<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] 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 Rule 14a-11(c) or Rule 14a-12
OIS OPTICAL IMAGING SYSTEMS, INC.
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
___________________________________________________________________
2) Aggregate number of securities to which transaction applies:
___________________________________________________________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
___________________________________________________________________
4) Proposed maximum aggregate value of transaction:
___________________________________________________________________
5) Total fee paid:
___________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
___________________________________________________________________
2) Form, Schedule or Registration Statement No.:
___________________________________________________________________
3) Filing Party:
___________________________________________________________________
4) Date Filed:
___________________________________________________________________
<PAGE> 2
OIS OPTICAL IMAGING SYSTEMS, INC.
47050 Five Mile Road
Northville, Michigan 48167
Dear Stockholder:
The Annual Meeting of the Stockholders of OIS Optical Imaging Systems,
Inc. will be held at 10:00 a.m. on November 9, 1995, at Laurel Manor Banquet
and Conference Center, 39000 Schoolcraft, Livonia, Michigan 48150, in the
Aspen meeting room. You are cordially invited to attend.
At the Annual Meeting, Stockholders will vote to elect directors and vote
on the approval of independent accountants.
OIS's Annual Report to Stockholders and the Proxy Statement for the
Annual Meeting are enclosed. Whether or not you will be able to attend the
Annual Meeting, please complete, sign, date, and return the enclosed proxy card
in the accompanying postage paid envelope so that your shares will be voted at
the meeting.
Sincerely yours,
Rex Tapp
President and Chief Executive Officer
Charles C. Wilson
Executive Vice President and
Chief Financial Officer
<PAGE> 3
OIS OPTICAL IMAGING SYSTEMS, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Northville, Michigan
October 2, 1995
To the Stockholders of OIS OPTICAL IMAGING SYSTEMS, INC.:
NOTICE is hereby given that the Annual Meeting of Stockholders of OIS
Optical Imaging Systems, Inc., a Delaware corporation, will be held on
Thursday, November 9, 1995, at 10:00 a.m., local time, at Laurel Manor Banquet
and Conference Center, 39000 Schoolcraft, Livonia, Michigan 48150, in the
Aspen meeting room, for the following purposes:
1. To elect eight directors to hold office until the next Annual
Meeting of Stockholders or until their successors are elected and
qualified;
2. To approve the appointment of Arthur Andersen LLP as independent
public accountants for the fiscal year ending June 30, 1996; and
3. To transact such other business as may properly come before the
meeting or any adjournment.
Stockholders of record at the close of business on September 18, 1995
(the "Record Date"), are entitled to notice of, and to vote at, the Annual
Meeting and any adjournments or postponements thereof.
OIS's Annual Report to Stockholders for the year ended June 30, 1995, is
enclosed.
THE BUSINESS OF THIS MEETING IS VERY IMPORTANT. PLEASE COMPLETE, SIGN,
DATE AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING POSTAGE PAID ENVELOPE.
You are invited to attend the meeting where you may vote in person even though
you have already signed and returned a Proxy.
Sincerely yours,
David B. Jaffe
Corporate Secretary
<PAGE> 4
OIS OPTICAL IMAGING SYSTEMS, INC.
47050 FIVE MILE ROAD
NORTHVILLE, MICHIGAN 48167
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 9, 1995
The enclosed Proxy is solicited on behalf of the Board of Directors of
OIS Optical Imaging Systems, Inc. ("OIS") for use at OIS's Annual Meeting of
Stockholders ("Annual Meeting" or "Meeting") to be held on Thursday, November
9, 1995, at 10:00 a.m., local time, or at any adjournments or postponements
thereof, for the purposes set forth herein and in the accompanying Notice of
Annual Meeting of Stockholders. The Meeting will be held at the above time in
the Aspen meeting room at Laurel Manor Banquet and Conference Center, 39000
Schoolcraft, Livonia, Michigan 48150.
Voting Rights of Stockholders and Voting of Proxies
As of the close of business on September 18, 1995 (the "Record Date"),
there were outstanding 96,721,635 shares of OIS's Common Stock,
$0.01 par value ("Common Stock"). Holders of record of the Common Stock on the
Record Date are entitled to vote at the Meeting and are entitled to one vote
for each share of Common Stock held on the Record Date. The holders of a
majority of the shares entitled to vote, present in person or represented by
proxy, will constitute a quorum for the transaction of business at the Meeting.
Proxies will be voted in accordance with the directions of the stockholders.
Unless a stockholder specifies otherwise, the proxy will be voted:
FOR: each of the eight nominees for director;
FOR: the appointment of Arthur Andersen LLP as independent public
accountants; and
by the proxy in his or their discretion on any other matters to come
before the Meeting.
