<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
BancTec, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
BancTec, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
[LOGO OF BANCTEC, INC.]
4435 SPRING VALLEY ROAD
DALLAS, TEXAS 75244
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 22, 1996
Notice is hereby given that the Annual Meeting of Stockholders of BancTec,
Inc., a Delaware corporation (the "Company"), will be held at Texas Commerce
Bank Tower, Fourth Floor Boardroom, 2200 Ross Avenue, Dallas, Texas on May 22,
1996, at 10:00 a.m., Dallas, Texas time for the following purposes:
(i) To elect three directors;
(ii) To approve the BancTec, Inc. 1996 Employee Stock Purchase Plan;
(iii) To transact such other business as may properly come before the
meeting or any adjournment(s) thereof.
The accompanying Proxy Statement contains information regarding, and a more
complete description of, the items of business to be considered at the
meeting.
Only stockholders of record at the close of business on April 12, 1996, are
entitled to notice of, and to vote at, the Annual Meeting of Stockholders or
any adjournment(s) thereof.
You are cordially invited and urged to attend the meeting, but if you are
unable to attend, you are requested to sign and date the accompanying proxy
and return it promptly in the enclosed self-addressed envelope. If you attend
the meeting, you may vote in person, if you wish, whether or not you have
returned your proxy. In any event, a proxy may be revoked at any time before
it is exercised.
By Order of the Board of Directors
Tod V. Mongan
Senior Vice President,
General Counsel and
Secretary
Dallas, Texas
April 22, 1996
<PAGE>
LOGO
4435 SPRING VALLEY ROAD
DALLAS, TEXAS 75244
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 22, 1996
This Proxy Statement is sent to stockholders of BancTec, Inc., a Delaware
corporation (the "Company"), in connection with the solicitation of proxies by
the Board of Directors of the Company (the "Board") for use at the Annual
Meeting of Stockholders of the Company, and any adjournment(s) thereof (the
"Meeting"), to be held on May 22, 1996, at 10:00 a.m., Dallas, Texas time at
Texas Commerce Bank Tower, Fourth Floor Boardroom, 2200 Ross Avenue, Dallas,
Texas for the purposes set forth in the accompanying Notice of Annual Meeting
of Stockholders. Solicitation of proxies may be made in person or by mail,
telephone, or telegraph by directors, officers, and regular employees of the
Company. The Company has also retained Chemical Mellon Shareholder Services to
solicit stockholders in connection with the matters to be presented at the
Meeting for a fee not to exceed $3,750 plus reimbursement of certain expenses.
The Company may also request banking institutions, brokerage firms,
custodians, nominees, and fiduciaries to forward solicitation materials to the
beneficial owners of Common Stock of the Company held of record by such
persons, and the Company will reimburse the forwarding expenses. The cost of
solicitation of proxies will be paid by the Company. This Proxy Statement was
first mailed to stockholders on or about April 22, 1996.
The Company's Transition Report on Form 10-K covering the nine month period
from March 27, 1995 through December 31, 1995 ("Fiscal 1995A"), including
audited financial statements, is enclosed herewith. Such Transition Report on
Form 10-K does not form any part of the material for the solicitation of
proxies.
Any stockholder returning the accompanying proxy may revoke such proxy at
any time prior to its exercise: (i) by giving written notice to the Company of
such revocation; (ii) by voting in person at the Meeting; or (iii) by
executing and delivering to the Company a later dated proxy.
The voting securities of the Company are shares of its Common Stock, $.01
par value ("Common Stock"), each share of which entitles the holder thereof to
one vote. On April 12, 1996, there were outstanding and entitled to vote
20,243,777 shares of Common Stock. Only stockholders of record at the close of
business on April 12, 1996, are entitled to notice of, and to vote at, the
Meeting.
The presence, in person or by proxy, of the holders of a majority of the
outstanding shares of Common Stock entitled to vote is necessary to constitute
a quorum at the Meeting. If a quorum is not present or represented at the
Meeting, the stockholders entitled to vote thereat, present in person or
represented by proxy, have the power to adjourn the Meeting from time to time,
without notice other than an announcement at the Meeting, until a quorum is
present or represented. At any such adjourned Meeting at which a quorum is
present or represented, any business may be transacted that might have been
transacted at the original Meeting. Abstentions and broker non-votes are each
included in the determination of the number of shares present for purposes of
a quorum, but will not be counted as votes in favor of a proposal.
Cumulative voting is not permitted in the election of directors of the
Company. On all matters (including election of directors) submitted to a vote
of the stockholders at the Meeting, each stockholder will be entitled to
<PAGE>
one vote for each share of Common Stock owned of record by such stockholder at
the close of business on April 12, 1996.
Proxies in the accompanying form, if properly executed and returned, will be
voted at the Meeting in accordance with the instructions thereon. Any proxy
upon which no instructions have been indicated with respect to any of the
following matters will be voted as follows: (i) "FOR" the election of the
three persons named in this Proxy Statement as the Board's nominees for
election to the Board; (ii) "FOR" approval of the BancTec, Inc. 1996 Employee
Stock Purchase Plan (the "1996 Plan"); and (iii) in accordance with the
discretion of the holders of such proxies with respect to any other business
that properly comes before the stockholders at the Meeting. The Board knows of
no matters, other than those stated above, to be presented for consideration
at the Meeting. If, however, other matters properly come before the Meeting,
it is the intention of the persons named in the accompanying proxy to vote
such proxy in accordance with their judgment on any such matters. The persons
named in the accompanying proxy may also, if it is deemed to be advisable,
vote such proxy to adjourn the Meeting from time to time.
ELECTION OF DIRECTORS
The directors of the Company have been divided into three classes. The
members of each class serve for three years. Pursuant to the Company's bylaws,
the Board has fixed the number of directors at nine. Three of the nine
directors' terms expire this year. The term of office for each director shall
be until the year following each nominee's name below or until a successor is
elected and qualified. Directors are elected by a plurality of the votes of
shares of Common Stock present in person or by proxy and entitled to vote at
the Meeting.
The Board recommends a vote FOR the election of the following nominees to be
elected for a term expiring in 1999:
<TABLE>
<CAPTION>
NAME AGE POSITION
----------------------------- --- ---------------------------------------
<C> <C> <S>
Grahame N. Clark, Jr......... 53 Chairman, President and Chief Executive
Officer and Director
A.A. Meitz................... 58 Director
Michael A. Stone............. 59 Director
The following directors are presently serving unexpired terms, ending the
year following such director's name:
<CAPTION>
NAME AGE POSITION
----------------------------- --- ---------------------------------------
<C> <C> <S>
Michael E. Faherty (1997).... 60 Director
Paul J. Ferri (1997)......... 57 Director
Rawles Fulgham (1998)........ 68 Director
Thomas G. Kamp (1998)........ 70 Director
Norton A. Stuart, Jr. (1998). 61 Director
Merle J. Volding (1997)...... 72 Director
</TABLE>
Mr. Clark has been a director of the Company since September 1985. Mr. Clark
has been Chairman and Chief Executive Officer of the Company since April 1987
and President since September 1995. Mr. Clark also serves as a director of El
Chico Restaurants, Inc. (owner and franchiser of El Chico and other Tex-Mex
style Mexican restaurants) and The Dyson-Kissner-Moran Corporation (a private
investment company).
Mr. Meitz has been a director of the Company since November 1995. Mr. Meitz
was formerly with the firm of Booz-Allen & Hamilton, Inc. (an international
management and technology consulting firm) for more than 25 years and was a
Senior Vice President until he elected retirement in August 1994. Mr. Meitz
also served as a member of the Booz-Allen Board of Directors and Chairman of
its Audit Committee. The majority of his work has focused on issues of
business strategy, marketing and organization design. In addition, Mr. Meitz
served as a director of Recognition International Inc. until October 1995.
Presently, Mr. Meitz serves as a director of Associated Materials Incorporated
(a building products company), Northern Trust Bank of Texas (a subsidiary of
Northern Trust Bank of Illinois), Greyhound Lines Inc. (a transportation
company), and ComStream Corp. (a satellite communications business).
2
<PAGE>
Mr. Stone has been a director of the Company since January 1979. Since March
1985, Mr. Stone has been general partner of Davis Venture Group, L.P., the
general partner of Davis Venture Partners, L.P. (a venture capital
partnership).
Mr. Faherty has been a director of the Company since September 1984. Since
1977, Mr. Faherty has been president of MICO, Inc., a family-owned consulting
and contract executive business. As part of the contract executive business,
Mr. Faherty from time to time serves as a corporate officer of companies.
Currently, he is serving as chairman and CEO of eccs inc. (a manufacturer of
mass storage subsystems and an integrator of systems utilizing such
subsystems). Mr. Faherty also serves as a director of eccs inc. and of
Frontier Corporation (a provider of telecommunication services).
Mr. Ferri has been a director of the Company since September 1978. Mr. Ferri
has been managing general partner in Matrix Partners I, II, III, and IV, L.P.
(venture capital investment partnerships) since January 1982, August 1985,
March 1990 and January 1995, respectively. In addition, Mr. Ferri is a
director of Applix, Inc. (real time decision support software), Atria
Software, Inc. (software configuration management), and Cascade Communications
Corp. (frame relay data communications products), Stratus Computer, Inc.
(fault tolerant computer systems), Techforce Corp. (integrated network support
solutions), and Video Server Inc. (video teleconferencing).
Mr. Fulgham has been a director of the Company since June 1982. Since
September 1989, Mr. Fulgham has served as senior advisor of Merrill Lynch &
Co., Inc. From August 1982 to September 1989, Mr. Fulgham was executive
director of Merrill Lynch Private Capital Inc. In addition, Mr. Fulgham
presently serves on the Advisory and Audit Committee of Dorchester Hugoton,
Ltd. (engaged in development, production and processing of natural gas) and as
a director of Dresser Industries, Inc. (a supplier to energy-related
companies), NCH Corporation (a manufacturer of products used in maintenance
applications), Republic Financial Services, Inc. (a provider of fire and
casualty life insurance) and Global Technologies, Inc. (a provider of products
for industrial production and infrastructure development).
