimously approved a $150,000 bonus and a salary
increase of $8,333 per month to Mr. Dratt. Accordingly, Mr. Dratt's current
compensation is $33,333 per month. The bonus was paid on April 1, 1999, subject
to it being earned on and forfeited prior to September 30, 1999. The Consulting
Agreement was also further amended. The Board deemed the bonus and salary
increase deserving due to the increased amount of time devoted by Mr. Dratt to
the lingering problems remaining from the Company's discontinued operations and
the potential sale of the business. Please see "Certain Relationships and
Related Transactions" for a description of the Consulting Agreement.
COMPENSATION COMMITTEE
Wayne F. Edwards
Clifford J. Vaughan
Llewellyn Scott Flaig
-9-
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1999, decisions regarding executive
compensation were reviewed by the entire Board of Directors based upon the
recommendations of the Compensation Committee. Although Mr. Dratt was present
during compensation discussions by the Board while serving as an executive
officer, he did not vote on decisions regarding his compensation.
AGREEMENTS WITH ARNOLD H. DRATT
Please see "Certain Relationships and Related Transactions"
for a discussion of certain agreements entered into with Mr. Dratt.
-10-
<PAGE>
STOCK PERFORMANCE GRAPH
The graph below compares the cumulative total stockholder
return on the capital stock of the Company for the last five fiscal years with
the cumulative total return on the S&P 500 Index and the S&P Machinery
(Diversified) Index over the same period (assuming the investment of $100 in the
Company's capital stock, the S&P 500 Index and the S&P Machinery (Diversified)
Index on November 30, 1994, and reinvestment of all dividends).
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
AMONG SAMES CORPORATION,
S&P 500 INDEX AND S&P GROUP INDEX
<TABLE>
<CAPTION>
11/30/94 11/30/95 11/29/96 11/28/97 11/30/98 11/30/99
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Sames Corporation $100.00 $129.13 $150.12 $230.96 $ 80.99 $ 80.99
S&P Machinery (Diversified)(1) 100.00 125.90 161.34 203.05 177.14 193.89
S&P 500(1) 100.00 136.98 175.15 225.09 278.35 336.52
</TABLE>
- ------------------
(1) The S&P 500 Index and the S&P Machinery (Diversified) Index were obtained
from Media General Financial Services, Inc.
-11-
<PAGE>
AMENDED AND RESTATED 1996 STOCK OPTION PLAN
The Company's Amended and Restated 1996 Stock Option Plan (the "1996 Stock
Option Plan") authorizes the granting of options to purchase up to 300,000
shares of the capital stock of the Company to present and future executives, key
personnel, consultants and non-employee directors of the Company. Currently, the
Compensation Committee administers the 1996 Stock Option Plan. Pursuant to the
1996 Stock Option Plan, the Compensation Committee may award incentive stock
options ("ISOs") and nonqualified stock options ("NSOs"). ISOs may only be
granted to employees of the Company or its subsidiaries. NSOs may be granted to
all employees of and consultants who provide services to the Company or its
subsidiaries, including non-employee directors. However, no single person may
receive options covering more than 50,000 shares of the capital stock of the
Company in any single year. The exercise price of each option pursuant to the
1996 Stock Option Plan may not be less than the fair market value of the capital
stock on the date of grant. "Fair market value" on any given date is the closing
sales price for shares of capital stock of the Company traded on the American
Stock Exchange on such date. Absent a contrary provision in an award agreement,
each option may be exercised up to 25% in the first year following the grant
thereof, up to 50% in the second year, up to 75% in the third year, and after
the third year up to 100%. Unless otherwise specified in an award agreement,
options must be exercised within 10 years of the date of grant unless the period
is reduced due to death or termination of the optionee's employment.
401(k) PLAN
The Company maintains a 401(k) Plan, which is designed to be qualified
under Section 401(k) of the Internal Revenue Code of 1986, as amended (the
"Code"). An employee is eligible to participate in the 401(k) Plan following
attainment of the age of 21 and the completion of one year of service with the
Company (1,000 hours within a twelve-month period). Under the 401(k) Plan, as
amended in 1997, subject to the limitations imposed under Section 401(k) and
Section 415 of the Code, a participant is able to elect to defer not more than
18% of his or her compensation by directing the Company to contribute such
amount to the 401(k) Plan on such employee's behalf. The Company may elect to
make matching contributions equal to a portion of the participating employee's
contribution, subject to a maximum matching contribution of no more than 6% of
the participant's salary.
Under the 401(k) Plan, a separate account is established for each employee.
Participants are 100% vested in the contributions and in the earnings thereon
and in the employer's contributions. Distributions from the 401(k) Plan are made
upon termination of service, disability or death in a lump sum or in annual
installments.
PROFIT SHARING PLAN
Prior to December 1, 1997, employees of the Company who were over age 21
and who completed one year of service with the Company were eligible to
participate in the John Francis Roche, Jr. Savings and Profit Sharing Fund (the
"Profit Sharing Plan"), a defined contribution retirement savings program.
Participants in the Profit Sharing Plan were required to contribute at least
2 1/2% but no more than 5% of their compensation, up to a limit of $200 per
year. The Company contributed to the Profit Sharing Plan each year the lesser
of (i) 15% of total compensation (as defined in the Profit Sharing Plan), (ii)
18% of the Company's adjusted net income or (iii) six times the total
participant contributions. The Profit Sharing Plan was terminated by the Board
of Directors on November 30, 1998 and the total value of all savings and vested
Company contributions were paid out in full in April 1999. GreatBanc Trust
Company was the trustee of the Profit Sharing Plan and administered the payment
to the participants. There were 300 participants in the Profit Sharing Plan,
including executive officers.
-12-
<PAGE>
EXECUTIVE RETIREMENT INCOME CONTRACTS
The Company has entered into individual Executive Retirement Income
Contracts with certain executives in each case providing for payment of annual
retirement benefits to the executive (or his beneficiary in the event of his
death) based on a percentage of the executive's average annual salary (exclusive
of bonuses, profit sharing and other employee benefits) for the five years
preceding retirement, multiplied by the number of full fiscal years of service
in the employ of the Company. Retirement payments terminate a specified number
of years after retirement or in the event the executive engages in specified
competitive activities following retirement. In addition, no retirement benefits
are payable if the executive voluntarily resigns prior to age 65 without the
consent of the Company, or if he is dismissed by the Company for specified
cause.
The following table shows the amount of annual retirement benefits payable
under these arrangements at various levels of final five year average salary and
for different years of service.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
-------------------------------------------------------------------
REMUNERATION 5 15 25 35 45 50
------------ ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
$100,000 $7,500 $22,500 $37,500 $52,500 $67,500 $75,000
125,000 9,375 28,125 46,875 65,625 84,375 93,750
150,000 11,250 33,750 56,250 78,750 101,250 112,500
175,000 13,125 39,975 65,625 91,875 118,125 131,250
200,000 15,000 45,000 75,000 105,000 135,000 150,000
225,000 16,875 50,625 84,375 118,125 151,875 168,750
250,000 18,750 56,250 93,750 131,250 168,750 187,500
275,000 20,625 61,875 103,125 144,375 185,625 206,250
</TABLE>
As of November 30, 1999, the number of full fiscal years of service
with the Company for officers named in the Cash Compensation Table who are
parties to the above-described arrangements and the amount of salary paid to
such officers during the fiscal year ended November 30, 1999 are as follows: Mr.
Ronald A. Koltz - 27 years, $88,362. Benefit amounts shown in this table are
computed on a straight line annuity basis and are not subject to any deduction
for Social Security benefits or other offsets.
CHANGE IN CONTROL ARRANGEMENTS
The Company has entered into individual Employment Security Agreements
with Mr. Koltz providing for severance payments by the Company in the event that
within three years after a "change in control" (as defined therein) either the
Company terminates the individual's employment for other than "good cause" (as
defined therein), disability, death, or normal retirement, or the individual
terminates his employment for "good reason" (as defined therein). Subject to
certain limitations, the amount of the severance payment equals two times the
sum of (i) such employee's annual salary at the rate in effect at the time of
termination, plus (ii) the maximum bonus such employee could earn for the fiscal
year in which the termination occurs. A "change in control" will in general be
deemed to occur where a third person becomes the owner of 20% or more of the
capital stock of the Company or where a corporate transaction occurs, the effect
of which is that persons who were directors of the Company before the
transaction cease to constitute a majority of the Board of Directors.
The Company has also entered into Bonus Agreements with certain
executive officers and other key employees which provide for bonus payments
(generally equal to six months' salary) payable at certain dates if the
individual remains continuously employed by the Company through such dates (the
"Stay Periods"). The agreements also provide for bonus payments (equal to six to
twelve months' salary) payable if a change of control of the Company occurs
during a Stay Period. A "change in control" will be deemed to occur when (a) the
current stockholders of the Company cease to be beneficial owners, directly or
indirectly, of a majority of stock of the Company, or any successor company, or
(b) all or substantially all of the Company's assets are sold or otherwise
disposed of. The agreements are intended to
-13-
<PAGE>
provide an incentive for the executive officers and key employees to remain
in the employment of the Company until a purchaser for the Company can be
found. Each of these agreements expires on May 1, 2000.
The Company also entered into a Consulting Agreement with The
Dratt-Campbell Company providing for certain payments to Arnold H. Dratt in the
event of a change in control of the Company. Such agreement is discussed below.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
AGREEMENTS WITH ARNOLD H. DRATT
The Company is a party to an Amended and Restated Consulting Agreement
(the "Consulting Agreement") dated as of March 1, 2000, with The Dratt-Campbell
Company, a consulting company of which Mr. Arnold H. Dratt, the Company's
President and Chief Executive Officer, is the President and co-founder
("Dratt-Campbell"). Under the terms of the Consulting Agreement, Dratt-Campbell
shall make Mr. Dratt available for service as the Company's President and Chief
Executive Officer, and the Company shall pay to Mr. Dratt consulting fees of
$25,000 per month plus certain related expenses including monthly medical
premiums and automobile allowances. Mr. Dratt is also entitled to participate in
the Company's annual bonus plan, and to receive such bonus or bonuses as the
Board of Directors may from time to time in its sole discretion determine. Also,
beginning in 2001 and continuing each year during the term of the Consulting
Agreement, Mr. Dratt shall be granted 10,000 options to purchase shares of the
Company's capital stock on the date of the Company's annual meeting of
stockholders, with the price of each option equal to the closing price of the
capital stock on the date of the grant.
