<PAGE>
ROBINSON NUGENT, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD NOVEMBER 7, 1996
The Annual Meeting of Shareholders of Robinson Nugent, Inc. will be held at
the Holiday Inn Lakeview, 505 Marriott Drive, Clarksville, Indiana, on Thursday,
November 7, 1996 at 10:00 a.m. (EST) for the following purposes:
1. To elect two directors to serve for terms of three years each;
2. To ratify the selection by the Board of Directors of Coopers & Lybrand
L.L.P. as certified public accountants for the Company for the fiscal
year ending June 30, 1997; and
3. To transact such other business as may properly come before the meeting.
Holders of Common Shares of record at the close of business on September 16,
1996 are entitled to notice of and to vote at the Annual Meeting.
By Order of the Board of Directors
Richard L. Mattox, Secretary
October 4, 1996
New Albany, Indiana
YOUR VOTE IS IMPORTANT. IF YOU DO NOT EXPECT TO ATTEND THE ANNUAL MEETING, OR IF
YOU DO PLAN TO ATTEND BUT WISH TO VOTE BY PROXY, PLEASE DATE, SIGN, AND MAIL
PROMPTLY THE ENCLOSED PROXY. A RETURN ENVELOPE IS PROVIDED FOR THIS PURPOSE.
<PAGE>
ROBINSON NUGENT, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD NOVEMBER 7, 1996
GENERAL INFORMATION
This proxy statement is furnished in connection with the solicitation by the
Board of Directors of Robinson Nugent, Inc. (the "Company") of proxies to be
voted at the Annual Meeting of Shareholders to be held at 10:00 a.m. (EST) on
November 7, 1996, and at any adjournment thereof. The meeting will be held at
the Holiday Inn Lakeview, 505 Marriott Drive, Clarksville, Indiana. This proxy
statement and the accompanying form of proxy were first mailed to shareholders
on or about October 4, 1996.
A shareholder signing and returning the enclosed proxy may revoke it at any
time before it is exercised by written notice to the Secretary of the Company,
by the submission of a subsequent proxy relating to the same shares or by
attending the Annual Meeting and voting in person. All proxies returned prior to
the meeting, and not revoked, will be voted in accordance with the instructions
contained therein. Any proxy not specifying to the contrary will be voted (1)
FOR the election of the nominees for director named below, and (2) FOR the
proposal to ratify the selection of Coopers & Lybrand L.L.P. as certified public
accountants for the Company for the fiscal year ending June 30, 1997.
As of the close of business on September 16, 1996, the record date for the
Annual Meeting, there were outstanding and entitled to vote 4,891,765 Common
Shares of the Company. Each outstanding Common Share is entitled to one vote.
The Company has no other voting securities. Shareholders do not have cumulative
voting rights.
The presence in person or by proxy of a majority of the Common Shares is
necessary in order to constitute a quorum at the Annual Meeting. Proxies marked
as abstaining will be treated as present for purposes of determining a quorum
and will be treated as present and entitled to vote on any matter as to which
abstention is indicated. Proxies returned by brokers as "non-votes" on behalf of
shares held in street name because the beneficial owner has withheld voting
instructions will be treated as present for purposes of determining a quorum but
will not be counted as voting on any matter as to which a non-vote is indicated
on the proxy.
A copy of the Annual Report of the Company, including financial statements
and a description of operations for the fiscal year ended June 30, 1996, has
preceded or accompanies this proxy statement. The financial statements contained
in that report are not incorporated by reference herein.
All expenses in connection with solicitation of proxies will be borne by the
Company. The Company will provide copies of this proxy statement, the
accompanying form of proxy, and the Annual Report to brokers, dealers, banks and
voting trustees, and their nominees, for mailing to beneficial owners and, upon
request therefor, will reimburse such record holders for their reasonable
expenses in forwarding solicitation material. The Company expects to solicit
proxies primarily by mail, but directors, officers and regular employees of the
Company may also solicit in person or by telephone.
Shareholder proposals to be considered for presentation to the 1997 Annual
Meeting of Shareholders must be submitted in writing and received by the Company
on or before June 6, 1997.
The mailing address of the principal offices of the Company is 800 East
Eighth Street, Post Office Box 1208, New Albany, Indiana 47151-1208.
