SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934 (Amendment No. ____)
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement / /Confidential for Use of the Commission Only
/ / Definitive Proxy Statement (as permitted by Rule 14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
TECHNE CORPORATION
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1) or
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3)
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing:
1) Amount Previously Paid:
--------------------------------------------------
2) Form, Schedule or Registration Statement No.:
----------------------------
3) Filing Party:
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4) Date Filed:
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<PAGE>
TECHNE CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
to be held
October 19, 1995
The annual meeting of shareholders of Techne Corporation will be held
at the Sheraton Minneapolis Metrodome Hotel, 1330 Industrial Boulevard at 35W
North, Minneapolis, Minnesota, on Thursday, October 19, 1995, at 3:30 p.m.
(Minneapolis Time), for the following purposes:
1. To set the number of members of the Board of Directors at six (6).
2. To elect directors of the Company for the ensuing year.
3. To approve certain current and future grants of options to outside
directors of the Company under the Company's 1988 Nonqualified Stock
Option Plan and to approve the reservation of 200,000 additional
shares for issuance to employees, officers, directors, consultants and
others under such Plan.
4. To take action upon any other business that may properly come before
the meeting or any adjournment thereof.
Only shareholders of record shown on the books of the Company at the
close of business on September 8, 1995, will be entitled to vote at the meeting
or any adjournment thereof. Each shareholder is entitled to one vote per share
on all matters to be voted on at the meeting.
You are cordially invited to attend the meeting. Whether or not you
plan to attend the meeting, please sign, date and return your Proxy in the
return envelope provided as soon as possible. Your cooperation in promptly
signing and returning the Proxy will help avoid further solicitation expense to
the Company.
This Notice, the Proxy Statement and the enclosed Proxy are sent to you
by order of the Board of Directors.
THOMAS E. OLAND,
President
Dated: September 20, 1995
Minneapolis, Minnesota
<PAGE>
TECHNE CORPORATION
PROXY STATEMENT
for
Annual Meeting of Shareholders
to be held October 19, 1995
INTRODUCTION
Your Proxy is solicited by the Board of Directors of Techne Corporation
(the "Company") for use at the Annual Meeting of Shareholders to be held on
October 19, 1995, and at any adjournment thereof, for the purposes set forth in
the attached Notice of Annual Meeting.
The cost of soliciting Proxies, including preparing, assembling and
mailing the Proxies and soliciting material, will be borne by the Company.
Directors, officers and regular employees of the Company may, without
compensation other than their regular compensation, solicit Proxies personally
or by telephone.
Any shareholder giving a Proxy may revoke it at any time prior to its
use at the meeting by giving written notice of such revocation to the Secretary
or other officer of the Company or by filing a new written Proxy with an officer
of the Company. Personal attendance at the meeting is not, by itself, sufficient
to revoke a Proxy unless written notice of the revocation or a subsequent Proxy
is delivered to an officer before the revoked or superseded Proxy is used at the
meeting.
Proxies not revoked will be voted in accordance with the choice
specified by shareholders by means of the ballot provided on the Proxy for that
purpose. Proxies which are signed but which lack any such specification will,
subject to the following, be voted in favor of the proposals set forth in the
Notice of Meeting and in favor of the number and slate of directors proposed by
the Board of Directors and listed herein. If a shareholder abstains from voting
as to any matter, then the shares held by such shareholder shall be deemed
present at the meeting for purposes of determining a quorum and for purposes of
calculating the vote with respect to such matter, but shall not be deemed to
have been voted in favor of such matter. Abstentions, therefore, as to any
proposal will have the same effect as votes against such proposal. If a broker
returns a "non-vote" proxy, indicating a lack of voting instruction by the
beneficial holder of the shares and a lack of discretionary authority on the
part of the broker to vote on a particular matter, then the shares covered by
such non-vote shall be deemed present at the meeting for purposes of determining
a quorum but shall not be deemed to be represented at the meeting for purposes
of calculating the vote required for approval of such matter.
The mailing address of the Company's principal executive office is 614
McKinley Place N.E., Minneapolis, Minnesota 55413. The Company expects that this
Proxy Statement and the
<PAGE>
related Proxy and Notice of Annual Meeting will first be mailed to shareholders
on or about September 20, 1995.
OUTSTANDING SHARES AND VOTING RIGHTS
The Board of Directors of the Company has fixed September 8, 1995, as
the record date for determining shareholders entitled to vote at the Annual
Meeting. Persons who were not shareholders on such date will not be allowed to
vote at the Annual Meeting. At the close of business on September 8, 1995,
9,428,201 shares of the Company's Common Stock were issued and outstanding. Such
Common Stock is the only outstanding class of stock of the Company. Each share
of Common Stock is entitled to one vote on each matter to be voted upon at the
meeting. Holders of the Common Stock are not entitled to cumulative voting
rights in the election of directors.
PRINCIPAL SHAREHOLDERS
The following table provides information concerning the only persons
known to the Company to be the beneficial owners of more than five percent (5%)
of the Company's outstanding Common Stock as of September 8, 1995:
<TABLE>
<CAPTION>
Amount and
Name and Address Nature of Shares Percent
of Beneficial Owner Beneficially Owned(1) of Class(2)
<S> <C> <C>
Kopp Investment Advisors, Inc. 1,326,640(3) 14.1%
6600 France Avenue So.
Edina, Minnesota 55435
D. F. Dent & Co. 703,884 7.5%
2 East Read St.
Baltimore, Maryland 21202
Thomas E. Oland 363,460(4)(5) 3.8%
614 McKinley Place N.E.
Minneapolis, Minnesota 55413
Roger C. Lucas 345,452(4)(6) 3.6%
41 E. Pleasant Lake Dr.
North Oaks, Minnesota 55127
Peter R. Peterson 529,140(7) 5.6%
6111 Blue Circle Drive
Minnetonka, Minnesota 55343
</TABLE>
<PAGE>
(1) Unless otherwise indicated, the person listed as the beneficial owner of
the shares has sole voting and sole investment power over the shares.
(2) Shares not outstanding but deemed beneficially owned by virtue of the right
of a person to acquire them as of September 8, 1995, or within sixty days
of such date are treated as outstanding only when determining the percent
owned by such individual and when determining the percent owned by the
group.
(3) Kopp Investment Advisors, Inc. reports voting power over 5,000 of such
shares and investment power over all such shares.
(4) Does not include 273,195 shares (2.9% of the Company's outstanding Common
Stock) held by the Company's Stock Bonus Plan ("Stock Bonus Plan"), which
are included in the group total in the Management Shareholdings table. The
Company's Board of Directors, acting by a majority vote, currently directs
the Trustee as to the voting of such shares.
(5) Includes 17,139 shares held by Thomas Oland and Associates, 51,481 shares
held by the Thomas Oland and Associates Profit Sharing Plan and Trust and
66,277 shares subject to stock options which are exercisable as of
September 8, 1995, or will become exercisable within 60 days of such date.
(6) Includes 54,813 shares subject to stock options which are exercisable as of
September 8, 1995, or will become exercisable within 60 days of such date.
(7) Does not include shares, if any, which may be held from time to time in the
trading account of Peterson Brothers Securities Company, a corporation of
which Mr. Peterson is an affiliate. Mr. Peterson disclaims beneficial
ownership of any such shares. Mr. Peterson is a former director, and was a
promoter, of the Company.
MANAGEMENT SHAREHOLDINGS
The following table sets forth the number of shares of the Company's
Common Stock beneficially owned as of September 8, 1995, by each executive
officer of the Company named in the Summary Compensation Table, by each director
who is a nominee for reelection and by all directors and executive officers
(including the named individuals) as a group:
<PAGE>
<TABLE>
<CAPTION>
Name of Director Number of Shares Percent
or Identity Group Beneficially Owned(1) of Class(2)
<S> <C> <C>
Thomas E. Oland 363,460(3) 3.8%
Roger C. Lucas 345,452(4) 3.6%
Howard V. O'Connell 60,020(5)(6) .6%
G. Arthur Herbert 56,355(5)(7) .7%
Monica Tsang 45,670(8) .5%
James A. Weatherbee 44,252(9) .5%
Randolph C. Steer, M.D. 25,000(5)(6) .3%
Thomas C. Detwiler 15,000(10) *
Lowell E. Sears 100(5) *
Officers and directors
as a group (11 persons) 1,247,504(11) 13.0%
</TABLE>
* Less than 1%
(1) See Note (1) to preceding table.
