<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
X-RITE, INCORPORATED
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
X-RITE, INCORPORATED
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[ ] $125 per Exchange Act Rule 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:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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<PAGE> 2
X-RITE, INCORPORATED
3100 44TH STREET, S.W.
GRANDVILLE, MICHIGAN 49418
NOTICE OF ANNUAL MEETING TO BE HELD MAY 19, 1997
The Annual Meeting of Shareholders of X-Rite, Incorporated will be held at
the Grand Valley State University Eberhard Center, 301 West Fulton Street, Grand
Rapids, Michigan, on Monday, May 19, 1997, at 4:30 p.m., for the following
purposes:
1. To elect three directors as set forth in the accompanying Proxy
Statement.
2. To transact any other business that may properly come before the
meeting.
Shareholders of record as of the close of business on March 21, 1997, are
entitled to notice of, and to vote at the meeting. You are requested to sign,
date, and return the accompanying Proxy in the enclosed, self-addressed
envelope, regardless of whether you expect to attend the meeting in person. If
you attend the meeting in person, you may withdraw your Proxy and vote your
shares in person if you wish.
By Order of the Board of Directors
DUANE F. KLUTING
Secretary
<PAGE> 3
X-RITE, INCORPORATED
3100 44TH STREET, S.W.
GRANDVILLE, MICHIGAN 49418
------------------------
PROXY STATEMENT
APRIL 16, 1997
------------------------
SOLICITATION OF PROXIES
This Proxy Statement is being furnished to the shareholders of X-Rite,
Incorporated (the "Company") on or about April 16, 1997, in connection with the
solicitation by the Board of Directors of the Company of Proxies to be used at
the Annual Meeting of Shareholders to be held on Monday, May 19, 1997, at 4:30
p.m. at the Grand Valley State University Eberhard Center, 301 West Fulton
Street, Grand Rapids, Michigan.
If the form of Proxy accompanying this Proxy Statement is properly executed
and returned, the shares represented by the Proxy will be voted at the Annual
Meeting of Shareholders in accordance with the directions given in the Proxy.
Where shareholders specify a choice by marking on the Proxy card, the Proxy will
be voted as specified. If no choice is specified, the shares represented by the
Proxy will be voted for the election of the directors listed as nominees in the
Proxy, and in the discretion of the Proxy voters on any other matter voted upon
at the meeting. A Proxy may be revoked prior to its exercise by delivering a
written notice of revocation to the Secretary of the Company, executing a
subsequent Proxy or attending the meeting and voting in person.
The cost of the solicitation of Proxies will be borne by the Company. In
addition to the use of the mails, Proxies may be solicited personally or by
telephone or facsimile by a few regular employees of the Company without
additional compensation. The Company has retained D.F. King & Co., Inc., to aid
in the solicitation of proxies at an estimated cost of $4,500, plus expenses. In
addition, brokers, nominees, custodians, and other fiduciaries will be
reimbursed by the Company for their expenses in connection with sending proxy
materials to beneficial owners and obtaining their Proxies.
VOTING SECURITIES AND RECORD DATE
March 21, 1997, has been fixed by the Board of Directors as the record date
for determining shareholders entitled to vote at the Annual Meeting. On that
date, 21,092,339 shares of the Company's common stock, par value $.10 per share,
were issued and outstanding. Shareholders are entitled to one vote for each
share of the Company's common stock registered in their names at the close of
business on the record date.
ELECTION OF DIRECTORS
The Company's Articles of Incorporation specify that the Board of Directors
shall consist of nine (9) members, divided into three classes, with the
directors of the classes to hold office for staggered terms of three (3) years
each. Rufus S. Teesdale, Charles VanNamen, and Richard E. Cook, as described in
the following table, have been nominated for election to three year terms
expiring in 2000.
The term of office of incumbent director Lawrence E. Fleming expired as of
January 1, 1997 and Mr. Fleming will assume the position of Director Emeritus
(See discussion under the caption Executive Compensation following the Stock
Performance Graph).
