<PAGE>
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:
/X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Nuclear Metals, 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/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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:
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2) Aggregate number of securities to which transaction applies:
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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):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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/ / 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
NUCLEAR METALS, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY 1, 1996, 10:00 A.M.
You are hereby notified that the Annual Meeting of Stockholders of
Nuclear Metals, Inc. (the "Company") will be held on May 1, 1996 at 10:00
a.m. at the State Street Bank building, Enterprise Room, 225 Franklin Street,
Boston, Massachusetts, to consider and act upon the following matters:
l. To fix the number of directors of the Company at five (5) and to elect
five (5) directors for the ensuing year.
2. To amend Article III of the Company's Articles of Organization to provide
that the Company shall have authority to issue one million (1,000,000) shares
of Preferred Stock.
3. To approve the adoption by the Board of Directors of the Directors' Stock
Option Plan.
4. To ratify the action of the Board of Directors in appointing Arthur
Andersen LLP as auditors for the Company.
5. To transact such other business as may properly come before the meeting.
Even if you plan to attend the meeting, please be sure to sign, date and
return the enclosed proxy in the enclosed envelope to:
Boston EquiServe
P. O. Box 8200
Boston, MA 02266-5523
Attention: Philip Weiner
Only stockholders of record on the books of the Company at the close of
business on March 11, 1996 will be entitled to receive notice of and vote at
this meeting.
By order of the Board of Directors,
THOMAS A. WOOTERS, Clerk
March 29, 1996
IMPORTANT
IN ORDER TO SECURE A QUORUM AND TO AVOID THE EXPENSE OF SENDING FOLLOW-UP
LETTERS, PLEASE MAIL YOUR PROXY PROMPTLY IN THE ENCLOSED ENVELOPE. YOUR
COOPERATION IS GREATLY APPRECIATED.
<PAGE>
NUCLEAR METALS, INC.
2229 MAIN STREET
CONCORD, MA 01742
PROXY STATEMENT
SOLICITATION AND VOTING OF PROXIES
This proxy statement and the accompanying proxy card are being mailed to
common stockholders commencing on or about March 29, 1996. The accompanying
proxy is solicited by the Board of Directors of Nuclear Metals, Inc.
(hereinafter called the "Company") for use at the Annual Meeting of
Stockholders to be held on May 1, 1996, and any adjournment or adjournments
thereof. The cost of solicitation of proxies will be borne by the Company.
Directors, officers and a few employees may assist in the solicitation of
proxies by mail, telephone, telegraph, and personal interview without
additional compensation.
When a proxy is returned properly signed, the shares represented thereby
will be voted by the proxies named in accordance with the stockholder's
directions. You are urged to specify your choices on the enclosed proxy
card. If the proxy is signed and returned without specifying choices, the
shares will be voted "FOR" proposals 1, 2, 3 and 4 and in the discretion of
the proxies as to other matters that may properly come before the meeting.
Sending in a proxy will not affect a stockholder's right to attend the
meeting and vote in person. A proxy may be revoked by notice in writing
delivered to the Clerk at any time prior to its use or by voting in person at
the meeting. A proxy may also be revoked by a later dated proxy. A
stockholder's attendance at the meeting will not by itself revoke a proxy.
RECORD DATE AND VOTING SECURITIES
The Board of Directors has fixed March 11, 1996 as the record date for
the meeting. Only stockholders of record on the record date are entitled to
notice of and to vote at the meeting. On the record date, there were
2,392,014 shares of Common Stock, $.10 par value, of the Company issued and
outstanding, of which 1,513,384 shares are entitled to one vote per share.
The remaining 878,630 outstanding shares of Common Stock are subject to the
Massachusetts Control Share Acquisition Act and, as a result, have no voting
rights and would obtain voting rights only upon authorization from a majority
of stockholders other than the holders of such shares, officers of the
Company and those directors of the Company who are also employees. See
"Massachusetts Control Share Acquisition Act" elsewhere herein.
The Company's By-laws provide that a quorum shall consist of the
representation in person or by proxy at the annual meeting of stockholders
entitled to vote 51% of the votes that are entitled to be cast at the
meeting. Abstentions and broker non-votes will be counted for purpose of
determining the presence or absence of a quorum. "Broker non-votes" are
shares held by brokers or nominees which are present in person or represented
by proxy, but which are not voted on a particular matter because instructions
have not been received from the beneficial owner. The effect of abstentions
and broker non-votes to be brought before the Annual Meeting of Stockholders
is discussed below.
The election of directors is by plurality of the votes cast at the Annual
Meeting either in person or by proxy. The approval of a majority of the
votes properly cast at the Annual Meeting, either in person or by proxy, is
required to approve proposals 1, 2, 3 and 4 and any other business which may
properly be brought before the Annual Meeting or any adjournment thereof.
With regard to the election of directors, votes may be left blank, cast
in favor or withheld; votes that are left blank will be counted in favor of
the election of the directors named on the proxy. Votes that are withheld
will have the effect of a negative vote. Abstentions may be specified on all
proposals other than the election of directors and will be counted as present
for purposes of the proposal on which the abstention is
-2-
<PAGE>
noted. Because the proposals (i) to amend the Company's Articles of
Organization, (ii) to ratify the adoption by the Board of Directors of the
Directors' Option Plan, and (iii) to ratify the action of the Board of
Directors in appointing Arthur Andersen LLP as auditors for the Company,
require the approval of a majority of the votes properly cast at the Annual
Meeting, either in person or by proxy, abstentions will have the effect of a
negative vote. Broker non-votes will not be counted in determining a quorum
for, or the outcome of, any proposal.
The Company's Annual Report to Stockholders, including financial
statements for the fiscal year ended September 30, 1995, was mailed to
stockholders of record of the Company on March 5, 1996. Concurrent with the
distribution of this proxy statement, stockholders of record on March 11, 1996
who were not included in the distribution of the 1995 Annual Report on March 5,
1996 will receive concurrently with this proxy statement a copy of the Annual
Report. The Annual Report is not, however, a part of the proxy soliciting
materials.
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
One of the purposes of the meeting is to elect five (5) directors to
serve until the next Annual Meeting of Stockholders and until their
successors shall have been duly elected and qualified. It is intended that
the proxies solicited by the Board of Directors will be voted in favor of the
five (5) nominees named below, unless otherwise specified on the proxy card.
All of the nominees are currently members of the Board and have consented to
be named and to serve if elected. There are no family relationships between
any nominees, directors or executive officers of the Company.