Mr. Kamp has been a director of the Company since June 1982. Mr. Kamp served
as chairman of the board of Premier Computer Corporation (a disk drive
remanufacturer) from 1985 to 1990, and also served as chairman of the board of
Rodime, Inc. (a disk drive manufacturer) from 1989 to 1991. Mr. Kamp was vice
chairman of Control Data Corporation until December 1984 and chairman of
Centronics Data Computer Corporation (a holding company) from January 1985
until January 1988.
Mr. Stuart has been a director of the Company since February 1986. Mr.
Stuart served as President of the Company from April 1987 to September 1995.
Mr. Volding has been a director of the Company since December 1971. From
April 1987 to April 1989, Mr. Volding was Chairman of the Executive Committee
of the Company. From October 1985 to April 1987, Mr. Volding was Chairman of
the Board of the Company. Mr. Volding served as President and Chief Executive
Officer of the Company from March 1974 to October 1985. Mr. Volding also
serves as a director of Computer Language Research, Inc. (a developer of
proprietary software systems).
Should any nominee named herein for the office of director become unable or
unwilling to accept nomination or election, it is intended that the persons
acting under the proxy will vote for the election, in his stead, of such other
person as the Board may recommend. The Board has no reason to believe that any
nominee named above will be unable or unwilling to serve if elected.
MEETINGS AND COMMITTEES OF THE BOARD
The Board held six meetings in Fiscal 1995A, and each director attended at
least 75% of the aggregate of (i) the total number of meetings of the Board
held during the period for which he served as a director and (ii) the total
number of meetings held by all committees of the Board on which he served.
3
<PAGE>
The Board does not have a standing nominating committee or a committee
performing similar functions. Nominees to the Board are selected by the entire
Board.
The Board has an Option Committee (herein so called), which is composed of
Michael A. Stone, Michael E. Faherty, Paul J. Ferri, Rawles Fulgham, Thomas G.
Kamp, A.A. Meitz, and Merle J. Volding. The Option Committee administers the
Company's stock option plans. The Option Committee held four meetings during
Fiscal 1995A.
The Board has a Compensation Committee (herein so called), which is composed
of Michael E. Faherty, Paul J. Ferri, Rawles Fulgham, Thomas G. Kamp, A.A.
Meitz, and Michael Stone. The Compensation Committee reviews and makes
recommendations regarding compensation and other employment benefits of
officers and employees of the Company. The Compensation Committee held two
meetings during Fiscal 1995A.
The Board has an Audit Committee (herein so called), which is composed of
Michael E. Faherty, Paul J. Ferri, Rawles Fulgham, Thomas G. Kamp, A.A. Meitz,
Michael A. Stone, and Merle J. Volding. The Audit Committee reviews the
Company's financial results, recommends the appointment of the Company's
outside auditors, reviews the scope and results of audits, and reviews internal
accounting controls. The Audit Committee held three meetings during Fiscal
1995A.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding compensation
earned during Fiscal 1995A and the fiscal years ended March 27, 1995 ("Fiscal
1995") and March 27, 1994 ("Fiscal 1994"), by the Company's Chief Executive
Officer and each of the Company's four other most highly compensated executive
officers (based upon salary and bonus earned during Fiscal 1995A). All
information relating to shares of Common Stock and options to purchase Common
Stock contained herein have been adjusted to reflect the three-for-two stock
split of Common Stock effected in February 1993.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION AWARDS
---------------------- -------------------------------
FISCAL RESTRICTED STOCK
NAME AND PRINCIPAL POSITION(S) YEAR SALARY ($) BONUS($)(1) AWARD(S) ($) OPTIONS (#)(2)
- ------------------------------ ------ ---------- ----------- ---------------- --------------
<S> <C> <C> <C> <C> <C>
Grahame N. Clark, Jr..... 1995A 198,835 165,106 -0- 81,000
Chairman and Chief Exec-
utive Officer 1995 256,877 -0- 35,035(3) 20,000
1994 256,849 198,645 392,364 40,000
William E. Bassett....... 1995A 132,183 88,638 -0- 11,500
Executive Vice Presi-
dent; President, 1995 171,083 -0- 14,674(4) 3,500
BancTec USA, Inc. 1994 169,337 83,261 12,224 15,000
John G. Guthrie.......... 1995A 123,249 76,978 -0- 5,500
Senior Vice President 1995 161,022 -0- 9,278(5) 3,500
1994 71,421 34,960 -0- 15,000
Norton A. Stuart......... 1995A 99,687 76,609 -0- 6,500
President 1995 187,383 -0- 19,860(6) 5,000
1994 186,924 112,651 19,703 10,000
Tod V. Mongan............ 1995A 95,996 59,735 97,219 33,500
Senior Vice President,
General Counsel 1995 120,484 -0- 10,693(7) 5,000
and Secretary 1994 118,480 60,631 8,934 15,000
</TABLE>
- --------
(1) Reflects bonus earned during the fiscal year. In some instances, all or a
portion of the bonus was paid during the next fiscal year.
(2) Options to acquire shares of Common Stock.
(3) On December 31, 1995, Mr. Clark held 29,309 shares of restricted Common
Stock granted under the 1989 Plan with a value of $542,226 based upon the
last sales price of Common Stock reported on the NYSE on December 29, 1995,
the last trading day of Fiscal 1995A. Of these 29,309 shares of restricted
stock, 7,944
4
<PAGE>
shares vest, in whole or in part, within three years of the date of grant
and the remaining shares of restricted stock will vest beyond three years
from the date of grant. Of such 7,944 shares, 2,120 will vest on April 1,
1996, 513 will vest on May 17, 1996, 557 will vest on May 27, 1996, 2,120
will vest on April 1, 1997, 514 shares will vest on May 17, 1997, and 2,120
will vest on April 1, 1998. Dividends, if any, paid on Common Stock will be
paid on shares held as restricted stock.
(4) On December 31, 1995, Mr. Bassett held 5,529 shares of restricted Common
Stock granted under the 1989 Plan with a value of $102,287 based upon the
last sales price of Common Stock reported on the NYSE on December 29,
1995, the last trading day of Fiscal 1995A. Of these 5,529 shares of
restricted stock, 643 shares will vest, in whole or in part, within three
years of the date of grant and the remaining shares of restricted stock
will vest beyond three years from the date of grant. Of such 643 shares,
213 will vest on May 27, 1996, 215 will vest on each of May 17, 1996 and
May 17, 1997. Dividends, if any, paid on Common Stock will be paid on
shares held as restricted stock.
(5) On December 31, 1995, Mr. Guthrie held 278 shares of restricted Common
Stock granted under the 1989 Plan with a value of $5,143 based upon the
last sales price of Common Stock reported on the NYSE on December 29,
1995, the last trading day of Fiscal 1995A. Of these 278 shares of
restricted stock, 139 shares will vest on April 1, 1996, and 139 shares
will vest on April 1, 1997. Dividends, if any, paid on Common Stock will
be paid on shares held as restricted stock.
(6) On December 31, 1995, Mr. Stuart held 925 shares of restricted Common
Stock granted under the 1989 Plan with a value of $17,131 based upon the
last sales price of Common Stock reported on the NYSE December 29, 1995,
the last trading day of Fiscal 1995A. Of these 925 shares of restricted
stock, 291 shares will vest on May 17, 1996, 344 shares will vest on May
27, 1996, and 291 shares will vest on May 17, 1997. Dividends, if any,
paid on Common Stock will be paid on shares held as restricted stock. On
September 27, 1995, Mr. Stuart ceased serving as President of the Company.
(7) On December 31, 1995, Mr. Mongan held 15,451 shares of restricted Common
Stock granted under the 1989 Plan with a value of $285,844 based upon the
last sales price of Common Stock reported on the NYSE on December 29,
1995, the last trading day of Fiscal 1995A. Of these 15,451 shares of
restricted stock, 1,634 shares of restricted stock will vest, in whole or
in part, within three years of the date of grant and the remaining shares
of restricted stock will vest beyond three years from the date of grant.
Of such 1,634 shares of restricted stock, 157 will vest on May 17, 1996,
156 will vest on May 27, 1996, 388 will vest on June 30, 1996, 157 will
vest on May 17, 1997, 388 will vest on June 30, 1997, and 388 will vest on
June 30, 1998. Dividends, if any, paid on Common Stock will be paid on
shares held as restricted stock.
5
<PAGE>
OPTION GRANTS IN FISCAL 1995A
The following table sets forth information related to options granted to the
named executive officers during Fiscal 1995A.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM(1)
- -------------------------------------------------------------------------------- ---------------------
PERCENT OF TOTAL
OPTIONS OPTIONS GRANTED TO EXERCISE OR
GRANTED EMPLOYEES IN BASE PRICE EXPIRATION
NAME (#)(2) FISCAL YEAR(%) ($/SH)(3) DATE 5% ($) 10% ($)
---- ------- ------------------ ----------- ---------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Grahame N. Clark, Jr.... 5,000 .93 15.38 May 25, 2001 26,153 59,333
76,000 14.13 19.98 November 7, 2001 516,428 1,171,600
William E. Bassett...... 1,500 .28 15.38 May 25, 2001 7,846 17,800
10,000 1.86 19.98 November 7, 2001 67,951 154,158
John G. Guthrie......... 5,000 .93 15.38 May 25, 2001 26,153 59,333
500 .09 19.98 November 7, 2001 3,397 7,708
Norton A. Stuart, Jr.... 1,500 .28 15.38 May 25, 2001 7,846 17,800
5,000 .93 19.98 November 7, 2001 33,976 77,079
Tod V. Mongan........... 3,500 .65 15.38 May 25, 2001 18,307 41,533
30,000 5.58 19.98 November 7, 2001 203,853 462,474
</TABLE>
- --------
(1) The potential realizable value portion of the foregoing table illustrates
the value that might be realized upon exercise of the options immediately
prior to the expiration of their term, assuming the specified compound
rates of appreciation of the Common Stock over the term of the options.
These amounts do not take into account provisions of certain options
providing for termination of the options following termination of
employment, nontransferability, or vesting periods of up to five years.
These amounts represent certain assumed rates of appreciation only. Actual
gains on stock option exercises are dependent on the future performance of
the Common Stock and overall stock market conditions. There can be no
assurance that the potential values reflected in this table will be
achieved. All amounts have been rounded to the nearest whole dollar
amount.