The Consulting Agreement also provides that in the event of a "change
in control" (as defined therein) the Company will pay Mr. Dratt a lump sum
amount equal to twelve (12) times the sum of (a) his monthly consulting fee and
(b) his related expenses. In the event that a change in control occurs within
the six month period following the termination of the Consulting Agreement (i)
by the Company other than for "cause" (as defined therein), or (ii) by Mr. Dratt
for "good reason" (as defined therein), the Company shall pay Mr. Dratt a lump
sum amount equal to six (6) times the sum of (a) his monthly consulting fee and
(b) his related expenses. A "change in control" is defined in the Consulting
Agreement as (a) the merger, consolidation or reorganization of the Company with
or into another corporation or legal person, the result of such merger,
consolidation or reorganization being that less than 50% of the outstanding
voting securities of the surviving, resulting or acquiring entity are owned in
the aggregate by stockholders of the Company; (b) the sale, transfer or
conveyance by the Company of all or substantially all of its business or assets
to another legal person, less than 50% of the outstanding voting securities of
which are owned by stockholders of the Company; (c) the filing with the
Securities and Exchange Commission of a Schedule 13D, Schedule 14D-1, or other
public announcement disclosing that any person or group has become the
beneficial owner of more than 50% of the outstanding voting shares of the
Company; (d) the failure of the members of the "incumbent board" (as defined
therein) to constitute a majority of the Board of Directors; or (e) the
dissolution or liquidation of the Company by its stockholders. The Consulting
Agreement shall terminate on March 1, 2002, unless earlier terminated or
extended by written agreement of the Company and Dratt-Campbell.
The Company was also a party to an earlier consulting agreement with
Dratt-Campbell, pursuant to which Mr. Dratt provided consulting services to the
Company from October 1998 until March 1, 2000. During fiscal 1999, the Company
paid consulting fees of $65,400 to Dratt-Campbell pursuant to the terms of this
agreement.
-14-
<PAGE>
PROPOSAL 2: APPROVAL OF THE SAMES EMPLOYEE STOCK PURCHASE PLAN
Subject to approval by the stockholders, the Board of Directors has
adopted the Sames Employee Stock Purchase Plan (the "Plan"), effective January
1, 2000, pursuant to which employees of the Company have the opportunity to
acquire shares of the capital stock of the Company at a 15% discount. Approval
of Proposal 2 requires the affirmative vote of a majority of the shares of
capital stock of the Company present in person or represented by proxy and
entitled to vote at the Annual Meeting. Abstentions will be counted as present
and entitled to vote and have the effect of voting against Proposal 2. Broker
non-votes will not be counted as present and entitled to vote and have no effect
on the vote on Proposal 2.
The full text of the Plan is set forth as Appendix A to this Proxy
Statement. Stockholders are encouraged to read the Plan in its entirety. The
following is a summary.
PURPOSE
The purpose of the Plan is to advance the interests of the Company and
its stockholders by providing employees of the Company and certain designated
subsidiaries with an opportunity to acquire an ownership interest in the Company
through the purchase of shares of the Company's capital stock on favorable terms
through payroll deductions. With respect to employees who reside in the United
States, the Plan is intended to qualify as an employee stock purchase plan under
Section 423 of the Code.
ADMINISTRATION
The Plan will be administered by the Employee Stock Purchase Plan
Committee (the "Committee"). Members of the Committee may be officers or
directors of the Company, are appointed from time to time by the Board, serve at
the pleasure of the Board, and may resign at any time upon written notice to the
Board. Consistent with the terms of the Plan, the Committee will adopt and apply
such rules and regulations concerning the operation and administration of the
Plan as it deems necessary or proper, interpret and decide all questions
concerning the Plan, and will have the power to take any and all actions that
the Committee deems necessary or appropriate to administer the Plan.
STOCK SUBJECT TO THE PLAN
There are reserved for issuance under the Plan a maximum of 100,000
shares of the capital stock of the Company, subject to adjustments as provided
in the Plan. Authorized but unissued shares and treasury shares may be made
available for issuance under the Plan. Any increase in the amount of shares
reserved for issuance will require further stockholder approval.
ELIGIBILITY
All domestic employees of the Company are eligible to participate in
the Plan 30 days after their first day of employment, except that employees
whose customary employment is for not more than 20 hours per week in any
calendar year are not eligible to participate. In addition, no employee owning
shares of capital stock and/or holding outstanding options to purchase shares of
capital stock possessing 5% or more of the total combined voting power or value
of all classes of shares of the Company or of any subsidiary shall be eligible
to participate in the Plan.
OPERATION OF THE PLAN
Eligible employees participating in the Plan may elect to contribute on
an after-tax basis from 1% to 10% of their base pay to purchase capital stock of
the Company. Each employee will be entitled to purchase up to the number of
whole shares as their accumulated payroll deductions permit during any offering
period, which is a calendar year quarter. However, during any calendar year an
employee may not purchase capital stock through the Plan with a fair market
value (determined as of the first day of an offering period) in excess of
$25,000. The maximum number of shares of capital stock an employee will be able
to purchase during any particular offering period will be limited to 500 shares
of capital stock. A participating employee may not increase or decrease the
amount of his or her payroll deductions
-15-
<PAGE>
during any offering period but may increase or decrease such amount for any
subsequent offering period if done at least 15 days before the beginning of
such offering period. Payroll deductions will be held by the Company as part
of its general assets in an account established under the Plan for each
participating employee. Upon termination of employment, any payroll
deductions accumulated in an employee's account will be applied in accordance
with the provisions of the Plan. No interest will be paid on an employee's
payroll deductions.
For each offering period, each participating employee will be granted
an option to purchase the number of whole shares of the Company's capital stock
that he or she will be able purchase with the payroll deductions accumulated
during that period, plus carryovers (from a prior period), up to a maximum of
500 shares in any one offering period. Unless a participating employee withdraws
from the Plan, such option will be exercised automatically on the last business
day of the offering period for the purchase of such shares at the applicable
price, which will be the lesser of 85% of the fair market value per share of the
capital stock on the first business day of the offering period or 85% of the
fair market value per share of the capital stock on the last business day of the
offering period.
LIMITED TRANSFERABILITY OF OPTIONS AND SHARES
Neither payroll deductions credited to an employee's account nor any
rights relating to the exercise of an option or the receipt of shares of capital
stock under the Plan may be assigned, transferred, pledged or otherwise disposed
of in any way except by will or the laws of descent and distribution, or in the
event of a participating employee's death, as described in the Plan.
FEDERAL INCOME TAX CONSEQUENCES
The Plan is intended to qualify as an "employee stock purchase plan"
under Section 423 of the Code. The amount withheld from an employee's
compensation under the Plan will constitute ordinary income for federal income
tax purposes in the year in which such amounts would otherwise have been paid to
the employee. However, an employee will generally not recognize any income for
federal income tax purposes either on the grant of an option or upon the
issuance of any shares of capital stock under the Plan.
The federal income tax consequences incurred upon disposition of shares
of capital stock acquired under the Plan depend upon how long an employee holds
the shares. If an employee disposes of shares acquired under the Plan (other
than a transfer by reason of death) within a period of two years from the first
day of a corresponding offering period, an amount equal to the fair market value
of each share on the last business day corresponding to such offering period
minus the purchase price will be treated as ordinary income for federal income
tax purposes in the taxable year in which the disposition takes place. Such
amount may be subject to wage withholding. The amount realized upon such
disposition of a share minus the purchase price (adjusted to reflect any
ordinary income incurred, as described in the preceding sentence) will
constitute long-term capital gain or loss if the disposition occurs more than
one year after the last day of the offering period and short-term capital gain
or loss if the disposition occurs one year or less after the last day of the
offering period.
If an employee disposes of any shares acquired under the Plan more than
two years after the first day of an offering period in which such shares were
acquired or, if no disposition has yet occurred upon the employee's death, an
amount equal to the lesser of (a) the fair market value of the shares at the
time of disposition (or death) minus the option price, or (b) the fair market
value of the shares on the first day of the corresponding offering period minus
the option price will be recognized as ordinary income and may be subject to
wage withholding. The amount realized upon such disposition of a share minus the
option price (adjusted to reflect any ordinary income incurred, as described in
the preceding sentence) will constitute long-term capital gain or loss. With
respect to a transfer of such shares upon death, any remaining gain or loss will
not be recognized. However, a subsequent sale or exchange of such shares by an
employee's estate or the person receiving such shares by reason of the
employee's death may result in capital gain or loss.
No income tax deduction ordinarily is allowed to the Company with
respect to the grant of any option under the Plan, the issuance of any shares of
capital stock under the Plan or the disposition of any shares acquired under the
Plan and held for two years. However, if an employee disposes of shares
purchased under the Plan within two years
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<PAGE>
after the first day of an offering period in which the shares were acquired,
the Company may claim an income tax deduction in the year of such disposition
in an amount equal to the amount constituting ordinary income to the
employee, provided that the Company complies with the applicable wage
withholding requirements.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR"
APPROVAL OF THE PLAN.
PROPOSAL 3: APPROVAL OF AMENDMENT TO THE AMENDED AND RESTATED 1996 STOCK
OPTION PLAN OF THE COMPANY
The Board of Directors has adopted, and is recommending to the
stockholders for their approval at the Annual Meeting, an amendment to the
Company's Amended and Restated 1996 Stock Option Plan to provide for an
annual automatic grant to non-employee directors of the Company of an option
to purchase 2,000 shares of the Company's capital stock, or 3,000 shares if
such non-employee director is also serving as the Chairman of the Board of
Directors of the Company. The 1996 Stock Option Plan currently provides for
an annual automatic grant to such directors of an option to purchase 1,000
shares, or 2,000 in the case of a non-employee director serving as the
Chairman of the Board. Each option will continue to be granted on the date of
each Annual Meeting of Stockholders as long as such non-employee director
continues to serve as a director of the Company after such annual meeting.
Approval of Proposal 3 requires the affirmative vote of a majority
of the shares of capital stock of the Company present in person or
represented by proxy and entitled to vote at the Annual Meeting. Abstentions
will be counted as present and entitled to vote and have the effect of voting
against Proposal 3. Broker non-votes will not be counted as present and
entitled to vote and have no effect on the vote on Proposal 3.
The full text of the 1996 Stock Option Plan is set forth as Appendix
B to this Proxy Statement. Stockholders are encouraged to read the 1996 Stock
Option Plan in its entirely. The following is a summary of the Plan, as
amended, assuming stockholder approval.
PURPOSE
The purpose of the 1996 Stock Option Plan is to allow the Company to
offer present and future executives, key personnel, consultants and
non-employee directors stock-based incentives in the Company, thereby giving
them a stake in the Company's growth and prosperity and encouraging them to
continue their services with the Company, its subsidiaries or affiliated
companies.
RESERVATION OF SHARES
The 1996 Stock Option Plan permits the grant of options to purchase
up to 300,000 shares of capital stock of the Company. Authorized but unissued
shares and treasury shares may be made available for issuance under the 1996
Stock Option Plan. In the event of corporate changes affecting the
capitalization of the Company, such as stock splits, or a corporate
transaction, such as any merger, consolidations, separations, including a
spin-off, or other distributions of stock or property of the Company, any
reorganization or any partial or complete liquidation of the Company,
appropriate adjustments will be made in the number and class of shares for
which options may thereafter be granted under the 1996 Stock Option Plan and
the option price and the number and class of shares subject to outstanding
options granted pursuant to the 1996 Stock Option Plan.
ADMINISTRATION
The 1996 Stock Option Plan may be administered, construed and
interpreted by either the Board of Directors of the Company, the Compensation
Committee of the Board of Directors of the Company or such other committee to
whom the Board may delegate this function. The 1996 Stock Option Plan is
presently administered by the Compensation Committee. Consistent with the
terms of the 1996 Stock Option Plan, the Compensation Committee will select
the individuals who shall participate in the 1996 Stock Option Plan,
determine the sizes, types, terms and
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<PAGE>
conditions of options granted and establish, amend or waive the rules and
regulations for the 1996 Stock Option Plan's administration.
