<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
Summit Technology 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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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/ / 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
SUMMIT TECHNOLOGY, INC.
21 HICKORY DRIVE
WALTHAM, MA 02154
Dear Shareholder:
It is a pleasure to invite you to your Company's 1996 Annual Meeting in
Boston, Massachusetts, on Wednesday, May 29, beginning at 9:00 a.m. local time,
at the Omni Parker House Hotel, 60 School Street, Boston. This will be Summit
Technology's eighth Annual Meeting of Shareholders and it marks a time of
important transition for the Company and its investors. I hope that those who
find the time and place convenient will attend the meeting.
Whether you own a few or many shares of stock and whether or not you plan
to attend in person, it is important that your shares be voted on matters that
come before the meeting. I urge you to specify your choices by marking the
enclosed proxy card and returning it promptly. If you sign and return your proxy
card without specifying your choices, it will be understood that you wish to
have your shares voted in accordance with the directors' recommendations.
Thank you for your interest.
Sincerely,
/s/ David F. Muller, Ph.D.
DAVID F. MULLER, PH.D.
President and Chairman
<PAGE> 3
SUMMIT TECHNOLOGY, INC.
21 HICKORY DRIVE
WALTHAM, MA 02154
NOTICE OF SPECIAL MEETING IN LIEU OF
1996 ANNUAL MEETING OF STOCKHOLDERS
A Special Meeting in Lieu of 1996 Annual Meeting of Stockholders
("Meeting") of Summit Technology, Inc. ("Company") will be held at the Omni
Parker House Hotel, 60 School Street, Boston, Massachusetts, on May 29, 1996 at
9:00 A.M. to consider and act upon the following matters:
1. To elect two directors to serve for three-year terms;
2. To transact such other business as may properly come before the Meeting
or any adjournment or adjournments of the Meeting.
Stockholders of record at the close of business on April 1, 1996 are
entitled to receive notice of and to vote at the Meeting.
All stockholders are cordially invited to attend the Meeting.
By Order of the Board of Directors
/s/ Peter E. Litman
PETER E. LITMAN, Clerk
April 12, 1996
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY CARD AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE IN
ORDER TO ASSURE THAT YOUR SHARES ARE REPRESENTED AND VOTED AT THE MEETING. NO
POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
<PAGE> 4
SUMMIT TECHNOLOGY, INC.
21 HICKORY DRIVE
WALTHAM, MA 02154
PROXY STATEMENT FOR SPECIAL MEETING IN LIEU OF
1996 ANNUAL MEETING OF STOCKHOLDERS
MAY 29, 1996
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Summit Technology, Inc. ("Company") for use
at the Special Meeting in Lieu of 1996 Annual Meeting of Stockholders
("Meeting") to be held on May 29, 1996 and at any adjournments thereof. Each
signed and returned proxy will be voted in accordance with the instructions, if
any, of the stockholder(s) executing such proxy. If a stockholder attends the
Meeting and votes in person, his or her proxy will not be counted. A signed
proxy may be revoked at any time before it is exercised in person or by giving
written notice of revocation to the Clerk of the Company at the above address.
The Board of Directors (hereinafter sometimes referred to as the "Board")
has fixed April 1, 1996 as the record date for determining the stockholders
entitled to vote at the Meeting. On that date there were 29,253,689 shares of
common stock, $.01 par value ("Common Stock"), of the Company issued, of which
29,253,689 were outstanding and entitled to vote. Each share of Common Stock is
entitled to one vote.
This Proxy Statement and the accompanying proxy card and Annual Report are
being mailed to stockholders on or about April 12, 1996.
PROPOSAL NUMBER ONE
ELECTION OF DIRECTORS
The Company's Articles of Organization and By-Laws fix the number of
directors at five and provide for the election of directors to staggered,
three-year terms. Two directors will be elected at this Meeting for a term
ending at the 1999 annual meeting of stockholders (and until his successor is
elected and qualified). The Board has nominated David F. Muller and John A.
Norris for re-election as directors.
Unless otherwise instructed, the persons named in the proxy will vote to
elect such nominees as directors. Although the Board does not contemplate that
the nominees will be unavailable to serve as directors, if for some reason any
nominee is unable to serve, the enclosed proxy will be voted for such
substituted nominee(s), if any, as may be designated by the Board. In no event
will the proxy be voted for more than two directors.
The following information summarizes the recent business experience and
qualifications of the nominees:
Dr. Muller co-founded the Company in 1985 and has been its President,
Chief Executive Officer and Chairman of the Board since its inception.
Prior to founding the Company, Dr. Muller was a founder of ExciMed
Technologies, a joint venture acquired by the Company. From 1983 to 1985,
Dr. Muller was a product manager for Lambda Physik of Acton, Massachusetts,
where he was responsible for development of excimer laser products and
marketing strategies. Dr. Muller received an A.B. in chemistry and physics
from Boston University, a Ph.D. in physical chemistry from Cornell
University and an M.B.A. from the Wharton School.
