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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 1, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from_________________ to ________________
Commission File Number 0-20215
MICROTOUCH SYSTEMS, INC.
(Exact name of Registrant as specified in its Charter)
Massachusetts 04-2802971
------------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
300 Griffin Brook Park Drive, Methuen, MA 01844
----------------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number: 978-659-9000
------------------------------ ------------
Indicate by check mark whether the Registrant (1) has filed all reports to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the Registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the last 90 days.
Yes X No
--- ---
Indicate the number of shares outstanding of each of the Registrant's classes of
common stock as of the latest practical date.
As of August 8, 2000 there were outstanding: 6,471,092 shares of common stock of
the Registrant.
Total number of pages: 12
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MICROTOUCH SYSTEMS, INC. AND SUBSIDIARIES
INDEX
PAGE NO.
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets - July 1, 2000
and December 31, 1999 3
Consolidated Statements of Operations and Comprehensive
Income - Three and Six Months Ended July 1, 2000 and
July 3, 1999 4
Consolidated Statements of Cash Flows - Six
Months Ended July 1, 2000 and July 3, 1999 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURES 12
2
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MICROTOUCH SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
JULY 1, DECEMBER 31,
2000 1999
---------- ------------
ASSETS (Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents .............................................. $ 5,868 $ 4,329
Marketable securities .................................................. 12,354 15,566
Accounts receivable, net of allowances of $1,589 and $1,701
at July 1, 2000 and December 31, 1999, respectively ................. 22,806 30,387
Inventories ............................................................ 22,239 18,014
Deferred income taxes .................................................. 5,514 4,854
Prepaid expenses and other current assets .............................. 1,266 1,177
-------- --------
Total current assets .............................................. 70,047 74,327
Property and equipment, net ................................................. 21,201 20,975
Other assets ................................................................ 1,297 1,802
-------- --------
Total assets ................................................................ $ 92,545 $ 97,104
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable .......................................................... $ 4,950 $ 4,635
Accounts payable ....................................................... 9,210 10,190
Accrued payroll and related costs ...................................... 2,721 2,763
Accrued expenses ....................................................... 9,700 9,938
-------- --------
Total current liabilities ......................................... 26,581 27,526
Long-term notes payable ..................................................... 68 70
-------- --------
Total liabilities ................................................. 26,649 27,596
Stockholders' equity
Preferred stock, $.01 par value per share - 500,000 shares
authorized, none issued and outstanding at July 1, 2000
and December 31, 1999, respectively ................................. -- --
Common stock, $.01 par value per share - 20,000,000 shares
authorized, 8,392,011 and 8,379,861 shares issued at July 1,
2000 and December 31, 1999, respectively ............................ 84 84
Additional paid-in capital ............................................. 64,209 64,107
Treasury stock at cost, 1,937,776 and 1,853,276 shares at
July 1, 2000 and December 31, 1999, respectively .................... (27,374) (26,292)
Accumulated other comprehensive loss ................................... (2,567) (1,621)
Retained earnings ...................................................... 31,544 33,230
-------- --------
Total stockholders' equity ........................................ 65,896 69,508
-------- --------
Total liabilities and stockholders' equity................................... $ 92,545 $ 97,104
======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
STATEMENTS.
3
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MICROTOUCH SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(In thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
----------------------------- -------------------------------
July 1, 2000 July 3, 1999 July 1, 2000 July 3, 1999
------------ ------------ ------------ ------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net sales .................................... $ 36,671 $ 41,044 $ 76,676 $ 77,772
Cost of sales ................................ 26,762 26,212 56,705 49,302
-------- -------- -------- --------
Gross profit ............................ 9,909 14,832 19,971 28,470
Operating expenses:
Research and development ................ 3,172 3,120 6,891 6,378
Sales and marketing ..................... 4,602 5,700 10,034 11,063
General and administrative .............. 2,792 2,891 5,798 5,399
Amortization of intangibles ............. 55 100 110 214
-------- -------- -------- --------
Total operating expenses ........... 10,621 11,811 22,833 23,054
-------- -------- -------- --------
Operating income (loss) ....... (712) 3,021 (2,862) 5,416
Other income, net ............................ 275 63 419 564
Litigation costs ............................. -- -- -- 3,303
-------- -------- -------- --------
Income (loss) before income taxes ............ (437) 3,084 (2,443) 2,677
Income tax expense (benefit) ................. (136) 987 (757) 857
-------- -------- -------- --------
Net income (loss) ............................ $ (301) $ 2,097 $ (1,686) $ 1,820
======== ======== ======== ========
Net income (loss) per share:
Basic ................................... $ (0.05) $ 0.30 $ (0.26) $ 0.26
Diluted ................................. $ (0.05) $ 0.30 $ (0.26) $ 0.25
Weighted average and dilutive potential
common shares outstanding:
Basic ................................... 6,450 6,952 6,479 7,122
Diluted ................................. 6,450 7,079 6,479 7,252
Comprehensive income:
Net income (loss) ............................ $ (301) $ 2,097 $ (1,686) $ 1,820
Currency translation adjustment .............. (405) (126) (897) (768)
Unrealized gain (loss) on marketable
securities .............................. (7) (99) (49) (71)
-------- -------- -------- --------
Comprehensive income ......................... $ (713) $ 1,872 $ (2,632) $ 981
======== ======== ======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED
FINANCIAL STATEMENTS.
