<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
BMC INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
BMC
INDUSTRIES, INC.
ONE MERIDIAN CROSSINGS, SUITE 850
MINNEAPOLIS, MINNESOTA 55423
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 8, 1998
------------------------
TO THE STOCKHOLDERS OF BMC INDUSTRIES, INC.:
The Annual Meeting of Stockholders of BMC Industries, Inc. will be held at
the Atrium Center, 3105 East 80th Street, Bloomington, Minnesota on Friday, May
8, 1998 at 10:00 a.m. local time, for the following purposes:
1. To elect three directors for a term of two years;
2. To transact such other business as properly may be brought before the
meeting or any adjournments thereof.
The close of business on March 13, 1998 has been fixed as the record date
for the determination of stockholders who are entitled to notice of and to vote
at the meeting or any adjournments thereof.
By Order of the Board of Directors
[LOGO]
Jon A. Dobson
SECRETARY
March 31, 1998
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. NO ADMISSION TICKET OR
OTHER CREDENTIALS WILL BE NECESSARY. IF YOU DO NOT PLAN TO ATTEND THE MEETING,
PLEASE BE SURE YOU ARE REPRESENTED AT THE MEETING BY MARKING, SIGNING, DATING,
AND MAILING YOUR PROXY IN THE REPLY ENVELOPE PROVIDED.
<PAGE>
BMC
INDUSTRIES, INC.
ONE MERIDIAN CROSSINGS, SUITE 850
MINNEAPOLIS, MINNESOTA 55423
------------------------
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
---------------------
INTRODUCTION
This proxy statement, which is first being mailed to stockholders on March
31, 1998, is furnished in connection with the solicitation by the Board of
Directors of BMC Industries, Inc. (the "Company") of proxies to be voted at the
Annual Meeting of Stockholders to be held at the Atrium Center, 3105 East 80th
Street, Bloomington, Minnesota on Friday, May 8, 1998, at 10:00 a.m., local
time, for the purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders, and at any adjournments thereof (the "Meeting"). The Company's
1997 Annual Report to Stockholders has been mailed to the stockholders but is
not to be considered a part of the proxy soliciting materials.
The accompanying proxy is enclosed for your use. You are solicited on behalf
of the Board of Directors of the Company (the "Board") to MARK, SIGN, DATE AND
RETURN THE PROXY IN THE ACCOMPANYING SELF-ADDRESSED ENVELOPE. The proxy is
revocable at any time before it is used at the Meeting. A proxy may be revoked
by filing a revoking instrument or a duly executed proxy bearing a later date
with the Secretary of the Company or by attending the Meeting and voting in
person. The shares represented by proxies received by the Board will be voted at
the Meeting.
The cost of soliciting proxies will be borne by the Company. Officers,
directors and regular employees of the Company may, but without compensation
other than their regular compensation, solicit proxies by mail, personal
conversation, telephone or otherwise. The Company may reimburse brokerage firms
and others for expenses incurred in forwarding solicitation material to the
beneficial owners of the Company's common stock ("Common Stock").
VOTING OF SHARES
Only holders of Common Stock of record at the close of business on March 13,
1998 (the "Record Date") will be entitled to vote at the Meeting. On March 13,
1998, the Company had 26,886,772 outstanding shares of Common Stock, each such
share entitling the holder thereof to one vote on each matter to be voted on at
the Meeting. Holders of shares of Common Stock are not entitled to cumulative
voting rights.
The presence at the Meeting, in person or by proxy, of the holders of a
majority of the outstanding shares of Common Stock entitled to vote at the
Meeting is required for a quorum for the transaction of business. In general,
shares of Common Stock represented by a properly signed and returned proxy card
will be counted as shares present and entitled to vote at the Meeting for
purposes of determining a quorum, without regard to whether the card reflects
votes against director nominees or abstentions (or is left blank) or reflects a
"broker non-vote" on a matter (i.e., a card returned by a broker on behalf of
its beneficial owner customer that is not voted on a particular matter because
voting instructions have not been received and the broker has no discretionary
authority to vote).
The election of a nominee for director requires the affirmative vote of a
majority of the shares of Common Stock present and entitled to vote in person or
by proxy on that matter (and at least a majority of the minimum number of votes
necessary for a quorum to transact business at the Meeting). Shares represented
by a proxy card voted as abstaining on any of the proposals will be treated as
shares present and entitled to vote that were not cast in favor of a particular
matter, and
1
<PAGE>
thus will be counted as votes against that matter. Shares represented by a proxy
card that includes broker non-votes on a matter will be treated as shares not
entitled to vote on that matter, and thus will not be counted in determining
whether that matter has been approved.
PROPOSAL 1
ELECTION OF DIRECTORS
NOMINATION
The Company's Second Restated Articles of Incorporation (the "Articles")
provide that the Board shall consist of not less than three nor more than 17
members, as determined from time to time by the Board of Directors, divided into
two classes of as nearly equal size as possible. The term of each class of
directors is two years, and the term of one class expires each year in rotation.
The Board currently consists of five (5) directors, with the terms of three
present members of the Board expiring as of the Meeting. The terms of the
remaining two members of the Board will not expire this year, but rather will
expire as indicated below.
The Board has determined that there will be five (5) directors of the
Company for the ensuing year. The Board has nominated Lyle D. Altman, Paul B.
Burke and Harry A. Hammerly to serve as directors of the Company for terms of
two years, expiring at the 2000 Annual Meeting of Stockholders, or until their
successors are elected and qualified.
The Board recommends a vote FOR the election of Messrs. Altman, Burke and
Hammerly. In the absence of other instructions, the proxies will be voted FOR
the election of the nominees. If the Board should learn prior to the Meeting
that any of the nominees will be unable to serve by reason of death, incapacity
or other unexpected occurrence, the proxies that otherwise would have been voted
for that nominee will be voted for such substitute nominee as may be selected by
the Board. Alternatively, the proxies, at the Board's discretion, may be voted
for such fewer number of nominees as results from such death, incapacity or
other unexpected occurrence. The Board has no reason to believe that any of the
nominees will be unable to serve.
