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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a Party other than the Registrant /X/
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
MYLEX CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
MERRILL CORPORATION
- --------------------------------------------------------------------------------
(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.:
------------------------------------------------------------------------
3) Filing Party:
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4) Date Filed:
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<PAGE>
MYLEX LOGO
MYLEX CORPORATION
------------------
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
------------------------
APRIL 24, 1995
TO THE SHAREHOLDER:
NOTICE IS HEREBY GIVEN that the 1995 Annual Meeting of Shareholders of Mylex
Corporation, a Florida corporation (the "Company"), will be held on Monday,
April 24, 1995, at 2:00 p.m. at the principal executive offices of the Company
located at 34551 Ardenwood Blvd., Fremont, California 94555, for the following
purposes.
1. To elect directors to serve for the following year and until their
successors are duly elected.
2. To approve an amendment to the Company's 1993 Stock Option Plan to
increase the number of shares of Common Stock authorized for issuance
thereunder by 700,000 shares.
3. To ratify the appointment of KPMG Peat Markwick LLP as independent
public accountants of the Company for the fiscal year ending December 31,
1995.
4. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The following items of business are more fully described in the Proxy
Statement accompanying this notice.
Only shareholders of record at the close of business on March 23, 1995, are
entitled to notice of and to vote at the meeting.
All shareholders are cordially invited to attend the meeting in person.
However, to assure your representation at the meeting, you are urged to mark,
sign, date and return the enclosed Proxy as promptly as possible in the envelope
enclosed for that purpose. Any shareholder attending the meeting may vote in
person even if he or she previously returned a Proxy.
Sincerely,
[SIG]
Al Montross
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Fremont, California
March 23, 1995
YOUR VOTE IS IMPORTANT.
IN ORDER TO ASSURE YOUR REPRESENTATION AT THE MEETING, YOU ARE REQUESTED TO
COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE AND RETURN
IT IN THE ENCLOSED ENVELOPE.
<PAGE>
MYLEX LOGO
MYLEX CORPORATION
------------------
PROXY STATEMENT
1995 ANNUAL MEETING OF SHAREHOLDERS
------------------------
APRIL 24, 1995
GENERAL
The enclosed Proxy is solicited on behalf of Mylex Corporation (the
"Company") for the Annual Meeting of Shareholders to be held on April 24, 1995,
at 2:00 p.m. at the principal executive offices of the Company located at 34551
Ardenwood Blvd., Fremont, California 94555, or any adjournment or adjournments
thereof, for the purposes set forth herein and in the accompanying Notice of
Annual Meeting of Shareholders. The Company's telephone number is (510)
796-6100.
These proxy solicitation materials were mailed on or about March 23, 1995,
to all shareholders entitled to vote at the meeting.
RECORD DATE AND SHARES OUTSTANDING
Only shareholders of record at the close of business on March 23, 1995 (the
"Record Date") are entitled to receive notice of and to vote at the meeting. The
issued and outstanding voting securities of the Company at the Record Date
consisted of 14,390,111 shares of Common Stock, par value $0.01.
REVOCABILITY OF PROXIES
The enclosed Proxy is revocable at any time before its use by delivering to
the Secretary of the Company a written notice of revocation or a duly executed
proxy bearing a later date. If a person who has executed and returned a proxy is
present at the meeting and wishes to vote in person, he or she may elect to do
so and thereby suspend the power of the proxy holders to his or her proxy.
VOTING AND SOLICITATION
Each outstanding share of the Company's Common Stock is entitled to one vote
on all matters submitted to a vote at a meeting of shareholders.
The cost of soliciting proxies will be borne by the Company. In addition,
the Company may reimburse brokerage firms and other persons representing
beneficial owners of shares for their expenses in forwarding solicitation
material to such beneficial owners. Proxies may also be solicited by certain of
the Company's directors, officers and regular employees, without additional
compensation, personally or by telephone, telegraph, telefax, or otherwise.
QUORUM; ABSTENTIONS; BROKER NON-VOTES
The Company Bylaws provide that the presence in person or by proxy of
shareholders holding a majority of the shares of stock issued and outstanding
and entitled to vote thereon shall constitute a quorum at an annual meeting of
shareholders.
For determining whether a proposal has received a majority vote, abstentions
will be included in the vote totals, with the result that an abstention will
have the same effect as a negative vote. In instances where brokers are
prohibited from exercising discretionary authority for beneficial holders who
have not returned a proxy (so called "broker non-votes"), those shares will not
be included in the vote totals and, therefore, will have no effect on the
outcome of the vote. However, broker non-votes, shares that abstain and shares
for which the authority to vote is withheld on certain matters will be treated
as present for quorum purposes on all matters.
<PAGE>
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
Proposals of shareholders of the Company that are intended to be presented
by such shareholders at the Company's 1996 Annual Meeting must be received by
the Company no later that November 24, 1995, in order that they may be
considered for inclusion in the proxy statement and form of proxy relating to
that meeting.
PROPOSAL ONE
ELECTION OF DIRECTORS
NOMINEES
A board of six directors is to be elected at the meeting. Until otherwise
instructed, the proxy holders will vote all of the proxies received by them for
each of the Company's six nominees named below. Each of the nominees is
currently a director of the Company. In the event that any such nominee is
unable or declines to serve as a director at the time of the Annual Meeting, the
proxies will be voted for any nominee who shall be designated by the current
Board of Directors to fill the vacancy. In the event that additional persons are
nominated for election as directors, the proxy holders intend to vote all
proxies received by them in such a manner as will ensure the election of as many
of the nominees listed below as possible. In such event, the specific nominees
to be voted for will be determined by the proxy holders. It is not expected that
any nominee will be unavailable. The term of office of each person elected as a
director will continue until the next Annual Meeting of Shareholders and until
his successor has been elected and qualified.
The names of the nominees of management and certain information about them
are set forth below.
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE PRINCIPAL OCCUPATION SINCE
- -------------------- --- ------------------------------------------------------------------- --------
<S> <C> <C> <C>
Mr. Ismael Dudhia 60 Independent Consultant 1991
Dr. M. Yaqub Mirza 48 President and Chief Executive Officer of Mar-Jac Investments, Inc. 1988
Dr. Inder M. Singh 48 President of Lynx Real-Time System, Inc. 1986
Mr. Richard Love 61 Principal, RJL Capital management 1993
Mr. Al Montross 58 President and Chief Executive Officer of the Company 1994
Mr. Stephen McKenzie 65 Chief Executive Officer, Resource Management 1995
</TABLE>
Except as set forth below, each of the nominees has been engaged in the
principal occupation described above during the past five years.