4
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MICROTOUCH SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
<TABLE>
<CAPTION>
Six Months Ended
-------------------------
July 1, July 3,
2000 1999
----------- -------
(Unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) ............................................... $ (1,686) $ 1,820
Adjustments to reconcile net income (loss) to net cash provided
by operating activities ---
Depreciation and amortization ................................ 2,673 2,425
Compensation expense related to stock options ................ 15 15
Changes in operating assets and liabilities ---
Accounts receivable ....................................... 7,581 (777)
Inventories ............................................... (4,225) 1,708
Prepaid expenses and other assets ......................... 306 (336)
Deferred income taxes ..................................... (660) 341
Accounts payable .......................................... (980) (1,306)
Accrued expenses .......................................... (282) 1,348
-------- --------
Net cash provided by operating activities .............. 2,742 5,238
Cash flows from investing activities:
Purchase of property and equipment, net ......................... (2,789) (4,539)
Sale and maturity of marketable securities ...................... 4,107 12,386
Purchase of marketable securities ............................... (895) (1,387)
-------- --------
Net cash provided by investing activities .............. 423 6,460
Cash flows from financing activities:
Exercise of stock options and sale of common stock, net ......... 87 427
Increase (decrease) in notes payable and long-term debt ......... 315 (3,782)
Purchase of treasury stock ...................................... (1,082) (6,724)
-------- --------
Net cash used in financing activities .................. (680) (10,079)
Effect of exchange rates on cash ....................................... (946) (768)
-------- --------
Net increase in cash and cash equivalents .............................. 1,539 851
Cash and cash equivalents, beginning of period ......................... 4,329 5,471
-------- --------
Cash and cash equivalents, end of period ............................... $ 5,868 $ 6,322
======== ========
Supplemental disclosures of cash flow information:
Interest paid ................................................... $ 234 $ 51
======== ========
Income taxes paid (refunded) .................................... $ (214) $ 1,053
======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED
FINANCIAL STATEMENTS.
5
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MICROTOUCH SYSTEMS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JULY 1, 2000
(1) Nature of Business
------------------
MicroTouch Systems, Inc. develops, manufactures and sells touch and
pen input systems, including touch sensitive screens, digitizers for pen
computers, and ThruGlass products.
(2) Consolidated Financial Statements
---------------------------------
The accompanying consolidated financial statements include the
accounts of MicroTouch Systems, Inc. and its wholly-owned subsidiaries (the
Company). All significant intercompany accounts, transactions and profits have
been eliminated.
(3) Interim Consolidated Financial Statements
-----------------------------------------
The accompanying consolidated financial statements as of July 1, 2000
and for the three and six month periods ended July 1, 2000 and July 3, 1999
include the accounts of the Company, and are unaudited; however, these
statements, prepared in accordance with generally accepted accounting
principles, reflect, in the opinion of management, all adjustments (consisting
only of normal recurring accruals) necessary to present fairly the financial
position as of July 1, 2000, and the results of operations and cash flows for
the three and six month periods ended July 1, 2000 and July 3, 1999. The
results of operations for the three and six month periods ended July 1, 2000 are
not necessarily indicative of the results to be expected for any other interim
period or the entire year.
These consolidated financial statements do not include all disclosures
associated with annual consolidated financial statements and, accordingly,
should be read in conjunction with the footnotes contained in the Company's
Annual Report on Form 10-K for the year ended December 31, 1999.