INFORMATION ABOUT DIRECTORS AND NOMINEES
The following table gives certain information concerning the Company's
directors, including this year's nominees.
<TABLE>
<CAPTION>
NAMES OF DIRECTORS DIRECTOR
AND NOMINEES PRINCIPAL OCCUPATION AGE SINCE
- ------------------------ ------------------------------------------------------------------------ --- -----------
<S> <C> <C> <C>
NOMINEES FOR A TWO-YEAR TERM EXPIRING IN 2000:
Lyle D. Altman Former Chairman of the Board of Network Systems Corporation (data 67 1983
communications equipment)
Paul B. Burke Chairman of the Board, President and Chief Executive Officer of BMC 42 1991
Industries, Inc.
Harry A. Hammerly Former Executive Vice President and Director of 3M Company 64 1995
DIRECTORS NOT STANDING FOR ELECTION AT THE MEETING WHOSE TERMS EXPIRE IN 1999:
John W. Castro President and Chief Executive Officer of Merrill Corporation 49 1994
(diversified document services)
Joe E. Davis Former President and Chief Executive Officer of National Health 63 1982
Enterprises, Inc.; former Chairman of the Board, Linear Corporation
</TABLE>
Except as indicated below, there has been no change in the principal
occupations or employment during the past five years for the directors or
nominees for election as directors.
2
<PAGE>
In March 1995, Mr. Altman resigned as Chairman of the Board of Network
Systems Corporation ("NSC") in connection with Storage Technology Corporation's
acquisition of NSC. From September 1993 to March 1995, Mr. Altman served as
interim Chief Executive Officer of NSC. Mr. Altman previously served as
President and Chief Executive Officer of NSC until October 1991, and as its
Chief Executive Officer until April 1992.
Mr. Burke has been President of the Company since May 1991, and he has
served as its President and Chief Executive Officer since July 1991. Mr. Burke
has also served as Chairman of the Board since May 1995. Mr. Burke joined the
Company as Associate General Counsel in June 1983 and became Vice President,
Secretary and General Counsel in August 1985. In November 1987, he was appointed
Vice President, Ft. Lauderdale Operations of the Company's Vision-Ease Lens
division and in May 1989 he was appointed President of Vision-Ease Lens.
Mr. Hammerly retired from 3M Company in July 1995. He served in various
positions with 3M Company from June 1955 to July 1995, most recently as
Executive Vice President, International Operations.
The following Board members also serve as directors of the designated public
companies: Mr. Burke, Donaldson Company, Inc.; Mr. Castro, Merrill Corporation;
Mr. Davis, Anworth Mortgage Asset Corporation, American Variable Insurance
Series and Wilshire Technologies, Inc.; and Mr. Hammerly, Apogee Enterprises,
Inc., Brown and Sharp Manufacturing Company, Cincinnati Milacron, Inc. and The
Geon Company.
INFORMATION ABOUT THE BOARD AND ITS COMMITTEES
COMMITTEES. The business and affairs of the Company are managed by the
Board, which met six (6) times in 1997. The Board maintains several standing
committees, including Audit, Compensation, Finance and Corporate Governance
Committees. The Audit Committee oversees the Company's Internal Audit Department
and the provision of outside audit services. It met two (2) times in 1997. The
Compensation Committee reviews and approves compensation for all elected
executive officers; reviews, approves and modifies all general compensation
matters; and sets the terms of, and grants awards under, the Company's 1994
Stock Incentive Plan and any other incentive plans. The Compensation Committee
met four (4) times during 1997. The Finance Committee approves the Company's
dividends payable to stockholders and reviews the Company's long-range financing
plan. The Finance Committee met four (4) times during 1997. The Corporate
Governance Committee is authorized to identify, evaluate and nominate persons
for election to the Board and to make recommendations to the Board with respect
to such persons. The Corporate Governance Committee will consider nominees
recommended by stockholders if submitted in writing to the Committee Chair. The
Company's Restated Bylaws also permit any stockholder entitled to vote for the
election of directors to make nominations directly, without first recommending
the nominee to the Corporate Governance Committee. Under the Restated Bylaws,
any such nomination made by a stockholder must be made by written notice to the
Company's Secretary not less than 120 days prior to the Annual Meeting of
Stockholders or special meeting called for the election of directors (as the
case may be). The motion must include each nominee's name, age, business address
and residence address, principal occupation and beneficial share ownership,
together with the class of directors to which the nominee is being nominated and
such other information as would be required in a proxy solicitation concerning
the nominee under the Securities and Exchange Commission's proxy rules. The
Corporate Governance Committee met three (3) times in 1997.
The Audit, Compensation, Finance and Corporate Governance Committees are
presently comprised of the following incumbent directors of the Company:
<TABLE>
<CAPTION>
AUDIT COMPENSATION FINANCE CORPORATE GOVERNANCE
COMMITTEE COMMITTEE COMMITTEE COMMITTEE
- --------------------------- --------------------------- ------------------------ ---------------------------------
<S> <C> <C> <C>
Lyle D. Altman (Chair) John W. Castro (Chair) Joe E. Davis (Chair) Harry A. Hammerly (Chair)
Joe E. Davis Harry A. Hammerly Lyle D. Altman John W. Castro
Harry A. Hammerly
</TABLE>
3
<PAGE>
DIRECTORS' FEES. As an employee of the Company, Mr. Burke is not paid a
director's fee. Non-employee directors are paid an annual retainer of $15,000,
$1,000 per Board meeting attended and $1,000 ($1,200 in the case of the
committee Chair) per committee meeting attended.
DIRECTORS' DEFERRED COMPENSATION PLAN. On December 7, 1984, the Board of
Directors adopted the Directors' Deferred Compensation Plan (the "Deferred
Plan"), which is administered by the Secretary of the Company in conjunction
with the Human Resources Department. Each non-employee member of the Board of
Directors may elect to participate and defer his or her receipt of the fees
described above. The amount of each participating director's compensation
deferred under the Deferred Plan is credited to a separate bookkeeping account
in the director's name. Participants can elect to have compensation credited to
a phantom investment options account ("Investment Account") or an "Interest
Income" account ("Interest Account"). Compensation credited to the Investment
Account is converted into share equivalents of up to three (3) mutual funds
("Phantom Investments") chosen from a variety of equity and bond fund options.