ELIGIBILITY
Incentive stock options may be granted only to employees, including
employees who are directors and employees who reside outside the United
States, of the Company or its subsidiaries. Nonqualified stock options may be
granted to all employees of and consultants who provide services to the
Company or its subsidiaries, including non-employee directors. Options may be
granted to employees or consultants at any time and from time to time in the
Committee's sole discretion. However, no employee or consultant may receive
options covering more than 50,000 shares of the capital stock of the Company
in any single fiscal year.
OPTION PRICE AND PAYMENT OF THE OPTION PRICE
The price to be paid for shares upon the exercise of each option
pursuant to the 1996 Stock Option Plan may not be less than the fair market
value of such shares on the date on which the option is granted, as
determined by the Board or a committee. The exercise price of any incentive
stock option granted to an employee owning more than 10% of the total
combined voting power of all classes of stock of the Company or any of its
subsidiaries must not be less than 110% of the fair market value of the
option shares on the date of grant. The fair market value of the option
shares on a given date shall be the closing sales price for shares of stock
of the Company traded on the American Stock Exchange on such date as reported
by THE WALL STREET JOURNAL, Midwest Edition.
Upon exercise, the option price shall be paid either in cash or, if
lawful and permitted by the Committee, (a) by the exchange of a number of
previously acquired shares of the Company with a fair market value at the
time of exercise equal to the total exercise purchase price; or (b) by any
other means which the Committee, in its sole discretion, determines to be
legal consideration for the shares and to be consistent with the 1996 Stock
Option Plan's purposes.
The 1996 Stock Option Plan also permits optionees who exercise
options to elect to have the Company withhold a portion of the option shares
purchased in order to satisfy any federal, state or local tax liability
imposed on the optionee by virtue of the exercise of the option.
PERIOD OF OPTION
Each option granted shall be effective until the termination date
set forth in the written award agreement. If no date is set forth in the
award agreement, each option granted under the 1996 Stock Option Plan shall
be effective for a period of 10 years from the date of grant thereof, unless
the period is reduced because of death or termination of the optionee's
employment, except that any incentive stock option granted to a person owning
more than 10% of the outstanding shares of the capital stock of the Company
may not be exercised after the expiration of five years from the date of the
grant.
EXERCISE OF OPTION
Options granted under the 1996 Stock Option Plan shall be
exercisable as prescribed in the award agreement. If the award agreement does
not set forth times with respect to the exercisability of the options, then
each option may be exercised up to 25% on the first anniversary of the grant
thereof, up to 50% on the second anniversary, up to 75% on the third
anniversary, and up to 100% on the fourth anniversary of the grant. This
limitation shall not be effective in the event of the death, disability or
retirement of an optionee while in the employ of the Company or its
subsidiaries. Upon termination of employment for a reason other than death,
disability, retirement, early retirement or for cause, the optionee may
exercise any nonqualified stock option or any incentive stock option within
one month of the date of termination, to the extent such optionee was
otherwise entitled to exercise such options. Upon a change of control of the
Company, as defined in the 1996 Stock Option Plan, all options granted under
the 1996 Stock Option Plan become immediately exercisable in full. After an
option is granted, the committee administering the 1996 Stock Option Plan, in
its sole discretion, may accelerate the exercisability of such option.
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<PAGE>
The 1996 Stock Option Plan provides that the aggregate fair market
value (determined as of the time the option is granted) of the common shares
for which incentive stock options may be exercised for the first time by any
optionee during any calendar year may not exceed $100,000.
LIMITED TRANSFERABILITY OF OPTIONS
Options (other than incentive stock options) may not be transferred
except to immediate family members, a trust for the benefit of immediate
family members or a partnership of solely immediate family members so long as
there is no consideration given for the transfer, the award agreement
expressly permits the transfer and subsequent transfers are prohibited.
NON-EMPLOYEE DIRECTORS
Each non-employee director is entitled to a nonqualified stock
option to purchase 3,000 shares on the date such non-employee director first
becomes a director. Thereafter, for so long as the non-employee director
remains such, he or she annually will be granted an option for an additional
2,000 shares, or 3,000 shares if such non-employee director shall also be
serving as Chairman of the Board. Each such option shall be granted on the
date of each Annual Meeting of Stockholders, but only if the non-employee
director will continue to serve as a director after such Annual Meeting. The
Board of Directors may in its discretion increase the number of shares
subject to an initial award or annual award in recognition of significant
additional duties and responsibilities assumed by a non-employee director in
connection with his or her service as Chairman of the Board of Directors or
other positions on the Board of Directors.
All non-employee directors of the Company's subsidiary Sames S.A.
are excluded from participation in the Plan.
AMENDMENT AND TERMINATION OF THE PLAN
The Board of Directors may at any time alter, amend, suspend or
terminate the 1996 Stock Option Plan, subject to any requirement of
stockholder approval, under law, rule or regulation. Unless earlier
terminated by the Board of Directors, the 1996 Stock Option Plan will
terminate on October 24, 2006.
FEDERAL INCOME TAX CONSEQUENCES
The 1996 Stock Option Plan provides for the grant of incentive stock
options and nonstatutory stock options. The federal income tax consequences
to the Company and the optionee arising out of the grant and exercise of
incentive stock options and nonstatutory stock options and upon the
subsequent sale of the shares acquired pursuant thereto are discussed below.
An optionee will generally not be deemed to have recognized taxable
income upon grant or exercise of any incentive stock option, provided that
shares transferred in connection with the exercise are not disposed of by the
optionee until the later of one year after the date the shares are
transferred in connection with the exercise of the incentive stock option or
two years after the date of grant of such option. If the holding periods are
satisfied, upon disposal of the shares, the aggregate difference between the
per share option exercise price and the fair market value of the capital
stock is recognized as income taxable at long-term capital gains rates. No
compensation deduction may be taken by the Company as a result of the grant
or exercise of incentive stock options, assuming these holding periods are
met.
In the case of the exercise of a nonqualified stock option, an
optionee will be deemed to have received ordinary income upon exercise of the
stock option in an amount equal to the aggregate amount by which the per
share exercise price is exceeded by the fair market value of the capital
stock. In the event shares received through the exercise of an incentive
stock option are disposed of prior to the satisfaction of the holding periods
(a "disqualifying disposition"), the exercise of the option will be treated
as the exercise of a nonqualified stock option, except that the optionee will
recognize the ordinary income for the year in which the disqualifying
disposition occurs. The amount of any ordinary
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<PAGE>
income deemed to have been received by an optionee upon the exercise of a
nonqualified stock option or due to a disqualifying disposition will be a
deductible expense of the Company for tax purposes.
PLAN BENEFITS
The following table provides certain information with respect to all
grants which have been made under the 1996 Stock Option Plan to specific
individuals and groups of individuals, specifying the amounts granted to
Named Executive Officers individually, all current directors who are not
executive officers as a group, all director nominees individually, all
current executive officers as a group and all employees, including current
officers who are not executive officers as a group.
All grants of stock options made to the officers, directors and
employees of the Company reflected in the table below have an exercise price
equal to the fair market value of the capital stock of the Company on the
date of grant. All options have a term of 10 years. All options reflected in
the table below will immediately vest upon termination of employment due to
death or disability or "change in control" (as defined in the 1996 Stock
Option Plan) of the Company.
PLAN BENEFITS
<TABLE>
<CAPTION>
TOTAL OPTIONS TO BE
OPTION AWARDS AWARDED AT
------------------------
NAME AND POSITION NUMBER OF SHARES (1) 2000 ANNUAL MEETING
- ----------------- ---------- -------------------
<S> <C> <C>
ARNOLD H. DRATT, President, 110,000 --
CEO and Director
G. BRUCE BRYAN, JR., Vice President 8,500 --
TODD A. VAUGHAN, Vice President-
Sames Corporation; General
Manager- Sames North America, Inc. 9,000 --
RONALD A. KOLTZ, Vice President-
Controller Corporate Accounting 3,000 --
All Current Directors Who are not
Executive Officers as a Group
(4 persons) 32,000 7,000
DR. WAYNE F. EDWARDS,
Director Nominee 12,000 3,000
All Current Executive Officers as a
Group (4 persons) 130,500 --
All Employees, including Current
Officers who are not Executive
Officers, as a Group 121,000 --
</TABLE>
(1) Includes all options awarded to each specified individual or group of
individuals as of March 20, 2000.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" APPROVAL
OF THE AMENDMENT TO THE 1996 STOCK OPTION PLAN.
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<PAGE>
PROPOSAL 4: RATIFICATION OF INDEPENDENT ACCOUNTANTS
The Company is asking the stockholders to ratify the selection of
KPMG LLP ("KPMG") as the Company's independent accountants for the fiscal
year ending December 31, 2000. The affirmative vote of a majority of the
outstanding voting shares of the Company present or represented and entitled
to vote at the Annual Meeting, is required to ratify the selection of KPMG.
Abstentions will have the effect of voting against this Proposal 4. Broker
non-votes will have no effect on the vote.
In the event the stockholders fail to ratify the appointment, the
Board of Directors will reconsider its selection. Even if the selection is
ratified, the Board of Directors, in its discretion, may direct the
appointment of a different independent accounting firm at any time during the
year if the Board of Directors feels that such a change would be in the
Company's and its stockholders' best interests.
Representatives of KPMG will be present at the Annual Meeting, will
have the opportunity to make a statement if they desire to do so, and will be
available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF
THE SELECTION OF KPMG TO SERVE AS THE COMPANY'S INDEPENDENT ACCOUNTANTS
FOR THE FISCAL YEAR ENDING DECEMBER 31, 2000.
OTHER MATTERS
Management does not know of any other matters which are likely to be
brought before the Annual Meeting. If any other matters properly come before
the meeting, it is the intention of the persons named in the enclosed proxy
to vote such proxy in accordance with their judgment on such matters.
STOCKHOLDER PROPOSALS FOR
THE 2001 ANNUAL MEETING
NOMINATIONS FOR THE BOARD OF DIRECTORS
The Company's By-Laws provide that written notice of proposed
stockholder nominations for the election of directors at an Annual Meeting
must be given to the Secretary of the Company no earlier than February 1 and
no later than February 25 immediately preceding the meeting. Notice to the
Company from a stockholder who proposes to nominate a person for election as
a director must contain certain information about that person, including age,
business and residence addresses and such other information as would be
required to be included in a proxy statement soliciting proxies to nominate
that person. If the Chairman of the Annual Meeting determines that a person
was not nominated in accordance with the foregoing procedures, such person
shall not be eligible for election as a director.
STOCKHOLDER PROPOSALS
If any stockholder intends to present a proposal to be considered
for action at the 2001 Annual Meeting of Stockholders and to be included in
the Company's proxy materials, the proposal must be in proper form and
received by the Secretary of the Company on or before November 20, 2000, for
review and consideration for inclusion in the Company's proxy statement and
form of proxy relating to that meeting. Any such proposal will be subject to
17 C.F.R. Section 240.14a-8 ("Rule 14a-8") of the Rules and Regulations
promulgated under the Securities Exchange Act of 1934, as amended.