Unless otherwise specifically directed by a marking on a shareholder's
Proxy, the persons named as proxy voters in the accompanying Proxy will vote for
the nominees described below. In the event any of these nominees is no longer a
candidate at the time of the Annual Meeting of Shareholders (a situation which
is not now anticipated), the Board of Directors may designate a substitute
nominee, in which case the accompanying Proxy will be voted for the substituted
nominee.
Directors are elected by a plurality of the votes cast by shareholders.
Therefore, the nominees for each class receiving the most affirmative votes cast
will be elected, irrespective of the number of votes received. Broker nonvotes,
votes withheld, and votes against any candidate will not have a bearing on the
outcome of the election. Votes will be counted by Inspectors of Election
appointed by the presiding officer at the meeting.
<PAGE> 4
The Board of Directors recommends a vote FOR the election of all the
persons nominated by the Board.
The content of the following table relating to business experience is based
upon information furnished to the Company by the nominees and directors.
<TABLE>
<CAPTION>
NAMES, (AGES), POSITIONS AND BACKGROUNDS
OF DIRECTORS AND NOMINEES SERVICE AS A DIRECTOR
- -----------------------------------------------------------------------------------------------------
<S> <C>
Nominees For Terms to Expire in 2000
Rufus S. Teesdale (76) has been retired for more than five Director since 1958
years. Prior to retirement he was a Partner in Loan Services Chairman of Audit Committee
and Systems in Glen Ellyn, Illinois (a software supplier to
financial institutions).
Charles VanNamen (71) has been retired for more than five Director since 1958
years. Prior to retirement he was a Senior Engineer with the Member of Audit and
Instrument Division of Lear Siegler, Inc., in Grand Rapids, Compensation Committees
Michigan (a manufacturer of aerospace instruments).
Richard E. Cook (51) is the President of Cascade Engineering
headquartered in Grand Rapids, Michigan, and he has held
that position for the last five years.
Directors Whose Terms Expire in 1999
Stanley W. Cheff (55) is the President and Chief Executive Director since 1996
Officer of Wolverine Building, Inc., a construction firm Chairman of Nominating
headquartered in Grand Rapids, Michigan, and he has held Committee and Member of
that position for more than five years. Compensation Committee
Dr. Marvin G. DeVries (63) is an economics consultant, and Director since 1986
he served as a Professor of Economics at the F.E. Seidman Member of Audit Committee
School of Business, Grand Valley State University,
Allendale, Michigan, for more than five years prior to his
retirement in 1994. In addition, Dr. DeVries served as Dean
of the Business School from 1973 to 1988.
James A. Knister (59) is Group Managing Director -- Ventures Director since 1996
of Donnelly Corporation, a manufacturer of glass related Member of Audit Committee
products for the automotive and electronics industries,
headquartered in Holland, Michigan, and he has held that
position since 1996. Previously, Mr. Knister has held
several executive management positions with Donnelly for
many years.
Directors Whose Terms Expire in 1998
Ted Thompson (67) is the Chairman of the Board and Chief Director since 1958
Executive Officer of X-Rite, Incorporated, and he has held Chairman of the Board
that position for more than five years. Mr. Thompson also and Chief Executive Officer Member
serves as a director of Gentex Corporation. of Nominating Committee
Ronald A. VandenBerg (57) is a Business Unit Vice President Director since 1989
of Donnelly Corporation, a manufacturer of glass related Chairman of Compensation
products for the automotive and electronics industries, Committee and Member of Nominating
headquartered in Holland, Michigan. Mr. VandenBerg has held Committee
several executive positions with Donnelly for many years.
Quinten E. Ward (71) has been retired for more than five Director since 1958
years. Prior to retirement he was a Senior Engineer with the Member of Compensation
Instrument Division of Lear Siegler, Inc., Grand Rapids, Committee
Michigan (a manufacturer of aerospace instruments).
- -----------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE> 5
The Company has an Audit Committee which recommends to the Board of
Directors the selection of independent public accountants to serve as the
Company's auditors, and reviews the scope of their audit and their audit report.