ISMAEL DUDHIA
Mr. Ismael Dudhia was elected Director of the Company in July 1991 and
became Chairman in December 1993. From 1983 until October 1991, Mr. Dudhia was
Chairman of the Board and active in the management of Coolidge Bank and Trust
Company of Boston, Massachusetts, which was wholly owned by Mr. Dudhia from 1986
until 1991. In 1991, principally as a result of the local and national recession
and significant declines in the real estate market in the Boston, Massachusetts
area, Coolidge was declared insolvent and its assets were sold by the Federal
Deposit Insurance Corporation to another bank. In 1961, Mr. Dudhia obtained a
degree of Barrister-at-Law from Lincolns Inn, an education institution in
England. From November 1993 until April 1994, Mr. Dudhia served as a director
and Chairman of Northgate Computer Systems, Inc. a Minnesota based computer
company ("Northgate"). See "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."
M. YAQUB MIRZA
Dr. M. Yaqub Mirza has served as a Director of the Company since December
1988 and served as Secretary since February 1989. He is currently President and
Chief Executive Officer of Mar-Jac Investments, Inc. an investment and
management consulting firm in Herndon, Virginia. He currently serves as a
Trustee and treasurer on the Board of Trustees of Amana Mutual Funds Trust, a
mutual
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fund registered pursuant to the Investment Company Act of 1940. He is also
Chairman of the Board of Jugos Concetrados, S.A., which is traded on the
Santiago, Chile, Stock Exchange. Dr. Mirza also serves as an officer of Safa
Trust, Inc. Dr. Mirza holds a doctorate in physics from the University of Texas.
From July 1992 until April 1994, Dr. Mirza served as a member of the Board of
Directors of Northgate. See "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."
INDER M. SINGH
Dr. Inder M. Singh has served as a Director of the Company since December
1986 and as the Company's Treasurer from February 1989 to November 1989. Since
March 1988, Dr. Singh has been the President of Lynx Real-Time System, Inc., a
software company. From April 1985 to March 1988, he was the owner and operator
of Simran Associates, a California Computer consulting firm. From March 1982 to
March 1985, he served as President of Excelan, Inc., a California computer
networking company. Before forming Excelan, Inc., Dr. Singh held executive level
positions with Zilog Incorporated and Amdahl Corporation, both of which are
California electronic manufacturing companies. Dr. Singh holds a doctorate in
Electrical Engineering from Yale University.
RICHARD LOVE
Mr. Richard Love has served as a Director of the Company since July 1993 and
was appointed Treasurer in January 1995. Mr. Love is currently a principal of
RJL Capital Management of Santa Barbara, an investment management firm. From
1973 to 1988, Mr. Love served as an investment counselor, then senior partner,
with Loomis, Sayles & Co. Before joining Loomis, Sayles & Co., Mr. Love held
positions with James Capel Investment Banking of San Francisco from 1969-1973
and with Stein, Roe & Farnham of Chicago as investment counsel and partner from
1959 to 1969. Mr. Love attended the Lawrenceville School and received a
Bachelor's degree in Metallurgical Engineering from Cornell University in 1956.
He is an ICAA Chartered Investment Counselor. From July 1992 to September 1993,
Mr. Love served as a member of the Board of Directors of Northgate. See "CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS."
AL MONTROSS
Mr. Montross was appointed President and Chief Executive Officer of the
Company on April 1, 1994. Mr. Montross became a Director in May 1994. In
September 1993, Mr. Montross joined the Company as Executive Vice President and
in December 1993 was appointed Acting President and Chief Operating Officer.
From August 1992 to September 1993 he held the position of Senior Vice President
at Distributed Processing Technology of Maitland, Florida, a computer
peripherals manufacturer. From 1989 to 1992, Mr. Montross held the position of
President and Chief Operating officer at Inacomp Computer Centers, Inc., of Troy
Michigan, a major national computer equipment retailer. He currently serves as a
director of American Speedy Printing Centers, Inc. of Bloomfield Hills,
Michigan. Mr. Montross holds a Bachelor's degree in Economics from Siena College
in New York.
STEPHEN MCKENZIE
Mr. Mckenzie was appointed Director in January 1995. Mr. McKenzie is
currently Chief Executive Officer, Resource Management of San Jose, California,
a receivable financing company. From December 1989 to January 1991 he was Senior
Vice President of Sales and Marketing and Cofounder of Reply Corporation, a
California manufacturer of microchannel personal computers. Prior to Reply, from
February 1987 to September 1989, Mr. McKenzie was President of Acer America,
Inc., a computer clone manufacturer. He currently serves as the Chairman of the
Board of Microspeed Corporation, of Fremont California, a manufacturer of
personal computer input devices. Mr. McKenzie holds a Bachelor's degree in
Political Science from the University of Nebraska.
VOTE REQUIRED
The six nominees for director receiving the highest number of affirmative
votes of the shares entitled to be voted for them shall be elected as directors.
THE COMPANY'S MANAGEMENT RECOMMENDS A VOTE "FOR" ALL NOMINEES LISTED ABOVE.
3
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PROPOSAL TWO
AMENDMENTS TO THE 1993 STOCK OPTION PLAN
The Company's 1993 Employee Stock Option Plan (the "Option Plan"), was
approved by the Board of Directors on May 9, 1993 and by the shareholders on
July 26, 1993. As of December 31, 1994, options to purchase 1,297,250 shares
have been granted and were outstanding and 128,750 shares remained available for
future grants.
PROPOSED AMENDMENTS
On January 23, 1995, the Board, subject to shareholder approval, approved an
amendment increasing the number of shares reserved for issuance by an additional
700,000, for an aggregate of 2,075,000 shares reserved for issuance under the
Option Plan.
VOTE REQUIRED
The affirmative vote of the holder of a majority of the shares represented,
in person or by proxy, and voting at the Annual Meeting (which shares voting
affirmatively also constitute at least a majority of the required quorum) will
be required to approve the amendments to the Option Plan.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE
AMENDMENTS TO THE OPTION PLAN.