Mr. Norris was elected to the Board in May 1990 and was re-elected in
1993. Since February, 1994, Mr. Norris has served as President of John A.
Norris, Esquire, P.C. a health care law, public policy and management
consulting firm founded in February, 1994. Mr. Norris was President and
Chief Executive
<PAGE> 5
Officer of National Pharmaceutical Council, Inc., an educational resource
for research-based pharmaceutical companies, from April 1995 to March 1996.
From June 1988 through February 1994, he was executive vice president of
Hill and Knowlton, Inc., a consulting and public relations firm, and served
as the worldwide director of its Health Sciences Consulting Group. Prior to
joining Hill and Knowlton in 1988, Mr. Norris served as deputy commissioner
and chief operating officer of the FDA from 1985 to 1988, where his main
responsibility was overseeing the operations of the FDA. Mr. Norris has
taught healthcare policy at Harvard University since 1988. Mr. Norris
currently serves as a director of Cytologies, Inc., Horus Inc. and National
Applied Sciences, Inc.
The re-election of Messrs. Muller and Norris requires the affirmative vote
of the holders of a majority of the outstanding shares of Common Stock entitled
to notice of and to vote at the Meeting. See "Voting Procedures" for a
discussion of the method by which votes, including abstentions and broker
non-votes, will be tabulated.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RE-ELECTION OF MESSRS.
MULLER AND NORRIS AS DIRECTORS.
OWNERSHIP OF SECURITIES
<TABLE>
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock on February 28, 1996, (i) by each person
who is known by the Company to own beneficially more than five percent (5%) of
the outstanding shares of the Company's Common Stock, (ii) by each of the
Company's directors, (iii) by the Company's Chief Executive Officer, (iv) by
each of the four highest paid executive officers who earned over $100,000 in
1995, (v) by up to two additional individuals who would have qualified as an
officer pursuant to item (iv) but for the fact that such individuals were not
serving as executive officers as of December 31, 1995 and (vi) by all directors
and executive officers as a group.
<CAPTION>
SHARES PERCENT
BENEFICIALLY BENEFICIALLY
BENEFICIAL OWNER OWNED(1) OWNED(2)
---------------- ------------ ------------
<S> <C> <C>
David F. Muller............................................. 1,726,457(3) 5.82%
Jeffrey A. Bernfeld......................................... 10,100(4) *
Richard F. Miller........................................... 500(5) *
John A. Norris.............................................. 14,708(6) *
Richard M. Traskos.......................................... 18,079(7) *
Rajiv Bhatt................................................. 4,050(8) *
Ray H. Krauss............................................... 15,603(9) *
Peter E. Litman............................................. 44,416(10) *
John Frantzis............................................... 399(11) *
All Executive Officers and Directors as a
Group (14 persons)(3)(4)(5)(6)(7)(8)(9)(11)............... 6.57%
<FN>
- ---------------
* Less than 1% of the outstanding Common Stock
(1) Except as otherwise noted, the Company believes that the persons named in
the table have sole voting and investment power with respect to the shares
of Common Stock set forth opposite such persons' name. Amounts shown
include the shares issuable pursuant to stock options which may be
exercised within 60 days of February 28, 1996.
</TABLE>
2
<PAGE> 6
(2) Determined on the basis of 29,239,609 shares outstanding, except that
shares underlying options exercisable within 60 days of February 28, 1996
are deemed outstanding for calculating the percentage owned by holders
thereof.
(3) Does not include options to purchase 24,000 shares of Common Stock at
$16.17 per share, which are not exercisable within 60 days of February 28,
1996, and includes options to purchase 416,550 shares, which are presently
exercisable, and 696 shares held in the Company's 401(k) plan.
(4) Does not include options to purchase 1,500 shares of Common Stock at $25.31
per share, which are not exercisable within 60 days of February 28, 1996
and includes options to purchase 9,000 shares, which are presently
exercisable.
(5) Does not include options to purchase 1,500 shares of Common Stock at $25.31
per share, which are not exercisable within 60 days of February 28, 1996
and includes options to purchase 500 shares which are currently
exercisable.
(6) Does not include options to purchase 1,500 shares of Common Stock at $25.31
per share, which are not exercisable within 60 days of February 28, 1996
and includes options to purchase 9,000 shares which are currently
exercisable.
(7) Does not include options to purchase 1,500 shares of Common Stock at $25.31
per share, which are not exercisable within 60 days of February 28, 1996
and includes options to purchase 9,000 shares, which are presently
exercisable. Includes 1,050 shares owned by Mr. Traskos' wife as to which
Mr. Traskos disclaims beneficial ownership.
(8) Does not include options to purchase 48,000 shares of Common Stock at
$18.00 per share, which are not exercisable within 60 days of February 28,
1996, and includes options to purchase 4,050 shares, which are presently
exercisable.
(9) Does not include options to purchase 8,616 shares of Common Stock at $12.42
per share and options to purchase 15,384 shares of Common Stock at $13.00
per share, which are not exercisable within 60 days of February 28, 1996,
and includes options to purchase 15,384 shares, which are presently
exercisable, and 219 shares held in the Company's 401(k) plan.
(10) Does not include options to purchase 18,000 shares of Common Stock at
$14.50 per share and options to purchase 6,000 shares of Common Stock at
$18.83, which are not exercisable within 60 days of February 28, 1996, and
includes options to purchase 43,873 shares, which are presently
exercisable, and 543 shares held in the Company's 401(k) plan.