The value of Phantom Investments credited to the Investment Account, and,
consequently the value of a participating director's account, increases or
decreases depending on the market performance of the underlying mutual funds
chosen as Phantom Investments. Compensation credited to the Interest Account
earns interest computed on the beginning balance each quarter at an annual rate
equal to the effective cost of borrowing under the Company's revolving credit
agreements in effect during the quarter. Amounts credited to participating
directors' accounts are payable in cash in a lump sum or in two to ten annual
installments, at the option of the participant, upon termination from the Board
of Directors. During the past three years, $59,400 was deferred under the
Deferred Plan by one current director who is not an executive officer.
NON-EMPLOYEE DIRECTOR STOCK OPTIONS. On December 10, 1993, the Board
adopted the 1994 Stock Incentive Plan (the "1994 Plan") which subsequently was
approved by the Company's stockholders at the 1994 Annual Meeting of
Stockholders. The 1994 Plan provides for automatic non-qualified option grants
to the Company's non-employee directors. Effective as of January 1, 1997, the
Board amended the 1994 Plan to provide for an automatic, one-time grant to
directors filling new directorships or vacancies of non-qualified options to
purchase 10,000 shares of Common Stock, at an exercise price equal to the fair
market value of the Common Stock on the date of their election or appointment.
Prior to January 1, 1997, directors received non-qualified options to purchase
20,000 shares of Common Stock on the date of their election or appointment. The
1994 Plan further provides that on the date of each subsequent Annual Meeting of
Stockholders, each non-employee director will automatically be granted
additional options to purchase 4,000 shares of Common Stock at the fair market
value of the Common Stock on the date of grant. Each option becomes exercisable
in full three years after the date of grant and terminates five years after its
date of grant. If a non-employee director ceases to serve as a director for any
reason other than death, disability or mandatory retirement, all options held by
such director will continue to become exercisable and expire in accordance with
their original terms. All options become immediately exercisable in the event of
a director's death, disability or mandatory retirement.
In 1997, all of the incumbent directors attended 75% or more of the
aggregate meetings of the Board and all such committees on which they served.
4
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Set forth in the following table is information, as of March 13, 1998
(unless otherwise indicated), pertaining to persons who, to the best of the
Company's knowledge, owned beneficially more than five percent (5%) of the
outstanding Common Stock of the Company. Also set forth below is information
with respect to shares of Common Stock beneficially held by the Company's
directors and the Company's executive officers named in the "Summary
Compensation Table", which appears below under the heading "Executive
Compensation", and for all directors and executive officers as a group.
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED(1)
-----------------------------
PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER AMOUNT OF CLASS
- ---------------------------------------------------- --------------- ------------
<S> <C> <C>
Neuberger & Berman, LLC 2,313,580(2) 8.6
605 Third Avenue
New York, NY 10158-3698
Reich & Tang Asset Management L.P. 1,508,900(3) 5.6
600 Fifth Avenue
New York, NY 10020
American Century Companies, Inc. 1,451,000(4) 5.4
4500 Main Street
Kansas City, MO 64141-9210
Lyle D. Altman 40,000(5) *
Paul B. Burke 925,161(6) 3.4
John W. Castro 42,000(7) *
Joe E. Davis 119,200(8) *
John L. Gburek 18,758(9) *
William A. Guernsey 122,971(10) *
Harry A. Hammerly 2,500 *
Michael P. Hawks 111,230(11) *
Ray B. Rogers 56,611(12) *
All Directors and Executive Officers as a group (9 1,438,431(13) 5.2
persons)
</TABLE>
- ------------------------
* = less than 1%.
(1) Unless otherwise noted, all of the shares shown are held by individuals or
entities possessing sole voting and investment power with respect to such
shares. Unless otherwise noted, share amounts and percentages are as of
March 13, 1998. Shares not outstanding but deemed beneficially owned by an
individual or by members of the group (as the case may be) by virtue of a
right to acquire them within sixty (60) days upon the exercise of options
are treated as outstanding for purposes of determining the percent
beneficially owned by the individual or the group.
(2) As set forth in a Schedule 13G filed with the Securities and Exchange
Commission on February 12, 1998, Neuberger & Berman, LLC ("Neuberger"), a
registered investment adviser, is deemed to have beneficial ownership as of
December 31, 1997 of 2,313,580 shares. As reported in the Schedule 13G,
Neuberger possesses sole voting power with respect to 1,293,480 of such
shares, shared voting power with respect to 1,003,800 of such shares and
shared dispositive power with respect to all 2,313,580 shares. Principals of
Neuberger personally own an additional 8,500 shares, but Neuberger disclaims
beneficial ownership of these shares.
(3) As set forth in a Schedule 13G filed with the Securities and Exchange
Commission on February 13, 1998, Reich & Tang Asset Management L.P.
("Reich"), a registered investment advisor, is
5
<PAGE>
deemed to have beneficial ownership of 1,508,900 shares as of December 31,
1997. Reich possesses shared voting and dispositive power with respect to
all 1,508,900 shares.
(4) As set forth in a Schedule 13G filed with the Securities and Exchange
Commission on February 4, 1998, American Century Companies, Inc. ("ACC"),
American Century Investment Management, Inc. ("ACIM"), a registered
investment adviser and wholly-owned subsidiary of ACC, and James E. Stowers,
Jr., are deemed to have beneficial ownership of 1,451,000 shares as of
December 31, 1997. Mr. Stowers controls ACC by virtue of his beneficial
ownership of a majority of the voting stock of ACC. ACIM manages the
investments of thirteen (13) registered investment companies. ACIM also
manages the assets of institutional investor accounts. ACC, ACIM and Mr.
Stowers have sole voting and dispositive power with regard to all 1,451,000
shares, but disclaim beneficial ownership of all such shares.
(5) Includes 12,000 shares that Mr. Altman has the right to acquire within 60
days upon the exercise of options.