SUMMARY OF THE OPTION PLAN
PURPOSE. The principal purpose of the Option Plan is to provide equity
incentives to the Company's employees, consultants, and outside directors by
enabling them to participate in the Company's success and to encourage the
participants' continued service to the Company.
ADMINISTRATION. The Option Plan is administered by the Board of Directors
of the Company or a committee that is intended to comply with Rule 16b-3 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and other
applicable laws (the "Administrator"). The Administrator has the power to
determine eligibility to receive an option, the terms of options granted,
including the exercise or purchase price, number of shares subject to the
option, the vesting schedule and the term of the option.
ELIGIBILITY. The Option Plan provides that options may be granted to
employees (including officers and directors who are also employees), of the
company or any parent or majority-owned subsidiary, and members of the Board of
Directors of the Company who are Outside Directors. As of the Record Date, there
were 143 employees, 2 consultants and 5 Outside Directors eligible to be granted
Options under the Option Plan. Incentive stock options may be granted only to
employees. Except with respect to Outside Directors, the Administrator selects
the optionees and determines the number of shares to be subject to each option
and the time or times at which shares become exercisable under the option. In
making such determination, the duties and responsibilities of the employee or
consultant, the value of his or her services, his or her present and potential
contribution to the success of the Company, the anticipated number of years of
future service, and other relevant factors are taken into account. Generally,
such options become exercisable or "vest" over a three to four year period. Each
option may be exercised only to the extent it is vested.
OUTSIDE DIRECTORS' OPTIONS. The Option Plan provides that a nonstatutory
option to purchase 50,000 shares of the Company's Common Stock (the "First
Option") shall be automatically granted (the "Automatic Grant Program") to
Outside Directors who are elected or appointed to the Board subsequent to May 9,
1993. An additional option to purchase 50,000 shares of the Company's Common
Stock shall be automatically grated to Outside Directors who receive the First
Option, and who remain on the Board of Directors of the Company three years
following the grant of the First Option. This additional Option shall be the
"Second Option." The exercise price of options granted under the Automatic Grant
Program is the fair market value of the Company's Common Stock on the date of
the automatic grant. Outside Directors may not be granted options under the
Option Plan except under the Automatic Grant Program. The First Option becomes
exercisable cumulatively with respect to
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1/36 of the underlying shares on the first day of each month following the date
of grant of such option. The Second Option becomes exercisable cumulatively with
respect to 1/60 of the underlying shares on the first day of each month
following the date of grant of such option.
TERMS OF OPTIONS. The terms of options granted under the Option Plan,
(other than options granted to Outside Directors pursuant to the Automatic Grant
Program, (the "Outside Director Options"), are determined by the Administrator.
Each option granted under the Option Plan is evidenced by a written stock option
agreement between the Company and the optionee and is subject to the following
additional terms and conditions:
(a) EXERCISE OF OPTION. An option granted under the Option Plan is
exercised by giving written notice of exercise to the Company, specifying
the number of full shares of Common Stock to be purchased and tendering
payment of the purchase price to the Company. Payment for shares issued upon
exercise of an option may consist of cash, check, promissory note, other
shares of the Company's Common Stock or any combination of such methods of
payment, or such other consideration and method of payment as is permitted
under the law.
(b) EXERCISE PRICE. The per share exercise price of options under the
Option Plan (other than Outside Director Options) is determined by the
Administrator and, in the case of incentive stock options, may not be less
than 100% of the fair market value on the date of grant. The Administrator
may grant non-statutory stock options at less than fair market value. For so
long as the Company's Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
National Association of Securities Dealers, Inc. Automated Quotation
("NASDAQ") National Market System, the fair market value of a share of
Common Stock shall be the closing sale price for such stock (or the closing
bid, if no sales were reported) as quoted on such system or exchange (or the
exchange with the greatest volume of trading in Common Stock) on the date of
grant of the Option, as reported in The Wall Street Journal or such other
source as the Administrator deems reliable.
(c) TERMINATION OF STATUS AS AN EMPLOYEE, CONSULTANT, OR OUTSIDE
DIRECTOR. If the optionee's employment or consulting relationship with the
Company or status as an Outside Director is terminated for any reason (other
than death or disability), options may be exercised within six (6) months
(or such other period of time not exceeding six (6) months as is determined
by the Administrator) after such termination as to all or part of the shares
as to which the optionee was entitled to exercise at the date of such
termination.
(d) DEATH OR DISABILITY OF OPTIONEE. Options may be exercised within
no more than twelve (12) months following termination because of a permanent
and total disability or by the employee's estate after his or her death.
(e) TERMS AND TERMINATION OF OPTIONS. Options granted under the Option
Plan may have a term of up to ten (10) years. No option may be exercised by
any person after the expiration of its term. In the case of an incentive
stock option granted to an optionee who, immediately before the grant of
such option, owns more than 10% of the voting power or value of all classes
of stock of the Company, the term of such incentive stock option may not
exceed five (5) years.
(f) TRANSFERABILITY OF OPTIONS. An option is not transferable by the
optionee, other than by will or the laws of descent or distribution, and is
exercisable during the optionee's life time only by the optionee. In the
event of the optionee's death, options may be exercised by a person who
acquires the right to exercise the option by bequest or inheritance.
(g) OTHER PROVISIONS. The option agreement may contain such other
terms, provisions, and conditions not inconsistent with the Option Plan as
may be determined by the Administrator.
CHANGES IN CAPITALIZATION. In the event a change, such as a stock split or
stock dividend payable in Common Stock, is made in the Company's capitalization
that results in an exchange of Common Stock for a greater or lesser number of
shares without receipt of consideration by the Company,
5
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appropriate adjustment shall be made in the option price and number of shares
subject to outstanding options. Appropriate adjustment will also be made in the
number of shares of Common Stock that have been authorized for issuance under
the Option Plan but as to which no options have yet been granted or which have
been returned to the Option Plan upon cancellation of an option. Such
adjustments shall be made by the Board of Directors, whose determination shall
be final and conclusive, subject to any required action by the shareholders of
the Company.