This Committee met on two occasions during the fiscal year ended December 31,
1996.
The Company has a Compensation Committee which makes recommendations to the
Board regarding annual remuneration of the Company's executive officers, and
which is responsible for administering the Company's various incentive plans
involving the Company's common stock. This Committee met on five occasions
during the fiscal year ended December 31, 1996. A report from this Committee
appears infra under the caption Report on Executive Compensation.
The Company has a Nominating Committee that is responsible for recommending
to the Board of Directors annually a slate of nominees for election as directors
to be submitted to the shareholders of the Company at the Annual Meeting. The
Committee is also responsible for recommending nominees to fill vacancies that
may occur at other times. The Committee will consider persons suggested as
nominees by shareholders, and suggestions should be sent to the Nominating
Committee c/o the Company's Secretary at its headquarters. This Committee met on
three occasions during the fiscal year ended December 31, 1996.
The Board of Directors met eight times during the past fiscal year, and all
directors attended at least seventy-five percent (75%) of the aggregate number
of meetings of the Board and meetings of committees on which they served.
SECURITIES OWNERSHIP OF MANAGEMENT
The following table contains information regarding ownership of the
Company's common stock by each director and nominee for election as a director,
each executive officer named in the tables under the caption Executive
Compensation, and all directors and executive officers as a group. The content
of this table is based upon information supplied by the persons identified in
the table and represents the Company's understanding of circumstances in
existence as of March 3, 1997.
3
<PAGE> 6
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF OWNERSHIP
---------------------------------------------------
NAME AND ADDRESS OF SHARES BENEFICIALLY EXERCISABLE
BENEFICIAL OWNER OWNED(1) OPTIONS(2) TOTAL PERCENT OF CLASS
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Rufus S. Teesdale 1,529,195 20,000 1,549,195 7.2
3152 E. Gatehouse, S.E.
Grand Rapids, MI 49546
Ted Thompson 1,528,300(3) 100,000 1,628,300 7.5
3100 44th Street
Grandville, MI 49418
Quinten E. Ward 1,249,100(4) 30,000 1,279,100 6.0
2251 N. Rampart Blvd., Suite 102
Las Vegas, NV 89128
Joan Mariani Andrew -0- 15,000 15,000 *
Bernard J. Berg 11,100 58,000 69,100 *
Stanley W. Cheff 3,000 10,000 13,000 *
Robert D. Claflin 656 4,000 4,656 *
Richard E. Cook (director nominee) -0- -0- -0- *
Dr. Marvin DeVries 4,096 52,000 56,096 *
Duane F. Kluting 18,212(5) 52,000 70,212 *
James A. Knister 2,000 10,000 12,000 *
Ronald A. VandenBerg 8,000 52,000 60,000 *
Charles VanNamen 706,000(6) 30,000 736,000 3.4
All Directors and Executive 5,062,957 455,000 5,527,957 25.6
Officers as a Group (16 persons)
</TABLE>
- --------------------------------------------------------------------------------
* Less than one percent
(1) Except as disclosed in the footnotes below, each person named in the table
has sole voting and investment power with respect to the issued shares
listed in this column.
(2) This column reflects shares subject to options exercisable within 60 days.
(3) Includes 160,000 shares issued to a trust established by Mr. Thompson's
wife, and he disclaims beneficial ownership of the shares held by his wife's
trust.
(4) Includes 180,000 shares issued to a trust established by Mr. Ward's wife,
and he disclaims beneficial ownership of those shares.
(5) Includes 13,434 shares issued to a trust established by Mr. Kluting's wife,
and he disclaims beneficial ownership of those shares.
(6) Includes 265,900 shares issued to a trust established by Mr. VanNamen's
wife, and he disclaims beneficial ownership of those shares.
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table contains information regarding ownership of the
Company's common stock by persons or entities beneficially owning more than five
percent (5%) of the Company's common stock as of March 3, 1997. The content of
this table is based upon information contained in Schedule 13G furnished to the
Company. Both of the individuals listed in this table are founders and former
directors of the Company.