(6) Includes 699,600 shares that Mr. Burke has the right to acquire within 60
days upon the exercise of options; 400 shares held indirectly as custodian
for Mr. Burke's minor son; and 10,978 shares allocable to Mr. Burke as of
December 31, 1997 in connection with his participation in the Company's
401(k) savings plan.
(7) Includes 4,000 shares that Mr. Castro has the right to acquire within 60
days upon the exercise of options and 10,000 shares held by his wife, of
which Mr. Castro disclaims beneficial ownership.
(8) Includes 8,000 shares that Dr. Davis has the right to acquire within 60
days upon the exercise of options.
(9) Includes 2,000 shares that Mr. Gburek has the right to acquire within 60
days upon the exercise of options and 758 shares allocable to Mr. Gburek as
of December 31, 1997 in connection with his participation in the Company's
401(k) savings plan.
(10) Includes 38,000 shares that Mr. Guernsey has the right to acquire within 60
days upon the exercise of options and 1,091 shares allocable to Mr. Guernsey
as of December 31, 1997 in connection with his participation in the
Company's 401(k) savings plan.
(11) Includes 8,000 shares that Mr. Hawks has the right to acquire within 60
days upon the exercise of options and 1,300 shares held indirectly by Mr.
Hawks' minor children.
(12) Includes 1,000 shares that Mr. Rogers has the right to acquire within 60
days and 2,111 shares allocable to Mr. Rogers as of December 31, 1997 in
connection with his participation in the Company's 401(k) savings plan.
(13) Includes 1,700 shares held indirectly by two officers' minor children.
Includes 802,600 shares not outstanding but deemed beneficially owned by
members of the group by virtue of a right to acquire them within 60 days
upon the exercise of options. Includes 14,938 shares allocable as of
December 31, 1997 to four executive officers in connection with their
participation in the Company's 401(k) savings plan.
6
<PAGE>
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
THE COMMITTEE. The Compensation Committee of the Company's Board of
Directors (the "Committee") is comprised entirely of non-employee directors and
administers the Company's executive compensation program. See "Information About
the Board and its Committees" for a more complete description of the functions
of the Compensation Committee.
COMPENSATION PHILOSOPHY. The Company's executive compensation policy is
intended to support the achievement of the Company's desired economic
performance by:
- Providing compensation that will attract and retain superior talent and
reward performance; and
- Aligning executive officers' interests with the Company's success by
linking both annual incentive compensation and long-term incentive
compensation with the Company's success in achieving performance goals.
The executive compensation policy adopted by the Company, as approved by the
Committee, provides for an overall level of potential compensation that is at a
median level of competitiveness with manufacturing companies of comparable size.
The Committee, in reviewing compensation matters, consult with the Company's
Director of Compensation and Benefits and, as appropriate, independent
compensation consultants. The Committee makes use of a variety of independently
available compensation surveys, each of which provide compensation data for well
over 100 companies, including many of the companies in the S&P
500-Registered Trademark- and S&P Manufacturing (Diversified
Industries)-Registered Trademark- indices used in the Company's performance
graph. The compensation surveys used by the Committee report compensation data
for like-sized manufacturing companies and provide statistical analyses that
predict median compensation rates at profit and revenue levels comparable to the
Company. Actual individual compensation levels for officers of the Company may
be greater or less than median competitive levels, based upon annual and
long-term Company performance as well as individual performance. The
Compensation Committee, at its discretion, sets executive compensation at levels
which it judges are justified by external, internal or other circumstances.
ELEMENTS OF EXECUTIVE OFFICER COMPENSATION POLICY. The Company's executive
officer compensation policy is comprised of base salary, annual cash bonus
incentives and long-term incentives in the form of stock options and/or
restricted stock awards.
BASE SALARY. Base salary levels for the Company's executive officers,
including the Chief Executive Officer, are generally set at or below median
levels of competitiveness compared to manufacturing companies of similar size
and profitability. In determining individual salaries, in addition to the
comparison with similar companies, the Committee also takes into consideration
individual experience and performance, as well as competitive and comparable
data related to the executive officer's specific areas of expertise. As a matter
of philosophy, the Company does not emphasize base salaries in an executive's
total compensation package.
ANNUAL CASH BONUS INCENTIVES. Under the Company's management incentive
bonus plan (the "Bonus Plan"), executive officers and key employees of the
Company, designated by the Chief Executive Officer, may receive cash bonus
awards after the close of the fiscal year if the Company achieves financial
performance goals set by the Board for that year. Target bonus rates of a
percentage of base salary are established for each executive officer; depending
upon the individual's level of responsibility and the median level of incentive
compensation opportunity offered by like-sized manufacturing companies as
reported in salary surveys. In 1997, the Company did not achieve its established
financial performance goals. Accordingly, executive officers were not eligible
to receive a bonus under the Bonus Plan for 1997.
LONG-TERM INCENTIVES. On December 10, 1993, the Company's Board of
Directors approved the 1994 Plan which subsequently was approved by the
Company's stockholders at the 1994 Annual Meeting of Stockholders. The 1994 Plan
provides for grants to eligible employees of the Company of stock options,
restricted stock awards, performance units, stock bonuses and stock appreciation
7
<PAGE>
rights. The Committee has the discretion to select participants, the type of
award and the terms and conditions for each award, to the extent not otherwise
fixed by the terms of the 1994 Plan. Awards under the 1994 Plan are intended to
align management and stockholder long-term interests by creating a direct link
between executive compensation and stockholder return, and to enable executives
to develop and maintain an equity position in the Company.
The Committee does not rely on any single formula in determining the size of
grants or selecting recipients, but considers relevant median level competitive
data, the potential and performance of the recipient, grants made in prior years
and options which remain outstanding.
CHIEF EXECUTIVE OFFICER COMPENSATION. Base salary, incentive compensation
awards, and other compensation paid to Mr. Burke, as well as stock option awards
made to Mr. Burke during his tenure as an executive officer, are consistent with
the design of the overall program described above, and are shown in the tables
below. The potential value of Mr. Burke's compensation package is designed to
"pay for results" by placing a high degree of pay at risk and by providing
significant emphasis on stockholder value through the granting of stock options.