In the event of the proposed dissolution or liquidation of the Company,
options outstanding under the Option Plan will terminate immediately prior to
the consummation of such proposed action, unless otherwise provided by the
Board. The Board may, in the exercise of its discretion, declare that any
outstanding option (except an Outside Director Option) shall terminate as of a
date fixed by the Board and give each optionee the right to exercise his or her
option as to all or any part of the optioned stock, including shares as to which
the option would not otherwise be exercisable. In the event of a proposed sale
of all or substantially all of the assets of the Company, or the merger of the
Company with or into another corporation, outstanding options shall be assumed
or an equivalent option shall be substituted by such successor corporation (or a
parent or subsidiary of such successor corporation), unless such successor
corporation does not agree to assume the options or to substitute an equivalent
option, in which case the optionee shall have the right to exercise all
outstanding options as to all of the optioned stock, including shares as to
which the option would not otherwise be exercisable. If the Board makes an
outstanding option fully exercisable in lieu of assumption or substitution in
the event of a merger or sale of assets, the Board shall notify the optionee
that his or her outstanding options shall be fully exercisable for a period of
fifteen (15) days from the date of such notice, and the option will terminate
upon the expiration of such period.
AMENDMENT AND TERMINATION OF THE OPTION PLAN. Except with respect to the
Automatic Grant Program, the Board may amend or terminate the Option Plan from
time to time in such respects as the Board may deem advisable; provided that, to
the extent necessary and desirable to comply with Rule 16b-3 promulgated under
the Exchange Act, or with Section 422 of the Code or any other successor or
applicable law or regulation, the Company shall obtain shareholder approval of
any Option Plan amendment in such a manner and to such a degree as is required
by the applicable law, rule, or regulation. The automatic Grant Program may not
be amended more than once every six months. Any amendment or termination of the
Option Plan shall not affect options already granted and such options shall
remain in full force and effect as if the Option Plan had not been amended or
terminated, unless mutually agreed otherwise between the optionee and the Board,
which agreement must be in writing and signed by the optionee and the Company.
In any event, the Option Plan shall terminate in 2003. Any options
outstanding under the Option Plan at the time of its termination shall remain
outstanding until they expire by their terms.
TAX INFORMATION. Options granted under the Option Plan may be either
"Incentive stock options," as defined in Section 422 of the Code, or
nonstatutory options.
INCENTIVE STOCK OPTIONS. If an option granted under the Option Plan is an
incentive stock option, the optionee will recognize no income upon grant of the
incentive stock option and incur no tax liability due to the exercise unless the
option is subject to the alternative minimum tax. The Company will not be
allowed a deduction for federal income tax purposes as a result of the exercise
of an incentive stock option, regardless of the applicability of the alternative
minimum tax. Upon the sale or exchange of the shares at least two (2) years
after grant of the option and one (1) year after receipt of the shares by the
optionee, any gain will be treated as a long-term capital gain. If these holding
periods are not satisfied, the optionee will recognize ordinary income equal to
the difference between the exercise price and the lower of the fair market value
of the stock at the date of the option exercise or the price of the stock. A
different rule for measuring ordinary income upon such a premature disposition
may apply if the optionee is also an officer; director; or 10% shareholder of
the Company. The Company will be entitled to a deduction in the same amount as
the ordinary income recognized by the optionee. Any gain recognized on such a
premature disposition of the shares in excess of the
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amount treated as ordinary income, will be characterized as long-term capital
gain. Currently, tax on net capital gain (net long-term capital gain minus net
short-term capital loss) is capped at 28%. Capital losses are allowed in full
against capital gains plus $3,000 of other income.
NONSTATUTORY OPTIONS. All other options which do not qualify as incentive
stock options are referred to as nonstatutory options. An optionee will not
recognize any taxable income at the time he is granted a nonstatutory option.
However, upon its exercise, the optionee will recognize ordinary income for tax
purposes measured by the excess of the then fair market value of the shares over
the option price. In certain circumstances, where the shares are subject to a
substantial risk or forfeiture when acquired or where the optionee is an
officer, director, or 10% shareholder of the Company, the date of taxation may
be deferred unless the optionee files an election with the Internal Revenue
Service under Section 83(b) of the Code. The income recognized by an optionee
who is also an employee of the Company will be subject to tax withholding by the
Company by payment in cash or out of the current earnings paid to the optionee.
Upon resale of such shares by the optionee, any difference between the sales
price and the exercise price, to the extent not recognized as ordinary income as
provided above, will be treated as capital gain or loss.
The Company will be entitled to a tax deduction in the amount and at the
time that the Optionee recognizes ordinary income with respect to shares
acquired upon exercise of a nonstatutory option.
The foregoing is only a summary of the effect of federal income taxation
upon the optionee and the Company with respect to the grant and exercise of
options under the Option Plan, does not purport to be complete and does not
discuss the income tax laws of any municipality, state, or foreign country in
which an optionee may reside.
STOCK PRICE. The closing price of a share of Common Stock on the NASDAQ
National Market System on March 23, 1995, was $8.875.
PLAN BENEFITS. The Company cannot now determine the number of options to be
received in the future by the executive officers named under "EXECUTIVE OFFICER
COMPENSATION -- Summary Compensation Table," all current executive officers as a
group or all employees (including current officers who are not executive
officers) as a group. See "EXECUTIVE COMPENSATION -- Option Grants in the Last
Fiscal Year" for the number of stock options granted to the executive officers
named in the Summary Compensation Table in the fiscal year ended December 31,
1994. In the fiscal year ended December 31, 1994, options to purchase 285,000
shares of the Common Stock of the Company were granted to all current executive
officers as a group and options to purchase 361,250 shares of Common Stock of
the Company were granted to all employees (including current officers who are
not executive officers).
PROPOSAL THREE
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Management has selected KPMG Peat Marwick LLP, independent public
accountants, to audit the books, records and accounts of the Company for the
current fiscal year ending December 31, 1995. KPMG Peat Marwick LLP has audited
the Company's financial statements since the fiscal year ended December 31,
1987.
The affirmative vote of the holders of a majority of the Company's Common
Stock represented and voting at the Annual Meeting will be required to approve
and ratify the Board's selection of KPMG Peat Marwick LLP. In the event of a
negative vote on such ratification, the Board of Directors will reconsider its
selection.
A representative of KPMG Peat Marwick LLP is expected to be available at the
Annual meeting to make a statement if such representative desires to do so and
to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE
APPOINTMENT OF KPMG PEAT MARWICK LLP AS THE INDEPENDENT AUDITORS FOR THE 1995
FISCAL YEAR.