2
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON SHARES
The following table sets forth certain data with respect to those persons
known by the Company to be the beneficial owners of five percent or more of the
outstanding Common Shares of the Company as of September 16, 1996 and also sets
forth such data with respect to each director of the Company, each officer
listed in the Summary Compensation Table, and all directors and executive
officers of the Company as a group. Except as otherwise indicated in the notes
to the table, each beneficial owner possesses sole voting and investment power
with respect to the shares indicated.
<TABLE>
<CAPTION>
NUMBER OF PERCENT
SHARES (1) OF CLASS
--------------- ------------
<S> <C> <C>
PRINCIPAL SHAREHOLDERS
Samuel C. Robinson 1,141,274(2) 22.4%
820 East Market Street
New Albany, Indiana 47150
Lawrence Mazey 366,329(8) 7.2%
228 Santee Path
Louisville, Kentucky 40207
James W. Robinson 303,404(8) 6.0%
7621 State Road 62
Lanesville, Indiana 47136
Dimensional Fund Advisors, Inc. 307,900 6.0%
1299 Ocean Avenue
Santa Monica, California 90401
DIRECTORS AND EXECUTIVE OFFICERS
Samuel C. Robinson 1,141,274(2) 22.4%
James W. Robinson 303,404(8) 6.0%
Larry W. Burke 184,646(3) 3.6%
Richard L. Mattox 27,810(8) *
Jerrol Z. Miles 13,280(8) *
Diane T. Maynard 15,000(4)(8) *
Patrick C. Duffy 31,000(8) *
Richard W. Strain 10,000(8) *
W. Michael Coutu 37,747(5) *
William D. Gruhn 19,838(6) *
J. Henk van Melsen 3,000(7) *
All directors and executive officers 1,786,999(9) 35.0%
as a group (11 persons)
</TABLE>
- ------------------------
*Less than 1%.
(1) The table includes certain shares owned of record by the Company's 401(k)
Plan and the 1993 Employee Stock Purchase Plan. The participants in these
Plans, as noted in the following footnotes, have voting rights but no rights
of disposition with respect to the shares allocated to their respective
accounts.
3
<PAGE>
(2) Includes 14,608 shares owned of record by Mr. Robinson's wife, as to which
she possesses sole voting and investment power, and 7,443 shares owned of
record by National City Bank, Southern Indiana, as trustee for the benefit
of a child, as to which Mr. Robinson and the trustee share voting and
investment power. Mr. Robinson disclaims any beneficial interest in these
shares.
(3) Includes 348 shares owned of record by Mr. Burke's wife, as to which he
disclaims any beneficial interest; 124,297 shares subject to immediately
exercisable options granted pursuant to the Company's Employee Stock Option
Plans; and 56,529 shares allocated to Mr. Burke's account pursuant to the
Company's 401(k) Plan and the 1993 Employee Stock Purchase Plan.
(4) Ms. Maynard shares voting and investment power with her husband with
respect to shares.
(5) Represents 26,497 shares allocated to Mr. Coutu's account pursuant to the
1993 Employee Stock Purchase Plan and 11,250 shares subject to immediately
exercisable options granted pursuant to the Company's 1993 Employee Stock
Option Plan.
(6) Represents 11,438 shares allocated to Mr. Gruhn's account pursuant to the
1993 Employee Stock Purchase Plan and the Company's 401(k) Plan, and 8,400
shares subject to immediately exercisable options granted pursuant to the
Company's 1993 Employee Stock Option Plan.
(7) Represents 3,000 shares subject to immediately exercisable options granted
pursuant to the Company's Employee Stock Option Plans.
(8) Includes 10,000 shares which each named individual may acquire upon
exercise of stock options granted to non-employee members of the Board of
Directors under the 1993 Employee and Non-Employee Director Stock Option
Plan.
(9) Includes in the aggregate 206,947 shares which may be acquired within 60
days upon the exercise of outstanding stock options held by non-employee
directors and executive officers and 97,083 shares allocated to the accounts
of executive officers pursuant to the Company's 401(k) Plan and the 1993
Employee Stock Purchase Plan.
1. ELECTION OF DIRECTORS
NOMINEES
The Bylaws of the Company provide for ten directors, divided into two
classes of three persons and one class of four persons, each of whom is to be
elected for a three-year term. The terms of two incumbent directors, James W.
Robinson and Larry W. Burke, will expire at the Annual Meeting. Lawrence Mazey,
the third director elected in 1993 for a term expiring in 1996, retired from the
Board of Directors in July, 1996. The Board of Directors has nominated Messrs.
Robinson and Burke for reelection to additional three-year terms. The Board of
Directors does not presently intend to fill the remaining two vacancies on the
Board prior to the 1997 Annual Meeting.