(11) Does not include options to purchase 12,264 shares of Common Stock at
$19.50 per share, options to purchase 602 shares of Common Stock at $19.17
and options to purchase 286 shares at $16.83 per share, which are not
exercisable within 60 days of February 28, 1996, and includes 399 shares
held in the Company's 401(k) plan.
3
<PAGE> 7
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning the executive
officers and directors of the Company.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
David F. Muller.......................... 47 President, Chief Executive Officer and
Chairman of the Board
Howard P. Apple.......................... 55 Vice President, Research and Development
Rajiv P. Bhatt........................... 38 Executive Vice President, Treasurer and
Chief Financial Officer
Kimberley A. Doney....................... 38 Executive Vice President, Quality,
Regulatory and Clinical Affairs
John G. Frantzis......................... 40 Vice President, Sales
Ronald Herskowitz........................ 41 Executive Vice President, Professional
Business Development
Peter J. Klopotek........................ 42 Vice President, Science and Technology
Ray H. Krauss............................ 46 Executive Vice President and Chief of
Operations
Peter E. Litman.......................... 44 Executive Vice President and General
Counsel
Jeffrey A. Bernfeld(2)................... 38 Director
Richard F. Miller(1)..................... 44 Director
John A. Norris........................... 49 Director
Richard M. Traskos(1,2).................. 48 Director
</TABLE>
[FN]
- ---------------
(1) Audit Committee
(2) Compensation Committee
Dr. Apple joined the Company in March 1994 from Critikon, a Johnson &
Johnson company, where he served for eleven years, most recently as research
fellow and prior to that as director of research and development and business
development director. Critikon develops and manufactures critical care
instrumentation and devices. Dr. Apple holds a Ph.D. and an M.S. in biomedical
engineering and electrical engineering from Case Western Reserve University, an
M.B.A. from Columbia University and a B.A. in physics/math from Carleton
College.
Mr. Bhatt joined the Company in September 1994. Prior to Summit, Mr. Bhatt
was the Chief Financial Officer and a member of the Board of Directors of
Carlisle Plastics, Inc., a diversified manufacturer of consumer plastic
products. In this capacity, Mr. Bhatt was responsible for all financial and
administrative functions. Mr. Bhatt holds an M.B.A. in corporate finance from
the University of Michigan and a bachelor of commerce degree from the University
of Bombay. Mr. Bhatt is a certified public accountant.
Ms. Doney joined the Company in October 1989 as the Vice President of
Regulatory and Clinical Affairs. Prior to joining the Company, Ms. Doney was a
consultant for Endosonics, Inc., where she was responsible for preparation of
marketing, educational and clinical investigation materials. From 1983 to 1989,
Ms. Doney was employed by Trimedyne, Inc., a medical laser company, her last
position being vice president of clinical affairs. Ms. Doney holds an M.B.A.
from the University of Southern California and a B.A. from the University of
California.
4
<PAGE> 8
Mr. Frantzis joined the Company in August 1990 as North American Sales
Manager. Mr. Frantzis was promoted to the position of Worldwide Sales Manager in
1991, to Director of Sales in 1994 and to his current position as Vice President
of Sales in January 1995. Prior to joining the Company, Mr. Frantzis was a
regional manager for ADC Telecommunications, a manufacturer of central office
switching and test equipment. Mr. Frantzis holds a Bachelor's degree in Business
Administration from Washington & Jefferson College.
Dr. Herskowitz joined the Company in September 1993 from Polymer Technology
Corp., a wholly owned subsidiary of Bausch & Lomb. Polymer is a world leader in
the development and sale of specialty contact lens materials and solutions. He
was employed by Polymer from March 1986 until joining the Company, most recently
as vice president, research and development and prior to that as vice president,
technical affairs. Dr. Herskowitz holds a Doctor of Optometry degree from the
Illinois College of Optometry and a B.A. in Chemistry from Knox College.
Dr. Klopotek joined the Company in January 1987 as Manager of Laser
Development. Dr. Klopotek was promoted to the position of Chief Scientist in
1990 and to Vice President, Science and Technology in October 1991. Prior to
joining the Company, Dr. Klopotek was project manager at Lambda Physik GmbH in
Gottingen, Germany from 1984 to 1986. Dr. Klopotek holds a Ph.D. in physics from
the Max Planck Institute and an M.S. in electrical engineering.
Mr. Krauss joined the Company in May 1992 from Iolab/SITE Microsurgical
Systems, Inc., an ophthalmic equipment company and subsidiary of Johnson &
Johnson, where he served as division vice president from December 1988 to May
1992. Mr. Krauss holds an M.B.A. and an M.S.E.E. from Case Western Reserve and a
B.S.E.E. from Lehigh University.
Mr. Litman joined the Company in September 1990. Prior to joining the
Company, Mr. Litman was a partner for six years with the law firm of Goldstein &
Manello, P.C., the Company's principal law firm. Mr. Litman served as outside
legal counsel to the Company from August 1986 through August 1990. Mr. Litman
received a J.D. from Columbia University School of Law and a B.A. from the
University of Pennsylvania.