(2) See Note (2) to preceding table.
(3) See Notes (4) and (5) to preceding table.
(4) See Notes (4) and (6) to preceding table.
(5) See Note (5) to preceding table.
(6) Includes 5,000 shares subject to options which are exercisable as of
September 8, 1995 or will become exercisable within 60 days of such date.
Does not include option to purchase 5,000 shares which will become
exercisable as of the date of the Annual Meeting if approved by the
shareholders (See Proposal #3).
(7) Includes 25,000 shares subject to options which are exercisable as of
September 8, 1995 or will become exercisable within 60 days of such date.
Does not include option to purchase 5,000 shares which will become
exercisable as of the date of the Annual Meeting if approved by the
shareholders (See Proposal #3).
(8) Includes 25,000 shares subject to stock options which are exercisable as of
September 8, 1995, or will become exercisable within 60 days of such date.
Does not include the shares beneficially owned by James A. Weatherbee, Dr.
Tsang's husband.
(9) Includes 25,000 shares subject to stock options which are exercisable as of
September 8, 1995, or will become exercisable within 60 days of such date.
Does not include the shares beneficially owned by Monica Tsang, Dr.
Weatherbee's wife.
<PAGE>
(10) Includes 15,000 shares subject to options which are exercisable as of
September 8, 1995 or will become exercisable within 60 days of such date.
(11) Includes 717,219 shares held directly by officers, directors and their
associates, 273,195 shares held by the Stock Bonus Plan and 257,090 shares
which may be purchased pursuant to options which are exercisable as of
September 8, 1995 or will become exercisable within 60 days of such date.
ELECTION OF DIRECTORS
(Proposals #1 and #2)
General Information
The Bylaws of the Company provide that the number of directors shall be
determined by the shareholders at each annual meeting. The Board of Directors
recommends that the number of directors be set at six. Under applicable
Minnesota law, approval of the proposal to set the number of directors at six,
as well as the election of each nominee, requires the affirmative vote of the
holders of the greater of (1) a majority of the voting power of the shares
represented in person or by proxy at the Annual Meeting with authority to vote
on such matter or (2) a majority of the voting power of the minimum number of
shares that would constitute a quorum for the transaction of business at the
Annual Meeting.
In the election of directors, each Proxy will be voted for each of the
nominees listed below unless the Proxy withholds a vote for one or more of the
nominees. Each person elected as a director shall serve for a term of one year
or until his successor is duly elected and qualified. All of the nominees are
members of the present Board of Directors. If any of the nominees should be
unable to serve as a director by reason of death, incapacity or other unexpected
occurrence, the Proxies solicited by the Board of Directors shall be voted by
the proxy representatives for such substitute nominee as is selected by the
Board, or, in the absence of such selection, for such fewer number of directors
as results from such death, incapacity or other unexpected occurrence.
The following table provides certain information with respect to the
nominees for director.
<TABLE>
<CAPTION>
Current
Position(s) with Principal Occupation(s) Director
Name Age Company During Past Five Years Since
<S> <C> <C> <C> <C>
Thomas E. Oland 54 Chairman of the Chairman of the Board, 1985
Board, President and Treasurer of
President, the Company since
Treasurer and December 1985 and
Director President of Research and
Diagnostic Systems, Inc.
("R&D") since July 1982.
Roger C. Lucas 52 Vice Chairman Vice Chairman and Senior 1985
and Director Scientific Advisor to the
Company's Board since July
1995. Chief Scientific
Officer, Executive Vice
President and Secretary of
the Company from
December 1985 to March
1995.
Howard V. 65 Director Vice Chairman of Kinnard 1985
O'Connell Investments, Inc. and its
subsidiary, John G. Kinnard
and Company, Incorporated,
a securities broker-dealer,
since February 1990.
President of Kinnard
Investments, Inc. from
October 1979 to February
1990.
G. Arthur Herbert 69 Director Principal of CEO Advisors, 1989
a management and financial
consulting firm, since
January 1989; from January
1969 to December 1988,
President and Vice President
Manager of Electro-Science
Management Corp., a
manager of Venture Capital
Partnerships.
Randolph C. Steer, 45 Director Consultant to the 1990
M.D. pharmaceutical and
biotechnology industries
since 1989; Chairman/President
and CEO of Advanced
Therapeutics Communications
International, a division
of Physicians World
Communications, a medical
communications corporation,
from 1985 to 1989.
Director of BioCryst
Pharmaceuticals, Inc.
Lowell E. Sears ___ Director Private investor since April 1994
1994. For more than five
years prior thereto, Chief
Financial Officer of Amgen
Inc., a pharmaceutical
company. Director of Neose
Pharmaceuticals, Inc. and
CoCensys, Inc.
</TABLE>
Committee and Board Meetings
The Company's Board of Directors has two standing Committees, the Audit
Committee and the Compensation Committee. The Audit Committee (whose members are
Messrs. Herbert, O'Connell and Steer) is responsible for reviewing the Company's
internal audit procedures, the quarterly and annual financial statements of the
Company and, with the Company's independent accountants, the results of the
annual audit. The Audit Committee met four times during fiscal 1995. The
Compensation Committee, whose members are Messrs. Herbert, O'Connell and Steer,
recommends compensation for officers of the Company. The Compensation Committee
met four times during fiscal year 1995. The Board does not have a nominating
committee.
During fiscal 1995, the Board held five meetings. Each director
attended 75% or more of the total number of meetings of the Board and of
Committees of which he was a member.
Directors' Fees
Directors who are not employees of the Company are compensated at the
rate of $1,500 per month. In addition, each nonemployee director receives $750
for each Board or Committee meeting attended, each Committee Chairman receives
$500 for each Committee meeting attended, and each Committee Secretary receives
$250 for each Committee meeting attended. Each nonemployee director has also
previously received options under the Company's 1988 Nonqualified Stock Option
Plan to purchase an aggregate of 50,000 shares of Common Stock at exercise
prices equal to the fair market value of the Company's Common Stock on the date
of grant, which options are generally exercisable in annual increments of 5,000
shares contingent upon the director's re-election to the Board. In addition,
subject to approval by shareholders, Messrs. Herbert, O'Connell and Steer have
each been granted a fully exercisable option to purchase 5,000 shares. In the
future, if the automatic grant formula proposed for adoption by shareholders is
approved by the shareholders, outside directors who do not hold a previously
granted option which has not fully vested will be automatically granted a 10,000
share option on election and upon each re-election as a director. No such
automatic grants will be made to current outside directors until the annual
meeting of shareholders in 1996. (See Proposal #3 below.)
<PAGE>
APPROVAL OF GRANTS OF OPTIONS AND INCREASE
IN RESERVED SHARES UNDER
1988 NONQUALIFIED STOCK OPTION PLAN
(Proposal #3)
Proposed Resolutions
General. The Board of Directors recommends the adoption of a four part
resolution in order to implement certain current and future grants of options to
outside directors of the Company under its 1988 Nonqualified Stock Option Plan
(the "Plan"): (1) to approve the grant of an option to purchase a total of
50,000 shares to director Lowell E. Sears (the "Sears Option"); (2) to approve
the grant of a one-time 5,000 share option to each of directors G. Arthur
Herbert, Howard V. O'Connell and Randolph C. Steer (the "Other Options"); (3) to
adopt an amendment to the Plan which would provide in the future for the
automatic grant to outside directors upon their election or re-election as a
director of an option to purchase 10,000 shares of the Company's Common Stock
(the "Future Automatic Grants"); and (4) increase by 200,000 the number of
shares reserved for issuance under the Plan (the "Increase in Shares Reserved
Under Plan").
Sears Option. On November 14, 1994 the Board of Directors elected
Lowell E. Sears as an additional director. For more than five years, prior to
April 1994, Mr. Sears was chief financial officer of Amgen Inc., a biotechnology
and pharmaceutical company. As an inducement to join the Company as a director,
the Board authorized, subject to shareholder approval, the grant to Mr. Sears of
a ten-year option to purchase 50,000 shares of the Company's Common Stock at a
price of $10.75 per share, the fair market value of a share on the date of
grant, such option to vest at the rate of 12,500 shares on each of the first
four anniversaries of his election as director provided that he continues to
serve as a director on such vesting date. The shareholders of the Company are
asked to approve the grant of this option to Mr. Sears as part of the resolution
regarding current and future grants of options.