The Board knows of no reason why any of the nominees will be unavailable
or unable to serve as a director, but in such event, proxies solicited hereby
will be voted for the election of another person or persons to be designated
by the Board of Directors.
The Board recommends a vote FOR the election of each of the nominees
listed below.
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<PAGE>
The following are summaries of the background and business experience and
descriptions of the principal occupations of the nominees:
<TABLE>
<CAPTION>
PRESENT PRINCIPAL EMPLOYMENT
NAME AGE AND PRIOR BUSINESS EXPERIENCE DIRECTOR SINCE
- ---- --- ----------------------------- --------------
<S> <C> <C> <C>
George J. Matthews 65 Chairman of the Board of Directors 1972
since 1972. Until July 1978 and since
December 1, 1994, also Treasurer of
the Company. Chairman of Matthews
Associates Limited, which is engaged
in the business of investing in and
providing management consulting and
assistance to small and medium sized
businesses, including the Company.
Robert E. Quinn 42 President of the Company since 1994
December 1, 1994. Prior to
becoming President, served as Vice
President, Sales for over five years.
Elected as a Director on
November 17, 1994.
Wilson B. Tuffin 64 Vice Chairman since November 1994. 1972
From 1972 to November 30, 1994, President,
Chief Executive Officer and Treasurer
of the Company.
Kenneth A. Smith 59 Professor of Chemical Engineering at 1985
Massachusetts Institute of Technology
since 1971.
Frank H. Brenton 70 Principal of Frank H. Brenton Associates 1986
a business consulting firm. From
1984 to 1986, Chairman of the Board of
Directors of Marshall's Incorporated,
an off-price retailer and division of
Melville, Inc.
</TABLE>
INFORMATION ABOUT THE BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors met six times during the fiscal year ended
September 30, 1995. There was no director who during the fiscal year
attended fewer than 75 percent of the aggregate of all board meetings and all
meetings of committees on which he served.
The Board of Directors has a two-member Audit Committee which is
reconstituted at the first meeting of the Board following the annual meeting
of stockholders. The Audit Committee, which met two times during fiscal 1995,
meets with the Company's independent auditors and principal financial
personnel to review the scope and results of the annual audit and the
Company's financial reports. The Audit Committee also reviews the scope of
audit and non-audit services performed by the independent public accounts,
reviews the independence of the independent public accountants, and reviews
the adequacy and effectiveness of internal accounting controls. The present
members of the
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<PAGE>
Audit Committee are Messrs. Brenton and Smith.
The "disinterested" directors, for purposes for Rule 16b-3 under the
Securities Exchange Act of 1934, Messrs. Brenton and Smith, acting as a Stock
Option Committee, have the authority, subject to the express provisions of
the Company's Employees' Stock Option Plan and Non-Qualified Stock Option
Plan (the "Plans"): to determine the employees of the Company to receive
options, the number of shares to be optioned, and the terms of the options
granted; to construe and interpret the Plans and outstanding options; and to
make all other determinations that they deem necessary and advisable for
administering the Plans. The Board of Directors as a whole has corresponding
authority with respect to options issued under the Directors' Stock Option
Plan.
The Board of Directors does not have standing committees on compensation
or nominations.
DIRECTORS' COMPENSATION AND STOCK OPTION PLAN
Each outside director of the Company receives an annual fee of $15,000.
On November 20, 1995, the Board of Directors adopted a Director's Stock
Option Plan (the "Plan") in order to enhance the Company's ability to attract
and retain skilled and competent members of its Board of Directors. Only
outside (non-management) directors of the Company and its subsidiaries are
eligible to receive options under the Plan, and the maximum number of shares
as to which such directors' options may be granted is 35,000 shares (subject
to adjustments for stock splits, stock dividends and the like). Pursuant to
the Plan, each director eligible to participate in the Plan, upon first
election to office at the annual meeting of stockholders and for each
subsequent period of three years of service, receives an option to purchase
1,000 shares of Common Stock of the Company at an exercise price equal to
fair market value on the date of grant. Options to purchase 4,000 shares of
Common Stock at an exercise price of $14.00 were granted to each of Messrs.
Brenton and Smith on December 15, 1994 under the Directors Stock Option
Plan which preceded the Plan. Option grants under the Plan are exercisable
for a period of ten years and vest over a three-year period.
During fiscal year 1995, Matthews Associates Limited, of which Mr.
Matthews is sole owner, received compensation from the Company in connection
with consulting services provided to the Company pursuant to a management
agreement between the Company and Matthews Associates Limited. See
"Executive Compensation" and "Executive Agreements."
-5-
<PAGE>
PRINCIPAL AND MANAGEMENT STOCKHOLDERS
The following table sets forth certain information as of March 4, 1996,
with respect to the Common Stock of the Company owned or deemed beneficially
owned as determined under the rules of the Securities and Exchange
Commission, directly or indirectly, by each stockholder known to the Company
to own beneficially more than 5% of the Company's Common Stock, by each
director, by the executive officers named in the Summary Compensation Table,
elsewhere herein, and by all directors and executive officers of the Company
and its subsidiaries as a group. In accordance with Rule 13d-3 under the
Securities Exchange Act of 1934, as amended, a person is deemed to be the
beneficial owner, for purposes of this table, of any shares of Common Stock
of the Company if he or she has or shares voting power or investment power
with respect to such security or has the right to acquire beneficial
ownership at any time within 60 days of March 4, 1996. As used herein
"voting power" is the power to vote or direct the voting of shares, and
"investment power" is the power to dispose of or direct the disposition of
shares. Except as indicated in the notes following the table below, each
person named has sole voting and investment power with respect to the shares
listed as being beneficially owned by such person.
NO. COMMON
SHARES AND
NATURE OF PERCENT OF
BENEFICIAL COMMON
NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP (1) STOCK (1)
- ------------------------------------ ------------- ----------
WIAF Investors Co.
466 Arbuckle Avenue
Lawrence, NY 11516 1,156,228(2) 50.205%
and
Melvin B. Chrein, M.D.