(2) Options to acquire shares of Common Stock, which were granted on May 25,
1995 and November 7, 1995, under the 1989 Plan. The options will vest
ratably over five years beginning one year after the date of grant.
(3) The option exercise price may be paid in shares of Common Stock owned by
the executive officer, in cash, or a combination of either of the
foregoing, as approved by the Option Committee in its discretion.
6
<PAGE>
AGGREGATED OPTION EXERCISES IN FISCAL 1995A
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information related to the number of options
exercised in Fiscal 1995A and the value realized by the named executive
officers. Further, the table provides information related to the number and
value of options held by the named executive officer at the end of Fiscal
1995A.
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
IN-THE-MONEY
NUMBER OF UNEXERCISED OPTIONS AT
OPTIONS AT FISCAL YEAR-END FISCAL YEAR-END(1)
SHARES ACQUIRED VALUE ------------------------------- -------------------------------
NAME ON EXERCISE(#) REALIZED($)(2) EXERCISABLE(#) UNEXERCISABLE(#) EXERCISABLE($) UNEXERCISABLE($)
---- --------------- -------------- -------------- ---------------- -------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Grahame N. Clark, Jr.... -0- -0- 107,500 197,750 664,020 360,370
William E. Bassett...... -0- -0- 52,650 58,650 351,282 128,872
John G. Guthrie......... -0- -0- 9,960 28,730 35,920 36,869
Norton A. Stuart, Jr.... -0- -0- 47,235 35,500 438,673 88,420
Tod V. Mongan........... -0- -0- 32,100 70,450 192,492 135,862
</TABLE>
- --------
(1) The last sales price of Common Stock as reported on the NYSE on December
29, 1995, the last trading day of Fiscal 1995A, was $18.50. Value is
calculated on the basis of the remainder of $18.50 minus the exercise
price multiplied by the number of shares of Common Stock underlying the
option.
(2) Value is calculated based on the remainder of the closing market price of
Common Stock on the date of the exercise minus the exercise price
multiplied by the number of shares to which the exercise relates.
COMPENSATION OF DIRECTORS
Each director who is not an employee of the Company is entitled to receive
compensation in the amount of $20,000 per year plus a fee of $1,000 for each
day on which he attends a meeting of the Board or a meeting of a committee of
the Board, if the committee meeting is not held on the same day as a Board
meeting.
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements (the "Agreements") with
Grahame N. Clark, Jr., Norton A. Stuart, Jr., Tod V. Mongan, and Raghavan
Rajaji. Each of the Agreements provides for the payment of base salary amounts
and the participation in any employee benefit or bonus plan or arrangement
made available by the Company on a basis consistent with the terms,
conditions, and overall administration of such plan or arrangement. The term
of Mr. Stuart's Agreement is five years from May 28, 1992. The Agreements for
Messrs. Clark and Mongan expire on November 7, 2000 and Mr. Rajaji's Agreement
expires on September 27, 2000.
Upon the death of an executive during the term of that executive's
Agreement, the Company is obligated to pay the executive's base salary for a
period of months (not to exceed twelve months) determined by multiplying two
times the number of complete twelve-month periods of employment of the
executive with the Company. Each Agreement provides that if the executive's
employment is terminated (whether such termination is by the executive or by
the Company) within three years after a Triggering Event (which, generally
speaking, is defined in the Agreement as a change in control of the Company)
for any reason other than (i) termination by the Company for cause (as defined
in the Agreement), (ii) the executive having reached the age of 65, or (iii)
the executive's death, the Company is obligated to make a lump sum cash
payment equal to 2.99 times the average of the executive's annualized
includable compensation (as defined in the Agreement) received from the
Company during the period consisting of the five full taxable years ending
immediately preceding the Triggering Event. The Company is obligated to
transfer to an irrevocable trust upon the occurrence of a Triggering Event, or
as soon thereafter as the Company knows of the Triggering Event, the amount of
cash that the Company would be obligated to pay under the Agreement if such
executive's employment were terminated on that date.
7
<PAGE>
COMPENSATION COMMITTEE AND OPTION COMMITTEE INTERLOCKS AND INSIDER
PARTICIPATION
During Fiscal 1995A, the Compensation Committee was composed of Michael E.
Faherty, Paul J. Ferri, Rawles Fulgham, Thomas G. Kamp, A.A. Meitz (from
November 1995) and Michael A. Stone and the Option Committee was composed of
Michael E. Faherty, Paul J. Ferri, Rawles Fulgham, Thomas G. Kamp, A.A. Meitz
(from November 1995), Michael A. Stone, and Merle J. Volding. See "Election of
Directors" and "Meetings and Committees of the Board." No member of the
Compensation Committee or the Option Committee is an officer of the Company.
No member of the Compensation Committee or the Option Committee was formerly
an officer of the Company except for Mr. Volding, a member of the Option
Committee, who was formerly an officer of the Company.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee is responsible for setting and administering the
policies governing annual compensation of the executive officers of the
Company. These policies are based upon the philosophy that the Company's long-
term success is best achieved through recruitment and retention of the best
people in the industry. The Compensation Committee applies this philosophy in
determining compensation for the Company's executive officers in three areas:
salary; bonuses; and stock options and awards.
Base Salary. The Company strives to offer salaries to its executive officers
which are competitive in its industry for similar positions requiring similar
qualifications. In determining executive officers' salaries, the Compensation
Committee considers information provided by Hewitt Associates and from
published salary surveys specific to the Company's industry, size, and
geographic location.
The executive officers' base salaries are targeted at slightly below the
median as indicated in the salary surveys. Base salaries are reviewed bi-
annually to determine if adjustments are necessary based upon competitive
practices and economic conditions. In addition, executive officers' salaries
are periodically adjusted based on individual performance and changes in job
content and responsibilities.
The Compensation Committee evaluates the performance and sets the salary of
the Company's Chairman and Chief Executive Officer, Grahame N. Clark, Jr. Mr.
Clark does not participate in any discussions of the Compensation Committee
regarding his salary or performance. Mr. Clark evaluates the performance of
all other executive officers, and recommends salary adjustments which are
reviewed and acted upon by the Compensation Committee. Performance evaluations
for individual executive officers are based on achievement of predetermined
individual goals. For Mr. Clark, these goals are set by the Compensation
Committee, and for all other officers, these goals are set by Mr. Clark.
Bonuses. The Company seeks to provide additional incentives and rewards to
executives who make contributions of outstanding value to the Company. For
this reason, the Compensation Committee administers a bonus plan, which can
comprise a substantial portion of the total compensation of executive officers
when earned and paid. It is the intention of the Compensation Committee to
weight the total compensation of the executive officers heavily in the area of
incentive compensation. The Compensation Committee believes that optimal
performance is encouraged through the use of incentive programs, furthering
the goal of having performance compensation as an important component of total
executive compensation.
In consultation with the Chairman, the Compensation Committee determines
annually the total amount of cash bonuses available for executive officers.
Awards under the plan are contingent upon the performance of the Company as a
whole, based upon the Company attaining certain financial and operational
goals set by the Board annually in consultation with the Chairman. The target
amounts of bonus available are set annually by the Compensation Committee with
regard to Mr. Clark and by Mr. Clark, subject to review and approval by the
Compensation Committee, with regard to executive officers other than Mr.
Clark. In all cases the target amounts for individual officers are based upon
such officer's individual goals and objectives and the goals and objectives
established for the particular operating unit such officer is responsible for
managing. Executive officers earn a
8
<PAGE>
percentage of the target amounts under the bonus plan based on the achievement
of these performance goals and objectives as determined annually by the
Compensation Committee and a percentage based on the Company's attainment of
the pre-tax goals. Awards are weighted so that proportionately higher awards
are received when the Company's performance exceeds targets and proportionately
smaller or no awards are made when the Company does not meet targets.
Stock Options. The Compensation Committee believes that employee equity
participation provides significant additional motivation to executive officers
to maximize value for the Company's stockholders, and therefore recommends to
the Option Committee periodic grants of stock options under the 1989 Plan.
Stock options are approved by the Option Committee, based on the recommendation
of the Compensation Committee, with exercise prices at the prevailing market
price at date of grant. The stock options will have value only if the Company's
stock price increases over the exercise price. Therefore, the Compensation
Committee believes that stock options serve to align the interest of executive
officers closely with the other stockholders because of the direct benefit
executive officers receive through improved stock performance.
The Compensation Committee makes recommendations to the Option Committee
concerning the size and frequency of option grants for executive officers,
after consideration of recommendations from the Chairman. Recommendations for
options are based upon relative position and responsibilities of each executive
officer, historical and expected contributions of each officer to the Company,
and previous option grants to such executive officers within the Company.
Generally, option grants vest over five years and expire six years from date of
grant. Option grants for Fiscal 1995A are set forth in the table entitled
"Option Grants in Fiscal 1995A."
Restricted Stock. The Company has implemented the use of restricted stock in
order to further the goal of having its executive officers maintain a "stake"
in the long-term success of the Company, through equity ownership, as well as
encouraging long-term employment with the Company. Restricted awards are given
to executive officers in lieu of base salary increases and in lieu of a fixed
percentage of the available bonus for each fiscal year.
Each time an executive officer's base salary is increased such executive
officer must take a minimum of 50% of such increase as a restricted stock
award. It is such officer's option to take up to the entire amount of such
increase as a restricted stock award but in no event can the percentage fall
below 50%. The amount of restricted stock awarded is based on the base salary
increase, the percentage to be taken in stock, the number of years remaining
until such officer reaches sixty years of age, and the closing price of the
Company's Common Stock on the day of the award. This restricted stock award
vests in equal annual installments over the number of years remaining until
such officer attains the age of sixty.
Executive officers are required to take 15% of their annual incentive bonus,
if any, in the form of a restricted stock award. The number of shares of
restricted stock awarded is based upon the closing price of the Company's
Common Stock on the date the incentive bonus is approved by the Compensation
Committee. The restricted stock awarded to each executive officer vests over a
period of three years.
