TRACOR
Tracor, Inc., 6500 Tracor Lane, Austin, Texas 78725-2000
NOTICE OF ANNUAL MEETING
April 22, 1997
The Annual Meeting of the Shareholders of Tracor, Inc. will be held at
Tracor, Inc., 6500 Tracor Lane, Austin, Texas 78725-2000, on Tuesday,
April 22, 1997, at 10:00 a.m., for the following purposes:
1. To elect two regular directors;
2. To approve an amendment to the 1995 Stock Plan for Employees of
Tracor, Inc. and its Subsidiaries to increase the number of shares to
be issued under the plan from 1,000,000 to 2,000,000;
3. To approve and ratify the selection by the Board of Directors of
Ernst & Young, LLP as independent auditors for 1997; and
4. To transact such other business as may properly come before the
meeting.
Shareholders of record at the close of business on Friday, March 7,
1997, are entitled to receive notice of, and to vote at, the meeting.
A list of Shareholders entitled to vote will be kept at the offices of
Tracor, Inc., 6500 Tracor Lane, Austin, Texas 78725-2000, for a period
of 10 days prior to the meeting.
BY ORDER OF THE BOARD OF DIRECTORS, March 21, 1997
Russell E. Painton
Secretary
YOUR VOTE IS IMPORTANT!
PLEASE PROMPTLY MARK, DATE, SIGN, AND
RETURN YOUR PROXY IN THE ENCLOSED ENVELOPE.
<PAGE> Tracor, Inc.
6500 Tracor Lane, Austin, Texas 78725-2000
PROXY STATEMENT
FOR
ANNUAL MEETING OF
SHAREHOLDERS
TO BE HELD ON APRIL 22, 1997
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Tracor, Inc. ("Tracor" or the "Company") of
proxies to be voted at the Annual Meeting of Tracor Shareholders on
April 22, 1997. This Proxy Statement and the accompanying Proxy Card
are being mailed to shareholders on or about March 27, 1997. Business
at the Annual Meeting is conducted in accordance with the procedures
determined by the presiding officer and is generally limited to matters
properly brought before the meeting by or at the instance of the Board
of Directors or by a shareholder pursuant to provisions requiring
advance notice and disclosure of relevant information.
The expense of preparing, printing, and mailing proxy materials to the
Company's shareholders will be borne by the Company. In addition to
solicitations by mail, a number of regular employees of the Company may
solicit proxies on behalf of the Board of Directors in person or by
telephone. The Company will reimburse brokerage houses and other
nominees for their expenses in forwarding proxy materials to verified
owners of the Company's stock.
VOTING OF PROXIES
Shareholders are urged to read carefully the material in this Proxy
Statement, specify their choice on each matter by marking the
appropriate boxes on the enclosed Proxy Card, and sign, date, and return
the card in the enclosed postage-paid envelope. If no choice is
specified and the card is properly executed and returned, the shares
will be voted by the management of Tracor. A shareholder of record who
executes a proxy may revoke or revise that proxy at any time before the
meeting or, by voting by ballot at the meeting, cancel any proxy
previously returned.
If any nominees for director named in Item 1. (Election of Directors),
beginning on page 4, should be unavailable for election, the proxies
will be voted for the election of such other person as may be
recommended by the Company in place of such nominee.
Shareholders of record at the close of business on Friday, March 7,
1997, are entitled to receive notice of the meeting and to vote the
shares held on that date. Each share is entitled to one vote. The
holders of at least a majority of the outstanding shares of common stock
must be represented in person or by proxy at the Annual Meeting for the
meeting to be held. With regard to the election of directors, votes may
be cast in favor of or withheld from each nominee; votes that are
withheld will not be counted either for or against any of the nominees.
Abstentions may be specified on all proposals, except the election of
directors, and will be counted as present for purposes of determining
the existence of a quorum for holding the meeting and with respect to
the item on which the abstention is noted. The affirmative vote of a
majority of the shares represented at the meeting, in person or by
proxy, is required for approval of all matters to be voted upon. In the
case of the election of directors, an abstention would be counted as a
vote against the election of the director. Under the rules of the New
York Stock Exchange (NYSE), brokers who hold shares in street name have
the authority to vote on certain items when they have not received
instructions from beneficial owners. Under applicable Delaware law, a
broker non-vote will have no effect on the outcome of the election of
directors or the other matters to be voted on. Votes will be tabulated
by ballot counters appointed by the Company.
OWNERSHIP OF TRACOR, INC. COMMON STOCK
The following tables set forth as of February 24, 1997, certain
information known to the Company with respect to the beneficial
ownership (as defined in the rules of the Securities and Exchange
Commission hereafter, the "SEC" or the "Commission") of Tracor Common
Stock by all directors, the chief executive officer and the other
executive officers named on the summary compensation table, all
directors and executive officers as a group and any person who is known
by the Company to be the beneficial owner of more than five percent of
the Tracor Common Stock. The percentages are calculated including
shares which are subject to outstanding warrants and options held by
directors and officers.
<TABLE>
<CAPTION>
Name and Address of Number of Percent(1)
Beneficial Owner Shares
------------------- --------- ----------
<S> <C> <C> <C>
Dr. Julian Davidson 6,000(2) *
1240 Deborah Drive, S.E.
Huntsville, AL 35801
Anthony Grillo 16,000(3) *
358 Oxford Drive
Short Hills, NJ 07078
Bob Marbut 30,500(4) *
511 Argyle
San Antonio, TX 78209
Elvis L. Mason 1,416,871(5) 5.7%
3716 Maplewood
Dallas, TX 75205
Lt. Gen. Thomas P.
Stafford (Retired) 10,000(6) *
Coral Harbor Club
Unit C-44
88181 Old Highway-MM88
Islamorada, FL 33036
James B. Skaggs 287,849(7) 1.2%
Tracor, Inc.
6500 Tracor Lane
Austin, TX 78725-2000
Barry G. Campbell 32,583(8) *
16327 Bawtry Court
Bowie, MD 20715
Robert K. Floyd 67,829(9) *
Tracor, Inc.
6500 Tracor Lane
Austin, TX 78725-2000
George R. Melton 63,400(10) *
Tracor, Inc.
6500 Tracor Lane
Austin, TX 78725-2000
Dr. Terry A. Straeter 190,833(11) *
GDE Systems, Inc.
16550 West Bernardo Drive
San Diego, CA 92127
William E. Conway 18,046(12) *
The Carlyle Group
1001 Pennsylvania Avenue, NW
Suite 220 South
Washington, DC 20004
Gerald B. Unterman 2,038,474(13) 8.0%
70 E. 55th Street
New York, NY 10022
Edward C. Johnson 1,481,700(14) 6.0%
82 Devonshire Street
Boston, MA 02109
Warburg, Pincus 1,464,200 5.9%
Counsellors, Inc.
446 Lexington Avenue
New York, NY 10017
All directors and 2,453,534(15) 9.7%
executive officers as a
group, including those
names above.
</TABLE>
1 * = less than 1%.
2 2,000 shares are held directly by Dr. Davidson;
4,000 shares are held pursuant to stock options,
none of which are currently exercisable.
3 12,000 shares are held directly by Mr. Grillo;
4,000 shares are held pursuant to stock options,
none of which are currently exercisable.
4 26,500 shares are held directly by Mr. Marbut;
4,000 shares are held pursuant to stock options,
none of which are currently exercisable.
5 6,000 shares of common stock are held directly by Mr. Mason.
Mr. Mason is the president of E. L. Mason Corporation,
which is the general partner of MB Partners, Ltd. ("MB Partners"),
which is the general partner of the Mason Best Company, L.P.
("Mason Best"). Mason Best directly owns 1,398,067 shares of
common stock. Mr. Mason owns 50% of the general partner of Mason
Best, MB Partners; however, Mr. Mason holds 100% of the voting
rights in the general partner of Mason Best. In addition,
Mr. Mason is the managing partner of Mason Best. As a result,
Mr. Mason may be deemed to beneficially own 100% of the shares
held by Mason Best. MB Partners directly owns 8,804 shares of
common stock, and Mr. Mason owns 100% of E.L. Mason
Corporation, which is the general partner of MB Partners, and
may be deemed to beneficially own 100% of the shares held by
MB Partners. 4,000 shares are held pursuant to stock options,
none of which are currently exercisable.
6 6,000 shares are held directly by Lt. Gen. Stafford;
4,000 shares are held pursuant to stock options,
none of which are currently exercisable.
7 250,520 shares are held pursuant to currently exercisable stock
options. In addition, 5,000 shares are held pursuant to Series
A Warrants which are convertible into common stock, and 32,329
shares are held directly.
8 1,583 shares are held directly, and 31,000 shares are held
pursuant to currently exercisable stock options.
9 2,329 shares are held directly, and 64,500 shares are held
pursuant to currently exercisable stock options. In addition,
1,000 shares are held pursuant to Series A Warrants which are
convertible into common stock.
10 6,800 shares are held directly, and 56,600 shares are pursuant
to currently exercisable stock options.
11 18,000 shares are owned directly by Dr. Straeter, and 160,333
shares are held by a family trust over which Dr. Straeter has
control. In addition, 7,500 shares are held pursuant to
currently exercisable stock options, and 5,000 shares are
issuable upon exercise of Series A Warrants.
12 14,046 shares are held directly, and 4,000 shares are held
pursuant to stock options, none of which are currently exercisable.
13 GBU, Inc. is the sole general partner of Oak Tree Partners, L.P.
and GEM Convertible Securities Partners, L.P. GBU beneficially
owns 1,177,599 shares of Tracor common stock (which are directly
owned by Oak Tree Partners, L.P.) and 152,500 Series A
Warrants (which are directly owned by GEM Convertible Securities
Partners, L.P.) to purchase Tracor common stock. Mr. Unterman
is the president, majority shareholder, and a director of
GBU, Inc. He is also the president, sole shareholder, and a
director of GEM Capital Management, Inc. GEM Capital Management,
Inc. is a registered investment advisor whose accounts own 60,001
shares of Tracor common stock which Mr. Unterman may be deemed to
beneficially own. Mr. Unterman is the trustee of a profit sharing
plan which owns 34,000 shares of Tracor common stock.
In addition, Mr. Unterman owns directly 100,000 shares of Tracor
common stock and 514,375 Series A Warrants.
With respect to the 1,177,599 shares owned by Oak Tree Partners,
L.P., GBU owns a 9.9% interest in that partnership and Gerald B.
Unterman owns 83% of GBU, Inc. Therefore, Mr. Unterman claims
beneficial ownership of only 97,740 of those shares.
With respect to the 152,500 shares which may be acquired upon
the exercise of the 152,500 Series A Warrants owned by GEM
Convertible Securities Partners, L.P., GBU, Inc. owns a 1%
interest in that partnership, and Mr. Unterman owns 83% of
GBU, Inc. Therefore, Mr. Unterman claims beneficial ownership
of only 1,266 of those shares.
14 Mr. Johnson is the chairman of FMR Corp. which beneficially
owns 1,481,700 shares of Tracor common stock. Fidelity
Management and Research Company, a wholly owned subsidiary of
FMR Corp., is the beneficial owner of 1,396,700 shares of Tracor
common stock. Mr. Johnson through his control of Fidelity
Management and Research Company has sole dispositive power over
1,396,700 shares. Mr. Johnson and FMR Corp., through its control
of Fidelity Management Trust Company, each have sole dispositive
power over 85,000 and sole power to vote or to direct the voting
of 82,300 shares, and no power to vote or to direct the voting
of 2,700 shares of Tracor common stock.
15 Includes shares subject to outstanding warrants and options held
by directors and officers.
OUTSTANDING VOTING SECURITIES
The number of voting securities of Tracor outstanding on Friday,
February 27, 1997, was 24,772,691 shares of common stock, $.01 par
value, owned by approximately 292 shareholders of record.
1. ELECTION OF DIRECTORS.
Pursuant to the General Corporation Law of the State of Delaware, as
implemented by Tracor's Certificate of Incorporation and Bylaws, all
corporate powers are exercised by or under the direction of the Board of
Directors, and the Company's business, property, and affairs are managed
by or under the direction of the Board.
The Board of Directors has created committees with responsibility for
audits, compensation, and ethical issues. Each director who is not an
employee of Tracor or a subsidiary serves on one or more committees.
See Committees of the Board.
Two directors are to be elected at this meeting to serve until 2000 or
until their successors have been elected and qualified. Messrs. Conway
and Marbut are currently directors of the Company and have been
nominated by the Board of Directors for election at this Annual Meeting.