Unless authority to vote for such nominees is withheld, the accompanying
proxy will be voted FOR the election of Messrs. Robinson and Burke. However, the
persons designated as proxies reserve the right to vote for another person
designated by the Board of Directors in the event any nominee is unable or
unwilling to serve. The Board of Directors has no reason to believe that any
nominee will be unable or unwilling to serve. Proxies will not be voted for more
than two nominees. Directors are elected by a plurality of the Common Shares
voted in the election.
4
<PAGE>
The following table sets forth information with respect to each nominee for
election to the Board of Directors, and with respect to each director whose term
of office will continue.
<TABLE>
<CAPTION>
SERVED
AS TERM OF
POSITIONS HELD DIRECTOR OFFICE
NAME AGE WITH THE COMPANY SINCE EXPIRES
- ------------------------- --- ------------------------- -------- --------
<S> <C> <C> <C> <C>
Samuel C. Robinson 64 Chairman of the Board of 1955 1997
Directors
James W. Robinson 62 Director 1955 1996
Larry W. Burke 56 President and Chief 1990 1996
Executive Officer and
Director
Richard L. Mattox 62 Secretary and Director 1964 1998
Jerrol Z. Miles 56 Director 1974 1997
Diane T. Maynard 48 Director 1990 1998
Patrick C. Duffy 59 Director 1991 1998
Richard W. Strain 55 Director 1991 1997
</TABLE>
BUSINESS EXPERIENCE OF DIRECTORS
Except as described below, the principal occupations of the directors and
nominees have not changed during the past five years.
Samuel C. Robinson retired as Chairman of the Board and Chief Executive
Officer of the Company on June 30, 1985. He was reelected to the position of
Chairman of the Board on March 6, 1990. He also served as a director of National
City Bank, Southern Indiana, New Albany, until February, 1994.
James W. Robinson served as Executive Vice President of the Company until
June 30, 1985, at which time he was elected as Chairman of the Board. He served
as Chairman of the Board and Treasurer of the Company until his resignation on
January 29, 1987. Mr. Robinson is active in various independent investments
unrelated to the activities of the Company. He is also a director of Caldwell
Tanks, Inc., Community Savings Bank FSB, Hughes Group, Inc., StemWood, Inc., CT
Services, Inc., SCI Broadcasting, Inc., Community Bank Shares of Indiana, Inc.,
and Sunnyside Communications, all of which are located in the Louisville,
Kentucky metropolitan area.
Larry W. Burke has served as President and Chief Executive Officer of the
Company since March 6, 1990. He served as Executive Vice President of the
Company from April, 1986 to March, 1990. Commencing in 1996, Mr. Burke also
served as a Director of Heritage Bank of Southern Indiana, a subsidiary of
Community Bank Shares of Indiana, Inc.
Richard L. Mattox, a partner in the law firm of Mattox & Mattox in New
Albany, Indiana, acted as legal counsel to the Company during fiscal 1996. From
1985 until December, 1990, he was a partner in the law firm of Wyatt, Tarrant,
Combs & Orbison, with offices in New Albany, Indiana, which firm was employed by
the Company with respect to various legal matters.
5
<PAGE>
Jerrol Z. Miles is a Senior Vice President of National City Bank, Kentucky,
located in Louisville, Kentucky, where his primary responsibility is management
of commercial loans and special credit departments. He also serves as a member
of the Board of Advisors of Indiana University Southeast, New Albany, Indiana.
Diane T. Maynard is a management consultant to the Commonwealth of Kentucky
and various businesses as well as an owner of several small businesses in the
Louisville, Kentucky area.
Patrick C. Duffy has been a management consultant since 1988 to various
businesses, with emphasis on the automotive market and related products. He is
the former President and owner of Switches, Inc., an Indianapolis, Indiana
company that produces switches for automobile applications. Mr. Duffy is also a
director and chairman of Accordia of Southeast Florida, located in Clearwater,
Florida.
Richard W. Strain has held a variety of positions with Eli Lilly and
Company. From July 1984 until 1990, he served as president of the Medical
instrument Systems Division; and from 1990 to April 1992, he served as vice
president for Business Development and Pricing. In May 1992, Mr. Strain was
elected as president/CEO of Heart Rhythm Technologies, and in December 1993 he
returned to Eli Lilly and Company headquarters. Since his retirement from Eli
Lilly and Company, Mr. Strain has been president/CEO of a biotech company,
participated in healthcare consulting, and served on several boards.