Meryl J. Chrein
Marshall J. Chrein
Michael Chrein
Charles Alpert
Joseph Alpert
21 Copper Beech Lane
Lawrence, NY 11559
George J. Matthews 229,617(3) 9.6%
Chairman of the Board of Directors,
Director & Consultant
c/o Matthews Associates Limited
100 Corporate Place
Peabody, MA 01960
Wilson B. Tuffin 203,808 8.5%
Vice Chairman and Director
23 Arlington Street
Acton, MA 01720
Robert E. Quinn 14,406(4) *
President and Director
Kenneth A. Smith, Director 4,333(5) *
Frank H. Brenton, Director 4,333(6) *
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<PAGE>
James M. Spiezio 3,000(7) *
Vice President, Finance and Administration
William T. Nachtrab 3,000(8) *
Vice President, Technology
All directors and executive officers as a 462,497(9) 19.0%
group (7 persons)
________________________
*Less than one percent
(1) Does not reflect the effect on voting rights of the Massachusetts Control
Share Acquisition Act.
(2) Derived from Schedules 13DA, dated October 3, 1994, submitted to the
Company. The five persons named are described as a group in such
Schedules 13DA. The persons named reported ownership of the following
shares: WIAF Investors Co. (862,428); Melvin B. Chrein (88,400); Meryl J.
Chrein (128,100); Charles Alpert (25,000) and Marshall J. Chrein
(18,200). Each person reported sole voting and dispositive power with
respect to the shares owned by such person.
(3) Includes 25,445 shares owned by a trust established by his late wife of
which Mr. Matthews is a permitted beneficiary.
(4) Includes 3,333 shares which may be purchased upon the exercise of
options.
(5) Includes 1,333 shares which may be purchased upon the exercise of
options.
(6) Includes 1,333 shares which may be purchased upon the exercise of
options.
(7) Includes 2,000 shares which may be purchased upon the exercise of
options.
(8) Includes 2,000 shares which may be purchased upon the exercise of
options.
(9) See notes (3), (4), (5), (6), (7) and (8) above.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires directors, executive officers and stockholders who own more than 10%
of the outstanding common stock of the Company to file with the Securities
and Exchange Commission and NASDAQ reports of ownership and changes in
ownership of voting securities of the Company and to furnish copies of such
reports to the Company. To the Company's knowledge, based solely on review
of the copies of such reports furnished to the Company, during the fiscal
year ended September 30, 1995 or written representations in certain cases,
all Section 16(a) filing requirements were complied with except that one
report was not timely filed.
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<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table and notes present the compensation provided by the
Company during the last three fiscal years to its chief executive officer and
the four most highly compensated executive officers of the Company (other
than the chief executive officer) who were serving as executive officers at
the Company's fiscal year end of September 30, 1995.
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
----------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
--------------------------------- ------------------------ -------
OTHER RESTRICTED SECURITIES
ANNUAL STOCK UNDERLYING LTIP ALL OTHER
NAME AND COMPEN- AWARD(S) OPTIONS/ PAYOUTS COMPEN-
PRINCIPAL POSITION YEAR(1) SALARY($) BONUS($) SATION($)(2) $ SARS (#) $ SATION($)
- ------------------ ------- --------- -------- ------------ --------- ----------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert E. Quinn 1995 151,673 200 35,000 --- 30,000 --- ---
President 1994 131,000 --- --- --- --- --- ---
1993 131,000 --- --- --- --- --- ---
George J. Matthews(3) 1995 350,000 --- --- --- --- --- ---
Chairman of Board of 1994 350,000 --- --- --- --- --- ---
Directors, CEO and 1993 350,000 --- --- --- --- --- ---
Treasurer
Wilson B. Tuffin(4) 1995 172,039 3,800 --- --- --- --- ---
Vice Chairman of the 1994 210,000 --- --- --- --- --- ---
Board of Directors 1993 210,000 --- --- --- --- --- ---
and Consultant
James M. Spiezio 1995 113,270 10,830 --- --- 6,000 --- ---
Vice President, 1994 105,987 --- --- --- 2,500 --- ---
Finance & 1993 89,780 --- --- --- --- --- ---
Administration
William T. Nachtrab 1995 103,703 10,830 --- --- 6,000 --- ---
Vice President, 1994 103,558 --- --- --- 2,500 --- ---
Technology 1993 103,558 --- --- --- --- --- ---
</TABLE>
(1) The Company's fiscal year ends on September 30th of each year.
(2) Excludes perquisites in amounts less than the threshold level required
for reporting.
(3) Mr. Matthews is assigned as a consultant to the Company pursuant to a
management agreement between Matthews Associates Limited and the Company.
All compensation under the agreement is paid by the Company to Matthews
Associates Limited. See "Executive Agreements - Management Agreement with
Matthews Associates Limited."
(4) Mr. Tuffin's compensation for the fiscal year ended September 30, 1995
was determined pursuant to his Employment and Consulting Agreement. See
"Executive Agreements - Employment Agreement with Mr. Tuffin."
-8-
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table shows all options granted to each of the named
executive officers of the Company during the fiscal year ended September 30,
1995 and the potential value of stock price appreciation rates, 5% and 10%,
over the ten year term of the options. The 5% and 10% rates of appreciation
are not intended to forecast future actual appreciation, if any, in the
Company's stock prices. The Company did not use an alternative present value
formula because the Company is not aware of any such formula that can
determine with reasonable accuracy the present value based on future unknown
or volatile factors.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT ASSUMED
ANNUAL RATES OF STOCK PRICE
APPRECIATION FOR OPTION TERM (5)
-------------------------------------
INDIVIDUAL GRANTS
-----------------
NUMBER OF % OF TOTAL
SECURITIES OPTION/SARS
UNDERLYING GRANTED TO EXERCISE OR
OPTION/SARS EMPLOYEES IN BASE PRICE
NAME GRANTED (#) FISCAL YEAR ($/SH) (4) EXP. DATE 5%($) 10%($)
- ---- ------------ ------------ ------------ --------- ----- -------
<S> <C> <C> <C> <C> <C> <C>
Robert E. Quinn 10,000(1) 13.50 11/16/2004 84,900 215,155
20,000(2) 36% 12.25 08/01/2005 183,923 390,467
George J. Matthews 10,000(2) 12% 12.25 08/01/2005 77,040 195,233
Wilson B. Tuffin 5,000(2) 6% 12.25 08/01/2005 38,520 97,616
James M. Spiezio 1,000(3) 14.00 12/14/2004 9,805 22,313
5,000(2) 7% 12.25 08/01/2005 38,520 97,616
William T. Nachtrab 1,000(3) 14.00 12/14/2004 8,805 22,312
5,000(2) 7% 12.25 08/01/2005 38,520 97,616
</TABLE>
(1) These options were first exercisable on November 16, 1995 at which time
the options were 33% vested with options vesting in additional 33%
increments in two annual installments commencing on November 16, 1996.
