<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
FILED BY THE REGISTRANT /X/ FILED BY A PARTY OTHER THAN THE REGISTRANT / /
- --------------------------------------------------------------------------------
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
Dynatech Corporation
(Name of Registrant as Specified In Its Charter)
Dynatech Corporation
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 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:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
/X/ Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
[LOGO]
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
Burlington, Massachusetts
June 21, 1995
To the Stockholders of
Dynatech Corporation:
Notice is hereby given that the Annual Meeting of Stockholders of Dynatech
Corporation will be held in the Goodwin, Procter & Hoar Conference Center, 2nd
Floor, Exchange Place, Boston, Massachusetts on Thursday, July 27, 1995 at 10:00
a.m. for the following purposes:
1. To fix the number of Directors at eight and to elect a class of three
Directors to serve for a three-year term and until their successors are
elected and qualified;
2. To consider and act upon a proposal to increase authorized Common Stock
by 26,000,000 additional shares;
3. To consider and act upon a proposal to approve the actions taken by the
Board of Directors to Amend the 1994 Stock Option and Incentive Plan;
4. To consider and act upon a proposal to approve the adoption by the
Board of Directors of the Non-Employee Directors' Stock Compensation
Plan; and
5. To consider and act upon any other matters which may properly come
before the meeting or any adjournment thereof.
Stockholders of record at the close of business on June 12, 1995 will be
entitled to notice of and to vote at the meeting or any adjournment thereof.
By Order of the Board of Directors
ROBERT H. HERTZ
Clerk
- --------------------------------------------------------------------------------
IF YOU ARE UNABLE TO BE PRESENT AT THE MEETING, YOU ARE REQUESTED TO
COMPLETE, DATE, AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE.
- --------------------------------------------------------------------------------
<PAGE> 3
DYNATECH CORPORATION
PROXY STATEMENT
FOR
THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 27, 1995
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors of Dynatech Corporation (the "Company"). The enclosed
proxy, if properly executed and returned, may be revoked at any time before it
is exercised by delivering to the Clerk of the Company a duly executed written
notice of revocation, by delivering a duly executed proxy bearing a later date,
or by attending the Annual Meeting and voting in person. Attendance at the
Annual Meeting will not, by itself, revoke a proxy.
Stock transfer books will not be closed, but the Board of Directors has
fixed the close of business on June 12, 1995 as the record date for determining
the stockholders entitled to notice of, and to vote at, this annual meeting and
any adjournment thereof. On that date there were outstanding and entitled to
vote 17,593,778 shares of the Company's Common Stock, par value $.20 per share
("Common Stock"). Each share of Common Stock is entitled to one vote.
The Corporate Headquarters of the Company are located at 3 New England
Executive Park, Burlington, Massachusetts 01803-5087. This statement and the
enclosed proxy are first being mailed to stockholders on or about June 21, 1995.
The Company's Annual Report for the fiscal year ended March 31, 1995,
containing financial statements for that year and prior periods, is being mailed
to stockholders concurrently with this statement.
PROPOSAL NO. 1
ELECTION OF A CLASS OF DIRECTORS
Stockholders will be asked to fix the number of directors at eight. The
Board of Directors is divided into three classes, with the Directors in each
class serving for a term of three years and until their successors are duly
elected and qualified. As the term of one class expires, a successor class is
elected at each annual meeting of stockholders.
At the Annual Meeting, a class of three Directors will be elected to serve
for three years until the 1998 annual meeting and until their successors are
duly elected and qualified. The Board of Directors has nominated O. Gene
Gabbard, Richard K. Lochridge, and Ronald L. Bittner as a class of Directors
(the "Nominees"). Each of the Nominees is currently serving as a Director of the
Company. The Board of Directors anticipates that each of the Nominees will stand
for election and will serve, if elected, as a Director. However, if any person
nominated by the Board of Directors fails to stand for election or is unable to
accept election, the proxies will be voted for the election of such other person
or persons as the Board of Directors may recommend. When a quorum is present, a
plurality of the votes cast of the Common Stock represented in person or by
proxy and entitled to vote at the Annual Meeting is required for the election of
Directors. The holders of a majority in interest of all stock outstanding and
entitled to vote at the Annual Meeting shall constitute a quorum.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE
ELECTION OF THE NOMINEES.
<PAGE> 4
<TABLE>
INFORMATION REGARDING NOMINEES AND DIRECTORS
The following table sets forth certain information, as of May 1, 1995, with
respect to the Nominees and those Continuing Directors of the Company whose
terms expire at the annual meetings of stockholders in 1996 and 1997, based upon
information furnished by them.
NOMINEES FOR ELECTION AT 1995 ANNUAL MEETING
(CLASS WITH TERM EXPIRING IN 1998)
<CAPTION>
NAME AND PRINCIPAL OCCUPATION DIRECTOR
FOR AT LEAST THE PAST FIVE YEARS AGE SINCE
-------------------------------------------------------------------- --- --------
<S> <C> <C>
O. Gene Gabbard (B)(C)(E) 55 1994
Consultant and entrepreneur who works with high technology
start-up companies. Prior to that, Mr. Gabbard was an Executive
Vice President and Chief Financial Officer of MCI Communications
Corporation. Mr. Gabbard is a Director of InterCel, Inc.
Richard K. Lochridge (B)(E) 51 1986
President and Chief Executive Officer of Lochridge and Company,
Inc., Boston, Massachusetts, a management consulting firm. Prior
to that, Mr. Lochridge was a Vice President of the Boston
Consulting Group, Boston, Massachusetts and a member of the
Management Committee of the Boston Consulting Group, Inc. Mr.
Lochridge is a Director of Scott Paper Company and Hannaford
Brothers Food, Inc.
Ronald L. Bittner (A) 53 1995(1)
Chairman, CEO, President, and Director of Frontier Corporation, a
national telecommunications company in Rochester, NY since 1993;
President and Chief Executive Officer since 1992. Prior to 1992,
President of Telecom Group.
</TABLE>
<TABLE>
CONTINUING DIRECTORS
(CLASS WITH TERM EXPIRING IN 1996)
<CAPTION>
NAME AND PRINCIPAL OCCUPATION DIRECTOR
FOR AT LEAST THE PAST FIVE YEARS AGE SINCE
-------------------------------------------------------------------- --- --------
<S> <C> <C>
William R. Cook (B)(C) 51 1994(2)
President and Chief Executive Officer of Betz Laboratories, Inc.
of Trevose, Pennsylvania since 1994; President and Chief Operating
Officer from 1990 to 1993. Mr. Cook is a Director of Betz
Laboratories, Inc. and Chemical Manufacturers Association. He is a
Trustee of the Academy of Natural Sciences.
James B. Hangstefer (A)(E) 68 1963
President of Cordel Associates, Inc., Waltham, Massachusetts, a
business consultant. Mr. Hangstefer is a Director of Aerovox
Corporation.
Robert. G. Paul (B)(C) 53 1994(3)
President and Chief Executive Officer of The Allen Group Inc.,
manufacturer and marketer of electronics and other products for
the wireless communications industry, in Beachwood, Ohio since
1991; President and Chief Operating Officer prior to 1991. Mr.
Paul is a Director of The Allen Group Inc.
</TABLE>
2
<PAGE> 5
CONTINUING DIRECTORS
(CLASS WITH TERM EXPIRING IN 1997)
<TABLE>
<CAPTION>
NAME AND PRINCIPAL OCCUPATION DIRECTOR
FOR AT LEAST THE PAST FIVE YEARS AGE SINCE
-------------------------------------------------------------------- --- ----
<S> <C> <C>
Theodore Cohn (A)(B)(C) 72 1976
Management Consultant, New York, New York, and a Director of
Diagnostic Retrieval Systems, Inc.
John F. Reno (E) 56 1993
President and Chief Executive Officer of the Company since January
1993; President and Chief Operating Officer from July 1991 to
January 1993; Executive Vice President and Chief Operating Officer
prior to July 1991. Mr. Reno is a Director of Millipore
Corporation.
<FN>
- ---------------
(A) Member of the Audit Committee.
(B) Member of the Board Governance Committee.
(C) Member of the Compensation Committee.
(E) Member of the Executive Committee.
(1) Mr. Bittner was elected a Director of the Company in March 1995.
(2) Mr. Cook was elected a Director of the Company in September 1994.
(3) Mr. Paul was elected a Director of the Company in November 1994.
</TABLE>
COMMITTEES OF THE BOARD OF DIRECTORS
The Company has Executive, Audit, Compensation, and Board Governance
Committees of the Board of Directors.
The Board of Directors met twelve times during the year ended March 31,
1995. Each Director attended at least 75 percent of the aggregate number of
meetings of the Board of Directors and the committees on which he or she served.
The Executive Committee, which met four times in fiscal year 1995, is
vested with the authority of the Board of Directors in most matters between
meetings of the Board of Directors.