Revocability of Proxies
Any proxy given pursuant to this solicitation may be revoked by the
person giving it at any time before its use by delivering to the Secretary of
OIS a written notice of revocation or a duly executed proxy bearing a later
date or by attending the Meeting and voting in person. The mailing address of
OIS is 47050 Five Mile Road, Northville, Michigan 48167.
Expenses and Methods of Solicitation
It is estimated that these proxy solicitation materials will be mailed to
stockholders of record on or about October 2, 1995. The cost of this
solicitation will be borne by OIS. In addition to solicitation by mail,
directors, officers and other employees of OIS may solicit proxies personally
or by telephone or other means of communication. Arrangements may be made with
brokerage houses and other custodians, nominees and fiduciaries to forward, at
the expense of OIS, copies of the proxy materials to the beneficial owners of
shares held of record by such persons. OIS has retained Morrow & Co., Inc. to
aid in the solicitation of proxies, which company will receive a fee of $3,000
plus reimbursement of expenses, all of which will be borne by OIS.
Other Information
OIS's Annual Report to Stockholders for the year ended June 30, 1995
accompanies this Proxy Statement.
OIS WILL PROVIDE TO ANY STOCKHOLDER OIS'S ANNUAL REPORT ON FORM 10-K FOR
THE YEAR ENDED JUNE 30, 1995, WITHOUT CHARGE, AND THE EXHIBITS TO ITS ANNUAL
REPORT ON FORM 10-K FOR THE YEAR ENDED JUNE 30, 1995, AT A COPYING CHARGE OF
TWENTY CENTS PER PAGE, UPON WRITTEN REQUEST TO OIS OPTICAL IMAGING SYSTEMS,
INC., 47050 FIVE MILE ROAD, NORTHVILLE, MICHIGAN 48167, ATTENTION: STOCKHOLDER
RELATIONS, (313) 454 - 5560.
- 1 -
<PAGE> 5
SUMMARY OF PROPOSALS
Election of Directors
Currently, the OIS By-laws permit the Board of Directors (the "Board") to
consist of "one or more members." The Board of Directors has nominated eight
persons for election as directors, five of whom are designees of Guardian
Industries Corp.
Appointment of Independent Public Accountants
The stockholders will also be asked to approve the appointment of Arthur
Andersen LLP as independent public accountants for the fiscal year ending June
30, 1996.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners
The following table shows, as of September 18, 1995, the persons known to
OIS to be beneficial owners of more than five percent (5%) of OIS's voting
shares. The table includes shares issuable under options that may be exercised
within sixty (60) days.
<TABLE>
<CAPTION>
Amount and Percent
Nature of of
Name and Address Beneficial Ownership Class
- ---------------- -------------------- -----
<S> <C> <C>
Guardian Industries Corp. 51,835,048 53.6%
2300 Harmon Road
Auburn Hills, MI 48326
William Davidson 78,660,451(1) 81.3%
2300 Harmon Road
Auburn Hills, MI 48326
</TABLE>
Footnote to the table of security ownership of certain beneficial owners:
(1) Of these shares, William Davidson owns outright 26,825,403 shares and is
deemed to beneficially own all of the shares owned by Guardian.
Security Ownership of Management
The following table shows, as of September 18, 1995, the beneficial
ownership of shares of OIS Common Stock by each director, each executive
officer named in the Summary Compensation Table, and executive officers and
directors as a group. All shares are owned directly except as otherwise
indicated.
<TABLE>
<CAPTION>
Name of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership (1) of Class (2)
- ---------------- -------------------- --------
<S> <C> <C>
Vincent D. Cannella 45,850 (3) (9)
Curtis J. Casey 20,500 (4) (9)
Ralph J. Gerson 15,500 (9)
Jeffrey A. Knight 310,000 (5) (9)
Fang-Chen Luo 68,100 (6) (9)
C.K. Prahalad -0-
Rex Tapp 28,900 (7) (9)
Robert M. Teeter -0-
Charles C. Wilson 29,100 (8) (9)
Mark S. Wrighton -0-
Peter Joel C. Young 41,000 (9)
All executive officers
and directors as a
group (13 persons) 558,950 (9)
</TABLE>
- 2 -
<PAGE> 6
Footnotes to the table of security ownership of management:
(1) Under the rules of the Securities and Exchange Commission, a person is
deemed to be the beneficial owner of a security if that person has the
right to acquire beneficial ownership of such security within 60 days,
whether through the exercise of options or warrants or through the
conversion of another security.
(2) Under the rules of the Securities and Exchange Commission, shares of OIS
Common Stock issuable upon exercise of options and warrants or upon
conversion of securities which are deemed to be beneficially owned by the
holder thereof (See Note (1) above) are deemed to be outstanding for the
purpose of computing the percentage of outstanding securities of the
class owned by such person (but are not deemed to be outstanding for the
purpose of computing the percentage of the class owned by any other
person). The calculation of percent of class is computed, in accordance
with the Rules of the Securities and Exchange Commission, on the basis of
the number of shares actually outstanding on September 18, 1995, plus the
number of shares subject to options that could be exercised within 60
days.