FAMILY RELATIONSHIPS
Samuel C. Robinson and James W. Robinson are brothers. There is no other
family relationship among the directors and executive officers of the Company.
COMPENSATION OF DIRECTORS
In fiscal 1996, members of the Board of Directors who are not employees of
the Company received remuneration in the amount of $8,000 per year, and in
addition received $1,200 for each meeting of the Board of Directors attended.
Committee members received a minimum of $400 per meeting attended plus $200 per
hour for attendance beyond two hours. The Chairpersons of the Audit and
Compensation Committees received $500 for their services in such capacities
during fiscal 1996. Members of the Board of Directors who are employees of the
Company receive no separate remuneration for their service as directors. The
same compensation plan is effective for fiscal 1997.
Under the provisions of the 1993 Employee and Non-Employee Director Stock
Option Plan approved by the shareholders in November, 1993, non-employee
directors are granted non-qualified stock options (NQSOs) annually to purchase
4,000 common shares of the Company at the then current market price. Such
options were granted to seven Non-Employee Directors on September 13, 1993 with
an exercise price of $8.75 per common share. Additional options to purchase
4,000 common shares were granted on September 13, 1994, September 13, 1995, and
September 13, 1996 to seven Non-Employee Directors at an exercise price of
$6.00, $8.625, and $4.75 per common share, respectively. Options are exercisable
50% after one year from date of grant and 100% after two years from date of
grant, and expire ten years from the date of grant.
During fiscal 1996, Samuel C. Robinson received for his services as Chairman
of the Board of Directors $4,000 per month for the first quarter ended September
30, 1995, and thereafter received $2,000 per quarter and $1,700 per meeting,
plus reimbursement of expenses. Mr. Robinson's aggregate compensation for such
services for fiscal 1996 was $25,223. In fiscal year 1997, Mr. Robinson will
receive remuneration in the amount of $8,000 per year for his services as
Chairman of the Board, an additional $1,700 for each meeting of the Board of
Directors attended and reimbursement of expenses.
6
<PAGE>
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
The Compensation Committee of the Board of Directors is comprised of Richard
L. Mattox, James W. Robinson and Richard W. Strain. The Compensation Committee
also serves as the Stock Option Committee of the Board of Directors. The
responsibilities of the Compensation Committee include making recommendations to
the Board of Directors with respect to: compensation arrangements for the
executive officers of the Company; policies relating to salaries and job
descriptions; insurance programs; and benefit programs of the Company, including
its retirement plans. The Stock Option Committee administers the 1993 Employee
and Non-Employee Director Stock Option Plan. Each of these committees met three
times during fiscal 1996.
The Audit Committee of the Board of Directors is comprised of Patrick C.
Duffy, Diane T. Maynard, and Jerrol Z. Miles. The Audit Committee reviews with
the auditors the scope of the audit work performed, any questions arising in the
course of such work and inquiries as to other pertinent matters such as internal
accounting controls, financial reporting, security and personnel staffing. The
committee met six times during fiscal 1996.
The Board of Directors has no Nominating Committee. The Board of Directors
will consider for nomination as directors persons recommended by shareholders.
Such recommendations must be in writing and delivered to the Secretary, Robinson
Nugent, Inc., P. O. Box 1208, New Albany, Indiana 47151-1208.
The Board of Directors met four times during fiscal 1996. No director
attended fewer than 75% of the meetings of the Board of Directors and meetings
of any committee of the Board of Directors of which he or she was a member.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal year 1996, the Compensation Committee was comprised of
Lawrence Mazey, Richard L. Mattox, James W. Robinson and Richard W. Strain.
Except for Mr. Richard L. Mattox and Mr. James W. Robinson, none of the other
members of the Compensation Committee are now serving or previously have served
as officers of the Company or any subsidiary, and none of the Company's
executive officers serve as directors of, or in any compensation-related
capacity for, companies with which members of the Compensation Committee are
affiliated. Mr. Richard L. Mattox serves as Corporate Secretary of the Company
and various subsidiaries, but receives no compensation for his services in such
capacity. Mr. James W. Robinson held various executive officer positions with
the Company until his retirement in 1987.
EXECUTIVE COMPENSATION
GENERAL
The following Summary Compensation Table sets forth certain information with
respect to the aggregate compensation paid during each of the last three years
to the Company's President and Chief Executive Officer and each of the other
executive officers of the Company whose salary and bonus exceeded $100,000
during fiscal 1996.