COMPENSATION COMMITTEE
Michael E. Faherty
Paul J. Ferri
Rawles Fulgham
Thomas G. Kamp
A.A. Meitz
Michael A. Stone
9
<PAGE>
PERFORMANCE GRAPH
The following chart compares the yearly percentage change in the cumulative
total stockholder return of the Company's Common Stock during the five fiscal
years ended December 31, 1995, with the yearly change in cumulative total
return of the New York Stock Exchange Composite Index and Standard and Poors
(S&P) Computer Software and Services Industry Group Index. The comparison
assumes that $100 was invested on March 31, 1991, in the Company's Common
Stock and in each of the foregoing indices and assumes reinvestment of
dividends.
In filings covering periods through March 26, 1995, the broad equity market
index used for comparison purposes was the NASDAQ Total Market Index. Since
December 28, 1995, the Company has been listed on the New York Stock Exchange
(NYSE). Accordingly, the broad equity market index used for comparison
purposes has been changed to the NYSE Composite Index with this filing. The
NASDAQ Total Market Index is also presented here in accordance with Securities
and Exchange Commission regulations.
COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN
AMONG BANCTEC, NASDAQ STOCK MARKET,
NYSE COMPOSITE AND S&P SOFTWARE & SERVICE
PERFORMANCE GRAPH APPEARS HERE
<TABLE>
<CAPTION>
S&P
Measurement Period Nasdaq NYSE Software
(Fiscal Year Covered) BancTec, Inc. Stock Mkt Composite & Service
- --------------------- --------------- --------- ---------- ---------
<S> <C> <C> <C> <C>
Measurement Pt-03/31/1991 $100 $100 $100 $100
FYE 03/29/1992 $175 $128 $109 $135
FYE 03/28/1993 $190 $145 $121 $170
FYE 03/27/1994 $266 $167 $120 $190
FYE 03/26/1995 $192 $174 $132 $261
FYE 12/31/1995 $209 $223 $161 $322
</TABLE>
10
<PAGE>
PROPOSAL TO APPROVE THE 1996 EMPLOYEE STOCK PURCHASE PLAN
GENERAL
On February 27, 1996, the Board adopted the 1996 Plan as a replacement for
the 1990 Employee Stock Purchase Plan. The Board of Directors has directed that
the 1996 Plan be submitted to the stockholders of the Company at the next
annual meeting of the stockholders for the ratification and approval of the
1996 Plan by a majority of the stockholders present in person, or represented
by proxy, and entitled to vote at the meeting, as required to qualify the 1996
Plan as an "employee stock purchase plan" pursuant to the provisions of Section
423 of the Internal Revenue Code of 1986, as amended (the "Code" ). If the 1996
Plan is not so approved by the stockholders of the Company within the 12 month
period immediately subsequent to the adoption of the 1996 Plan by the Board of
Directors, the 1996 Plan will not qualify for special tax treatment as an
employee stock purchase plan, and participating employees will realize income
upon the receipt of Common Stock after the exercise of an option granted under
the 1996 Plan. The description in this Proxy Statement of the 1996 Plan is
intended solely as a summary, does not purport to be complete, and is qualified
in its entirety by the full text of the 1996 Plan attached hereto as Exhibit A.
REASONS FOR THE 1996 PLAN
The 1996 Plan is intended to replace the 1990 Employee Stock Purchase Plan
(the "1990 Plan") which was originally approved by the stockholders on
September 5, 1990 and again on September 27, 1995 when the stockholders
approved an amendment increasing the number of shares authorized for issuance
under the 1990 Plan. If the 1996 Plan is approved by the stockholders, the 1990
Plan will be terminated. If the 1996 Plan is not approved, the 1996 Plan will
not become effective and the 1990 Plan will continue in effect.
The 1996 Plan is an arrangement which provides all eligible employees of the
Company and its domestic subsidiaries the opportunity to acquire a proprietary
interest in the Company, increasing their interest in the Company's welfare,
and encouraging them to remain in the employ of the Company or of its
subsidiaries.
The 1996 Plan is not subject to any of the provisions of the Employee
Retirement Income Security Act of 1974 and is not qualified under Section
401(a) of the Code.
Participation in the 1996 Plan is entirely voluntary. In deciding whether to
participate in the 1996 Plan, each eligible employee should understand that the
market price of Common Stock, or any stock, may decrease. While an individual
who buys Common Stock has an opportunity for profit, he also takes the risk of
loss. Not all eligible employees are necessarily in the financial position to
take the risk associated with the ownership of Common Stock. Therefore, each
eligible employee should carefully consider his or her personal financial
situation before deciding whether to participate in the 1996 Plan.
ADMINISTRATION OF THE 1996 PLAN
The 1996 Plan is administered by the Administration Committee, which consists
of all nonemployee members of the Board. The Administration Committee has full
power and authority to construe, interpret and administer the 1996 Plan and has
the full and exclusive right to establish the terms of each offering of Common
Stock pursuant to the provisions of the 1996 Plan. All actions taken and
determinations made by the Administration Committee pursuant to the provisions
of the 1996 Plan must be made by a majority of the members of the
Administration Committee and shall be conclusive. No member of the
Administration Committee is liable for any action taken or determination made
in good faith. No member of the Administration Committee is eligible to
participate in the 1996 Plan.
ELIGIBILITY
Participation in the 1996 Plan is available to all employees of the Company
or any of its subsidiaries, who have completed 90 continuous days of employment
with the Company or its subsidiaries by the first day of the
11
<PAGE>
Payroll Deduction Period (hereinafter defined) and whose customary employment
with the Company is at least twenty (20) hours per week and more than five
months in any calendar year. Officers and directors of the Company are eligible
to participate in the 1996 Plan.
Approximately 2,700 employees of the Company and its domestic subsidiaries
will be eligible to participate in the 1996 Plan.
STOCK OFFERINGS
The fiscal year of the 1996 Plan is the twelve-month period ending December
31. Each year in the first fifteen (15) days of the month of December, except
that the initial offering will be the period from June 1, 1996 to June 15,
1996, unless the Board of Directors of the Company determines otherwise, the
Company will offer to each eligible employee the opportunity to purchase Common
Stock of the Company through voluntary payroll deductions. Each eligible
employee will be entitled to purchase up to that number of full shares (not to
exceed 500 shares) which could be purchased at the option price determined as
of the date of grant of the options, with an amount equal to such percentage as
the Board of Directors may determine for any annual offering (but not to exceed
10%) of the eligible compensation which the eligible employee receives from the
Company during the twelve-month period during which deductions are made from
his pay ("Payroll Deduction Period").
The option price for each annual offering will be the lesser of 85% of the
fair market value of Common Stock on the date the option to purchase such stock
under the 1996 Plan is granted or 85% of the fair market value of the Common
Stock on the date the right to purchase such stock is exercised. Fair market
value, as of any applicable date, is the closing price of the Common Stock as
quoted on the New York Stock Exchange ("NYSE").
Subject to the terms and conditions and within the limitations of the 1996
Plan and Section 423 of the Code, the Committee may modify, extend or renew
outstanding options granted under the 1996 Plan or accept the surrender of
options outstanding under the 1996 Plan (to the extent not theretofore
exercised) and authorize the granting of a new option under the 1996 Plan in
substitution for an old option (to the extent not theretofore exercised). In
addition, the Committee may authorize and direct the substitution of a new
option or the assumption of an old option, granted by the Company to an
eligible employee under another employee stock purchase plan of the Company, to
the extent such option has not been exercised or terminated and other eligible
employees of the Company are granted similar rights and privileges.
ELECTION TO PARTICIPATE
Eligible employees who wish to participate must elect to do so by the end of
the offering period (the "Offering Period"), which is the first fifteen (15)
days of December each year, except that the initial offering period shall be
the period from June 1, 1996 to June 15, 1996. Each eligible employee's
election will indicate the percentage of his compensation with respect to which
he wishes to participate and will authorize payroll deductions, to be made over
the Payroll Deduction Period. A participant may authorize payroll deductions in
an amount of not less than one percent nor more than ten percent (in multiples
of one percent) of his compensation for the Payroll Deduction Period. A
participant may not alter his payroll deduction authorization during the
Payroll Deduction Period in order to authorize a greater or lesser payroll
deduction than he originally elected during the Offering Period. However, he
may cancel his payroll deduction authorization and participate only to the
extent of the number of shares for which options could be exercised with the
amount of payroll deductions previously made. In addition, at the end of the
Payroll Deduction Period, he may elect to exercise only part of the options
previously granted to him and receive a refund for the excess amounts deducted
from his pay.
An employee who is otherwise eligible to participate in the 1996 Plan may
waive such right to participate by declining, in writing, to authorize a
payroll deduction. This declination results in an irrevocable waiver of
participation only for the specific Payroll Deduction Period to which it
relates but shall not, in and of itself, adversely impact the right of the
eligible employee to participate in the 1996 Plan during any subsequent Payroll
Deduction Period in which he has not filed a written declination.
12
<PAGE>
RESTRICTIONS ON OPTIONS
Under the 1996 Plan, options may be granted only on shares of Common Stock of
the Company, and no more than 500,000 shares of Common Stock of the Company may
be sold pursuant to the exercise of options granted under the 1996 Plan,
subject to appropriate adjustments as described below. No fractional shares may
be issued under the 1996 Plan.
No eligible employee may be granted an option to purchase Common Stock under
the 1996 Plan in excess of 500 shares. No eligible employee will be granted an
option to purchase shares of Common Stock under the 1996 Plan if such employee,
immediately after the grant of the option, owns stock equal to five percent or
more of the total combined voting power or value of all classes of stock of the
Company, including the stock of the Company he has been granted options to
purchase. For purposes of determining the stock of the Company owned by an
eligible employee, such employee is deemed to own the Company stock owned by
such persons and entities described in Section 425(d) of the Code. No eligible
employee will be granted options to purchase Common Stock under the 1996 Plan
which permits him to accrue rights to purchase stock under all employee stock
purchase plans of the Company at a rate which exceeds $25,000 (or such other
maximum as may be prescribed from time to time by the Code) of fair market
value of such stock (determined at the time of the grant) for each calendar
year in which such rights are outstanding at any time in accordance with the
provisions of Section 423(b)(8) of the Code.