(3) Of these shares, 28,200 represent exercisable options; 12,150 represent
restricted stock, which Mr. Cannella will forfeit if he does not remain a
employee through October 13, 1997 (with respect to 1,300 shares), 1996
(with respect to 8,000 shares) and 1995 (with respect to 2,850 shares);
5,450 are owned directly by Mr. Cannella, and 50 are owned by Mr.
Cannella's children.
(4) Of these shares, 5,000 represent exercisable options and 20,000 are owned
directly by Mr. Casey.
(5) Of these shares, Jeffrey A. Knight owns outright 3,000 shares. In
addition, 307,000 shares are owned indirectly by Jeffrey A. Knight as a
general partner of a partnership which has a 0.5% interest in OIS. Mr.
Knight disclaims beneficial ownership of such shares held by the
partnership.
(6) Of these shares, 45,500 represent exercisable options and 22,600 shares
represent restricted stock, which Mr. Luo will forfeit if he does not
remain an employee through October 13, 1997 (with respect to 2,300
shares), 1996 (with respect to 15,000 shares,) and 1995 (with respect to
5,300 shares).
(7) Of these shares, 7,500 represent exercisable options; 21,400 represent
restricted stock, which Mr. Tapp will forfeit if he does not remain an
employee through October 13, 1997 (with respect to 3,100 shares), 1996
(with respect to 12,500 shares), and 1995 (with respect to 5,800 shares).
(8) Of these shares 6,000 represent exercisable options, 23,100 represent
restricted stock, which Mr. Wilson will forfeit if he does not remain an
employee through October 13, 1997 (with respect to 2,800 shares), 1996
(with respect to 15,000 shares), and 1995 (with respect to 5,300 shares).
(9) Less than 1%.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Purchase of Preferred Stock
The Board of Directors of OIS authorized the issuance of 25,000 shares
of a Series A Cumulative Preferred Stock, par value $0.01 (the "Preferred
Stock"). The Preferred Stock is not convertible into common stock or any other
security, and is non-voting (except in limited circumstances relating to the
rights of the Preferred Stock). The Preferred Stock bears a cumulative
dividend at an annual rate of 8% for five years from the date of issuance and
at an increasing floating rate (subject to a cap of 16.5%) thereafter. The
purchaser of Preferred Stock cannot cause its redemption, and OIS can redeem
Preferred Stock only upon a vote of the directors of OIS that are independent
of the owner or owners of the Preferred Stock being redeemed.
During fiscal 1995 Guardian Industries Corp. ("Guardian") purchased
12,500 shares of Preferred Stock for an aggregate purchase price of
$12,500,000. In addition, Guardian purchased an additional 6,250 shares of
Preferred Stock for an aggregate purchase price of $6,250,000 on September
20, 1995. These investments by Guardian were approved by the disinterested
members of OIS's Board of Directors. The investments in Preferred Stock are
accounted for as equity.
Services Agreement
In April 1992, OIS and Guardian entered into a Services Agreement, which
was amended in July 1992, November 1994 and June 1995. Under the amended
Services Agreement, Guardian provides certain administrative, accounting,
technical, travel arrangement, management and tax services for $50,000 per year
and provides legal services through its corporate legal department at an hourly
rate of $100. Since becoming president of OIS in April 1992, Rex Tapp had
remained an employee of Guardian with his services being provided to OIS by
Guardian under the Services Agreement. However, effective July 1, 1995, Mr.
Tapp ceased
- 3 -
<PAGE> 7
to be an employee of Guardian and became an employee of OIS with the result
that his services to OIS are no longer subject to the Services Agreement.
Engineering Services Agreement
In May 1993, OIS and Guardian entered into an Engineering Services
Agreement under which employees at Guardian are providing construction
management services in connection with OIS's new manufacturing facility in
Northville Township, Michigan. Under the Engineering Services Agreement, OIS
reimburses Guardian for the cost of the employees providing the services,
including salary, taxes and fringe benefits, on an hourly basis. The
Engineering Services Agreement provides that the aggregate amount paid by OIS
thereunder will not exceed $250,000 without the approval of the independent
directors of OIS.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
Policies Applicable to Compensation of Executive Officers
The compensation of executive officers other than the Company's President
and Chief Executive Officer, Rex Tapp, is determined by Mr. Tapp in
consultation with the Compensation Committee. Before the end of each fiscal
year and again before bonuses are determined, Mr. Tapp meets with the
Compensation Committee and discusses the overall compensation situation of the
Company, the range of increases he proposes to implement and any special
circumstances present. Mr. Tapp makes compensation determinations for
executive officers on a subjective basis, taking into account the financial
performance (i.e., the ongoing losses) of the Company, the performance reviews
and individual compensation history of each individual executive officer, the
range of comparable salaries from other companies in the Company's geographic
region as well as other semiconductor salaries from other companies of similar
size as the Company, and other factors that he considers relevant. The
information on comparable salaries is drawn from general published survey
information and does not relate specifically to the companies included in the
industry line of the performance graph. The Company's compensation of
executive officers is, on average, in the median range of surveyed companies.