The Audit Committee, which met on two occasions in fiscal year 1995,
recommends to the Board of Directors the appointment of the independent public
accountants, reviews the scope and budget for the annual audit, and reviews the
results of the examination of the Company's financial statements by the
independent public accountants. The Audit Committee also periodically reviews
the job performance of the Chief Financial Officer. The Company's financial
personnel and independent public accountants have free access to the Committee.
The Compensation Committee reviews the Company's executive compensation and
benefit policies as further described in the Compensation Committee Report on
Executive Compensation included in this proxy statement. The Committee met five
times during fiscal year 1995. The Company is not aware of any Compensation
Committee interlocks.
The Board Governance Committee which was established in 1994 as the
Nominating Committee and was renamed the Board Governance Committee in June,
1995 met on two occasions in fiscal year 1995. The Board Governance Committee
consists of Directors who are not officers or employees of the Company or any
subsidiary of the Company. The Board Governance Committee is charged with the
responsibility of evaluating the Board of Directors' structure, personnel, and
processes so as to permit the Board of Directors to discharge successfully its
fiduciary duties and to consider the needs of the Company's stockholders. In
this connection,
3
<PAGE> 6
the Board Governance Committee recommends to the Board of Directors the slate of
nominees for election as Director at each annual meeting of stockholders. The
Board Governance Committee will consider the recommendation of any stockholder
with respect to nominees for election to the Board of Directors. Any such
recommendation should be accompanied by all relevant information, including
information required by the applicable rules of the Securities and Exchange
Commission (the "Commission") and any other industry experience. To make a
recommendation, a stockholder should send the nominee's name and supporting
information to the Clerk of the Company at the Company's principal executive
office. In order to permit the Board Governance Committee to give fair
consideration to any such recommendation, the information should be received by
the date specified under the applicable rules of the Commission relating to
stockholder proposals.
Moreover, the Company's By-laws provide that, in order to be considered at
an annual meeting, any nomination for a candidate for election as a Director,
other than those made by, or at the direction of, the Board of Directors, must
be delivered to, or mailed and received by, the Company not less than 75 days
nor more than 120 days prior to the anniversary date of the immediately
preceding annual meeting (the "Anniversary Date"); provided, however, that in
the event the annual meeting is scheduled to be held on a date more than 30 days
before or more than 60 days after the Anniversary Date, notice must be so
delivered not later than the close of business on the later of (i) the 75th day
prior to the scheduled date of such annual meeting or (ii) the 15th day after
public disclosure of the date of such meeting. To make such a nomination, a
stockholder should send the nominee's name and appropriate supporting
information, as set forth in the Company's By-laws, to the Company at its
principal executive office.
COMPENSATION OF DIRECTORS
Compensation of non-employee Directors ("Non-Employee Directors") of the
Company is at the rate of $1,500 for each Board of Directors or committee
meeting attended ($500 for each committee meeting held directly before or after
a meeting of the Board of Directors), $750 for a meeting held over the
telephone, plus a quarterly retainer fee paid at the rate of 400 shares of
Dynatech Common Stock per quarter. The Chairman of the Board is paid an
additional $15,000 quarterly. Chairmen of all Committees other than the
Executive and Board Governance Committees receive an additional 100 shares of
Dynatech Common Stock per quarter. All non-employee members of the Executive
Committee receive an additional 200 shares of Dynatech Common Stock. In
addition, the Dynatech Corporation 1994 Stock Option and Incentive Plan (the
"Stock Incentive Plan") provides for the automatic grant of stock options to
Non-Employee Directors of the Company. After June 16, 1994, each Non-Employee
Director is entitled to receive an option to purchase 10,000 shares of Common
Stock upon initial election to the Board of Directors and an additional option
to purchase 3,000 shares of Common Stock after each Annual Meeting of
Stockholders. Moreover, certain one-time grants of stock options were awarded
under the Stock Incentive Plan to Non-Employee Directors on June 16 and July 1,
1994. See "Summary of Stock Incentive Plan -- Stock Options Granted to
Non-Employee Directors." Non-Employee Directors who have served on the Board for
at least five years are also entitled to receive an annual retirement benefit
equal to $16,000. Such retirement benefit is payable following the Non-Employee
Director's 60th birthday or retirement from the Board (or such later date as the
Director shall elect) for a period equal to the number of full years of service
on the Board, up to a maximum of ten years.
4
<PAGE> 7
<TABLE>
PRINCIPAL STOCKHOLDERS
Based upon information contained in the most recent Schedule 13D, Schedule
13G, or other information available to the Company, the following entities
beneficially owned more than five percent (5%) of the Company's Common Stock as
of May 1, 1995:
<CAPTION>
SHARES
NAME OWNED PERCENTAGE(1)
---- --------- -------------
<S> <C> <C>
FMR Corp................................................ 2,279,900 13.0%
82 Devonshire Street
Boston, MA 02109
Trimark Investment Management Inc....................... 1,151,000 6.5%
One First Canadian Place
Suite 5600, P.O. Box 487
Toronto, Ontario
Canada M5X 1E5
<FN>
- ---------------
(1) Based on the number of shares of Common Stock outstanding as of May 1, 1995.
</TABLE>
<TABLE>
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information as of May 1, 1995, with
respect to the shares of Common Stock of the Company beneficially owned by each
Director of the Company, each of the executive officers named in the Summary
Compensation Table herein, and by all Directors and executive officers as a
group.
<CAPTION>
DEFERRED
STOCK
AMOUNT AND OPTION SHARES RETAINER PERCENTAGE
NATURE OF SUBJECT TO SHARES OF COMMON
NAME OF INDIVIDUAL BENEFICIAL OWNERSHIP(1) VESTING (2) (3) STOCK(4)
- ------------------------------ ----------------------- ------------- --------- ----------
<S> <C> <C> <C> <C>
O. Gene Gabbard............... 2,100 10,000 0 *
Richard K. Lochridge.......... 6,000 15,000 2,100 *
Ronald L. Bittner............. 0 10,000 400 *
William R. Cook............... 3,200 10,000 0 *
James B. Hangstefer........... 36,000(5) 30,000 1,900 *
Robert G. Paul................ 800 10,000 0 *
Theodore Cohn................. 51,200(6) 0 0 *
Paula Stern................... 800(7) 15,000 1,200 *
John F. Reno.................. 88,956(8) 248,000 0 *
John R. Peeler................ 17,720(9) 100,000 0 *
Robert H. Hertz............... 27,672(10) 56,000 0 *
John R. South................. 3,000(11) 60,000 0 *
Jack Shirman.................. 16,600(12) 26,000 0 *
All Directors and Executive
Officers (18 persons)....... 297,668(13) 713,000 5,600 1.7 %
<FN>
- ---------------
* Less than 1%
(1) Represents shares of Common Stock beneficially owned on May 1, 1995 based
upon information supplied by the persons listed. Unless otherwise noted,
each person has sole voting and investment power with respect to such
shares. The shares have been adjusted to reflect the two-for-one stock
split effective March 15, 1995.
</TABLE>
5
<PAGE> 8
(2) Represents shares of Common Stock underlying stock options already granted
but which are not yet vested or exercisable within 60 days of May 1, 1995.
(3) Represents shares of Common Stock payable but receipt of which has been
voluntarily deferred pursuant to the terms of the Non-Employee Directors'
Stock Compensation Plan discussed in Proposal No. 4.
(4) Based upon the number of shares of Common Stock outstanding as of May 1,
1995. Common Stock includes all outstanding Common Stock plus, as required
for the purpose of determining beneficial ownership (in accordance with
Rule 13d-3 promulgated pursuant to the Securities Exchange Act of 1934, as
amended), all Common Stock subject to any right of acquisition by such
person, through exercise or conversion of any security, within 60 days of
May 1, 1995.
(5) Includes 6,000 shares owned by his spouse, as to which Mr. Hangstefer
disclaims any beneficial ownership.
(6) Includes 30,000 shares of Common Stock issuable upon exercise of stock
options which are exercisable within 60 days of May 1, 1995.
(7) Dr. Stern's term as a Director will terminate effective July 27, 1995.
(8) Includes 2,000 shares owned by his spouse and 11,050 shares owned by a
relative for which Mr. Reno has power of attorney. Includes 48,000 shares
of Common Stock issuable upon exercise of stock options which are
exercisable within 60 days of May 1, 1995.
(9) Includes 10,400 shares of Common Stock issuable upon exercise of stock
options which are exercisable within 60 days of May 1, 1995.
(10) Includes 8,000 shares owned by his spouse. Includes 13,400 shares of Common
Stock issuable upon exercise of stock options which are exercisable within
60 days of May 1, 1995.
(11) Represents 3,000 shares of Common Stock issuable upon exercise of stock
options which are exercisable within 60 days of May 1, 1995.
(12) Includes 8,000 shares of Common Stock issuable upon exercise of stock
options which are exercisable within 60 days of May 1, 1995.
(13) Includes 121,600 shares of Common Stock issuable upon exercise of stock
options which are exercisable within 60 days of May 1, 1995. Excludes
shares which may become vested and exercisable upon a Change in Control as
defined in the stock option plan pursuant to which such options were
granted.