Outside (non-employee) directors of the Company receive annual Board
retainers of $20,650, plus travel and allowances where appropriate.
Attendance fees of $1,000 per meeting are also paid. Directors who also
serve on a committee of the Board of Directors receive $950 for each
committee meeting attended. Directors who chair committees receive an
additional $950 per meeting attended. Directors who are currently on
the board at the first of each year receive 1,000 shares of common stock
and are granted 2,000 shares of stock options at the then current market
price.
A vacancy in any director position may be filled by a majority vote of
the remaining directors. The individual elected to the vacant director
position will serve until the next Annual Meeting of Shareholders.
During 1996, the Board of Directors met six times. Each director
attended more than 75% of the aggregate of (a) the total number of
meetings held during 1996 and (b) the total number of meetings held by
all committees of the Board of Directors on which each served.
Following are the nominees of the Company, with information including
their age, principal occupation and other business affiliations, the
year each was first elected as a director, the Board committee
memberships of each, and other affiliations.
The Board of Directors recommends a vote FOR each of the nominees listed
below.
William E. Conway, Jr. has been a director since April 25, 1995.
Mr. Conway joined The Carlyle Group in August 1987 and is a managing
director. He serves on the boards of directors of BDM International,
Inc. (October 1990 to present); GTS Duratek, Inc. (January 1995 to
present); and Highwaymaster, Inc. (June 1994 to present). He also
serves on the boards of several private companies in which Carlyle has
invested. Prior to the acquisition of GDE Systems, Inc. ("GDE"), he
served as chairman of the board of GDE.
Bob Marbut has been a director of the Company since November 1991. He is
a member of the Compensation/Stock Option Committee. Mr. Marbut is
chairman and CEO of Argyle Television, Inc., which he helped found in
1994 and which now owns and operates television stations in the United
States. He is also chairman and CEO of Argyle Communications, Inc.
(founded in January 1992), which is the managing general partner of
Argyle Communications Partners, L.P., a limited partnership involved in
the acquisition and operation of television stations, and successor to
The Argyle Group, of which he has been chairman and CEO since January
1992. Mr. Marbut founded Argyle Television Holdings, Inc., a television
station group in 1993, and was its CEO until it was sold in April 1995.
He serves on the boards of directors of Premark International, Inc.
(1986 to present); Diamond Shamrock, Inc. (March 1990 to present);
Argyle Communications, Inc. (January 1992 to present); Argyle
Television, Inc. (August 1994 to present); and Katz Media Group, Inc.
(August 1994 to present).
REMAINING DIRECTORS AND TERMS
The directors not up for election at this Annual Meeting are:
James B. Skaggs has been a director of the Company since March 1990. He
has also served as the president and CEO of the Company since November
1991. Mr. Skaggs also served as president, CEO, and a director of
Westmark Systems, Inc. from March 1990 through December 1991, and is
currently a director of Alamo Group, Inc. Mr. Skaggs' term expires in
1998.
Elvis L. Mason has been a director of the Company since November 1991.
He is a member of the Compensation/Stock Option Committee. Since August
1984, he has served as managing partner of Mason Best Company, L.P.
("Mason Best"), a merchant banking firm, and on the boards of several
privately held companies in which Mason Best was a significant
shareholder. He also has served, since December 1991, as a director and,
since February 1992, as chairman of the Board and CEO of Safeguard
Business Systems, Inc., a supplier of office management products and
services for small businesses, and its parent, San Jacinto Holdings. Mr.
Mason also serves as a director of United Meridian Corporation and
American Eagle Group, Inc. Mr. Mason's term expires in 1999.
Dr. Julian Davidson has been a director of the Company since November
1991. He is chairman of the Compensation/Stock Option Committee. Dr.
Davidson is president and CEO of Davidson Enterprises, LLC, a commercial
and defense consulting firm since April 1, 1996. Before that, he was a
senior vice president of Booz, Allen and Hamilton from May 1984 to April
1996. He also serves as a director on the boards of several privately
held companies. Dr. Davidson's term expires in 1999.
Anthony Grillo has been a director of the Company since December 1991.
He is chairman of the Audit/Ethics Committee. Mr. Grillo is a senior
managing director of The Blackstone Group, L.P., an investment banking
firm. Prior to May 1991, he was a managing director with the corporate
finance division, Restructuring and Reorganization Group of Chemical
Bank (November 1989 through May 1991). Mr. Grillo currently serves as a
member of the board of directors of Littelfuse, Inc. (since November
1991), a former affiliate of Tracor's predecessor, and of Joule, Inc.,
as well as a member of the board of directors of several privately held
companies. He is also a Trustee of the Academy of Political Science.
Mr. Grillo's term expires in 1999.
Lt. Gen. Thomas P. Stafford (retired) has been a director of the Company
since April 1994. He is a member of the Audit and Ethics Committee. Lt.
Gen. Stafford is a co-founder of the technical consulting firm of
Stafford, Burke, and Hecker, Inc. (1983). He serves on the boards of
directors of AlliedSignal Corporation (March 1981 to present); CMI, Inc.
(1983 to present); Fisher Scientific, Inc. (December 1991 to present);
Pacific Scientific, Inc. (February 1987 to present); Seagate
Technologies, Inc. (March 1988 to present); Tremont, Inc. (October 1990
to present); Wackenhut, Inc. (October 1991 to present); and Wheelabrator
Technologies, Inc. (September 1987 to present), all of which are listed
on the New York Stock Exchange (NYSE). Lt. Gen. Stafford also served on
the board of directors for Gulf USA, Inc. (NYSE) from 1992 to 1993. Lt.
Gen. Stafford's term expires in 1998.
<PAGE>
EXECUTIVE COMPENSATION
The following Summary Compensation Table shows the compensation of the
Company's five most highly compensated executive officers, including the
chief executive officer, for the three most recent fiscal years:
Summary Compensation Table
<TABLE>
<CAPTION>
NAME AND LONG-TERM ALL OTHER
PRINCIPAL POSITION ANNUAL COMPENSATION COMPENSATION COMPENSATION(1)
- ------------------ --------------------------- -------------------------------------- ---------------
AWARDS PAYOUTS
--------------------------- -------
SECURITIES
RESTRICTED UNDERLYING
STOCK OPTIONS/ LTIP
YEAR SALARY BONUS AWARDS SAR (#)2 PAYOUTS
---- ------ ----- ------ -------- -------
<S>
<C> <C> <C> <C> <C> <C> <C> <C>
James B. Skaggs, 1996 $577,533 $490,445 - 0 - 100,000 - 0 - $39,281
President & CEO 1995 523,921 410,987 - 0 - 200,000 - 0 - 28,687
1994 494,884 398,687 - 0 - 9,200 - 0 - 14,916
Terry A. Straeter(3) 1996 $226,900 $174,177 - 0 - 12,000 - 0 - $50,605
Vice President 1995 212,019 138,273 - 0 - 15,000 $243,132 24,296
1994 205,769 265,000 - 0 - 5,000 - 0 - 8,015
Barry G. Campbell, 1996 $235,885 $129,938 - 0 - 12,000 - 0 - $11,865
Vice President 1995 209,244 105,074 - 0 - 20,000 - 0 - 9,699
1994 197,627 81,113 - 0 - - 0 - $212,400 549
Robert K. Floyd, 1996 $230,568 $149,446 - 0 - 12,000 - 0 - $22,585
Vice President & CFO 1995 216,448 126,703 - 0 - 20,000 - 0 - 17,592
1994 189,017 112,933 - 0 - 7,500 - 0 - 4,939
George R. Melton, 1996 $200,366 $133,502 - 0 - 12,000 - 0 - $16,803
Vice President 1995 166,675 88,069 - 0 - 18,000 - 0 - 10,973
1995 167,638 53,093 - 0 - - 0 - - 0 - 9,727
</TABLE>
- ----------
1. Includes term life insurance premiums paid by the Company on
behalf of each named individual.
2. No SARs have been issued as of the dates indicated.
3. During the majority of 1994, Dr. Straeter was employed by
GDE Systems, Inc. when it was a subsidiary of GDE Holdings, Inc.
Option Grants in Fiscal Year 1996(1)
<TABLE>
<CAPTION> Potential Realizable Value
at Assumed Annual Rates
of Stock Price Appreciation
Individual Grants for Full Option Term
---------------------------------------------- ----------------------------
% of Total
Number of Options
Securities Granted to
Underlying Employees Exercise
Options in Fiscal or Expiration
Name Granted 1996 Base Price Date 5% ($) 10% ($)
- -------------------- ---------- ---------- ---------- ---------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
James B. Skaggs 100,000 26.27% 16.13 02/27/2006 $1,014,407.03 $2,570,706.59
Barry G. Campbell 12,000 3.15% 16.13 02/27/2006 121,728.84 308,484.79
Robert K. Floyd 12,000 3.15% 16.13 02/27/2006 121,728.84 308,484.79
George R. Melton 12,000 3.15% 16.13 02/27/2006 121,728.84 308,484.79
Terry A. Straeter 12,000 3.15% 16.13 02/27/2006 121,728.84 308,484.79
- --------------------------------------------------------------------------------------------------
</TABLE>
_____________
1. The per share option exercise prices are the fair market value of the
Company's common stock on the date of the grant, and the term of each
option is 10 years. 30% of each option is exercisable one year after
the date of grant, an additional 30% is exercisable two years after
the grant, and the remainder is exercisable three years after the grant.
Aggregate Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Value of Unexercised
Number of Unexercised In-the-Money Options
Options at Fiscal Year End at Fiscal Year End(1)
Number of --------------------------- --------------------------
Shares Exercisable
Acquired Value at
Name on Exercise Realized 12/31/96 Unexercisable Exercisable Unexercisable
- ------------------ ----------- -------- ----------- ------------- ----------- -------------
<S>
<C> <C> <C> <C> <C> <C> <C>
James B. Skaggs 15,000 $331,875 250,520 243,680 $3,992,930 $1,700,120
Barry G. Campbell -0- -0- 31,000 26,000 377,500 176,940
Robert K. Floyd 1,000 21,630 64,500 29,000 1,101,250 203,940
George R. Melton 3,800 81,592 56,600 24,600 1,001,900 165,390
Terry A. Straeter -0- -0- 7,500 24,500 64,125 166,065
- ------------------------------------------------------------------------------------------------------
</TABLE>
_____________
1. The last sale price of the Common Stock on December 31, 1996 was
$21.25 per share.
Employment Agreements
Effective as of November 22, 1996, the Company entered into employment
agreements (entitled "Employment Agreement") with certain of its
officers who had not previously entered into employment agreements with
the Company and, further, entered into amended and restated employment
agreements (entitled "Amended and Restated Employment Agreement") with
certain of its officers who had previously entered into employment
agreements with the Company. Each of the above-named officers has
executed employment agreements with the Company, except for Dr.
Straeter, whose employment agreement is with GDE Holdings, Inc., a
subsidiary of the Company. All of the agreements provide for a
termination date of December 31, 1999, or the first day of the year
following the year in which the officer reaches his/her 65th birthday.
The agreements also provide for automatic renewals unless terminated
earlier by the officer or the Board of Directors.
Among other things, the employment agreements assure the continuation of
each such officer's base salary as of such date and his/her continued
participation in the Company incentive and other welfare and benefit
plans, as well as continuation of his/her then current level of job
position and responsibilities, failing which such officer may terminate
his/her employment with the Company and receive, as termination pay,
stipulated amounts equal to up to two times such officer's base salary
then in effect and other benefits. Under each employment agreement, the
Company has the right to terminate an officer for cause, under which
circumstances the officer would not be entitled to termination pay. Each
agreement provides that upon termination the officer will not compete
with the Company for a period of six months after the date of
termination nor will the officer divulge confidential information or
trade secrets to third parties.
Retirement Benefits and Related Information
The Company has a Defined Benefit Retirement Plan (the "Retirement
Plan") which provides retirement benefits for its employees and
employees of participating affiliates. The plan has three benefit
formulas as described below for Tracor, Vitro, and GDE employees.
Employees covered under the Tracor formula become vested in the
Retirement Plan upon the completion of five years of vesting service.
Monthly benefits, payable at normal retirement age, are based upon an
amount equal to one percent of final "average monthly compensation" up
to "covered compensation" plus one and one-half percent of final average
monthly compensation in excess of covered compensation, multiplied by
the years of credited service with the Company, less one year. Average
monthly compensation is defined as the average monthly compensation
actually paid, including bonuses and overtime pay for the five highest
successive calendar years. Covered compensation is defined as the
average of the maximum wages subject to social security taxes for the 35
years ending in the calendar year before the employee reached Social
Security retirement age. Credited service is the period of the
employee's total employment with the Company. The monthly benefits are
not subject to deductions for Social Security or other offset amounts.