Annual incentive compensation is targeted at 75% of his base salary with a
maximum of 112.5%. Benefits and perquisites are not emphasized and are set at
median levels of competitiveness. Mr. Burke's base salary and his stock option
awards are determined after a review of competitive compensation compiled by
independent consultants and after taking into account the Company's performance
under his leadership. The Company's performance is measured against financial
goals for earnings, earnings per share and cash flow. Other measurements used to
evaluate Mr. Burke are stock price performance and soundness of strategic
operating plans.
Mr. Burke's 1997 base salary was $350,000. Because the Company did not meet
its financial goals for 1997 as defined by the Company's Bonus Plan, Mr. Burke
did not receive a bonus for 1997. To aid in the retention of Mr. Burke and in
recognition of his achievements, the Committee approved a grant of 200,000 stock
options in April 1997. The Committee determined the size of this grant based in
part on information provided by independent sources, including a survey
performed by an outside compensation consultant. These options will become
exercisable in five equal installments beginning in 1998.
Members of the Compensation Committee:
John W. Castro, Chairman
Harry A. Hammerly
8
<PAGE>
COMPARATIVE STOCK PERFORMANCE
The graph below compares the cumulative total stockholder return on the
Company's Common Stock for the last five fiscal years to the total cumulative
return on the S&P500-Registered Trademark- Index and the
S&P-Registered Trademark- Manufacturing (Diversified Industries) Index over the
same period, assuming a $100 investment in Common Stock and each such index on
December 31, 1992 and reinvestment of all dividends (if any).
CUMULATIVE TOTAL RETURN
BASED ON INVESTMENT OF $100 BEGINNING DECEMBER 31, 1992
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
S&P
<S> <C> <C> <C>
BMC Industries, Manufacturing
Inc. (Diversified) S&P 500
12/31/92 $100.00 $100.00 $100.00
12/31/93 192.05 121.40 110.04
12/30/94 284.87 125.57 111.49
12/29/95 850.31 176.82 153.33
12/31/96 1,154.26 235.80 188.50
12/31/97 599.15 324.73 251.38
</TABLE>
9
<PAGE>
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table describes the cash and non-cash compensation for each of
the last three fiscal years of the Company's Chief Executive Officer, two former
executive officers and its two other executive officers whose annual salary and
bonus for 1997 exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
-------------
AWARDS
ANNUAL COMPENSATION(1) -------------
------------------------------------------ SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(2) COMPENSATION(3) OPTIONS(4) COMPENSATION(5)
- --------------------------------- --------- ----------- ----------- ---------------- ------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Paul B. Burke 1997 $ 350,000 0 $ 126,603 200,000 $ 24,288
Chairman of the Board, President 1996 350,000 $ 262,500 131,629 0 80,916
and CEO 1995 250,000 187,500 73,357 0 67,012
Michael P. Hawks 1997 101,538 0 38,901 0 1,315
Former Vice President of Finance 1996 120,000 54,000 36,149 0 23,666
and Administration, Chief 1995 109,538 45,369 26,043 40,000 25,194
Financial Officer and
Secretary(6)
John L. Gburek, 1997 130,288 0 26,354 25,000 8,231
Former Vice President of 1996 115,000 60,383 34,961 0 22,945
Corporate Development(7) 1995 114,789 60,143 5,768 0 27,333
William A. Guernsey 1997 203,892 0 34,399 10,000 10,013
Senior Vice President of 1996 -- -- -- -- --
Corporate Development(8) 1995 -- -- -- -- --
Ray B. Rogers 1997 130,000 0 34,153 20,000 9,163
Chief Financial Officer 1996 -- -- -- -- --
1995 -- -- -- -- --
</TABLE>
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(1) Annual compensation (including compensation deferred at the election of the
named executive officer pursuant to qualified benefit plans) is included in
the appropriate category in the year earned. Messrs. Guernsey and Rogers
were not executive officers during the years 1996 and 1995 and, accordingly,
no information is given with respect to their compensation for those years.
(2) Bonuses are included in the year earned. Under the Company's management
incentive bonus plan, bonuses earned during any given fiscal year are paid
to participants in March of the following year. No bonuses were paid for
1997 since the Company did not meet its performance objectives.
(3) Includes the value of all perquisites and personal benefits provided by the
Company to the named individuals, including the use of leased automobiles,
reimbursement of club membership dues, tax preparation services, physical
examinations, supplemental health insurance and an interest rate supplement
related to the exercise of stock options or the acquisition of shares in the
open market. For the purposes of this table, the above mentioned perquisites
and benefits were valued at their incremental cost to the Company, not on
the taxable benefit derived by the named individuals. In addition, the
Company permits stock option participants, including executive officers, to
exercise stock options and pay related income taxes due through
interest-free loans from the Company, up to a maximum amount. See "Certain
Transactions" below. The value of such interest-free loans was determined by
calculating the interest imputed on such loans for the applicable year at
the applicable federal rate provided by the Code. Specific perquisites or
personal benefits exceeding 25% of the total reported for each of the named
individuals were as follows:
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(a) Mr. Burke: Leased auto, $35,258 and $45,036 for fiscal 1997 and 1996,
respectively; imputed interest on interest free loans, $80,275, $75,825,
and $44,143 for fiscal 1997, 1996 and 1995, respectively.
(b) Mr. Hawks: Leased auto, $14,353, $19,876, and $12,166 for fiscal 1997,
1996, and 1995, respectively; imputed interest on interest free loans,
$23,691, $12,093 and $8,362 for fiscal 1997, 1996 and 1995, respectively.
(c) Mr. Gburek: Leased auto, $14,392, $10,203 and $3,965 for fiscal 1997,
1996 and 1995, respectively; imputed interest on interest free loans,
$9,693, $16,033 and $4,518 for fiscal 1997, 1996 and 1995, respectively.
(d) Mr. Guernsey: Leased auto, $12,829 for fiscal 1997; imputed interest on
interest free loans, $12,188 for fiscal 1997.
(e) Mr. Rogers: Leased auto, $15,431 for fiscal 1997; imputed interest on
interest free loans, $7,713 for fiscal 1997; and stock option loan
repayment, $11,009 for fiscal 1997.