Mr. Miller was elected to the Board in June 1988 and was re-elected in 1994
for a three year term expiring in 1997. Since August, 1994, Mr. Miller has
served as an investment executive with First Albany Corporation, a financial
services firm. From 1991 through August, 1994 Mr. Miller was a private investor,
and prior to that was an investment banker employed by Tucker, Anthony & R.L.
Day, Inc., from 1979 to 1991, where he last held the position of first vice
president.
Mr. Traskos was elected to the Board in March, 1987 and was re-elected in
1995 for a three year term expiring in 1998. Since March 1993, Mr. Traskos has
served as vice president of Arthur A. Watson & Company, Inc., a business
insurance brokerage firm located in Wethersfield, Connecticut. Previously, Mr.
Traskos served as a director and senior vice president of Allen, Russell &
Allen, Inc., a business insurance brokerage and consulting firm. Mr. Traskos is
a licensed insurance broker and certified insurance consultant.
Mr. Bernfeld was elected to the Board in October, 1988 and was re-elected
in 1995 for a three year term expiring in 1998. Mr. Bernfeld is vice president
and general counsel of American Science and Engineering, a manufacturer of x-ray
based detection equipment. Mr. Bernfeld was vice president and general counsel
of Spire Corporation, a publicly held company specializing in biomaterials,
optoelectronics and energy technologies from June 1992 to February 1996. From
1991 through June, 1992, Mr. Bernfeld was a principal of the consulting firm
Global Solutions, Inc. and from 1988 to 1990 Mr. Bernfeld was vice president and
general counsel of the Mediplex Group, Inc. Prior to joining Mediplex, Mr.
Bernfeld was a partner with the law firm of Goldstein & Manello, P.C., the
Company's principal law firm.
5
<PAGE> 9
Director Liability. The Company's Articles of Organization provide that
directors are not liable to the Company or its shareholders for monetary damages
for breach of fiduciary duty except for: (a) any breach of the director's duty
of loyalty to the Company or its shareholders, (b) acts or omissions not in good
faith or that involve intentional misconduct or knowing violations of law, (c)
under the Massachusetts Business Corporation Law, provisions imposing joint and
several liability for improper distributions to shareholders or loans to
officers or directors, (d) transactions from which a director derived an
improper personal benefit, or (e) for any act or omission occurring prior to the
effective date of such provision.
Indemnification of Directors and Officers. The Company's By-Laws require
the Company to indemnify all officers, directors, employees and agents of the
Company against all liabilities and expenses they may incur on account of all
actions threatened or brought against them by reason of their services to the
Company. No indemnification is provided for any person with respect to any
matter as to which such person has been adjudicated in any proceeding not to
have acted in good faith in the reasonable belief that his action was in the
best interests of the Company.
The Company maintains a director's and officer's liability insurance policy
in the aggregate amount of $3,000,000 on behalf of its directors and officers.
The insurance policy expires on October 28, 1996, unless renewed or earlier
terminated.
OTHER TRANSACTIONS AND RELATIONSHIPS
On January 14, 1991, the Company loaned $405,490 to David F. Muller, the
Company's Chairman of the Board, President and Chief Executive Officer at an
annual interest rate of 7.25%, which was more than 1% over the rate the Company
was earning on its invested cash at the time of the loan. The loan is repayable
on demand. As of March 31, 1996, $275,000 of principal remained outstanding on
the loan. The largest amount of principal outstanding during the fiscal year
ended December 31, 1995 was $350,000. In addition during the fiscal year ended
December 31, 1995, Douglas Adams, the Company's former Vice President, Sales and
Marketing and Kimberly Doney, the Company's Executive Vice President, Quality,
Regulatory and Clinical Affairs repaid in full loan balances of $100,000, and
$204,750, respectively.
See "Compensation Committee Interlocks and Insider Participation" for
information regarding transactions between the Company and a firm with which Mr.
Traskos is affiliated.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT OF 1934
Section 16 of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file with the Securities
and Exchange Commission initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of the Company. Officers,
directors and greater than ten-percent shareholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms they
file.
To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31, 1995, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent beneficial owners were complied with, except that one
report covering one transaction was filed late by each of Messrs. Muller, Miller
and Norris.
6
<PAGE> 10
INFORMATION CONCERNING THE
BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors of the Company held 3 meetings and acted by
unanimous consent 5 times during 1995. Each director then serving attended more
than 75% of such Board meetings and meetings of all committees of the Board on
which he served.
The Company has a standing Audit Committee of the Board of Directors, which
provides the opportunity for direct contact between the Company's independent
public auditors and the Board. The Audit Committee met 2 times during 1995 to
review the financial results for 1994, to review the audit plan for 1995 to
review the adequacy of financial statement disclosures, to discuss the Company's
internal control policies and procedures and to consider and recommend the
selection of the Company's independent auditors. The current Audit Committee
members are Messrs. Miller and Traskos.