6
<PAGE> 9
<TABLE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following summary compensation table sets forth information concerning
compensation awarded to, earned by, or paid to the Company's Chief Executive
Officer and four highest paid executive officers for services rendered in all
capacities with respect to the Company's fiscal years ended March 31, 1993,
1994, and 1995.
<CAPTION>
LONG TERM COMPENSATION
-------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
- -----------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
OTHER
NAME ANNUAL RESTRICTED ALL OTHER
AND COMPEN- STOCK OPTIONS/ LTIP COMPEN-
PRINCIPAL FISCAL SALARY BONUS SATION AWARD(S) SARS PAYOUTS SATION
POSITION YEAR ($) ($) ($)(1) ($) (#)(2) ($) ($)(3)
- ----------------------------- ------ ------- ------- ------- ----------- ----------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
John F.Reno.................. 1995 385,000 420,609 -- -- 144,000 -- 5,571
President and 1994 370,000 26,492 -- -- 0 -- 3,907
Chief Executive Officer 1993 313,750 256,652 -- -- 104,000 -- 5,612
John R. Peeler............... 1995 213,000 305,790 -- -- 64,000 -- 5,519
Corporate Vice President -- 1994 200,000 120,804 -- -- 0 -- 3,882
Communications Test
Division................... 1993 185,000 189,213 -- -- 36,000 -- 5,575
Robert H. Hertz.............. 1995 200,000 170,244 -- -- 30,000 -- 5,571
Treasurer and Chief
Financial.................. 1994 195,000 9,372 -- -- 0 -- 3,907
Officer 1993 185,000 117,932 -- -- 26,000 -- 5,612
John R. South................ 1995 189,583 191,211 -- -- 40,000 -- 5,397
Corporate Vice President -- 1994 189,250 0 -- -- 0 -- 4,167
Medical 1993 185,750 82,570 -- -- 20,000 -- 4,667
Jack Shirman................. 1995 226,000 325,070 -- -- 41,000 -- 5,404
Former Corporate 1994 220,000 136,185 -- -- 0 -- 3,828
Vice President(4) 1993 210,000 168,393 -- -- 26,000 -- 5,499
<FN>
- ---------------
(1) Perquisites and other personal benefits paid to each named executive officer
in each instance aggregated less than 10% of the total annual salary and
bonus set forth in the columns entitled "Salary" and "Bonus" for each named
executive officer, and accordingly, are therefore omitted from the table as
permitted by the rules of the Securities and Exchange Commission.
(2) Adjusted to reflect two-for-one stock split effective March 15, 1995.
(3) Figures in this column represent the Company's contributions on behalf of
each of the executive officers under the Company's 401(k) plan.
(4) Mr. Shirman resigned as Corporate Vice President of the Company on April 30,
1995. In connection with his resignation as Corporate Vice President of the
Company, it is expected that Mr. Shirman will receive monthly payments of
$18,917 until April 30, 1996.
</TABLE>
7
<PAGE> 10
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
The following chart sets forth information concerning individual grants of
stock options to the named executive officers during the fiscal year ended March
31, 1995.
<CAPTION>
POTENTIAL
REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM
- ----------------------------------------------------------------------------------------------- ------------------------
(a) (b) (c) (d) (e) (f) (g)
% OF
TOTAL
NUMBER OPTIONS
OF SECURITIES GRANTED
UNDERLYING TO EXERCISE
OPTIONS EMPLOYEES OR BASE
GRANTED IN FISCAL PRICE EXPIRATION
NAME (#)(1) YEAR (%) ($/SH)(1) DATE 5%($) 10%($)
---- ------------- --------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
John F. Reno........................... 44,000 5.7 10.50 * 290,549 736,309
100,000 12.9 17.50 * 1,100,566 2,789,049
John R. Peeler......................... 44,000 5.7 10.50 * 290,549 736,309
20,000 2.6 17.50 * 220,113 557,810
Robert H. Hertz........................ 30,000 3.9 10.50 * 198,102 502,029
John R. South.......................... 10,000 1.3 10.50 * 66,034 167,343
30,000 3.9 17.50 * 330,170 836,715
Jack Shirman........................... 41,000 5.3 10.50 * 270,739 686,106
<FN>
- ---------------
* Options vest annually in five equal installments beginning on the
anniversary of the date of grant. Options generally expire 10 years after
grant.
(1) Adjusted to reflect two-for-one stock split.
The table also shows the value of the options granted at the end of the
option terms if the price of the Common Stock were to appreciate annually by 5%
and 10%, respectively. There is no assurance that the stock price will
appreciate at the rates shown in the table. If the stock price appreciates, the
value of stock held by all stockholders will increase.
</TABLE>
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUE
The following chart sets forth certain information regarding stock option
exercises by the named executive officers during the fiscal year ended March 31,
1995 and stock options held by the named executive officers at March 31, 1995.
<CAPTION>
(a) (b) (c) (d) (e)
--- ----------------- --------- ------------- -----------------
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FY-END(#)(1) FY-END($)
VALUE ------------- -----------------
SHARES ACQUIRED REALIZED EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(#)(1) ($) UNEXERCISABLE UNEXERCISABLE
---- ----------------- --------- ------------- -----------------
<S> <C> <C> <C> <C>
John F. Reno.................................. 15,440 89,138 40,000/256,000 379,800/1,692,000
John R. Peeler................................ 13,080 99,265 7,600/102,800 68,750/888,050
Robert H. Hertz............................... 31,600 216,700 9,400/60,000 91,600/640,750
John R. South................................. 0 0 1,800/61,200 16,425/338,450
Jack Shirman.................................. 8,600 73,450 4,000/71,000 36,500/756,250
<FN>
- ---------------
(1) Adjusted to reflect two-for-one stock split.
</TABLE>
8
<PAGE> 11
SPECIAL TERMINATION AGREEMENTS
Each of the persons named in the compensation table set forth above as well
as other key employees have entered into Special Termination Agreements with the
Company. These Agreements provide that if there is a "Change in Control" of the
Company (as defined in the Agreements), and if during the two-year period
following such Change in Control the officer's employment is terminated for any
reason other than on account of death or for "cause," or the officer terminates
his or her own employment following a demotion, reduction in compensation, or
similar event, the officer will be entitled to receive a lump sum payment from
the Company within 15 days after the date of termination and continuance of
fringe benefits. Under the Agreements, the amount of the severance payment is
based on an officer's length of service with the Company, ranging incrementally
from one times the officer's average annual cash compensation to three times the
officer's average annual cash compensation after fifteen years of service.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors was established in
1979 and is comprised solely of independent, Non-Employee Directors. The
Committee reviews and approves all compensation plans, benefit programs, and
perquisites for executives and other employees. The Committee sets the salary of
the Chief Executive Officer (CEO), sets relative relationships between the CEO
salary and salary of other key executives, and recommends to the Board the
compensation program for Directors. The Committee reviews and approves
management recommendations for stock option grants under the Company's stock
option plans. The Committee periodically reviews the job performance of the
Chief Executive Officer.
The Company's executive compensation program has been designed to attract
and retain exceptional executives who seek a long-term association with the
Company and who enjoy the challenge of pay for performance. The basic program
consists of two cash compensation components: base salary and a performance
based annual bonus. A third component, ownership-linked stock options, is used
for executive retention, to attract new key people, to recognize accomplishments
under individually tailored business growth programs, and to align the long-term
interests of eligible executives with those of the stockholders.
Base salary for the CEO is set annually taking into consideration company
sales and profit growth, overall job performance, and mid-range pay levels for
CEOs of corporations of a similar size. The Committee utilizes, as a reference,
up-to-date information on compensation practices of other companies from several
independent and reliable sources. Base salary is then set so as to represent no
more than 40% of total attainable compensation, the majority of which is fully
contingent upon the achievement of both qualitative and quantitative levels of
performance and stockholder return. Mr. Reno's base salary was increased to
$430,000 on January 1, 1995. His prior increase was upon his election as Chief
Executive Officer of the Company on January 1, 1993. Mr. Reno's base salary is
considered to be at approximately the median base compensation level paid to
chief executive officers of corporations of a similar size and complexity to the
Company.
The Company's pay for performance annual bonus program is considered the
most significant cash-based compensation component. Executives in this program
earn a bonus set by growth in profit and return on assets from either their
particular business unit or the Company as a whole. The plan is formula-based
using weighted average three year (current and two trailing) performance and is
designed so that consistently good individual performance over the three years
provides the executive with the highest payout. The intent is to encourage
investment decisions in undertakings that will provide the best medium term
(three year) financial results. With consistently outstanding profit growth, an
executive can earn a bonus of several times the executive's annual salary; or,
with no profit growth and return on assets below standard, no bonus at all. For
fiscal year 1995, Mr. Reno's bonus, earned as a result of current and prior
years' performance, represents
9
<PAGE> 12
approximately 97.8% of his current base salary. This compares to fiscal year
1994 when his bonus, calculated under the same formula, represented 7.2% of his
base salary.