7
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION ------------------------
------------------------------------- RESTRICTED
OTHER ANNUAL STOCK OPTIONS/ ALL OTHER
SALARY BONUS COMPENSATION AWARD(S) SAR'S COMPENSATION
YEAR ($) ($) ($)(1) ($) #(2) ($)(3)
--------- --------- --------- --------------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Larry W. Burke, President 1996 206,250 -- 6,997 -- 15,000 66,506
and Chief Executive 1995 201,049 17,500 8,840 -- 13,000 63,098
Officer 1994 184,632 10,000 9,632 -- 12,400 64,948
W. Michael Coutu, 1996 130,000 -- 3,986 -- 8,200 10,261
Vice President of 1995 113,529 6,400 5,036 -- 7,500 7,892
Operations 1994 110,692 11,750 5,488 -- 7,500 10,989
William D. Gruhn, 1996 112,972 -- 3,821 -- 6,400 8,966
Vice President 1995 114,090 5,000 4,827 -- 5,800 7,402
North America Sales 1994 99,036 3,200 5,481 -- 5,500 8,749
Leong Chun Kin, (4) 1996 216,020 -- -- -- -- --
Managing Director, 1995 40,426 -- -- -- -- --
Asia Pacific Operation 1994 -- -- -- -- -- --
J. Henk van Melsen, 1996 198,106 -- -- -- 8,000 39,207
Managing Director, 1995 200,904 4,018 -- -- 6,000 35,233
European Operations(5) 1994 94,714 -- -- -- -- 16,965
</TABLE>
- ------------------------
(1) Represents imputed interest for 1996 attributable to interest-free loans
authorized by the Board of Directors in connection with the purchase of
Common Shares of the Company under the 1993 Employee Stock Purchase Plan.
(2) Represents options granted in 1996 under the 1993 Employee and Non-Employee
Director Stock Option Plan.
(3) Includes contributions by the Company on behalf of the named persons and the
group to the Company's Retirement Plan and 401(k) Plan, and pursuant to
deferred compensation agreements. Effective May 10, 1990, the Company
entered into a deferred compensation agreement with Mr. Burke. The deferred
compensation agreement provides for payments of $50,000 per year to a trust
administered by PNC Bank, Kentucky, Inc., Louisville, Kentucky, as
supplemental retirement income benefits to Mr. Burke. The Company also
entered into a deferred compensation agreement with Mr. van Melsen on
January 1, 1994, requiring the Company to contribute to a fund administered
by Swiss Life Insurance for supplemental retirement benefits in addition to
the Netherland's government pension plan. The 1996 fiscal contribution to
this fund was $39,207. These agreements continue until termination of the
respective employment relationships.
(4) Mr. Leon Chun Kin was appointed Managing Director, Asia Operations, as of
March 29, 1995.
(5) Mr. J. Henk van Melsen was appointed Managing Director, European Operations
as of January 1, 1994.
Each of the officers listed in the Summary Compensation Table serves for a
term of one year.
8
<PAGE>
STOCK OPTIONS
The following table shows the options granted to the named executive
officers of the Company in fiscal 1996. These options are incentive stock
options exercisable as to one-half the shares after the first anniversary of the
date of grant and as to all the shares after the second anniversary of the date
of grant and expire ten years (July 24, 2006) after date of grant. The dollar
amounts under these columns are the result of calculations at 5% and 10% annual
appreciation rates set by the Securities and Exchange Commission for
illustrative purposes, and therefore, are not intended to forecast future
financial performance or possible future appreciation, if any, in the market
prices of the Company's Common Shares. Actual gains, if any, on stock option
exercise will depend on the future performance of the Common Shares and the date
on which options are exercised.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
INDIVIDUAL GRANTS RATES OF SHARE APPRECIATION
------------------------------------------------------ FOR OPTION TERM
% OF TOTAL --------------------------------
OPTIONS OPTIONS 5% YIELDING 10% YIELDING
GRANTED GRANTED TO EXERCISE A SHARE PRICE A SHARE PRICE
# OF EMPLOYEES IN PRICE EXPIRATION OF $15.07 IN OF $23.99 IN
NAME SHARES(1) FISCAL YEAR $/SHARE DATE YEAR 2005 YEAR 2005
- ---------------------------- ----------- --------------- ----------- ----------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Larry W. Burke 15,000 20.2 9.250 7/25/05 87,300 221,100
W. Michael Coutu 8,200 11.0 9.250 7/25/05 47,724 120,868
William D. Gruhn 6,400 8.6 9.250 7/25/05 37,248 94,336
Leong Chun Kin -- -- -- -- -- --
J. Henk van Melsen 8,000 7.8 9.250 7/25/05 46,560 117,920
All employee optionees 74,250 100.0 9.250 7/25/05 432,135 1,094,445
All shareholders -- -- 7/25/05 28,470,072(1) 72,104,616(1)
% of all shareholder gain 1.5% 1.5%
</TABLE>
- ------------------------
(1) Calculated by applying share exercise prices assumed at 5% and 10%
appreciation through the year 2005, less value of outstanding shares at June
30, 1996, with assumed market price of $9.25.