Employees covered under the Vitro formula are provided monthly benefits,
payable at normal retirement age, which are based on the amount equal to
one and one-tenth percent of average annual compensation up to covered
compensation plus one and three-quarters percent of average annual
compensation in excess of covered compensation, multiplied by the years
of credited service. Average annual compensation means the average of
annual earnings during the employee's five consecutive highest paid
years with Vitro. Credited service generally means all the employee's
years of service with Vitro. The monthly benefits are not subject to
deductions for Social Security or other offset amounts.
Employees covered under the GDE formula are provided monthly benefits,
payable at normal retirement age, which are based on the amount equal to
approximately one and three-tenths percent of average annual
compensation, multiplied by the years of credited service. Average
annual compensation means the average of annual earnings during the
employee's five consecutive highest paid years with GDE. Credited
service generally means all the employee's years of service with GDE.
The monthly benefits are not subject to deductions for Social Security
or other amounts.
The following tables show the estimated annual benefits payable upon
retirement to persons in specified remuneration and years of service
classifications who would retire in 1997 at age 65. The amounts shown in
the tables were determined as normal retirement benefits at December 31,
1996, and were based on pay limited by Section 401(a)(17) of the
Internal Revenue Code (the "Code"). Benefits are limited by Section 415
of the Code without regard to combined plan limitations.
Retirement Plan Benefits
Tracor, Inc.
<TABLE>
<CAPTION>
Years of
Service
--------------------------------------------------
Final Average
Annual Compensation 15 20 25 30 35
- ------------------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
$100,000 $19,070 $25,880 $32,691 $39,501 $46,312
$125,000 24,320 33,005 41,691 50,376 59,062
$150,000 29,570 40,130 50,691 61,251 71,812
$175,000 33,726 46,176 58,626 71,076 83,526
$200,000 37,852 52,176 66,502 80,826 95,152
$225,000 41,976 58,176 74,376 90,576 106,776
$250,000 43,766 60,778 77,792 94,804 111,818
$300,000 43,766 60,778 77,792 94,804 111,818
$350,000 43,766 60,778 77,792 94,804 111,818
$400,000 43,766 60,778 77,792 94,804 111,818
$450,000 43,766 60,778 77,792 94,804 111,818
$500,000 43,766 60,778 77,792 94,804 111,818
$1,281,573(1) 43,766 60,778 77,792 94,804 111,818
</TABLE>
Vitro Corporation(2)
<TABLE>
<CAPTION>
Years of
Service
--------------------------------------------------
Final Average
Annual Compensation 15 20 25 30 35
- ------------------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
$100,000 $23,561 $31,415 $39,269 $47,123 $54,976
$125,000 30,124 40,165 50,206 60,248 70,289
$150,000 36,686 48,915 61,144 73,373 85,602
$175,000 41,963 56,390 70,817 85,244 99,671
$200,000 47,213 63,827 80,442 97,057 113,671
$225,000 52,463 71,265 90,067 108,869 120,000
$250,000 54,739 74,490 94,240 113,991 120,000
$300,000 54,739 74,490 94,240 113,991 120,000
$350,000 54,739 74,490 94,240 113,991 120,000
$400,000 54,739 74,490 94,240 113,991 120,000
$438,987(1) 54,739 74,490 94,240 113,991 120,000
</TABLE>
___________
1. Represents 120% of covered compensation for the most highly compensated
individual who would be entitled to benefits under this particular plan.
2. Employees of Vitro Corporation and Vitro Services Corporation whose
credited service begins on or after January 1, 1996, are covered under
the Tracor benefit formula. Benefits based on $150,000 pay are limited
with a minimum benefit, as of December 31, 1993, under prior pay plan.
GDE Holdings, Inc.
<TABLE>
<CAPTION>
Years of
Service
--------------------------------------------------
Final Average
Annual Compensation 15 20 25 30 35
- ------------------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
$100,000 $20,000 $26,667 $33,333 $40,000 $46,667
$125,000 25,000 33,333 41,667 50,000 58,333
$150,000 30,000 40,000 50,000 60,000 70,000
$175,000 34,000 45,667 57,333 69,000 80,666
$200,000 38,000 51,333 64,667 78,000 91,333
$225,000 42,000 57,000 72,000 87,000 102,000
$250,000 43,734 59,457 75,180 90,902 106,625
$300,000 43,734 59,457 75,180 90,902 106,625
$350,000 43,734 59,457 75,180 90,902 106,625
$400,000 43,734 59,457 75,180 90,902 106,625
$450,000 43,734 59,457 75,180 90,902 106,625
$481,292(1) 43,734 59,457 75,180 90,902 106,625
</TABLE>
___________
1. Represents 120% of covered compensation for the most highly compensated
individual who would be entitled to benefits under this particular plan.
As of December 31, 1996, the persons named in the Summary Compensation
Table were credited with the following years of service under the
Retirement Plan: Mr. Floyd, 6.6; Mr. Skaggs, 6.8; Mr. Melton, 6.8; Dr.
Straeter, 16.8; and Mr. Campbell, 26.6.
The remuneration covered by the Retirement Plan for the named executive
officer generally corresponds with the salary amounts set forth in the
Summary Compensation Table.
Non-Qualified Supplemental Retirement Benefit. During 1993, the Company
established a Non-Qualified Supplemental Retirement Program for certain
of its officers, which was amended and restated effective as of January
30, 1997 (hereafter, the "Program"). The Program provides that upon
normal retirement or termination not for cause, Company officers covered
by the Program will receive a monthly income of up to 50% of the
average compensation for the 36 months immediately prior to the date of
retirement or termination, less the amount of retirement benefits which
the officer would otherwise be entitled to under the Retirement Plan.
The actual amount the participant would be entitled to receive is
determined by the participant's total number of years of service to the
Company after December 21, 1991. The Program further provides that upon
the death of the participant, his or her spouse would also be entitled
to receive a monthly income equal to one-half of the benefit which would
otherwise be payable to the officer. Currently, Messrs. Skaggs, Floyd,
and Melton are participants in the Program. The Program additionally
provides that if any of the participants are terminated without cause,
they shall become immediately 100% vested in the Program, and in
the case of Messrs. Skaggs and Floyd, they may elect to receive the
benefits payable to them under the Program in a lump sum. Assuming the
individuals remain in the employ of the Company until their normal
retirement age, each of the following executives will receive an
annuity, as described above, which, on an actuarial basis, is equal to
the following annual payments: Mr. Skaggs, $465,487; Mr.
Floyd, $166,014; and Mr. Melton, $221,943.
Dr. Straeter is eligible to receive benefits from the GDE Systems, Inc.
Supplemental Retirement Plan. This plan is designed to replace any
pension benefit lost to Dr. Straeter if his final average covered
compensation is in excess of the limitations for eligible compensation
contained in Sections 415 or 401(a)17 of the Code. Assuming Dr. Straeter
remains employed by the Company until his normal retirement age, he will
receive an annuity with an estimated annual payment of $141,282.
Mr. Campbell is eligible to receive benefits from the Tracor Benefit
Restoration Plan. This plan, adopted October 1, 1996, is designed to
replace any pension benefit lost to Mr. Campbell if his final average
monthly covered compensation is in excess of the limitations for
eligible compensation contained in Sections 415 or 401(a)17 of the Code.
Assuming Mr. Campbell remains with the Company until his normal
retirement age, he will receive an estimated lump sum payment of
$1,635,686.
Effective December 1, 1996, Tracor adopted the Tracor Deferred
Compensation Plan designed primarily to replace 401(k) Plan benefits
lost due to the Code limitations on employee deferrals and covered
compensation used to determine benefits from the qualified Tracor, Inc.
401(k) Plan. For 1996 matching contributions were credited in the amount
of $6,612 to Mr. Skaggs; $1,756 to Mr. Campbell; $2,036 to Mr. Floyd;
and $1,670 to Mr. Melton.
COMMITTEES OF THE BOARD
Audit/Ethics Committee
The Committee met three times in 1996. The duties of the Audit/Ethics
Committee are to:
a. recommend to the Board of Directors a firm of independent
auditors to perform the audit of the annual financial statements
of the Company;
b. review with the independent auditors and with financial
management the proposed scope of the annual audit, past audit
experience, the Company's internal audit program, recently
completed internal audits, and other matters bearing upon the
scope of the audit;
c. review with the independent auditors and with financial
management significant matters revealed in the course of the
audit of the annual financial statements of the Company;
d. review on an annual basis whether the Company's ethics policies
have been communicated by the Company to all key employees of
the Company and its subsidiaries;
e. review with financial management any suggestions and
recommendations of the independent auditors of the Company;
f. meet on a regular basis with a representative or representatives
of the Internal Audit Department of the Company and to review
the Internal Audit Department's Reports of Operations; and
g. report its activities and actions to the Board at least once
each fiscal year.
Members of the Audit/Ethics Committee are Anthony Grillo, chairman;
William E. Conway; and Lt. Gen. Thomas P. Stafford.
The independent auditors and Tracor's internal auditor have direct
access to the Committee and may discuss with it any matters which may
arise in connection with audits, the maintenance of internal accounting
controls, or any other matter relating to Tracor's financial affairs.
Furthermore, the Committee may authorize the independent auditors to
investigate any matters which the Committee deems appropriate and may
present its recommendations and conclusions to the Board.
Compensation/Stock Option Committee
The Committee met four times in 1996. The duties of the
Compensation/Stock Option Committee are to:
a. administer the Tracor stock option plan;
b. recommend policies dealing with compensation, position
evaluations, and personnel engagements, transfers, and
terminations, including the Company's annual incentive program;
c. review and recommend major compensation plans;
d. recommend the Company's management development programs and
procedures;
e. approve and recommend to the Board of Directors compensation for
corporate officers; and
f. review the administration of the Company's Retirement Plan.
Members of the Compensation/Stock Option Committee are Julian Davidson,
chairman; Bob Marbut; and Elvis L. Mason.
COMPENSATION/STOCK OPTION COMMITTEE REPORT
Executive Compensation Principles
The Company's Executive Compensation Program is based on guiding
principles designed to align executive compensation with Company values
and objectives, business strategy, management initiative, and business
financial performance. In applying these principles, the
Compensation/Stock Option Committee (the "Committee") has established a
program to:
a. attract and retain key executives critical to the long-term
success of the Company and each of its business groups;
b. reward executives for long-term strategic management and
enhancement of shareholder values;
c. integrate compensation programs with both the Company's annual
and long-term strategic planning and measuring processes; and
d. support a performance-oriented environment that rewards
performance not only with respect to Company goals but also Company
performance as compared to that of industry performance levels.
Executive Compensation Program
The total compensation program consists of both cash and equity-based
compensation. The annual compensation consists of a base salary and an
annual incentive. The Committee determines the level of salary for key
executive officers and a salary range for other executive officers.
Actual salary changes are based upon performance and upon national
industry salary surveys in related industries, depending on the areas in
which the particular executive is employed, and supplemented by other
surveys which are used to enhance the analysis. These surveys covered
essentially the same companies that are included in the table comparing
the cumulative total returns of the Company, set forth below. The
salary levels are targeted to the median of such surveys, with
variations based upon the experience of each officer and the complexity
of his/her particular responsibilities. In considering the salary
increases from 1996 to 1997, the Committee also evaluated each
executive's performance in several areas, including increases in sales
and revenue from the preceding year, increases in profits in the
executive's area of responsibility, and the success of his/her budgetary
controls. No increases were required, or given, pursuant to the terms
of any employment agreements.
Incentive Compensation Program
Effective in December 1991, the Company adopted a performance incentive
plan under which executive officers and other high-level employees may
receive compensation based on the achievement of individual and Company
objectives. Eligible participants include officers and other key
employees of the Company who are in a position to make substantial
contributions to the management, growth, and success of the Company.
Payment of an award is contingent upon the achievement of specified
levels of earnings, bookings, revenue, and cash generation of the
Company or the employee's unit ("performance goals") each year based upon
the annual operating plan of the Company. A smaller portion of each
person's incentive payment is based on individual and organizational
goals such as increases in efficiency of the executive's area of
responsibility, adherence to budgetary plans, and implementation of new
operating procedures and programs. At the close of each fiscal year,
the performance of the operating unit in which the employee participates
is reviewed against the performance goals, division objectives are
evaluated, and awards are issued. In the event the performance goals
are not achieved, the awards are reduced or eliminated entirely. If
performance goals are exceeded, the amount of an award may be increased.