The third compensation component is an ownership-linked stock option
program. This is the long-term element in the compensation program. Stock
options, granted at market price, vest annually in 20% increments over five
years. A longer term perspective is established by sequential grants. The stock
option program requires specified levels of continued stock ownership for senior
executives based on position and years of participation in the program. The
program is designed to encourage senior executives to be long-term stockholders
and to have owner concern and care for the Company as a whole. The intent of the
option program is to provide an executive with the opportunity for financial
gain which is larger than cumulative annual bonuses but which takes much longer
to achieve; and which requires meaningful long-term growth in the market price
of the Company's Common Stock for the gain to be realized.
The size and frequency of option grants are based on level of
responsibility, performance of the Company as a whole, the performance of the
executive's business unit, and the executive's personal performance. Both
financial and non-financial specific goals are set aimed at building future
marketplace strengths, intercompany cooperation and alliances, achieving
corporate success factors, and, when appropriate, restructuring issues. For
senior executives the option grant may be subject to reduction and/or
elimination in proportion to the executive's ownership position relative to
ownership levels required by the plan. Other option grants may be made based
upon management's specific recommendations, and review and approval by the
Compensation Committee. Grants are made from a Compensation Committee defined
pool of shares.
Section 162(m) of the Internal Revenue Code (the "Code"), which became
effective on January 1, 1994, will generally limit the Company's ability to
deduct compensation expense in excess of $1 million paid to the Company's Chief
Executive Officer or other executive officers named in the Summary Compensation
Table contained in this proxy statement. The Committee's policy with respect to
Code Section 162(m) is to make every reasonable effort to insure that
compensation is deductible to the extent permitted while simultaneously
providing Company executives with appropriate rewards for their performance.
Towards this end, the Company's 1994 Stock Option and Incentive Plan has been
drafted in a manner that will qualify stock options as performance-related
compensation not subject to the cap on deductibility imposed by Code Section
162(m).
O. Gene Gabbard, Chairman
Theodore Cohn
William R. Cook
Robert G. Paul
10
<PAGE> 13
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
FOR THE YEAR ENDED MARCH 31, 1995
The graph that follows compares the five-year cumulative total return of
the Common Stock with the S&P 500 Composite Stock Price Index and the S&P High
Tech Composite Index. It assumes an investment of $100 on March 31, 1990 in the
Common Stock of the Company, and the stocks comprising the S&P 500 and the S&P
High Tech Composite Index.
<TABLE>
<CAPTION>
Measurement Period DYNATECH S&P 500 IN- HIGH TECH
(Fiscal Year Covered) CORP. DEX COMPOSITE
<S> <C> <C> <C>
1990 100 100 100
1991 130.65 114.41 109.17
1992 127.42 127.05 111.71
1993 172.58 146.39 122.75
1994 119.35 148.55 144.38
1995 203.23 171.68 182.71
<FN>
This total stockholders return model assumes reinvested dividends.
Prepared by Standard & Poor's Compustat, a division of McGraw-Hill
Companies, Inc.
</TABLE>
PROPOSAL NO. 2
APPROVAL TO INCREASE AUTHORIZED COMMON STOCK
BY 26,000,000 ADDITIONAL SHARES
Presently authorized capital stock of the Company consists of 24,000,000
shares of Common Stock, par value $.20 per share, and 100,000 shares of Serial
Preference Stock, par value $1 per share, of which 24,000 shares have been
designated as Series A Junior Participating Cumulative Preferred Stock ("Series
A Preferred Stock"). On the June 12, 1995 record date there were outstanding
17,593,778 shares of Common Stock and no shares of Serial Preference Stock or
Series A Preferred Stock. On that date there were 3,926,364 shares of Common
Stock unissued and not reserved for issuance. The holders of Common Stock are
not entitled to preemptive rights.
11
<PAGE> 14
The Board of Directors considers it desirable that the Company have
authority to issue more shares of Common Stock. It recommends that the Company's
Restated Articles of Organization be amended to increase its authorized Common
Stock from 24,000,000 to 50,000,000 shares, and that the Board of Directors be
authorized to determine the terms and manner of issuing such Common Stock.
At the present time, the Company has no plans, arrangements,
understandings, or commitments to issue the proposed increased shares of Common
Stock. The additional authorized Common Stock, together with the presently
authorized but unissued shares, will be available, without further stockholder
approval, for such general corporate purposes as the Board of Directors may from
time to time determine, including, without implied limitation, public or private
sales thereof, issuance in connection with acquisitions, mergers, stock options,
and stock dividends and splits.
The proposed increase in the number of authorized shares of Common Stock
could be considered to be "anti-takeover" in nature if unreserved shares were
issued under circumstances intended to discourage or make more difficult an
attempt by a person or organization to gain control of the Company. Such
issuances may also be specifically designed to frustrate or discourage attempts
to effect a merger with or otherwise gain control of the Company. The Board of
Directors has not, however, designed the proposed increase of authorized shares
of Common Stock as part of an "anti-takeover" strategy. The Company's management
has no knowledge of any present specific effort by an identified persons or
organizations to accumulate the Company's shares or otherwise gain control of
the Company.
Adoption of the proposed amendment to the Restated Articles of Organization
regarding the 26,000,000 additional shares of Common Stock requires the
affirmative vote of the holders of at least a majority of the outstanding shares
of the Company's Common Stock.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE PROPOSAL TO INCREASE AUTHORIZED
COMMON STOCK BY 26,000,000 ADDITIONAL SHARES BE APPROVED, AND THEREFORE
RECOMMENDS A VOTE FOR THIS PROPOSAL.
PROPOSAL NO. 3
APPROVAL OF AMENDMENT TO THE 1994 STOCK OPTION AND INCENTIVE PLAN
PROPOSAL
The Board of Directors has adopted an amendment to the Dynatech Corporation
1994 Stock Option and Incentive Plan (the "Stock Incentive Plan") and is
recommending the amendment to stockholders for approval. The amendment would
increase the number of shares available for issuance under the Stock Incentive
Plan by 1,900,000 shares and would limit grants of restricted stock,
unrestricted stock, and performance share awards to no more than 665,000 shares,
or 35 percent of reserved shares. The amendment would also prohibit the
Compensation Committee from repricing options without stockholder approval.
REASONS FOR THE AMENDMENT
The Board of Directors believes that stock options and other stock-based
awards play an important role in the success of the Company and that this role
must increase if the Company is to continue to attract, motivate, and retain the
caliber of Directors, officers, and other employees necessary to the Company's
future growth and success. The amendment is necessary because there are only
29,000 shares currently available for grant under the Stock Incentive Plan.
The Board of Directors believes that adding more shares to the Stock
Incentive Plan will help the Company to achieve its goals by keeping the
Company's incentive compensation program competitive with
12
<PAGE> 15
those of other companies. Accordingly, the Board of Directors has approved,
subject to stockholder approval, the proposed increase of 1,900,000 shares
available under the Stock Incentive Plan.
As of June 12, 1995, options to purchase 871,000* shares of Common Stock
were outstanding under the Stock Incentive Plan.
The closing price of the Common Stock on June 12, 1995 was $19.00 per
share.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE AMENDMENT TO THE STOCK INCENTIVE
PLAN BE APPROVED, AND THEREFORE RECOMMENDS A VOTE FOR THIS PROPOSAL.
SUMMARY OF THE STOCK INCENTIVE PLAN
The material terms of the Stock Incentive Plan are summarized below. The
summary is qualified in its entirety by the full text of the Stock Incentive
Plan.
Plan Administration; Eligibility. The Stock Incentive Plan is administered
by a Committee of the Board of Directors of the Company consisting of the
Compensation Committee of the Board of Directors. All members of the Committee
must be "disinterested persons" as that term is defined under the rules
promulgated by the Securities and Exchange Commission and "outside directors" as
defined in Section 162 of the Internal Revenue Code of 1986, as amended (the
"Code") and the regulations promulgated thereunder.
The Committee has full power to select, from among the persons eligible for
awards, the individuals to whom awards will be granted, to make any combination
of awards to participants, and to determine the specific terms of each award,
subject to the provisions of the Stock Incentive Plan. Persons eligible to
participate in the Stock Incentive Plan are generally those employees of the
Company and its Subsidiaries who are responsible for or contribute to the
management, growth, or profitability of the Company and its Subsidiaries, as
selected from time to time by the Committee. Non-Employee Directors of the
Company are also eligible for certain awards under the Stock Incentive Plan.
Stock Options. The Stock Incentive Plan permits the granting of both
options to purchase Common Stock intended to qualify as incentive stock options
("Incentive Options") under Section 422 of the Code and options that do not so
qualify ("Non-Qualified Options"). The option exercise price of each option will
be determined by the Committee but may not be less than 100% of the fair market
value of the shares on the date of grant except that, upon the request of an
employee and with the consent of the Committee, an employee may elect to receive
a Non-Qualified Option in lieu of any cash bonus to which he may become entitled
during the following calendar year pursuant to any other plan of the Company if
such employee makes an irrevocable election to waive receipt of all or a portion
of such cash bonus. Awards of Incentive Options may be granted under the Stock
Incentive Plan until June 15, 2004.