(2) These options are first exercisable on August 1, 1996 at which time the
options will be 33% vested with options vesting in additional 33%
increments in two annual installments commencing on August 1, 1997.
(3) These options were first exercisable on December 14, 1995 at which time
the options were 33% vested with options vesting in additional 33%
increments in two annual installments commencing on December 14, 1996.
(4) The exercise price per share is the market price of the underlying Common
Stock on the date of grant.
(5) Amounts represent hypothetical gains that could be achieved for the
respective options if exercised at the end of the option term. These
gains are based upon assumed rates of share price appreciation set by the
Securities and Exchange Commission of five percent and ten percent
compounded annually from the date the respective options were granted to
their expiration date. The gains shown are net of the option exercise
price, but do not include deductions for taxes of the options exercise
price, but do not include deductions for taxes or other expenses
associated with the exercise. Actual gains, if any, are dependent on the
performance of the Common Stock and the date on which the option is
exercised. There can be no assurance that the amounts reflected will be
achieved.
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<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table sets forth information with respect to the exercise
of options by the executive officers named in the Summary Compensation Table
during the last fiscal year and unexercised options held as of the end of the
fiscal year.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT FY-END (#) AT FY-END(2)
----------------------- --------------------
SHARES
ACQUIRED VALUE
NAME ON EXERCISE (#) REALIZED($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- --------------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Robert E. Quinn 5,000 41,250 3,333 26,667 0 25,000
1,000 6,500
George J. Matthews 26,350 155,025 0 10,000 0 12,500
2,000 15,750
500 4,500
Wilson B. Tuffin 23,850 196,763 0 5,000 0 6,250
James W. Spiezio 1,000 6,250 2,000 6,500 11,452 11,973
William T. Nachtrab 1,000 6,250 2,000 6,500 11,452 11,993
</TABLE>
(1) Value realized equals fair market value on the date of exercise, less the
exercise price, times the number of shares acquired, without deducting
taxes or commissions paid by employee.
(2) Value of unexercised options equals fair market value of the shares
underlying in-the-money options at September 30, 1995 ($13.50 per share),
less the exercise price, times the number of options outstanding.
PENSION PLAN TABLE
The following table sets forth the aggregate annual benefit payable upon
retirement at normal retirement age for each level of remuneration specified
at the listed years of service.
YEARS OF SERVICE
----------------
REMUNERATION 15 20 25 30 OR MORE
- ------------ ---- ---- ---- ----------
$100,000 23,520 31,360 39,220 47,040
150,000 38,520 51,360 64,200 77,040
200,000 53,520 71,360 89,200 107,040
300,000 83,520 111,360 139,200 167,040
400,000 113,520 151,360 189,200 227,040
500,000 143,520 191,360 239,200 287,040
The Company has a defined benefit plan (the "Pension Plan") designed to
provide retirement benefits for employees and ancillary benefits to their
beneficiaries, joint annuitants and spouses. All employees of the Company
become participants in the Pension Plan after attaining the later of age 21
or a year of service with the Company. The Pension Plan provides retirement
benefits based on years of service and compensation. An employee's benefits
under the Pension Plan generally become fully vested after five years of
service. At normal retirement (the later of age 65 and five years of Plan
participation), participants are entitled to a monthly benefit for the
remainder of their life in an amount
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<PAGE>
equal to one-twelfth of the sum of their "Annual Credits" for their last 30
years or lesser period of employment with the Company and its predecessors.
An employee's "Annual Credit" is 1.25% of the portion of his annual
compensation that is subject to Social Security tax and two percent (2%) of
the balance of his annual compensation. Participants with five years of
service are entitled to retirement at age 55, but the monthly benefit payable
under the Pension Plan is reduced by 0.5% for each month that early
retirement precedes normal retirement but not to less than $100 per month if
the Participant has ten or more years of service. The surviving spouse of a
retiree under the Plan is entitled to receive benefits equal to one-half the
amount the retiree had been receiving. Alternative benefit payments that are
equivalent to the benefit described above are also available to participants.
Benefits payable under the plan are not reduced by Socal Security payments to
the retiree. Amounts shown assume benefits commence at age 65. Benefit
amounts shown are straight-life annuities. The executive officers named in
the Summary Compensation Table have the following years of credited service
for pension plan purposes: Robert E. Quinn-20 years; Wilson B. Tuffin-22
years; James M. Spiezio-10 years; and William Nachtrab-6 years. On February
1, 1995, Mr. Tuffin began to receive benefit payments under the Pension Plan.
Mr. Matthews does not participate in the Pension Plan.
EXECUTIVE AGREEMENTS
EMPLOYMENT AGREEMENT WITH MR. TUFFIN
In November 1994, the Company entered into an employment and consulting
agreement (the "Employment and Consulting Agreement") with Mr. Tuffin.
Pursuant to the Employment and Consulting Agreement, Mr. Tuffin received
initial compensation at the annual rate of $210,000 through January 1995, and
will receive $105,000 as a consultant thereafter, subject to such annual
increases as the Board of Directors may from time to time determine. The
Employment and Consulting Agreement amends and supersedes the employment
agreement which Mr. Tuffin had previously entered into with the Company.
MANAGEMENT AGREEMENT WITH MATTHEWS ASSOCIATES LIMITED
The Company has entered into a management agreement with Matthews
Associates Limited, a Massachusetts corporation ("MAL"), of which Mr. George
J. Matthews, Director and Chairman of the Board of Directors of the Company,
is sole owner. The agreement expires on February 28, 1999, subject to
renewal thereafter from year to year. Pursuant to the agreement, Matthews
Associates Limited provides professional management services as a consultant
to the Company through a senior executive whose duties include (i) financial
management, (ii) serving, subject to election, as a director, as Chairman of
the Board of Directors and as an officer of the Company and (iii) marketing
and other advice to the Company including placement and modification of
financing and contact with major customers, suppliers and governmental
agencies. Mr. Matthews is the senior executive assigned to the Company under
the agreement. Under the management agreement, Mr. Matthews devotes
approximately 30 hours per week to the Company.