In addition, the Company's By-Laws require that written notice of
proposals by stockholders to be presented at an Annual Meeting be delivered
to the Secretary of the Company no earlier than February 1 and no later than
February 25 immediately preceding the meeting. Such notice to the Company
must set forth (i) a brief description of the business desired to be brought
before the Annual Meeting and the reasons for conducting such business at the
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Annual Meeting, (ii) the name and record address of the stockholder proposing
such business, (iii) the number of shares beneficially owned by the
stockholder and (iv) any material interest of the stockholder in such
business. Notice to the Company from a stockholder who proposes to nominate a
person for election as a director must contain certain information about that
person, including age, business and residence addresses and such other
information as would be required to be included in a proxy statement
soliciting proxies to nominate that person. These requirements apply to any
matter that a stockholder wishes to raise at an annual meeting, including
those matters raised other than pursuant to the procedures of Rule 14a-8.
Nothing in this paragraph shall be deemed to require the Company to include
in its proxy statement or the proxy relating to any annual meeting any
stockholder proposal which does not meet all of the requirements for
inclusion established by the SEC in effect at the time such proposal is
received.
By order of the Board of Directors,
GUY E. SNYDER, SECRETARY
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APPENDIX A
SAMES EMPLOYEE STOCK PURCHASE PLAN
1. PURPOSE. The purpose of this Sames Employee Stock Purchase Plan (the
"Plan") is to advance the interests of Sames Corporation, a Delaware
corporation ("the Company"), and its shareholders by providing Eligible
Employees (as defined in section 2(g) below) of the Company and its
Designated Subsidiaries (as defined in section 2(f) below) with an
opportunity to acquire an ownership interest in the Company by purchasing
Common Stock (as defined in Section 2(c) below) on favorable terms through
payroll deductions. It is the intention of the Company that the Plan, as
applied to Employees resident in the United States of America, qualify as an
"employee stock purchase plan" under section 423 of the Internal Revenue Code
of 1986, as amended (the "Code"). Accordingly, provisions of the Plan shall
be construed so as to extend and limit participation in a manner consistent
with the requirements of section 423 of the Code. As applied to an Employee
resident in a country other than the United States of America, the Plan shall
not be subject to section 423 of the Code and the terms of the Plan may be
subject to an appendix to the Plan corresponding to the Employee's resident
country.
2. DEFINITIONS.
(a) "Board" means the Board of Directors of the Company.
(b) "Business Day" means a day when the American Stock Exchange is
open.
(c) "Common Stock" means the common stock, par value $1.00 per
share, of the Company, or the number and kind of shares of
stock or other securities into which such common stock may be
changed in accordance with section 13 of the Plan.
(d) "Committee" means the entity administering the Plan, as
provided in section 3 below.
(e) "Compensation" means the total base compensation, including
salary, wages, overtime pay, and commission, paid to an
Eligible Employee by reason of his or her employment with an
Employer as an employee (determined prior to any reduction
thereof by operation of a salary reduction election under a
plan described in section 401(k) of the Code or section 125 of
the Code), as reported on Form W-2, but excluding bonuses,
incentive compensation and any amounts not paid in cash which
are required to be accounted for as imputed income on Form
W-2, any reimbursements of expenses, automobile allowances and
amounts under stock incentives or stock options.
(f) "Designated Subsidiary" means a Subsidiary that has been
designated by the Board from time to time, in its sole
discretion, as eligible to be an Employer in the Plan.
(g) "Eligible Employee" means, with respect to any Offering, an
individual who is an Employee at all times during the period
beginning on the Offering Date and ending on the day three (3)
months before the Termination Date.
(h) "Employee" means any person, including an Insider, who has
attained the age of maturity so that he or she is considered
to be an adult in the jurisdiction where he or she resides and
is employed by an Employer, but, exclusive of any person who
is classified by an Employer as an independent contractor.
(i) "Employer" means, collectively, the Company and any of its
Designated Subsidiaries.
(j) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(k) "Fair Market Value" generally means, with respect to any share
of Common Stock, as of any date under the Plan, the closing
price of the Common Stock on the American Stock Exchange on a
particular date.
(l) "Insider" means any Participant who is subject to section 16
of the Exchange Act.
<PAGE>
(m) "Offering" means any of the offerings to Participants of
options to purchase Common Stock under the Plan, each
continuing until the last Business Day of a calendar year
quarter, as described in section 5 below.
(n) "Offering Date" means the first day of the period of an
Offering under the Plan, as described in section 5 below.
(o) "Option Price" means the lesser of: (i) 85% of the Fair Market
Value of one share of Common Stock on the Offering Date, or
(ii) 85% of the Fair Market Value of one share of Common Stock
on the Termination Date.
(p) "Participant" means an Eligible Employee who elects to
participate in Offerings under the Plan pursuant to section 6
below.
(q) "Securities Act" means the Securities Act of 1933, as amended.
(r) "Subsidiary" means any corporation, other than the Company, in
an unbroken chain of corporations, beginning with the Company
if, at the time an option is granted under the Plan, each of
the corporations, other than the last corporation in the
unbroken chain, owns stock possessing 50 percent or more of
the total combined voting power of all classes of stock in one
of the other corporations in such chain.
(s) "Termination Date" means the last day of the period of an
Offering under the Plan, as described in section 5 below.
3. PLAN ADMINISTRATION.
(a) COMMITTEE MEMBERS. The administration of the Plan shall be
under the supervision of the committee for the Plan (the
"Committee") appointed by the Board from time to time. Members
of the Committee shall serve at the pleasure of the Board and
may be removed by the Board at any time without prior written
notice. A Committee member may resign by giving written notice
to the Board.
(b) POWERS AND DUTIES OF THE COMMITTEE. The Committee will have
full power to administer the Plan in all of its details,
subject to the requirements of applicable law. For this
purpose, the Committee's powers will include, but will not be
limited to, the following authority, in addition to all other
powers provided by this Plan:
(i) To adopt and apply, in a uniform and
nondiscriminatory manner to all persons similarly
situated, such rules and regulations as it deems
necessary or proper for the efficient and proper
administration of the Plan, including the
establishment of any claims procedures that may
include a requirement that all disputes that cannot
be resolved between a Participant and the Committee
will be subject to binding arbitration;
(ii) To interpret the Plan and decide all questions
concerning the Plan, such as the eligibility of any
person to participate in the Plan, and the respective
benefits and rights of Participants and others
entitled thereto and the exclusive power to remedy
ambiguities, inconsistencies or omissions in the
terms of the Plan;
(iii) To appoint such agents, counsel, accountants,
consultants and other persons as may be required to
assist in administering the Plan;
(iv) To allocate and delegate its responsibilities under
the Plan and to designate other persons to carry out
any of its responsibilities under the Plan;
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(v) To prescribe such forms as may be necessary or
appropriate for Employees to make elections under the
Plan or to otherwise administer the Plan; and
(vi) To do such other acts as it deems necessary or
appropriate to administer the Plan in accordance with
its terms, or as may be provided for or required by
law.
(c) COMMITTEE ACTION. The certificate of a Committee member
designated by the Committee that the Committee has taken or
authorized any action shall be conclusive in favor of any
person relying on, or subject to, the certificate. Any
interpretation of the Plan, and any decision on any matter
within the discretion of the Committee, made by the Committee
in good faith shall be final and binding on all persons. A
majority of the members of the Committee shall constitute a
quorum. The Committee shall act by majority approval of the
members and shall keep minutes of its meetings. Action of the
Committee may be taken without a meeting if unanimous written
consent is given. Copies of minutes of the Committee's
meetings and of its actions by written consent shall be kept
with the corporate records of the Company.
(d) EXONERATION OF COMMITTEE MEMBERS. No member of the Committee
shall be liable for any action or determination made in good
faith with respect to the Plan or any option granted under it.
The Company hereby agrees to indemnify, defend and hold
harmless, to the fullest extent permitted by law, any
Committee member against any and all liabilities, damages,
costs and expenses (including attorneys' fees and amounts paid
in settlement of any claims approved by the Company)
occasioned by any act or omission to act in connection with
the Plan, if such act or omission was not due to the gross
negligence or willful misconduct of the Committee member.
4. ELIGIBILITY TO PARTICIPATE IN OFFERINGS.
(a) An Eligible Employee is entitled to participate in Offerings
in accordance with sections 5 and 6, beginning with the first
Offering Date after an Employee has been employed by an
Employer for 30 consecutive days, subject to the limitations
imposed by section 423 of the Code.
(b) Notwithstanding any provisions of the Plan to the contrary:
(i) no Employee shall be granted an option under the Plan if
immediately after the grant, such Employee (or any other
person whose stock ownership would be attributed to such
Employee pursuant to section 424(d) of the Code) would own
shares of Common Stock and/or hold outstanding options to
purchase shares of Common Stock possessing 5% or more of the
total combined voting power or value of all classes of shares
of the Company or of any Subsidiary.
5. OFFERINGS. Options to purchase shares of Common Stock shall be
offered to Participants under the Plan through a continuous series of
Offerings, each beginning on the first Business Day of a calendar year
quarter (the "Offering Date"), and each Offering shall terminate on the last
Business Day of a calendar year quarter corresponding to the Offering Date
(the "Termination Date"). The first Offering under the Plan, however, shall
have an Offering Date of January 3, 2000 and a Termination Date of March 31,
2000. Offerings under the Plan shall continue until either (a) the Committee
decides, in its sole discretion, that no further Offerings shall be made
because the Common Stock remaining available under the Plan is insufficient
to make an Offering to all Eligible Employees, or (b) the Plan is terminated
in accordance with section 17 below. Notwithstanding the foregoing, Offerings
will be limited under the Plan so that no Eligible Employee will be permitted
to purchase shares of Common Stock under all "employee stock purchase plans"
(within the meaning of section 423 of the Code) of the Company and its
Subsidiaries in excess of $25,000 of the Fair Market Value of such shares of
Common Stock (determined at the time of an Offering Date) for each calendar
year in which an Offering is outstanding at any time.
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6. PARTICIPATION IN OFFERINGS.
(a) An Eligible Employee may participate in Offerings under the
Plan by completing a subscription agreement authorizing
payroll deductions on the form provided by the Company (the
"Enrollment Form") and filing the Enrollment Form with the
Company (pursuant to such standards as procedures established
by the Committee) at least 15 Business Days before the
Offering Date of the first Offering in which such Employee
wishes to participate.
(b) Except as provided in section 7(a) below, payroll deductions
for a Participant shall begin with the first payroll following
the applicable Offering Date, and shall continue until the
Plan is terminated, subject to a withdrawal from the Plan by
the Participant as provided in section 11 below or increases
or decreases by the Participant in the amount of payroll
deductions as provided in section 7(c) below.
7. PAYROLL DEDUCTIONS.
(a) By completing and filing an Enrollment Form, an Eligible
Employee shall elect to have payroll deductions withheld from
his or her total Compensation on each payday during the time
he or she is a Participant in the Plan in such amount as he or
she shall designate on the Enrollment Form; provided, however,
that: (i) payroll deductions must be in such percentages or
whole dollar amounts, as determined by rules established by
the Committee which may change from time to time to provide
for the efficient administration of the Plan; (ii) the
Committee may establish rules limiting the amount of an
Eligible Employee's Payroll Deductions, except that any
percentage or dollar limitation must apply uniformly to all
Eligible Employees; (iii) and no Participant's payroll
deductions shall be more than $21,250 (U.S.) per calendar
year.