The term of each option will be fixed by the Committee and may not exceed
ten years from date of grant in the case of an Incentive Option. The Committee
will determine at what time or times each option may be exercised and, subject
to the provisions of the Stock Incentive Plan, the period of time, if any, after
retirement, death, disability, or termination of employment during which options
may be exercised. Options may be made exercisable in installments, and the
exercisability of options may be accelerated by the Committee.
Upon exercise of options, the option exercise price must be paid in full
either in cash or by certified or bank check or other instrument acceptable to
the Committee or by delivery of shares of Common Stock already owned by the
optionee. The exercise price may also be delivered to the Company by a broker
pursuant
- ---------------
* Adjusted to reflect two-for-one stock split.
13
<PAGE> 16
to irrevocable instructions to the broker from the optionee. The Committee will
not permit payment of the exercise price by a promissory note or Company loan.
To qualify as Incentive Options, options must meet additional Federal tax
requirements, including limits on the value of shares subject to Incentive
Options which first become exercisable in any one year, and a shorter term and
higher minimum exercise price in the case of certain large stockholders.
In order to satisfy the performance-based compensation exception to the $1
million cap on the Company's tax deduction imposed by Section 162(m) of the
Code, the Stock Incentive Plan also provides that no individual may be granted
options in any calendar year to purchase more than 200,000* shares of Common
Stock.
Repricing. The Committee's ability to substitute options previously
granted with new options has been restricted. The Committee shall not, without
further approval of the stockholders of the Company, authorize the amendment of
any outstanding option to reduce the option price. Furthermore, no option shall
be cancelled and replaced with options having a lower option exercise price
without approval of the stockholders of the Company.
Stock Options Granted to Non-Employee Directors. The Stock Incentive Plan
provides for the automatic grant of Non-Qualified Options to Non-Employee
Directors. Each Non-Employee Director who was serving as a Director of the
Company on June 16, 1994 and who had served as a Director of the Company
continuously for fifteen years or more as of such date was automatically granted
on July 1, 1994 a Non-Qualified Option to purchase 30,000* shares of Common
Stock. Each Non-Employee Director who was serving as a Director of the Company
on June 16, 1994 and who had served as a Director of the Company for more than
five years but less than fifteen years as of such date was granted on June 16,
1994 a Non-Qualified Option to purchase 15,000* shares of Common Stock. Each
Non-Employee Director who was serving as a Director of the Company on June 16,
1994 and who had served as a Director of the Company for less than five years as
of such date was automatically granted on July 1, 1994 a Non-Qualified Option to
purchase 10,000* shares of Common Stock. Each Non-Employee Director who is first
elected as a Director after June 16, 1994 will automatically be granted on the
date first elected as a Director a Non-Qualified Option to purchase 10,000*
shares of Common Stock. Each Non-Employee Director who is serving as Director of
the Company on the fifth business day after each annual meeting of stockholders,
beginning with the 1995 Annual Meeting, shall automatically be granted on such
day a Non-Qualified Option to purchase 3,000* shares of Common Stock. The
exercise price of each such Non-Qualified Option is to be equal to the fair
market value of the Common Stock on the date of grant.
Restricted Stock. The Committee may also award shares of Common Stock
subject to such conditions and restrictions as the Committee may determine
("Restricted Stock"). These conditions and restrictions may include the
achievement of certain performance goals and/or continued employment with the
Company through a specified restricted period. The purchase price, if any, of
shares of Restricted Stock will be determined by the Committee. If the
performance goals and other restrictions are not attained, the employees may
forfeit their awards. Restricted Stock also may be granted to an employee by the
Committee in lieu of a cash bonus due to such employee pursuant to any other
plan of the Company.
Unrestricted Stock. The Committee may also grant shares (at no cost or for
a purchase price determined by the Committee) which are free from any
restrictions under the Stock Incentive Plan ("Unrestricted Stock"). Unrestricted
Stock may be issued to employees in recognition of past services or other valid
consideration, and may be issued in lieu of cash bonuses to be paid to such
employees.
- ---------------
* Adjusted to reflect two-for-one stock split.
14
<PAGE> 17
A Non-Employee Director may, pursuant to an irrevocable written election at
least six months before directors' fees would otherwise be paid, receive all or
a portion of such fees in Unrestricted Stock (valued at fair market value on the
date the directors' fees would otherwise be paid.)
Performance Share Awards. The Committee may grant awards ("Performance
Share") to employees entitling the recipient to receive shares of Common Stock
upon the achievement of individual or Company performance goals and such other
conditions as the Committee shall determine. Except as otherwise determined by
the Committee, rights under a Performance Share award not yet earned will
terminate upon a participant's termination of employment. Performance Shares may
be awarded independently or in connection with stock options or other awards
under the Stock Incentive Plan.
Limitation on Issuance of Restricted Stock, Unrestricted Stock, and
Performance Share Awards. The Committee's ability to grant Restricted Stock,
Unrestricted Stock, and Performance Share Awards has been limited. Under the
Stock Incentive Plan, as amended, no more than 665,000 shares, or 35 percent of
reserved shares, may be granted in the form of Restricted Stock, Unrestricted
Stock, and Performance Share Awards.
Adjustments for Stock Dividends, Mergers, Etc. The Committee will make
appropriate adjustments in outstanding awards to reflect stock dividends, stock
splits, and similar events. In the event of a merger, liquidation, or similar
event, the Committee in its discretion may provide for substitution or
adjustments or may (subject to the provisions described below under "Change of
Control Provisions") accelerate or, upon payment or other consideration for the
vested portion of any awards as the Committee deems equitable in the
circumstances, terminate such awards.
Tax Withholding. Plan participants are responsible for the payment of any
Federal, state, or local taxes which the Company is required by law to withhold
from the value of any award. The Company may deduct any such taxes from any
payment otherwise due to the participant. Participants may elect to have such
tax obligations satisfied either by authorizing the Company to withhold shares
of stock to be issued pursuant to an award under the Stock Incentive Plan or by
transferring to the Company shares of Common Stock having a value equal to the
amount of such taxes. Such an election is subject to certain limitations for
participants subject to the requirements of Section 16(b) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
Amendments and Termination. The Board of Directors may at any time amend
or discontinue the Stock Incentive Plan, and the Committee may at any time amend
or cancel outstanding awards for the purpose of satisfying changes in the law or
for any other lawful purpose. However, no such action may be taken which
adversely affects any rights under outstanding awards without the holder's
consent. Further, Plan amendments shall be subject to approval by the Company's
stockholders if and to the extent required by the Exchange Act to ensure that
awards granted under the Stock Incentive Plan are exempt under Rule 16b-3
promulgated under the Exchange Act or to preserve the status of Incentive
Options granted under the Stock Incentive Plan.
Change of Control Provisions. The Stock Incentive Plan provides that in
the event of a "Change of Control" of the Company, all stock options shall
automatically become fully exercisable, unless the Committee shall otherwise
provide at the time of the grant. Restrictions and conditions on awards of
Restricted Stock likewise shall automatically be deemed waived. In addition, at
any time prior to or after a Change of Control, the Committee may accelerate
awards and waive conditions and restrictions on any awards to the extent it may
determine appropriate.
15
<PAGE> 18
STOCKHOLDERS' VOTE
The amendment to the Stock Incentive Plan will become effective upon
approval by the holders of at least a majority of the shares of Common Stock
present or represented and entitled to vote at the Annual Meeting.
NEW PLAN BENEFITS
Approximately 500 employees and all Non-Employee Directors are eligible to
participate in the Stock Incentive Plan. As of June 12, 1995, no options have
been granted under the Stock Incentive Plan with respect to the proposed
increase in shares available for issuance.
TAX ASPECTS UNDER THE U.S. INTERNAL REVENUE CODE
The following is a summary of the principal Federal income tax consequences
of option grants under the Stock Incentive Plan. It does not describe all
Federal tax consequences under the Stock Incentive Plan, nor does it describe
state or local tax consequences.
Incentive Options. No taxable income is realized by the optionee upon the
grant or exercise of an Incentive Option. If shares issued to an optionee
pursuant to the exercise of an Incentive Option are not sold or transferred
within two years from the date of grant or within one year after the date of
exercise, then (a) upon sale of such shares, any amount realized in excess of
the option price (the amount paid for the shares) will be taxed to the optionee
as a long-term capital gain and any loss sustained will be a long-term capital
loss, and (b) there will be no deduction for the Company for Federal income tax
purposes. The exercise of an Incentive Option will give rise to an item of tax
preference that may result in alternative maximum tax liability for the
optionee.
If shares of Common Stock acquired upon the exercise of an Incentive Option
are disposed of prior to the expiration of the two-year and one-year holding
periods described above (a "disqualifying disposition"), generally (a) the
optionee will realize ordinary income in the year of disposition in an amount
equal to the excess (if any) of the fair market value of the shares at exercise
(or, if less, the amount realized on a sale of such shares) over the option
price thereof, and (b) the Company will be entitled to deduct such amount.