No one factor is accorded more weight than any other. Although corporate
performance is taken into consideration, there is no formal or formulaic
relationship between corporate performance and executive compensation and no
performance targets have been set. The Company feels that this relatively
informal method of determining executive compensation is appropriate given the
current stage of development of the Company's business.
Salary adjustments for executive officers are made effective as of July 1
of each year and bonuses are awarded each December. In fiscal 1993 and 1994,
bonuses for executive officers consisted solely of awards of restricted stock
which are required to be forfeited if the officer's employment terminates
within a specified period after the grant. In fiscal 1995, executive officers
received stock options which were awarded in March 1995. It is expected that
in the future awards of stock options will be made on the regular December
schedule. The number of shares of restricted stock awarded to each executive
officer is determined by taking the dollar value of the bonus proposed to be
given and dividing that amount by the fair market value per share on the date
of grant. Restricted stock grants made in prior years are not taken into
account when determining grants to be made in the current year. Mr. Tapp
determined the levels of salary increases and bonuses on a subjective basis,
taking into account all of the factors discussed above. Awards of restricted
stock and stock options are made by the Stock Option Committee of the Board
after its receipt of recommendations from Mr. Tapp.
The salary adjustments and bonuses were lower than they would have been
had the Company not incurred significant losses.
No executive officer receives annual compensation that approaches $1
million, and the Company does not anticipate compensation approaching $1
million in the foreseeable future. Accordingly, the Compensation Committee has
not considered the recent change in the tax laws which made certain
non-performance based compensation to executives of public companies in excess
of $1 million non-deductible.
CEO Compensation
Until June 30, 1995, Mr. Tapp was an employee of Guardian which provided
Mr. Tapp's services to the Company pursuant to a services agreement between the
Company and Guardian. See "Certain Relationships and Related Transactions."
Mr. Tapp's compensation for both work performed for OIS, as well as work
performed for Guardian, was determined by Guardian which is a privately held
company. Guardian paid Mr. Tapp's cash compensation and provided his fringe
benefits. Guardian's President and Chief Executive Officer, William Davidson,
made compensation determinations with respect to Mr. Tapp in his discretion.
Guardian did not utilize a systematic method of measuring Mr. Tapp's
performance, and Mr. Davidson's
- 4 -
<PAGE> 8
compensation decisions have been subjective. While the Company's Compensation
Committee reviews the compensation determination made by Guardian, it does not
participate in that decision.
In 1994, the Compensation Committee made a restricted stock award to Mr.
Tapp on the basis of Mr. Davidson's recommendation. Mr. Davidson did not give
an explanation of the basis for his recommendation.
Effective July 1, 1995, Mr. Tapp has become an employee of OIS and ceased
to be an employee of Guardian. The services agreement between Guardian and OIS
has been amended so that OIS no longer pays Guardian for Mr. Tapp's services.
Accordingly, beginning with fiscal 1996, Mr. Tapp's compensation is determined
by the Compensation Committee.
The Compensation Committee has determined to apply the Company's informal
method of compensation determination to Mr. Tapp. The Chairman of the Board,
Ralph J. Gerson, will make compensation recommendations to the Compensation
Committee before the July salary adjustment and the December bonus
determination. Although Mr. Tapp received cash bonuses from Guardian, the
Compensation Committee has determined in light of the Company's ongoing losses
that OIS will not pay cash bonuses to Mr. Tapp.
Mr. Gerson will make his recommendations on a subjective basis, taking
into account the financial performance (i.e., the ongoing losses) of the
Company, his subjective view of Mr. Tapp's job performance, Mr. Tapp's
compensation history, the Company's financial performance and other factors
that he considers relevant. In addition, the Compensation Committee has
undertaken to review periodically information concerning the compensation of
chief executive officers at similar companies, but that first such review has
not yet taken place and its scope has not yet been precisely determined. The
Compensation Committee will take the results of those reviews into account in
determining Mr. Tapp's compensation.
The Compensation Committee does not expect to accord any one factor more
weight than any other. Although corporate performance will be taken into
account, and Mr. Tapp's compensation is lower than it would be if the Company
had not incurred significant losses, the Compensation Committee will not apply
any formal or formulaic relationship between corporate performance and Mr.
Tapp's compensation and no formal targets have been set. The Compensation
Committee believes that this relatively informal method of determining the
compensation of the chief executive officer is appropriate given the current
stage of development of the Company's business.