(b) All payroll deductions authorized by a Participant shall be
credited to an account established under the Plan for the
Participant. The funds represented by such account shall be
held as part of the Company's general assets, usable for any
corporate purpose, and the Company shall not be obligated to
segregate such funds. A Participant may not make any separate
cash payment or contribution to such account.
(c) No increases or decreases of the amount of payroll deductions
for a Participant may be made during an Offering. A
Participant may increase or decrease the amount of his or her
payroll deductions under the Plan for subsequent Offerings by
completing a new Enrollment Form and filing it with the
Company (pursuant to such standards and procedures established
by the Committee) at least 15 Business Days prior to the next
Offering Date. Such increase or decrease will become effective
on or as soon as administratively practicable following such
Offering Date.
(d) A Participant may discontinue his or her participation in the
Plan at any time as provided in section 11 below.
8. GRANT OF OPTION. On each Offering Date, each Participant shall be
granted (by operation of the Plan) an option to purchase (at the Option
Price) as many shares of Common Stock as he or she will be able to purchase
with the payroll deductions credited to his or her account during his or her
participation in the Offering beginning on such Offering Date.
Notwithstanding the foregoing, the maximum number of shares of Common Stock
that an Employee may purchase under an Offering may not exceed 500 (as may be
adjusted from time to time under section 13(b)).
9. EXERCISE OF OPTION.
(a) Unless a Participant gives written notice to the Company as
provided in subsection 9(c) below or withdraws from the Plan
pursuant to section 11 below, his or her option for the
purchase of shares of Common Stock granted under an Offering
will be exercised automatically at the Termination Date of
such Offering for the purchase of the number of whole shares
of Common Stock that the accumulated payroll deductions in the
Participant's account on such Termination Date will purchase
4
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at the applicable Option Price. Any remaining payroll
deductions attributable to a Participant shall remain in his
or her account and be used for the next offering or be paid to
the Participant pursuant to section 11(a).
(b) No Participant (or any person claiming through such
Participant) shall have any interest in any Common Stock
subject to an option under the Plan until such option has been
exercised, at which point such interest shall be limited to
that of a Common Stock shareholder of the Company. During his
or her lifetime, a Participant's option to purchase shares of
Common Stock under the Plan is exercisable only by him or her.
(c) By written notice to the Company prior to the end of the
Business Day on a Termination Date corresponding to an
Offering, a Participant may elect, effective on such
Termination Date, to withdraw all of the accumulated payroll
deductions in his or her account as of the Termination Date
(which will also constitute a notice of termination and
withdrawal pursuant to section 11(a)).
10. DELIVERY. As promptly as practicable after the Termination Date of
each Offering, the Company shall instruct its transfer agent to note on its
ledger the status of the Participant as a shareholder of the Company and to
record the number of shares of Common Stock purchased by the Participant
pursuant to the Plan. Thereafter, upon the written request of the
Participant, the Company will deliver, or instruct its transfer agent to
deliver, to such Participant, a certificate representing the shares of Common
Stock purchased to date by him or her pursuant to the terms and conditions of
the Plan. As soon as administratively practicable after the Participant's
death, certificates for Shares acquired by the Participant under the Plan
that have not been delivered previously to him or her shall be delivered in
accordance with the procedures specified in Section 14.
11. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
(a) A Participant may terminate his or her participation in the
Plan and withdraw all, but not less than all, the payroll
deductions credited to his or her account under the Plan at
any time prior to the end of the Business Day on a Termination
Date corresponding to an Offering, by giving written notice to
the Company. Such notice shall state that the Participant
wishes to terminate his or her involvement in the Plan,
specify a Termination Date and request the withdrawal of all
of the Participant's payroll deductions held under the Plan.
All of the Participant's payroll deductions credited to his or
her account will be paid to him or her as soon as practicable
after the Termination Date specified in the notice of
termination and withdrawal (or, if no such date is specified,
as soon as practical after receipt of his or her notice of
termination and withdrawal), the Participant's option for such
Offering will be automatically canceled and no further payroll
deductions for the purchase of shares of Common Stock will be
made for such Offering or for any subsequent offering, except
in accordance with a new Enrollment Form filed pursuant to
section 6 above.
(b) Upon termination, or notice of termination, of a Participant's
employment for any reason, including retirement or death, any
payroll deductions authorized under section 7 shall be
cancelled immediately. Thereafter, any payroll deductions that
were previously accumulated in the Participant's account prior
to his or her termination or notice of termination will be
applied in accordance with the provisions of Section 9.
However, if a termination of employment precludes an Employee
from being classified as an Eligible Employee with respect to
an Offering, then the payroll deductions accumulated in his or
her account will be returned to him or her as soon as
practicable after such termination or, in the case of his or
her death, to the person or persons entitled thereto under
section 14 below, and his or her option(s) will be
automatically canceled. For purposes of the Plan, the
termination date of employment shall be the Participant's last
date of actual employment and shall not include any period
during which such Participant receives any severance payments.
A transfer of employment between the Company and a Designated
Subsidiary or between one Designated Subsidiary and another
Designated Subsidiary, or absence or leave approved by the
Company, shall not be deemed a termination of employment under
this subsection 11(b).
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(c) A Participant's termination and withdrawal pursuant to
subsection 11(a) above will not have any effect upon his or
her eligibility to participate in a subsequent Offering by
completing and filing a new Enrollment Form pursuant to
section 6 above or in any similar plan that may hereafter be
adopted by the Company.
12. INTEREST. No interest shall accrue, or be payable, on a
Participant' s payroll deductions under the Plan.
13. STOCK SUBJECT TO THE PLAN.
(a) The maximum number of shares of Common Stock that shall be
reserved for sale under the Plan shall be 100,000 shares,
subject to adjustment upon changes in capitalization of the
Company as provided in subsection (b) below. The shares to be
sold to Participants under the Plan may be, at the election of
the Company, either treasury shares or shares authorized but
unissued and may be derived from shares of Common Stock
purchased by the Company. If the total number of shares of
Common Stock that would otherwise be subject to options
granted pursuant to section 8 above on any Termination Date
exceeds the number of shares then available under the Plan
(after deduction of all shares for which options have been
exercised or are then outstanding), the Company shall make a
pro rata allocation of the shares of Common Stock remaining
available for issuance in as uniform and equitable a manner as
is practicable. In such event, the Company shall give written
notice of such reduction of the number of shares subject to
the option to each Participant affected thereby and shall
return any excess funds accumulated in each Participant's
account as soon as practicable after the Termination Date of
such Offering.
(b) If any option under the Plan is exercised after any Common
Stock dividend, split-up, recapitalization, merger,
consolidation, combination or exchange of Common Stock or the
like, occurring after the shareholders of the Company approve
the Plan, the number of shares of Common Stock to which such
option shall be applicable and the Option Price for such
Common Stock shall be appropriately adjusted by the Company.
14. DISPOSITION UPON DEATH. If a Participant dies, shares of Common
Stock and/or cash, if any, attributable to the Participant's account under
the Plan (when cash or shares of Common Stock are held for his or her account
prior to exercise of options corresponding to an Offering) shall be delivered
to his or her surviving spouse; or, if there is no surviving spouse, to the
executor or administrator of the estate of the Participant; or, if no such
executor or administrator has been appointed (to the knowledge of the
Company), to his or her next of kin.
15. TRANSFERABILITY. Neither payroll deductions credited to a
Participant's account nor any rights relating to the exercise of an option or
to receive shares of Common Stock under the Plan may be assigned,
transferred, pledged or otherwise disposed of in any way (other than by will,
the laws of descent and distribution, or as provided in section 14 above) by
the Participant. Any such attempt at assignment, transfer, pledge or other
disposition shall be without effect, except that the Company may treat such
act as an election to withdraw funds in accordance with section 11(a) above.
16. SHARE TRANSFER RESTRICTIONS.
(a) Shares of Common Stock shall not be issued under the Plan
unless such issuance is either registered under the Securities
Act or is exempt from such registrations.
(b) Shares of Common Stock issued under the Plan may not be sold,
assigned, transferred, pledged encumbered, or otherwise
disposed of (whether voluntarily or involuntarily) except
pursuant to registration under the Securities Act or pursuant
to exemptions from registration.
(c) Notwithstanding any other provision of the Plan or any
documents entered into pursuant to the Plan, except as
permitted by the Committee in its sole discretion, any shares
of Common Stock issued to a Participant who is an Insider may
not be sold, assigned, transferred, pledged, encumbered or
<PAGE>
otherwise disposed of for a six-month period until after the
Option Price is determined on a Termination Date corresponding
to the Offering with respect to which they were issued.
17. AMENDMENT OR TERMINATION. The Plan may be amended by the Committee
from time to time to the extent that the Committee deems necessary or
appropriate in light of, and consistent with, section 423 of the Code;
provided, however, that any amendment that either changes the composition,
function or duties of the Committee or modifies the terms and conditions
pursuant to which options are granted hereunder must be approved by the
Board. The Board also may terminate the Plan or the granting of options
pursuant to the Plan at any time; provided, however, that the Board shall not
have the right to modify, cancel, or amend any outstanding option granted
pursuant to the Plan before such termination unless each Participant consents
in writing to such modification, amendment or cancellation. The Plan shall
terminate automatically if it is not approved by the Shareholders of the
Company, in accordance with Treas. Reg. section 1.423-2(c), by April 30, 2000.
Notwithstanding the foregoing, no amendment adopted by either the Committee
or the Board shall be effective, without approval of the shareholders of the
Company, if shareholder approval of the amendment is then required pursuant
to section 423 of the Code.
18. NOTICES. All notices or other communications by a Participant to the
Company in connection with the Plan shall be deemed to have been duly given
when received by the Secretary of the Company or by any other person
designated by the Company for the receipt of such notices or other
communications, in the form and at the location specified by the Company.
19. EFFECTIVE DATE OF PLAN. The Plan shall be effective as of January 1,
2000. The Plan has been adopted by the Board subject to shareholder approval,
and prior to shareholder approval shares of Common Stock issued under the
Plan are subject to such approval.
20. MISCELLANEOUS.
(a) HEADINGS AND GENDER. The headings to sections in the Plan have
been included for convenience of reference only. The masculine
pronoun shall include the feminine and the singular the
plural, whenever appropriate. Except as otherwise expressly
indicated, all references to sections in the Plan shall be to
sections of the Plan.
(b) GOVERNING LAW. The Plan shall be interpreted and construed in
accordance with the internal laws of the State of Illinois to
the extent that such laws are not superseded by the laws of
the United States of America.
(c) PLAN NOT A CONTRACT OF EMPLOYMENT. The Plan does not
constitute a contract of employment and participation in the
Plan does not give any Employee or Participant the right to be
retained in the employ of the Company or a Designated
Subsidiary, nor give any person a right or claim to any
benefit under the Plan, unless such right or claim has
specifically accrued under the terms of the Plan.
<PAGE>
APPENDIX B
SAMES CORPORATION
AMENDED AND RESTATED
1996 STOCK OPTION PLAN
ARTICLE 1.