Special rules will apply where all or a portion of the exercise price of the
Incentive Option is paid by tendering shares of Common Stock.
If an Incentive Option is exercised at a time when it no longer qualifies
for the tax treatment described above, the option is treated as a Non-Qualified
Option. Generally, except in the case of death, an Incentive Option will not be
eligible for the tax treatment described above if it is exercised more than
three months following termination of employment (or one year in the case of
termination of employment by reason of death or disability).
Non-Qualified Options. With respect to Non-Qualified Options under the
Stock Incentive Plan, no income is realized by the optionee at the time the
option is granted. Generally, (a) at exercise, ordinary income is realized by
the optionee in an amount equal to the difference between the option price and
the fair market value of the shares on the date of exercise, and the Company
receives a tax deduction for the same amount, and (b) at disposition,
appreciation or depreciation after the date of exercise is treated as either
short-term or long-term capital gain or loss depending on how long the shares
have been held. Special rules will apply where all or a portion of the exercise
price of the Non-Qualified Option is paid by tendering shares of Common Stock.
Section 83 of the Code and the regulations thereunder provide that the date
for reporting and determining the amount of ordinary income (and the Company's
equivalent deduction) upon exercise of a Non-Qualified
16
<PAGE> 19
Option and for the commencement of the holding period of the shares thereby
acquired by a person who is a "Section 16(b) person," as defined in the Code,
will be delayed until the date that is the earlier of (i) six months after the
date of exercise and (ii) such time as the shares received upon exercise could
be sold at a gain without the person being subject to such potential liability.
Payments in Respect of a Change of Control. The Stock Incentive Plan
provides for acceleration or payment of awards and related shares in the event
of a Change of Control. Such acceleration or payment may cause the consideration
involved to be treated in whole or in part as "parachute payments" under the
Code. Acceleration of benefits under other Company stock and benefits plans and
other contracts with employees in the event of a Change of Control could be
subject to being combined with Plan accelerations for "parachute payment"
purposes. Any such "parachute payments" may be non-deductible to the Company in
whole or in part, and the recipient may be subject to a 20% excise tax on all or
part of such payments (in addition to other taxes ordinarily payable).
Limitation on the Company's Deduction. As a result of new Section 162(m)
of the Code, the Company's deduction for a taxable year for certain awards under
the Stock Incentive Plan may be limited to the extent that a "covered employee"
(e.g., the chief executive officer and four other executives named in the Cash
Compensation Table) receives compensation in excess of $1,000,000 in such
taxable year of the Company (other than performance-based compensation that
otherwise meets the requirements of Section 162(m) of the Code).
PROPOSAL NO. 4
APPROVAL OF NON-EMPLOYEE DIRECTORS' STOCK COMPENSATION PLAN
PROPOSAL
The Board of Directors has adopted the Dynatech Corporation Non-Employee
Directors' Stock Compensation Plan (the "Stock Retainer Plan") for Non-Employee
Directors of the Company, effective as of October 1, 1994, subject to the
approval of the Stock Retainer Plan by the stockholders.
The Stock Retainer Plan replaces the cash retainer previously paid to
Non-Employee Directors and provides for shares of Common Stock to be issued
based on a written formula.
Subject to adjustment for stock splits, stock dividends, and similar
events, the total number of shares of Common Stock that can be issued under the
Stock Retainer Plan is 100,000*. The closing price of the Common Stock on June
12, 1995 was $19.00 per share.
RECOMMENDATION
The contributions and services of the Company's Non-Employee Directors are
essential to the Company's continued growth and progress. In order to attract
and retain highly qualified individuals to serve on the Board, the Company
redesigned the compensation package for Non-Employee Directors and replaced the
quarterly cash retainer with a retainer payable in the form of shares of Common
Stock. The Company believes that it is desirable for Directors to acquire an
equity interest in the Company and the Stock Retainer Plan has been designed to
achieve such goal. The amount of the stock retainer payable is determined
pursuant to a written plan formula which will not be materially increased
without subsequent stockholder approval. The payment of stock retainers to the
Non-Employee Directors will motivate the Directors to contribute to the
- ---------------
* Adjusted to reflect two-for-one stock split.
17
<PAGE> 20
Company's future growth and success and will align the long-term interests of
the Directors with the interests of all stockholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCK RETAINER PLAN BE APPROVED,
AND THEREFORE RECOMMENDS A VOTE FOR THIS PROPOSAL.
SUMMARY OF THE STOCK RETAINER PLAN
The material terms of the Stock Retainer Plan are summarized below. The
summary is qualified in its entirety by the full text of the Stock Retainer Plan
which is attached hereto as Exhibit A. Capitalized terms used herein and not
otherwise defined have the meanings provided in the Stock Retainer Plan.
Plan Administration; Eligibility. The Stock Retainer Plan is to be
administered by a Compensation Committee of the Board of Directors. Each
Non-Employee Director of the Company is eligible to participate in the Stock
Retainer Plan.
Stock Retainer. Each Non-Employee Director is eligible to receive 400
shares of Common Stock per quarter as a stock retainer. In addition, each
Non-Employee Director who serves as a member of the Executive Committee is
entitled to receive 200 shares of Common Stock per quarter, and each Non-
Employee Director who serves as a Chairman of a Committee of the Board (other
than the Executive and Board Governance Committees) is entitled to receive 100
shares of Common Stock per quarter. Unless the Non-Employee Director has filed a
written election to defer receipt of the stock retainer pursuant to the terms of
the Stock Retainer Plan, the stock retainer is payable on the first day of each
calendar quarter. Each Non-Employee Director may elect to defer receipt of the
stock retainer for a minimum of five years or until termination of service as a
Director of the Company. The deferred stock retainer is credited in stock units
equivalent to Common Stock to a deferred stock account and held for the benefit
of the Director. During the period of deferral, the deferred stock account will
be credited with dividend equivalent amounts if the Company declares a dividend.
The stock units, which at all times are fully vested, will be paid in the form
of shares of Common Stock in either a lump sum or in annual installments over a
period of up to ten years, as elected by the Director.
Investments for Stock Dividends, Stock Splits, etc. The Compensation
Committee will adjust the plan formula, the reserved shares, and the stock units
in the deferred stock accounts to reflect stock dividends, stock split, or
similar events.
Amendments and Termination. The Board of Directors may terminate or amend
the Stock Retainer Plan, but no amendment may adversely affect the rights of any
Non-Employee Director to the stock units credited to his deferred stock account,
and to stock retainer already earned without such Director's consent. All
material amendments to the Stock Retainer Plan must be submitted for stockholder
approval to the extent necessary for the Stock Retainer Plan to satisfy the
requirements of the exemption from the short-swing profits rules under Section
16 of the Exchange Act. Except in limited circumstances, certain provisions
which govern eligibility for and amount, price, and timing of payment of stock
retainer or stock units may not be amended more than once every six months.
Change of Control Provisions. The Stock Retainer Plan provides that in the
event of a "Change of Control" of the Company, all stock units in the deferred
stock account maintained under the Stock Retainer Plan will be payable in a lump
sum in shares of Common Stock.
18
<PAGE> 21
STOCKHOLDERS' VOTE
The Stock Retainer Plan will become effective, as of October 1, 1994, upon
approval by the holders of at least a majority of the shares of Common Stock
present or represented and entitled to vote at the Annual Meeting.
NEW PLAN BENEFITS
DYNATECH CORPORATION NON-EMPLOYEE DIRECTORS' STOCK COMPENSATION PLAN
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
NON-EXECUTIVE DIRECTOR GROUP COMMON STOCK*
---------------------------- -------------
<S> <C>
8 Non-employee Directors as a group.................... 12,300
<FN>
- ---------------
* This number represents the number of shares of Common Stock, adjusted to
reflect two-for-one stock split, payable in the form of a stock retainer from
October 1, 1994 through April 1, 1995 and includes the number of stock units
credited to deferred stock accounts. The aggregate fair market value of such
shares and stock units, determined as of June 12, 1995 was $233,700.
</TABLE>
SELECTION OF AUDITORS
The Board of Directors has selected the accounting firm of Coopers &
Lybrand to serve as the Company's principal accountant for the fiscal year
ending March 31, 1996. Coopers & Lybrand acted as principal accountant for the
fiscal year ended March 31, 1995. A representative of Coopers & Lybrand will be
present at the Annual Meeting, available to respond to appropriate questions,
and given the opportunity to make a statement if the representative so desires.
PROPOSALS BY STOCKHOLDERS
In order for a proposal of a stockholder to be included in the Board of
Directors' proxy statement for the Company's 1996 Annual Meeting, it must be
received at the principal executive office of the Company on or before February
20, 1996, pursuant to Rule 14a-8 under the Exchange Act. Such a proposal must
comply with the requirements as to form and substance established by the
Securities and Exchange Commission in order to be included in the proxy
statement.