AMENDMENT AND TERMINATION OF THE 1996 PLAN
The Company may amend, alter, suspend or terminate the 1996 Plan at any time
and in any manner, except in any way that would adversely affect a
Participant's rights under an option previously granted to a participant. With
respect to certain amendments to the 1996 Plan, approval by the stockholders of
the Company of any such amendment to the 1996 Plan may be necessary in order to
satisfy the requirements of Section 423 of the Code and certain rules and
regulations promulgated thereunder. In the event that such approval by the
stockholders of the Company for any such amendment is not obtained, the 1996
Plan will not qualify for special tax treatment as an employee stock purchase
plan, and participating employees will realize income upon the receipt of
Common Stock after the exercise of an option granted under the 1996 Plan. The
1996 Plan has no termination date.
TAX CONSIDERATIONS
The 1996 Plan is intended to qualify as an "employee stock purchase plan"
under Section 423 of the Code, which, in part, requires approval of the 1996
Plan within 12 months immediately subsequent to the adoption of the 1996 Plan.
If the adoption of the 1996 Plan is not approved by the stockholders of the
Company, the 1996 Plan will not qualify for special tax treatment as an
employee stock purchase plan, and participating employees will realize income
upon the receipt of Common Stock after the exercise of an option granted under
the 1996 Plan.
The following discussion of certain tax considerations related to the 1996
Plan assumes that the necessary approval of the 1996 Plan by the stockholders
of the Company is obtained. Under the 1996 Plan, an employee will not recognize
any gain upon receipt of a share of stock if (a) he holds such stock for two
years after the date he was first granted the option to purchase such share and
for one year after the transfer of such share to him, and (b) the employee is
employed by the Company (or a parent or subsidiary corporation or a corporation
("successor corporation"), or a parent or subsidiary corporation of such
successor corporation issuing or assuming a stock option in a transaction to
which Section 425(a) of the Code applies (merger, consolidation, acquisition,
separation, reorganization, liquidation, etc.) at all times during the period
beginning with the date he is granted the option and ending on the day three
months before the date he exercises the option.
The employee will, however, recognize gain when he thereafter disposes of the
stock, or dies still owning the stock. If an employee (a) disposes of shares
purchased under an option more than two years after the grant of the option and
one year after the transfer of such shares to him or (b) dies while owning such
shares, he will
13
<PAGE>
recognize ordinary income (compensation income) in the year of the disposition
or death in an amount equal to the lesser of (1) the excess of the fair market
value of the shares at the time of such disposition or death over the amount
paid for the shares under the option, or (2) the excess of the fair market
value of the shares at the time the option was granted over the option exercise
price. In the event that the option exercise price is not fixed or determinable
at the time the option is granted, then for purposes of this rule, the option
exercise price shall be determined as if the option was exercised at such time.
Any remaining gain resulting from such disposition will constitute capital
gain, and any loss will constitute capital loss, if the shares are held as
capital assets. The employee's basis in the shares, for purposes of computing
capital gain or loss on the disposition of such shares, will be the exercise
price plus any amount of ordinary income recognized by him on the disposition
of the shares. In general, if the employee dies while owning such shares, his
basis in the shares, for purposes of computing capital gain or loss on the
ultimate disposition of such shares by his beneficiary, will be the fair market
value of such shares on the date of the employee's death (without regard to any
amount includible in the decedent's gross income).
If the employee disposes of the shares acquired pursuant to the option within
two years of the date of the grant of the option or within one year after the
transfer of such shares to him, he will recognize ordinary income (taxable as
compensation) in the year of disposition equal to the excess, if any, of the
fair market value of the shares on the date of exercise over the exercise
price, regardless of whether such excess is greater than the gain realized on
the disposition. In addition, if such shares are held as capital assets, the
employee will realize (a) capital gain equal to the excess of the sales price
over the fair market value of the shares on the date the option was exercised
or (b) capital loss equal to the excess of the fair market value of the shares
on the date the option was exercised over the sales price. The basis in such
shares of stock, for purposes of computing such gain, will be the exercise
price of the shares plus the amount of ordinary income recognized by the
employee on the disposition of the shares. Such capital gain will be long-term
if the shares have been held more than one year at the time of disposition.
The Company is not entitled to any deduction for federal income tax purposes
in connection with the issuance or exercise of an option under the 1996 Plan
unless the employee makes a disposition of the shares purchased pursuant to the
exercise of the option within two years after the date of the grant of the
option or within one year after the transfer of such shares to him. If the
employee disposes of the shares within such period, the Company will be
entitled to a deduction equal to the amount recognized by the employee as
ordinary income. Any disposition of the shares after the end of such period
does not entitle the Company to any deduction for federal income tax purposes.
Under the Code, an employee, upon the exercise of a right to purchase stock
under the 1996 Plan, will not be in receipt of an item of "tax preference" as
described in Section 57 of the Code.
VOTE REQUIRED AND RECOMMENDATION FOR APPROVAL OF THE PROPOSED 1996 PLAN
To be approved by the stockholders, the 1996 Plan must receive the approval
of stockholders holding at least a majority of the outstanding shares of Common
Stock. The enclosed form of proxy provides a means for stockholders to vote for
the 1996 Plan, to vote against the 1996 Plan, or to abstain from voting with
respect to the 1996 Plan. Each properly executed proxy received in time for the
meeting will be voted as specified therein. If a stockholder executes and
returns a proxy but does not specify otherwise, the shares represented by such
stockholder's proxy will be voted "FOR" the amendment.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THE APPROVAL OF THE
1996 PLAN.
14
<PAGE>
CERTAIN STOCKHOLDERS
The following table sets forth certain information as of March 15, 1996,
regarding the ownership of Common Stock of: (i) each person who is known by
the Company to be the beneficial owner of more than five percent of the
outstanding shares of Common Stock; (ii) each director of the Company; (iii)
each executive officer named in the Summary Compensation Table; and (iv) all
executive officers and directors of the Company as a group. Included in the
"Number of Shares of Common Stock" are shares attributable to options that are
exercisable as of, or will be exercisable within 60 days after, March 15,
1996.
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF
SHARES OF OUTSTANDING
NAME OF BENEFICIAL OWNER(1) COMMON STOCK COMMON STOCK
--------------------------- ------------ ------------
<S> <C> <C>
FMR Corp.(2)..................................... 2,069,698 10.2%
82 Devonshire Street
Boston, Massachusetts 02109
Oppenheimer Group, Inc.(3)....................... 1,113,052 5.5%
Oppenheimer Tower
World Financial Center
New York, New York 10281
Pioneering Management Corp.(4)................... 1,080,600 5.3%
60 State Street
Boston, Massachusetts 02109
Grahame N. Clark, Jr.(5)......................... 228,896 1.1%
Paul J. Ferri(6)................................. 124,312 *
Norton A. Stuart, Jr.(7)......................... 92,685 *
William E. Bassett(8)............................ 93,633 *
Tod V. Mongan(9)................................. 85,903 *
Michael E. Faherty(10)........................... 59,292 *
Michael A. Stone(11)............................. 54,750 *
Rawles Fulgham(12)............................... 51,750 *
Merle J. Volding(13)............................. 50,077 *
Thomas G. Kamp(14)............................... 30,000 *
John G. Guthrie(15).............................. 14,505 *
A.A. Meitz(16)................................... 11,800 *
All executive officers and directors as
a group (17 persons)(17)........................ 1,242,744 6.1%
</TABLE>
- --------
* Less than one percent.
(1) Except as otherwise indicated, each stockholder has sole investment and
sole voting power with respect to the shares of Common Stock shown.
(2) As of March 8, 1996, FMR Corp. beneficially owned 2,069,698 shares of the
Common Stock of the Company. This number includes 1,750,150 shares
beneficially owned by Fidelity Management & Research Company, as a result
of its serving as investment advisor to various investment companies
registered under Section 8 of the Investment Company Act of 1940 and
serving as investment advisor to certain other funds which are generally
offered to limited groups of investors, and 319,548 shares beneficially
owned by Fidelity Management Trust Company, as a result of its serving as
trustee or managing agent for various private investment accounts,
primarily employee benefit plans, and serving as investment advisor to
certain other funds which are generally offered to limited groups of
investors.
15
<PAGE>
(3) These shares are owned by a variety of investment advisory clients of
Oppenheimer Group, Inc., which clients receive dividends and the proceeds
from the sale of such shares. In addition, no individual client is known
to have such interest with respect to more than 5% of the shares
outstanding.
(4) Pioneering Management Corporation has sole voting power for 1,080,600
shares, sole dispositive power for 50,000 shares, and shared dispositive
power for 1,030,600 shares of Common Stock of the Company. Pioneering
Management Corporation serves as investment advisor to investment
companies that beneficially own these shares.
(5) Includes 136,250 shares that Mr. Clark may acquire pursuant to stock
options and 42,193 shares of unreleased restricted stock.
(6) Includes 36,000 shares that Mr. Ferri may acquire pursuant to stock
options.
(7) Includes 57,235 shares that Mr. Stuart may acquire pursuant to stock
options and 926 shares of unreleased restricted stock.
(8) Includes 70,000 shares that Mr. Bassett may acquire pursuant to stock
options and 8,855 shares of unreleased restricted stock.
(9) Includes 45,850 shares that Mr. Mongan may acquire pursuant to stock
options and 28,619 shares of unreleased restricted stock.
(10) Includes 36,000 shares that Mr. Faherty may acquire pursuant to stock
options.
(11) Includes 36,000 shares that Mr. Stone may acquire pursuant to stock
options.
(12) Includes 36,000 shares that Mr. Fulgham may acquire pursuant to stock
options.
(13) Includes 49,702 shares that Mr. Volding may acquire pursuant to stock
options.
(14) Includes 30,000 shares that Mr. Kamp may acquire pursuant to stock
options.
(15) Includes 12,490 shares that Mr. Guthrie may acquire pursuant to stock
options and 1,876 shares of unreleased restricted stock.
(16) Includes 8,850 shares that Mr. Meitz may acquire pursuant to stock
options.
(17) Also includes 865,212 shares subject to stock options and 114,746 shares
of unreleased restricted stock.
STOCKHOLDER PROPOSALS
Any stockholder of the Company desiring to present a proposal for action at
the Annual Meeting of Stockholders to be held in 1997 must deliver the
proposal to the executive offices of the Company by no later than January 1,
1997, unless the Company notifies the stockholders otherwise.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The Board, upon the recommendation of the Audit Committee, has selected
Arthur Andersen LLP to act as independent auditors for the fiscal year ending
in December 1996.