The Company also has a standing Compensation Committee of the Board of
Directors, which provides recommendations to the Board regarding compensation
programs of the Company and administers the Company's 1987 Stock Option Plan and
the 1991 Employee Stock Purchase Plan, including making recommendations
regarding issuance of stock options and shares of Common Stock to employees. The
Compensation Committee met once in 1995 and once in 1996. The current
Compensation Committee members are Messrs. Bernfeld and Traskos. Members of the
Compensation Committee may not be granted options under any of the Company's
plans during the one year period prior to serving on the Committee and during
their tenure on the Committee, except that members of the Committee who are
otherwise eligible to participate in the 1992 Stock Option Plan For Outside
Directors may receive grants of options under such Plan.
The Company does not have a Nominating Committee.
7
<PAGE> 11
EXECUTIVE COMPENSATION
The following table shows for the fiscal years ended December 31, 1995,
1994 and 1993 compensation paid or accrued by the Company to those persons who
were at December 31, 1995 (i) the Company's Chief Executive Officer, (ii) the
four other most highly compensated executive officers of the Company who were
serving as executive officers as of December 31, 1995 and (iii) up to two
additional individuals who would have qualified as an officer pursuant to item
(ii) but for the fact that such individuals were not serving as executive
officers as of December 31, 1995:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
---------------------------------- ------------
OTHER SECURITIES
NAME AND ANNUAL UNDERLYING ALL OTHER
PRINCIPAL FISCAL SALARY BONUS COMPENSATION OPTIONS/ COMPENSATION
POSITION YEAR ($) ($) ($) SAR'S (#) ($)(1)
--------- ------ -------- ------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
David F. Muller................ 1995 216,346 29,138(2) 6,600(3) -- 3,485
President, CEO and 1994 200,172 -- 6,600(3) 450,000(4) 4,375
Chairman of the Board 1993 191,348 20,000 -- -- 4,069
Rajiv Bhatt.................... 1995 165,788 21,363(2) -- -- 138
Executive Vice President 1994 62,269 -- -- 61,500(5) 36
and Chief Financial Officer 25,000(5)
Ray H. Krauss.................. 1995 158,568 12,290(2) -- -- 3,411
Executive Vice President 1994 154,121 3,500 -- 3,000(6) 3,605
and Chief of Operations 1993 148,041 15,000 15,368 30,765(6) 322
Peter E. Litman................ 1995 157,737 19,814(2) -- -- 3,230
Executive Vice President 1994 148,031 3,500 -- 7,500(7) 3,092
and General Counsel 5,000(7)
1993 140,084 15,000 -- 30,000(7) 2,996
10,000(7)
John Frantzis.................. 1995 129,838 21,825(2) 6,000(3) 18,000(8) 2,277
Vice President, Sales 1994 125,300 -- -- 903(8) 1,288
1993 124,744 -- -- 859(8) 1,747
</TABLE>
The Company issued a dividend of one share of the Company's Common Stock
for every two shares of outstanding Common Stock paid to shareholders on
December 1, 1995. All share amounts have been restated to reflect this dividend.
[FN]
- ---------------
(1) Includes the following Company contributions to its 401(k) plan and premiums
on group term life insurance:
<TABLE>
<CAPTION>
401(K) TERM LIFE
OFFICER CONTRIBUTION($) PREMIUMS($)
- ------------ --------------- -----------
<S> <C> <C>
Muller 3,000 485
Bhatt -- 138
Krauss 3,000 411
Litman 3,000 230
Frantzis 2,188 89
</TABLE>
(2) Bonus received in the form of stock options to purchase shares of Company
Stock and is deemed annual compensation and is, therefore, not included as
long-term compensation. The amounts are calculated based on the excess of
the fair market value of the Company Stock over the option price at the date
of grant. The amount included for Mr. Frantzis includes a $15,000 1994 cash
bonus received in 1995.
(3) Represents taxable fringe benefit for automobile expense.
8
<PAGE> 12
(4) During the year ended December 31, 1994, Dr. Muller received options to
purchase 450,000 shares of Common Stock of Refractive Centers International,
Inc. ("RCII"), a wholly-owned subsidiary of the Company.
(5) Mr. Bhatt commenced employment in September of 1994. During the year ended
December 31, 1994, Mr. Bhatt received options to purchase 61,500 shares and
25,000 shares of Company Stock and Common Stock of RCII, respectively.
(6) During the year ended December 31, 1994, Mr. Krauss received options to
purchase 3,000 shares of Common Stock of RCII. During the year ended
December 31, 1993, Mr. Krauss received options to purchase 30,765 shares of
Company stock.
(7) During the years ended December 31, 1994 and 1993, Mr. Litman received
options to purchase 7,500 and 30,000 shares of Company Stock, respectively.
During the years ended December 31, 1994 and 1993, Mr. Litman also received
options to purchase 5,000 and 10,000 shares of Common Stock of RCII,
respectively.
(8) During the years ended December 31, 1995, 1994 and 1993, Mr. Frantzis
received options to purchase 18,000, 903 and 859 shares of Company Stock,
respectively.