(4) Earnings per Share
------------------
Basic earnings per share is computed using the weighted average number
of common shares outstanding during the period. Diluted earnings per share is
computed using the weighted average number of common shares outstanding during
the period and dilutive potential common shares. Dilutive potential common
shares consist of stock options and are calculated using the treasury stock
method. The effect of stock options is antidilutive in loss periods. Therefore,
excluded from diluted earnings per share were 99,000 dilutive potential common
shares for the three month period ended July 1, 2000, as such shares would be
antidilutive. Also excluded from diluted earnings per share were options to
purchase 1,556,000 and 1,263,000 shares in the three month periods ended July 1,
2000 and July 3, 1999, respectively. These options were excluded as the exercise
price was greater than the average market price of the common shares during the
respective periods.
(5) Line of Credit
--------------
The Company has demand bank lines of credit in the U.S. totaling
$7,500,000, including letters of credit, under which the Company may borrow on
an unsecured basis at the bank's prime rate. There was a balance of $4,000,000
and $3,105,000 outstanding under these lines at July 1, 2000 and December 31,
1999, respectively. The Company also has a demand bank line of credit in the
United Kingdom in the amount of approximately $2,400,000 under which the Company
may borrow on a secured basis at a negotiated rate. There was a balance of
$950,000 and $1,500,000 outstanding under this line at July 1, 2000 and December
31, 1999, respectively.
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(6) Non-recurring Charge
--------------------
During the fourth quarter of 1999, the Company recorded a pre-tax
non-recurring charge of $1,950,000 related to the divestiture of its Factura
kiosk product line. On January 18, 2000, the Company completed the sale of
certain of the assets of the Factura product line. The non-recurring charge
included (i) $43,000 associated with personnel reductions of approximately 12
positions at the Factura facility prior to the sale; (ii) $417,000 associated
with estimated lease costs for the Factura facility subsequent to the sale date
(net of estimated sublease income); (iii) $210,000 associated with legal and
other exit costs; and (iv) $1,280,000 associated with a loss on the sale of the
non-cash assets of Factura. During the three and six month periods ended July 1,
2000, the Company paid out approximately $88,000 and $262,000, respectively,
related to personnel reductions, facility costs and legal and other exit costs.
(7) Sale of IBID
------------
On May 27, 2000, the Company completed the sale of the net assets of
the IBID whiteboard product line to a third party. The Company received proceeds
of $3.0 million in cash and may also receive additional payments based upon the
buyer achieving certain specified revenue levels over the next five years. As a
result of this transaction, the Company recorded a gain of $314,000 in the three
months ended July 1, 2000.
7
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MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS:
The following table sets forth, for the periods indicated, the percentage of net
sales represented by certain items in MicroTouch's statements of operations:
<TABLE>
<CAPTION>
Percentage of Net Sales
-----------------------
Three Months Ended Six Months Ended
----------------------------- ----------------------------
July 1, 2000 July 3, 1999 July 1, 2000 July 3, 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net Sales ................................ 100.0% 100.0% 100.0% 100.0%
Cost of Sales ............................ 73.0 63.9 74.0 63.4
Gross Profit ........................ 27.0 36.1 26.0 36.6
Operating Expenses:
Research and Development ............ 8.6 7.6 9.0 8.2
Sales and Marketing ................. 12.6 13.9 13.1 14.3
General and Administrative .......... 7.6 7.3 7.6 6.9
Amortization of Intangible Assets ... 0.2 0.1 0.1 0.3
Total Operating Expenses ....... 29.0 28.9 29.8 29.6
Operating Income (Loss) .................. (2.0) 7.2 (3.7) 7.0
Other Income, net ........................ 0.8 0.2 0.5 0.7
Litigation Costs ......................... -- -- -- 4.2
Income (Loss) Before Income Taxes ........ (1.2) 7.5 (3.2) 3.4
Net Income (Loss) ........................ (0.8) 5.1 (2.2) 2.3
</TABLE>
NET SALES. Net sales in the quarter ended July 1, 2000 decreased from the
corresponding period of 1999 by $4.4 million or 11%. For the six-month period
ended July 1, 2000, net sales decreased from the corresponding period of 1999 by
$1.1 million. The decrease in net sales was primarily due to the sale of the
Factura and IBID product lines in 2000, as well as offsetting volume decreases
in North America and volume increases in Asia Pacific. Excluding Factura and
IBID revenue from both six-month periods, net sales would have increased by $1.2
million or 2%. International sales accounted for 56% of net sales for the six-
month period, representing an increase from 43% in the corresponding period of
1999, due to the growth in Asia Pacific combined with decreased sales in North
America.
GROSS PROFIT. Gross profit in the quarter ended July 1, 2000 decreased from the
corresponding period of 1999 by $4.9 million or 33%. As a percentage of net
sales, gross profit decreased from 36.1% in the second quarter of 1999 to 27% in
the second quarter of 2000. For the six-month period ended July 1, 2000, gross
profit decreased from the corresponding period of 1999 by $8.5 million or 30%,
and decreased as a percentage of net sales from 36.6% in 1999 to 26% in 2000.