Arthur Andersen LLP has advised the Company that it will have a
representative in attendance at the Meeting with the opportunity to make a
statement, if such representative desires to do so, and to respond to
appropriate questions presented at the Meeting.
16
<PAGE>
OTHER MATTERS
The Board does not intend to bring any other matters before the Meeting and
does not know of any matters which will be brought before the Meeting by
others. However, if any other matters properly come before the Meeting, it is
the intention of the persons named in the accompanying proxy to vote such proxy
in accordance with their judgment on such matters.
By Order of the Board of Directors
Tod V. Mongan
Senior Vice President,
General Counsel and
Secretary
Dallas, Texas
April 22, 1996
17
<PAGE>
BANCTEC, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
(EFFECTIVE JUNE 1, 1996)
ARTICLE I
NATURE OF PLAN
This employee stock purchase plan is hereby established for the purpose of
providing all eligible employees of BancTec, Inc. and of its subsidiary
corporations (within the meaning of Sections 425(e) and (f) of the Code) with
the opportunity to acquire a proprietary interest in the Company, increasing
their interest in the Company's welfare, and encouraging them to remain in the
employ of the Company.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
Section 2.1 Definitions. For the purpose of this Plan, the following
definitions shall apply unless the context requires otherwise:
(a) "Administration Committee" shall mean the Plan Administration Committee
as from time to time constituted pursuant to Section 6.1.
(b) "Board of Directors" shall mean the Board of Directors of the Company
unless otherwise indicated or the context otherwise requires.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(d) "Company" shall mean BancTec, Inc. and of its subsidiary corporations
(within the meaning of Sections 425(e) and (f) of the Code) or any successor
thereto which shall adopt this Plan.
(e) "Compensation" shall mean the regular base salary or hourly wages paid
to a Participant during such individual's period of participation in the Plan
and which are subject to withholding for Federal income tax purposes, plus any
salary reduction contributions made by the Participant attributable to such
regular base salary or hourly wages under any Code Section 401(k) salary
deferral plan or any Code Section 125 cafeteria benefit program now or
hereafter established by the Company or any affiliate. Compensation shall not
include (i) overtime payments, bonuses, commissions based on sales, profit-
sharing distributions and other incentive-type payments and (ii) any and all
contributions made on the Participant's behalf by the Company under any
employee benefit or welfare plan now or hereafter established (other than the
Code Section 401(k) or Code Section 125 contributions described above).
(f) "Effective Date" shall mean June 1, 1996; provided, however, that if the
Plan is not approved by the stockholders of the Company within the twelve
month period immediately subsequent to the date the Plan was adopted by the
Board of Directors, the Plan shall not be qualified as an "employee stock
purchase plan" under the provisions of Section 423 of the Code.
(g) "Employee" shall mean any person who, on or after the Effective Date, is
an employee (within the meaning of Sections 423 and 3401(c) of the Code) of
the Company and, if any, its subsidiary corporations (within the meaning of
Sections 425(e) and (f) of the Code).
(h) "Employer" shall mean the Company.
(i) "Exercise Date" shall mean the last day of the Exercise Period.
(j) "Exercise Period" shall mean the month of December. The Exercise Period
shall be the period during which Participants may exercise their options, in
whole or in part.
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(k) "Offering Period" shall mean the first 15 days of the month of December
immediately preceding the Payroll Deduction Period beginning on January 1st,
except the initial Offering Period shall be the period June 1, 1996 to June
15, 1996. The Offering Period shall be the period during which each eligible
Employee shall determine whether and to what extent he desires to participate
in the Plan by electing to authorize payroll deductions to be effective during
the Payroll Deduction Period immediately subsequent to the Offering Period.
(l) "Option Price" shall mean the lesser of:
(i) Eighty-five percent (85%) of the fair market value of the stock on
the date the option was granted, the first day of the Offering Period, or
(ii) Eighty-five percent (85%) of the fair market value of the stock on
the Exercise Date.
For these purposes, the fair market value of the stock on any given date
shall be determined by taking the closing price on such date of such stock, as
reported on the New York Stock Exchange ("NYSE") (or if there shall be no
trading on such date, then on the first previous date on which there is such
trading).
(m) "Participant" shall mean an Employee or former Employee to whom an
option has been granted hereunder and who has elected to participate herein by
authorizing payroll deductions.
(n) "Payroll Deduction Account" shall mean that separate account maintained
hereunder to record the amount of a Participant's wages that have been
withheld hereunder.
(o) "Payroll Deduction Period" shall mean the period January 1st through
December 31st, except that, the initial Payroll Deduction Period shall be the
period July 1, 1996 to December 31, 1996. Notwithstanding the foregoing, the
Payroll Deduction Period with respect to a given Participant shall end on the
date that the Participant receives his last paycheck from the Employer after
his employment with the Employer terminates.
(p) "Plan" shall mean the BancTec, Inc. 1996 Employee Stock Purchase Plan,
as embodied herein and as amended from time to time.
(q) "Plan Year" shall mean each calendar year, which calendar year shall be
the Plan's fiscal year.
Section 2.2 Word Usage. Except when otherwise indicated by the context, any
masculine terminology used herein also includes the feminine and neuter, and
vice versa, and the singular shall also include the plural, and vice versa.
The words "hereof", "herein" and "hereunder", and other similar compounds of
the word "here" shall mean and refer to the entire Plan and not to any
particular provision or section. All references to Sections or Articles shall
mean and refer to Sections and Articles contained in this Plan unless
otherwise indicated.
Section 2.3 Construction. It is the intention of the Company that the Plan
be qualified as an employee stock purchase plan under the provisions of
Section 423 of the Code, and all provisions shall be construed to that result.
Moreover, the provisions of the Plan shall apply only to an Employee who is in
the employ of the Company on or after the Effective Date.
ARTICLE III
ELIGIBILITY AND PARTICIPATION
Section 3.1 Eligibility. Options may be granted under the Plan only to
eligible Employees. An eligible Employee is any Employee whose customary
employment with the Company is at least twenty (20) hours per week and more
than five (5) months in any calendar year and who has or will have completed
ninety (90) continuous days of employment with the Company by the first day of
the Payroll Deduction Period.
Section 3.2 Election to Participate. Any Employee who is eligible to
participate herein may become a Participant by filing a written election to
participate with the Administration Committee and by authorizing payroll
deductions during the Offering Period under Section 4.1. An Employee may elect
to participate for less
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than the maximum number of shares to which he is entitled by authorizing a
payroll deduction under Section 4.1 of a percentage of Compensation less than
the percentage determined by the Board of Directors under Section 5.1(b).
Section 3.3 Waiver of Participation. An Employee who is otherwise eligible
to participate herein may waive his right to participate for any Payroll
Deduction Period by declining to authorize a payroll deduction. Such
declination must be filed in writing with the Administration Committee in the
time and manner specified thereby. The filing of a written declination shall
result in the Employee's waiver of participation only for the Payroll
Deduction Period to which it relates and shall be irrevocable with respect to
such Payroll Deduction Period. An Employee's waiver of participation for a
specified Payroll Deduction Period shall not, in and of itself, adversely
impact the right of such Employee to participate in the Plan during any
subsequent Payroll Deduction Period except those with respect to which he
files additional written declinations with the Administration Committee in
accordance with the provisions of this Section 3.3.
ARTICLE IV
PAYROLL DEDUCTION AUTHORIZATION
Section 4.1 Payroll Deductions. Each Employee who is eligible and elects,
pursuant to Article III, to participate herein and who is granted options
pursuant to Section 5.1, shall authorize the making of payroll deductions to
fund the purchase of the stock he may purchase pursuant to the option granted
to him hereunder. Deductions shall be made at the regular payroll periods
applicable to the Participant and shall be credited to the Participant's
Payroll Deduction Account. A Participant may not make any additional payments
into such account. The authorized payroll deduction shall continue in effect
for the Payroll Deduction Period and for each subsequent Payroll Deduction
Period, except to the extent such rate is changed in accordance with the terms
of the Plan.
(a) Amount of Payroll Deductions. Subject to such dollar or percentage
limitations during an Offering Period as the Board of Directors shall
determine, if any, and to the restrictions of Section 5.3, a Participant may
authorize payroll deductions in an amount of not less than one percent (1%)
nor more than ten percent (10%) (in multiples of one percent (1%)) of his
Compensation for the Payroll Deduction Period.
(b) Change in Authorization. Except to the extent provided in Section
4.1(c), a Participant may not vary the amount of his payroll deduction for any
Payroll Deduction Period. He may, by notice to the Administration Committee,
elect to change his payroll deduction rate, within the limits specified in
subsection (a) of this Section 4.1, during the immediately following Offering
Period, effective for the immediately following Payroll Deduction Period.
(c) Discontinuance of Payroll Deductions. A Participant may revoke his
payroll deduction authorization effective on the first day of any pay period
by filing a notice thereof with the Administration Committee at least twenty
(20) days in advance of the effective date of such revocation. Upon
discontinuance of payroll deductions, a Participant may withdraw the total
amount credited to his Payroll Deduction Account in accordance with the
provisions of Sections 4.2 and 4.3, or he may file written notice of his
intent to allow the funds in his Payroll Deduction Account to remain in such
Account until the Exercise Period, at which time he may elect to exercise the
option in whole or in part, in accordance with Section 5.5.
(d) Automatic Change or Discontinuance of Payroll Deductions. The
Administration Committee may unilaterally change or discontinue a
Participant's payroll deduction authorization if necessary to satisfy the
restrictions of Section 5.3 or otherwise to satisfy the requirements of the
Plan or Section 423 of the Code.
Section 4.2 Withdrawal of Payroll Deduction Account.
(a) As of the effective date that a Participant discontinues his payroll
deduction he may withdraw the balance credited to his Payroll Deduction
Account by filing a written request therefor with the Administration
Committee.
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(b) Notwithstanding anything contained herein to the contrary, any amounts
remaining credited to a Participant's Payroll Deduction Account on the last
day of the Payroll Deduction Period, after taking into account the exercise of
an option, in whole or in part, if any, shall be refunded to the Participant;
except that, any payroll deductions not applied to the purchase of shares of
stock on any Exercise Date because they are not sufficient to purchase a whole
share of stock shall be held for the purchase of stock on the next Exercise
Date.