The following tables show, as to the executive officers named in the
Summary Compensation Table, information as to options granted and exercised
during the fiscal year ended December 31, 1995:
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE AT
ASSUMED ANNUAL
NUMBER OF % OF TOTAL RATES OF STOCK MARKET
SECURITIES OPTIONS/SAR'S PRICE APPRECIATION PRICE ON
UNDERLYING GRANTED TO EXERCISE OR FOR OPTION TERM DATE OF
OPTIONS/SAR'S EMPLOYEES IN BASE PRICE EXPIRATION ------------------- GRANT
NAME GRANTED(#)(1) FISCAL YEAR ($/SHARE) DATE 5%($) 10%($) ($/SHARE)
---- ------------- ------------- ----------- ---------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
David F. Muller...... 5,550 5.63 20.00 10/09/05 117,269 252,481 25.25
Rajiv Bhatt.......... 4,050 4.10 20.00 10/09/05 85,575 184,243 25.25
Ray H. Krauss........ 2,341 2.37 20.00 10/09/05 49,464 106,497 25.25
Peter E. Litman...... 3,774 3.82 20.00 10/09/05 79,743 171,687 25.25
John Frantzis........ 18,000 18.24 19.50 01/05/05 220,742 559,403 19.50
1,300 1.32 20.00 10/09/05 27,468 59,140 25.25
</TABLE>
[FN]
- ---------------
(1) Generally, an employee may exercise an option only while employed by the
Company or within three (3) months of termination of employment. All options
vested on grant date, except the 18,000 options granted to Mr. Frantzis that
vest 20% per year commencing on the first anniversary of the date of grant.
All options are to purchase shares of Company Stock. The amounts include
options granted as 1995 non-cash bonus compensation.
The Company issued a dividend of one share of the Company's Common Stock
for every two shares of outstanding Common Stock paid to shareholders on
December 1, 1995. All share amounts have been restated to reflect this dividend.
9
<PAGE> 13
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SAR'S AT OPTIONS/SAR'S AT
SHARES FY-END (#) FY-END ($)
ACQUIRED ON VALUE --------------------- ----------------------
EXERCISE REALIZED EXERCISABLE/ EXERCISABLE/
NAME (#) ($)(1) UNEXERCISABLE UNEXERCISABLE
---- ----------- -------- ------------- -------------
<S> <C> <C> <C> <C>
David F. Muller..... -- -- 416,550/ 24,000(2) 12,240,443/421,920(2)
-- -- 150,000/300,000(3) -/- (3)
Rajiv Bhatt......... 13,500 268,995 4,050/ 48,000(2) 55,688/756,000(2)
-- -- 5,000/ 20,000(3) -/- (3)
Ray H. Krauss....... 22,957 476,881 15,384/ 24,000(2) 319,218/502,997(2)
-- -- 600/ 2,400(3) -/- (3)
Peter E. Litman..... 15,000 357,600 48,873/ 24,000(2) 1,186,471/436,020(2)
-- -- 5,000/ 10,000(3) -/- (3)
John Frantzis....... 6,750 135,171 2,023/ 19,189(2) 30,207/274,505(2)
<FN>
- ---------------
(1) Represents the excess of the fair market value of the Company Stock over the
option price at the date of exercise.
(2) Options to purchase shares of Common Stock of the Company.
(3) Options to purchase shares of Common Stock of RCII. The Company believes
that the exercise price of these options is at or above fair market value;
therefore, the options are not in-the-money.
</TABLE>
Compensation Of Directors. The Company currently pays $2,000 per year to
its outside directors for their services as directors and $1,000 per year per
committee to each outside director for serving on Board committees. The Company
also pays each outside director $2000 for each Board meeting attended, and $500
for each committee meeting attended.
In addition, the Company's outside directors (the "Participants") are
eligible to participate in the 1992 Stock Option Plan For Outside Directors
Plan, which constitutes a "formula plan" for purposes of Section 16b-3
promulgated under the Securities Exchange Act of 1934. Pursuant to this Plan,
each Participant has been granted as of February 28, 1996, options to purchase
42,000 shares of Common Stock (at prices ranging from $10.5 to $25.31 per
share). Provided that a Participant remains a director of the Company, he will
be granted two additional options to acquire 3,000 shares of Common Stock on
each of January 1, 1997 and January 1, 2000 at 100% of market value. The Company
issued a dividend of one share of the Company's Common Stock for every two
shares of outstanding Common Stock paid to shareholders on December 1, 1995. All
share amounts have been restated to reflect this dividend.
Employment Agreements. As of January 1, 1993, the Company entered into a
three-year employment agreement with David F. Muller, Chairman of the Board,
President and Chief Executive Officer, which expired on December 31, 1995. The
Company has no employment agreements with any of its employees.
Compensation Committee Interlocks and Insider Participation. The
Compensation Committee of the Board of Directors consists of Mr. Traskos and Mr.
Bernfeld. Arthur A. Watson & Company, Inc., a firm with which Mr. Traskos is
affiliated, currently serves as one of the Company's insurance brokers. The
aggregate premiums paid for insurance placed by Arthur A. Watson on behalf of
the Company in 1995 amounted to approximately $485,000. The Company anticipates
an increase in premiums paid for insurance placed by Arthur A. Watson & Company,
Inc. on its behalf during the fiscal year ending December 31, 1996 due to an
increase in coverage required for its U.S. vision correction centers. The
Company believes that all transactions
10
<PAGE> 14
with Arthur A. Watson & Company, Inc. are on terms no less favorable than those
available from other companies.