In reviewing the performance of the named executives for 1996, the
Committee determined each individual and Tracor exceeded their
respective goals for the year. Executive officers as a group were
awarded payments totaling $1,749,151.19, and all employees as a group
received payments totaling $7,360,905.42 under this plan in 1996.
Stock Plan
The Company adopted, in December 1991, the Stock Plan for Employees of
Tracor, Inc. and its Subsidiaries (the "1991 Plan"). In April 1995, the
Company adopted the 1995 Stock Plan for Employees of Tracor, Inc. and
its Subsidiaries (the "1995 Plan" or, collectively, the "Stock Plans")
pursuant to which options to purchase common stock of the Company, stock
appreciation rights ("SARs") (rights, granted in tandem with an option
(or alone), to receive cash payments equal to any appreciation in value
of the shares subject to option from the date of the option grant to the
date of exercise in lieu of the exercise of an option), and/or shares of
restricted stock may be granted to officers and other key employees of
the Company and its subsidiaries. The plans are administered by the
Committee which has authority to determine the individuals to whom and
the terms pursuant to which grants shall be made. Per share option
prices are not less than the fair market value of the Company's common
stock on the date of the option grant, and the term of the options
cannot exceed 10 years. The two plans are identical in all material
respects, except that outside directors participate in the 1995 Plan.
Under the Stock Plans, the Committee grants stock options, restricted
shares, and/or SARs based upon its review of surveys and publicly
available information relating to the amount and type of awards granted
to executives in the aerospace and defense industry, as well as its
review of each executive's performance, evaluated as described above.
Through the award of options, the objective of aligning executive
officers' long-range interests with those of the shareholders are met by
providing the executive officers with the opportunity to build a
meaningful stake in the Company.
Officer Compensation
The Compensation Committee of the Board of Directors met for the purpose
of evaluating the performance of the Company's CEO. In accordance with
the Company's Executive Compensation Program, the Committee evaluated
Mr. Skaggs' performance for the year based on both objectively evaluated
quantitative criteria and on subjectively evaluated qualitative
criteria. Mr. Skaggs' base salary and total compensation were also
evaluated with respect to similar positions in the industry using a
number of compensation surveys. The goal of the Committee was to
determine whether an increase in his base salary was merited, and, if
so, how much of an increase should be recommended to the Board. The
Committee additionally determined the amount of incentive compensation
and stock options to recommend that the Board award to Mr. Skaggs.
At the beginning of each fiscal year, the Board of Directors establishes
quantitative and qualitative goals or "targets" for the CEO of the
Company. Results are evaluated at the end of the fiscal year.
Quantitative Goals
For 1996, the Committee evaluated the results of three quantitative
criteria. They were:
Target Actual
(In Millions) (In Millions) % of Target
------------- ------------- -----------
Earnings(1) $ 88.8 $ 104.6 118%
Net Cash Activity 52.5 60.9 116%
Bookings 940.2 1,112.5 118%
________________
1. Before interest, taxes, depreciation, and other deductions.
Qualitative Goals
In addition, the Committee subjectively evaluated the results of
qualitative criteria. The qualitative criteria include:
a. Return on Shareholders' Equity;
b. Share Price Increase;
c. Shareholders' Equity Increase;
d. Achievement of Strategic Business Goals;
e. The Conduct of Business Operations;
f. Board Communications;
g. Equity Restructuring to Reduce Warrants; and
h. Maintain Outstanding Corporate Team
Base Salary and Annual Incentive Compensation
Based upon its review of Mr. Skaggs' overall 1996 performance for base
salary and annual incentive purposes, the Committee determined Mr.
Skaggs significantly exceeded both quantitative and qualitative target
measures. The Committee also considered the Company's 1996 performance
improvements over 1995 in determining the base salary increase. These
improvements included a 22% increase in sales, a 36% increase in
earnings before interest and taxes, a 31% increase in net income, a 12%
increase in firm backlog, and a 41% increase in total backlog. As a
result, the Committee recommended that Mr. Skaggs should receive a base
salary increase of approximately ten percent (10%) effective for the
1997 year.
Mr. Skaggs' annual incentive compensation for 1996 was calculated using
a mathematical equation which took into account quantitative performance
results related to earnings, net cash, and bookings plus the achievement
of qualitative goals as evaluated by the Committee. Using the
mathematical equation and the evaluated incentive results described
above, Mr. Skaggs' recommended annual incentive bonus is 83.13% of his
1996 base salary.
Stock Option Grants
The stock option grants made to Mr. Skaggs under the Company's Stock
Plan were determined using the criteria described under the Stock Plan
referenced previously. Option grants received by Mr. Skaggs in fiscal
year 1996 are noted under the Executive Compensation section showing the
five most highly compensated officers.
Compensation/Stock Option Committee
Dr. Julian Davidson, chairman
Bob Marbut
Elvis L. Mason
Comparison of Cumulative Total Return(1)
Among the Nasdaq Stock Index,
Dow Jones Defense & Aerospace Index,
and Tracor, Inc.
Set forth below is a line graph comparing the cumulative total
shareholder return on the Company's common stock, based on the market
price of the common stock and assuming reinvestment of dividends, with
the cumulative total return of companies on the Nasdaq Stock Index and
the Dow Jones Defense & Aerospace Index.
<TABLE>
[GRAPH APPEARS HERE]
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
Among Dow Jones Aerospace and Defense, Nasdaq National Market, and Tracor, Inc.
<CAPTION>
DJ Aerospace & Nasdaq National Tracor,
Measurement Period Defense Market Inc.
------------------ -------------- --------------- -------
<S> <C> <C> <C>
1st Quarter '92 100.00 100.00 100.00
2nd Quarter '92 95.30 92.57 103.23
3rd Quarter '92 90.83 92.15 83.76
4th Quarter '92 94.94 101.03 125.33
1st Quarter '93 103.61 110.72 166.36
2nd Quarter '93 113.23 110.03 177.98
3rd Quarter '93 121.61 116.88 287.22
4th Quarter '93 127.97 123.14 378.23
1st Quarter '94 140.81 126.40 419.29
2nd Quarter '94 141.60 117.15 352.43
3rd Quarter '94 146.19 119.20 349.76
4th Quarter '94 148.84 121.86 479.42
1st Quarter '95 160.25 128.00 526.66
2nd Quarter '95 194.82 141.28 591.26
3rd Quarter '95 222.32 166.23 729.96
4th Quarter '95 243.11 170.81 699.72
1st Quarter '96 275.53 176.17 706.47
2nd Quarter '96 288.63 196.24 858.46
3rd Quarter '96 306.39 189.15 849.45
4th Quarter '96 329.92 208.51 1,005.75
</TABLE>
- ---------------
1. Assumes $100.00 invested on January 1, 1992, in the Nasdaq
Index, Dow Jones Defense & Aerospace Index, and Tracor, Inc.
<PAGE>
2. TO APPROVE THE AMENDMENT OF THE 1995 STOCK PLAN FOR EMPLOYEES OF
TRACOR, INC. AND ITS SUBSIDIARIES TO INCREASE THE NUMBER OF SHARES
AUTHORIZED FROM 1,000,000 TO 2,000,000.
Tracor adopted the Stock Plan for Employees of Tracor, Inc. and
Subsidiaries (the "1991 Plan") in December 1991 pursuant to the
Reorganization Plan. The Board of Directors determined in 1992 that it
would be appropriate to submit the 1991 Plan for shareholder
ratification, and the 1991 Plan was ratified and approved at the 1992
Annual Meeting of Shareholders. During 1992, options were granted to 29
employees, covering an aggregate of 459,500 shares of common stock.
On February 26, 1993, the Compensation/Stock Option Committee of the
Board of Directors recommended, and the Board of Directors approved, a
proposed amendment to the 1991 Plan which was to increase the total
amount of shares of common stock available thereunder from 500,000
shares to 1,000,000 shares of common stock issued and outstanding, which
was less than 5% of the common stock outstanding on a fully diluted
basis. This recommendation of the Board of Directors was approved and
ratified by the shareholders of the Company at the Annual Meeting of
Shareholders held April 28, 1993.
On December 15, 1994, the Compensation/Stock Option Committee
recommended, and the Board of Directors approved, a resolution to adopt
the 1995 Stock Plan for Employees of Tracor, Inc. and its Subsidiaries
(hereafter, the "1995 Plan.") The 1995 Plan provided for the grant of
an additional one million (1,000,000) shares of common stock of the
Company. Such authorized shares and the authorized shares under the
1991 Plan, represent less than 12.25% of common stock issued and
outstanding, and less than 6% of such shares on a fully diluted basis.
At the Annual Meeting of Shareholders held June 13, 1996, the 1995 Plan
was amended to provide each outside director an annual grant of 1,000
restricted shares of Tracor common stock and 2,000 options to acquire
shares of Tracor common stock.
As of February 28, 1997, a total of 1,000,000 shares have been issued
pursuant to options or grants or are subject to options under the 1995
Plan. In addition, 350,851 options have been granted subject to
shareholder approval of the proposed amendment. On February 12, 1997,
the Compensation/Stock Option Committee recommended, and the Board of
Directors approved, a proposed amendment to the 1995 Plan which would
increase the total amount of shares of common stock available thereunder
from 1,000,000 to 2,000,000 shares, bringing the total number of options
either granted or authorized to approximately 10.5% of the total shares
outstanding, on a fully diluted basis.
The text of the 1995 Plan (as amended on June 13, 1996) is set forth in
the Appendix to this Proxy Statement. The following summary of certain
provisions of the 1995 Plan is not intended to be complete and is
qualified by reference to the Appendix.
Purpose of the Stock Plan. The 1995 Plan is designed to provide key
employees and non-employee directors with an added incentive, to attract
and retain employees of outstanding competence, and to further the
identity of their interest with those of the shareholders. Under the
1995 Plan, a maximum of 2,000,000 shares of Tracor common stock are to
be made available for purchase by non-employee directors, executives and
other key employees of Tracor through the exercise of stock options,
which may be accompanied by stock appreciation rights (collectively,
"Options"). Additionally, shares of common stock of the Company, which
are restricted ("Grants"), may be awarded to such persons, and rights
to acquire shares of common stock ("Stock Rights") or units ("Unit
Rights"), which are restricted, as provided in the 1995 Plan ("Rights"),
may be granted thereto.
Termination and Amendment. The 1995 Plan will terminate on April 25,
2005, after which date awards may no longer be made thereunder. The
Board of Directors may amend or modify the 1995 Plan at any time, but if
any such amendment requires shareholder approval in order to meet the
requirements of the then applicable rules under Section 16(b) of the
Securities Exchange Act of 1934, as amended, or the rules of the Nasdaq
Exchange, then such amendment may not be effected without obtaining such
approval as well as approval of the Company's bank lenders. The Board
of Directors may terminate the 1995 Plan, but any such termination shall
not affect any Option or Right already granted.
Tax Consequences on Grant or Exercise of Options. Options granted or
deemed to be outstanding under the 1995 Plan may either constitute
"Incentive Stock Options," as provided in Section 422 of the Internal
Revenue Code of 1986, as amended, or Options which do not constitute
Incentive Options ("Non-Qualified Options"). The Plan is not qualified
under Section 401(a) of the Internal Revenue Code.
An employee realizes no income at the time an Incentive or Non-Qualified
Option is granted. If and when a Non-Qualified Option is exercised, the
employee will be deemed to receive taxable ordinary income equal to the
excess, if any, of the fair market value of the stock acquired on the
date of exercise over the Option price thereof. Upon such exercise,
Tracor will obtain a corresponding income tax deduction in the same
amount. Upon the exercise of an Incentive Stock Option, an optionee
will not be deemed to receive any ordinary taxable income, and Tracor
will receive no corresponding income tax deduction. The difference in
the market value of the stock, on the date of exercise, and the exercise
price of an Incentive Option is a tax preference item to the employee
for alternative minimum tax purposes. Thereafter, taxation of the
employee's ownership or sale of the stock will be similar to that of any
other investor in the capital stock of Tracor.
Shares Subject to the Stock Plan. The 1995 Plan currently provides for
the issuance of a maximum of 1,000,000 shares of Tracor common stock.