MAL was paid $350,000 by the Company in fiscal 1995 for services under
the management agreement and is to be paid a minimum of $350,000 in fiscal
1996 for all services under the agreement. The management agreement provides
that the Company may terminate the agreement if a majority of the directors
determines in good faith that the MAL representative has willfully refused to
perform any services under the management agreement or has been convicted of
a crime of moral turpitude, and in such event or in the event of termination
by MAL without "good reason" as defined therein, the obligation of the
Company to make future payments to MAL shall cease. The management agreement
may be terminated by MAL for "good reason" as defined therein. In the event
of termination by MAL for "good reason" or in the event of termination by the
Company for reasons other than those described above, the Company is
obligated to pay to MAL all of the amounts due under the agreement for the
remaining term. In the event of termination by MAL without "good reason,"
the Company is obligated to continue to make payment to MAL for one year from
the date of such termination. In the event of Mr. Matthew's death, the
management agreement automatically terminates and the Company is obligated to
continue to make payments to the estate of Mr. Matthews for the lesser of one
year from such termination or the end of the scheduled term of the agreement.
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<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the fiscal year ended September 30, 1995, the Board of Directors
of the Company was responsible for establishing executive compensation (other
than stock option compensation). Messrs. Quinn and Matthews participated in
the deliberations of the Company's Board of Directors concerning executive
officer compensation. No executive officer of the Company served as a
director or member of a compensation committee, or its equivalent, of another
entity, one of whose executive officers served as director of the Company.
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE
COMPANY'S FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, THAT MIGHT INCORPORATE FUTURE
FILINGS, INCLUDING THIS PROXY STATEMENT, IN WHOLE OR IN PART, THE FOLLOWING
REPORT ON COMPENSATION AND THE STOCK PERFORMANCE GRAPH CONTAINED ELSEWHERE
HEREIN SHALL NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH FILINGS NOR SHALL
THEY BE DEEMED TO BE SOLICITING MATERIAL OR DEEMED FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
REPORT OF THE BOARD OF DIRECTORS AND STOCK OPTION COMMITTEE
ON EXECUTIVE COMPENSATION
During the fiscal year ended September 30, 1995, the Board of Directors
of the Company was responsible for establishing and administering the
policies which govern annual compensation (other than stock option
compensation) for the Company's executive officers. The Stock Option
Committee was responsible for considering stock option compensation for the
Company's executive officers.
OVERVIEW
The Board of Directors has historically established levels of executive
compensation that provide for a base salary intended to allow the Company to
hire, motivate and retain qualified executive officers. From time to time,
the Board has also, on occasion, approved annual cash incentive bonuses based
on the Company's performance or on the performance of the executive in
question. In fiscal 1995, the Board approved cash incentive bonuses to
certain executive officers based on their performance. From time to time,
the Stock Option Committee also grants stock options to executive officers
and key employees in order to bring the stockholders' interests more sharply
into the focus of such officers and employees.
The Board of Directors establishes the annual salary and bonus of each of
the executive officers other than the Chief Executive Officer, based on the
recommendations made by the Chief Executive Officer. In determining the
recommendations for salary and bonus for each of the other executive
officers, the Chief Executive Officer considers each officer's individual
performance, attainment of individual goals and the contribution to the
overall attainment of the Company's goals.
STOCK OPTIONS AND OTHER COMPENSATION
Long term incentive compensation for executive officers consists
exclusively of stock options granted under the Company's Employees' Stock
Option Plan and Non-Qualified Stock Option Plan (the "Plans"). Executive
officers as well as other key employees of the Company participate in the
Plans. During fiscal 1995, the Stock Option Committee granted options only
to certain newly appointed executive officers and those executive officers
whose duties and responsibilities had increased since the prior fiscal year
as a result of promotions or departmental restructuring. The Company also
believes that its Pension Plan is an attractive feature for all employees.
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BASIS FOR THE COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
The compensation of Mr. Matthews, the Company's Chief Executive Officer
during fiscal 1995, was determined pursuant to a management agreement between
Matthews Associates Limited and the Company. All compensation under the
agreement is paid by the Company to Matthews Associates Limited. See
"Executive Agreements - Management Agreement with Matthews Associates
Limited."
THE BOARD OF DIRECTORS
George J. Matthews
Robert E. Quinn
Wilson B. Tuffin
Kenneth A. Smith
Frank H. Brenton
STOCK OPTION COMMITTEE
Kenneth A. Smith
Frank H. Brenton
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
Set forth below is a line graph comparing the five-year cumulative total
return of the Company's Common Stock against the cumulative total return of
the NASDAQ Stock Market (U.S.) Index and the Dow Jones Aerospace and Defense
Index. Cumulative total return is measured assuming an initial investment of
$100 and reinvestment of dividends.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG NUCLEAR METALS, INC., THE NASDAQ STOCK MARKET-US INDEX
AND THE DOW JONES AEROSPACE & DEFENSE INDEX
<TABLE>
<CAPTION>
9/90 9/91 9/92 9/93 9/94 9/95
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
NUCLEAR METALS, INC. 100 90 85 93 296 171
NASDAQ STOCK MARKET-US 100 157 176 231 233 321
DOW JONES AEROSPACE & DEFENSE 100 134 124 170 200 319
</TABLE>
* $100 INVESTED ON 09/30/90 IN STOCK OR INDEX - INCLUDING REINVESTMENT OF
DIVIDENDS. FISCAL YEAR ENDING SEPTEMBER 30.
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PROPOSAL NO. 2 - AUTHORIZATION OF 1,000,000 SHARES OF PREFERRED STOCK
By written consent dated March 4, 1996, the Board of Directors of the
Company approved an amendment to the Company's Articles of Organization to
authorize the issuance of up to one million (1,000,000) shares of Preferred
Stock of the Company, $.10 par value per share. The Board of Directors
believes this amendment is necessary to provide the Company with the
flexibility to effect future equity financings within institutional and other
investors who may wish to purchase senior equity securities. The Company
believes that the ability to issue equity securities which are senior to its
common stock may permit it to avoid debt offerings as a means of raising funds.
Although the Company has no present intention of issuing any shares of
Preferred Stock, the issuance of shares of Preferred Stock may result in
dilution to the Company's then existing stockholders. The terms of the
Preferred Stock to be authorized, including dividend or interest rates,
conversion prices, voting rights, redemptions, preferences and similar
matters that could adversely affect the voting power or other rights of the
holders of the Company's Common Stock will be determined by the Board of
Directors of the Company at the time an offering thereof is contemplated,
without further stockholder approval unless otherwise prescribed by the law
or the rules of any applicable exchanges. In the event of issuance, the
Preferred Stock could be utilized, under certain circumstances, as a method
of discouraging, delaying or preventing a change in control of the Company.
The Board of Directors is not presently aware of any specific efforts to
obtain control of the Company.