In addition, the Company's By-laws provide that any stockholder of record
wishing to have a stockholder proposal considered at an annual meeting, other
than a stockholder proposal included in the Company's proxy statement pursuant
to Rule 14a-8 under the Exchange Act, must provide written notice of such
proposal and appropriate supporting documentation, as set forth in the By-laws,
to the Company at its principal executive office not less than 75 days nor more
than 120 days prior to the anniversary date of the immediately preceding annual
meeting (the "Anniversary Date"); provided, however, that in the event the
annual meeting is scheduled to be held on a date more than 30 days before or
more than 60 days after the Anniversary Date, notice must be so delivered not
later than the close of business on the later of (i) the 75th day prior to the
scheduled date of such annual meeting or (ii) the 15th day after public
disclosure of the date of such meeting.
VOTING AND SOLICITATION OF PROXIES
The persons named in the enclosed proxy will vote as directed in the proxy,
and in the absence of such direction will vote for the election of the
applicable nominees for Director named herein and for each of the
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<PAGE> 22
proposals described herein. The presence, either in person or by duly executed
proxy, of the holders of a majority of outstanding shares of Common Stock
entitled to vote at a meeting is necessary to constitute a quorum. Shares that
reflect abstentions or "broker non-votes" (i.e., shares held by brokers that are
represented at the meeting but as to which such brokers have not received
instructions from the beneficial owners and, with respect to one or more but not
all issues, such brokers do not have discretionary voting power to vote such
shares) will be counted for purposes of determining whether a quorum is present
for the transaction of business at the meeting. With respect to Proposal 1,
Election of a Class of Directors, abstentions and broker non-votes will have no
impact on the outcome of the vote. With respect to Proposal 2, Approval to
Increase Authorized Common Stock by 26,000,000 Additional Shares, which proposal
relates to the amendment of the Restated Articles of Organization, abstentions
and broker non-votes will be counted as votes against the proposal. With respect
to Proposals 3 and 4, Approval of Amendment to the 1994 Stock Option and
Incentive Plan and Approval of the Dynatech Corporation Non-Employee Directors'
Stock Compensation Plan, which proposals relate to stock-based compensation
plans qualifying for exemption under Rule 16b-3 of the Securities Exchange Act
of 1934, as amended, abstentions will be treated as votes cast against such
proposals while broker non-votes, if any, will have no impact on the outcome of
the votes.
The cost of soliciting proxies will be borne by the Company. The
solicitation of proxies by mail may be followed by solicitation of certain
stockholders by officers, Directors, or employees of the Company by telephone or
in person. The Company also has retained MacKenzie Partners, Inc. to assist in
the solicitation of proxies at an estimated cost of $5,000 plus reasonable
expenses.
OTHER MATTERS
The Board of Directors of the Company is not aware of any other matters
which may come before the meeting. It is the intention of the persons named in
the enclosed proxy to vote the proxy in accordance with their best judgment if
any other matters should properly come before the meeting, including voting for
election of a Director in place of any person named in the proxy who may not be
available for election.
IF YOU MAY NOT BE PRESENT AT THE MEETING, IT WOULD BE APPRECIATED IF YOU
WOULD COMPLETE, DATE, AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE.
Burlington, Massachusetts
June 21, 1995
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EXHIBIT A
DYNATECH CORPORATION
NON-EMPLOYEE DIRECTORS' STOCK COMPENSATION PLAN
I. INTRODUCTION
The Dynatech Corporation Non-Employee Directors' Stock Compensation Plan
(the "Plan"), effective October 1, 1994, specifies the compensation to be paid
by Dynatech Corporation (the "Company") in shares of Common Stock of the Company
("Stock") for services performed by the members of its Board of Directors who
are not employees of the Company ("Non-Employee Directors"). The Plan permits a
Non-Employee Director to defer receipt of all or any part of the compensation
payable to him under the Plan.
II. ADMINISTRATION
The Plan shall be administered by the Compensation Committee of the Board
of Directors of the Company (the "Committee"). The Committee shall have complete
discretion and authority with respect to the Plan and its application, except as
expressly limited by the Plan.
III. ELIGIBILITY
All Non-Employee Directors are eligible to participate in the Plan.
IV. STOCK RETAINERS
Subject to the availability of shares under Article VI, each Non-Employee
Director shall be entitled to receive a quarterly retainer of 400 shares of
Stock, augmented by each of the following amounts for which he qualifies: for
service as a member of the Executive Committee, 200 shares of Stock; and for
service as Chairman of each Committee other than the Executive Committee, 100
shares of Stock. Except to the extent deferred under Article V, retainers shall
be paid, in shares of Stock, on the first day of each calendar quarter.
V. DEFERRAL OF STOCK RETAINER
A. Election to Defer. A Non-Employee Director may elect in advance to
defer the receipt of some or all of each quarterly Stock retainer. To make such
an election, the Non-Employee Director must execute and deliver to the Committee
an election form specifying the percentage of his Stock retainers he wishes to
defer. Unless otherwise approved by the Committee, any election under this
paragraph shall apply only to Stock retainers that are both (i) payable more
than six (6) months after receipt and acceptance of such election by the Company
and (ii) earned in quarters beginning on or after the start of the next calendar
year after such receipt and acceptance. An election shall remain in effect from
year to year, until a revocation or new election becomes effective. A
Non-Employee Director may revoke his deferral election with respect to Stock
retainers that are payable more than six (6) months after receipt and acceptance
by the Company of his written revocation.
B. Deferred Stock Account. As of the first day of each calendar quarter, a
Non-Employee Director's deferred Stock account ("Account") shall be credited
with a number of whole shares of Stock determined by multiplying his elective
deferral percentage by the number of shares in his Stock retainer for the
quarter and dropping any fraction of a share.
C. Dividend Equivalent Amounts. Subject to the availability of shares
under Article VI, whenever dividends (other than dividends payable only in
shares of Stock) are paid with respect to Stock, each Account
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shall be credited with a number of whole and fractional shares of Stock
determined by multiplying the dividend value per share by the Stock balance of
the Account on the record date and dividing the result by the fair market value
of a share of Stock on the dividend payment date. For this purpose, "fair market
value" of a share of Stock on any given date shall mean the last reported sale
price at which Stock is traded on such date, or if no Stock is traded on such
date, the most recent date on which Stock was reflected on the NASDAQ National
Market System, or if applicable, any other national stock exchange on which
Stock is traded.
D. Period of Deferral. Each Non-Employee Director making an election
pursuant to Paragraph V.A shall specify the deferral period applicable to his
Account. Such period shall be either (i) a specified number of years, not fewer
than five (5), after the date such specification is made by the Non-Employee
Director or (ii) until the Non-Employee Director's termination of membership on
the Board of Directors of the Company.
E. Designation of Beneficiary. A Non-Employee Director may designate one
or more beneficiaries to receive payments from his Account in the event of his
death. A designation of beneficiary shall apply to a specified percentage of a
Non-Employee Director's entire interest in his Account. Such designation, or any
change therein, must be in writing and shall be effective upon receipt by the
Company. If there is no effective designation of beneficiary, or if no
beneficiary survives the Non-Employee Director, the estate of the Non-Employee
Director shall be deemed to be the beneficiary. All payments to a beneficiary or
estate shall be made in a lump sum in shares of Stock, with any fractional share
paid in cash.
F. Payment. All amounts credited to a Non-Employee Director's Account
shall be paid in shares of Stock to the Non-Employee Director, or his designated
beneficiary (or beneficiaries) or estate, (i) in a lump sum at the end of the
deferral period determined by the deferral election in effect for the Account or
(ii) at the Non-Employee Director's prior election, in annual installments over
a period of up to ten (10) years; provided, however, that fractional shares
shall not be paid but shall be aggregated with the next installment, if any,
payable from the Account or otherwise shall be paid in cash. Notwithstanding the
foregoing, in the event of a Change in Control, all Accounts under the Plan
shall become immediately payable in a lump sum.
G. Change in Control. "Change in Control" shall mean the occurrence of any
one of the following events:
(i) when, without the prior approval of the Prior Directors of the
Company, any Person is or becomes the "beneficial owner" (as defined in
Section 13(d) of the Securities Exchange Act of 1934, as amended (the
"Act"), and the rules and regulations promulgated thereunder), together
with all "affiliates" and "associates" (as such terms are used in Rule
12b-2 of the rules and regulations promulgated under the Act) of such
Person, directly or indirectly, of 25% or more of the outstanding Stock;
(ii) the failure of the Prior Directors to constitute a majority of
the Board of Directors of the Company at any time within the two years
following any Electoral Event; or
(iii) any other event that the Prior Directors shall determine
constitutes an effective change in the control of the Company.