ESTABLISHMENT, OBJECTIVES, AND DURATION
1.1 ESTABLISHMENT OF THE PLAN. SAMES CORPORATION, a Delaware
corporation (formerly known as Binks Sames Corporation) (hereinafter referred to
as the "Company"), has previously established an incentive compensation plan
known as the Binks Sames Corporation Amended and Restated 1996 Stock Option Plan
(hereinafter referred to as the "Plan"), effective as of October 24, 1996 (the
"Effective Date").
The Company now desires to further amend and restate the Plan as
provided herein. Subject to approval by the Company's stockholders, the Plan as
amended and restated herein shall become effective as of April 25, 2000, and
shall remain in effect as provided in Section 1.3 hereof.
1.2 PURPOSE OF THE PLAN. The purpose of this Plan is to benefit the
Company and its subsidiaries and affiliated companies by enabling the Company to
offer to certain present and future executives, key personnel, consultants and
non-employee directors stock based incentives in the Company, thereby giving
them a stake in the growth and prosperity of the Company and encouraging the
continuance of their services with the Company or subsidiaries or affiliated
companies.
1.3. DURATION OF THE PLAN. The Plan shall commence on the Effective
Date and shall remain in effect, subject to the right of the Board of Directors
to amend or terminate the Plan at any time pursuant to Article 16 hereof, until
all Shares subject to it shall have been purchased or acquired according to the
Plan's provisions. However, in no event may an Award be granted under the Plan
on or after October 24, 2006.
ARTICLE 2.
DEFINITIONS
Whenever used in the Plan, the following terms shall have the meanings
set forth below, and when the meaning is intended, the initial letter of the
word shall be capitalized:
"AWARD" means, individually or collectively, a grant under this Plan of
Nonqualified Stock Options or Incentive Stock Options.
"AWARD AGREEMENT" means a writing provided by the Company to each
Participant setting forth the terms and provisions applicable to Awards granted
under this Plan. The Participant's acceptance of the terms of the Award
Agreement shall be evidenced by his or her continued employment without written
objection before any exercise or payment of the Award. If the Participant
objects in writing, the grant of the Award shall be revoked.
"BENEFICIAL OWNER" or "BENEFICIAL OWNERSHIP" shall have the meaning
ascribed to such term in Rule 13d-3 of the General Rules and Regulations under
the Exchange Act.
"BOARD" or "BOARD OF DIRECTORS" means the Board of Directors of the
Company.
"CAUSE" shall mean, with respect to termination of a Participant's
employment or directorship, the occurrence of any one or more of the following,
as determined by the Committee, in the exercise of good faith and reasonable
judgment:
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(i) In the case where there is no employment, change in control or
similar agreement in effect between the Participant and the
Company or a Subsidiary at the time of the grant of the Award,
or where there is such an agreement but the agreement does not
define "cause" (or similar words) or a "cause" termination
would not be permitted under such agreement at that time
because other conditions were not satisfied, the termination
of an employment or consulting arrangement due to the willful
and continued failure or refusal by the Participant to
substantially perform assigned duties (other than any such
failure resulting from the Participant's Disability), the
Participant's dishonesty or theft, the Participant's violation
of any obligations or duties under any employee agreement, or
the Participant's gross negligence or willful misconduct; or
(ii) In the case where there is an employment, change in control or
similar agreement in effect between the Participant and the
Company or a Subsidiary at the time of the grant of the Award
that defines "cause" (or similar words) and a "cause"
termination would be permitted under such agreement at that
time, the termination of an employment or consulting
arrangement that is or would be deemed to be for "cause" (or
similar words) as defined in such agreement.
No act or failure to act on a Participant's part shall be considered willful
unless done, or omitted to be done, by the Participant not in good faith and
without reasonable belief that his action or omission was in the best interest
of the Company.
"CHANGE OF CONTROL" of the Company shall mean:
(a) The Company is merged or consolidated or reorganized into or
with another corporation or other legal person (an "Acquiror")
and as a result of such merger, consolidation or
reorganization less than 50% of the outstanding voting
securities or other capital interests of the surviving,
resulting or acquiring corporation or other legal person are
owned in the aggregate by the stockholders of the Company,
directly or indirectly, immediately prior to such merger,
consolidation or reorganization, other than by the Acquiror or
any corporation or other legal person controlling, controlled
by or under common control with the Acquiror;
(b) The Company sells all or substantially all of its business
and/or assets to an Acquiror, of which less than 50% of the
outstanding voting securities or other capital interests are
owned in the aggregate by the stockholders of the Company,
directly or indirectly, immediately prior to such sale, other
than by any corporation or other legal person controlling,
controlled by or under common control with the Acquiror;
(c) There is a report filed on Schedule 13D or Schedule 14D-1 (or
any successor schedule, form or report), each as promulgated
pursuant to the Exchange Act, or other public announcement
disclosing that any person or group (as the terms "person" and
"group" are used in Section 13(d)(3) or Section 14(d)(2) of
the Exchange Act and the rules and regulations promulgated
thereunder) has become the beneficial owner (as the term
"beneficial owner" is defined under Rule 13d-3 or any
successor rule or regulation promulgated under the Exchange
Act) of 15% or more of the issued and outstanding shares of
voting securities of Company, other than (i) a trustee or
other fiduciary holding securities under any employee benefit
plan of the Company or any Subsidiary, (ii) a corporation
owned directly or indirectly by the stockholders of the
Company in substantially the same proportion as their
ownership of stock in the Company, (iii) Burke B. Roche, his
spouse or any of their descendants or any spouse of their
descendants, William B. Roche, his spouse or any of their
descendants or any spouse of their descendants, any trust or
other arrangement for the benefit of Burke B. Roche, William
B. Roche, the spouse of either of them, or any of their
descendants or the spouse of any such descendants (Burke B.
Roche, William B. Roche and such other individuals, trusts or
other arrangements, collectively, the "Roche Family"), or (iv)
any group which includes the Roche Family if a majority of the
voting securities of the Company beneficially owned by such
group are beneficially owned by the Roche Family; or
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(d) Individuals who are members of the Incumbent Board cease to
constitute a majority of the Board of Directors of the
Company. For this purpose, "Incumbent Board" means (i) the
members of the Board of Directors of the Company on the
Effective Date and (ii) any individual who becomes a member of
the Board of Directors of the Company after the Effective
Date, if such individual's election or nomination for election
as a Director was approved by the affirmative vote of the then
Incumbent Board.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation thereto.
"COMMITTEE" means the Committee as specified in Article 3 herein
appointed by the Board to administer the Plan with respect to grants of Awards.
"COMMON STOCK" means the common stock, $1.00 par value per share, of
the Company.
"COMPANY" means Binks Manufacturing Company, a Delaware corporation, as
well as any successor to such entity as provided in Article 13 herein.
"DIRECTOR" means any individual who is a member of the Board of
Directors of the Company.
"DISABILITY" shall have the meaning ascribed to such term in the
Participant's governing long-term disability plan. If no long term disability
plan is in place with respect to a Participant, then with respect to that
Participant, Disability shall have the same meaning ascribed to such term under
Section 22(e)(3) of the Code.
"EARLY RETIREMENT" means the Participant's termination of employment
with the Company and all Subsidiaries (for reasons other than Cause) on or after
attaining age 55 having completed five or more years of employment with the
Company or Subsidiaries.
"EFFECTIVE DATE" shall have the meaning ascribed to such term in
Section 1.1 hereof.
"EMPLOYEE" means any employee of the Company or any Subsidiary, or any
consultant who provides services to the Company or any Subsidiary; provided,
that for purposes hereof, references to periods of employment or termination of
employment shall be deemed, in the case of a consultant, to be references to his
or her consulting arrangement with the Company or any Subsidiary. Non-Employee
Directors shall not be considered Employees under this Plan unless specifically
designated otherwise.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor act thereto.
"FAIR MARKET VALUE" shall mean, as of any date, the closing sales price
of the Common Stock on the American Stock Exchange Composite Tape (as reported
in THE WALL STREET JOURNAL, Midwest Edition) on such date (or if the date is not
a trading day, on the trading day next preceding the date of exercise).
"INCENTIVE STOCK OPTION" or "ISO" means an option to purchase Shares
granted under Article 6 herein and which is designated as an Incentive Stock
Option and which is intended to meet the requirements of Code Section 422.
"NON-EMPLOYEE DIRECTOR" means, as of a given date, an individual who is
a Director but who is not an Employee of the Company or any Subsidiary, and
since the date of the most recent annual meeting of stockholders at which he or
she was elected a Director (or, if he or she was not elected at an annual
meeting, the date the individual was first elected to the Board of Directors)
has not been an Employee.
"NONQUALIFIED STOCK OPTION" or "NQSO" means an option to purchase
Shares granted under Article 6 herein and which is not intended to meet the
requirements of Code Section 422.
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"OPTION" means an Incentive Stock Option or a Nonqualified Stock
Option, as described in Article 6 herein.
"OPTION PRICE" means the price at which a Share may be purchased by a
Participant pursuant to an Option.
"PARTICIPANT" means an individual who has outstanding an Award granted
under the Plan.
"PERSON" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof,
including a group as defined in Section 13(d) thereof.
"RETIREMENT" means the Participant's termination of employment with the
Company or its Subsidiaries (for reasons other than Cause) on or after the date
the Participant attains age 65, or, in the case of Non-Employee Directors, shall
mean the termination of his or her directorship (for reasons other than Cause)
on or after attaining age 55.
"SHARES" means shares of Common Stock, $1 par value per share, of the
Company.
"SUBSIDIARY" means any corporation, partnership, joint venture,
affiliate, or other entity in which the Company is the direct or indirect
beneficial owner of not less than 20% of all issued and outstanding equity
interests.
ARTICLE 3.
ADMINISTRATION
3.1 THE COMMITTEE. The Plan shall be administered by the Board, or by
the Compensation Committee of the Board, or by any other Committee appointed by
the Board. The functions of the Committee may be exercised by the full Board.
3.2 AUTHORITY OF THE COMMITTEE. Except as limited by law or by the
Certificate of Incorporation or Bylaws of the Company, and subject to the
provisions herein, the Committee shall have full power to select Employees and
consultants who shall participate in the Plan; determine the sizes and types of
Awards; determine the terms and conditions of Awards in a manner consistent with
the Plan; construe and interpret the Plan and any agreement or instrument
entered into under the Plan; establish, amend, or waive rules and regulations
for the Plan's administration; and (subject to the provisions of Article 11
herein) amend the terms and conditions of any outstanding Award to the extent
such terms and conditions are within the discretion of the Committee as provided
in the Plan. Further, the Committee shall make all other determinations which
may be necessary or advisable for the administration of the Plan. As permitted
by law, the Committee may delegate the authority granted to it herein.
3.3 DECISIONS BINDING. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan and all related orders and
resolutions of the Board shall be final, conclusive and binding on all persons,
including the Company, its stockholders, Employees, Participants, and their
estates and beneficiaries.
ARTICLE 4.