The authorized capital stock of the Company currently consists of
3,000,000 shares of Common Stock, $0.10 par value. Holders of Common
Stock are entitled to one vote for each share held on all matters submitted
to a vote of the stockholders. Accordingly, holders of a majority of the
shares of Common Stock entitled to vote in any election of directors may
elect all of the directors standing for election. The Restated Articles of
Organization and By-laws of the Company do not grant the holders of Common
Stock any preemptive rights or the right to accumulate votes for the election
of directors. Holders of Common Stock have no preemptive, subscription or
conversion rights. Holders of Common Stock are entitled to receive dividends
when, as and if they are declared by the Board of Directors out of funds
legally available therefor, subject to any preferential dividend rights of, and
any sinking fund or redemption or purchase rights with respect to, any shares
of Preferred Stock which may be issued and outstanding from time to time. In
the event of voluntary or involuntary liquidation, distribution, dissolution or
winding up of the Company, the holders of Common Stock shall be entitled to
receive all of the remaining assets of the Company, ratably and in proportion
to the shares of Common Stock held by them, available after distribution in full
of preferential amounts, if any, to be distributed to holders of Preferred
Stock. The rights, preferences and privileges of holders of Common Stock will
be subject to, and may be adversely affected by, the rights of holders of shares
of the Company's Preferred Stock, if authorized.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR IF THE PROPOSAL TO RATIFY
AND APPROVE THE AMENDMENT TO THE COMPANY'S ARTICLES OF ORGANIZATION TO
AUTHORIZE THE ISSUANCE OF UP TO 1,000,000 SHARES OF PREFERRED STOCK.
PROPOSAL NO. 3 - APPROVAL OF DIRECTORS' STOCK OPTION PLAN
On November 20, 1995, the Board of Directors adopted a Director's Stock
Option Plan (the "Plan") in order to enhance the Company's ability to attract
and retain skilled and competent members of its Board of Directors. The Plan
was adopted by the Board of Directors to replace the Company's prior
Directors' Stock Option Plan which expired on August 31, 1995. Only outside
(non-management) directors of the Company and its subsidiaries are eligible
to receive options under the Plan, which currently consists of three
individuals, and the maximum number of shares as to which such directors'
options may be granted is 35,000 shares (subject to adjustments for stock
splits, stock dividends and the like). Pursuant to the Plan, each director
eligible to participate in the Plan, upon first election to office at the
annual meeting of stockholders and for each subsequent period of three years
of service, receives an option to purchase 1,000 shares of Common Stock of the
Company at an exercise price equal to fair market value on the date of grant.
The Plan will be administered by a Stock Option Committee (the
"Committee") selected from time to time by the Board of Directors and
initially consisting of the entire Board of Directors of the Corporation.
Subject to the express
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<PAGE>
provisions of the Plan, the Committee shall supervise and administer the Plan
and grant all options hereunder.
The Plan became effective on November 20, 1995 and shall terminate on
November 20, 2000 unless sooner terminated by the Board of Directors.
Options may be granted under the Plan at any time and from time to time prior
to its termination. Any option outstanding under the Plan at the time of the
termination or a suspension of the Plan shall remain in effect until such
option shall have been exercised or shall have expired in accordance with its
terms and conditions.
Options granted under the Plan are exercisable for a period of ten years
and vest over a three-year period. There is currently no way to determine
either (i) the likely participation of individuals in the Plan, or (ii) the
amounts that will be received or allocated to such individuals under the Plan.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL TO
RATIFY THE ADOPTION OF THE DIRECTORS' STOCK OPTION PLAN.
PROPOSAL NO. 4 - RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors of the Company has appointed Arthur Andersen LLP
as auditors of the Company for the fiscal year ending September 30, 1996 and
has further directed that management submit the selection of auditors for
ratification by the stockholders. Arthur Andersen LLP were the Company's
auditors for the fiscal year ended September 30, 1995.
Representatives of Arthur Andersen LLP are expected to be present at the
meeting, with the opportunity to make a statement if they desire to do so,
and are expected to be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL TO
RATIFY THE CHOICE OF ARTHUR ANDERSEN LLP AS THE COMPANY'S AUDITORS.
MASSACHUSETTS CONTROL SHARE ACQUISITION ACT
The Company is subject to Chapter 110D of the Massachusetts General Laws
which governs "control share acquisitions," which are acquisitions of
beneficial ownership of shares which would raise the voting power of the
acquiring person(1) above any one of three thresholds: one-fifth, one-third or
one-half of the total voting power. Each
____________________________
(1) Under Chapter 110D, the term "person" includes any "associate" of such
person. An "associate" is defined to include: (a) a person who is in direct
or indirect control relationship with the person; (b) any corporation or
organization in which the person is an officer, director or partner or
performs a similar function; (c) a beneficial owner of ten percent (10%) or
more of any class of equity securities of the person; (d) any trust or estate
in which the person has a beneficial interest not represented by transferable
shares or as to which the person serves as a trustee or in a similar
fiduciary capacity; or (e) any relative or spouse of the person (or relative
of the person's spouse) having the same residence as the person. "Beneficial
ownership" is defined as "the sole or shared power to dispose or direct the
disposition of shares or the sole or shared power to vote or direct the
voting of shares, whether such power is direct or indirect or through any
contract, arrangement, understanding, relationship or otherwise."
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<PAGE>
time one of these thresholds is crossed, all shares acquired by the person
making the control share acquisition within 90 days before or after such
threshold is crossed, obtain voting rights only upon the authorization from a
majority of the stockholders other than the person acquiring such shares,
officers of the Company and those directors of the Company who also are
employees.
Based on certain filings made with the SEC on Schedule 13D and certain
amendments thereto, the Company believes that certain control share
acquisitions have occurred and that the members of the group which effected
such control share acquisitions, namely Wiaf Investors Co., Charles Alpert,
Joseph Alpert, Melvin B. Chrein, Meryl J. Chrein, and Marshall J. Chrein
(collectively the "Investor Group") are the holders of 878,630 shares (the
"Affected Shares") which were acquired in control share acquisitions (within
the meaning of Chapter 110D) and accordingly will have no voting rights
unless or until such voting rights are authorized as described above. The
members of the Investor Group are authorized to deliver to the Company a
control share acquisition statement in accordance with the provisions of
Section 3 of Chapter 110D and to demand that the Board of Directors of the
Company call a special meeting for the purpose of considering whether voting
rights shall be authorized for the Affected Shares. No control share
acquisition statement has been delivered to the Company and no such demand
has been made. Accordingly, the Company has not called such a special meeting
and the question of authorization of voting rights for the Affected Shares
will not be considered at the Annual Meeting.