4
<PAGE> 7
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP CLASS
- --------------------------------------------------------------------------------------------------------
<S> <C> <C>
Leonard C. Blanding 1,437,132(1) 6.6
6600 Tanglewood, S.E.
Grand Rapids, MI 49546
Lawrence E. Fleming 1,620,000 7.5
6200 Hall St., S.E.
Grand Rapids, MI 49546
</TABLE>
- --------------------------------------------------------------------------------
(1) Includes 314,050 shares issued to a trust established by Mr. Blanding's
wife, and he disclaims beneficial ownership of those shares.
EXECUTIVE COMPENSATION
The following table contains information regarding compensation paid by the
Company with respect to the preceding fiscal year to its chief executive officer
and to the four other most highly compensated executive officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL --------------------------
COMPENSATION RESTRICTED SECURITIES
-------------------- STOCK UNDERLYING ALL OTHER
SALARY BONUS AWARD(S) OPTIONS COMPENSATION
EXECUTIVE YEAR ($) ($)(1) ($)(1)(2) (#) ($)(3)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Ted Thompson 1996 270,000 49,213 20,000 14,219
Chairman and 1995 270,000 20,200 -- 20,000 13,650
Chief Executive Officer 1994 246,634 164,700 -- 20,000 13,650
Bernard J. Berg 1996 145,000 23,995 10,000 3,909
Vice President -- 1995 145,000 10,900 -- 10,000 3,691
Engineering 1994 130,385 74,500 -- 10,000 3,071
Duane F. Kluting 1996 140,000 23,340 10,000 3,743
Vice President -- 1995 140,000 10,600 -- 10,000 3,593
Chief Financial Officer 1994 120,961 36,450 33,250 6,000 2,614
Joan Mariani Andrew 1996 120,593 25,000 10,000 440
Vice President --
Sales and Marketing
Robert D. Claflin 1996 148,877 34,024 -- 2,000 5,297
President, Labsphere, Inc. 1995 124,580 39,402 -- 2,000 5,167
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Bonuses paid to the Company's executive officers may be converted by them
into common stock of the Company, pursuant to the Company's Cash Bonus
Conversion Plan. Bonuses are converted at a discount of 50 percent from the
market value of the stock at the time the bonus is determined, but the
shares received are subject to certain restrictions on transfer and risks of
forfeiture. The conversion option was not available to executives for 1995
and the results of conversion for 1996 will not be finalized until September
15, 1997. Restricted Stock Awards shown above are the result of such bonus
conversions.
(2) The values shown in this column represent the aggregate market value at the
date of grant for shares of common stock subject to restrictions, less the
amount of bonus converted. Restrictions lapse as to 20 percent of the shares
six months after grant and as to 20 percent on each of the first four
anniversaries of the grant date, or as to all shares in the event of death,
disability, retirement, or change in control of the Company. Dividends will
be paid on these shares to the same extent paid on the Company's common
5
<PAGE> 8
stock generally. At the close of the Company's fiscal year, Mr. Kluting held
2,100 restricted shares with a net market value of $34,650.
(3) These amounts represent "matching" contributions by the Company pursuant to
its 401(k) Plan and annual premiums for term life insurance attributable to
each named executive officer.
-----------------------------
The following table contains information regarding stock options granted to
the above-named executive officers during the preceding fiscal year.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
--------------------------------------------------------------
OPTIONS PERCENT OF OPTIONS EXERCISE GRANT DATE
GRANTED GRANTED TO ALL PRICE EXPIRATION PRESENT VALUE
EXECUTIVE (1) EMPLOYEES ($/SH)(2) DATE ($)(3)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Ted Thompson 20,000 17.1 14.50 3/19/06 117,000
Bernard J. Berg 10,000 8.5 14.50 3/19/06 58,500
Duane F. Kluting 10,000 8.5 14.50 3/19/06 58,500
Joan Mariani Andrew 10,000 8.5 14.50 3/19/06 58,500
Robert D. Claflin 2,000 1.7 14.50 3/19/06 11,700
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Options become exercisable one year after the date of grant.