Other Options. The second part of the resolution seeks shareholder
aproval of options granted to outside directors Herbert, O'Connell and Steer
each to purchase 5,000 shares of the Company's Common Stock at $13.50 per share,
the fair market value of a share on the July 1, 1995 date of grant. Such options
are fully exercisable on the date of grant, subject to shareholder approval of
the grant, and remain exercisable for a period of ten years. The reasons for the
proposal are to more fairly compensate such directors for their contributions to
the Company and to provide an incentive for continued high performance.
In 1991 the Board of Directors authorized and the shareholders of the
Company approved the granting to each of such three directors, who were at the
time the only outside directors of the Company, of options to purchase a total
of 25,000 shares of the Company's Common Stock at the fair market value of
$5.375 on the date of grant, each such option to become exercisable as to 5,000
shares on the optionee's re-election as a director in 1991 and each year through
1995. The Board feels that the number of shares has become inadequate in light
of the size and success of the Company and, therefore, proposes to increase the
total number for 1995 to 10,000 through seeking approval of the Other Options
and for future years through the Future Automatic Grants described below.
<PAGE>
Future Automatic Grants. Part three of the resolution is approval of an
amendment to the Plan to provide in the future for certain automatic grants of
options upon the election and re-election of outside directors of the Company.
Each option would be to purchase 10,000 shares of the Company's Common Stock at
the fair market value of a share on the date of such election or re-election and
have a term of ten years. Such options will be fully exercisable on the date of
grant. In the event of the election of a new director by the Board between
shareholder meetings, the number of shares would be pro-rated for the number of
months until the next shareholder meeting. Such options would be granted only to
non-employee, outside directors who do not hold options previously granted which
have not fully vested. Therefore, no automatic options would be granted to
Messrs. Herbert, O'Connell or Steer, until and unless they are re-elected in
1996 and none would be granted to Mr. Sears until and unless he is re-elected in
1999. No new grants of options to outside directors who are serving on the
Compensation Committee at the time of grant or have served on such Committee
wihin the prior 12 months would be permitted under the Plan except through the
automatic grant provision. The shareholders of the Company are asked to approve
the automatic grant provision as a long-term formula for attracting and
retaining qualified outside directors.
Increase in Shares Reserved Under Plan. There are currently 205,000
shares of Common Stock reserved for issuance under the Plan, all of which are
subject to currently outstanding options. There has previously been issued under
the plan a total of 95,000 shares. In order to provide sufficient shares for
current and possible future grants to employees, consultants, directors and
others, the shareholders of the Company are asked to approve the reservation of
200,000 additional shares for issuance under the Plan.
Description of the Plan
General. A general description of the basic features of the Plan is
presented below, but this description is qualified in its entirety by reference
to the full text of the Plan, a copy of which may be obtained without charge
upon written request to the Company's President.
Purpose. The purpose of the Plan is to promote the success of the
Company by facilitating the employment and retention of competent personnel and
by furnishing incentive to directors, officers and employees upon whose efforts
the success of the Company will depend to a large degree.
Term. Options may be granted pursuant to the Plan until the Plan
is discontinued or terminated by the Board.
Administration. The Plan is administered by the Compensation Committee
of the Board of Directors (the "Committee"). The Plan gives broad powers to the
Committee to administer and interpret the Plan, including the authority to
select the key employees to be granted options and to prescribe the particular
form and conditions of each option (which may vary from optionee to optionee).
Eligibility. All key employees, including officers, of the Company or of
any subsidiary are eligible to receive options pursuant to the Plan. Directors
of the Company who are not otherwise employees may be granted options only if
such grants are approved by the shareholders of the Company. As of September 8,
1995, the Company had approximately ___ employees.
<PAGE>
Options. When an option is granted under the Plan the Committee at its
discretion specifies the option price and the number of shares of Common Stock
which may be purchased upon exercise of the option. Unless otherwise determined
by the Board, the option price may not be less than 100% of the fair market
value of the Company's Common Stock on the date of grant. The market value of
the Company's Common Stock on September 8, 1995 was $_____.
The term during which the option may be exercised and whether the
option will be exercisable immediately, in stages or otherwise are set by the
Committee, but the option term may not exceed ten years from the date of grant.
Each option granted under the Plan is nontransferable during the lifetime of the
optionee. Each outstanding option under the Plan will terminate earlier than its
stated expiration date in the event of the optionee's termination of employment
or directorship.
The Committee may impose additional or alternative conditions and
restrictions on the options granted under the Plan.
Amendment. The Board of Directors or the Committee may from time to
time suspend or discontinue the Plan or revise or amend it in any respect;
provided, that no such revision or amendment may impair the terms and conditions
of any outstanding option to the material detriment of the optionee without the
consent of the optionee except as authorized in the event of a sale, merger,
consolidation or liquidation of the Company.
Federal Income Tax Consequences of the Plan. An optionee will not
realize any taxable income on the date an option is granted to the optionee
pursuant to the Plan. Upon exercise of the option, however, the optionee will
realize, in the year of exercise, ordinary income to the extent of the
difference between the option price and the fair market value of the Company's
Common Stock on the date of exercise. Upon the sale of the shares, any resulting
gain or loss will be treated as capital gain or loss. The Company will receive a
deduction in its fiscal year in which options are exercised, equal to the amount
of compensation required to be included as ordinary income by those optionees
exercising options.
Plan Benefits
The table below shows the total number of stock options that have been
received by the following individuals and groups under the Plan:
<PAGE>
1988 Nonqualified Stock Option Plan
Total Number of
Name and Position/Group Options Received (1)
Thomas E. Oland
Chairman of the Board and President -0-
Roger C. Lucas
Vice Chairman and Senior Scientific Advisor 120,000
Thomas C. Detwiler -0-
Monica Tsang -0-
James A. Weatherbee -0-
Current Executive Officer Group (7 persons) 120,000
Current Non-Executive Officer Director Group 215,000(2)
(4 persons)
Current Non-Executive Officer Employee Group -0-
(1) This table reflects the total stock options granted without taking into
account exercises or cancellations. Because future grants of stock options
are subject to the discretion of the Compensation Committee, the future
benefits that may be received by these individuals or groups under the Plan
cannot be determined at this time, except for the automatic grants of
10,000 share options to outside directors as described above under "Future
Automatic Grants."
(2) Includes 50,000 share option granted to Lowell E. Sears and 5,000 share
options granted to Messrs. Herbert, O'Connell and Steer subject to approval
of such grants by the shareholders at the Annual Meeting. See "Sears
Option" and "Other Options" above.
Vote Required
The Board of Directors recommends that the shareholders adopt the
resolutions to approve the option grants and the increase in the number of
shares reserved under the 1988 Nonqualified Stock Option Plan. Approval of such
resolutions requires the affirmative vote of the greater of (i) a majority of
the shares represented at the meeting with authority to vote on such matter or
(ii) a majority of the voting power of the minimum number of shares that would
constitute a quorum for the transaction of business at the meeting.
<PAGE>
EXECUTIVE COMPENSATION
Compensation Committee Report on Executive Compensation
Compensation Committee Interlocks and Insider Participation. The
Compensation Committee of the Board of Directors of the Company is composed of
directors G. Arthur Herbert, Howard V. O'Connell and Randolph C. Steer, M.D.
None of the members of the Committee is or ever has been an employee or officer
of the Company and none are affiliated with any entity other than the Company
with which an executive officer of the Company is affiliated.
Overview and Philosophy. The Company's executive compensation program
is comprised of base salaries, annual performance bonuses, long-term incentive
compensation in the form of stock options, and various benefits, including the
Company's profit sharing and savings plan in which all qualified employees of
the Company participate. In addition, the Compensation Committee from time to
time may award special cash bonuses or stock options related to non-recurring,
extraordinary performance.