Should any Option granted under the 1995 Plan expire or be canceled
prior to its exercise in full, shares already subject to such Options
may again be subject to an Option under the 1995 Plan. However, shares
surrendered to the Corporation upon the exercise of an Incentive Stock
Option and shares subject to an Incentive Stock Option surrendered upon
the exercise of a Right shall not be available for subsequent award of
additional stock Options.
Adjustments in Shares. Under the 1995 Plan, in the event of any stock
split, stock division, combination of shares, or other capital
reorganization or capital reclassification of the Company, the Board of
Directors may make appropriate adjustments in the number or class of
shares of common stock subject to an Option or the Option price per
share, or both. The Board may also make adjustments to the number and
class of shares available as to any Rights or Grants as it shall, in its
judgment, deem appropriate in order to preserve to the awardee, Rights
substantially proportionate to the Rights existing prior to such events.
Participants Under the Stock Plan. Options, Grants, or Rights may be
granted to key outside directors, executive, administrative,
professional, or technical employees of Tracor or any of its present or
future subsidiaries. At February 20, 1997, 15 executive officers and 70
key employees were participating in the 1995 Plan.
The Company cannot now determine the number of Options, Grants, or SARs
to be received by all current executive officers as a group and all
other key employees as a group following the approval of the amendment.
During 1996, the following options were granted pursuant to the plan:
(i) Non-employee directors: 12,000
(ii) All executive officers: 222,500
(iii) All other officers and key employees: 158,100
Administration of the Stock Plan; Eligibility. The 1995 Plan provides
that the Compensation/Stock Option Committee of the Board of Directors
(the "Committee") will administer the 1995 Plan and make awards
thereunder. The Committee is comprised of (not less than) two members
of the Board of Directors, who serve at the request of the Board. Each
member of the Committee must be a "Non-employee Director" as defined by
Rule 16b-3 under the Securities Exchange Act of 1934, as amended, which
means no member is eligible to receive stock Options, Rights, or Grants
under the Stock Plan while serving on the Committee or within one year
prior to serving thereon. There is no limitation under the Stock Plan
as to the number of Options, Grants, or Rights that may be awarded to
any eligible participant (except outside directors who receive a
specified number of options annually), but no Incentive Stock Option may
be granted to an employee ineligible under the Internal Revenue Code to
receive an Incentive Option because of ownership of 10% or more of the
total voting power of the Company's equity securities.
Options. Each Option granted under the 1995 Plan is evidenced by a
written agreement. An Option granted under the 1995 Plan may either be
an incentive Option or an Option that is not so specified in the
respective Option agreement relating thereto. Each Incentive Option is
subject to the following requirements: (1) the exercise price may not
be less than the fair market value of the common stock of Tracor on the
date of grant; (2) it is non-assignable and non-transferable except in
the case of death; (3) it may not be exercised within six months of the
date of grant; and (4) it will terminate not later than 10 years from
the date of grant. The 1995 Plan imposes no maximum limit on the amount
of Options which may be exercised in any one year.
The provisions of Non-Qualified Options granted under the 1995 Plan are
basically the same as those of the Incentive Options, except the Non-
Qualified Options may be made transferable by the Board of Directors.
Each optionee desiring to exercise an Option must do so by so notifying
Tracor. This notice must be accompanied by payment in full for the
shares so purchased, by tender of cash, check, or, if permitted by the
Committee, by the surrender of outstanding awards under the 1995 Plan,
or that number of shares of the Company's common stock, having an
aggregate market value equal to the purchase price, or any combination
of the foregoing, plus, if applicable, payment of the amount of income
tax due under Section 3402(a) of the Internal Revenue Code (relating to
the receipt of income upon the exercise of Non-Qualified Options). The
Committee may permit such amount to be paid by shares of common stock
previously owned by the employee or a portion of the shares of common
stock that otherwise would be distributed to such employee upon exercise
of the Option, or a combination of cash and shares of such common stock.
Stock Appreciation Rights. Stock Appreciation Rights ("SARs") may be
awarded in connection with an Option either at the time the Option is
granted or thereafter at anytime prior to its exercise, transfer, or
expiration ("Tandem SAR") or separately ("Freestanding Right"). Tandem
SARs are subject to the same terms and conditions as the related
Options. No SAR is exercisable by a Tracor employee (as defined in the
1995 Plan) within six months from the date of award (and then, in regard
to a Tandem SAR, only to the extent that the related Option is
exercisable) or, if the exercise price of the SAR is not fixed on the
date of the award, within six months from the date when the exercise
price is so fixed, and in any case only when the Tracor employee's
election to receive cash in full or partial satisfaction of the SAR, as
well as the Tracor employee's exercise of the SAR for cash, is made
during a quarterly window period (as defined in the 1995 Plan).
Exercises outside a window period may occur under certain conditions.
The exercise price per share specified in a SAR shall be as determined
by the Committee, provided that, in the case of a Tandem SAR, such price
shall be not less than fair market value of the common stock subject to
the related Option on the date of grant.
A SAR shall entitle the employee upon exercise in accordance with its
terms (subject, in the case of a Tandem SAR, to surrender unexercised,
the related Option or any portion or portions thereof which the employee
from time to time determines to surrender for this purpose) to receive
a payment having an aggregate value equal to:
the product of
(i) the excess ofthe fair market value on the exercise date of one
share of common stock over
(ii) the exercise price per share, in the case of a Tandem
SAR, or the price per share specified in the terms of the SAR,
in the case of Freestanding Right, multiplied by
(iii) the number of shares with respect to which the SAR shall
have been exercised.
Payment upon the exercise of a SAR may be made in the form of all cash,
all shares of common stock, or a combination thereof, as elected by the
employee, subject (where the employee is a Tracor officer) to certain
restrictions provided by the 1995 Plan.
Rights. At the time a Right is awarded, the Committee establishes a
period of time (the "Restricted Period") applicable to such award. Each
Right may have a different Restricted Period. The Committee may, at the
time an award is made, prescribe conditions for the incremental lapse of
restrictions during the Restricted Period and for the lapse or
termination of restrictions upon the satisfaction of other conditions in
addition to or other than the expiration of the Restricted Period with
respect to all or any portion of the Right. At the time of award, a
stock certificate representing the number of shares awarded is
registered in the name of the employee and is held in the custody of the
Company. A recipient of a Stock Right shall generally have the rights
and privileges of a shareholder as to such shares, including the right
to vote such shares, except that none of the shares may be sold or
transferred during the Restricted Period. Upon expiration or
termination of the Restricted Period, the restrictions applicable to the
shares lapse, and a stock certificate for the number of shares with
respect to which restrictions have lapsed are delivered to the employee
or the employee's beneficiary or estate, as the case may be.
In the case of a Unit Right, no shares of common stock are issued at the
time the award is made. Upon expiration or termination of the
Restricted Period and the satisfaction of any other conditions
prescribed by the Committee, the Company delivers to the employee or the
employee's beneficiary or estate, as the case may be, one share of
common stock for each Unit Right with respect to which the restrictions
have lapsed.
The Committee may elect to pay cash or part cash and part common stock
in lieu of delivering only common stock for such Unit Rights (equal to
the fair market value of the common stock at the end of the Restricted
Period).
No payment is required from the employee upon the award of any Rights or
the delivery of common stock or the payment of cash in respect to such
Rights, except that any amount necessary to satisfy applicable federal,
state, or local tax requirements shall be withheld or paid promptly upon
notification of the amount due. The Committee may permit such amount to
be paid in shares of common stock previously owned by the employee, or
a portion of the shares of common stock that otherwise would be
distributed to such employee in respect of such Right or a combination
of cash and shares of such common stock.
In addition, the Committee may, upon the expiration of the Restricted
Period in regard to a Right, award cash compensation to the employee for
the purpose of aiding the employee in the payment of any and all
federal, state, and local income taxes payable as a result of such
expiration.
Eligible Retirement, Death, or Total Disability; Change in Control. If
any employee to whom an Option, Right, or Grant has been awarded under
the 1995 Plan shall die or suffer total disability, if an employee
terminates employment pursuant to an eligible retirement, or if a Change
in Control should occur (as defined in the 1995 Plan), such Option or
Right may be exercised, or such Grant shall be deemed to be vested,
whether or not the employee was otherwise entitled at such time to
exercise such Option or Right or be treated as vested in such Grant.
Restrictions on Resale by Certain Employees. Common stock received by
optionees who are "affiliates" (as defined in the Securities Act of 1933,
as amended) of the Company may not be resold other than pursuant to Rule
144 as promulgated by the Securities and Exchange Commission, or
pursuant to Section 4(1) of such Act.
Non-Transferability of Options, Rights, and Grants; Holding Periods for
Officers. Options, Rights, and Grants awarded under the 1995 Plan to
officers and other employees of the Company are not transferable
otherwise than by will or the laws of descent and distribution. Options
and Rights may be exercised during the lifetime of the employee only by
the employee or, unless such exercise would disqualify an Option as an
Incentive Stock Option, by the employee's guardian or legal
representative. Further, any shares of common stock awarded to an
officer of the Company may not be transferred or disposed of for at
least six months from the date of award, and any Option or Right awarded
to an officer of the Company, or the shares of common stock into which
any such Option or Right is exercised or converted, may not be
transferred or disposed of for at least six months following the date of
acquisition by such officer of such Option or Right.
The Board of Directors of the Company may suspend, terminate, modify, or
amend the Plan unless such amendment requires shareholder approval to
meet the requirements of Section 16(b) of the Securities Exchange Act of
1934, which specifies which amendments shall be submitted to the
shareholders of the Company for approval.
The Company believes share ownership by way of options is an excellent
way to attract and retain top quality management and employees.
Therefore, the Board of Directors recommends a vote FOR the following
resolution which will be presented at the meeting:
"RESOLVED, that the resolution of the Board of Directors of the
Company to amend the 1995 Stock Plan for Employees of Tracor, Inc.
and its Subsidiaries to increase the number of shares which are
issuable under the Plan to 2,000,000 shares of common stock, be and
the same is, hereby approved and ratified."
3. APPROVAL AND RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS.
The Board of Directors desires to obtain shareholders' ratification of
the Board's action in appointing Ernst & Young, LLP, Certified Public
Accountants, 700 Lavaca, Suite 1400, Austin, Texas 78701, as independent
auditors of Tracor and its Subsidiaries for the year 1997.
Ernst & Young, LLP has been serving as the independent accountants of
Tracor and its Subsidiaries (including its predecessor) since 1967. It
has no direct financial or material indirect financial interest in
Tracor or any of its subsidiaries and, during the past three years, has
had no connection therewith in the capacity of promoter, underwriter,
voting trustee, director, officer, or employee.
The Board of Directors recommends a vote FOR the following resolution
which will be presented at the meeting:
"RESOLVED, that the appointment, by the Board of Directors of the
Company, of Ernst & Young, LLP as independent auditors of the
Company and its subsidiary companies, for the year 1997, be and the
same is hereby is approved and ratified."
Representatives of Ernst & Young, LLP are expected to be present at the
1997 Annual Meeting, will have an opportunity to make a statement if
they so desire, and will be available to respond to appropriate
questions.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors and persons who own more than 10% of a
registered class of the Company's equity securities to file reports of
ownership and changes in ownership with the Securities and Exchange
Commission (SEC). Officers, directors, and greater than 10%
shareholders are required by SEC regulation to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by the
Company, or written representations from certain reporting persons that
no Form 5s were required for those persons, the Company believes that
the following officers and directors failed to file, or failed to file
on a timely basis, as disclosed in the requisite Forms, reports required
to be filed by section 16(a) of the Securities Exchange Act during the
most recent fiscal year or prior fiscal years. The following
individuals failed to file one or more reports on a timely basis:
Messrs. Melton (one report, one transaction) and Painton (one report,
one transaction). The following individuals failed to file one or more
reports: Messrs. Endsley (one report, one transaction); Floyd (one
report, one transaction); Lawrence (two reports, two transactions);
Marbut (one report, one transaction); Melton (one report, one
transaction); Rock (one report, one transaction); and Dr. Straeter (one
report, one transaction).
OTHER BUSINESS
Tracor is not aware of any business or matters other than those
indicated in this document which may be properly presented at the
meeting.
SHAREHOLDER PROPOSALS
Shareholders who wish to submit proposals to the Company for possible
inclusion in the Company's Proxy Statement for the purpose of
presentation at the Company's Annual Meeting of Shareholders in 1998
must cause such proposals to be received by the Company not less than
120 days in advance of March 21, 1998. If the date of such Annual
Meeting should, subsequent to the date hereof, be advanced from April
22, 1997, by more than 30 days or delayed by more than 90 calendar days,
the Company will so inform the shareholders of such change and the date
by which proposals of shareholders must be received.