(2) The price may be paid in cash or by the surrender of outstanding shares.
(3) Present value calculated under the Black-Scholes Valuation Model, assuming
6.2 percent risk-free rate of return, .5 percent dividend yield, .36
volatility, and exercise in 5 years. This model is an alternative suggested
by the Securities and Exchange Commission, and the Company neither endorses
this particular model nor necessarily agrees with the method for valuing
options. The future performance of the Company and the price of its shares
will ultimately determine the value of these options.
------------------------
The following table contains information regarding the exercise of options
during the preceding fiscal year by the above-named executives, as well as
unexercised options held by them at fiscal year-end.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR-END VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT
SHARES VALUE YEAR-END(#) FISCAL YEAR-END($)
ACQUIRED ON REALIZED ------------------------------ ------------------------------
EXERCISE(#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Ted Thompson -- -- 80,000 20,000 345,000 40,000
Bernard J. Berg 10,000 154,063 48,000 10,000 309,188 20,000
Duane F. Kluting -- -- 42,000 10,000 250,125 20,000
Joan Mariani Andrew -- -- 5,000 10,000 8,750 20,000
Robert D. Claflin -- -- 2,000 2,000 -- 4,000
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee is currently comprised of four members, and all
members are outside directors; i.e., none is an employee of the Company. The
Committee makes recommendations to the Board of Directors with respect to all
executive compensation except for the award of stock-based incentives, which are
the exclusive prerogative of the Committee.
6
<PAGE> 9
The Compensation policies established for executive officers are designed
to assure the Company's ability to attract, motivate, and retain competent and
dedicated senior management. In constructing and applying these policies, a
conscious effort is made to identify and evaluate the executive compensation
programs for comparable employers, considering such factors as geographic and
industry influences, relative sizes, growth stages, and market capitalizations.
With the assistance of a consulting firm, the Committee has established a peer
group of corporations that it uses for compensation comparison purposes.
In general, compensation packages for executive officers are composed of
three elements: base salary, annual bonus, and stock-based incentives. Base
salary for an executive is determined by the executive's responsibility and the
Company's need to be competitive in the market for executive services. Bonus
compensation is based on achievement of corporate goals. Stock-based incentives
are intended to strengthen the alignment of interests between shareholders and
senior management and to address long-term performance.
In the early part of 1996, the Compensation Committee reviewed the annual
salary plan with the Chief Executive Officer for all other executive officers,
and made such adjustments as they thought appropriate, based upon salary survey
data for comparable employers, economic conditions in general, and individual
evaluations by the Chief Executive Officer. Annual salary for the Chief
Executive Officer was reviewed independently by the Committee and adjusted based
upon the same considerations for other executive salaries, plus the Committee's
evaluation of his performance as corporate leader.
At the same time, the Committee established the annual bonus program based
on operating profit in relation to the annual budget approved by the Board of
Directors (except with respect to Labsphere where bonuses are discretionary with
the Committee). A maximum award was set at fifty percent (50%) of base salary in
the case of the Chief Executive Officer, and forty percent (40%) of base salary
in the case of all other executives. Actual bonuses under this program were
determined by the Committee after the close of the fiscal year. All cash bonus
programs have been replaced for 1997 by a program based on economic value added
in excess of an annual goal approved by the Board of Directors.
The Committee also awarded stock options to eight executives during 1996
under the Employee Stock Option Plan, including the grants to the named
executives detailed in the foregoing table captioned Option Grants in Last
Fiscal Year. The options awarded to the executives, other than the Chief
Executive Officer, were awarded based upon recommendations from the Chief
Executive Officer, taking into account for each executive his contribution to
success in prior periods by achieving agreed upon goals, and his ability and
willingness to influence success in the future by striving to achieve individual
and corporate goals. The Chief Executive Officer was awarded an option based
primarily on the Committee's judgment that it is in the best interest of
shareholders to provide incentive for the Chief Executive Officer in the form of
stock options, in an amount that is appropriate relative to the options granted
other executives, considering their abilities to influence corporate
performance.