Pursuant to Section 7 of Chapter 110D, if the question of voting rights
for the Affected Shares is, at some later date, presented to the Company's
stockholders for their consideration, if voting rights are authorized for the
Affected Shares and it is determined that the person making a control share
acquisition has acquired beneficial ownership of shares that, when added to
all other shares of the Company beneficially owned by such person, entitles
such person to vote, or direct voting of, shares of the Company having a
majority or more of all voting power in the election of directors, each
stockholder of record of the Company other than the person making such
control share acquisition, who does not vote in favor of authorizing voting
rights for the shares acquired in such control share acquisition may demand
payment for his stock in an appraisal in accordance with the provisions of
Section 86 to 98, inclusive, of Chapter 156B of the Massachusetts General
Laws. Such appraisal rights would only become operative in the event that the
members of the Investor Group were to demand that the stockholders consider
authorization of voting rights for the Affected Shares and such authorization
were granted. At this time, because no control share acquisition statement
has been delivered to the Company, the Company has not determined whether a
control share acquisition has occurred which might result in such appraisal
rights being available as described above; however, the members of the
Investor Group have made filings with the SEC which indicate collective
beneficial ownership of 37% of the Company's outstanding shares.
The Company's stockholders, at a duly-constituted meeting, may also, by
amendment to the by-laws or the Articles of Organization, provide that the
provisions of Chapter 110D shall not apply to future control share
acquisitions of the Company. Management currently has no plans to propose
such an amendment.
FINANCIAL STATEMENTS
The Annual Report of the Company, including financial statements of the
Company for the fiscal year ended September 30, 1995, was mailed to
stockholders of record of the Company on March 5, 1996. Concurrent with the
distribution of this proxy statement, stockholders of the record on March 11,
1996 who were not included in the distribution of the Annual Report on March 5,
1996 will receive concurrently with this proxy statement a copy of the Annual
Report.
STOCKHOLDER PROPOSALS FOR THE 1997 ANNUAL MEETING
Any stockholder desiring to present a proposal for consideration at the
Company's 1997 annual meeting of stockholders, scheduled to be held on or
about February 5, 1997, and included in the Company's proxy statement, must
submit the proposal to the Company so that it is received at the executive
offices of the Company not later than September 6, 1996. Any stockholder
desiring to submit a proposal should consult applicable regulations of the
Securities and Exchange Commission.
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<PAGE>
OTHER MATTERS
As of the date of this proxy statement, management of the Company knows
of no matter not specifically referred to above as to which any action is
expected to be taken at the meeting of stockholders. It is intended, however,
that the persons named as proxies will vote the proxies, insofar as the same
are not instructed to the contrary, in regard to such other matters and the
transaction of such other business as may properly be brought before the
meeting, as seems to them to be in the best interests of the Company and its
stockholders.
FORM 10-K AVAILABLE
THE ANNUAL REPORT OF THE COMPANY FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION ON FORM 10-K, WHICH INCLUDES CONSOLIDATED FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULES FOR THE COMPANY AND ITS SUBSIDIARIES, IS
AVAILABLE TO STOCKHOLDERS WITHOUT CHARGE UPON WRITTEN REQUEST TO THE VICE
PRESIDENT/FINANCE AND ADMINISTRATION OF THE COMPANY AT 2229 MAIN STREET,
CONCORD, MASSACHUSETTS 01742.
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<PAGE>
APPENDIX A
NUCLEAR METALS, INC.
DIRECTORS' STOCK OPTION PLAN
The Nuclear Metals, Inc. Directors' Stock Option Plan as adopted November
20, 1995:
1. PURPOSE AND ELIGIBILITY
The purpose of this Plan is to enhance the ability of NUCLEAR METALS,
INC. (the "Corporation") to attract and retain skilled and competent members
of its Board of Directors. The class of persons eligible to receive options
under the Plan shall consist of all outside (non-management) directors of the
Corporation and its subsidiaries.
2. MAXIMUM NUMBER OF SHARES TO BE OPTIONED
The maximum number of shares of common stock which may be optioned and
sold under this Plan is 35,000 shares of common stock of the Corporation (the
"Common Stock"), except as such number of shares shall be adjusted in
accordance with provisions of Section 5 hereof. Such shares shall be shares
of the authorized but unissued common stock or shares of Common Stock
purchased as treasury stock as may from time to time be determined by the
Board of Directors of the Corporation. Any shares which are reserved for
issuance upon the exercise of an option and which for any reason are not so
issued may after the expiration of the option, again be optioned under this
Plan.
3. ADMINISTRATION OF THE PLAN
This Plan shall be administered by a Stock Option Committee (the
"Committee") selected from time to time by the Board of Directors and
initially consisting of the entire Board of Directors of the Corporation.
Subject to the express provisions of this Plan, the Committee shall supervise
and administer this Plan and grant all options hereunder. The Committee
shall have full authority, consistently with this Plan from time to time to
determine the directors of the Corporation to receive options under this
Plan, the number of shares to be subject to each option, and the time or
times when each option may be exercised in whole or in part; to determine the
provisions of options to be granted (which need not be identical); to
construe and interpret this Plan and such options; and to make all other
determinations which it may deem necessary and advisable for administering
this Plan. All such actions and determinations of the Committee shall be
final, conclusive and binding upon all parties interested.
No member of the Committee shall be liable for any action or
determination made by him in good faith.
4. TERMS AND CONDITIONS OF OPTIONS
Options granted under this Plan shall be evidenced by written agreements
subject to the following terms and conditions and not inconsistent therewith
as the Committee shall from time to time determine.
(a) OPTION PRICE
The Committee shall determine the purchase price under each option,
provided that (i) the purchase price under each option shall not be less than
one hundred (100%) percent and not more than one hundred and twenty-five
(125%) percent of the fair market value of the common stock on the date the
option is granted, (ii) the fair market value shall be determined by the
Committee (provisions are made in Section 5 for adjustment of the price in
certain events).
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(b) PERIOD OF OPTIONS
The period during which an option may be exercised shall be determined by
the Committee, but shall be for a period of not more than ten years from the
date such option is granted. Such period may be reduced only as specifically
provided in this Plan.
(c) EXERCISE OF OPTIONS
Each option may provide that it may not be exercised for a specific
period after the date of the granting of the option as the Stock Option
Committee in each case may determine. Shares which may be purchased in any
one year and are not purchased in full may be purchased in any subsequent
year during the period of the option.