MISCELLANEOUS
The information contained in this Proxy Statement relating to the
occupations and security holdings of directors and officers of the
Company and their transactions with the Company, if any, is based solely
upon information provided by the individual as of February 24, 1997.
Please date, sign, and return the Proxy Card at your earliest
convenience in the enclosed envelope. No postage is required for
mailing in the United States. A prompt return of your Proxy will be
appreciated, as it will save the expense of further mailings.
If you plan to attend the Annual Meeting, please check the appropriate
box on your Proxy Card. You have the right, upon your identification as
a shareholder, to attend without prior indication of doing so.
By Order of the Board of Directors,
/s/ Russell E. Painton
----------------------
Russell E. Painton
Secretary
Austin, Texas
March 21, 1997
AMENDED AND RESTATED
1995 STOCK PLAN FOR EMPLOYEES OF
TRACOR, INC. AND SUBSIDIARIES
1. Purpose. Tracor, Inc. (the "Corporation" or "Company")
desires to attract and retain employees of outstanding talent.
The Stock Plan for Employees of Tracor, Inc. and Subsidiaries
(the "Plan") affords eligible employees the opportunity to
acquire proprietary interests in the Corporation and thereby
encourages their highest levels of performance.
2. Scope and Duration.
a. Awards under the Plan may be granted in the following forms:
b. incentive stock options ("incentive stock options"), as
provided in Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code"), and non-qualified stock options
("non-qualified options") (the term "options" includes
incentive stock options and non-qualified options);
c. shares of Common Stock of the Corporation (the "Common
Stock") which are restricted as provided in paragraph 10.
("restricted shares"); or
d. rights to acquire shares of Common Stock which are
restricted as provided in paragraph 10. ("units" or
"restricted units").
Options may be accompanied by stock appreciation rights
("rights").
e. The maximum aggregate number of shares of Common Stock as to
which awards of options, restricted shares, units, or rights
may be made from time to time under the Plan is 2,000,000
shares. Shares issued pursuant to this Plan may be in whole
or in part, as the Board of Directors of the Corporation (the
"Board of Directors") shall from time to time determine,
authorized but unissued shares or issued shares reacquired by
the Corporation. If for any reason any shares as to which an
option has been granted cease to be subject to purchase
thereunder or any restricted shares or restricted units are
forfeited to the Corporation, or to the extent that any awards
under the Plan denominated in shares or units are paid or
settled in cash or are surrendered upon the exercise of an
option, then (unless the Plan shall have been terminated) such
shares or units, and any shares surrendered to the Corporation
upon such exercise, shall become available for subsequent
awards under the Plan; provided, however, that shares
surrendered by the Corporation upon the exercise of an
incentive stock option and shares subject to an incentive
stock option surrendered upon the exercise of a right shall
not be available for subsequent award of additional stock
options under the Plan.
f. No incentive stock option shall be granted hereunder after
April 25, 2005.
3. Administration.
a. The Plan shall be administered by the Compensation Committee
or any successor thereto of the Board of Directors of the
Corporation or by such other committee (the "Committee") as
determined by the Board. The Committee shall consist of not
less than two members of the Board of Directors each of whom
shall qualify as a "disinterested person" to administer the
Plan as contemplated by Rule 16b-3, as amended, or other
applicable rules under Section 16(b) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
b. The Committee shall have plenary authority in its sole
discretion, subject to and not inconsistent with the express
provisions of this Plan:
(1) to grant options, to determine the purchase price of the
Common Stock covered by each option, the term of each
option, the employees to whom, and the time or times at
which, options shall be granted and the number of shares to
be covered by each option;
(2) to designate options as incentive stock options or
non-qualified options and to determine which options shall
be accompanied by rights;
(3) to grant rights and to determine the purchase price of
the Common Stock covered by each right or related option,
the term of each right or related option, the Employees (as
defined herein) to whom, and the time or times at which,
rights or related options shall be granted and the number of
shares to be covered by each right or related option;
(4) to grant restricted shares and restricted units and to
determine the term of the Restricted Period (as defined in
paragraph 10.) and other conditions applicable to such
shares or units, the Employees to whom, and the time or
times at which, restricted shares or restricted units shall
be granted and the number of shares or units to be covered
by each grant;
(5) to interpret the Plan;
(6) to prescribe, amend and rescind rules and regulations
relating to the Plan;
(7) to determine the terms and provisions of the option and
rights agreements (which need not be identical) and the
restricted share and restricted unit agreements (which need
not be identical) entered into in connection with awards
under the Plan;
and to make all other determinations deemed necessary or
advisable for the administration of the Plan.
Without limiting the foregoing, the Committee shall have
plenary authority in its sole discretion, subject to, and not
inconsistent with, the express provisions of the Plan, to:
(1) select Tracor Officers and Employees for participation
in the Plan,
(2) determine the timing, price, and amount of any grant or
award under the Plan to any Employee, and
(3) either
(a) determine the form in which payment of any right
granted or awarded under the Plan will be made (i.e.,
cash, securities, or any combination thereof), or
(b) approve the election of the Employee to receive cash
in whole or in part in settlement of any right granted or
awarded under the Plan.
As used herein, the term "Tracor Officer" shall mean an
officer (other than an assistant officer) of the Corporation
or one of its principal subsidiaries, and any other person who
may from time to time be designated an executive officer of
the Corporation by its Board of Directors. "Employee" shall
mean an employee of the Corporation or one of its principal
subsidiaries. The term "subsidiary" means any corporation one
hundred percent (100%) of the common stock of which is owned,
directly or indirectly, by the Corporation.
c. The Committee may delegate to one or more of its members or
to one or more agents such administrative duties as it may
deem advisable, and the Committee or any person to whom it has
delegated duties as aforesaid may employ one or more persons
to render advice with respect to any responsibility the
Committee or such person may have under the Plan; provided,
that the Committee may not delegate any duties to a member of
the Board of Directors who, if elected to serve on the
Committee, would not qualify as a "disinterested person" to
administer the Plan as contemplated by Rule 16b-3, as amended,
or other applicable rules under the Exchange Act. The
Committee may employ attorneys, consultants, accountants, or
other persons and the Committee, the Corporation, and its
officers and directors shall be entitled to rely upon the
advice, opinions or valuations of any such persons. All
actions taken and all interpretations and determinations made
by the Committee in good faith shall be final and binding upon
all Employees who have received awards, the Corporation and
all other interested persons. No member or agent of the
Committee shall be personally liable for any action,
determination, or interpretation made in good faith with
respect to the Plan or awards made thereunder, and all members
and agents of the Committee shall be fully protected by the
Corporation in respect of any such action, determination, or
interpretation.
4. Eligibility; Factors to be Considered in Making Awards.
a. Only Employees and Outside Directors may receive awards
under the Plan. An Outside Director is any director of the
Company who is not an Employee or Officer of the Company or
any subsidiary. Outside Directors may only receive awards
under the provisions of paragraph 4.e.-4.g.
b. In determining the Employees to whom awards shall be granted
and the number of shares or units to be covered by each award,
the Committee shall take into account the nature of the
Employee's duties, his or her present and potential
contributions to the success of the Corporation and such other
factors as it shall deem relevant in connection with
accomplishing the purposes of the Plan.
c. Awards may be granted singly, in combination, or in tandem
and may be made in combination or in tandem with or in
replacement of, or as alternatives to, awards or grants under
any other employee plan maintained by the Corporation or its
subsidiaries. An award made in the form of an option, a unit
or a right may provide, in the discretion of the committee,
for
(1) the crediting to the account of, or the current payment
to, each Employee who has such an award of an amount equal
to the cash dividends and stock dividends paid by the
Corporation upon one share of Common Stock for each
restricted unit, or share of Common Stock subject to an
option or right, included in such award ("Dividend
Equivalents"), or
(2) the deemed reinvestment of such Dividend Equivalents and
stock dividends in shares of Common Stock, which deemed
reinvestment shall be deemed to be made in accordance with
the provisions of paragraph 10. and credited to the
Employee's account ("Additional Deemed Shares").
Such Additional Deemed Shares shall be subject to the same
restrictions (including but not limited to provisions
regarding forfeitures) applicable with respect to the option,
unit, or right with respect to which such credit is made.
Dividend Equivalents not deemed reinvested as stock dividends
shall not be subject to forfeiture, and may bear amounts
equivalent to interest or cash dividends as the Committee may
determine. An Employee who has been granted incentive stock
options under the Plan may be granted an additional award or
awards, subject to such limitations as may be imposed by the
Code with respect to incentive stock options.
d. The Committee, in its sole discretion, may grant to an
Employee who has been granted an award under the Plan or any
other employee plan maintained by the Corporation, one of its
subsidiaries, or any successor thereto, in exchange for the
surrender and cancellation of such award, a new award in the
same or a different form and containing such terms, including,
without limitation, a price which is different (either higher
or lower) than any price provided in the award so surrendered
and cancelled, as the Committee may deem appropriate.
e. Effective April 24, 1996, each Outside Director shall
receive a grant of one thousand (1,000) restricted shares of
the Common Stock of the Company and options to purchase two
thousand (2,000) shares of the Company. Thereafter, on
January 1st of each and every year, each Outside Director then
serving as a Director shall receive a grant of one thousand
(1,000) restricted shares of the Common Stock of the Company
("Director Grants") and options to purchase two thousand
(2,000) shares of the Common Stock of the Company ("Director
Options"). All awards of Director Grants and Director Options
are made pursuant to the procedures and conditions set forth
in paragraph 10b.(1) of this Plan.
f. The Restricted Period (as defined) in Paragraph 10a., shall
be deemed to be six (6) months from the date of the Director
Grant. The Director Options will not be exercisable for a
period of not less than six (6) months from the date of the
award, . All other terms and conditions for the award of
Restricted Shares and Director Options set forth herein shall
apply to Director Grants or Director Options. As necessary to
carry out the intent of this provision, and when required to
give meaning to the specific term or conditions when applied
to Director Grants or Director Options, the terms Employee and
Tracor Officer, when used in this Plan, shall be deemed to
also include the term Outside Director.
g. All Grants or Options shall be issued subject to the
availability of the necessary number of shares of stock being
authorized and available under the Plan at the time of Grant
or Option.
5. Option Price.
a. The purchase price of the Common Stock covered by each
option shall be determined by the Committee; provided,
however, that in the case of incentive stock options, the
purchase price shall not be less than 100% of the fair market
value of the Common Stock on the date the option is granted.
Fair market value shall mean
(1) if the Common Stock is duly listed on the National
Association of Securities Dealers Automatic Quotation System
("NASDAQ"), the closing price of the Common Stock for the
date on which the option is granted, or, if there are no
sales on such date, on the next preceding day on which there
were sales, or
(2) if the Common Stock is not duly listed on NASDAQ, the
fair market value of the Common Stock for the date on which
the option is granted, as determined by the Committee in
good faith. Such price shall be subject to adjustment as
provided in paragraph 13.
The price so determined shall also be applicable in connection
with the exercise of any related right.
b. The purchase price of the shares as to which an option is
exercised shall be paid in full at the time of exercise;
payment may be made in cash, which may be paid by check or
other instrument acceptable to the Corporation, in shares of
the Common Stock, valued at the closing price of the Common
Stock as reported on NASDAQ for the date of exercise, or if
there were no sales on such date, on the next preceding day on
which there were sales (or, if the Common Stock is not duly
listed on NASDAQ, the fair market value of the Common Stock on
the date of exercise, as determined by the Committee in good
faith), or, if permitted by the Committee and subject to such
terms and conditions as it may determine, by surrender of
outstanding awards under the Plan. In addition, the Employee
shall pay any amount necessary to satisfy applicable federal,
state, or local tax requirements promptly upon notification of
the amount due. The Committee may permit such amount to be
paid in shares of Common Stock previously owned by the
Employee, or a portion of the shares of Common Stock that
otherwise would be distributed to such Employee upon exercise
of the option, or a combination of cash and shares of such
Common Stock.
6. Term of Options. The term of each incentive stock option
granted under the Plan shall be such period of time as the
Committee shall determine, but not more than ten years from the
date of grant, subject to earlier termination as provided in
paragraphs 11. and 12. The term of each non-qualified stock
option granted under the Plan shall be such period of time as the
Committee shall determine, subject to earlier termination as
provided in paragraphs 11. and 12.