7
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MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors of the Company held a total of eight meetings during
fiscal 1994. During fiscal 1994, no director attended fewer than seventy-five
percent (75%) of the meetings of the Board of Directors and committees thereof,
if any, upon which such director served. The board of Directors in 1994 had an
Audit Committee and a Compensation and Stock Option Plan Committee. For the
fiscal year 1995, the Compensation and Stock Option Plan Committee has been
split into separate committees; Compensation Committee and Stock Option Plan
Committee.
During fiscal 1994, the Audit Committee consisted of Messrs., Dudhia, Mirza
and Singh which met once. The Audit Committee approves the engagement of and the
services to be performed by the Company's independent auditors and review the
Company's accounting principles and its system of internal accounting controls.
For 1995, the Audit Committee shall consist of Messrs., Love, McKenzie, Mirza
and Singh.
The Compensation and Stock Option Plan Committee met two times in fiscal
1994 and consisted of Messrs. Dudhia, Singh and Love. The charter of the
combined Compensation and Stock Option Plan committee were (i) to review and
approve the Company's executive compensation policy and distributions to
officers under the Executive Incentive Plan and (ii) to review and approve
grants of stock options to employees, including officers, of the Company. For
1995 the combined committee shall be separated into two committees; Compensation
Committee and Stock Option Plan Committee. The Compensation Committee shall
consist of Messrs., Dudhia, Love and Singh. The Stock Option Plan Committee
shall consist of Messrs., Dudhia, Mirza and Montross.
The Board of Directors does not have a Nominating Committee or any committee
performing similar functions.
COMPENSATION OF DIRECTORS
The Company's outside directors are remunerated for each Board of Directors
meeting attended by the respective director. Since June 25, 1990, the outside
directors of the Board have been paid a fee of $1,000 per meeting and since
October 1994, each outside director is paid a $500 fee for each telephonic
meeting. In addition, outside directors are entitled to participate in the
Company's Option Plan. See "PROPOSAL TWO -- AMENDMENTS TO THE 1993 STOCK OPTION
PLAN -- Summary of the Option Plan."
SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
The following table set forth the beneficial ownership of Common Stock as of
the Record Date, (i) by each director, (ii) by each executive officer named in
the Summary Compensation Table, (iii) by all directors and executive officers as
a group and (iv) by all persons known to the Company to be the beneficial owners
of more than five percent of the Company's Common Stock:
<TABLE>
<CAPTION>
APPROXIMATE PERCENT
NAME SHARES OF CLASS
- ------------------------------------------------------------------- ---------------- -----------
<S> <C> <C>
Mr. Al Montross ................................................... 35,000(1) 0.23%
34551 Ardenwood Blvd.
Fremont, CA 94555
Ms. Colleen Meyers ................................................ 15,834(2) 0.10%
34551 Ardenwood Blvd.
Fremont, CA 94555
Dr. Parveen Gupta ................................................. 160,000(3) 1.05%
34551 Ardenwood Blvd.
Fremont, CA 94555
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
APPROXIMATE PERCENT
NAME SHARES OF CLASS
- ------------------------------------------------------------------- ---------------- -----------
<S> <C> <C>
Mr. Peter Shambora ................................................ 9,500(4) 0.06%
34551 Ardenwood Blvd.
Fremont, CA 94555
Mr. Sherman Tom ................................................... 17,250(5) 0.11%
34551 Ardenwood Blvd.
Fremont, CA 94555
Mr. Ismael Dudhia ................................................. 78,326(6) 0.51%
34551 Ardenwood Blvd.
Fremont, CA 94555
Dr. Inder M. Singh ................................................ 200,826(7) 1.31%
34551 Ardenwood Blvd.
Fremont, CA 94555
Dr. M. Yaqub Mirza ................................................ 863,418(8) 5.65%
34551 Ardenwood Blvd.
Fremont, CA 94555
Mr. Richard Love .................................................. 461,036(9) 3.01%
34551 Ardenwood Blvd.
Fremont, CA 94555
Mr. Stephen McKenzie .............................................. 1,389(10) 0.01%
34551 Ardenwood Blvd.
Fremont, CA 94555
All current directors and executive officers as a group
(11 persons) ..................................................... 1,905,079(11) 12.46%
34551 Ardenwood Blvd.
Fremont, CA 94555
George Valente and group .......................................... 1,140,636(12) 7.46%
1200 Oliver Road
Fairfield, CA 94533
<FN>
- ------------------------
(1) Includes options of 25,000 shares exercisable within sixty days of Record
Date.
(2) Includes options of 15,834 shares exercisable within sixty days of Record
Date.
(3) Includes options of 160,000 shares exercisable within sixty days of Record
Date.
(4) Includes options of 9,500 shares exercisable within sixty days of Record
Date.
(5) Includes options of 16,250 shares exercisable within sixty days of Record
Date.
(6) Includes a warrant to purchase 7,500 shares and options of 68,326 shares
exercisable within sixty days of Record Date.
(7) Includes options of 18,326 shares exercisable within sixty days of Record
Date.
(8) Includes 276,759 shares held in the name of Safa Trust. Dr. Mirza is an
officer of SAFA Trust. Includes 375,000 shares held by Mar-Jac Investments,
Inc. of which Dr. Mirza is an officer and director and, therefore, may be
deemed to beneficially own such shares. However, Dr. Mirza disclaims
beneficial ownership of all such shares.
(9) Includes options of 30,558 shares exercisable within sixty days of Record
Date.
(10) Includes options of 1,389 shares exercisable within sixty days of Record
Date.
</TABLE>
9
<PAGE>
<TABLE>
<S> <C>
(11) Includes options and or warrants to purchase an aggregate of 506,565 shares
of Common Stock exercisable within 60 days of the Record Date.
(12) The Company relies on a Form 13-D filed by George Valente and group with
the Securities and Exchange Commission on August 10, 1993. The George
Valente and group consist of the following persons and entities: George
Valente, Lena Valente, Green Valley Ford Profit Sharing Trust, Mauro
Valente Trust and Metro Leasing and Investments.
</TABLE>
EXECUTIVE OFFICER COMPENSATION
The Summary Compensation Table sets forth information with respect to
compensation earned for services rendered to the Company during each of the last
three fiscal years for the current and the former Chief Executive Officer and
each of the Company's other most highly compensated executive officers whose
cash compensation exceeded $100,000 in 1994.