The Compensation Committee has followed a policy of paying annual base
salaries which are on the moderate side of being competitive in its industry and
of awarding bonuses based on achievement of specific revenue, profit and
non-monetary goals. If the goals are achieved, the officer receives an option to
purchase a number of shares with a fair market value on date of grant equal to
20% of the officer's base salary and receives, at the election of the officer,
either a cash bonus equal to 20% of base salary or an additional option to
purchase a number of shares with a fair market value on date of grant equal to
170% of the cash bonus alternative. Bonuses are awarded on a prorated basis if
between 85% and 100% of the specific revenue and profit goals are achieved. The
goals are established annually by the Compensation Committee or President of the
Company.
The Company is in the process of entering into formal three-year
employment agreements with its full-time executive officers. See "Employment
Contracts and Change in Control Arrangements" below. The agreements provide for
base salaries subject to annual review, bonuses as described above, benefits as
provided to all employees and severance compensation in an amount equal to one
month's base salary for each year of employment with the Company in the event
that the officer's employment is terminated without cause or in connection with
a sale or merger of the Company.
Compensation in 1995. During Fiscal 1995, the Company implemented a
strategic management reorganization. The Company had operated since the
beginning of the fiscal year with two executive officer, its President and Chief
Executive Officer, Thomas E. Oland, and its Executive Vice President, Dr. Roger
C. Lucas. In March 1995, the Company acceded to the wishes of Dr. Lucas to plan
for his retirement on June 30, 1997 and entered into an agreement with him
whereby he would resign as an officer of the Company as of June 30, 1995 and
reduce his time commitment to the Company but for a two-year period continue as
a director and part-time employee of the Company. Simultaneously the Company
elected five new executive officers, all persons who previously were heads of
departments of the Company. As of July 1, 1995, Dr. Lucas and the Company
determined that greater efforts and involvement by him in the Company's affairs
would be required than was contemplated in March. They, therefore, entered into
a supplemental agreement under which Dr. Lucas has been elected Vice Chairman
and Senior Scientific Advisor to the Board of Directors, his time commitment to
the Company has increased and he has accepted responsibility for the
investigation and development of new business opportunities for the Company.
<PAGE>
In fiscal 1995, the Compensation Committee maintained its principal
compensation policies and made adjustments in base salaries to reflect
competitive industry and individual performance factors. Base salaries for 1995
for each officer were adjusted in reference to individual factors. Mr. Oland's
base salary was increased from $159,000 in fiscal 1994 to $165,000 in fiscal
1995 in recognition of his management performance and the Company's increases in
revenues and earnings. Dr. Lucas' base salary was increased from $192,500 in
fiscal 1994 to $200,000 in fiscal 1995 based on industry norms and the
impressive growth of the Company's Biotechnology Division.
The Committee at the beginning of fiscal 1995 established performance
criteria based principally on growth in revenues and earnings which, if met,
would permit each officer to earn a bonus. All performance criteria were
achieved in fiscal 1995. Mr. Oland elected to waive the bonus which he had
earned. Dr. Lucas received a cash bonus of $80,000 and an option to purchase
25,000 shares of the Company's Common Stock at $13.50 per share.
General. The Company provides medical and insurance benefits to its
executive officers which are generally available to all Company employees. The
Company has a profit sharing and savings plan in which all qualified employees,
including the executive officers, participate. In each of the past three fiscal
years the Company has contributed to the plan an amount equal to approximately
9% to 10% of gross wages. One half of the assets of the plan have been invested
in Common Stock of the Company. The amount of perquisites allowed to executive
officers, as determined in accordance with rules of the Securities and Exchange
Commission, did not exceed 10% of salary in fiscal 1995.
Chief Executive Officer Compensation. Thomas E. Oland served as the
Company's Chief Executive Officer in fiscal 1995. His compensation was
determined in accordance with the policies described above as applicable to all
executive officers. His base salary was increased from $159,000 in fiscal 1994
to $165,000 in fiscal 1995 in light of the Company's 16% increase in net
earnings from 1993 to 1994. For fiscal 1995 performance he earned but waived a
bonus consisting of a stock option and cash. He is eligible for a bonus in
fiscal 1996 in accordance with criteria established by the Compensation
Committee which are based 80% on the Company's achievement of revenue and profit
goals and 20% on intangible factors.
Summary. Aggregate executive compensation decreased moderately in
fiscal 1994 because certain executive officers elected to waive bonuses which
they had earned. The Compensation Committee intends to continue its policy of
paying relatively moderate base salaries, basing bonuses on specific revenue and
profit goals and granting options to provide long-term incentive.
G. Arthur Herbert
Howard V. O'Connell
Randolph C. Steer, M.D.
Members of the
Compensation Committee
<PAGE>
Employment Contracts and Change in Control Arrangements
On March 16, 1995, the Company terminated its prior employment
agreement with Dr. Roger C. Lucas, a director of the Company and formerly its
Executive Vice President, Secretary and Chief Scientific Officer. The Company
agreed to plan for Dr. Lucas' retirement on June 30, 1997 by accepting his
resignation as an officer of the Company effective as of June 30, 1995 but
retaining his services for the additional two year period as a director and
part-time employee. The Company agreed to continue for the two year period to
pay his annual base salary of $200,000, to pay the cash bonus of $80,000 and
issue the option on 25,000 shares of Common Stock for which he was eligible for
fiscal 1995, to pay for accrued, unused vacation time and to continue to provide
him with health and insurance benefits for the term of the agreement unless he
becomes a participant in similar plans elsewhere. The agreement did not
materially alter the terms or applicability of a confidentiality and
non-competition agreement between the Company and Dr. Lucas dated May 28, 1981
whereby Dr. Lucas is prohibited from competing with the Company for a period of
two years following his termination of employment by the Company.
As of July 1, 1995, the Company and Dr. Lucas determined that greater
efforts and involvement by him in the Company's affairs would be required than
was contemplated by the March agreement. They, therefore, entered into a
supplemental agreement pursuant to which Dr. Lucas has been elected Vice
Chairman and Senior Scientific Advisor to the Board of Directors, will spend
approximately 50% of his time as an employee of the Company and is responsible
for the investigation and development of new business opportunities for the
Company. Under the terms of the supplemental agreement, the Company is to
continue to pay Dr. Lucas his annual base salary of $200,000 and has issued to
Dr. Lucas, subject to shareholder approval, an option to purchase an aggregate
of 50,000 shares of the Company's Common Stock at $13.50 per share (fair market
value on the July 1, 1995 date of grant), such option to vest as to 12,500
shares on June 30 of each of 1996, 1997, 1998 and 1999 provided that he
continues to be employed under the terms of the supplemental agreement on such
vesting dates. The supplemental agreement is terminable by either party with or
without cause on 30 days notice. Upon termination of the supplemental agreement,
the parties will revert to the March 1995 agreement with the exception that the
original two-year term of such agreement will be reduced by one month for every
two months which Dr. Lucas has worked under the supplemental agreement.
The Company is in the process of entering into formal three-year
employment agreements with each of its full-time executive officers with the
exception of the President and Chief Executive Officer, with whom the Company
has an oral understanding. The agreements provide for base salaries subject to
annual review, bonuses as described in the Compensation Committee Report
contained in this proxy statement, benefits as provided to all employees and
severance compensation in an amount equal to one month's base salary for each
year of employment by the Company in the event that the officer's employment is
terminated without cause or in connection with a sale or merger of the Company.
Base salaries for fiscal 1996 for the executive officers named in the Summary
Compensation Table are as follows: T. Oland - $175,000; R. Lucas - $200,000; M.
Tsang - $124,000; J. Weatherbee - $124,000; and T. Detwiler - $149,864. Each of
such officers is also subject to a confidentiality and non-competition agreement
which prohibits competition with the Company for a period of two years following
termination of employment with the Company.
<PAGE>
Summary Compensation Table
The following table sets forth certain information regarding
compensation paid during each of the Company's last three fiscal years to the
Company's President (who serves as chief executive officer) and to the Company's
other executive officers) whose salary and bonus for fiscal 1995 exceeded
$100,000.