COMPENSATION COMMITTEE
Ralph J. Gerson
Mark S. Wrighton
EXECUTIVE COMPENSATION
The following table shows the 1995 fiscal year compensation of the Chief
Executive Officer and the four other most highly compensated executive officers
of OIS (collectively, the "Named Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
---------------------------------------------------------------------
Awards Payouts
----------------------------------
Other All
Annual Restricted Other
Name and Compen- Stock Options/ LTIP Compen-
Principal Salary Bonus sation Awards(1) SARs Payouts sation
Position Year ($) ($) ($) ($) (#) ($) ($)
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Rex Tapp, CEO & 1995 $181,512 $35,992 (3) $20,150(4) 15,000
President(2) 1994 $104,000 $27,500 (3) $17,400(4)
1993 $ 91,000 $27,315 (3) $10,938(4)
Charles C. Wilson, 1995 $131,365 $18,200(5) 12,000 $12,685(9)
Executive Vice 1994 $128,135 $15,900(5) $12,686(9)
President & CFO 1993 $119,000 $13,125(5)
</TABLE>
- 5 -
<PAGE> 9
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Fang-Chen Luo, 1995 $138,106 $14,950(6) $8,561(9)
Vice President 1994 $121,058 $15,900(6) 11,000 $8,651(9)
of Research 1993 $115,000 $13,125(6)
and Development
Vincent D. Cannella, 1995 $101,368 $5,250 $8,450(7) 10,000 $10,432(9)
Vice President 1994 $99,692 $8,550(7) $19,859(9)
1993 $96,000 $7,000(7) $10,500(9)
Curtis J. Casey, Vice 1995 $113,614 10,000 $12,146(9)
President of Marketing 1994 $75,192 $70,000(8) $12,500(9)
and Business 1993 -0- -0-
Development
</TABLE>
Footnotes to the table of compensation of Named Officers:
(1) Represents the market value of restricted stock on the date of grant.
(2) Until July 1, 1995, Mr. Tapp was an employee of Guardian, and this table
shows amounts paid to Mr. Tapp by Guardian, except for restricted stock,
which was granted by OIS. Under the Guardian-OIS Services Agreement, OIS
paid $80,000 to Guardian for Mr. Tapp's services during fiscal 1993, 1994
and 1995 (which amount is not in addition to the amounts shown in the
table). See: Certain Relationships and Related Transactions.
(3) The aggregate amount of other compensation is less than 10% of the total
of salary and bonus.
(4) As of June 30, 1995 Mr. Tapp held 21,400 restricted shares with a market
value of $109,675.
(5) As of June 30, 1995 Mr. Wilson held 23,100 restricted shares with a
market value of $118,388.
(6) As of June 30, 1995 Mr. Luo held 22,600 restricted shares with a market
value of $115,825.
(7) As of June 30, 1995 Mr. Cannella held 12,150 restricted shares with a
market value of $62,269.
(8) As of June 30, 1995 all of Mr. Casey's restricted shares had vested and
had a market value of $117,500.
(9) Amount is for the cost of premiums paid for split-dollar life insurance
provided by the Company.
The following tables show grants, exercises and fiscal year-end values of stock
options for the Named Officers.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential Realizable Value
At Assumed Annual
Rates of Stock Option
Individual Grants Appreciation for Option Term
---------------------------------------------------------------------------------------------------- -----------------------------
Number of % of Total
Securities Options/SARs
Underlying Granted to Exercise
Options/SARs Employees or Base Expiration
Name Granted (#)(1) In Fiscal Year Price ($/Sh) (2) Date 5% ($) 10% ($)
---- ----------------- -------------- ------------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Rex Tapp, 15,000 13.9 $5.375 March 8, 2005 $22,275 $49,222
President & CEO
Charles C. Wilson, 12,000 11.1 $5.375 March 8, 2005 $17,820 $39,378
Executive Vice President
& CFO
Fang-Chen Luo, 11,000 10.2 $5.375 March 8, 2005 $16,335 $36,096
Vice President of
Research and Development
Vincent D. Cannella, 10,000 9.3 $5.375 March 8, 2005 $14,850 $32,815
Vice President
</TABLE>
- 6 -
<PAGE> 10
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Curtis J. Casey, Vice 10,000 9.3 $5.375 March 8, 2005 $14,850 $32,815
President of Marketing
and Business Development
</TABLE>
Footnotes to table of option grants for last fiscal year:
(1) These options become exercisable with respect to 50% of the underlying
shares on September 9, 1995 and 1996, respectively.
(2) These options were granted at the market price of the shares on the date
of grant.