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1993, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this Proxy Statement, in whole or in part, the following Report of the
Compensation Committee and the Performance Graph shall not be incorporated by
reference into any such filings.
REPORT OF THE COMPENSATION COMMITTEE
The primary goals of the 1995 executive compensation program established
and administered by the Compensation Committee are to attract, retain and
recognize the achievements of superior executives, and to compensate these
executives in a manner that will both recognize their individual performance and
align their interests with the interests of the Company's stockholders, as
measured principally by stock performance. At the current stage of the Company's
development, the Compensation Committee also strives to administer the
compensation program to conserve cash resources of the Company to the extent
possible.
General Policies. For 1995, the executive compensation program consists of
three principal components: base salary, cash bonus and stock options. The level
and mix of each of these components is determined on a case by case basis
without reference to specific criteria or formulas.
Base Salary. In setting the base salary of each executive, the
Compensation Committee takes into account the following factors: (i) the
executive's individual performance and contribution to the management team; (ii)
the performance of the Company over the evaluation period by reference to the
Company's stock value and its progress towards its goals of obtaining regulatory
approvals for sale of its products in the United States and achieving market
acceptance of procedures performed with its products; and (iii) base salaries of
executives in comparable positions in comparable companies. The Committee
considers salaries of executives in other companies for the purpose of
determining what it believes to be the minimum base salary necessary to recruit
a superior executive, and then to retain such executive. The Committee intends
to target base salary levels of the Company's executive officers to the low end
of the range of such comparable companies in keeping with the objective of
conserving cash resources to the extent possible. In setting base salary, the
Committee takes into account all components of an executive officer's
compensation package, believing that the Company's overall compensation packages
places the Company's executive officers in the middle of the range of comparable
companies. The companies considered comparable by the Compensation Committee are
not necessarily those represented in the peer group used by the Company in
preparing its Performance Graph, but rather are companies of a comparable size,
stage of development and industry located in the New England area, as well as
its primary competitor in the United States. In determining base salary, the
Committee reviews the foregoing factors as they relate to each executive
individually and applies each factor subjectively, without reference to specific
criteria. The Committee does not weigh any one factor more or less heavily than
any other and considers the input of the Chief Executive Officer and several
senior executives in reaching its determinations.
Cash and Non-Cash Bonuses. Cash and non-cash bonuses are awarded to
individual executives principally as a mechanism to recognize and reward the
executive's role in achieving short-term performance objectives of the Company.
The Committee has not established specific, quantitative measures for awarding
cash and non-cash bonuses, but rather awards such bonuses in such amounts as
individual achievements warrant, based on subjective criteria and the
recommendations of the Chief Executive Officer.
11
<PAGE> 15
Stock Options. The Compensation Committee views grants of stock options as
a major component of an executive's compensation, believing that the grant of
options aligns the interests of the executives with the interests of the
stockholders by providing a direct correlation between an increase in the value
of the Company's stock and executive compensation and that this method of
compensation allows the Company to conserve cash resources. The Compensation
Committee's present intention is to make substantial stock option grants to
executives every three years, although options may be granted in each year to
achieve an overall compensation package deemed appropriate by the Committee. The
Committee has also granted to certain executive officers options to purchase
stock of the Company's clinic subsidiary, Refractive Centers International,
Inc., to reward individual efforts in developing that aspect of the Company's
business.
In determining the size of a stock option award for an individual executive
officer, the Committee considers the same factors used for determining base
salary and applies each factor subjectively, without reference to specific
criteria. The Committee does not weigh any one factor more or less heavily than
any other and considers the input of the Chief Executive Officer, several senior
executives and the Company's Human Resources staff in reaching its
determinations. The size of previous option grants are not an important factor
in determining current awards. Options are typically exercisable at the market
price on the date of the grant, except in the case of recruitment packages,
which sometimes include options at below market price. The Company has not yet
adopted a policy with respect to the million dollar cap on deduction of
executive compensation.
Compensation of the Chief Executive Officer. The compensation of the
Company's President and Chief Executive Officer, David F. Muller, is determined
according to the factors and in the manner discussed above. In determining Dr.
Muller's compensation for the current year, the Committee primarily considered
the performance of the Company's stock value and the Company's progress towards
the goal of obtaining required regulatory approvals in the United States.
Although Dr. Muller had an employment contract in 1995, his base salary, bonus
and stock options are determined on an annual basis by the Compensation
Committee. The Committee believes that Dr. Muller's base salary for the most
recent fiscal year was at the low end of base salaries for chief executive
officers of its primary competitor and of comparable companies. The Compensation
Committee's intention is to provide Dr. Muller with a strong overall
compensation package. While Dr. Muller's compensation package is not based on
literal formulas or specific targets, the Compensation Committee has crafted a
package which, in its view, based on subjective considerations, reflects the
short-term and long-term performance of the Company.
The Compensation Committee is composed of the two individuals whose names
appear below, both of whom are independent directors of the Company. The
Compensation Committee has the power and authority to administer all components
of the Company's compensation program for executive officers of the Company.