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
--------------------------------------- -------------
OTHER SECURITIES
ANNUAL UNDERLYING ALL OTHER
SALARY BONUS COMPENSATION OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) (#) ($)
- --------------------------------- --------- ----------- ----------- ------------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Mr. Al Montross (1) 1994 $ 200,000 $ 398,771 $ 6,480 430,000 $ 0
President and Chief Executive 1993 56,968 14,633 35,000 0 0
Officer
Dr. Parveen Gupta 1994 289,303 0 2,618 265,000 0
Sr. Vice President and 1993 162,635 0 1,800 0 0
General Manager Disk 1992 91,089 0 0 0 0
Array Division
Ms. Colleen Meyers (2) 1994 110,832 20,040 329 60,000 0
Vice President Finance 1993 67,685 10,000 0 0 0
and Chief Financial 1992 42,670 6,667 0 0 0
Officer
Mr. Peter Shambora (3) 1994 137,638 41,741 1,743 50,000 0
Vice President, Sales and 1993 22,069 6,660 0 0 0
Marketing
Mr. Sherman Tom (4) 1994 106,816 24,844 2,119 65,000 0
Vice President, Operations
<FN>
- ------------------------
(1) Mr. Montross joined the Company in September 1993 as Executive Vice
President, was appointed Acting President and Chief Operating Officer in
December 1993 and was appointed President and Chief Executive Officer in
April 1994.
(2) Ms. Meyers was promoted to Chief Financial Officer in December 1993. In
December 1994 she became Vice President Finance and Chief Financial
Officer.
(3) Mr. Shambora joined the Company in October 1993 as Vice President, Sales
and Marketing.
(4) Mr. Tom joined the Company in February 1994 as Vice President, Operations.
</TABLE>
10
<PAGE>
OPTIONS GRANTED IN THE LAST FISCAL YEAR
The following table discloses, for each executive named in the Summary
Compensation Table (the "Named Executives"), options granted during the last
fiscal year and the gain or "spread" that would be realized if the options were
exercised on the expiration date, assuming that the Company's stock had
appreciated at the level indicated, compounded annually over the life of the
options.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
----------------------------------------------------------- VALUE AT ASSUMED
% OF TOTAL ANNUAL RATES OF STOCK
NUMBER OF OPTIONS PRICE APPRECIATION FOR
SECURITIES GRANTED TO EXERCISE OPTION TERMS (1)
UNDERLYING EMPLOYEES IN PRICE EXPIRATION ------------------------
NAME OPTIONS GRANTED (#) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
- ----------------------------- ------------------- --------------- --------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Al Montross.................. 100,000 15.5% $ 5.00 4/28/04 $ 314,447 $ 796,871
30,000 4.6% 10.25 10/17/04 193,385 490,076
Peter Shambora............... 50,000 7.7% 5.00 4/28/04 157,224 398,436
Colleen Meyers............... 30,000 4.6% 6.63 1/27/04 124,993 316,756
10,000 1.5% 5.75 7/27/04 36,161 91,640
Sherman Tom.................. 65,000 10.1% 5.00 4/28/04 204,391 517,966
<FN>
- ------------------------
(1) Potential Realizable value less exercise price.
</TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES
This table discloses the aggregate dollar value realized upon exercise of
stock options in the last fiscal year by each Named Executive, as well as the
total number of unexercised options and the aggregate dollar value of
unexercised options held at the end of the last fiscal year.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT 1993 IN-THE-MONEY OPTIONS AT 1994
SHARES VALUE FISCAL YEAR-END (#) FISCAL YEAR-END ($) (1)
ACQUIRED ON REALIZED -------------------------- ----------------------------
NAME EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------- ------------ ----------- ----------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Al Montross.................... 0 $ 0 60,000 370,000 $ 397,530 $ 2,237,060
Parveen Gupta.................. 0 0 165,000 100,000 1,147,545 731,300
Peter Shambora................. 0 0 12,500 37,500 77,350 232,050
Colleen Meyers................. 0 0 8,334 51,666 57,613 273,667
Sherman Tom.................... 0 0 0 65,000 0 402,220
<FN>
- ------------------------
(1) Total value of options based on fair market value of Company stock of
$11.188 as of December 31, 1994.
</TABLE>
EMPLOYMENT AGREEMENTS
On January 23, 1995 the Company and Mr. Montross agreed upon the basic terms
to be included in his revised employment agreement. The agreement will be
effective January 1, 1995 and extend for a term of four years or through
December 31, 1998. The basic terms as agreed upon provide for an annual salary
of $250,000 and a bonus based upon the Company's profitability. Additionally,
the agreed upon terms include stock options to be granted as follows: 150,000
shares on January 23, 1995, 150,000 shares in January 1996 and 70,000 shares in
January 1997.
11
<PAGE>
EXECUTIVE OFFICERS
The following provides information about the Company's executive officers
who do not also serve as directors:
PARVEEN GUPTA
Dr. Parveen Gupta, age 46 joined the Company in January 1990 as Vice
President, OEM Sales. In April 1993, he was named Vice President and General
Manager, Disk Array Division. In September 1993 he was promoted to Sr. Vice
President and General Manager, Disk Array Division. From May 1989 until January
1990, he served as a general manager for HCL Limited, a computer manufacturer.
From March 1988 through April 1989, he was Sales Manager and Technical Marketing
Manager for Zilog, Campbell, California, responsible for their microprocessor
and computer peripheral products. From October 1986 to November 1987, Dr. Gupta
was Marketing manager of Visual Information Technologies, Plano, Texas, an image
processing and graphic systems company. Prior to that time, he held positions
with United Technologies, Mostek Division, Carrollton, Texas, for six years as
product line manager of the VME Board and System level computer products, and
was with Astronautics Corporation of America, Milwaukee, Wisconsin, for five
years as a design engineer developing high end computer systems. He received a
doctorate in Electrical Engineering from the University of Wisconsin in 1973.