SHARES SUBJECT TO THE PLAN AND MAXIMUM AWARDS
4.1 SHARES AVAILABLE FOR AWARDS. The aggregate number of Shares which
may be issued or used for reference purposes under this Plan or with respect to
which Awards may be granted shall not exceed 300,000 Shares (subject to
adjustment as provided in Section 4.3), which may be either authorized and
unissued Shares or Shares held in or acquired for the treasury of the Company.
Of the aggregate number of Shares, up to all of such Shares may be issued with
respect to Incentive Stock Option Awards. Upon:
(a) a cancellation, termination, expiration, forfeiture, or lapse
for any reason of any Award; or
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(b) payment of an Option Price and/or payment of any taxes arising
upon exercise of an Option with previously acquired Shares or
by withholding Shares which otherwise would be acquired on
exercise or issued upon such payout,
then the number of Shares underlying any such Award which were not issued as a
result of any of the foregoing actions shall again be available for the purposes
of Awards under the Plan.
4.2 INDIVIDUAL PARTICIPANT LIMITATIONS. Subject to adjustment as
provided in Section 4.3 herein, the maximum aggregate number of Shares with
respect to which Options may be granted in any one fiscal year to a Participant
shall be 50,000.
4.3 ADJUSTMENTS IN AUTHORIZED SHARES. In the event of any change in
corporate capitalization, such as a stock split, or a corporate transaction,
such as any merger, consolidation, separation, including a spin-off, or other
distribution of stock or property of the Company, any reorganization (whether or
not such reorganization comes within the definition of such term in Code Section
368) or any partial or complete liquidation of the Company, such adjustment
shall be made in the number and class of Shares available for Awards, the number
and class of and/or price of Shares subject to outstanding Awards granted under
the Plan and the number of Shares set forth in Sections 4.1 and 4.2, as may be
determined to be appropriate and equitable by the Committee, in its sole
discretion, to prevent dilution or enlargement of rights; provided, however,
that the number of Shares subject to any Award shall always be a whole number.
ARTICLE 5.
ELIGIBILITY AND PARTICIPATION
5.1 ELIGIBILITY. Persons eligible to participate in this Plan include
all Employees of the Company and its Subsidiaries, as determined by the
Committee, including Employees who are Directors and Employees who reside in
countries other than the United States of America. Non-Employee Directors shall
also be eligible to receive Awards of Nonqualified Stock Options under the Plan.
5.2 ACTUAL PARTICIPATION. Subject to the provisions of the Plan, the
Committee may, from time to time, select from all eligible Employees, those to
whom Awards shall be granted and shall determine the nature and amount of each
Award.
ARTICLE 6.
STOCK OPTIONS
6.1 GRANT OF OPTIONS. Subject to the terms and provisions of the Plan,
Options may be granted to Employees at any time and from time to time as
determined by the Committee in its sole discretion. The Committee, in its sole
discretion, shall determine the number of Shares subject to each Option,
provided that during any Fiscal Year, no Participant shall be granted Options
covering more than 50,000 Shares. The Committee may grant Incentive Stock
Options, Nonqualified Stock Options, or a combination thereof.
6.2 AWARD AGREEMENT. Each Option shall be evidenced by an Award
Agreement that shall specify the Exercise Price, the expiration date of the
Option, the number of Shares to which the Option pertains, any conditions to
exercise of the Option, and such other terms and conditions as the Committee, in
its discretion, shall determine. The Award Agreement shall specify whether the
Option is intended to be an Incentive Stock Option or Nonqualified Stock Option.
6.3 EXERCISE PRICE. Subject to the provisions of this Section 6.3, the
Exercise Price for each Option shall be determined by the Committee in its sole
discretion.
(a) NONQUALIFIED STOCK OPTIONS. In the case of a Nonqualified
Stock Option, the Exercise Price shall be not less than the
Fair Market Value of a Share on the Grant Date.
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(b) INCENTIVE STOCK OPTIONS. In the case of an Incentive Stock
Option, the Exercise Price shall be not less than one hundred
percent (100%) of the Fair Market Value of a Share on the
Grant Date; provided, however, that if on the Grant Date, the
Employee (together with persons whose stock ownership is
attributed to the Employee pursuant to Section 424(d) of the
Code) owns stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company
or any of its Subsidiaries, the Exercise Price shall be not
less than one hundred and ten percent (110%) of the Fair
Market Value of a Share on the Grant Date.
(c) SUBSTITUTE OPTIONS. Notwithstanding the provisions of Sections
6.3(a) and 6.3(b), in the event that the Company or a
Subsidiary consummates a transaction described in Section
424(a) of the Code (E.G., the acquisition of property or stock
from an unrelated corporation), persons who become Employees
on account of such transaction may be granted Options in
substitution for options granted by their former employer. If
such substitute Options are granted, the Committee, in its
sole discretion and consistent with Section 424(a) of the
Code, shall determine the Exercise Price of such substitute
Options.
6.4 EXPIRATION OF OPTIONS. Subject to the provisions of Section 6.8,
Options granted pursuant to this Article 6 shall expire in accordance with this
Section 6.4.
(a) EXPIRATION DATES. Each Option granted pursuant to this Article
6 shall terminate no later than the first to occur of the
following events:
(i) The date for termination of the Option set forth in
the written Award Agreement; or
(ii) The expiration of ten (10) years from the Grant Date;
or
(iii) The expiration of one (1) month from the date of the
Participant's termination of employment for a reason
other than the Participant's death, Disability,
Retirement, Early Retirement (under circumstances
described in Section 6.4(b) below relating to
retirement from the industry) or for Cause; or
(iv) The expiration of three (3) years from the date of
the Participant's termination of employment by reason
of death or Disability; or
(v) The date of termination of employment in the event of
a termination for Cause.
(b) EFFECT OF DEATH, DISABILITY, RETIREMENT AND EARLY RETIREMENT.
Notwithstanding Section 6.4(a):
(i) Upon the death or Disability of the Participant, each
Option held by the Participant shall become
exercisable in full (without regard to any
installment or other vesting provisions thereof) and
shall be exercisable thereafter until the first to
occur of the dates set forth in Section 6.4(a)(i),
(ii) or (iv).
(ii) Upon Retirement, each Option held by the Participant
shall become exercisable in full (without regard to
any installment or other vesting provisions thereof)
and shall be exercisable by the Participant until the
earlier of the date of termination of the Option set
forth in the Award Agreement or the expiration of ten
(10) years from the Grant Date of the Option.
(iii) Upon Early Retirement, each Option held by a
Participant who from such Early Retirement retires
and remains retired from the industry (a "sunset
arrangement")
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shall remain outstanding and, to the extent not then
exercisable, shall become exercisable in accordance
with the installment or other vesting provisions
thereof as if the Participant continued as an
Employee of the Company or a Subsidiary during such
sunset arrangement. The Options, to the extent
exercisable at Early Retirement or which become
exercisable during the sunset arrangement shall
remain exercisable by the Participant until the
earlier of the date of termination of the Option set
forth in the Award Agreement or the expiration of ten
(10) years from the Grant Date. In the event the
Participant does not remain so retired in accordance
with the sunset arrangement, then the Participant
shall be deemed to have terminated employment under
circumstances described in Section 6.4(a)(iii) above
as of such date he or she fails to be so retired and
his or her Options shall terminate on the first to
occur of the dates set forth in Section 6.4(a)(i),
(ii) or (iii).
(iv) In the event of the death of the Participant after
his Retirement or Early Retirement, but prior to the
expiration of his or her Options, then his or her
Options shall be exercisable in full by his or her
beneficiaries until the earlier of the date such
Options would have expired had the Participant
survived until such date or the expiration of three
(3) years for the date of the Participant's death.
(c) COMMITTEE DISCRETION. Subject to the limits of Section 6.4(a)
and (b) above, the Committee, in its sole discretion shall
provide in each Award Agreement when each Option expires and
becomes unexercisable. In the event the Award Agreement does
not set forth such provisions, then the Option evidenced
thereby shall expire and become unexercisable in accordance
with the provisions of Section 6.4(a) and (b) above.
6.5 EXERCISABILITY OF OPTIONS. Options granted under the Plan shall be
exercisable at such times and be subject to such restrictions and conditions as
the Committee shall determine in its sole discretion and prescribe in the Award
Agreement. In the event that the Award Agreement does not set forth times with
respect to the exercisability of Options, then each such Option granted to an
Employee shall become exercisable on the first anniversary of the Grant Date to
the extent of one-fourth (25%) of the Shares which may be purchased under the
Option (rounded down to the nearest whole number), and on each of the second,
third and fourth anniversary of the Grant Date to the extent of an additional
one-fourth (25%) of such Shares. After an Option is granted, the Committee, in
its sole discretion, may accelerate the exercisability of the Option.
Notwithstanding the foregoing, upon a Change in Control, any and all Options
granted under this Article 6 shall become immediately exercisable in full.
6.6 PAYMENT. Options shall be exercised by the Participant's delivery
of a written notice of exercise to the Secretary of the Company (or its
designee), setting forth the number of Shares with respect to which the Option
is to be exercised, accompanied by full payment for the Shares.
Upon the exercise of any Option, the Exercise Price shall be payable to
the Company in full in cash or its equivalent. The Committee, in its sole
discretion, also may permit exercise (a) by tendering previously acquired Shares
having an aggregate Fair Market Value at the time of exercise equal to the total
Exercise Price, or (b) by any other means which the Committee, in its sole
discretion, determines to both provide legal consideration for the Shares, and
to be consistent with the purposes of the Plan.
As soon as practicable after receipt of a written notification of
exercise and full payment for the Shares purchased, the Company shall deliver to
the Participant (or the Participant's designated broker), Share certificates
(which may be in book entry form) representing such Shares.
6.7 RESTRICTIONS ON SHARE TRANSFERABILITY. The Committee may impose
such restrictions on any Shares acquired pursuant to the exercise of an Option
as it may deem advisable, including, but not limited to, restrictions related to
applicable Federal securities laws, the requirements of any national securities
exchange or system upon which Shares are then listed or traded, or any blue sky
or state securities laws.
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6.8 CERTAIN ADDITIONAL PROVISIONS FOR INCENTIVE STOCK OPTIONS.
(a) EXERCISABILITY. The aggregate Fair Market Value
(determined on the Grant Date(s)) of the Shares with
respect to which Incentive Stock Options are
exercisable for the first time by any Employee during
any calendar year (under all plans of the Company and
its Subsidiaries) shall not exceed $100,000,
provided, however, that in the event that
acceleration of the exercisability of an Incentive
Stock Option would cause such $100,000 limitation to
be exceeded, then those Incentive Stock Options up to
such $100,000 limitation (determined in the order
such Options were granted) shall continue to be
Incentive Stock Options and the remainder shall be
Nonqualified Stock Options.
(b) TERMINATION OF EMPLOYMENT. No Incentive Stock Option
may be exercised more than three (3) months after the
Participant's termination of employment with the
Company and all Subsidiaries for any reason other
than Disability or death (in which case the Incentive
Stock Option may be exercised until the expiration of
one (1) year from the date of death or disability),
unless (i) the Participant dies during such
three-month period, in which case the Incentive Stock
Option may be exercised by his or her beneficiaries
until the expiration of one (1) year from the date of
death (this Section 6.8(b)(i) is not applicable to
Awards granted to employees of Sames S.A.), or (ii)
the Award Agreement or the Committee permits later
exercise, provided that if the Incentive Stock Option
is not exercised within such three (3) month or one
(1) year periods, whichever is applicable, then such
Incentive Stock Option shall become a Nonqualified
Stock Option.