(4) The number of shares have been adjusted, where appropriate, to reflect a
two-for-one stock split in 1995.
(5) Includes contributions made and to be made by the Company to the Company's
qualified 401(k) savings plan, qualified profit sharing plan and
nonqualified benefit equalization plan on behalf of the named individuals
for services performed in fiscal 1997, as follows:
(a) Mr. Burke: Savings plan, $2,375; profit sharing plan, $7,638; benefit
equalization plan, $14,275.
(b) Mr. Hawks: Savings plan, $1,315.
(c) Mr. Gburek: Savings plan, $2,375; profit sharing plan; $5,856.
(d) Mr. Guernsey: Savings plan, $2,375; profit sharing plan, $7,638.
(e) Mr. Rogers: Savings plan, $2,375; profit sharing plan, $6,788.
(6) Mr. Hawks became Vice President of Finance and Administration, Chief
Financial Officer and Secretary in August 1995. Prior to that date, he
served as Treasurer and Secretary. He resigned from all positions with the
Company on October 31, 1997.
(7) Mr. Gburek became Vice President, Corporate Development in August 1995.
Prior to that date, he served as General Manager of Buckbee-Mears St. Paul.
Mr. Gburek served as Vice President, Corporate Development until November
1997 when he was named President, Mask Operations.
(8) Mr. Guernsey served as President, Mask Operations from July 1992 to November
1997 when he was named Senior Vice President, Corporate Development.
(9) Mr. Rogers became President of the Company's Vision-Ease Lens, Inc.
subsidiary in May 1991. He resigned from that position in April 1997 to
serve as Director, Special Projects for BMC and was appointed Chief
Financial Officer in November 1997. In January 1998, he returned to his
position as Director, Special Projects concurrent with the appointment of
Jeffrey J. Hattara as the Company's new Vice President, Finance and
Administration and Chief Financial Officer.
11
<PAGE>
STOCK OPTIONS AND EXERCISES
The following table summarizes options granted to the executive officers
named in the "Summary Compensation Table" above during 1997. Individual grants
are listed separately for each officer. In addition, this table shows the
estimated present value of each grant as of the date the option was granted.
OPTION GRANTS IN 1997(1)
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
---------------------------------------------------
NUMBER OF % OF TOTAL GRANT DATE
SECURITIES OPTIONS VALUE(2)
UNDERLYING GRANTED TO EXERCISE OR -------------
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION GRANT DATE
NAME GRANTED 1997 ($/SH) DATE PRESENT VALUE
- ------------------------ ----------- ------------- ----------- ---------- -------------
<S> <C> <C> <C> <C> <C>
Paul B. Burke 200,000 32.7% $ 27.7500 4/29/07 $ 2,610,000
Michael P. Hawks 0 -- -- -- --
John L. Gburek 10,000 1.6% 27.7500 4/29/07 130,500
15,000 2.5% 16.3125 12/23/07 115,050
William A. Guernsey 10,000 1.6% 27.7500 4/29/07 130,500
Ray B. Rogers 5,000 .8% 27.7500 4/29/07 65,250
15,000 2.5% 16.3125 12/23/07 115,050
</TABLE>
- ------------------------
(1) All options were granted under the Company's 1994 Plan. All options become
exercisable in five equal annual installments beginning one year from the
date of grant. All options were granted with an exercise price equal to the
average fair market value of the Company's Common Stock on the date of
grant.
(2) The present value determination was made using the Black-Scholes option
pricing model. The assumptions used in the model are dependent on the date
of option grant. The assumptions used included expected stock price
volatility of .466, risk-free rate of return of 5.71%, weighted average
expected life of five years, dividend yield of .30% and contractual time to
exercise of ten years. Actual gains (if any) on stock option exercises are
dependent upon the Company's future performance and the performance of its
Common Stock, overall market conditions, and the executive's continued
employment with the Company through the vesting dates of the option grant.
The following table shows options that were exercised during 1997 and the
number of shares and value of grants outstanding as of December 31, 1997 for
each of the executive officers named in the "Summary Compensation Table" above.
AGGREGATED OPTION EXERCISES IN 1997 AND OPTION VALUES AT DECEMBER 31, 1997
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS AT DECEMBER 31, IN-THE-MONEY OPTIONS
ACQUIRED ON VALUE 1997 AT DECEMBER 31, 1997
NAME EXERCISE(1) REALIZED(2) EXERCISABLE/UNEXERCISABLE(3) EXERCISABLE/UNEXERCISABLE(4)
- ------------------------ ----------- ----------- --------------------------- --------------------------
<S> <C> <C> <C> <C>
Paul B. Burke 25,000 $ 330,078 659,600/360,000 $8,853,542/$1,832,496
Michael P. Hawks 15,500 374,782 24,500/0 256,499/0
John L. Gburek 0 0 30,000/79,000 331,187/511,497
William A. Guernsey 44,000 906,249 36,000/70,000 351,185/595,497
Ray B. Rogers 22,000 568,749 18,000/62,000 175,593/389,342
</TABLE>
- ------------------------
(1) Under the 1994 Plan, the exercise price of options may be paid in cash or,
at the Compensation Committee's discretion, in shares of Common Stock valued
at fair market value on the date of exercise, or pursuant to a cashless
exercise procedure under which the executive provides irrevocable
instructions to a brokerage firm to sell the purchased shares and to remit
to the Company, out of the sale proceeds, an amount equal to the exercise
price plus all applicable withholding
12
<PAGE>
taxes. The exercise price may also be paid with an interest free loan from
the Company pursuant to the BMC Stock Option Exercise Loan Program (the "BMC
Loan Program"). See "Certain Transactions" for a more detailed description
of the BMC Loan Program.
(2) Market value of underlying securities on date of exercise, minus the
exercise price.
(3) The number of shares have been adjusted, where appropriate, to reflect
two-for-one stock splits in each of 1994 and 1995. All unexercisable options
held by Mr. Hawks were forfeited upon his termination of employment.
(4) Based on the closing price of the Common Stock on the New York Stock
Exchange--Composite Transactions at December 31, 1997 ($16.3125), minus the
exercise price.