COLLEEN MEYERS
Ms. Colleen Meyers, age 41, joined the Company in April 1992 as Controller
and in December 1993 she was appointed Chief Financial Officer. As of December
1994 she was appointed Vice President Finance and Chief Financial Officer. From
November 1989 until August 1991, she served as Controller of Voicemail
International, Inc., a voice messaging equipment manufacturer. From March 1987
through June 1989, she was Assistant Controller for Alcatel Business Systems,
Inc., a group of computer peripheral manufacturers and telecommunications
companies. From 1978 to 1987, Ms. Meyers held a series of financial management
positions with ITT Courier Terminal Systems of Tempe, Arizona, a computer
peripheral manufacturer. She received a Bachelor of Science degree in Accounting
from Arizona State University.
PETER SHAMBORA
Mr. Shambora, age 51, joined Mylex in October 1993, as Vice President, Sales
and Marketing. Mr. Shambora previously held positions from February 1992 to
October 1993, at Mass Microsystems as Vice President, Sales and Marketing and
from January 1987 to February 1992, at Storage Dimensions as Vice President,
Worldwide Sales. Prior to these positions, Mr. Shambora held positions at
various technology companies, including companies such as; Atasi, Four Phase
Systems and Ampex. He also served in the U.S. Navy for 10 years as a Naval
Aviation Officer and departed with the rank of Lieutenant Commander. Mr.
Shambora received his undergraduate degree from San Jose State University in
Industrial Management and a Masters degree from the University of Southern
California in Systems Management. He has also taught and lectured on
international business.
SHERMAN W. TOM
Mr. Sherman W. Tom, age 40, joined the Company in February 1994, as Vice
President of Operations. From October 1988 until July 1993, he served as Vice
President of Operations for Ultra Network Technologies, a manufacturer of high
performance network products and services. From December 1984 until August 1988,
he held positions of Director, Manufacturing Technology & Engineering Services
and Director, Subsystems Manufacturing Group for Silicon Graphics Computer
systems. Prior to his employment with Silicon Graphics, from 1976 to 1984, Mr.
Tom was involved in senior management and technical positions in emerging
technology companies, including six years with Gould Inc., Biomation Division.
He attended West Valley College and San Jose State University where he studied
business and industrial technology.
12
<PAGE>
KRISHNAKUMAR RAO SURUGUCCHI
Mr. Surugucchi, age 39, joined the Company in February 1992, as Director of
Hardware Engineering. He was promoted to Vice President of Engineering in July
1994. Prior to joining the Company, Mr. Surugucchi was Director of Engineering
for the Company's subsidiary, Mylex, India from April 1991 to February 1992.
Prior to these positions, Mr. Surugucchi was Deputy General Manager for PSI,
India from November 1979 to March 1991. Mr. Surgucchi received his undergraduate
degree and masters degree in Electrical Engineering from The Indian Institute of
Technology, Bombay, India in 1977 and 1979 respectively.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On July 17, 1992, a group of investors (the "Investors"), purchased a
majority interest in Northgate Computer Systems, Inc. ("Northgate") for $1.3
million. As a result of this transaction, two current directors, Dr. Mirza, and
Mr. Love were appointed to the membership of Northgate's Board of Directors in
July of 1992. One former director of the Company, Dr. M. Akram Chowdry was
appointed to the Northgate board in September 1992 and later became chairman.
Mr. Dudhia was appointed Chairman of Northgate's Board in November 1993. Mr.
Love resigned from the Northgate Board in September 1993, shortly after election
to the Company's Board. Dr. Chowdry resigned from the Northgate Board in August
1993 and Dr. Mirza and Mr. Dudhia each resigned from the Northgate Board in
April 1994. The Company, as an entity, has no equity interest in Northgate,
however, the Company did have an ongoing business relationship with Northgate
pursuant to which Northgate had purchased products from the Company at the
prices established by the Company for other third party purchasers who buy
similar quantities of products. During 1992 and the first seven months of 1993,
the Company provided commercial credit to Northgate for such purchases. For the
year ended December 31, 1994, sales to Northgate totaled $64,866.
The Company in 1994 utilized the services of the business firm, Saicom,
owned by the wife of officer Dr. Parveen Gupta, for software duplication and
printing of product manuals. Products were obtained for competitive
pricing/quantities. All transactions were completed in the normal course of
business and the Company paid $101,717 for Saicom services in 1994 This
relationship was terminated in 1994.
On January 23, 1995 the Company and Mr. Montross agreed upon the basic terms
to be included in his revised employment agreement. The agreement will be
effective January 1, 1995 and extend for a term of four years or through
December 31, 1998. The basic terms as agreed upon provide for an annual salary
of $250,000 and a bonus based upon the Company's profitability. Additionally,
the agreed upon terms include stock options to be granted as follows; 150,000
shares on January 23, 1995, 150,000 shares in January 1996 and 70,000 shares in
January 1997.
13
<PAGE>
COMPENSATION COMMITTEE REPORT
The Compensation Committee (the "Committee") of the Board of Directors
establishes the general compensation policies of the Company as well as the
compensation plans and specific compensation levels for executive officers. In
addition, it administers the Company's employee stock option plans. The
Committee is currently composed of three independent, non-employee directors.
The Committee believes that the compensation of the executive officers,
including that of the Chief Executive Officer (collectively, the "Executive
Officers") should be influenced by the Company's performance. The Committee
establishes the salaries of all the Executive Officers by considering (1) the
salaries of executive officers in similar positions of comparably-sized
companies, (2) the Company's financial performance for the past year as
described below, and (3) the achievement of certain objectives related to the
particular Executive Officer's area of responsibility. Key target performance
objectives used in determining executive compensation include the attainment of
certain levels of revenue and operating income, as specified by the Committee.
Base salaries for Executive Officers other than the Chief Executive Officer are
set by the Committee, in consultation with the Chief Executive Officer.
The Company has adopted an Executive Bonus Plan. The purposes of the
Executive Bonus Plan are to tie compensation to achievement on performance
measures that influence shareholder value creation, and to ensure payments are
targeted to provide a competitive level of compensation, taking into account the
Company's performance against its revenue and operating income objectives, which
are set annually by the Committee. The Company achieved its operating income
objectives in 1994, and as a result paid a bonus to the Chief Executive Officer
of $398,771 and a total of $86,625 to other officers named in the Summary
Compensation Table.
The Company's 1993 Stock Option Plan provides for long-term incentive
compensation for employees of the Company, including Executive officers. An
important objective of the plan is to provide additional incentives to employees
to work to maximize shareholder value. The option program utilizes vesting
period to encourage retention of employees and executive officers, and reward
long-term commitment to employment with the Company. The Board, in consultation
with the Committee and the Chief Executive Officer, is responsible for
determining, subject to the terms of the Option Plan, the individuals to whom
grants should be made, the timing of grants, the exercise price per share, and
the number of shares subject to each grant.