COMPENSATION COMMITTEE
Stanley W. Cheff
Charles VanNamen
Ronald A. VandenBerg
Quinten E. Ward
7
<PAGE> 10
STOCK PERFORMANCE GRAPH
The following graph depicts the cumulative total return on the Company's
common stock compared to the cumulative total return on the indices for NASDAQ
market (U.S. and foreign) and NASDAQ nonfinancial stocks. The graph assumes an
investment of $100 on the last trading day of 1991, and reinvestment of
dividends in all cases.
<TABLE>
<CAPTION>
MEASUREMENT PERIOD X-RITE, NASDAQ NASDAQ
(FISCAL YEAR COVERED) INCORPORATED STOCK NON-
MARKET (US FINANCIAL
& FOREIGN) STOCKS
<S> <C> <C> <C>
1991 100 100 100
101.093 103.340 101.581
135.625 96.331 91.232
185.671 99.976 94.133
1992 203.219 116.035 109.394
164.194 118.674 109.595
163.552 121.551 113.683
177.389 131.692 122.564
1993 169.995 134.321 126.300
162.548 128.695 120.237
184.172 122.156 110.876
267.962 132.468 121.872
1994 307.160 130.278 121.444
303.642 141.711 131.750
288.440 161.987 152.341
292.733 181.283 169.855
1995 220.887 182.958 169.244
234.931 191.849 177.759
239.241 206.734 193.424
286.753 213.759 198.264
1996 259.618 224.063 205.629
</TABLE>
The Company has not adopted any long-term incentive plan or any defined
benefit or actuarial plan, as those terms are defined in the applicable
regulations promulgated by the Securities and Exchange Commission. Neither does
the Company have any contracts with its executive officers assuring them of
continued employment, nor any compensatory arrangement for executives linked to
a change in control of the Company.
During 1996 members of the Company's Board of Directors each received an
annual retainer of $12,000, plus a meeting fee of $750 ($1,500 for chairpersons)
for each meeting of the Board or a committee attended. In addition, each person
who is a director immediately following each Annual Meeting of Shareholders is
entitled to receive an option to purchase 10,000 shares of the Company's common
stock at a price per share equal to the fair market value on that date. Each
option has a term of ten years and becomes exercisable in full six months after
the date of the grant.
Directors who have served three or more terms (nine years) automatically
become Directors Emeritus at such time as they no longer hold the position of a
director of the Company. Directors Emeritus are entitled to attend meetings of
the Board, but they may not vote, and they are entitled to receive the
directors' annual retainer, but no meeting fees. Director Emeritus status lasts
for a period equal to the length of service as a director or until any earlier
resignation or death.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The consolidated financial statements of the Company and its subsidiaries
for the year ended December 31, 1996, have been audited by Arthur Andersen LLP,
independent public accountants, and the Board of Directors has selected Arthur
Andersen LLP to serve as the Company's independent accountants for the year
ending December 31, 1997. Representatives of Arthur Andersen LLP are expected to
be present at the Annual Meeting to respond to appropriate questions and will
have an opportunity to make a statement if they desire.
8
<PAGE> 11
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based upon a review of Forms 3, 4, and 5 furnished to the Company during or
with respect to the preceding fiscal year and written representations from
certain reporting persons, the Company is not aware of any failure by any
reporting person to make timely filings of those Forms as required by Section
16(a) of the Securities Exchange Act of 1934, except as follows: Messrs
Blanding, DeVries, and Ward were all late on one occasion filing a Form 4 to
report one disposition of common stock. However, Mr. Blanding is a Director
Emeritus and he does not concede any obligation to file Form 4s.
SHAREHOLDER PROPOSALS -- 1998 ANNUAL MEETING
Any proposal of a shareholder intended to be presented at the 1998 Annual
Meeting of the Shareholders of the Company must be received by the Company at
its headquarters, 3100 44th Street, S.W., Grandville, Michigan 49418, no later
than December 17, 1997, if the shareholder wishes the proposal to be included in
the Company's Proxy Statement relating to that meeting.