(c) EMPLOYEES ONLY. Incentive Stock Options may be
granted only to individuals who are Employees (other
than consultants) on the Grant Date.
(d) EXPIRATION. No Incentive Stock Option may be
exercised after the expiration of ten (10) years from
the Grant Date; provided, however, that if the Option
is granted to an Employee who, together with persons
whose stock ownership is attributed to the Employee
pursuant to section 424(d) of the Code, owns stock
possessing more than 10% of the total combined voting
power of all classes of the stock of the Company or
any of its Subsidiaries, the Option may not be
exercised after the expiration of five (5) years from
the Grant Date.
ARTICLE 7.
NON-EMPLOYEE DIRECTORS
7.1 GRANTING OF OPTIONS.
(a) INITIAL AWARDS. Each Non-Employee Director who (i) is
a Non-Employee Director on the Effective Date of the
Plan or (b) first becomes a Non-Employee Director
after the Effective Date of the Plan shall be granted
a Nonqualified Stock Option to purchase 3,000 Shares.
Such Option shall be granted on either the Effective
Date of the Plan, or the date such person first
becomes a Non-Employee Director, as the case may be.
(b) ANNUAL AWARDS. Thereafter, for so long as the
Non-Employee Director remains such, he or she
annually shall be granted an Option for an additional
2,000 Shares, 3000 Shares if such Non-Employee
Director shall also be serving as Chairman of the
Board. Each such Option shall be granted on the date
of each Annual Meeting of Stockholders, commencing
with the 1997 Annual Meeting of Stockholders, but
only if the Non-Employee Director will continue to
serve as a Director after such Annual Meeting.
(c) OTHER AWARDS. The Board of Directors may in its
discretion increase the number of Shares subject to
an initial Award or annual Award in recognition of
significant additional duties
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and responsibilities assumed by a Non-Employee
Director in connection with his or her service as
chairman of the Board of Directors or other positions
on the Board of Directors.
(d) NON-EMPLOYEE DIRECTORS OF SAMES S.A. All Non-Employee
Directors of Sames S.A. are excluded from the scope
of this Article 7.
7.2 TERMS OF OPTIONS.
(a) OPTION AGREEMENT. Each Option granted pursuant to
this Article 7 shall be evidenced by an Award
Agreement which shall be executed by the Participant
and the Company.
(b) EXERCISE PRICE. The Exercise Price for the Shares
subject to each Option granted pursuant to this
Article 7 shall be 100% of the Fair Market Value of
such Shares on the Grant Date.
(c) EXERCISABILITY. Each initial Award granted pursuant
to Section 7.1(a) shall become exercisable on the
first anniversary of the Grant Date to the extent of
one-fourth (25%) of the Shares which may be purchased
under the Option (rounded down to the nearest whole
number), and on each of the second, third and fourth
anniversary of the Grant Date to the extent of an
additional one-fourth (25%) of such Shares. After an
Option is granted, the Committee, in its sole
discretion, may accelerate the exercisability of the
Option. Notwithstanding the foregoing, upon a Change
in Control, any and all Options granted under this
Article 7 shall become immediately exercisable in
full. Each annual Award granted pursuant to Section
7.1(b) shall become exercisable in full on the first
anniversary of the Grant Date.
(d) EXPIRATION OF OPTIONS. Each Option granted under this
Article 7 shall terminate upon the first to occur of
the following events:
(i) The expiration of ten (10) years from the
Grant Date; or
(ii) The expiration of one (1) month from the
date of the termination of the Participant's
service as a Director for a reason other
than death, Disability, Retirement or Cause;
or
(iii) The expiration of three (3) years from the
date of the termination of the Participant's
service as a Director by reason of death or
Disability; or
(iv) The date of termination of the Participant's
service as a Director for Cause.
(e) EFFECT OF DEATH, DISABILITY OR RETIREMENT.
(i) Upon the death or Disability of the
Participant, each Option granted under this
Article 7 held by the Participant shall
become exercisable in full (without regard
to any installment or other vesting
provisions thereof) and shall be exercisable
thereafter until the first to occur of the
dates set forth in Section 7.2(d)(i) or
(iii).
(ii) Upon Retirement, each Option granted under
this Article 7 held by the Participant shall
become exercisable in full (without regard
to any installment or other vesting
provisions thereof) and shall be exercisable
by the Participant until the expiration of
ten (10) years from the Grant Date of the
Option.
(iii) In the event of the death of the Participant
after his or her Retirement, but prior to
the expiration of his or her Options granted
under this Article 7, such Options shall be
exercisable in full by his or her
beneficiaries until the earlier of the date
such
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Options would have expired had the
Participant survived until such date or the
expiration of three (3) years from the date
of the Participant's death.
(f) OTHER TERMS. All provisions of the Plan not
inconsistent with this Article 7 shall apply to
Options granted to Non-Employee Directors.
ARTICLE 8.
BENEFICIARY DESIGNATION
Each Participant under the Plan may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit under the Plan is to be paid in case of his or her death before
he or she receives any or all of such benefit. Each such designation shall
revoke all prior designations by the same Participant, shall be in a form
prescribed by the Company, and will be effective only when filed by the
Participant in writing with the Secretary of the Company during the
Participant's lifetime. In the absence of any such designation, benefits
remaining unpaid at the Participant's death shall be paid to the Participant's
estate. Provided, however, Awards granted to employees of Sames S.A. shall be
excluded from this Article 8.
ARTICLE 9.
DEFERRALS
The Committee may permit a Participant to defer such Participant's
receipt of the delivery of Shares that would otherwise be due to such
Participant upon the exercise of any Option.
ARTICLE 10.
LIMITED TRANSFERABILITY
The Committee may, in its discretion, authorize all or a portion of the
Options (other than Incentive Stock Options) granted to a Participant to be on
terms which permit transfer by such Participant to (a) the spouse, children or
grandchildren of the Participant ("Immediate Family Members"), (b) a trust or
trusts for the exclusive benefit of such Immediate Family Members, or (c) a
partnership in which such Immediate Family Members are the only partners,
provided that (i) there may be no consideration for any such transfer, (ii) the
Award Agreement pursuant to which such Options are granted expressly provides
for transferability in a manner consistent with this Article 10, and (iii)
subsequent transfers of transferred Options shall be prohibited except those in
accordance with Article 8. Following transfer, any such Options shall continue
to be subject to the same terms and conditions as were applicable immediately
prior to transfer, provided that for purposes of Article 8 hereof the term
"Participant" shall be deemed to refer to the transferee. The provisions of
Articles 6 and 7 relating to the period of exercisability and expiration of the
Option shall continue to be applied with respect to the original Participant,
and the Options shall be exercisable by the transferee only to the extent, and
for the periods, set forth in said Articles 6 and 7.
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ARTICLE 11.
AMENDMENT, MODIFICATION, AND TERMINATION
11.1 AMENDMENT, MODIFICATION, AND TERMINATION. The Board may at any
time and from time to time, alter, amend, suspend or terminate the Plan in whole
or in part; subject to any requirement of stockholder approval imposed by
applicable law, rule or regulation.
11.2 AWARDS PREVIOUSLY GRANTED. No termination, amendment, or
modification of the Plan shall adversely affect in any material way any Award
previously granted under the Plan, without the written consent of the
Participant holding such Award.
ARTICLE 12.
WITHHOLDING
12.1 TAX WITHHOLDING. The Company shall have the power and the right to
deduct or withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy Federal, state, and local taxes, domestic or foreign,
required by law or regulation to be withheld with respect to any taxable event
arising as a result of the Plan.
12.2 SHARE WITHHOLDING. With respect to withholding required upon the
exercise of Options, or upon any other taxable event arising as a result of
Awards granted hereunder, Participants may elect to satisfy the withholding
requirement, in whole or in part, by having the Company withhold Shares having a
Fair Market Value on the date the tax is to be determined equal to the minimum
statutory total tax which would be imposed on the transaction. All such
elections shall be irrevocable, made in writing, signed by the Participant, and
shall be subject to any restrictions or limitations that the Committee, in its
sole discretion, deems appropriate.
ARTICLE 13.
SUCCESSORS
All obligations of the Company under the Plan with respect to Awards
granted hereunder shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect merger,
consolidation, purchase of all or substantially all of the business and/or
assets of the Company or otherwise.
ARTICLE 14.
LEGAL CONSTRUCTION
14.1 GENDER AND NUMBER. Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine; the
plural shall include the singular and the singular shall include the plural.
14.2 SEVERABILITY. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.
14.3 REQUIREMENTS OF LAW. The granting of Awards and the issuance of
Shares under the Plan shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.
14.4 GOVERNING LAW. To the extent not preempted by Federal law, the
Plan, and all agreements hereunder, shall be construed in accordance with and
governed by the laws of the State of Delaware.
11
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ARTICLE 15.
COMMITTEE DISCRETION IN CONNECTION
WITH AWARDS TO FOREIGN EMPLOYEES
Notwithstanding any provision of this Plan to the contrary, with
respect to the grant of any Award to an individual employed in a foreign
country, the Committee in its sole discretion may provide in the Award Agreement
for such Awards terms and provisions as the Committee shall deem necessary or
appropriate to enable such Award to comply with applicable foreign law,
provided, however, that except for Awards granted pursuant to Section 6.3(c) of
the Plan, in no event shall the exercise price of any award be less than Fair
Market Value as of the Grant Date.
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PROXY SAMES CORPORATION PROXY
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 25, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
Arnold H. Dratt and Wayne F. Edwards, or any of them, with full power of
substitution, are hereby authorized to vote the shares of Capital Stock of
Sames Corporation (the "Company") which the undersigned is entitled to vote
at the Annual Meeting of Stockholders to be held at the offices of Vedder,
Price, Kaufman & Kammholz at 222 North LaSalle Street, 26th Floor, Chicago,
Illinois 60601 on April 25, 2000, at 9:00 a.m., and at all adjournments
thereof, as follows:
PLEASE SIGN AND DATE THIS PROXY ON THE REVERSE SIDE HEREOF AND
RETURN PROMPTLY USING THE ENCLOSED ENVELOPE.
<PAGE>
[reverse]
1. ELECTION OF DIRECTOR
Wayne F. Edwards
______For ______Withhold ______For all Except
2. Approval of the Sames Employee Stock Purchase Plan.
______For ______Against ______Abstain
3. Approval of an amendment to the Company's Amended and Restated 1996 Stock
Option Plan.
______For ______Against ______Abstain
4. Ratification of the appointment of KPMG LLP as the Company's independent
accountants for the fiscal year ending December 31, 2000.
______For ______Against ______Abstain
5. In their discretion, the proxies are authorized to vote upon such other
matters as may properly come before the meeting.
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED HEREIN. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" THE PROPOSALS NOTED ABOVE.
Please sign your name or names on the signature lines below in the exact form
appearing hereon.
Dated ____________________________ ,2000
__________________________________
Signature of Stockholder(s)
__________________________________
Signature of Stockholder(s)