There were no stock options exercised by the executive officers named in the
Summary Compensation Table in fiscal 1996.
The following table sets forth the number of unexercised options held at
June 30, 1996 by each of the Company's executive officers named in the Summary
Compensation Table, and the related values of such options at June 30, 1996. The
value of unexercised options at June 30, 1996 is based upon a market value at
June 30, 1996 of $6.00 per Common Share.
9
<PAGE>
FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS IN-THE-MONEY OPTIONS
AT JUNE 30, 1996 (#) AT JUNE 30, 1996 ($)
-------------------------- --------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Larry W. Burke 124,297 21,500 89,216 --
W. Michael Coutu 11,250 11,950 -- --
William D. Gruhn 8,400 9,300 -- --
Leong Chun Kin -- -- -- --
J. Henk van Melsen 3,000 11,000 -- --
</TABLE>
REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEES
The Compensation Committee and Stock Option Committee of the Board of
Directors has responsibility for the Company's executive compensation program.
The Committee is currently comprised solely of non-employee directors. The
Committee is chaired by Mr. Richard W. Strain. The other Committee members are
Mr. Richard L. Mattox and Mr. James W. Robinson. The following report is
submitted by the members of the Compensation Committee and the Stock Option
Committee.
* * *
The Company's executive compensation program is designed to align executive
compensation with financial performance, business strategies and Company values
and objectives. The Company's compensation philosophy is to ensure that the
delivery of compensation, both in the short- and long-term, is consistent with
the sustained progress, growth and profitability of the Company and acts as an
inducement to attract and retain qualified individuals. This program seeks to
enhance the profitability of the Company, and thereby enhance shareholder value,
by linking the financial interests of the Company's executives with those of its
long-term shareholders. Under the guidance of the Company's Compensation
Committee of the Board of Directors, the Company has developed and implemented
an executive compensation program to achieve these objectives while providing
executives with compensation opportunities that are competitive with companies
of comparable size in related industries.
The Company's executive compensation program has been designed to implement
the objectives described above and is comprised of the following fundamental
three elements:
- a base salary that is determined by individual contributions and sustained
performance within an established competitive salary range. Pay for
performance recognizes the achievement of financial goals, accomplishment
of corporate and functional objectives, and performance of individual
business units of the Company,
- an annual cash bonus that is directly tied to corporate and business unit
performance measures,
- a long-term incentive program that rewards executives when shareholder
value is created through an increase in the market value of the Company's
Common Shares. Stock option grants focus executives on managing the
Company from the perspective of an owner with an equity position in the
business.
10
<PAGE>
BASE SALARY. The salary, and any periodic increase thereof, of the
President and Chief Executive Officer was and is determined by the Board of
Directors of the Company based on recommendations made by the Compensation
Committee. The salaries, and any periodic increases thereof, of the Vice
President, Treasurer and Chief Financial Officer, the Vice President of
Operations, and the Vice President of Marketing, were and are determined by the
Board of Directors based on recommendations made by the President and Chief
Executive Officer and approved by the Committee.
The Company, in establishing base salaries, levels of incidental and/or
supplemental compensation, and incentive compensation programs for its officers
and key executives, assesses periodic compensation surveys and published data
covering the electrical/electronics industry and industry in general. The level
of base salary compensation for officers and key executives is determined by
both their scope and responsibility and the established salary ranges for
officers and key executives of the Company. Periodic increases in base salary
are dependent on the executive's proficiency of performance in the individual's
position for a given period, and on the executive's competency, skill and
experience.
BONUS PAYMENTS. The bonus compensation program for the Company's officers
is subject to annual review by the Compensation Committee and requires annual
approval of the Board of Directors.