OFFICER AGREEMENTS AND CHANGE IN CONTROL ARRANGEMENTS
Each of Messrs. Burke, Hawks, Gburek, Guernsey and Rogers have entered into
change of control agreements (the "Agreements") with the Company in the form
described immediately below.
Under the Agreements, termination of an individual executive officer's
employment with the Company in connection with any change of control triggers
severance benefits. A "change of control" includes the sale, lease or other
transfer of substantially all of the assets of the Company; a stockholder
approved dissolution or liquidation; a change of control reportable to the
Securities and Exchange Commission on Form 8-K; acquisition by any person of 50%
or more of the Company's voting stock; or, a change in composition of the
Company's Board of Directors, such that current directors cease to constitute a
majority (but only if the nominations of the newly elected members were not
approved by the current directors). Severance benefits payable under the
Agreements to Messrs. Burke and Hawks consist of three years' base salary,
payable in the form of a lump sum payment of one year's base salary and a payout
of the remainder over 24 months. Severance benefit payable under the Agreements
to Messrs. Gburek, Guernsey and Rogers consist of a lump sum payment equal to
one year's base salary. Any monthly payments under the Agreements are reduced to
the extent of any base salary received as a result of subsequent employment, but
the terminated executive officer has no duty to seek subsequent employment. In
the event the standard severance benefits constitute an excess parachute payment
under the rules of the Internal Revenue Service, severance benefits will be
reduced to an amount equal to the severance payment amount less the amount
required to avoid any excise tax. Under the Agreements, each executive officer
remains employed by the Company for a six-month period following any change of
control. During that period, he or she may resign for "good reason" and receive
contractual severance benefits. "Good reason" includes adverse changes in
compensation and/or duties, forced relocation to a new locale, or the Company's
failure to continue to provide benefit plans equivalent to those offered by the
Company prior to the change of control. At the end of the six-month period, the
executive has a 30-day period in which to decide whether to remain employed by
the successor; during that period, the executive may elect to terminate
employment, with or without good reason, and receive contractual severance
benefits. Any termination by the successor during the above periods without good
cause, or by the Company prior to a change in control at the insistence of an
acquiror, also triggers severance benefits. "Good cause" includes (i) willful
and continued failure to perform duties or (ii) conviction of a felony or gross
misdemeanor materially injurious to the Company. Death or attainment of age 65
prior to the end of the period during which monthly payments are made ends all
further obligations of the Company.
To the extent not already exercisable, options also become immediately
exercisable under the 1994 Plan in the event of any "change in control." For
purposes of the 1994 Plan, a "change in control" of the Company means the
following: (a) the sale or other transfer of substantially all of the assets of
the Company; (b) the liquidation or dissolution of the Company; (c) a merger or
consolidation involving the Company if (i) less than 50% of the voting stock of
the surviving company is held by persons who were stockholders of the Company
immediately before the merger or consolidation, or (ii) less than 80% of the
voting stock of the surviving company is held by persons who were stockholders
of the Company immediately prior to the merger or consolidation without the
prior approval of the continuity directors of the Company (directors as of
December 10, 1993 and additional directors nominated or elected by a majority of
the "continuity directors"); (d) ownership by any person or
13
<PAGE>
group of 50% or more of the Company's voting stock, or 20% or more of the
Company's voting stock without the prior approval of the continuity directors;
(e) the continuity directors ceasing to constitute a majority of the Board; or
(f) any change of control that is required to be reported on Form 8-K.
Under the Company's 1984 Omnibus Stock Program, which terminated pursuant to
its terms on January 10, 1994, if any person makes a successful tender or
exchange offer for the Common Stock of the Company that the Board opposes or
does not affirmatively recommend, then (i) all incentive stock options, and
non-qualified options with respect to which no stock appreciation rights have
been granted, will become immediately exercisable, (ii) all non-qualified
options with respect to which stock appreciation rights have been granted and
which have been outstanding for at least six months, will become immediately
exercisable, provided that exercise may only take place during certain periods
following the public release of certain financial reports by the Company and
(iii) all restrictions on any outstanding restricted stock awards will
immediately lapse.
To the extent not already vested, all benefits under the Company's Profit
Sharing Plan 1994 Revision (the "Profit Sharing Plan") and Savings Plan 1994
Revision (the "Savings Plan") become fully vested in the event of any "change in
control." For purposes of the Profit Sharing Plan and Savings Plan, a change in
control of the Company means the following: (a) the sale or other transfer of
substantially all of the assets of the Company; (b) the liquidation or
dissolution of the Company; (c) a person becomes the beneficial owner of 50
percent or more of the voting power of the outstanding securities of the
Company; (d) individuals who constitute "incumbent directors" (directors as of
January 1, 1994 and additional directors nominated or elected by a majority of
the "incumbent directors") cease to constitute at least a majority of the Board;
or (e) any change in control that is required to be reported under Section 13 or
15(d) of the Securities Exchange Act of 1934.
14
<PAGE>
CERTAIN TRANSACTIONS
Effective April 22, 1993 (and as amended on December 14, 1994), the Company
adopted the BMC Loan Program pursuant to which employees can borrow money from
the Company, generally on an interest-free basis, to exercise the Company's
stock options and to pay any related income taxes due. The shares obtained upon
exercise of the underlying stock options are held by the Company as collateral
for the loan. The purpose of the BMC Loan Program is to facilitate the exercise
of stock options, to encourage share ownership by employees, to minimize tax
consequences to key employees, and to minimize the need to sell shares in the
open market to pay income taxes due upon the exercise of options. Approval of
the loans are subject to the sole and absolute discretion of the Committee.
The total amount that any employee may borrow under the program is
determined by the Committee but may not exceed the following: (i) for the first
loan request, 100% of the exercise price of the option, plus 100% of the state
and federal income taxes actually paid within 15 months of such exercise on any
income recognized by reason of such exercise and (ii) for any subsequent loan,
the lesser of (a) 100% of the exercise price of the option, plus 100% of the
state and federal income taxes actually paid within 15 months of such exercise
on any income recognized by reason of such exercise or (b) the amount that, when
added to the principal amount of all outstanding loans under the BMC Loan
Program, will not exceed 60% of the market value of all of the Company's stock
pledged as collateral by the employee immediately following the loan or (c)
eight times the employee's then current base salary. Notwithstanding the
foregoing criteria, no loan may be made which would cause the aggregate amount
of principal and accrued interest outstanding under all loans to an employee to
exceed 100% of the market value of all of the Company's stock pledged as
collateral by that employee under the BMC Loan Program.