- 7 -
<PAGE> 11
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END
OPTION/SAR VALUES
<TABLE>
<CAPTION>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs at
at FY-End (#) FY-End ($)
Shares
Acquired Exercisable/ Exercisable/
Name on Exercise Value Realized ($) Unexercisable Unexercisable
(#)
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Rex Tapp, President & CEO -0- -0- 0/15,000 -0-
Charles C. Wilson, Executive -0- -0- 0/12,000 -0-
Vice President & CFO
Fang-Chen Luo, Vice -0- -0- 20,000/41,000 $57,500/86,250
President of Research
and Development
Vincent D. Cannella, -0- -0- 23,200/15,800 $66,700/16,675
Vice President
Curtis J. Casey, Vice -0- -0- 0/10,000 -0-
President of Marketing
and Business Development
</TABLE>
The following graph compares the five-year cumulative total return to the
shareholders of OIS to Standard and Poor's Midcap 400 Index and Standard and
Poor's Electronics (Semiconductor) Index.
<TABLE>
<CAPTION>
INDEXED RETURNS
YEARS ENDING
COMPANY/INDEX JUN91 JUN91 JUN92 JUN93 JUN94 JUN95
=============================================================================================================
<S> <C> <C> <C> <C> <C>
OIS OPTICAL IMAGING SYSTEMS 100 34.48 34.98 53.43 151.72 141.38
S&P MIDCAP 400 INDEX 100 112.84 133.78 164.13 164.03 200.68
ELECTRONICS (SEMICONDUCTORS) 100 89.38 105.06 220.07 232.91 439.49
</TABLE>
PREPARED BY STANDARD & POOR'S COMPUSTAT - CUSTOM BUSINESS UNIT - 8/9/95
- 8 -
<PAGE> 12
PROPOSAL I
ELECTION OF DIRECTORS
The Board proposes that the persons named below be elected as directors
of OIS to hold office until the next Annual Meeting of Stockholders and until
their successors are duly elected and qualified. Unless otherwise directed by
a stockholder's proxy, the persons named as proxy voters in the accompanying
proxy will vote for the nominees named below. If any of such nominees become
unavailable, which is not anticipated, the Board in its discretion may
designate substitute nominees, in which event the enclosed proxy will be voted
for such substitute nominee. A vacancy unfilled at the Annual Meeting or a
vacancy created thereafter can be filled by the Board. Proxies cannot be voted
for a greater number of persons than the number of nominees named. Provided a
quorum is present, the affirmative vote of a majority of the shares of OIS
present in person or proxy is required to elect each director.
The following information is furnished with respect to each nominee for
election as a director:
<TABLE>
<CAPTION>
Position Held Year First Became
Name Age with OIS a Director
---- --- -------- ----------
<S> <C> <C> <C>
Rex Tapp 45 President, Chief Executive 1991
Officer & Director
Charles C. Wilson 43 Executive Vice President, 1991
Chief Financial Officer &
Director
Ralph J. Gerson 45 Chairman & Director 1992
Jeffrey A. Knight 44 Director 1991
C.K. Prahalad 54 Director 1995
Robert M. Teeter 56 Director 1995
Mark S. Wrighton 46 Director 1995
Peter Joel C. Young 35 Director 1991
</TABLE>
Rex Tapp was first elected to the Board of Directors in November 1991 and
is a Guardian designee. Mr. Tapp has been the President of OIS since December
1991 and until this year has also been the Director of Technical Development
for Guardian. Effective July 1, 1995, Mr. Tapp ceased being an employee of
Guardian and became an employee of OIS.
Charles C. Wilson was first elected to the Board of Directors in November
1991 and is a Guardian designee. Mr. Wilson has been OIS's Executive Vice
President and Chief Financial Officer since November 1991. From July 1987
until joining OIS, Mr. Wilson was the Vice President and Treasurer of Guardian
Photo, Inc.
Ralph J. Gerson was first elected to the Board of Directors in November
1992, is the Chairman of the Board and is a Guardian designee. Mr. Gerson has
been Guardian's Executive Vice President and a member of the Guardian Board of
Directors since 1988.
Jeffrey A. Knight was first elected to the Board of Directors in November
1991 and is a Guardian designee. Since 1989, Mr. Knight has been Group Vice
President-Finance and Chief Financial Officer of Guardian.
C.K. Prahalad was first elected to the Board of Directors in February
1995. Dr. Prahalad is a Harvey C. Fruehauf Professor of Business
Administration at The University of Michigan.
Robert Teeter was first elected to the Board of Directors in February
1995. Mr. Teeter is President of Coldwater Corporation of Ann Arbor, Michigan.
Mark S. Wrighton was first elected to the Board of Directors in February
1995. Dr. Wrighton is the Chancellor of Washington University in St. Louis,
Missouri. From October 1990 to June 1995, Dr. Wrighton was Provost and
Ciba-Geigy Professor of Chemistry at The Massachusetts Institute of Technology
in Cambridge, Massachusetts.
Peter Joel C. Young was first elected to the Board of Directors in
November 1991 and is a Guardian designee. Mr. Young is Executive Vice
President of Harry London Candies, Inc. of North Canton, Ohio, and is also the
Special Assistant to the Chairman at Guardian and is providing consulting
services to Guardian and OIS. From March 1991 through August 1993, Mr. Young
was the director of International Business Development of Guardian. From July
1989 to March 1991 he was a legal advisor for the U.S. START Delegation, U.S.