7. Exercise of Options.
a. Each option shall become exercisable, in whole or in part,
as the Committee shall determine, provided, however, that the
Committee may also, in its discretion, accelerate the
exercisability of any option in whole or in part at any time.
b. Subject to the provisions of the Plan and unless otherwise
provided in the option agreement, an option granted under the
Plan shall become exercisable in full at the earliest of the
Employee's death, Eligible Retirement (as defined below), Total
Disability, or a Change in Control (as defined in
paragraph 12.). For purposes of this Plan, the term "Eligible
Retirement" shall mean the date upon which an Employee, having
attained an age of not less than sixty-two, terminates his
employment with the Corporation or a subsidiary, provided that
such Employee has been employed by the Corporation, or one of
its subsidiaries, or a combination thereof for a period of not
less than five (5) years prior to such termination.
c. An option may be exercised, at any time or from time to
time (subject, in the case of an incentive stock option, to such
restrictions as may be imposed by the Code), as to any or all
full shares as to which the option has become exercisable,
provided, however, that an option may not be exercised at any
one time as to less than 100 shares for less than the number of
shares as to which the option is then exercisable, if that
number is less than 100 shares).
d. Subject to the provisions of paragraphs 11. and 12., in the
case of incentive stock options, no option may be exercised at
any time unless the holder thereof is then an Employee of the
Corporation or one of its subsidiaries. For purposes of this
subparagraph 7.d., the term "subsidiary" shall include, as under
Example (3) of Treasury Regulations Section 1.421-7(h) (3) and
(4), any corporation which is a subsidiary of the Corporation
during the entire portion of the requisite period of employment
during which it is the employer of the holder.
e. Upon the exercise of an option or portion thereof in
accordance with the Plan, the option agreement and such rules
and regulations as may be established by the Committee, the
holder thereof shall have the rights of a shareholder with
respect to the shares issued as a result of such exercise.
8. Award and Exercise of Rights.
a. A right may be awarded by the Committee in connection with any
option granted under the Plan, either at the time the option is
granted or thereafter at any time prior to the exercise,
termination or expiration of the option ("tandem right"), or
separately ("freestanding right"). Each tandem right shall be
subject to the same terms and conditions as the related option
and shall be exercisable only to the extent the option is
exercisable. No right shall be exercisable for cash by a Tracor
Officer within six months from the date the right is awarded (and
then, as to a tandem right, only to the extent the related option
is exercisable) or, if the exercise price of the right is not
fixed on the date of the award, within six months from the date
when the exercise price is so fixed, and in any case only when
the Tracor Officer's election to receive cash in full or partial
satisfaction of the right, as well as the Tracor Officer's
exercise of the right for cash, is made during a Quarterly Window
Period (as defined below); provided, that a right may be
exercised by a Tracor Officer for cash outside a Quarterly Window
Period if the date of exercise is automatic or has been fixed in
advance under the Plan and is outside the Tracor Officer's
control. The term "Quarterly Window Period" shall mean the
period beginning on the third business day following the date of
release of each of the Corporation's quarterly and annual summary
statements of sales and earnings and ending on the twelfth
business day following such release; and the date of any such
release shall be deemed to be the date it either:
(1) appears on a wire service,
(2) appears on a financial news service,
(3) appears in a newspaper of general circulation, or
(4) is otherwise made publicly available, for example, by
press releases to a wire service, financial news service, or
newspapers or general circulation.
b. A right shall entitle the Employee upon exercise in
accordance with its terms (subject, in the case of a tandem
right, to the surrender unexercised of the related option or
any portion or portions thereof which the Employee from time
to time determines to surrender for this purpose) to receive,
subject to the provisions of the Plan and such rules and
regulations as from time to time may be established by the
Committee, a payment having an aggregate value equal to the
product of
(1) the excess of
(a) the fair market value on the exercise date of one
share of Common Stock over
(b) the exercise price per share, in the case of a tandem
right, or the price per share specified in the terms of
the right, in the case of a freestanding right,
multiplied by
(2) the number of shares with respect to which the right
shall have been exercised.
The payment may be made in the form of all cash, all shares of
Common Stock, or a combination thereof, as elected by the
Employee, subject (where the Employee is a Tracor Officer) to
paragraph 8.a. hereof.
c. The exercise price per share specified in a right shall be
as determined by the Committee, provided that, in the case of
a tandem right accompanying an incentive stock option, the
exercise price shall be not less than fair market value of the
Common Stock subject to such option on the date of grant.
d. If upon the exercise of a right the Employee is to receive a
portion of the payment in shares of Common Stock, the number
of shares shall be determined by dividing such portion by the
fair market value of a share on the exercise date. The number
of shares received may not exceed the number of shares covered
by any option or portion thereof surrendered. Cash will be
paid in lieu of any fractional share.
e. No payment will be required from an Employee upon exercise
of a right, except that any amount necessary to satisfy
applicable federal, state, or local tax requirements shall be
withheld or paid promptly by the Employee upon notification of
the amount due and prior to or concurrently with delivery of
cash or a certificate representing shares. The Committee may
permit such amount to be paid in shares of Common Stock
previously owned by the Employee, or a portion of the shares
of Common Stock that otherwise would be distributed to such
Employee upon exercise of the right, or a combination of cash
and shares of such Common Stock.
f. The fair market value of a share shall mean the closing
price of the Common Stock as reported on NASDAQ for the date
of exercise, or if there are no sales on such date, on the
next preceding day on which there were sales; provided,
however, that in the case of rights that relate to an
incentive stock option, the Committee may prescribe, by rules
of general application, such other measure of fair market
value as the Committee may in its discretion determine but not
in excess of the maximum amount that would be permissible
under Section 422 of the Code without disqualifying such
option under Section 422.
g. Upon exercise of a tandem right, the number of shares
subject to exercise under the related option shall
automatically be reduced by the number of shares represented
by the option or portion thereof surrendered.
h. A right related to an incentive stock option may only be
exercised if the fair market value of a share of Common Stock
on the exercise date exceeds the option price.
9. Non-Transferability of Options, Rights, and Units; Holding
Periods for Tracor Officers.
a. Options, rights, and units granted under the Plan shall not
be transferable by the grantee thereof otherwise than by will
or the laws of descent and distribution; provided, however,
that
(1) the designation of a beneficiary by an Employee shall
not constitute a transfer, and
(2) options and rights may be exercised during the lifetime
of the Employee only by the Employee or, unless such
exercise would disqualify an option as an incentive stock
option, by the Employee's guardian or legal representative.
b. Notwithstanding anything contained in this Plan to the
contrary,
(1) any shares of Common Stock awarded hereunder to a Tracor
Officer may not be transferred or disposed of for at least
six months from the date of award thereof,
(2) any option, right, or unit awarded hereunder to a Tracor
Officer, or the shares of Common Stock into which any such
option, right or unit is exercised or converted, may not be
transferred or disposed of for at least six months following
the date of acquisition by the Tracor Officer of such
option, right, or unit, and
(3) the Committee shall take no action whose effect would
cause a Tracor Officer to be in violation of clause (1) or
(2) above.
10. Award and Delivery of Restricted Shares or Restricted Units.
a. At the time an award of restricted shares or restricted
units is made, the Committee shall establish a period of time
(the "Restricted Period") applicable to such award. Each
award of restricted shares or restricted units may have a
different Restricted Period. The Committee may, in its sole
discretion, at the time an award is made, prescribe conditions
for the incremental lapse of restrictions during the
Restricted Period and for the lapse or termination of
restrictions upon the satisfaction of other conditions in
addition to or other than the expiration of the Restricted
Period with respect to all or any portion of the restricted
shares or restricted units. Subject to paragraph 9. hereof,
the Committee may also, in its sole discretion, shorten, or
terminate the Restricted Period, or waive any conditions for
the lapse or termination of restrictions with respect to all
or any portion of the restricted shares or restricted units.
Notwithstanding the foregoing but subject to paragraph 9.
hereof, all restrictions shall lapse or terminate with respect
to all restricted shares or restricted units upon the earliest
to occur of an Employee's Eligible Retirement, a Change in
Control, death, or Total Disability.
b.
(1) Unless such shares are issued as uncertificated shares
pursuant to subparagraph (2)(a) below, a stock certificate
representing the number of restricted shares granted to an
Employee shall be registered in the Employee's name but
shall be held in custody by the Corporation or an agent
therefor for the Employee's account. The Employee shall
generally have the rights and privileges of a shareholder as
to such restricted shares, including the right to vote such
restricted shares, except that, subject to the provisions of
paragraphs 11. and 12., the following restrictions shall
apply:
(a) the Employee shall not be entitled to delivery of the
certificate until the expiration or termination of the
Restricted Period and the satisfaction of any other
conditions prescribed by the Committee;
(b) none of the restricted shares may be sold,
transferred, assigned, pledged, or otherwise encumbered
or disposed of during the Restricted Period and until the
satisfaction of any other conditions prescribed by the
Committee; and
(c) all of the restricted shares shall be forfeited and
all rights of the Employee to such restricted shares
shall terminate without further obligation on the part of
the Corporation unless the Employee has remained an
Employee of the Corporation or any of its subsidiaries
until the expiration or termination of the Restricted
Period and the satisfaction of any other conditions
prescribed by the Committee applicable to such restricted
shares. At the discretion of the Committee,
i) cash and stock dividends with respect to the restricted
shares may be either currently paid or withheld by the
Corporation for the Employee's account, and interest may
be paid on the amount of cash dividends withheld at a
rate and subject to such terms as determined by the
Committee or
ii) the Committee may require that all cash dividends
be applied to the purchase of additional shares of
Common Stock, and such purchased shares, together with
any stock dividends related to such restricted shares
(such purchased shares and stock dividends are
hereafter referred to as "Additional Restricted
Shares") shall be treated as Additional Shares, subject
to forfeiture on the same terms and conditions as the
original grant of the restricted shares to the
Employee.
(2) The purchase of any such Additional Restricted Shares
shall be made either
(a) through a dividend reinvestment plan that may be
established by the Corporation which satisfies the
requirements of Rule 16b-2 under the Exchange Act, in
which event the price of such shares so purchased through
the reinvestment of dividends shall be as determined in
accordance with the provisions of that plan and no stock
certificate representing such Additional Restricted
Shares shall be in the Employee's name, or
(b) in accordance with such alternative procedure as is
determined by the Committee in which event the price of
such purchased shares shall be
i) if the Common Stock is duly listed on NASDAQ, the
closing price of the Common Stock as reported on NASDAQ
for the date on which such purchase is made, or if
there were no sales on such date, the next preceding
day on which there were sales, or
ii) if the Common Stock is not duly listed on NASDAQ,
the fair market value of the Common Stock for the date
on which such purchase is made, as determined by the
Committee in good faith. In the event that the
Committee shall not require reinvestment, cash, or
stock dividends so withheld by the Committee shall not
be subject to forfeiture. Upon the forfeiture of any
restricted shares (including any Additional Restricted
Shares), such forfeited shares shall be transferred to
the Corporation without further action by the Employee.
The Employee shall have the same rights and privileges,
and be subject to the same restrictions, with respect
to any shares received pursuant to paragraph 13.
c. Upon the expiration or termination of the Restricted Period
and the satisfaction of any other conditions prescribed by the
Committee or at such earlier time as provided for in
paragraphs 11. and 12., the restrictions applicable to the
restricted shares (including Additional Restricted Shares)
shall lapse and a stock certificate for the number of
restricted shares (including any Additional Restricted Shares)
with respect to which the restrictions have lapsed shall be
delivered, free of all such restrictions, except any that may
be imposed by law, to the Employee or the Employee's
beneficiary or estate, as the case may be. The Corporation
shall not be required to deliver any fractional share of
Common Stock but will pay, in lieu thereof, the fair market
value (determined as of the date the restrictions lapse) of
such fractional share to the Employee or the Employee's
beneficiary or estate, as the case may be. No payment will be
required from the Employee upon the issuance or delivery of
any restricted shares, except that any amount necessary to
satisfy applicable federal, state, or local tax requirements
shall be withheld or paid promptly upon notification of the
amount due and prior to or concurrently with the issuance or
delivery of a certificate representing such shares. The
Committee may permit such amount to be paid in shares of
Common Stock previously owned by the Employee, or a portion of
the shares of Common Stock that otherwise would be distributed
to such Employee upon the lapse of the restrictions applicable
to the restricted shares, or a combination of cash and shares
of such Common Stock.
d. In the case of an award of restricted units, no shares of
Common Stock shall be issued at the time the award is made,
and the Corporation shall not be required to set aside a fund
for the payment of any such award.
e.