The loans made to employees under the BMC Loan Program are made on an
interest-free basis with respect to all amounts advanced to pay the option
exercise price. The loans are also interest-free with respect to the amounts
advanced to pay income taxes, but only to the extent that the aggregate
principal amount attributable to tax payments is not greater than two times the
employee's base annual compensation plus target bonus (the "Interest Free Loan
Amount"). The applicable interest rate for the amounts in excess of the Interest
Free Loan Amount is the rate applicable under any short-term borrowings by the
Company or, if the Company has no such borrowings, the interest rate payable to
the Company under its short-term money market investments. Upon termination of
the employee's employment, the loan must be repaid within 45 days or such longer
period as the Committee may determine. Upon the death or long term disability of
the employee, the Committee may extend the term of the repayment of the loan up
to six months. Notwithstanding the above, the Committee may demand repayment of
the notes at any time.
Each individual borrowing arrangement is evidenced by a written demand
promissory note executed by the employee at the time of borrowing. The note
provides that thirty percent (30%) of the employee's bonus compensation received
under the Bonus Plan (net of applicable estimated taxes and other withholdings)
will be applied to repay the principal under the note. In addition, a portion of
the proceeds from any sale of the Company's stock pledged under the BMC Loan
Program must be applied to the repayment of amounts outstanding under the BMC
Loan Program. All dividends received by an employee for BMC stock pledged for a
loan, net of applicable estimated taxes and other withholdings on such
dividends, are also applied to the loan.
The amount outstanding under the BMC Loan Program for Messrs. Burke, Hawks,
Guernsey and Rogers as of March 13, 1998 was $1,663,435, $442,790, $431,143 and
$254,404, respectively. The largest loan amount outstanding for Messrs. Burke,
Hawks, Gburek, Guernsey and Rogers during 1997 was $1,664,765, $451,659,
$585,196, $431,581 and $259,231, respectively.
15
<PAGE>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and executive officers, and persons who beneficially own
more than 10% of the Company's Common Stock, to file with the Securities and
Exchange Commission (the "SEC") initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of the Company.
Directors, executive officers and greater than 10% stockholders are required by
SEC regulations to furnish the Company with copies of all Section 16(a) reports
they file. To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company with respect to the period ended December
31, 1997, all Section 16(a) filing requirements applicable to its directors,
executive officers and greater than 10% stockholders were complied with.
INDEPENDENT AUDITORS
During 1997, in addition to auditing the Company's financial statements,
Ernst & Young LLP performed services in connection with preparation of the
Company's tax returns and related tax planning, audits of employee benefit plans
of the Company and its operating units and provision of general accounting
advice.
Ernst & Young LLP, or its predecessor, has been the Company's independent
auditors since 1980 and has been selected by the Board to continue as such for
the current fiscal year. The Company has requested and expects a representative
of Ernst & Young LLP to be present at the Meeting, to make a statement if he or
she so desires and to respond to appropriate questions.
1999 STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented in the proxy materials
relating to the proposed 1999 Annual Meeting of Stockholders must be received by
the Company on or before November 27, 1998.
OTHER BUSINESS
The Company knows of no business which will be presented for consideration
at the Meeting other than that described in this proxy statement. As to other
business, if any, that may properly come before the Meeting, it is intended that
proxies solicited by the Board will be voted in accordance with the judgment of
the person or persons voting the proxies.
THE COMPANY WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS ANNUAL REPORT ON
FORM 10-K (EXCLUSIVE OF EXHIBITS) FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997 TO
EACH PERSON WHO IS A STOCKHOLDER OF THE COMPANY AS OF MARCH 13, 1998, UPON
RECEIPT FROM ANY SUCH PERSON OF A WRITTEN REQUEST FOR SUCH AN ANNUAL REPORT.
SUCH REQUESTS SHOULD BE SENT TO: INVESTOR RELATIONS DEPARTMENT, BMC INDUSTRIES,
INC., ONE MERIDIAN CROSSINGS, SUITE 850, MINNEAPOLIS, MN 55423.
Dated: March 31, 1998
BMC Industries, Inc.
One Meridian Crossings, Suite 850
Minneapolis, Minnesota 55423
16
<PAGE>
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS.
The undersigned hereby appoint(s) Jeffrey J.
Hattara, and Jeffrey L. Wright, and each of them,
as Proxies, each with the power to appoint his
substitute, and hereby authorizes each of them to
represent and to vote, as designated below, all
the shares of common stock of BMC Industries,
[LOGO] Inc. held of record by the undersigned on March
13, 1998, at the Annual Meeting of Stockholders
One Meridian Crossings to be held on May 8, 1998, or any adjournment
Minneapolis, Minnesota 55423 thereof.
- ----------------------------
1. ELECTION OF DIRECTORS FOR all nominees listed AGAINST all nominees
below / / listed below / /
(except as marked to the
contrary below)
(INSTRUCTION: TO VOTE AGAINST ANY INDIVIDUAL NOMINEE(S), STRIKE A LINE THROUGH
HIS NAME ON THE LIST)
Lyle D. Altman Paul B. Burke Harry A.
Hammerly
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
The Board of Directors Recommends a Vote FOR Proposal 1 Above.
(PLEASE SIGN ON REVERSE SIDE.)
<PAGE>
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER(S). IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR ALL NOMINEES NAMED IN PROPOSAL 1 ABOVE.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
- --------------------------------------------------------------------------------
Dated: ______________, 1998.
____________________________
Print name(s) of
stockholder(s)
____________________________
Signature
____________________________
Signature if held jointly
PLEASE MARK, SIGN, DATE AND
RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED
ENVELOPE, WHICH REQUIRES NO
POSTAGE IF MAILED IN THE
UNITED STATES.