MISCELLANEOUS
The Company's Annual Report to Shareholders including financial statements,
is being mailed to shareholders with this Proxy Statement.
Management is not aware of any matters to be presented for action at the
Annual Meeting other than as set forth in this Proxy Statement. If other
business should come before the meeting, the persons named as proxy holders in
the accompanying Proxy intend to vote the shares in accordance with their
judgment, and discretionary authority to do so is included in the Proxy.
A COPY OF THE COMPANY'S REPORT ON FORM 10-K FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION IS AVAILABLE, WITHOUT CHARGE, UPON WRITTEN REQUEST FROM
DUANE F. KLUTING, THE COMPANY'S VICE PRESIDENT/CHIEF FINANCIAL OFFICER, 3100
44TH STREET, S.W., GRANDVILLE, MICHIGAN 49418.
SHAREHOLDERS ARE URGED TO PROMPTLY DATE, SIGN, AND RETURN THE ACCOMPANYING
PROXY IN THE ENCLOSED ENVELOPE.
By Order of the Board of Directors
DUANE KLUTING
Secretary
April 16, 1997
Grandville, Michigan
9
<PAGE> 12
MAILING LIST REQUEST
- --------------------------------------------------------------------------------
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Return this coupon to the address below. Thank you.
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Name:
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Company (if applicable):
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Address:
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City, State, Zip Code:
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Investor Relations
X-Rite, Incorporated
3100 44th Street, S.W.
Grandville, Michigan 49418
<PAGE> 13
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE
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X-RITE, INCORPORATED
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RECORD DATE SHARES:
Please be sure to sign and date this Proxy. Date
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Shareholder sign here Co-owner sign here
1. Election of Directors.
WITH- FOR ALL
FOR HOLD EXCEPT
RICHARD E. COOK
RUFUS S. TEESDALE / / / / / /
CHARLES VAN NAMEN
NOTE: 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(s')
name(s). Your shares will be voted for the remaining nominee(s).
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Meeting.
Mark box at right if you plan to attend the Meeting. / /
Mark box at right if an address change or comment has been noted
on the reverse side of this card. / /
DETACH CARD DETACH CARD
X-RITE, INCORPORATED
Dear Shareholder,
Please take note of the important information enclosed with this Proxy Ballot.
There are issues related to the management and operation of your Corporation
that require your immediate attention and approval. Please refer to the
enclosed proxy materials for further detail.
Your vote counts, and you are strongly encouraged to exercise your right to
vote your shares.
Please mark the boxes on this proxy card to indicate how your shares will be
voted. Then sign the card, detach it and return your proxy vote in the
enclosed postage paid envelope.
Your vote must be received prior to the Annual Meeting of Shareholders
scheduled for May 19, 1997.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
X-RITE, INCORPORATED
<PAGE> 14
X-RITE, INCORPORATED
3100 44TH STREET, S.W.
GRANDVILLE, MICHIGAN 49418
PROXY
THIS PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoint(s) J. Terry Moran and Duane Kluting, and each
of them, as Proxies, each with the power to appoint a substitute, to represent
and to vote, as designated on the reverse, all shares of common stock of
X-Rite, Incorporated held of record by the undersigned on March 21, 1997, at the
Annual Meeting of Shareholder to be held on May 19, 1997, or any adjournment
thereof.
When properly executed, this proxy will be voted in the manner directed by the
undersigned shareholder(s). IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE ELECTION OF THE NOMINEES LISTED ON THE REVERSE SIDE FOR AN THREE-YEAR
TERM.
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
Please sign exactly as your name(s) appear(s) on the reverse side. Joint
owners should each sign personally. Trustees and other fiduciaries should
indicate the capacity in which they sign, and where more than one name
appears, a majority must sign. If a corporation, this signature should be that
of an authorized officer who should state his or her title.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
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