(1) Upon the expiration or termination of the Restricted
Period and the satisfaction of any other conditions
prescribed by the Committee or at such earlier time as
provided in paragraphs 11. and 12., the Corporation shall
deliver to the Employee or the Employee's beneficiary or
estate, as the case may be, one share of Common Stock for
each restricted unit with respect to which the restrictions
have lapsed ("vested unit").
(2) In addition, if the Committee has not required the
deemed reinvestment of such Dividend Equivalents pursuant to
paragraph 4., at such time the Corporation shall deliver to
the Employee cash equal to any Dividend Equivalents or stock
dividends credited with respect to each such vested unit
and, to the extent determined by the Committee, the interest
thereupon. However, if the Committee has required such
deemed reinvestment in connection with such restricted unit,
in addition to the stock represented by such vested unit,
the Corporation shall deliver the number of Additional
Deemed Shares credited to the Employee with respect to such
vested unit.
(3) Notwithstanding the foregoing, the Committee may, in its
sole discretion, elect to pay cash or part cash and part
Common Stock in lieu of delivering only Common Stock for the
vested units and related Additional Deemed Shares. If a
cash payment is made in lieu of delivering Common Stock, the
amount of such cash payment shall be equal to
(a) if the Common Stock is duly listed on NASDAQ, the
closing price of the Common Stock as reported on NASDAQ
for the date on which the Restricted Period lapsed with
respect to such vested unit and related Additional Deemed
Shares (the "Lapse Date") or, if there are no sales on
such date, on the next preceding day on which there were
sales, or
(b) if the Common Stock is not duly listed on NASDAQ, the
fair market value of the Common Stock for the Lapse Date,
as determined by the Committee in good faith.
f. No payment will be required from the Employee upon the award
of any restricted units, the crediting or payment of any
Dividend Equivalents or Additional Deemed Shares, or the
delivery of Common Stock or the payment of cash in respect of
vested units, except that any amount necessary to satisfy
applicable federal, state, or local tax requirements shall be
withheld or paid promptly upon notification of the amount due.
The Committee may permit such amount to be paid in shares of
Common Stock previously owned by the Employee, or a portion of
the shares of Common Stock that otherwise would be distributed
to such Employee in respect of vested units and Additional
Deemed Shares, or a combination of cash and shares of such
Common Stock.
g. In addition, the Committee shall have the right, in its
absolute discretion, upon the vesting of any restricted shares
(including Additional Restricted Shares) and restricted units
(including Additional Deemed Shares) to award cash
compensation to the Employee for the purpose of aiding the
Employee in the payment of any and all federal, state, and
local income taxes payable as a result of such vesting, if the
performance of the Corporation during the Restricted Period
meets such criteria as then or theretofore determined by the
Committee.
11. Termination of Employment. In the event that the
employment of an Employee to whom an option or right has been
granted under the Plan shall be terminated for any reason
other than as set forth in paragraph 12., such option or right
may, subject to the provisions of the Plan, be exercised (but
only to the extent that the Employee was entitled to do so at
the termination of his employment) at any time within three
(3) months after such termination, but in no case later than
the date on which the option or right terminates.
Unless otherwise determined by the Committee, if an Employee to
whom restricted shares or restricted units have been granted
ceases to be an Employee of the Corporation or of a subsidiary,
for any reason other than as set forth in paragraph 12., prior to
the end of the Restricted Period and the satisfaction of any
other conditions prescribed by the Committee, the Employee shall
immediately forfeit all restricted shares and restricted units,
including all Additional Restricted Shares or Additional Deemed
Shares related thereto.
Any option, right, restricted share or restricted unit agreement,
or any rules and regulations relating to the Plan, may contain
such provisions as the Committee shall approve with reference to
the determination of the date employment terminates and the
effect of leaves of absence. Any such rules and regulations with
reference to any option agreement shall be consistent with the
provisions of the Code and any applicable rules and regulations
thereunder. Nothing in the Plan or in any award granted pursuant
to the Plan shall confer upon any Employee any right to continue
in the employ of the Corporation of any of its subsidiaries or
interfere in any way with the right of the Corporation or any
such subsidiary to terminate such employment at any time.
12. Eligible Retirement, Death, or Total Disability of Employee,
Change in Control. If any Employee to whom an option, right,
restricted share, or restricted unit has been granted under the
Plan shall die or suffer a Total Disability while employed by the
Corporation or one of its subsidiaries, if an Employee terminates
his employment pursuant to an Eligible Retirement, of if a Change
in Control should occur, such option or right may be exercised as
set forth herein, or such restricted shares or restricted unit
shall be deemed to be vested, whether or not the Employee was
otherwise entitled at such time to exercise such option or right,
or be treated as vested in such share or unit. Subject to the
restrictions otherwise set forth in this Plan, such option or
right shall be exercisable by the Employee, a legatee or legatees
of the Employee under the Employee's last will, or by the
Employee's personal representatives or distributees, whichever is
applicable, at the earlier of
a. the date on which the option or right terminates in accordance
with the terms of grant, or
b. any time prior to the expiration of three months after the
date of such Employee's Eligible Retirement, his termination
due to total disability, or the occurrence of a Change in
Control, or, if applicable, within one year of such Employee's
death.
For purposes of this paragraph 12., "Total Disability" is
defined as the permanent inability of an Employee, as a result of
accident or sickness, to perform any and every duty pertaining to
such Employee's occupation or employment for which the Employee
is suited by reason of the Employee's previous training,
education, and experience.
A "Change in Control" shall be deemed to have occurred upon:
a. a business combination, including a merger or
consolidation, of the Company and the shareholders of the
Company prior to the combination do not continue to own,
directly or indirectly, more than fifty-one percent (51%) of
the equity of the combined entity;
b. a sale, transfer, or other disposition in one or more
transactions (other than in transactions in the ordinary
course of business or in the nature of a financing) of the
assets or earning power aggregating more than forty-five
percent (45%) of the assets or operating revenues of the
Company and its subsidiaries, taken as a whole, to any person
or affiliated or associated group of persons (as defined by
Rule 12b-2 of the Exchange Act in effect as of the date
hereof);
c. the liquidation of the Company;
d. one or more transactions which result in the acquisition by
any person or associated or affiliated group of persons (other
than the Company, any subsidiary or any employee benefit plan
whose beneficiaries are employees of the Company) of the
beneficial ownership (as defined in Rule 13d-3 of the Exchange
Act, in effect as of the date hereof) of forty percent (40%)
or more of the common stock of the Company, or securities
representing forty percent (40%) or more of the combined
voting power of the voting securities of the Company which
affiliated persons owned less than forty percent (40%) prior
to such transaction or transactions; or
e. the election or appointment, within a twelve month period,
of any person or affiliated or associated group, or its or
their nominees, to the Board of Directors of the Company, such
that such persons or nominees, when elected, constitute a
majority of the Board of Directors of the Company and whose
appointment or election was not approved by a majority of
those persons who were directors at the beginning of such
period or whose election or appointment was made at the
request of an Acquiring Person.
An "Acquiring Person" is any person who, or which, together with
all affiliates or associates of such person, is the beneficial
owner of twenty percent (20%) or more of the common stock of the
Company then outstanding, except that an Acquiring Person does
not include the Company, any wholly owned subsidiary of the
Company, or any employee benefit plan of the Company or of a
subsidiary of the Company or any person holding common stock of
the Company for or pursuant to such plan. For the purpose of
determining who is an Acquiring Person, the percentage of the
outstanding shares of the Common stock of which a person is a
beneficial owner shall be calculated in accordance with Rule
13d - e.
13. Adjustments Upon Changes in Capitalization, etc.
Notwithstanding any other provision of the Plan, the Committee
may at any time make or provide for such adjustments to the Plan,
to the number and class of shares available thereunder or to any
outstanding options, restricted shares, or restricted units as it
shall deem appropriate to prevent dilution or enlargement of
rights, including adjustments in the event of distributions to
holders of Common Stock other than a normal cash dividend,
changes in the outstanding Common Stock by reason of stock
dividends, split-ups, recapitalizations, mergers, consolidations,
combinations, or exchanges of shares, separations,
reorganizations, liquidations, and the like. In the event of any
offer to holders of Common Stock generally relating to the
acquisition of their shares, the Committee may make such
adjustment as it deems equitable in respect of outstanding
options, rights, and restricted units including in the
Committee's discretion revision of outstanding options, rights,
and restricted units so that they may be exercisable for or
payable in the consideration payable in the acquisition
transaction. Any such determination by the Committee shall be
conclusive. No adjustment shall be made in the minimum number of
shares with respect to which an option may be exercised at any
time. Any fractional shares resulting from such adjustments to
options, rights, limited rights, or restricted units shall be
eliminated.
14. Effective Date. The Plan as theretofore amended shall become
effective as of December 27, 1991, provided that the Plan shall
have been approved by Corporation's stockholders in connection
with the consummation of the Joint Defense Plans of
Reorganization of Tracor Holdings, Inc., et al., Jointly
Administered Case No. 91-10572LK in the United States Bankruptcy
Court for the Western District of Texas. The Committee may, in
its discretion, grant awards under the Plan, the grant, exercise,
or payment of which shall be expressly subject to the conditions
that, to the extent required at the time of grant, exercise, or
payment,
a. the shares of Common Stock covered by such awards shall be
duly listed, upon official notice of issuance, upon NASDAQ,
and
b. if the Corporation deems it necessary or desirable, a
Registration Statement under the Securities Act of 1933 with
respect to such shares shall be effective.
15. Termination and Amendment. The Board of Directors of the
Corporation may suspend, terminate, modify, or amend the Plan,
provided that if any such amendment requires shareholder approval
to meet the requirement of the then applicable rules under
Section 16(b) of the Exchange Act, such amendment shall be
subject to the approval of the Corporation's stockholders. If the
Plan is terminated, the terms of the Plan shall, notwithstanding
such termination, continue to apply to awards granted prior to
such termination. In addition, no suspension, termination,
modification, or amendment of the Plan may, without the consent
of the Employee to whom an award shall theretofore have been
granted, adversely affect the rights of such Employee under such
award.
16. Written Agreements. Each award of options, rights,
restricted shares, or restricted units shall be evidenced by a
written agreement, executed by the Employee and the Corporation,
which shall contain such restrictions, terms and conditions as
the Committee may require.
17. Effect on Other Stock Plans. The adoption of the Plan shall
have no effect on awards made, or to be made, pursuant to other
stock plans covering Employees of the Corporation, its
subsidiaries, or any successors thereto.
Tracor, Inc. Proxy This Proxy is Solicited on Behalf
6500 Tracor Lane of the Board of Directors. The
Austin, Texas 78725-2000 undersigned hereby appoints James
512/926-2800 B. Skaggs and Russell E. Painton,
as Proxies, each with the power
to appoint his substitute and
hereby authorizes them to represent
and to vote, as designated below,
all the shares of common stock
of Tracor, Inc., held of record
by the undersigned on Friday,
March 7, 1997, at the Annual Meeting
of Shareholders to be held at
10:00 a.m., April 22, 1997, Tracor,
Inc., 6500 Tracor Lane, Austin,
Texas, and at any adjournments
thereof as follows:
1. Election of Directors [ ] FOR all nominees listed below
[ ] WITHHOLD authority
(except as marked to the contrary below) to vote for all
nominees listed below
W. Conway, B. Marbut
(INSTRUCTION: To withhold authority to vote for any individual
nominee, write that nominee's name on the space provided below.)
-----------------------------------------------------------------------
2. Proposal to amend the 1995 Stock Plan for Employees of Tracor,
Inc. and its Subsidiaries to increase the number of shares to be
issued under the plan from 1,000,000 to 2,000,000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Proposal to ratify the selection of Ernst & Young, LLP as the
Company's independent auditors for 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
With discretionary authority to vote on any other matter incident
to the conduct of the meeting or matters with respect to which
the Board of Directors has no knowledge, and which may properly
come before the meeting.
This Proxy when properly executed will be voted in the manner
directed herein by the undersigned shareholder. If no direction
is made, this proxy will be voted FOR proposals 1, 2, and 3, and
the discretionary authority set forth in proposal will be deemed
to be given.
Dated: ___________, 1997
___________________________
Signature
___________________________
Printed Name
___________________________
Signature, if held jointly
___________________________
Printed Name
(Joint owners should EACH
sign. Please sign EXACTLY as
your name(s) appear(s) on this
card. When signing as
attorney, trustee, executor,
administrator, guardian, or
corporate officer, please give
your FULL title.)
[ ] I plan to attend the meeting on
April 22, 1997.