<TABLE>
<CAPTION>
Long Term Compensation
---------------------------------
Awards Payouts
Annual Compensation
-------------------------------------
Restricted LTIP All Other
Name and Fiscal Stock Options Payouts Compen-
Principal Position Year Salary ($) Bonus ($) Other Awards($) /SARs (#) ($) sation ($)
------------------ ------ ---------- --------- ----- ---------- --------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Thomas E. Oland, 1995 165,000 -0- None None 0 None 17,463(1)
Chairman of the Board 1994 159,000 -0- None None 667 None 26,999(1)
and President 1993 150,000 50,000 None None 5,610 None 28,984(1)
Roger C. Lucas, 1995 200,000 80,000 None None 45,000 None 20,168(2)
Former Executive Vice 1994 192,500 77,000 None None 15,000 None 32,657(2)
President 1993 175,000 90,000 None None 29,537 None 30,651(2)
Monica Tsang, 1995 135,200 25,000 None None 15,000 None 8,732(3)
Vice President - 1994 100,500 -0- None None 0 None 13,005(3)
Research 1993 87,000 -0- None None 0 None 10,984(3)
James A. Weatherbee, 1995 135,200 25,000 None None 15,000 None 8,732(4)
Vice President and 1994 100,600 -0- None None 0 None 13,010(4)
Chief Scientific Officer 1993 87,200 -0- None None 0 None 11,011(4)
Thomas C. Detwiler, 1995 147,000 -0- None None 0 None 17,463(5)
Vice President - 1994 140,000 56,000 None None 25,000 None -0-
Scientific and 1993 N/A N/A N/A N/A N/A N/A N/A (5)
Regulatory Affairs
</TABLE>
(1) Amount reflects Company contributions to Profit Sharing and Savings
Plan (as to one-half) and Stock Bonus Plan (as to one-half), the latter
consisting of 610, 1,103 and 958 shares in fiscal 1995, 1994 and 1993,
respectively.
(2) Amount reflects life insurance premiums of $2,705, $2,150 and $1,667 in
fiscal 1995, 1994 and 1993, respectively. Of the remainder, one-half
reflects Company contributions to Profit Sharing and Savings Plan and
one-half reflects Company contributions to Stock Bonus Plan, consisting
of 610, 1,247 and 958 shares in fiscal 1995, 1994 and 1993,
respectively.
(3) Amount reflects Company contributions to Profit Sharing and Savings
Plan (as to one-half) and Stock Bonus Plan (as to one-half), the latter
consisting of 305, 531 and 363 shares in fiscal 1995, 1994 and 1993,
respectively.
(4) Amount reflects Company contributions to Profit Sharing and Savings
Plan (as to one-half) and Stock Bonus Plan (as to one-half), the latter
consisting of 305, 532 and 364 shares in fiscal 1995, 1994 and 1993,
respectively.
(5) Amount for 1995 reflects Company contributions to Profit Sharing and
Savings Plan (as to one-half) and Stock Bonus Plan (as to one-half), the
latter consisting of 610 shares. Dr. Detwiler's employment with the Company
began in fiscal 1994.
<PAGE>
Option/SAR Grants During 1995 Fiscal Year
The following table provides information related to options granted to
the named executive officers during fiscal 1995. The Company has not granted any
stock appreciation rights.
<TABLE>
<CAPTION>
Individual Grants Potential Realizable
------------------------------------------------------ Value at Assumed
Annual Rates of Stock
Price Appreciation for
Option Term
----------------------
Percent of Total
Options/SARs
Options/SARs Granted to Exercise or
Granted Employees Base Price Expiration
Name (#) in Fiscal Year ($/Sh) Date 5% ($) 10% ($)
------------------- -------- -------------- ----------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Thomas E. Oland -0- -- -- -- -- --
Roger C. Lucas 20,000(1) 21.1% $ 8.875 8/04/01 $ 72,260 $168,397
25,000(1) 26.3% $ 13.50 6/30/02 $137,396 $320,192
Monica Tsang 15,000(1) 15.8% $ 11.25 10/20/01 $ 68,698 $160,096
James A. Weatherbee 15,000(1) 15.8% $ 11.25 10/20/01 $ 68,698 $160,096
Thomas C. Detwiler -0- -- -- -- -- --
</TABLE>
(1) Such options became exercisable immediately upon grant.
Option/SAR Exercises During 1995 Fiscal
Year and Fiscal Year End Option/SAR Values
The following table provides information related to options exercised
by the named executive officers during the 1995 fiscal year and the number and
value of options held at fiscal year end.
<TABLE>
<CAPTION>
Value of
Number of Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
Shares FY-End (#) FY-End ($)(1)
Acquired on Value Exercisable/ Exercisable/
Name Exercise (#) Realized ($) Unexercisable Unexercisable
---- ------------ ------------ ---------------- -------------
<S> <C> <C> <C> <C>
Thomas E. Oland -0- -0- 66,277/0 405,184/0
Roger C. Lucas -0- -0- 134,813/14,724 494,994/49,694
Monica Tsang -0- -0- 25,000/0 76,250/0
James A. Weatherbee -0- -0- 25,000/0 76,250/0
Thomas C. Detwiler -0- -0- 7,500/17,500 0/0
</TABLE>
<PAGE>
(1) Based on the difference between $13.50 (the closing price of the Company's
Common Stock on June 30, 1995 as reported by Nasdaq) and the option exercise
price.
Stock Performance Chart
The following chart compares the cumulative total shareholder return on
the Company's Common Stock with S&P Midcap 400 Index and the S&P Midcap Biotech
Index. The comparison assumes $100 was invested on June 30, 1990 in the
Company's Common Stock and in each of the foregoing indices and assumes
reinvestment of dividends.
<TABLE>
<CAPTION>
Indexed Returns
Years Ending
-----------------------
Company/Index June 90 June 91 June 92 June 93 June 94 June 95
------------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Techne Corporation 100.00 257.14 342.86 561.90 400.00 514.29
S&P Midcap 400 Index 100.00 112.84 133.77 164.13 164.03 200.68
S&P Midcap Biotech Index 100.00 135.55 113.14 121.85 103.38 159.30
</TABLE>
INDEPENDENT AUDITORS
Deloitte & Touche LLP acted as the Company's independent auditors for
the 1995 fiscal year. The Company has not selected its independent auditors for
the current fiscal year ending June 30, 1996.
A representative of Deloitte & Touche LLP is expected to be present at
the shareholders' meeting, will have the opportunity to make any desired
comments, 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 executive officers and directors, and persons who own more than 10
percent of the Company's Common Stock, to file with the Securities and Exchange
Commission initial reports of ownership and reports of changes in ownership of
Common Stock and other equity securities of the Company. Officers, directors,
and greater than 10 percent shareholders ("Insiders") are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file.
To the Company's knowledge, based on a review of the copies of such
reports furnished to the Company, during the fiscal year ended June 30, 1995,
all Section 16(a) filing requirements applicable to Insiders were complied with
except that one Form 4 covering two transactions was filed late by Randolph C.
Steer, M.D.
<PAGE>
SHAREHOLDER PROPOSALS
Any appropriate proposal submitted by a shareholder of the Company and
intended to be presented at the 1995 Annual Meeting must be received by the
Company at its offices by May 22, 1996, to be considered for inclusion in the
Company's proxy statement and related proxy for the 1996 Annual Meeting.
OTHER BUSINESS
The Board of Directors knows of no other matters to be presented at the
meeting. If any other matter does properly come before the meeting, the
appointees named in the Proxies will vote the Proxies in accordance with their
best judgment.
ANNUAL REPORT
A copy of the Company's Annual Report to Shareholders for the fiscal
year ended June 30, 1995, including financial statements, accompanies this
Notice of Annual Meeting and Proxy Statement. No portion of the Annual Report is
incorporated herein or is to be considered proxy soliciting material.
THE COMPANY WILL FURNISH WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT ON
FORM 10-K FOR THE FISCAL YEAR ENDED JUNE 30, 1995, TO ANY SHAREHOLDER OF THE
COMPANY UPON WRITTEN REQUEST. REQUESTS SHOULD BE SENT TO PRESIDENT, TECHNE
CORPORATION, 614 MCKINLEY PLACE N.E., MINNEAPOLIS, MINNESOTA 55413.
Dated: September 20, 1995
Minneapolis, Minnesota
<PAGE>
TECHNE CORPORATION
1988 NONQUALIFIED STOCK OPTION PLAN
(As Amended Through June 30, 1995)
SECTION 1.
DEFINITIONS
As used herein, the following terms shall have the meanings indicated
below:
(a) The "Company" shall mean TECHNE CORPORATION, a Minnesota corporation.