The gross profit percentage decline was primarily due to: a.) the continued
investment in expanding the Methuen-based production capacity of resistive
touchscreens; b.) reduced margins in the Company's monitor operations relating
to a combination of lower CRT volumes, decreased integration services and higher
warranty costs; and c.) reduced margins in the capacitive business line
relating to lower volumes in gaming and entertainment sales and higher costs
associated with a recent ramp in production capacity. While the latter two
factors may improve in the next several quarters, the impact of the investment
in Methuen-based resistive production capacity is not likely to improve until
mid to late 2001 when the Company has completed a planned transition to offshore
production of resistive touchscreens.
RESEARCH AND DEVELOPMENT. Research and development expenses for the quarter
ended July 1, 2000 were effectively unchanged from the corresponding period of
1999. As a percentage of net sales, research and development expenses increased
from 7.6% in the second quarter of 1999 to 8.6% in the second
8
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quarter of 2000. For the six-month period ended July 1, 2000, research and
development expenses increased from the corresponding period of 1999 by $513,000
or 8%, and increased as a percentage of net sales from 8.2% in 1999 to 9% in
2000. The increase in research and development expenses resulted primarily from
the continued investment in programs to develop improvements in touchscreen
technologies, especially a next generation version of capacitive products.
SALES AND MARKETING. Sales and marketing expenses in the quarter ended July 1,
2000 decreased from the corresponding period of 1999 by $1,098,000 or 19%. As a
percentage of net sales, sales and marketing expenses decreased from 13.9% in
the second quarter of 1999 to 12.6% in the second quarter of 2000. For the six-
month period ended July 1, 2000, sales and marketing expenses decreased from the
corresponding period of 1999 by $1,029,000 or 9%, and decreased as a percentage
of net sales from 14.3% in 1999 to 13.1% in 2000. The decrease primarily
relates to the reduction of sales and marketing expenses associated with the
Factura and IBID product lines, both of which were sold by the Company in 2000.
GENERAL AND ADMINISTRATIVE. General and administrative expenses in the quarter
ended July 1, 2000 decreased from the corresponding period of 1999 by $99,000 or
3%. As a percentage of net sales, general and administrative expense increased
from 7.3% for the second quarter of 1999 to 7.6% for the second quarter of 2000.
For the six-month period ended July 1, 2000, general and administrative expenses
increased over the corresponding period of 1999 by $399,000 or 7%, and increased
as a percentage of net sales from 6.9% in 1999 to 7.6% in 2000. The increase was
primarily due to increased costs in Asia Pacific to support the growth in the
region.
AMORTIZATION OF INTANGIBLE ASSETS. For the three and six month periods ended
July 1, 2000, operating expenses included $55,000 and $110,000, respectively, of
amortization relating to various acquisitions and purchases of technologies, as
compared to $100,000 and $214,000, respectively, for the corresponding periods
of 1999. As of July 1, 2000, all intangible assets relating to prior
acquisitions have been fully amortized.
OTHER INCOME. Other income in the quarter ended July 1, 2000 increased from the
corresponding period of 1999 by $212,000. This increase was primarily due to a
$314,000 gain on the sale of the IBID product line. Interest income, net
of interest expense, on the Company's cash and investment portfolio for the
second quarter of 2000 was $29,000 compared to $197,000 for the second quarter
of 1999, reflecting a decrease in the size of the Company's investment
portfolio, which is discussed under "Liquidity and Capital Resources".
LITIGATION COSTS. During the first quarter of 1999, the Company recorded a
charge of $3.3 million related to a judgement against the Company in a lawsuit.
While the matter is continuing in post-trial proceedings, the Company has
established a reserve for the full amount of the judgement, as well as estimated
associated legal fees.
PROVISION FOR INCOME TAXES. The Company's effective tax rate was 31% and 32% in
the first half of 2000 and 1999, respectively. The 2000 effective tax rate
differed from the federal statutory rate of 34% primarily as a result of the
benefit related to tax exempt interest income and the utilization of foreign net
operating losses.
LIQUIDITY AND CAPITAL RESOURCES
As of July 1, 2000, the Company had net working capital of $43.5 million,
including approximately $18.2 million in cash, cash equivalents and marketable
securities. The Company reported net cash provided by operating activities of
$2.7 million for the six months ended July 1, 2000. Additionally, the Company
maintains bank lines of credit, including letters of credit, in the U.S. and the
U.K. totaling $9.9 million. As of July 1, 2000, the Company had a total of
$4.95 million outstanding under its bank lines of credit.