Arms Control and Disarmament Agency.
- 9 -
<PAGE> 13
All directors serve until the Annual Meeting of Stockholders at which
elections are held and until their successors are duly elected and qualified.
All officers serve at the pleasure of the Board of Directors.
Compensation of Directors
In fiscal 1995, OIS established annual directors' compensation of
$15,000, plus $1,000 for each of four regular board meetings attended by the
director, plus $500 for each committee meeting attended by the director. All
Guardian designees have waived all director compensation. Peter Joel C. Young
provides consulting services to OIS in the areas of government relations and
long-range planning pursuant to a one-year, exclusive Consultant Agreement
effective September 1, 1995. Mr. Young receives $2,000 per month and expenses
for his consulting services.
Meetings and Committees
During the fiscal year ended June 30, 1995, four meetings were held by
the Board of Directors. All directors attended 75% or more of the meetings of
the Board of Directors and committees on which they served.
The Audit Committee of the Board of Directors met once during the fiscal
year ended June 30, 1995, and currently consists of Robert M. Teeter, Jeffrey
A. Knight and Charles C. Wilson (ex officio). The principal duties of the Audit
Committee are to (a) recommend selection of OIS's independent public
accountants, (b) review with the independent public accountants the results of
their audits, (c) review with the independent public accountants and management
OIS's financial reporting and operating controls and the scope of audits and
(d) make recommendations concerning OIS's financial reporting, accounting
practices and policies and financial, accounting and operating controls and
safeguards.
The Compensation Committee of the Board of Directors met once during the
fiscal year ended June 30, 1995, and currently consists of Mark S. Wrighton and
Ralph J. Gerson. The principal duties of the Compensation Committee are to
make recommendations concerning, and to review, the compensation packages of
OIS's executive officers and key personnel.
The Stock Option Plan Committee of the Board of Directors currently
consists of Ralph J. Gerson, Jeffrey A. Knight and Peter Joel C. Young, who
met once during the fiscal year ended June 30, 1995, and took action by
unanimous consent. The principal duties of the Stock Option Plan Committee are
to make, administer, and interpret all rules and regulations that it deems
necessary to administer OIS stock option plans and to make awards of stock
options and restricted stock under the plans. Members of the Stock Option Plan
Committee are not eligible for awards under the plans.
The Nominating Committee of the Board of Directors met once during the
fiscal year ending June 30, 1995, and currently consists of C.K. Prahalad,
Peter Joel C. Young and Rex Tapp (ex officio). The principal duties of the
Nominating Committee are to make recommendations of nominees for election to
the Board of Directors.
Executive Officers
The executive officers of OIS are as follows:
<TABLE>
<CAPTION>
NAME AGE OFFICE
---- --- ------
<S> <C> <C>
Rex Tapp 45 President and Chief Executive Officer
Charles C. Wilson 43 Executive Vice President & Chief Financial Officer
Vincent D. Cannella 57 Vice President
Fang-Chen Luo 51 Vice President of Research and Development
Curtis J. Casey 56 Vice President of Marketing and Business Development
Richard L. Diddams 59 General Manager, Manufacturing Operations
Scott V. Thomsen 31 Director of Product Development
</TABLE>
Information with respect to Mr. Tapp and Mr. Wilson is provided above.
Dr. Vincent D. Cannella was Vice President of Manufacturing Engineering
at OIS from June 1986 until August 1990, Vice President of New Business
Development from August 1990 until January 1994, Vice President of Technology
from January 1994 to September 1994, and has been Vice President since
September 1994.
- 10 -
<PAGE> 14
Fang-Chen Luo joined OIS in May 1991 as Executive Vice President and
Chief Operating Officer. In July 1994 he assumed the position of Executive
Vice President of Research and Engineering. In July 1995, he assumed the
position of Vice President of Research and Development. From January 1986
until joining OIS, Dr. Luo was employed at General Electric Company as Manager,
LCD Pilot Line, which produced active matrix LCDs for military avionic
applications.
Curtis J. Casey joined OIS in October 1993 as Vice President of Marketing
and Business Development. From before 1989 until joining OIS, Mr. Casey was
employed at Kaiser Electronics of San Jose, California, as Director, Business
Development.
Richard L. Diddams joined OIS in August 1994 as General Manager,
Manufacturing Operations. From 1987 until April 1990, Mr. Diddams was employed
at United Technologies in Colorado Springs as backend director; and from April
1990 until joining OIS, Mr. Diddams was employed at Zilog, Inc., where his last
position was as manager of Mod III.