(b) A "Subsidiary" shall mean any corporation of which fifty percent (50%)
or more of the total voting power of outstanding stock is owned, directly
or indirectly in an unbroken chain, by the Company.
(c) "Common Stock" shall mean the Common Stock of the Company (subject to
adjustment as described in Section 10) reserved for options pursuant to
this Plan.
(d) The "Plan" means the Techne Corporation 1988 Nonqualified Stock Option
Plan, as amended hereafter from time to time, including the form of Option
Agreement.
(e) The "Optionee" is an employee, officer, director or such other
individual of the Company or any Subsidiary to whom an option has been
granted under the Plan.
(f) "Committee" shall mean a Committee of three or more persons who may be
appointed by and serve at the pleasure of the Board and shall have such
powers and authority as are granted to it by the Board. Each of the members
of the Committee shall be a "disinterested" person within the meaning of
Rule 16b-3, as then in effect, of the General Rules and Regulations under
the Securities Exchange Act of 1934, as amended. As of the effective date
of the Plan, a "disinterested" person under Rule 16b-3 means a person who,
among other things, is not eligible and has not at any time within one year
prior to appointment to the Committee been eligible to participate in the
Plan or in any other plan of the Company entitling participants to acquire
stock, stock options or stock appreciation rights.
(g) The "Internal Revenue Code" is the Internal Revenue Code of 1986, as
amended from time to time.
<PAGE>
SECTION 2.
PURPOSE
The purpose of the Plan is to promote the success of the Company and
its subsidiaries by facilitating the employment and retention of competent
personnel and by furnishing incentive to directors, officers and employees upon
whose efforts the success of the Company and its subsidiaries will depend to a
large degree.
SECTION 3.
EFFECTIVE DATE OF PLAN
The Plan shall be effective as of the date it is adopted by the Board
of Directors of the Company. Adoption of this Plan shall be and is expressly
subject to the condition of approval by the shareholders of the Company within
twelve (12) months before or after adoption of the Plan by the Board of
Directors.
SECTION 4.
ADMINISTRATION
The Plan shall be administered by the Board of Directors of the Company
(the "Board") or, to the extent empowered by the Board by a Stock Option
Committee (hereinafter referred to as the "Committee" and as defined in Section
1(f) of this Plan) which may be appointed by the Board from time to time. The
Board shall have all of the powers vested in it under the provisions of the
Plan, including but not limited to exclusive authority (where applicable and
within the limitations described herein) to determine, in its sole discretion,
the directors, officers and employees to whom, and the time or times at which,
options shall be granted, the number of shares subject to each option and the
option price and terms and conditions of each option. The Committee shall have
such powers as are granted to it by the Board. The Board, or the Committee, if
so empowered by the Board, shall have full power and authority to administer and
interpret the Plan, to make and amend rules, regulations and guidelines for
administering the Plan, to prescribe the form and conditions of the respective
stock option agreements (which may vary from Optionee to Optionee) evidencing
each option and to make all other determinations necessary or advisable for the
administration of the Plan. The Board's interpretation of the Plan, or the
Committee's interpretation if so empowered by the Board, and all actions taken
and determinations made by the Board pursuant to the power vested in it
hereunder, or by the Committee to the extent empowered by the Board, shall be
conclusive and binding on all parties concerned. No member of the Board or the
Committee shall be liable for any action taken or determination made in good
faith in connection with the administration of the Plan.
In the event the Board appoints a Committee as provided hereunder, any
action of the Committee with respect to the administration of the Plan shall be
taken pursuant to a majority vote of the Committee members or pursuant to the
written resolution of all Committee members.
<PAGE>
SECTION 5.
PARTICIPANTS
The Board, or the Committee, if so empowered by the Board, shall from
time to time, at its discretion and without approval of the shareholders,
designate those directors, officers, employees and such other individuals of the
Company or of any Subsidiary to whom stock options shall be granted; provided,
however, that if the Board or the Committee grants an option to a non-employee
director, such grant shall be approved by the shareholders of the Company. The
Board or the Committee may grant additional options to some or all participants
then holding options or may grant options solely or partially to new
participants. In designating participants, the Board or the Committee shall also
determine the number of shares to be optioned to each such participant.
SECTION 6.
STOCK
The Stock to be optioned under this Plan shall consist of authorized
but unissued shares of Common Stock. Three Hundred Thousand (300,000) shares of
Common Stock shall be reserved and available for options under the Plan;
provided, however, that the total number of shares of Common Stock reserved for
options under this Plan shall be subject to adjustment as provided in Section 10
of the Plan. In the event that any outstanding option under the Plan for any
reason expires or is terminated prior to the exercise thereof, the shares of
Common Stock allocable to the unexercised portion of such option shall continue
to be reserved for options under the Plan and may be optioned hereunder.
SECTION 7.
DURATION OF PLAN
Options may be granted pursuant to the Plan from time to time after the
Plan is approved by the Board of Directors and until the Plan is discontinued or
terminated by the Board.
SECTION 8.
PAYMENT
Optionees may pay for shares upon exercise of options granted pursuant
to this Plan with cash or certified check. The Board or the Committee (if
empowered by the Board) may, in its sole discretion, also authorize optionees to
pay for shares upon exercise of options with Common Stock of the Company valued
at such stock's then "fair market value" as defined in Section 9 below.
<PAGE>
SECTION 9.
TERMS AND CONDITIONS OF OPTIONS
Each option granted pursuant to the Plan shall be evidenced by a
written stock option agreement (the "Option Agreement"). The Option Agreement
shall be in such form as may be approved by the Board, or the Committee if so
empowered by the Board, from time to time and may vary from Optionee to
Optionee; provided, however, that each Optionee and each Option Agreement shall
comply with and be subject to the following terms and conditions:
(a) Number of Shares and Option Price. The Option Agreement shall state
the total number of shares covered by the Option. Unless otherwise
determined by the Board of Directors, the option price per share shall
be equal to one hundred percent (100%) of the fair market value of the
Common Stock per share on the date the Board or the Committee grants
the option. For purposes hereof, "fair market value" of the Common
Stock per share shall be the mean between the "bid" and "asked" prices
quoted by a recognized specialist in the Common Stock of the Company on
the date the option is granted, or if there are no quoted "bid" and
"asked" prices on such date, on the next preceding date for which there
are such quotes; provided that if such stock is then quoted on the
national market system or is listed upon an established stock exchange
or exchanges, such "fair market value" shall be the highest closing
price of such stock on such national market system or stock exchange or
exchanges on the date the option is granted or, if no sale of such
stock shall have occurred on that date, on the next preceding day on
which there was a sale of stock. The Board, or the Committee if so
empowered by the Board, shall have full authority and discretion in
establishing the option price and shall be fully protected in so doing.
(b) Term and Exercisability of Option. The term during which any option
granted under the Plan may be exercised shall be established in each
case by the Board, or the Committee if so empowered by the Board, but
in no event shall any option be exercisable during a term of more than
ten (10) years after the date on which it is granted. The Option
Agreement shall state when the option becomes exercisable and shall
also state the maximum term during which the option may be exercised.
In the event an option is exercisable immediately, the manner of
exercise of the option in the event it is not exercised in full
immediately shall be specified in the Option Agreement. The Board, or
the Committee if so empowered by the Board, may accelerate the exercise
date of any option granted hereunder which is not immediately
exercisable as of the date of grant.
(c) Transfer of Option. No option shall be transferable, in whole or in
part, by the Optionee other than by will or by the laws of descent and
distribution and, during the Optionee's lifetime, the option may be
exercised only by the Optionee. If the Optionee shall attempt any
transfer of any option granted under the Plan during his lifetime, such
transfer shall be void and the option, to the extent not fully
exercised, shall terminate.