(d) PAYMENT FOR AND DELIVERY OF STOCK
Payment for shares purchased upon exercise of an option shall be made in
full in cash, or in common stock of the Corporation, valued at fair market
value on the date of exercise. Certificates for fully paid shares shall be
issued in the name of the optionee as the Corporation from time to time
receives payment in full for the purpose price thereof.
The Corporation shall not be obligated to deliver any shares of stock
until there has been compliance with any federal or State laws or regulations
which the Corporation may deem applicable.
No holder of any option or his legal representatives, legatees or
distributees, as the case may be, will be, or will be deemed to be a holder
of any shares subject to an option unless and until certificates for such
shares are issued to him or them under the provisions of this Plan.
(e) NON-TRANSFERABILITY OF OPTIONS
No option under the Plan shall be transferable, and except as otherwise
provided herein, options shall be exercisable only by the optionee. No
option shall be subject to execution, attachment or similar process.
(f) PURCHASE FOR INVESTMENT
At the time each option is exercised, the optionee shall represent in
writing to the Corporation that he is of full age and that stock purchased by
him under the option is to be and is being purchased for investment and not
with a view to the distribution thereof.
(h) EFFECT OF DEATH
If an optionee dies at a time when he is entitled to exercise an option,
then at any time or times within twelve months after his death, but in no
event after ten years from the date such option is granted, such option may
be exercised, as to all or any of the shares which the optionee was entitled
to purchase and had not purchased at the time of his death, by his executor
or administrator or the person or persons to whom the option is transferred
by will or the applicable laws of descent and distribution, and except as so
exercised such option shall expire at the end of such twelve months or at the
end of such ten years, whichever is earlier, provided however, any such
exercise of such an option shall be expressly subject to any restrictions on
transfer of stock of the Corporation found in the Articles of Organization
and the executor, administrator or person or persons so exercising said
option shall be required to comply with any restrictions on transfer of stock
of the Corporation in the same manner as if the optionee had died owning
stock of the Corporation.
5. ADJUSTMENT IN NUMBER OF SHARES AND PURCHASE PRICE
The aggregate number of shares of common stock on which options may be
granted hereunder, the number of shares of common stock covered by each such
option, shall all be appropriately and equitably adjusted by the Board of
Directors in it discretion to prevent dilution or any enlargement of rights
under such option, by reason of any increase or
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<PAGE>
decrease in the number of issued shares of common stock resulting from a
subdivision or consolidation of shares or capital readjustment, or the
payment of a stock dividend or other increase or decrease in such shares
effected without receipt of compensation by the Corporation. Any fractional
shares resulting from any such adjustment shall be eliminated from the option.
Subject to any required action by the stockholders, if the Corporation
shall be the surviving corporation in any merger or consolidation, any option
granted hereunder shall cover the securities to which a holder of the number
of shares of common stock covered by the option would have been entitled; but
a sale of substantially all the assets of the Corporation, or a dissolution
or liquidation of the Corporation, or a merger or consolidation in which the
Corporation is not the surviving corporation, shall cause (i) all outstanding
options hereunder to become exercisable in full effective as of the date of
such sale, dissolution, liquidation, merger or consolidation, and (ii) all
outstanding options hereunder immediately thereafter to terminate.
6. AMENDMENT AND TERMINATION
The Board of Directors may at any time amend, suspend or terminate this
Plan. No action by the Board of Directors may, except as provided in Section
5, without the consent of the holder of an existing option, materially and
adversely affect his rights under such option.
7. DURATION OF THE PLAN
This Plan became effective on November 20, 1995 and shall terminate on
November 20, 2000 unless sooner terminated by the Board of Directors.
Options may be granted under this Plan at any time and from time to time
prior to its termination. Any option outstanding under this Plan at the time
of the termination or a suspension of this Plan shall remain in effect until
such option shall have been exercised or shall have expired in accordance
with its terms and conditions.
DATED: November 20, 1995
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<PAGE>
APPENDIX B
NUCLEAR METALS, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints George J. Matthews and Robert E. Quinn, or
either or them, as Proxies, each with the power to appoint his or her
substitute, and hereby authorizes them to represent and to vote, as
designated below, all the shares of Common Stock of Nuclear Metals, Inc. held
of record by the undersigned on March 11, 1996, at the annual meeting of
shareholders to be held on May 1, 1996, or any adjournment thereof.
This proxy when properly executed will be voted in the manner directed herein
by the undersigned stockholder. If no direction is made, this proxy will be
voted "FOR" proposals 1, 2, 3 and 4.
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PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
- -----------------------------------------------------------------------------
Please sign this proxy exactly as your name appears on the books of the
Corporation. Joint owners should each sign personally. Trustees and other
fiduciaries should indicate the capacity in which they sign, and where more
than one name appears, a majority must sign. If a corporation, this
signature should be that of an authorized officer who should state his or her
title.
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- -----------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
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<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1) Election of Directors.
/ / For / / Withhold / / For All Except
George J. Matthews, Wilson B. Tuffin, Robert E. Quinn, Frank H. Brenton
and Kenneth A. Smith
If you do not wish your shares voted "For" a particular nominee, mark
the "For All Except" box and strike a line through that nominee's name.
Your shares will be voted for the remaining nominees(s).
RECORD DATE SHARES:
2) To amend Article III of the Company's Articles of Organization to
provide that the Company shall have authority to issue one million
(1,000,000) shares of Preferred Stock.
/ / For / / Against / / Abstain
3) To approve the adoption by the Board of Directors of the Directors'
Stock Option Plan.
/ / For / / Against / / Abstain
4) To ratify appointment of Arthur Andersen LLP as auditors for the Company.
/ / For / / Against / / Abstain
5) In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
Mark box at right if comments or address change have / /
been noted on the reverse side of this card.
------------------
Please be sure to sign and date this Proxy. Date
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
Shareholder sign here Co-owner sign here
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<PAGE>
NUCLEAR METALS, INC.
Dear Shareholder:
Please take note of the important information enclosed with this Proxy Ballot.
There are a number of issues related to the management and operation of your
Corporation that require your immediate attention and approval. These are
discussed in detail in the enclosed proxy materials.
Your vote counts, and you are strongly encouraged to exercise your right to
vote your shares.
Please mark the boxes on the proxy card to indicate how your shares shall be
voted. Then sign the card, detach it and return your proxy vote in the
enclosed postage paid envelope.
Your vote must be received prior to the Annual Meeting of Shareholders held
on May 1, 1996.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
Nuclear Metals, Inc.
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