For purposes of the above definition, the following terms shall have the
indicated meanings: "Electoral Event" means any contested election of Directors
of the Company, or any tender or exchange offer for the Stock, not approved by
the Prior Directors, by any Person other than the Company or a Subsidiary;
"Person" shall include any natural person, any entity, any "affiliate" (as such
term is defined in Rule 405 promulgated under the Securities Act of 1933, as
amended) of any such natural person or entity and any "group" (within the
meaning of such term in Rule 13d-5 promulgated under the Act); "Prior Directors"
means the Directors in office immediately prior to any Electoral Event (or, if
there has been no Electoral Event, the Directors in
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<PAGE> 25
office on October 1, 1994) and any future Director who has been nominated or
elected by a majority of the Prior Directors who are then members of the Board
of Directors; and "Subsidiary" means any corporation or other entity (other than
the Company) in any unbroken chain of corporations or other entities beginning
with the Company if each of the corporations or entities (other than the last
corporation or entity in the chain) owns stock or other interests possessing 50%
or more of the total combined voting power of all classes of stock or other
interests in one of the other corporations or entities in the chain.
VI. SHARES ISSUABLE; ADJUSTMENTS
A. Shares Issuable. The aggregate maximum number of shares of Stock
reserved and available for issuance under the Plan shall be 100,000. Shares
subject to the Plan are authorized but unissued shares, or shares that were once
issued and subsequently reacquired by the Company.
B. Adjustments. In the event of a stock dividend, stock split, or similar
change in capitalization affecting the Stock, the Committee shall make
appropriate adjustments in (i) the number and kind of shares of Stock or
securities on which Stock retainers and dividend equivalents ("Stock Awards")
shall thereafter be granted, and (ii) the number and kind of shares remaining
subject to outstanding Stock Awards (including shares credited to a Non-Employee
Director's Account). In the event of any merger, consolidation, dissolution, or
liquidation of the Company, the Committee in its sole discretion may, as to any
outstanding Stock Awards, make such substitution or adjustment in the aggregate
number of shares reserved for issuance under the Plan and the number of shares
subject to such Stock Awards as it may determine and as may be permitted by the
terms of such transaction, or amend, or terminate such Stock Awards upon such
terms and conditions as it shall provide (which, in the case of the termination
of any Stock Award, shall require payment or other consideration which the
Committee deems equitable in the circumstances).
VII. AMENDMENT OR TERMINATION OF PLAN
The Company reserves the right to amend or terminate the Plan at any time,
by action of its Board of Directors, provided that no such action shall
adversely affect a Non-Employee Director's right to receive compensation earned
before the date of such action or his rights under the Plan with respect to
amounts credited to his Account before the date of such action, and provided,
further, that following approval of the Plan by the Company's shareholders, (i)
the provisions of the Plan governing eligibility for and amount, price, and
timing of Stock Awards may not be amended more than once every six (6) months,
other than to comport with changes in the Internal Revenue Code, the Employee
Retirement Income Security Act, or the rules thereunder, and (ii) to the extent
required by the Act to ensure that Stock Awards are exempt under Rule 16b-3
promulgated under the Act. Plan amendments shall be subject to approval by the
Company's shareholders.
VIII. MISCELLANEOUS PROVISIONS
A. No Distribution; Compliance with Legal Requirements. The Committee may
require each person acquiring shares of Stock pursuant to a Stock Award to
represent to and agree with the Company in writing that such person is acquiring
the shares without a view to distribution thereof. No shares of Stock shall be
issued pursuant to a Stock Award until all applicable securities law and other
legal and stock exchange requirements have been satisfied. The Committee may
require the placing of such stop-orders and restrictive legends on certificates
for Stock and Stock Awards as it deems appropriate.
B. Notices; Delivery of Stock Certificates. Any notice required or
permitted to be given by the Company or the Committee pursuant to the Plan shall
be deemed given when personally delivered or deposited in the United States
mail, registered or certified, postage prepaid, addressed to the Non-Employee
Director at the last address shown for the Non-Employee Director on the records
of the Company. Delivery of stock
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<PAGE> 26
certificates to persons entitled to receive payments under the Plan shall be
deemed effected for all purposes when the Company or a share transfer agent of
the Company shall have deposited such certificates in the United States mail,
addressed to such person at his last known address on file with the Company.
C. Nontransferability of Rights. During a Non-Employee Director's
lifetime, any payment under the Plan shall be made only to him. No sum or other
interest under the Plan shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any
attempt by a Non-Employee Director or any beneficiary under the Plan to do so
shall be void. No interest under the Plan shall in any manner be liable for or
subject to the debts, contracts, liabilities, engagements, or torts of a Non-
Employee Director or beneficiary entitled thereto.
D. Company's Obligations to Be Unfunded and Unsecured. The Accounts
maintained under the Plan shall at all times be entirely unfunded, and no
provision shall at any time be made with respect to segregating assets of the
Company (including Stock) for payment of any amounts hereunder. No Non-Employee
Director or other person shall have any interest in any particular assets of the
Company (including Stock) by reason of the right to receive payment under the
Plan, and any Non-Employee Director or other person shall have only the rights
of a general unsecured creditor of the Company with respect to any rights under
the Plan.
E. Governing Law. The terms of the Plan shall be governed, construed,
administered, and regulated in accordance with the laws of the Commonwealth of
Massachusetts. In the event any provision of this Plan shall be determined to be
illegal or invalid for any reason, the other provisions shall continue in full
force and effect as if such illegal or invalid provision had never been included
herein.
F. Effective Date of Plan. The Plan shall become effective as of October
1, 1994, subject to approval by the holders of a majority of the shares of
Capital Stock of the Company present or represented and entitled to vote at a
meeting of the shareholders.
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PROXY
DYNATECH CORPORATION
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints JOHN F. RENO and ROBERT H. HERTZ, and
each of them, proxies with full power of substitution to vote as set forth
below and in their discretion upon such other matters as may properly come
before the meeting, for and on behalf of the undersigned all the shares of
common stock of DYNATECH CORPORATION held of record by the undersigned at the
close of business on June 12, 1995, at the Annual Meeting of Stockholders to
be held in the Goodwin, Procter & Hoar Conference Center, 2nd Floor, Exchange
Place, Boston, Massachusetts, on Thursday, July 27, 1995 at 10:00 a.m., and at
any adjournments or postponements thereof, hereby granting full power and
authority to act on behalf of the undersigned at said meeting or any
adjournments or postponements thereof.
WHEN PROPERLY EXECUTED THIS PROXY WILL BE VOTED AS SPECIFIED BUT IF NO
SPECIFICATION IS MADE IT WILL BE VOTED FOR PROPOSAL 1, THE ELECTION OF ALL
NOMINEES LISTED ON THE REVERSE SIDE, FOR PROPOSAL 2, THE APPROVAL TO INCREASE
AUTHORIZED COMMON STOCK BY 26,000,000 ADDITIONAL SHARES, FOR PROPOSAL 3, THE
APPROVAL OF AMENDMENT TO THE 1994 STOCK OPTION AND INCENTIVE PLAN, FOR PROPOSAL
4, THE APPROVAL OF THE NON-EMPLOYEE DIRECTORS' STOCK COMPENSATION PLAN, AND IN
THE DISCRETION OF THE PERSONS NAMED AS PROXIES AS TO SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF.
------------
SEE REVERSE
PLEASE DATE AND SIGN ON REVERSE SIDE AND MAIL YOUR PROXY SIDE
CARD PROMPTLY IN THE ENCLOSED ENVELOPE ------------
/X/ PLEASE MARK
VOTES AS IN
THIS EXAMPLE
- --------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
PROPOSALS 1, 2, 3, AND 4.
- --------------------------------------------
<TABLE>
<S> <C>
1. To fix the number of Directors at eight and to 2. To approve the increase in the authorized FOR AGAINST ABSTAIN
elect Directors for a term expiring in Common Stock by 26,000,000 additional shares / / / / / /
1998 (as set forth in the Proxy Statement). (as set forth in the Proxy Statement).
Nominees: O. Gene Gabbard, Richard K. Lochridge,
Ronald L. Bittner
FOR WITHHELD 3. To approve the Amendment to the 1994 Stock FOR AGAINST ABSTAIN
ALL FROM ALL Option and Incentive Plan (as set forth in / / / / / /
NOMINEES ALL NOMINEES the Proxy Statement).
/ / / /
4. To approve the Non-Employee Directors' Stock FOR AGAINST ABSTAIN
______________________________________________________ Compensation Plan (as set forth in the Proxy / / / / / /
For, except vote withheld from the above nominee(s). Statement).
The undersigned hereby revokes any proxy previously given and
acknowledges receipt of the Notice of Annual Meeting, Proxy Statement,
and 1995 Annual Report of the Company which either accompanied or
preceded this proxy. This proxy may be revoked at any time before it is
exercised.
MARK HERE MARK HERE
FOR ADDRESS / / IF YOU PLAN / /
CHANGE AND TO ATTEND
NOTE AT LEFT THE MEETING
Sign exactly as name appears in stencil. When signing as Executor,
Administrator, Trustee, or Guardian, etc., please add full title.
This proxy votes all shares held in all capacities.
Signature: __________________________________________ Date ___________
Signature: __________________________________________ Date ___________
Title:_______________________________________________
</TABLE>