(d) Withholding. In the event the Optionee is required under the Option
Agreement to pay to the Company, or make arrangements satisfactory to
the Company respecting payment of, any federal, state, local or other
taxes required by law to be withheld with respect to the option's
exercise, the Board or the Committee may, in its discretion and
<PAGE>
pursuant to such rules as it may adopt, permit the Optionee to satisfy
such obligation, in whole or in part, by electing to have the Company
withhold shares of Common Stock otherwise issuable to the Optionee as a
result of the option's exercise equal to the amount required to be
withheld for tax purposes. Any stock to be withheld shall be valued at
its "fair market value" as provided under Section 9(a) hereof, as of
the date the amount of tax to be withheld is determined under
applicable tax law. The Optionee's election to have shares withheld for
this purpose shall be made by the Optionee on or before the date the
option is exercised or, if later, the date that the amount of tax to be
withheld is determined under applicable tax law. Such election shall
also comply with such rules as may be adopted by the Board or the
Committee to assure compliance with Rule 16b-3, as then in effect, of
the General Rules and Regulations under the Securities Exchange Act of
1934, if applicable.
(e) Other Provisions. The Option Agreement authorized under this Section 9
shall contain such other provisions as the Board, or the Committee if so
empowered by the Board, shall deem advisable.
SECTION 10.
RECAPITALIZATION, SALE, MERGER, EXCHANGE
OR LIQUIDATION
In the event of an increase or decrease in the number of shares of
Common Stock resulting from a subdivision or consolidation of shares or the
payment of a stock dividend or any other increase or decrease in the number of
shares of Common Stock effected without receipt of consideration by the Company,
the number of shares of Common Stock covered by each outstanding option and the
price per share thereof shall be adjusted by the Board of Directors to reflect
such change. Additional shares which may be credited pursuant to such adjustment
shall be subject to the same restrictions as are applicable to the shares with
respect to which the adjustment relates.
Unless otherwise provided in the stock option agreement, in the event
of the sale by the Company of substantially all of its assets and the consequent
discontinuance of its business, or in the event of a merger, exchange or
liquidation of the Company, the Board of Directors may, in connection with the
Board's adoption of the plan for sale, merger, exchange or liquidation, provide
for one or more of the following: (i) the equitable acceleration of the
exercisability of any outstanding options hereunder; (ii) the complete
termination of this Plan and cancellation of outstanding options not exercised
prior to a date specified by the Board (which date shall give Optionees a
reasonable period of time in which to exercise the options prior to the
effectiveness of such sale, merger, exchange or liquidation); and (iii) the
continuance of the Plan with respect to the exercise of options which were
outstanding as of the date of adoption by the Board of such plan for sale,
merger, exchange or liquidation and provide to Optionees holding such options
the right to exercise their respective options as to an equivalent number of
shares of stock of the corporation succeeding the Company by reason of such
sale, merger, exchange or liquidation. The grant of an option pursuant to the
Plan shall not limit in any way the right or power of the Company to make
adjustments, reclassifications, reorganizations or changes of its capital or
<PAGE>
business structure or to merge, exchange or to dissolve, liquidate, sell or
transfer all or any part of its business or assets.
SECTION 11.
INVESTMENT PURPOSE
No shares of Common Stock shall be issued pursuant to the Plan unless
and until there has been compliance, in the opinion of Company's counsel, with
all applicable legal requirements, including without limitation, those relating
to securities laws and stock exchange listing requirements. As a condition to
the issuance of Common Stock to an Optionee, the Board or the Committee may
require the Optionee to (a) represent that the shares of Common Stock are being
acquired for investment and not resale and to make such other representations as
the Board, or the Committee, as the case may be, shall deem necessary or
appropriate to qualify the issuance of the shares as exempt from the Securities
Act of 1933 and any other applicable securities laws, and (b) represent that the
Optionee shall not dispose of the shares of Common Stock in violation of the
Securities Act of 1933 or any other applicable securities laws. The Company
reserves the right to place a legend on any stock certificate issued upon
exercise of an option granted pursuant to the Plan to assure compliance with
this Section 11.
SECTION 12.
RIGHTS AS A SHAREHOLDER
An Optionee (or the Optionee's successor or successors) shall have no
rights as a shareholder with respect to any shares covered by an option until
the date of the issuance of a stock certificate evidencing such shares. No
adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property), distributions or other rights for which the
record date is prior to the date such stock certificate is actually issued
(except as otherwise provided in Section 10 of the Plan).
SECTION 13.
AMENDMENT OF THE PLAN
The Board of Directors of the Company may from time to time, insofar as
permitted by law, suspend or discontinue the Plan or revise or amend it in any
respect; provided, however, that no such revision or amendment, except as is
authorized in Section 10, shall impair the terms and conditions of any option
which is outstanding on the date of such revision or amendment to the material
detriment of the Optionee without the consent of the Optionee.
SECTION 14.
NO OBLIGATION TO EXERCISE OPTION
The granting of an option shall impose no obligation upon the Optionee
to exercise such option. Further, the granting of an option hereunder shall not
impose upon the Company or any subsidiary any obligation to retain the Optionee
in its employ for any period.
<PAGE>
AMENDMENT NO. 1
TO
TECHNE CORPORATION
1988 NONQUALIFIED STOCK OPTION PLAN
This Amendment No. 1 to the Techne Corporation 1988 Nonqualified Stock
Option Plan adopted by resolution of the Board of Directors of Techne
Corporation (the "Company), and effective on the date immediately following the
date the shareholders of the Company approved this Amendment No. 1.
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company has adopted the Techne
Corporation 1988 Nonqualified Stock Option Plan (the "Plan"), which was
subsequently approved by the Company's shareholders; and
WHEREAS, the Board of Directors of the Company has determined it to be
in the Company's best interests to amend the Plan to provide, among other
things, for the grant of nonqualified stock options to the Company's nonemployee
directors pursuant to a formula set forth in the Plan, and the shareholders have
approved such amendment;
NOW, THEREFORE, RESOLVED that pursuant to Section 13 of the Plan,
certain provisions of the Plan are hereby amended to read as follows:
1. Paragraph (f) of Section 1 of the Plan shall be amended in its entirety
to read as follows:
(f) "Committee" shall mean a Committee of two or more directors who shall
be appointed by and serve at the pleasure of the Board. Each of the members
of the Committee shall be a "disinterested" person within the meaning of
Rule 16b-3, as then in effect, of the General Rules and Regulations under
the Securities Exchange Act of 1934 as amended. A "disinterested" person
under Rule 16b-3 generally means a person who has not been, at any time
within one year prior to his or her appointment to the Committee and who
will not be, while serving on such Committee, granted or awarded options
under the Plan, or under any other plan of the Company entitling
participants to acquire stock, stock options, stock appreciation rights or
similar rights that have an exercise or conversion privilege or a value
derived from equity securities issued by the Company, except to the extent
permitted by Rule 16b-3, or any successor provision.
2. Section 1 of the Plan shall be amended by adding the following new
subsection (h) as follows:
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"(h) `Outside Director' means a member of the Board of Directors of the
Company who is not an employee of the Company or any of its affiliates."
3. Section 5 of the Plan shall be amended in its entirety to read as
follows:
"PARTICIPANTS
The Board or the Committee, as the case may be, shall from
time to time, at its discretion and without approval of the
shareholders, designate those employees, directors, officers,
consultants, and advisors of the Company or of any Subsidiary to whom
nonqualified stock options shall be granted under this Plan; provided,
however, that consultants or advisors shall not be eligible to receive
stock options hereunder unless such consultant or advisor renders bona
fide services to the Company or Subsidiary and such services are not in
connection with the offer or sale of securities in a capital raising
transaction; and provided, further, that Outside Directors who are
serving on the Committee or have served on the Committee within the
prior twelve (12) months shall only be eligible to receive nonqualified
stock options pursuant to Section 15. Except with respect to
nonqualified stock options granted to Outside Directors pursuant to
Section 15, the Board or the Committee may grant additional
nonqualified stock options under this Plan to some or all participants
then holding options or may grant options solely or partially to new
participants, and shall also determine the number of shares to be
optioned to each such participant. The Board may from time to time
designate individuals as being ineligible to participate in the Plan."
4. Section 13 of the Plan, "Amendment of the Plan," shall be amended by
adding the following sentence at the end thereof:
"In no event shall the Board or the Committee, either directly or
indirectly, amend the provisions of Section 15 relating to nonqualified
stock options that are granted to Outside Directors more frequently
than once every six (6) months, unless such amendment is required to
comply with changes in the Employee Retirement Income Security Act of
1974, as amended, and the regulations thereunder, or with the Internal
Revenue Code and the regulations thereunder."