(c) Notwithstanding anything contained herein to the contrary, any amounts
remaining credited to a Participant's Payroll Deduction Account on the day a
Participant's employment with the Company terminates for any reason shall be
refunded to the Participant.
Section 4.3 Forfeiture of Right to Deduct. In the event a Participant
revokes his payroll deduction authorization and withdraws the amount credited
to his Payroll Deduction Account, he shall not be permitted to redeposit such
sum at a later date, nor shall he be permitted to resume payroll deductions
until the first day of the immediately following Payroll Deduction Period.
Section 4.4 Forfeiture of Right to Exercise Options. In the event of a
withdrawal by a Participant of the amount credited to his Payroll Deduction
Account, the Participant shall forfeit all rights to any option granted to him
with respect to the withdrawn amounts.
Section 4.5 Subsequent Participation. A Participant who revokes his payroll
deduction authorization will not participate in any subsequent offering until
he has filed a new election with regard to such offering.
ARTICLE V
OPTIONS
Section 5.1 Grant of Options. For each Plan Year, unless the Board of
Directors determines otherwise, the Administration Committee shall make an
offering under which options to purchase Company stock are granted to all
Employees eligible to participate in the Plan pursuant to Section 3.1. Except
as provided in Sections 5.1(b) and 5.3 of the Plan, all Employees granted
options under the Plan shall have the same rights and privileges.
(a) Date of Grant. All options granted hereunder shall be granted on the
same date, which date shall be the first day of the Offering Period.
(b) Amount of Grant. Subject to the restrictions of Section 5.3, each
Employee who is eligible to participate herein and to whom the offering is to
be made shall be granted an option to purchase up to that number of whole
shares of Company stock which can be purchased at the Option Price with an
amount equal to such percentage of an Employee's Compensation, as the Board of
Directors determines, for the annual offering, but not to exceed ten percent
(10%) of an Employee's Compensation for the Plan Year.
(c) Number of Shares. The number of shares of stock purchasable by a
Participant on each Exercise Date shall be the number of whole shares, subject
to Section 5.3(a), obtained by dividing the amount collected from the
Participant through payroll deduction during the Payroll Deduction Period
ending with that Exercise Date (together with any carryover deductions from
the preceding purchase period) by the Option Price in effect for that Exercise
Date.
Section 5.2 Stock Subject to Plan. The stock purchased under the Plan shall
be either authorized and unissued shares or issued shares heretofore or
hereafter reacquired by the Company. Further, if for any reason any option
granted under the Plan terminates, in whole or in part, without being
exercised in full, shares subject to such terminated option which have not
been exercised may be subjected to a new option under the Plan.
(a) Maximum Number of Shares. Options may not be granted hereunder pursuant
to which more than 500,000 shares of Company stock may be purchased.
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(b) Adjustments Upon Changes in Capitalization. Notwithstanding the
foregoing provision, in the event of any change in the number or kind of
outstanding shares of Company stock subject to options hereunder effected
without receipt of consideration therefor by the Company, by reason of a stock
dividend, stock split, combination, exchange of shares or other
recapitalization, merger, or otherwise, in which the Company is the surviving
corporation, an appropriate and proportionate adjustment shall be made in the
number or kind of shares as to which options are or may be granted hereunder.
A corresponding adjustment changing the number or kind of shares allocated to
unexercised options or portions thereof, which shall have been granted prior
to any such change, shall likewise be made. Any such adjustment, however, in
the outstanding options shall be made without change in the total price
applicable to the unexercised portion of the option but with a corresponding
adjustment, if appropriate, in the price for each share of stock covered by
the option. In the event of a dispute concerning such adjustment, the decision
of the Administration Committee shall be conclusive. The number of shares
subject to any option granted hereunder shall be automatically reduced by any
fraction included therein which results from any adjustment made pursuant to
this Section 5.2(b).
(c) Transfer of Control. Further, in the event of a sale of all or
substantially all of the assets of the Company; a merger or consolidation
(other than a merger effecting a reincorporation of the Company in another
state or any other merger or a consolidation in which the stockholders of the
surviving corporation and their proportionate interests therein immediately
after the merger or consolidation are substantially identical to the
stockholders of the Company and their proportionate interests therein
immediately prior to the merger or consolidation) in which the Company is not
the surviving corporation; or any other transaction or series of transactions
resulting in a person or entity becoming the owner of 50% or more of the total
combined voting power of all classes of stock of the Company, then the Company
shall, at its option, either (i) substitute for the shares subject to the
unexercised portions of such outstanding options an appropriate number of
shares of each class of stock or other securities of the reorganized or merged
or consolidated corporation which were distributed to the stockholders of the
Company with respect to such shares (or, as appropriate, in the case of an
acquisition of the Company by another corporation, substitute the shares of
the acquiring corporation for the shares of the Company), or (ii) cancel all
such options as of the effective date of any such transaction by giving notice
to each holder thereof or his personal representative of its intention to do
so and by permitting the exercise of all such outstanding options, without
regard to any other provisions of the Plan, during the 30-day period
immediately preceding such effective date, or (iii) allow the options granted
under the Plan to remain outstanding without any modifications or amendments.
Section 5.3 Limitations on Grant of Options. Notwithstanding any provision
contained herein to the contrary,
(a) No Employee shall be granted an option hereunder which permits him
rights to purchase stock under the Plan in excess of 500 shares for each
Offering Period in which such option is outstanding at any time;
(b) No option shall be granted to an Employee hereunder if, immediately
after such option is granted, such Employee owns stock totalling five percent
(5%) or more of the total combined voting power or value of all classes of
stock of the Company, computed in accordance with Section 423(b)(3) of the
Code; and
(c) No Employee shall be granted an option hereunder which permits his
rights to purchase stock under the Plan and under all other employee stock
purchase plans (within the meaning of Section 423 of the Code) of the Company
to accrue at a rate which exceeds $25,000 (or such other rate as may be
prescribed from time to time by the Code) of fair market value of Company
stock (determined at the time such option is granted) for each calendar year
in which such option is outstanding at any time, in accordance with the
provisions of Section 423(b)(8) of the Code.
(d) Should the total number of shares of stock which are to be purchased
pursuant to outstanding purchase rights on any particular date exceed the
number of shares then available for issuance under the Plan, the
Administration Committee shall make a pro-rata allocation of the available
shares on a uniform and nondiscriminatory basis, and the payroll deductions of
each Participant, to the extent in excess of the aggregate purchase price
payable for the stock pro-rated to such individual, shall be refunded.
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Section 5.4 Expiration of Options. The expiration date of options granted
hereunder shall be the last day of the Payroll Deduction Period with respect
to which the options are granted hereunder.
Section 5.5 Exercise of Options. The option granted to a Participant may be
exercised in accordance with the following:
(a) By Participant While Employed. At any time during the Exercise Period, a
Participant may exercise his option, in whole or in part, by delivering
written notice of exercise to the Administration Committee or its agent, in
such form and in such manner as the Administration Committee shall prescribe.
Such written election shall become irrevocable on the Exercise Date. If a
Participant exercises his option in part, his option shall thereupon terminate
and become void to the extent of the part not exercised.
If, on the last day of the Exercise Period, a Participant has not exercised
his option in whole or in part and has not filed a written notice of election
not to exercise with the Administration Committee or its agent, such
Participant shall be deemed to have exercised his option in full on the last
day of the Exercise Period.
The balance credited to a Participant's Payroll Deduction Account, after
exercising his option, or after electing not to exercise such option, shall be
paid to him in cash, except to the extent that any amount may be carried over
to the next Exercise Date as provided in Section 4.2(b).
(b) By Participant After Termination of Employment. If a Participant's
employment with the Employer terminates for any reason, his option hereunder
shall immediately terminate and become void, and the amount credited to such
Participant's Payroll Deduction Account shall be paid to him in cash.
Section 5.6 Payment for Shares. Upon the exercise of an option, the shares
of stock shall be paid for in full by the transfer of the purchase price from
the amount credited to the Participant's Payroll Deduction Account to an
account of the Employer. The Participant or his personal representative, if
applicable, may purchase all or a part of the number of full shares which the
balance credited to the Participant's Payroll Deduction Account is sufficient
to purchase. Any balance credited to the Participant's Payroll Deduction
Account shall be paid to the Participant in cash except to the extent that any
amount may be carried over to the next Exercise Date as provided in Section
4.2(b).
Section 5.7 Transfer of Shares Upon Exercise. The shares of Company stock
purchased by a Participant pursuant to the exercise of an option hereunder
shall be issued or transferred to him on the books of the Company on the
Exercise Date. Until such time, the Participant shall have none of the rights
and privileges of a stockholder in the Company with respect to shares of stock
subject to an option under the Plan. As soon as practical after the Exercise
Date, a report of Participant's account setting forth the total payroll
deductions accumulated, the number of shares purchased and the remaining cash
balance to be refunded or retained in the Participant's account, if any.
Section 5.8 Transfer of Options. No option granted under the Plan may be
transferred except by will or the laws of descent and distribution and, during
the lifetime of the Participant to whom granted, may be exercised only by such
Participant.
Section 5.9 Modification, Extension and Renewal of Options. Subject to the
terms and conditions and within the limitations of the Plan and Section 423 of
the Code, the Administration Committee may modify, extend or renew outstanding
options granted under the Plan or accept the surrender of options outstanding
hereunder (to the extent not theretofore exercised) and authorize the granting
of a new option hereunder in substitution for an old option (to the extent not
theretofore exercised). However, no modification of an option granted
hereunder shall, without the consent of the Participant, alter or impair any
rights or obligations under any option theretofore granted hereunder to such
Participant under the Plan.
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ARTICLE VI
ADMINISTRATION COMMITTEE
Section 6.1 Appointment of Committee. The Administration Committee shall be
comprised of all members of the Board of Directors who are not Employees of
the Company.
(a) Interested Member. Notwithstanding anything contained herein to the
contrary, no member of the Administration Committee shall be eligible to
participate in the Plan at any time during his term as a member of the
Administration Committee.
(b) Term. Each member of the Administration Committee shall serve until his
successor is appointed. Any member of the Administration Committee may be
removed by the Board of Directors, with or without cause, which shall have the
power to fill any vacancy which may occur.