During 1999, the Board of Directors of the Company approved extensions to a
repurchase program of the Company's common stock. Under the 1999 extensions,
the amount of common stock to be
9
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repurchased is not to exceed $13.0 million. During the six months ended July 1,
2000, the Company repurchased approximately 85,000 shares at an aggregate cost
of $1,082,000. These shares have been and will be used for the Company's stock
option plans, employee stock purchase plan and for other corporate purposes,
possibly including acquisitions.
During the six months ended July 1, 2000, the Company invested $2,789,000 in
capital expenditures.
Pending operational needs, the Company has invested its cash in investment
grade, interest-bearing securities. The Company believes that these cash
investments, together with anticipated cash flows from operations pursuant to
its current operating plan, will be sufficient to meet the Company's operating
working capital requirements, at least through 2001. In addition, in the
future, the Company may pursue additional sources of financing for the expansion
of its resistive product line, in particular. While the Company regularly
evaluates acquisition candidates, conducts preliminary discussions regarding
acquisitions and may pursue acquisition opportunities available to it, there can
be no assurance that any such acquisition will be made or, if made, whether such
acquisition will be financially successful.
The discussion contained in this section, as well as elsewhere in this Form 10-
Q, may contain forward-looking statements within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act of 1995.
Such statements are based on the current expectations of the Company's
management. Such statements are subject to certain risks and uncertainties
which could cause actual results to differ materially from those described in
the forward-looking statement. Readers are cautioned not to place undue
reliance on these forward-looking statements which speak only as of the date
hereof. The Company undertakes no obligation to publicly release the result of
any revisions to these forward-looking statements which may be made to reflect
events or circumstances occurring after the date hereof or to reflect the
occurrence of unanticipated events.
FOREIGN EXCHANGE EXPOSURE
Significant portions of the Company's operations are conducted in foreign
countries, including the United Kingdom of Great Britain, Germany, France,
Italy, Spain, Australia, Taiwan, Japan, Hong Kong and Korea. Exchange rate
fluctuations between the U.S. dollar and the currencies of these countries
result in fluctuations in the amounts relating to foreign operations reported in
the Company's consolidated financial statements. In general, the Company's
policy is not to enter into derivative financial instruments or other financial
instruments to manage foreign currency exchange rate risk. The Company can
provide no assurances that it will not enter into such financial instruments in
the future.
SUPPLY EXPOSURE
Although the Company generally uses standard parts for its product, certain
components, such as ASICs, topsheets and the coated glass used in the production
of touch sensors, are currently available only from a single source. In the
event that suppliers are unable to fulfill the Company's requirements, the
resulting interruption in production would have an adverse impact on the
Company's operating results. While the Company maintains some inventory of
ASICs, coated glass, topsheets and other components, the inventory amounts
maintained are not sufficient to eliminate the potential impact of prolonged
supply interruptions. While the Company believes that there are other companies
that are capable of manufacturing these sole source components, the inability to
obtain sufficient components as required, or to develop alternative sources if
and when needed, would adversely affect the Company's operating results.
10
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PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On April 25, 2000, Target Stores, a division of Target Corporation, filed a
complaint against the Company, which was removed on May 18, 2000 to the United
States District Court for the District of Minnesota. The complaint, which
alleges damages in the amount of approximately $1.4 million plus related costs,
contains claims for negligence and intentional misrepresentation concerning the
quality and performance of MicroTouch touchscreens purchased by Target for the
store's gift registry. The case is currently in its early stages. The Company
believes it has meritorious defenses to the allegations raised in the complaint
and plans to vigorously defend its reputation and rights.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Annual Meeting of Stockholders held on June 22, 2000, the Company's
stockholders voted as follows:
a) To reelect Mr. Edward J. Stewart, III to the Board of Directors for a three
year term.
Total votes for the nominee 5,413,822
Total votes against the nominee 175,442
The terms of Messrs. Peter E. Brumme, D. Westervelt Davis, James D. Logan
and Frank Manning as directors continued after the meeting.
b) To approve Arthur Andersen LLP as independent auditors of the Company for
the year ended December 31, 2000.
Total votes for the proposal 5,565,756
Total votes against the proposal 19,838
Abstentions 3,670
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) 27. Financial Data Schedule. Filed herewith.
b) None
11
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MicroTouch Systems, Inc.
Dated: August 14, 2000 BY: /s/ Geoffrey P. Clear
--------------------------------
Geoffrey P. Clear
Vice President -
Finance & Administration,
Chief Financial Officer & Treasurer
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