5. The Plan is hereby amended by adding a new Section 15, "Nonqualified
Stock Options For Outside Directors," to read as follows:
"SECTION 15
NONQUALIFIED STOCK OPTIONS FOR OUTSIDE DIRECTORS
(a) Grant of Nonqualified Stock Options. Grants of nonqualified stock
options to Outside Directors under this Section 15 shall be automatic
and nondiscretionary and shall be made strictly in accordance with the
following provisions:
(1) No person shall have any discretion to select the Outside
Directors that shall be eligible for nonqualified stock
options granted pursuant to this Section 15 or to determine
the number of shares of Common Stock to be subject to such
options, the option price per share or the date of grant.
<PAGE>
(2) Annual Grants.
a. Each Outside Director who is serving on the Board of
Directors of the Company as of the effective date of
Amendment No. 1 to the Plan shall be granted a
nonqualified stock option to purchase 10,000 shares of
Common Stock on the date of each annual shareholders'
meeting thereafter, so long as such Outside Director
continues to serve on the Board; provided, however,
that such Outside Director shall not be granted such
nonqualified stock option if the Outside Director
currently holds a nonqualified stock option which has
not, as of the date of such annual shareholders'
meeting, become fully exercisable.
b. Each Outside Director who becomes a member of the Board
of Directors after the effective date of Amendment No.
1 to the Plan shall be granted a nonqualified stock
option to purchase 10,000 shares of Common Stock on the
date that such Outside Director is first elected to the
Board of Directors and on the date of each annual
shareholders' meeting thereafter, so long as such
Outside Director continues to serve on the Board;
provided, however, that such Outside Director shall not
be granted such nonqualified stock option if the
Outside Director currently holds a nonqualified stock
option which has not, as of the date of such annual
shareholder's meeting, become fully exercisable; and
provided, further, that if, after his election, such
Outside Director serves on the Board of Directors for
less than 12 months before the annual shareholders'
meeting immediately following his election, such
Outside Director shall receive a nonqualified stock
option for the number of shares determined by
multiplying 10,000 by a fraction, the numerator of
which is the number of months during which such Outside
Director served on the Board of Directors before such
annual shareholders' meeting and the denominator of
which is 12.
(b) Option Price. The option price per share for all nonqualified stock
options granted pursuant to Section 15(a) above shall be one hundred
percent (100%) of the fair market value of a share of Common Stock on
the date the nonqualified stock option is granted. For purposes hereof,
the "fair market value" of a share of Common Stock shall have the same
meaning as set forth in Section 9(a) herein.
(c) Duration and Exercise of Options.
(1) Duration of Options. Except as otherwise provided in
this Plan, the period during which any nonqualified
stock option granted to Outside Directors under this
Section 15 may be exercised shall be ten (10) years
after the date that the option is granted.
<PAGE>
(2) Exercisability of Nonqualified Stock Options.
a. In no event shall any nonqualified stock options
granted to Outside Directors be exercisable prior to
the date that Amendment No. 1 to the Plan is approved
by the shareholders of the Company. If shareholder
approval of Amendment No. 1 is not obtained within
twelve (12) months following its adoption by the Board,
any nonqualified stock options previously granted to
Outside Directors pursuant to this Section 5 shall be
revoked.
b. All nonqualified stock options granted to Outside
Directors pursuant to Section 15(a) shall be fully
exercisable on the date that the option is granted. If
the Outside Director does not purchase in any year the
full number of shares which the Outside Director is
entitled to purchase in that year, the Outside Director
shall be entitled to purchase in any subsequent year
such previously unpurchased shares, subject to the
expiration of such nonqualified stock option as
specified in Section 15(c)(1) above.
(d) Payment of Option Price. Upon the exercise of any nonqualified stock
option granted to an Outside Director pursuant to this Section 15, the
purchase price for such shares of Common Stock subject to such option
shall be paid in cash or certified check, by the transfer from the
Outside Director to the Company of previously acquired shares of
Common Stock, or any combination thereof. Any Common Stock so
transferred shall be valued at its fair market value determined in
accordance with Section 9(a) herein. For purposes of this Section
15(d), "previously acquired shares of Common Stock" shall include
shares of Common Stock that are already owned by the Outside Director
at the time of exercise.
(e) Rights as a Shareholder. The Outside Director shall have no rights as
a shareholder with respect to any shares of Common Stock subject to a
nonqualified stock option until the Outside Director becomes the
holder of record of such shares. Except as provided in Section 10, no
adjustments shall be made for dividends or other cash distributions or
for other rights that have a record date preceding the date the
Outside Director becomes the holder of record of such shares of Stock.
(f) Compliance with Rule 16b-3. All nonqualified stock options granted to
Outside Directors must comply with the applicable provisions of Rule
16b-3, or its successor, of the General Rules and Regulations of the
Securities Exchange Act of 1934, as amended.
(g) Termination of Status as a Director. In the event that an Outside
Director's membership on the Board terminates, the following
provisions shall apply:
<PAGE>
(1) If the Outside Director's membership on the Board terminates for
any reason other than the Outside Director's death, the Outside
Director shall be entitled to exercise any nonqualified stock
option granted to such Outside Director pursuant to this Section
15 until the earlier of (i) the close of business on the date
that is thirty (30) days following the date of such termination,
and (ii) the expiration of the option as provided in Section
15(c)(1) above. To the extent that the Outside Director does not
exercise such Option within the period specified in this Section
15(g)(1), all rights of the Outside Director under such Option
shall be forfeited.
(2) If the Outside Director dies (i) while a member of the Board, or
(ii) within the thirty (30) days following the termination of the
Outside Director's membership on the Board as provided in Section
15(g)(1) above, any nonqualified stock option granted to such
Outside Director may be exercised by the Outside Director's
estate or any person who acquired the right to exercise any
nonqualified stock option granted to such Outside Director
pursuant to this Section 15 by bequest or inheritance until the
earlier of (i) the close of business on the six-month anniversary
date of the Outside Director's death, and (ii) the expiration of
the option as provided in Section 15(c)(1) above.
6. Except as modified herein, all other provisions of the Plan shall remain
in full force and effect.
The undersigned hereby certifies that the foregoing Amendment No. 1 was
adopted by the Board of Directors of the Company on August 30, 1995 and approved
by the shareholders of the Company on October 19, 1995.
TECHNE CORPORATION
By:
Its President
<PAGE>
TECHNE CORPORATION
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints THOMAS E. OLAND and ROGER C. LUCAS, or either of
them acting alone, with full power of substitution, as proxies to represent and
vote, as designated below, all shares of Common Stock of Techne Corporation
registered in the name of the undersigned, at the Annual Meeting of the
Shareholders to be held on Thursday, October 19, 1995, at 3:30 p.m., Minneapolis
Time, at the Sheraton Minneapolis Metrodome Hotel, 1330 Industrial Boulevard at
35W North, Minneapolis, Minnesota, and at all adjournments of such meeting. The
undersigned hereby revokes all proxies previously granted with respect to such
meeting.
The Board of Directors recommends that you vote "FOR" the following proposals:
(1) SET NUMBER OF DIRECTORS AT SIX:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(2) ELECT DIRECTORS: Nominees: Thomas E. Oland, Roger C. Lucas, Howard V.
O'Connell, G. Arthur Herbert, Randolph C. Steer, M.D., and Lowell E. Sears.
[ ] FOR all Nominees listed above [ ] WITHOUT AUTHORITY
(except those whose names have to vote for all nominees
been written on the line below) listed above
(To withhold authority to vote for any nominee, write that nominee's
name on the line below.)
(3) APPRO1VE OPTION GRANTS TO OUTSIDE DIRECTORS AND 200,000 SHARE INCREASE
IN NUMBER OF SHARES RESERVED UNDER 1988 NONQUALIFIED STOCK OPTION PLAN:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(4) OTHER MATTERS. In their discretion, the appointed proxies are authorized to
vote upon such others business as may properly come before the Meeting or
any adjournment.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION
IS GIVEN FOR A PARTICULAR PROPOSAL, WILL BE VOTED FOR SUCH PROPOSAL.
Date , 1995.
PLEASE DATE AND SIGN ABOVE exactly as name appears at the
left, indicating, where appropriate, official position or
representative capacity. If stock is held in joint tenancy,
each joint owner should sign.
<PAGE>