Compensation Committee
Jeffrey A. Bernfeld
Richard M. Traskos
April 12, 1996
12
<PAGE> 16
PERFORMANCE GRAPH
The following Performance Graph assumes an investment of $100 on December
31, 1990 and compares annual percentage changes thereafter in the market price
of the Company's Common Stock with a market index of U.S. NASDAQ traded
securities (NASDAQ Market Index -- U.S.) and an industry index (Dow Jones
Medical and Biological Technology Index). The Company paid no dividends during
the periods shown; the performance of the indices is shown on an actual return
(dividend reinvestment) basis. The graph lines merely connect year-end dates and
do not reflect fluctuations between those dates.
<TABLE>
<CAPTION>
Dow Jones
Medical &
Summit Biolo gical
Measurement Period Technology, NASDAQ Stock Technology
(Fiscal Year Covered) Inc. Market - U.S. Index
<S> <C> <C> <C>
1990 100 100 100
1991 213 160 243
1992 236 187 210
1993 166 213 183
1994 224 208 209
1995 401 302 358
</TABLE>
SELECTION OF AUDITORS
The Company has selected KPMG Peat Marwick LLP ("Peat Marwick"),
independent certified public accountants, to act as its auditors and to audit
the financial statements of the Company and its subsidiaries for the year ending
December 31, 1996. Peat Marwick performed the audit of the Company's financial
statements for 1995.
Representatives of Peat Marwick have been invited to the Annual Meeting and
are expected to be present at the Meeting. They will have the opportunity to
make a statement if they so desire, and will be available to respond to
appropriate questions from stockholders.
VOTING PROCEDURES
The holders of a majority of the shares of outstanding Common Stock
entitled to vote at the Meeting shall constitute a quorum for the transaction of
business at the Meeting. Shares of Common Stock present in person or represented
by proxy (including shares which abstain or do not vote with respect to one or
more of the matters presented for stockholder approval) will be counted for
purposes of determining whether or not a
13
<PAGE> 17
quorum is present at the Meeting. Shares of Common Stock which are not voted,
including "broker non-votes" (i.e., shares held by a broker or nominee for a
beneficial holder as to which the broker or nominee does not have discretionary
voting power and does not receive voting instructions from the beneficial owner)
will not be counted for purposes of determining whether or not a quorum is
present.
The affirmative vote of a majority of the shares of outstanding Common
Stock entitled to vote at the Meeting is required for the election of the
nominees for Director (Proposal 1). Abstentions and broker non-votes will not be
counted as affirmative votes for purposes of obtaining the required approvals
with respect to these Proposals and will have the effect of a vote against such
Proposals.
OTHER MATTERS
The Board of Directors knows of no other matters that may come before the
Meeting. If any other matters should properly come before the Meeting, it is the
intention of the persons named in the accompanying proxy to vote in accordance
with their judgment on such matters. Such discretionary authority is conferred
by the proxy.
All costs of this solicitation, which is being made principally by mail,
will be borne by the Company. Solicitation of proxies may be supplemented by
telephone or personal contacts by the Company's directors, officers and
employees without additional compensation. Brokers will be requested to forward
proxy soliciting material to the beneficial owners of the stock held in such
brokers' names, and the Company will reimburse them for their expenses incurred
in complying with the Company's request.
STOCKHOLDER PROPOSALS
In order to be considered for presentation at the 1997 Annual Meeting of
Stockholders, and to be included in the proxy statement and form of proxy for
that meeting, stockholder proposals must be received by the Company at its
corporate offices in Waltham, Massachusetts, no later than December 14, 1996.
By Order of the Board of Directors
PETER E. LITMAN, Clerk
April 12, 1996
14
<PAGE> 18
PROXY
SUMMIT TECHNOLOGY, INC.
PROXY FOR SPECIAL MEETING IN LIEU OF ANNUAL MEETING
OF STOCKHOLDERS MAY 29, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned appoints David F. Muller and Peter E. Litman, and either
one of them, proxies of the undersigned, with power of substitution, to act for
and to vote all shares of Summit Technology, Inc. common stock owned by the
undersigned upon the matters set forth in the Notice of said Meeting and the
related Proxy Statement, at the Special Meeting in Lieu of the Annual Meeting of
Stockholders to be held at the Omni Parker House Hotel, 60 School Street,
Boston, Massachusetts, at 9:00 a.m. on May 29, 1996, and any adjournments
thereof. The proxies, and either one of them, are further authorized to vote, in
their discretion, upon such other business as may properly come before the
meeting, or any adjournments thereof.
This proxy is solicited on behalf of the Board of Directors.
1. Election of Directors:
NOMINEES: David F. Muller, John A. Norris
/ / FOR all nominees
INSTRUCTIONS: To withhold authority to vote for any individual nominee,
write that nominee's name in the space provided below.
- ------------------------------------------------------------------------------
Your shares will be voted for each of these proposals unless you withhold
authority where indicated.
Check here for address change / / and write new address on the reverse side of
this proxy.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE.
Dated: ___________________________, 1996
___________________________________ L.S.
___________________________________ L.S.
(Note: Please sign exactly as your name appears
hereon. When shares are held by joint tenants,
both should sign. Fiduciaries and corporate
officers should indicate their full titles.)