Under the bonus plan for executive officers and key employees for fiscal
year 1996, executive officers were eligible for a first tier bonus award
provided the consolidated pretax income of the Company and
subsidiaries for fiscal year 1996 exceeded the reported pretax income for fiscal
year 1995. A second tier, or added bonus, was payable to executive officers
provided the consolidated pretax income for fiscal year 1996 exceeded the pretax
income objectives outlined in the fiscal year 1996 annual financial plan. The
bonus awards under both tiers were predicated upon a formula whereby bonuses
increased in proportion to the level of pretax income over fiscal year 1995 and
the financial plan objectives for fiscal year 1996, respectively. There were no
bonus payments relating to financial performance for fiscal 1996.
The bonus plan for fiscal year 1997 will be similar to the fiscal year 1996
plan with updated financial performance measurements.
LONG-TERM INCENTIVE PLANS. The Company's long-term incentive compensation
program is intended to align executive interest with the long-term interests of
shareholders by linking executive compensation with enhancement of shareholder
value. In addition, the program motivates executives to improve long-term stock
market performance by allowing them to develop and maintain a significant
long-term equity ownership position in the Company's Common Shares.
The 1993 Employee and Non-Employee Director Stock Option Plan was adopted by
the Board of Directors on September 13, 1993, and approved by the shareholders
of the Company at the 1993 annual meeting of the shareholders held on November
4, 1993. Pursuant to this plan 500,000 Common Shares were made available for the
grant of stock options to Non-Employee Directors of the Company and key
employees of the Company and its subsidiaries as determined by the Stock Option
Committee.
11
<PAGE>
On May 28, 1992, the Board of Directors adopted the 1993 Employee Stock
Purchase Plan to provide executive officers and other key employees with the
opportunity to purchase Common Shares and thereby establish or increase their
equity position in the Company. As an added incentive to participants in this
plan, the Company awarded a matching number of Common Shares in proportion (not
more than 50%) to the Common Shares purchased and provided interest-free loans
to the participants, subject to the discretion of the Board of Directors. The
Company's matching shares vest with the participants who remain in the
employment of the Company in three equal annual installments starting in
September, 1994. Loans to employees are payable over periods not to exceed ten
years. Participation in the Plan was completed in fiscal 1993 and the Plan
expired with respect to new participation on November 10, 1993.
SUBMITTED BY THE COMPENSATION AND STOCK OPTION COMMITTEES
Mr. Richard W. Strain
Mr. Richard L. Mattox
Mr. James W. Robinson
12
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STOCK PERFORMANCE GRAPH
The following chart compares the yearly percentage change in the cumulative
total shareholder return on the Company's Common Shares with the cumulative
total return of the NASDAQ market composite (U.S. Companies) and the Peer Group
Index for the five years ending June 30, 1996. The Peer Group consists of AMP
Inc., Augat Inc., Methode Electronics, Inc., Molex Incorporated and Thomas &
Betts Corporation. The Peer Group consists of publicly-held companies, all of
which participate in the electronic connector industry in varying degrees with
respect to their total sales volume. All such companies are significantly larger
than Robinson Nugent, Inc. in terms of sales and assets. The comparison assumes
that $100 was invested on June 30, 1991, in the Company's Common Shares and in
each of the foregoing indices and assumes reinvestment of dividends.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG ROBINSON NUGENT, INC., THE NASDAQ STOCK
MARKET-U.S. COMPANIES INDEX AND A PEER GROUP
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
ROBINSON NUGENT, INC. PEER GROUP NASDAQ STOCK MARKETUS
<S> <C> <C> <C>
1991 100 100 100
1992 133 112 120
1993 282 133 151
1994 244 153 153
1995 398 188 204
1996 263 190 261
</TABLE>
* $100 invested on 06/30/91 in stock or index -- including reinvestment of
dividends. Fiscal year ending June 30.
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CERTAIN TRANSACTIONS
Richard L. Mattox, Secretary, Corporate Counsel and a member of the Board of
Directors of the Company, is a partner in the law firm of Mattox & Mattox, with
offices in New Albany, Indiana. That firm was retained by the Company as legal
counsel during fiscal 1996, and it is anticipated that such relationship will
continue in the current fiscal year.
Jerrol Z. Miles, a director of the Company, is a Senior Vice President of
National City Bank, Kentucky, with which the Company maintains a commercial
banking relationship including a $7,000,000 line of credit. The Company utilized
this loan facility during fiscal 1996 and incurred interest charges of $148,261
on borrowed funds. In fiscal 1996, the Company made periodic investments in
short-term securities administered by National City Bank, Kentucky, and the
Company received interest payments of approximately $11,991 thereon.