(c) Compensation. The members of the Administration Committee shall serve
without compensation for services as such, but the Company shall pay all
expenses of the Administration Committee.
Section 6.2 Powers of Administration Committee. The Administration Committee
shall have the following powers and duties:
(a) To direct the administration of the Plan in accordance with the
provisions herein set forth;
(b) To adopt rules of procedure and regulations necessary for the
administration of the Plan, provided the rules are not inconsistent with the
terms of the Plan;
(c) To determine all questions with regard to rights of Employees and
Participants under the Plan, including, but not limited to, rights of
eligibility of an Employee to participate in the Plan and the amount of a
Participant's option;
(d) To enforce the terms of the Plan and the rules and regulations it
adopts;
(e) To direct the distribution of the shares of Company stock purchased
pursuant to the exercise of an option granted hereunder;
(f) To furnish the Employer with information which the Employer may require
for tax or other purposes;
(g) To engage the service of counsel (who may, if appropriate, be counsel
for the Company) and agents whom it may deem advisable to assist it with the
performance of its duties;
(h) To prescribe procedures to be followed by Participants in exercising
options;
(i) To receive from the Employer and from Employees such information as
shall be necessary for the proper administration of the Plan;
(j) To maintain, or cause to be maintained, separate Accounts in the name of
each Participant to reflect the Participant's Payroll Deduction Account under
the Plan;
(k) To select a secretary, who need not be a member of the Administration
Committee; and
(l) To interpret and construe the Plan.
Section 6.3 Manner of Action. The decision of a majority of the members of
the Administration Committee appointed and qualified shall control. In case of
a vacancy in the membership of the Administration Committee, the remaining
members of the Committee may exercise any and all of the powers, authorities,
duties and discretion conferred upon the Administration Committee pending the
filling of a vacancy. The Administration Committee may, but need not, call or
hold formal meetings. Any decisions made or action taken pursuant to written
approval of a majority of the then members shall be sufficient. The
Administration Committee shall maintain adequate records of its decisions.
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Section 6.4 Authorized Representative. The Administration Committee may
authorize any one of its members, or its secretary, to sign on its behalf any
notices, directions, applications, certificates, consents, approvals, waivers,
letters or other documents.
Section 6.5 Nondiscrimination. The Administration Committee shall administer
the Plan in a uniform and nondiscriminatory manner.
Section 6.6 Books and Records. The Administration Committee shall maintain,
or cause to be maintained, records which will adequately disclose at all times
the options which have been granted, to whom they have been granted, the
status of the options and the number of shares of Company stock which are
subject to options. The books, forms and methods of accounting shall be the
responsibility of the Administration Committee.
ARTICLE VII
AMENDMENT AND TERMINATION
Section 7.1 Amendment. The Company shall have the right at any time and in
any manner to amend, alter or suspend the Plan.
Section 7.2 Termination. The Company shall have the right to terminate the
Plan at any time.
Section 7.3 No Alteration of Rights. Notwithstanding the foregoing
provisions of this Article VII, the Company shall not amend, alter, suspend or
terminate the Plan in any way which would adversely affect any Participant's
rights under any option then outstanding under the Plan.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Execution of Receipts and Releases. Any payment or any issuance
or transfer of shares of Company stock to any Participant, or to his legal
representative, heirs, legatee or distributee, in accordance with the
provisions of the Plan, shall to the extent thereof be in full satisfaction of
all claims hereunder against the Plan. The Administration Committee may
require such Participant, legal representative, heir, legatee or distributee,
as a condition precedent to such payment, to execute a receipt and release
therefor in such form as it shall determine.
Section 8.2 Plan Funds. To the extent permitted by law, all amounts held by
the Company for an Employee in Payroll Deduction Accounts under the Plan may
be used for any corporate purpose of the Company.
Section 8.3 No Guarantee of Interests. Neither the Administration Committee
nor the Employer guarantees the Company stock from loss or depreciation.
Section 8.4 Payment of Expenses. All expenses incident to the design,
establishment, administration, termination or protection of the Plan,
including, but not limited to, legal and accounting fees, shall be paid by the
Company or appropriate Employer.
Section 8.5 Employer Records. Records of the Employer as to an Employee's or
Participant's period of employment, termination of employment and the reason
therefor, leaves of absence, re-employment and Compensation will be conclusive
on all persons, unless determined to be incorrect.
Section 8.6 Interpretations and Adjustments. To the extent permitted by law,
an interpretation of the Plan and a decision on any matter within the
Administration Committee's discretion made in good faith is binding on all
persons. A misstatement or other mistake of fact shall be corrected when it
becomes known and the person responsible shall make such adjustment on account
thereof as he considers equitable and practicable.
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Section 8.7 Uniform Rules. In the administration of the Plan, uniform rules
will be applied to all Participants similarly situated.
Section 8.8 No Rights Implied. Nothing contained in the Plan or any
modification or amendment to the Plan or in the creation of any Payroll
Deduction Account, or the issuance of any option or shares of Company stock
pursuant to such option, shall give any Employee or Participant any right to
continue employment, any legal or equitable right against the Company, any
other Employer, or any officer, director or Employee of the Company or any
Employer, except as expressly provided by the Plan.
Section 8.9 Information. The Employer shall, upon request or as may be
specifically required hereunder, furnish or cause to be furnished, all of the
information or documentation which is necessary or required by the
Administration Committee to perform its duties and functions under the Plan.
The Employer's records as to the current information the Employer furnishes to
the Administration Committee shall be conclusive as to all persons, unless
determined to be incorrect.
Section 8.10 No Liability. The Employer assumes no obligation or
responsibility to any of the Employees, Participants, or personal
representatives, heirs, legatees or distributees for any act of, or failure to
act, on the part of the Administration Committee.
Section 8. 11 No Liability for Good Faith Determinations. Neither the
members of the Board of Directors nor any member of the Administration
Committee shall be liable for any act, omission or determination taken or made
in good faith with respect to the Plan or any option granted under it, and
members of the Board of Directors and the Administrative Committee shall be
entitled to indemnification and reimbursement by the Company in respect of any
claim, loss, damage or expense (including attorneys' fees, the costs of
settling any suit, provided such settlement is approved by legal counsel
selected by the Company, and amounts paid in satisfaction of a judgment,
except a judgment based on a finding of bad faith) arising therefrom to the
full extent permitted by law and under any directors and officers liability or
similar insurance coverage that may from time to time be in effect.
Section 8.12 Company Action. Any action required of the Company or any
Employer shall be by resolution of its Board of Directors or by a person
authorized to act by board resolution.
Section 8. 13 Severability. In the event any provision of the Plan shall be
held to be illegal or invalid for any reason, the illegality or invalidity
shall not affect the remaining provisions of the Plan, but shall be fully
severable and the Plan shall be construed and enforced as if the illegal or
invalid provision had never been included herein.
Section 8.14 Notice. Any notice required to be given herein by the Employer
or the Administration Committee shall be deemed delivered, when (a) personally
delivered or (b) placed in the United States mails, in an envelope addressed
to the last known address of the person to whom the notice is given.
Section 8.15 Waiver of Notice. Any person entitled to notice under the Plan
may waive the notice.
Section 8.16 Successors. The Plan shall be binding upon all persons entitled
to options under the Plan, their respective heirs, legatees and legal
representatives, upon the Employer, its successors and assigns, and upon the
Administration Committee and their successors.
Section 8.17 Headings. The titles and headings of Articles and Sections are
included for convenience of reference only and are not to be considered in
construction of the provisions hereof.
Section 8.18 Governing Law. All questions arising with respect to the
provisions of this Plan shall be determined by application of the laws of the
State of Texas except to the extent Texas law is preempted by Federal statute.
The obligation of the Company to sell and deliver stock under the Plan is
subject to applicable laws and to the approval of any governmental authority
required in connection with the authorization, issuance, sale or delivery of
such stock.
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BANCTEC, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR
THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 22, 1996
The undersigned hereby appoints Grahame N. Clark, Jr. and Raghavan Rajaji
as proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote as designated below, all the shares of common
stock of BancTec, Inc. held of record by the undersigned on April 12, 1996, at
the Annual Meeting of Stockholders to be held on May 22, 1996 at 10:00 a.m.,
Dallas, Texas time, at the Texas Commerce Bank Tower, Fourth Floor Boardroom,
2200 Ross Avenue, Dallas, Texas, and at any adjournment(s) thereof. Receipt of
the Notice of Annual Meeting of Stockholders and the Proxy Statement in
connection therewith, each dated April ___, 1996, is hereby acknowledged. The
undersigned hereby revokes any proxies heretofore given.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS HEREON. IN
THE ABSENCE OF SUCH SPECIFICATIONS, THE PROXY WILL BE VOTED FOR THE ELECTION TO
THE BOARD OF DIRECTORS OF THE NOMINEES LISTED ON THIS PROXY, FOR APPROVAL OF THE
BANCTEC, INC. 1996 EMPLOYEE STOCK PURCHASE PLAN AND IN THE DISCRETION OF THE
PROXIES ON ANY OTHER BUSINESS.
(REVERSE SIDE)
_____________________________________________________________
__________
COMMON
1. ELECTION OF DIRECTORS: Grahame N. Clark, Jr., A.A. Meitz, and Michael A.
Stone (INSTRUCTION: To withhold authority for any individual nominee, write
that nominee's name on the space provided below.)
FOR all nominees WITHHOLD AUTHORITY
listed above (except to vote FOR all ______________________________
as marked to the nominees listed above.
contrary).
_____ _____
2. APPROVAL OF THE ADOPTION OF THE BANCTEC, INC. 1996 EMPLOYEE STOCK PURCHASE
PLAN:
FOR AGAINST ABSTAIN
____ ____ ____
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE WITH RESPECT TO ANY
OTHER MATTER WHICH MAY PROPERLY COME BEFORE THE MEETING OR ANY
ADJOURNMENT(S) THEREOF.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE ANNUAL
MEETING OF STOCKHOLDERS TO BE HELD ON MAY 22, 1996.
Dated: _____________, 1995
__________________________
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Signature(s)
When signing on behalf of a
corporation, partnership, estate,
trust, or in any other
representative capacity, please
sign name and title. For joint
accounts each joint owner must sign.