The terms of the President and Chief Executive Officer's compensation plan
provides for (1) competitive base salary, (2) participation in the Executive
Bonus Plan payable on the achievement of certain operating income objectives and
(3) grants of options to purchase shares of Common Stock of the corporation,
vesting at a stated percentage per year. In addition, among the factors the
Committee considered in setting the Chief Executive Officer's salary was the
development of new products. For the other officers of the Company, a cash bonus
is determined by the Board of Directors based upon the achievement of certain
revenue and operating income targets similar to those in place for the Chief
Executive Officer, which bonus arrangements would be allocated among the
officers of the corporation at the discretion of, and in such amounts as
determined by the Board of Directors.
Mr. Ismael Dudhia
Mr. Richard Love
Dr. Inder Singh
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Directors Mr. Dudhia, Mr. Love and Dr. Singh comprise the Compensation
Committee.
Mr. Love is the current Treasurer of the Company and was appointed in
January 1995.
Dr. Singh was Treasurer of the Company from February 1989 to November 1989.
14
<PAGE>
PERFORMANCE GRAPH FOR MYLEX CORPORATION
6 YEAR CUMULATIVE TOTAL RETURN
MYLEX CORPORATION, NASDAQ MARKET (USA)
AND NASDAQ COMPUTER MANUFACTURER STOCK (#357)
EDGAR REPRESENTATION OF GRAPHIC PLOT POINTS
<TABLE>
<CAPTION>
FISCAL YEAR END
---------------------------------------------------------------------------
1988 1989 1990 1991 1992 1993 1994
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Mylex 100.00 83.33 100.00 146.67 326.67 353.33 596.69
NASDAQ
Market (USA) 100.00 143.86 122.51 183.94 213.90 243.98 238.78
NASDAQ
Computer Manufacturer 100.00 102.75 109.73 167.47 225.11 213.33 234.40
</TABLE>
- ------------------------
NOTE: Assumes $100 invested on 12/31/88 in Mylex Corporation, NASDAQ Market
(USA) and NASDAQ Computer Manufacturer Stock. Assumes reinvestment of dividends
on a daily basis.
15
<PAGE>
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires the Company's officers and
directors, and persons who own more than ten percent of registered class or the
Company's equity securities, to file certain reports of ownership with the
Security and Exchange Commission (the "SEC"). Such officers, directors and
shareholders are also required by SEC rules to furnish the Company with copies
of all Section 16(a) forms that they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons, the Company believes
that Mr. Montross and Ms. Meyers failed to timely report grants of shares of the
Company's Common Stock. Such grants were subsequently reported on Form 5's.
The Company believes the items set forth in the foregoing reporting
disclosure are technical in nature, and the transactions that were not reported
on a timely basis, did not involve violations of the trading prohibition set
forth in Section 16(b) of the Exchange Act.
OTHER MATTERS
Management does not intend to bring before the meeting any matters other
than those set forth herein, and has no present knowledge that any other matters
will or may 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 enclosed form of Proxy to vote the proxies in accordance with their
judgment.
ON BEHALF OF THE BOARD OF DIRECTORS
[SIG]
Al Montross
PRESIDENT AND CHIEF EXECUTIVE OFFICER
16
<PAGE>
MYLEX CORPORATION
PROXY FOR 1995 ANNUAL MEETING OF SHAREHOLDERS
------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder of MYLEX CORPORATION, a Florida corporation,
hereby acknowledges receipt of the Notice of Annual Meeting of Shareholders and
Proxy Statement, each dated March 23, 1995, and hereby appoints Mr. Al Dudhia
and Mr. Montross, or either of them, with full power of substitution to vote and
otherwise represent all of the shares registered in the name of the undersigned
at the 1995 Annual Meeting of Shareholders of MYLEX CORPORATION to be held on
April 24, 1995, at 2:00 p.m., local time, at 34551 Ardenwood Blvd., Fremont,
California, 94555, and at any adjournment or adjournments thereof, with the same
effect as if the undersigned were present and voting such shares, on the matters
set forth below:
<TABLE>
<S> <C> <C>
1. Election of FOR all nominees listed below WITHHOLD AUTHORITY to vote
directors. (except as marked to the contrary below) / / for all nominees listed below / /
</TABLE>
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A
LINE THROUGH THAT NOMINEE'S NAME IN THE LIST BELOW.)
Mr. Al Montross, Dr. Inder M. Singh, Dr. M. Yaqub Mirza, Mr. Ismael Dudhia, Mr.
Richard Love, Mr. Stephen McKenzie
2. To amend the Company's 1993 Stock Option Plan to increase the number of
shares available thereunder by 700,000 shares.
FOR / / AGAINST / / ABSTAIN / /
3. To ratify the appointment of KPMG Peat Marwick LLP as independent public
accountants of the Company for the fiscal year ending December 31, 1995.
FOR / / AGAINST / / ABSTAIN / /
4. To transact such other business as may properly come before the meeting
or any adjournments thereof.
FOR / / AGAINST / / ABSTAIN / /
(CONTINUED AND TO BE SIGNED ON OTHER SIDE)
<PAGE>
(CONTINUED FROM OTHER SIDE)
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATION MADE. IF NO SPECIFICATION IS MADE, THE SHARES REPRESENTED BY THIS
PROXY WILL BE VOTED FOR EACH OF THE ABOVE PERSONS AND PROPOSALS, AND FOR SUCH
OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING AS THE PROXY HOLDERS DEEM
ADVISABLE.
_______________________________
(Name typed or printed)
_______________________________
(Signature)
_______________________________
(Title, if appropriate)
Date: ___________________, 1995
I plan to attend the
meeting: Yes / / No / /
Sign exactly as your name(s)
appears on your stock
certificate. A corporation is
requested to sign its name by
its President or other
authorized officer with the
office held designated.
Executors, administrators,
trustees, etc., are requested
to so indicate when signing. If
stock is registered in two
names, both should sign.
TO ASSURE YOUR REPRESENTATION AT THE ANNUAL MEETING, PLEASE MARK, SIGN AND DATE
THIS PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