The Board of Directors believes that the transactions described above were
on terms no less favorable to the Company than would have been available in the
absence of the relationships described.
Pursuant to the terms of the Company's Employee Stock Purchase Plan, Messrs.
Burke, Coutu and Gruhn have borrowed $165,000, $94,000 and $90,100,
respectively, from the Company to purchase Common Shares of the Company. These
loans are non-interest bearing and are payable over a period not to exceed ten
years. At June 30, 1996, the principal balances of these loans to Messrs. Burke,
Coutu and Gruhn were $86,741, $49,416 and $809, respectively.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the officers
and directors of the Company to file initial reports of ownership and reports of
changes in ownership of the Common Shares of the Company. The officers and
directors are required by SEC regulations to furnish the Company with copies of
all Section 16(a) forms filed by them.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, all reports required by Section 16(a) of the Securities
Exchange Act of 1934 related to market transactions in the Common Shares of the
Company were timely filed; however, each of the Company's officers and directors
(Larry W. Burke, W. Michael Coutu, James W. Robinson, Richard L. Mattox, Jerrol
Z. Miles, Diane T. Maynard, Patrick C. Duffy, Richard W. Strain) failed to
timely file one report required as a result of the grant to such persons of
options pursuant to the Company's Stock Option Plan.
2. RATIFICATION OF SELECTION OF
CERTIFIED PUBLIC ACCOUNTANTS
Subject to ratification by the shareholders, the Board of Directors has
selected Coopers & Lybrand L.L.P. as certified public accountants for the
Company for the fiscal year ending June 30, 1997. The Company has been advised
by such firm that neither it nor any of its associates has any direct or
material indirect financial interest in the Company. In order for Coopers &
Lybrand L.L.P. to be ratified as the certified public accountants for the
Company for the fiscal year ending June 30, 1997, a majority of the Common
Shares represented and entitled to vote at the Annual Meeting must be
affirmatively voted FOR approval of this proposal.
14
<PAGE>
Coopers & Lybrand L.L.P. acted as certified public accountants for the
Company since fiscal 1993. Representatives of Coopers & Lybrand L.L.P. are
expected to be present at the Annual Meeting, will have the opportunity to make
a statement if they desire to do so, and will be available to respond to
appropriate questions concerning their audits.
3. OTHER MATTERS
As of the date of this proxy statement, the Board of Directors of the
Company has no knowledge of any matters to be presented for consideration at the
meeting other than those referred to above. If (a) any matters not within the
knowledge of the Board of Directors as of the date of this proxy statement
should properly come before the meeting; (b) a person not named herein is
nominated at the meeting for election as a director because a nominee named
herein is unable to serve or for good cause will not serve; (c) any proposals
properly omitted from this proxy statement and the form of proxy should come
before the meeting; or (d) any matters should arise incident to the conduct of
the meeting; then the proxies will be voted in accordance with the
recommendations of the Board of Directors of the Company.
By Order of the Board of Directors
Richard L. Mattox, Secretary
October 4, 1996
15
<PAGE>
PROXY
ROBINSON NUGENT, INC.
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD NOVEMBER 7, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
The undersigned hereby appoints Samuel C. Robinson and Larry W. Burke, and
each of them, the proxies of the undersigned, with full power of substitution,
to vote all Common Shares of Robinson Nugent, Inc. which the undersigned is
entitled to vote at the Annual Meeting of Shareholders of the Company to be held
November 7, 1996, or any adjournment thereof.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY /X/
FOR all nominees listed below (except
as marked to the contrary below). / /
WITHHOLD AUTHORITY to vote for all
nominees listed below. / /
1. ELECTION OF DIRECTORS:
Larry W. Burke and James W. Robinson
(INSTRUCTION: To WITHHOLD authority to vote for any
individual nominee, write that nominee's name on
the space provided below.)
- ---------------------------------------------
2. Proposal to ratify the selection of Coopers & Lybrand
L.L.P.as certified public accountants for the fiscal
year ending June 30,1997.
For Against Abstain
/ / / / / /
3. The proxies are authorized to vote in their discretion on
any other matters which may properly come before the Annual
Meeting to the extent set forth in the proxy statement.
Dated: , 1996
----------------------------
----------------------------------------
(Signature)
----------------------------------------
(Signature)
Please date this proxy. If shares are held jointly, both
joint owners should sign. If signing as attorney, executor,
administrator, guardian or in any other representative
capacity, please give your full title as such.