Scott V. Thomsen joined OIS in September 1994 as Director of Technical
Development. In July 1995 he assumed the position of Director of Product
Development. From December 1989 until joining OIS, Mr. Thomsen was employed by
the Satellite Systems Operations Division of Honeywell, Inc. as a technical
director and computer systems design engineer on the space shuttle cockpit and
trainer programs.
Compliance with Section 16(a) of the Exchange Act. Based solely upon a
review of Forms 3 and 4 and amendments thereto filed with the Securities and
Exchange Commission and furnished to OIS in the fiscal year ended June 30,
1995, one of Fang-Chen Luo's transactions in fiscal 1994 was not reported and
single transactions by each of Rex Tapp, Charles C. Wilson, Fang-Chen Luo,
Vincent D. Cannella and Curtis J. Casey were reported late on timely filed Form
5's
PROPOSAL II
APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Upon the recommendation of the Audit Committee, the Board of Directors
has, subject to stockholder approval, appointed Arthur Andersen LLP to serve as
independent public accountants to OIS for the fiscal year ending June 30, 1996.
The services to be performed by Arthur Andersen LLP will include review of
reports and registration statements filed by OIS with the Securities and
Exchange Commission and consultation in connection with various accounting and
financial reporting matters. Arthur Andersen LLP was elected to and did serve
as independent public accountants to OIS for the fiscal year ended June 30,
1995.
The affirmative vote of a majority of the votes cast is required to
approve this proposal. A representative of Arthur Andersen LLP will be present
at the Meeting, will be available to respond to appropriate questions, and will
also have the opportunity to make a statement if he or she desires.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
FOR THE APPOINTMENT FOR FISCAL 1996 OF ARTHUR ANDERSEN LLP AS INDEPENDENT
PUBLIC ACCOUNTANTS.
ADDITIONAL INFORMATION
Other Action at the Meeting
OIS's management, on the date hereof, does not know of any other matter
to be presented that is a proper subject for action by the stockholders at the
Meeting. If any other matters shall properly come before the Meeting, the
shares represented by a properly executed proxy card will be voted in
accordance with the judgment of the persons designated on the proxy card.
Stockholder Proposals for 1996 Annual Meeting
Any stockholder proposal that is intended to be presented at the 1996
Annual Meeting of Stockholders must be received by OIS at its principal
executive offices at 47050 Five Mile Road, Northville, Michigan 48167, by June
13, 1996.
Material Incorporated by Reference
OIS specifically incorporates by reference into this Proxy Statement the
financial statements and management's discussion and analysis of financial
condition and results of operations contained in OIS's Annual Report for the
year ended June 30, 1995, which is enclosed.
By Order of the Board of Directors
David B. Jaffe
Corporate Secretary
Dated: October 2, 1995
- 11 -
<PAGE> 15
<TABLE>
<S><C>
/X/ PLEASE MARK VOTES
AS IN THIS EXAMPLE
With- For All
For Hold Except For Against Abstain
1. Election of Directors / / / / / / 2. Proposal to approve appointment of Arthur / / / / / /
Andersen LLP as independent public accoun-
tants for the fiscal year ending June 30, 1996.
Ralph J. Gerson Jeffrey A. Knight 3. In his discretion, the Proxy is authorized to vote upon such
C.K. Prahalad Rex Tapp other business as may properly come before the meeting.
Robert M. Teeter Charles C. Wilson
Mark S. Wrighton Peter Joel C. Young
If you do not wish your shares voted "FOR" a particular nominee,
mark the "For All Except" box and strike a line through the nominee(s)
name. Your shares will be voted for the remaining nominee(s).
RECORD DATE SHARES:
Date If shares are registered in the names of two or more
Please be sure to sign and date this Proxy persons, each should sign. Executors, administrators,
trustees, guardians, attorneys and corporate officers
should show their full titles.
Shareholder sign here Co-owner sign here
- ------------------------------------------------------------------------------------------------------------------------
OIS OPTICAL IMAGING SYSTEMS, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING ON NOVEMBER 9, 1995.
This undersigned hereby appoints Charles C. Wilson and Rex Tapp, or either of them with full power to act alone (with
full power of substitution, and in place of either in case of substitution, his substitute), the attorneys and proxies
for and on behalf of the undersigned to attend the Annual Meeting of Stockholders (the "Meeting") of OIS OPTICAL
IMAGING SYSTEMS, INC. (the "Company") to be held at Laurel Manor Banquet and Conference Center, 39000 Schoolcraft,
Livonia, Michigan 48150, in the Aspen meeting room, on Thursday, November 9, 1995, at 10:00 A.M., and any and all
adjournments thereof, and to cast the number of votes the undersigned would be entitled to vote if then personally
present. The undersigned instructs such proxies to vote as specified on this card.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES FOR DIRECTORS AND FOR PROPOSAL 2 AS DESCRIBED IN THE
ACCOMPANYING PROXY STATEMENT.
</TABLE>
